To James Madison from George W. Campbell, 4 May 1814
From George W. Campbell
Treasury Department 4th. May 1814
Dear Sir,
I have the honor to inform you with some Satisfaction, that on yesterday the loan of ten millions of dollars was finally effected at $88 in money for $100 in 6. per. cet Stock: the government agreeing that if any part of the 25. millions authorised to be borrowed for the present year should be given on terms more favorable to the lenders, the benefit of such terms should be extended to the persons then holding the stock issued for the present loan.
The negotiation was attended with some difficulty; and considerable exertions were made to reduce the terms to $85: but it was deemed highly important to the public interest to obtain it on terms not less favorable to the government than those above stated.
A considerable portion of it has been offered by public institutions, and individuals of whose ability there is no reason to doubt. There is, however, a large sum, (5 millions) taken by or in the name of one man, Mr. Barker; who at an early day put in his proposal for that amount on the forgoing terms. It is presumed he acts in conjunction with others, or is supported by some public institutions which will enable him to comply with his proposal.1 He had taken a considerable amount of a former loan; and there appeared no sufficient reason to reject his proposal in this; unless the amount should be considered such: and without his proposal we could not have obtained the ten millions without allowing terms much less favorable to the Government.
I shall not at present trouble you with a further detail of the circumstances attending the transaction. The terms on which the loan has been obtained, are it is believed, more favorable than had generally been anticipated: they are the best on which under existing circumstances the money could be procured; and will, it is hoped, meet your approbation.
I hope, Sir, you and family had an agreeable journey and arrived safe at your residence. Permit me to tender my best respects, in which Mrs. C. joins, to Mrs. Madison, and accept for yourself assurances of the very high & sincere respect, with which, I have the honor To be Sir, Your most obedt. Servt.
G. W. Campbell
P.S. The whole amount offered at different rates exceeded $13,000,000: for some part of which the proposal, (that of Mr. Gray of Boston) was at 75 per cet. ⟨St.?⟩ I ought perhaps to observe that constant interruptions, while writing the forgoing may have rendered it less satisfactory & clear than it might otherwise be, or than it, at present, presents itself to me. You, however, Sir, know sufficiently well, how to appreciate such circumstances.
RC (DLC). Docketed by JM.
1. Jacob Barker’s initial offer to provide $5 million of the loan stipulated that he would raise the money from various banks in exchange for a promise that they would be given a significant share of the Treasury’s business. Campbell entered into no such formal agreement but told Barker unofficially that the government would patronize the contributing banks, and that JM and the rest of the cabinet “thought that there would not be any difficulty” with this. Barker managed to pay the first two installments of the sum but defaulted thereafter. He blamed the Treasury for not adhering to Campbell’s assurances, despite JM’s urging in July 1814 that it be done, and for having failed, following his initial payments, to issue stock certificates that he could sell to raise the remaining funds (Barker, Incidents in the Life of Jacob Barker, 47–52, 55, 61, 70, 73–78, 80–81).