Part 4

Madison argued that his proposal was only a temporary one and that as far as possible the trade should be free. He said, “If my general principle is a good one, the term commerce ought to be free, and labor and industry left at large to find its proper object, the only thing which remains will be to discover the exceptions which did not come within the rule that I have laid down....”

It was Madison’s belief that the cheapness of land in the United States, compared with the cost of land in other nations, gave this country a great advantage in agricultural trade. He said that so far as manufacturing was concerned, “Other countries may and do rival us.” But then he added, “We may be said to have a monopoly in agriculture; the possession of the soil, and the lowness of its price, give us as much a monopoly in this case, as any other nation or other parts of the world have in the monopoly in any article whatever; but with this advantage to us, that it cannot be shared nor injured by rivalship.”

Nevertheless, while favoring free trade, Madison conceded that if America did leave her ports entirely free then the country would suffer. He said, “If America was to leave her ports perfectly free, and make no discrimination between vessels owned by her citizens and those owned by foreigners, while other nations make this discrimination, it is obvious that such policy would go to exclude American shipping altogether from foreign ports, and she would be materially affected in one of the most important interests.”

Despite sharp and often bitter differences, the young Congress was aware that sectional interests were secondary to the absolute necessity for action in collecting revenue. Within a short time it had put together the first Tariff Act. It was titled “An Act for laying a duty on goods, wares and merchandise imported into the United States.” And on July 4, the thirteenth anniversary of the signing of the Declaration of Independence, President Washington signed into law the act which was the second to be passed by the Congress.

Then Congress quickly set up the machinery for the collection of the tariff. This was done in the Fifth Act, “To regulate the collection of the duties....” The bill was sent to President Washington for his signature on July 31, which fell on Friday. On the following Monday the President sent to the Senate a list of about one hundred appointments to Customs offices. The Senate advised and consented to about half this list but on the following day gave the President an unexpected jolt. The Senate, without warning, refused to consent to the appointment of Colonel Benjamin Fishbourn to be Naval Officer (auditor) at the Port of Savannah. Fishbourn had served with distinction in Washington’s command during the Revolution and apparently had a spotless reputation in civilian life.

Washington did not make a fight over Fishbourn’s rejection even though the Senate action no doubt seemed to him to be a petty and totally unwarranted assertion of veto power. He did send a message to the Senate which called to mind later clashes between Chief Executives and Congress, pointing out that at least the Senate might have done him the courtesy of inquiring into his reasons for appointing Fishbourn.

Perhaps under different circumstances Washington would not have been so mild in his reaction to the Senate veto. But the need to establish an organization for collecting revenue was imperative, and Washington perhaps felt this was no time for a fight over executive and legislative prerogatives. The most pressing need was unity in the government.

And so was the Customs Service created to help bring financial stability to the nation at a critical time. Despite all the trials and difficulties, the Customs Service collected more than $2 million for the Treasury in its first year of operation.

3

A PRESIDENT IS BAMBOOZLED

There was little cause for gaiety in any part of the nation in the summer of 1808. Gloom hung over the country and particularly over Washington, where even the new capital building had not been completed and the problems of getting the young government firmly established sometimes seemed insurmountable.

The reason for the gloom was the worsening relations between the United States and Great Britain and the threat of American involvement in the brawling affairs of Europe, where the British were at war with the French.

In a desperate move to avoid being drawn into the conflict, President Thomas Jefferson had called the previous year for an embargo on all overseas shipping. He felt such drastic action necessary because British warships had been seizing American vessels headed for France. Even worse, the British had been forcing American sailors from the ships on the high seas and impressing them into British naval service by the hundreds.

Under these circumstances, Jefferson decided it would be better to withdraw American shipping from the seas and deny American supplies to the combatants, rather than risk plunging the nation into another war. His proposed embargo had been fought over bitterly in Congress. But in December, 1807, the Embargo Act had been passed and shipping had come to a halt. Even trade with Canada would be stopped with the enforcement of a land embargo--except for the commerce carried on by smugglers defying Federal Customs officers.

Now, seven months after the start of the embargo, the nation was in deep trouble. New England was practically paralyzed. Ships which had engaged so busily in world commerce a few months earlier stood rotting at the wharves. The number of unemployed was alarming. Businessmen who depended on overseas trade were going bankrupt. There was scarcely anyone in the country who did not feel the depressing effects of the embargo. The nation’s economy had sunk to its lowest point since the Revolution.

President Wilson was to say of this period: “The States themselves suffered from the Act more than the nations whose trade they struck at. America’s own trade was ruined.”

Onto this gloomy stage in mid-July, 1808, strode the so-called Chinese mandarin, Punqua Wingchong, and before two months had passed this Oriental fraud had half the country hooting with derisive laughter and the other half red-faced with rage.

Punqua Wingchong. It’s a name to remember in American history because he helped to bamboozle a President of the United States in one of the gamiest confidence games ever pulled against a trusting Chief Executive. But he was only the puppet; the man who pulled the strings behind the scenery was John Jacob Astor, the merchant prince.

The hoax began to unfold in June, 1808, when Astor and the Boston firm of J. & T. H. Perkins applied to the government for permission to send a ship to Canton to bring back certain property allegedly owned by the applicants. The government refused to lift the embargo for such a venture and as a matter of policy rejected the application.

The rejection would have discouraged the average merchant, but John Jacob Astor did not build his fortune by being an average man. Soon after the application was refused, Senator Samuel L. Mitchill of New York was told a disturbing story. An anonymous informant advised him that a distinguished Chinese mandarin, who divided his time between New York City and Nantucket, was the unfortunate victim of the shipping embargo. It was said that the mandarin, Punqua Wingchong, had made the long and arduous voyage from Canton to collect several large debts owing to his grandfather’s estate. Then he had been caught by the embargo and had been unable to return to his homeland to participate in mourning rites for his venerable grandfather, who had died suddenly.

It was suggested to Mitchill that the situation was one which quite possibly could create ill feeling between the governments of the United States and China if Wingchong chose to blame the Jefferson administration for the predicament he found himself in, being a virtual prisoner in a foreign land. Wingchong was reputed to have considerable influence among the government class of China, and this influence could be used against American traders in the future if he were not permitted to return home.

The journals of the time were not clear as to whether the Senator ever met Wingchong face to face. In all likelihood he did not. But he was moved to such sympathy by the pictured plight of the hapless mandarin that he penned a personal appeal asking President Jefferson to intervene. The Senator had a distinguished background in science and literature and was a professor of natural history in the College of Physicians and Surgeons in New York City. It was later to be said that Senator Mitchill was “strangely deficient in that useful commodity called common sense,” but his motives seemed sincere enough when he wrote to the President on July 12, saying:

Sir:

Punqua Wingchong, a Chinese merchant, will be the bearer of this note of introduction. He came to New York about nine months ago, on business of a commercial nature, and has resided during that time, part time, partly here and partly in Nantucket. Having completed the object of his visit to the United States, he is desirous of returning to Canton, where the affairs of his family, and particularly funeral obsequies of his grandfather, require his solemn attention.

This stranger is represented to me as a man of respectability and good standing in his country; and is consequently entitled to a corresponding regard and treatment in ours.

The chief object of his visit to Washington is to solicit the means of departure, in some way or other to China, but he feels at the same time a strong desire to see the chief executive officer of the United States. He will be accompanied by Mr. Palmer, an inhabitant of New York, who will aid him in stating his request and explaining his meaning. This gentleman, in addition to many other valuable qualities, possesses admirable skill in acquiring languages; and he is perhaps already master of more living tongues than any person among us--as an evidence of which he has already made considerable progress in China.

While I recommend these two persons to the notice of the President I beg leave to accompany the recommendation, with the highest expression of my high and respectful consideration.

_Sam’l L. Mitchill._

Armed with the Mitchill letter and dressed in the finest of silks and brocades, Punqua Wingchong journeyed to Washington and no doubt created a stir of excitement throughout the city, where visitors from the Orient were not a common sight. Unfortunately, or perhaps otherwise, Wingchong and his companion, Mr. Palmer, found they could not deliver the letter to the President in person. Mr. Jefferson had left the city for a rest at Monticello.

The Mitchill letter was then forwarded to Monticello along with a note signed by Punqua Wingchong “praying permission to depart” from the United States with his retinue and his belongings in a vessel of his own choosing.

President Jefferson was moved by Wingchong’s appeal. Not only did he feel sympathy, but he felt the situation presented an opportunity to establish better relations between his government and the rulers of China, which was becoming an increasingly important customer in foreign commerce. On July 25, the President wrote to Secretary of the Treasury Albert Gallatin saying:

Dear Sir:

... Punqua Wingchong, the Chinese Mandarin, has, I believe, his headquarters at New York, and therefore his case is probably known to you. He came to Washington just as I had left it and therefore wrote to me praying permission to depart for his own country with his property in a vessel to be engaged by himself.... I consider it as a case of national comity, and coming within the views of the first section of the first Embargo Act. The departure of this individual with good disposition may be the means of our making our nation known advantageously as a source of power in China to which it is otherwise difficult to convey information. It may be a sensible advantage to our merchants in that country. I cannot therefore but consider that a chance of obtaining a permanent national good should outweigh the effect of a single case taken out of the great field of the embargo. The case too is so singular that it can lead to no embarrassment as a precedent....

(signed) Th. Jefferson.

Gallatin detected an odor of intrigue in the situation because Wingchong requested permission to make the trip to China in the _Beaver_, a “full-bottomed ship of 427 tons with a capacity for 1,100 tons of cargo,” and the _Beaver_ had been constructed especially for John Jacob Astor. Gallatin was well aware of the fact that scarcely a month had passed since Astor had been denied permission for a Canton voyage. But Jefferson had issued his instructions and Gallatin was a loyal lieutenant.

On August 3, 1808, Gallatin wrote to David Gelston, Collector of Customs in New York City, ordering him to make an exception and lift the embargo. His letter said in part:

Sir,

Punqua Wingchong, a respectable Chinese, who had with the leave of his government come to the United States for the purpose of collecting debts due to his father’s estate, having obtained the special permission of the President of the United States to engage a vessel to carry himself together with his attendants and property to his native country, and having made arrangements for that purpose with the owner of the ship _Beaver_ of 427 tons or thereabouts; you would be pleased to permit that vessel to depart for Canton on the following terms and instructions....

The conditions, previously outlined by Jefferson, were that the vessel could sail with equipment and provisions for crew and passengers. Punqua Wingchong was to be permitted to be accompanied by his “attendants” along with their baggage and personal effects and also about $45,000 ... “either in specie or in furs, cochineal, ginsang, or any other specie of merchandise of his choice.”

After giving these instructions to Gelston, Gallatin wrote a cautious letter to Jefferson saying that he had carried out his orders and Wingchong “has engaged Astor’s vessel to which we had on general grounds refused permission.” Then he added: “Had I had any discretion as to the application itself I would have hesitated; for I apprehend that there is some speculation at bottom; and every deviation from general rules is considered a favoritism and excites dissatisfaction.”

He also warned Jefferson that to lift the embargo for one vessel would open the way for others to make direct appeals to the President for special treatment. Jefferson did not agree with his Secretary. He insisted that important diplomatic and commercial benefits might accrue from the courtesies shown Wingchong and they were “likely to bring lasting advantage to our merchants.”

Gallatin was right. The uproar came when Collector Gelston authorized the voyage and workmen began swarming over the _Beaver_ to prepare her for the long sea voyage. With other vessels standing idle and deserted, such a burst of activity could hardly be kept secret along the waterfront. In all the United States, this lone ship was the only one being prepared for a voyage.

The first protest came from a group of Philadelphia merchants who wrote to Secretary Gallatin on August 10 suggesting that “avarice and perjury” were being used to obtain the special dispensation for the voyage of the _Beaver_. As for Punqua Wingchong, the merchants said they were satisfied he was an impostor “and an insignificant instrument in the hands of others.” He was unknown to Philadelphia traders who had been stationed in Canton as agents for years. At best he was only a petty shopkeeper without credit and not a wealthy member of the mandarin class, they insisted. It was pointed out to the President that the mandarins of China never left their own country.

New York newspapers, getting wind of the _Beaver_’s voyage, described Wingchong as “a Chinaman picked up in the port,” “a common Chinese dock loafer,” “a Lascar sailor,” and even as “an Indian who had been dressed up in Astor’s China silks and coached to play his role in the affair.”

The New York _Commercial Advertiser_ on August 13 said in a page-one story:

A first rate merchants’ ship, which will be navigated by about 30 seamen, is preparing for sea, and is expected to proceed on a voyage to Canton, in a few days, under special permission from the President of the United States.

The ostensible object of this voyage is to carry home a person who is said to be a Mandarin of China.

It is, however, well known that the person for whom permission has been obtained, is no Mandarin; is not even a licensed or security merchant;--that his departure from China was contrary to the laws of that country; that if he arrives in China he will be put on shore privately, and that the obscurity of his condition in life affords him the only chance he has of avoiding punishment.

It is also believed that the owner of the ship would not accept all the property of all the Chinese in this country as a compensation for the voyage, and it is known that he has offered to contract for bringing home goods or freight....

Neither Gallatin nor the President retreated before this barrage. Gallatin wrote the Philadelphia merchants that their plea had come too late and besides he had no authority to detain the _Beaver_. He delayed his reply until September 17--the same day on which the _Beaver_ sailed.

Six days later, Jefferson admitted that he had no means of judging whether the charges by the Philadelphia merchants were true or false. He said he acted as he did because of “the application having come to me grounded on his character as a settled fact.” He added “nor are the jeers of the Federalists any proof of the contrary.” Then he made the rather lame statement that if the _Beaver_ had not yet sailed perhaps “she should be detained till the facts ... are inquired into.”

But the _Beaver_ was gone. She was to return a year later with a cargo of teas, silks, and other valuable merchandise which allegedly brought Astor a net profit of $200,000.

* * * * *

The December embargo on shipping had been followed in March by the Land Embargo, which became effective just before Lake Champlain was free of ice and open for normal navigation. The Land Embargo came as a shock for the people of northern and northeastern Vermont. Over the years they had developed a brisk trade with Canada, shipping timber, potash, coal ashes, and other exports into Canada in return for Canadian merchandise. The embargo had the effect of shutting off this lucrative trade for the Vermonters.

The Act was not popular with the citizens or with most Customs officials along the border and as a result there was lax enforcement. Smuggling operations reached such proportions that Customs Collector Jabez Penniman wrote to Secretary of the Treasury Gallatin, complaining that he could not enforce the law unless the Federal government supplied troops.

Penniman’s communication spread alarm in Washington. Gallatin personally carried the letter to the White House to discuss emergency steps with the President. Jefferson called in Senator Robinson and Congressman Witherell of Vermont to obtain their advice. The Vermonters told him that the smuggling could not last for long, probably no longer than early May. Then the Richelieu river would subside from its spring flood stage and would not be navigable for the big rafts used to carry smuggled timber and other products.

Despite the assurances from Robinson and Witherell, Jefferson was convinced that strong Federal action had to be taken immediately, to set a precedent if for no other reason. The President directed Gallatin to authorize Collector Penniman to equip and arm “such vessels as might be necessary” to put down the smuggling. Penniman also was authorized to engage crews for these vessels “voluntarily, by force of arms, or otherwise, to enforce the law.” Then if further aid were necessary, the Secretary of State was to authorize the United States Marshal to form a posse to “aid in suppressing the insurrection or combination.”

These measures would seem sufficient to discourage any normal smuggler. But, apparently caught up in the enthusiasm of stamping out the evasion of the Embargo and the payment of Customs duties, the President went even further. He declared that in case the armed vessels and the posses should not be able to do the job, then the Secretary of War was to move Federal armed forces to the scene. The Secretary himself was asked to go to Vermont “and lend the aid of his counsel and authority.” Also the aroused President informed Secretary Gallatin that he was going to have two gunboats built at Skenesborough (Whitehall), New York, to halt the flow of illegal traffic between Vermont and northern New York and Canada.

Many Vermonters were surprised and indignant at the President’s use of the word “insurrection” to describe the situation. But in May, 1808, the good citizens of Vermont (and those not so good) were thrown into further uproar by a Presidential proclamation which appeared without warning in _Spooner’s Vermont Journal_. It said information had been received by the White House that “sundry persons are combined or are combining and confederating together on Lake Champlain and the country thereto adjacent, for the purpose of forming insurrections against the authority of the laws of the United States, for opposing the same and obstructing their execution.” The President sternly warned against any person engaging directly or indirectly “in any insurrection” and he ordered “such insurgents and all concerned in such combinations, instantly and without delay to disperse themselves and retire peaceably to their respective abodes.”

The citizens of St. Albans for some reason must have felt that the President was aiming his shafts at them. At any rate, a town meeting was held in St. Albans at which it was “positively and unequivocally” the consensus that the conduct of the citizens of the district had never given President Jefferson cause to issue such a proclamation. It was the sense of the assembly that the President’s proclamation “must have been issued in consequence of erroneous and unfounded representations, made and transmitted to the executive department of the United States by some evil minded person or persons.” Then the citizens let their personal sympathies leak into the matter when they added that even if individuals “finding themselves and their families on the verge of ruin and wretchedness” had tried successfully to evade the embargo, nevertheless this did not justify the President in proclaiming to the world that the district was guilty of insurrection and rebellion.

People living along the Canadian border, whose livelihood depended on the trade with Canada, did not regard this trade as being the evil which Jefferson declared it to be. For them it was a matter of economic survival. Soon after the Land Embargo became a law, smuggling rings had begun operations along the border. Dress goods and other merchandise were carried to the border on the Canadian side, where it was picked up by men and transported through the woods into the United States. The contraband was hidden until such time as it could be taken by wagons or boats to the merchandising centers.