f near $1,300,000. If the military
and naval establishments were to be continued at the figures of 1809,
when six millions were expended, there would result a deficiency of
$3,000,000, and a loan of $4,000,000 would be necessary. Otherwise the
Mediterranean Fund would suffice. The cash in the Treasury had fallen
from nearly fourteen millions on June 2, 1809, to less than six millions
on September 3, following. In this report Gallatin expressed his
opinion, that the system of restriction established by the embargo and
partly relaxed must be entirely reinstated or wholly abandoned. On May
1, 1810, an act of strict prohibition of importations from Great
Britain and her dependencies was passed.

While from the incompetency of the administration the country was fast
approaching the real crisis of open war, the Republicans in Congress
were deliberately destroying and undermining the basis of national
credit, by which alone it could be carried on. In February the United
States Bank, by which, and its branches, the customs were collected
throughout the country, was destroyed by the refusal of Congress to
renew its charter. Mr. Gallatin in his combinations never contemplated
such a contingency as the total destruction of the fiscal agency on
which the government had relied for twenty years. Unwilling to struggle
longer against the mean personalities and factious opposition of his own
party in Congress, he tendered his resignation to Mr. Madison. But the
Republican party was a party of opposition, not of government. With the
exception of Mr. Gallatin, no competent administrative head had as yet
appeared. There was no one in the party or out of it to take his place.
Mr. Madison knew it. Mr. Gallatin felt it, and remained. Congress met in
November. On the 25th Mr. Gallatin sent in his annual report; the
receipts reached thirteen and a half million dollars.

The budget for 1812 left a deficiency to be provided for of $1,200,000.
This was a small matter. The revenue Mr. Gallatin proposed to increase,
on the plan before recommended, by additions of fifty per cent, to the
imposts on foreign commerce. This he preferred to any internal tax.

At the close of the year the country, chafed beyond endurance by the
indignities put upon it and the sufferings it encountered without
compensation to its pride, was eager for war. Congress was no way loath
to try the dangerous path out of its labyrinth of blunders. The near
contingency imposed the