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ly than I should otherwise have deemed necessary, the true character and kind of funds in which this loan was to be paid. Having done this, I discharge that subject for ibe present, but shall have occasion in the course of this report, to revert to the nature and extent of the difficulties interposed, to prevent the expenditure of this fund, by which interposition the progress of the canal will be arrested for a time, if not entirely defeated.
In addition to the $30,000 loan, I paid into the same bank. in like funds $1,000, and forwarded certificates of deposit to the Receiver, for which I hold his receipt. This amount was disbursed in payments to contractors on the line, and was received by them in payment in the same manner, and to the same extent, that a payment in specie would have been, and answered the same purpose, so far as regards the interests of the Territory, in the payment for the work, that specie dollars would have done. These two loans amounting to $31,000, payable in the kind of funds above stated, would have been sufficient, when added, to the means of the Canal Company, to have completed the work now in progress at the east end of the line, and also the last level of the west end, embracing about seven miles of canal, at the western termination. Having secured this much, I felt that the canal policy was safe; and proceeded to New York with light spirits, feeling that I stood on firm ground—and that if I should be entirely. defeated there, still, the work would safely progress; and that if I . should be successful in obtaining the remainder of the loan, the work would progress with a firm and steady pace, conferring the highest benefits on our community at large, and especially on those of our citizens occupying the canal grant, who have been hoping for something to be done, until hope is almost expired.
In New York I found money matters in much the condition, which I had anticipated, and spent several weeks there in fruitless negotiaation, until at length finding it impossible to obtain any loan at par, and learning the difficulties which had in the mean time been thrown in the way of the disbursement of the funds, which I had secured at Cincinnati, I decided to close with a proposal made me to pay a bonus of $1,000 for a small loan amounting only to $5,000. This bonus I paid cheerfully under the circumstances, without abstracting
a cent from the bonds of the Territory, and placed in deposit in the Bank of America the $5,000, for the same amount of bonds.
I then proceeded to Albany and to the interior of the state, where in the term of three or four weeks, I brought to a close an arrangement for $15,000 to be deposited in the Bank of Vernon. A few days after which I closed an arrangement for $5,000, more, to be deposited in Albany at par, for which I had to give ny personal guarantee for the punctnal payment of the interest and principal by the Territory.
Thus the several arrangements would have given the canal an available fund within the year as follows: Cincinnatti loan,
$31,000 New York City loan,
5,000 Vernon loan,
15,000 Albany loan,
$56,000 Which would have been sufficient, when added to the means of the company, to complete the work now in progress at the eastern termination, the lower level at the western termination, embracing about seven miles of canal — the middle srction connecting the Nagawicka and Namahbin Lakes, including two miles of canal and about six miles of lake navigation; and also that section of the canal from Weaver's run to Redford's run, including about two miles of canal, at all of whieh points valuable water powers would be created in the midst of beautiful and extensive settlements, very much in peed of such local improvements. And in each of these sections of the ļine, the canal passes over ground of the most feasible character, affording the cheapest possible description of work; at the same time by its construction, affording to the respective settlements important domestic advantages and to the canal, a source of immediate revenue. " It was the design of the Canal Company to have put these several portions of the canal under contract without delay, had it not been for obstacles thrown in the way by a part of the Board of Canal Commissioners, through means, for which they have no legal sanction: but in violation of the true spirit of the law, and subversive of the sacred rights and just demands of our citizens.
The difficulties thus interposed, have arisen from an assumption of power on the part of said commissioners to interfere with and dictate unconditionally, as to the loan, and the kind of funds which might or might not be received; and to present clearly and understandingly the unjustifiable nature of this assumption, I will premise, that by the law, the duty of making the loan, devolves entirely and exclusively on the Governor alone; either by his own act, or through means of agents to be by him appointed. (See act of Feb. 1839, sec. 1 and 20; and the act of Feb, 1841, sec. 2, quoted in the preceeding part of this report.) Neither of said acts, nor any other act, confers any power whatever on the commissioners to negotiate any loan, nor are they in any manner authorized to direct the Governor as to the manner in which he shall discharge the official duties devolving on him by law, or sit in judgement on his acts, whether they be right or wrong. Certain duties were to be discharged by the Governor, and if in the discharge of those duties he violates the law, he is responsible to the law and lo the country, for such violation, and not to the board of canal commissioners; nor are they in any manner responsible for his acts. The law has not even named the commissionersin connection with the negotiation of the loan, neither as associating with them the Governor, or otherwise; much less has it conferred o them a dictatorial supervisory control, and absolute veto over his acts. Yet, these same commissioners have by their acts, assumed that the law has, or ought to have, conferred on them this power; or that it has been conferred by divine right in the infalibility of their divine persons; or that it attaches inherently to the exalted official stations which, with so much self-sufficiency they occupy. These are the assumptions of Messrs. Tweedy and Hustis-especially the former
—and I make the assertion on the strength of facts which I shall presently show.
Having completed my arrangements at Cincinnati for the $31,000, I wrote Mr. Tweedy, June 23rd, notifying him officially of the loan, and stated as clearly as I could find language to convey, the nature of the loan in the following words:-" This loan I have been obliged to make in funds bankable at the Life and Trust company, and consider even that very favorable under present circumstances; as that institution being itself a specie paying bank is very circumspect in the kind of funds it receives. I conceive that this is a discretion devolving solely on myself, but hope, as I trust, it will be satisfactory to you and the other commissioners. I shall leave to-morrow morning for New York, and shall spare no pains in my exertions to negotiate the remaining $69,000 wherever it can be found, and hope to find it at some of the eastern banks in their own funds."
This, I am sure is as explicit as words could make it, as to the nature of the Cincinnati loan; and I am confident there is not a friend of the canal in the Territory who will censure me for it; and the censure of its enemies, I regard only as the passing of the idle wind. I am furthermore sure that my views as to the remainder of the loan, are sufficiently and clearly set forth. It is furthermore well known by Mr. Tweedy, and all others who know aught of the subject, that I have under all circumstances been desirous of securing to the Territory the highest possible value for the Territorial bonds, and in the best attainable currency—as a proof of which it is only necessary to refer to the first section of the act of Feb. 1839, the original of which was drafted by my own hand — and no man can truly charge me with any subsequent act to show the contrary.
Yet notwithstanding the explicitness of the information thus given, Mr. Tweedy in his subsequent letter to me affects not to have understood from my letter the kind of funds which was to be received, and to be greatly astonished when he received the certificates from Mr. Lapham, that they were payable in current funds; such a pretence needs no comment.
In the former part of this report I have shown the importance of making that loan, at that particular time, arising out of the uncertainty of being able to secure any other loan, and the necessity of the immediate progress of the work. If any justification be necessary, I deem this sufficient—but I do not admit that any justification is necessary under the law; nor do I choose to admit the force of what those commissioners, for vindictive purposes, may please to construe as law. The law does not require the loan to be made in specie, and it is a fair presumption that it did not intend any such thing; but that is nothing better could be done, the territory would receive and disburse such funds as is used for all the purposes of business through- . out the western states, internal improvements of every kind included. I know of no good reason why Wisconsin cannot dig canal with the same kind of funds which digs canals in Ohio, Indiana, Illinois, &c. and the funds for which I contracted in Cincinnati are better, absolutely better, by three to five per cent. than the funds paid out by those States; and in conversation with Mr. Tweedy he admitted to me, (as he could not do otherwise) that those funds would have been worth as much as specie, within five per cent. So that admitting all that the most fastidious could claim, the loan was equal to ninety-five per cent. in specie-a better loan than has been made by any western state within the last four years.
It was nevertheless, my most anxious wish, if possible, to obtain the remainder of the loan in specie funds at par, as stated in my letter to Mr. Tweedy; but on getting east of Lake Erie, I found that this was not only impossible, but it was with the greatesť difficulty that confidence enough could be given to Territorial credit to get the bonds taken at any price; and consequently, for the loan which I made in New York, I had to pay a bonus of twenty per cent. out of private funds; and at Albany I could not get them taken on any terms with out giving the guarantee of my private credit that the bonds would be punctually met
Notwithstanding all the difficulties which have lrad to be thus encountered to effect any loan; notwithstanding that my loan at Cincinnati was a better one than has been made by any western state fur years: notwithstanding the emergency of the case, and the importance of the present vigorous prosecution of the work; notwithstanding the total absence of any legal right to interfere with the loan, Mr. Tweedy backed up by Mr. IIustis, reckless of all consequences to the canal—to the rights of the people, and the interests of the Territory -issues his imperial ukase, that the loan shall not be paid out; and that consequently the work must stop.
In reply to my letter of June 23d, I received, while in New York, a letter from Mr. Tweedy, dated July 17th, in which he informs me that he “wrote by the last mail to the President of the Ohio Life Insurance and Trust Company, stating our views at large, and desiring