The Forgotten Financiers of the Louisiana Purchase

Parker left the United States in the late summer of 1784, under a cloud of suspicion from his partners in the United States, but with a good reputation from George Washington and John Adams. Arranging profitable speculation on U.S. securities with Dutch merchant bankers, he ended up establishing good relations with Sir Francis Baring, while moving between Amsterdam, Paris, and London. In Paris, he joined a partnership with Joel Barlow and made a fortune for both of them by arranging shipping of goods from the West Indies to revolutionary France with American ships. Insight into his operations is found in the Baring Archive, which deals with the fate of a U.S. ship, the Rosanna, whose rich cargo from Surinam was seized by French privateers. It became one of the claims against France under the terms of the Louisiana Purchase. Parker earlier had invested proceeds of his shipments to France in purchasing country estates seized by French nobles and, eventually the Paris mansion of the Comte de Montmorin. Shortly after the conclusion of the Louisiana Purchase, Parker also purchased the fabulous Chateau de Draveil on the outskirts of Paris. He sold it in 1821, probably to pay off claims of John Holker, his earlier partner in supplying Washington’s armies during the Revolution. Nevertheless, he needs to be given credit for promoting the Louisiana Purchase to Sir Francis and the American ministers in Paris.

François Barbé-Marbois encounters problems meeting Napoleon’s demands for money to continue paying his troops stationed in Boulogne for the intended invasion of Britain in 1805. He relies on the company of French military suppliers, the Négociants Réunis, to make good their claims on the newly chartered Banque de France, despite Spain’s failure to supply its agreed tribute. A general banking crisis occurs in Paris. Napoleon then reverses his army from invading Britain to attack Austria. His victory at Austerlitz and occupation of Vienna seals his role as Emperor. On his return to Paris in January 1806, he removes Barbé-Marbois from office and replaces him with Nicolas Mollien. Napoleon also places under arrest the leading French military supplier, Gabriel Ouvrard, but who gains his temporary freedom by promising to use Baring & Hope to regain access to Spain’s silver money located at the mint in Mexico. Labouchere, disappointed at losing part of the Louisiana profits, takes up Ouvrard’s claims on Mexico to organize the import of Mexican silver to both London and Amsterdam via neutral American ships. He sets up David Parish in Philadelphia to organize the scheme, Vincent Nolte in New Orleans to intermediate, and Armand Lestapis in Vera Cruz to convert Ouvrard’s claims into silver pesos for export to the United States and Europe. The sums gained by Baring & Hope from the Mexican silver scheme exceeded by far those from the Louisiana Purchase, which had laid the basis for the larger adventure.

The main reason the historical literature has overlooked the important roles played by these two financiers during this historic period of transformation of international finance is likely because neither man wrote about it explicitly. Both had to deal with tenuous political environments: Alexander in Britain because of his obvious attachment to the economic interests of the United States, which discredited him in the eyes of the war-hawks in Britain, first because of the apparent financial support to Napoleon, and then because of the War of 1812 and the general popular enthusiasm of the British public to defeat the U.S. Pierre in Amsterdam had to deal with the frequently changing political tides in the Netherlands from 1787 to 1815, which led him to spend the remainder of his life as a country squire in England. Gallatin and Barbé-Marbois lived on to write substantial works afterward, but Gallatin’s were on the ethnography of Native Americans, after vainly defending, once again, the re-chartering of the Bank of the United States. Barbé-Marbois’s attention was focused more on the continuing efforts of while planters to regain control of Haiti, and it was only at the end of his life that he allowed an American translation of his History of Louisiana to appear. Vincent Nolte lived on to write a fascinating memoir after surviving several duels in New Orleans, but failed ultimately in the last crisis of 1837. David Parish, after losing out to the Rothschilds in the re-financing of Austrian finances after Waterloo, committed suicide by drowning in the Danube. Alexander and Pierre, prospering in their respective country estates in England, should be recognized now as successful pioneers in the development of international finance, based on marketable sovereign debt.