Financing our Revolution

  • Prosperity
  • 1776

The war that created America depended heavily on private action and philanthropy. In present terms, it cost billions of dollars to equip Washington’s Continental Army, arm our new Navy, and fund the deliberations of Congress. Financiers Robert Morris and Haym Salomon borrowed or raised for their country nearly all of the necessary money, working for free, battling for low interest rates, and repeatedly donating their own funds.

The unsung Salomon, for instance, gave money over and over to help key members of the Continental Congress come to Philadelphia to deliberate. He personally bought vital supplies, and used his connections to get the best possible terms for the nation as it borrowed funds in turbulent money markets. When Washington trapped British General Cornwallis near Yorktown but lacked the means to move and supply his army for the final battle of the Revolution, he cried “Send for Haym Salomon”—who quickly scratched together $20,000 under great pressure.

Having joined the Sons of Liberty early on, Salomon was twice imprisoned by the British as a spy. The second time he escaped on the day before his execution. He gave his own money to many men he considered unrecognized heroes of the war, like senior Army surgeon Bodo Otto, who had bankrupted himself buying medical supplies for his soldier patients.

Salomon was an active philanthropist in several sectors before he died at age 44 of tuberculosis (contracted while he was in prison). And his repeated contributions in wartime left his widow and four children penniless, because the hundreds of thousands of dollars of Continental debt he bought with his own fortune were worth only about 10 cents on the dollar at the time of his passing.

Robert Morris, who personally bought much of the ammunition used by Washington’s army, was likewise damaged financially by his giving and his work without pay during the Revolution. James Swan, a financier who was wounded twice at Bunker Hill, then rose to command the Massachusetts militia, sold millions of acres of western land he owned to pay the military expenses of Massachusetts soldiers and equip several privateers to operate against the British. He later assumed the U.S. debt to France run up during the Revolution.