Second in Command of
the United States Army
Hamilton was spared the full consequences of the exposure of his relations with Mrs. Reynolds by an even greater sensation in the news--the announcement by the French government of new regulations affecting American shipping and the breakdown in Paris of negotiations between the two countries. In January, 1796, the Directory decreed that every neutral vessel laden wholly or in part with articles of British produce or manufacture, regardless of ownership, would be liable to capture and confiscation. And contrary to Hamilton's predictions that the French would receive the three American plenipotentiaries, they fared no better than had Charles C. Pinckney when he was sole United States Minister. Undeniably, Marshall, Gerry and Pinckney arrived in Paris at an unpropitious moment. The Directory had just been purged of its moderate members (they were condemned to the "dry guillotine," i.e., transportation to Guiana); French armies were on the point of forcing Austria to accept the humiliating peace of Campo Formio; and, as John Marshall said, Spain, Portugal, Tuscany, Naples and the Pope stood upon melting ice.
The footing of the American envoys was far from solid; they waited vainly in the anterooms of the Directors for recognition while trophies of victory piled up in Paris. With every batch of good news from the fighting fronts, the attitude of the French government became progressively less conciliatory, until finally, late in October, 1797, the American diplomats were approached by agents of Talleyrand, the Minister of Foreign Affairs. These agents (later designated by President Adams as X, Y, and Z) informed the envoys that unless they were prepared to pay the Directors a $250,000 bribe and to make a large loan to France--$12,800,000 was the figure suggested-- they might as well go home. Although the Americans declared that they were prepared to consider a pourboire for Talleyrand after a treaty had been signed, and to confer with their home government regarding a loan if the Directory would cease to pillage American commerce, they declined to do