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IN JULY 1781, ON A WARSHIP anchored off Santo Domingo, two men met to devise a plan that would ultimately lead to American independence. The two representatives of European monarchs agreed to align French and Spanish military and financial resources against England in support of the American revolutionary cause.

Within months, with some luck and proper execution, their plan would result in one of the most impressive military successes of the Revolutionary War—a watershed victory that eventually convinced the British to abandon their fight to keep the thirteen colonies from becoming an independent nation.

The plan devised by French Rear Adm. François Joseph Paul, comte de Grasse, and Spaniard Don Francisco Saavedra de Sangronis, known as the de Grasse–Saavedra Convention after its ratification in Paris and Madrid, had far-reaching aims. Saavedra described the convention’s goals in his journal: “These were to aid the Anglo-Americans powerfully, in such a way that the English cabinet would in the end lose the hope of subduing them; to take possession of various points in the Windward Islands, where the English fleets lying in protected forts were threatening French and Spanish possessions; and to conquer Jamaica, the center of the wealth and power of Great Britain in that part of the world.”

The first part of their plan hinged on thwarting the British fleet in North America through the timely naval support of the French, preventing General Charles Cornwallis from receiving reinforcements at Yorktown, Virginia, while George Washington’s army blocked his retreat by land. To do this required hard currency—gold and silver to finance French efforts and pay soldiers of the Continental Army, many of whom hadn’t received any pay in months—as by that time hyperinflation had rendered the Continental currency worthless. In a dramatic last-minute effort, often overlooked in histories of the war, most of the needed funds were raised within six hours in Cuba, in an emergency collection from the people of Havana.

The vital French and Spanish help came at a time when the rebel army was showing signs of improvement. Washington had managed to harass the British on their retreat from Philadelphia to New York in 1778, although the Battle of Monmouth Court House had been at best a draw, and his forces around New York had been bolstered in the summer of 1780 by a significant number of French troops. While the British spent three years trying to control the southern colonies, Continental troops had won a few victories and the main British force under Lord Cornwallis had left the Carolinas, marching into Virginia. Still, despite these positive developments, colonial finances remained bleak indeed.

“In modern wars the longest purse may chiefly determine the event,” lamented Washington in 1780, as the commander of the new Continental Army acknowledged that the British “system of public credit is such that it is capable of greater exertions than any other nation.” One of the greatest challenges facing the Continental government was the eighteenth-century American economy. The reality confronting the Founding Fathers was that they had no effective centralized government entity to collect funds and taxes to support the war.

During the revolution, the thirteen colonies supplied money and provisions sporadically, governed by the mercurial wills of colonial leaders with decidedly provincial mindsets. Key Continental officials from George Washington to Benedict Arnold used their personal funds to buy supplies for their troops and pay informants. Individuals, most notably Robert Morris, set up and managed revolutionary finances using initiative and perseverance. Morris, known as financier of the revolution, was a shipper and banker before the war. He profited greatly from privateering but also raised $10,000 for Washington’s army just before the critical events at Trenton and Princeton in late 1776 and early 1777, keeping the army operational.

The lack of sufficient funds meant that the Continental Army usually was unpaid or underpaid, a situation that affected the enlistment and retention of troops, not to mention their morale. As the war continued, many Continental soldiers went without good shoes or boots, even in winter. This scarcity of clothing and supplies contributed to the army’s tragic noncombat death toll. Modern historians estimate that eight times the number of Americans died of deprivation and disease in the Revolutionary War as died in combat.

Throughout the revolution, the shortage of widely accepted currency severely diminished the ability of the agriculture-based colonies to purchase manufactured goods on world markets. The revolutionaries obtained critical supplies by trading and smuggling through the West Indies, an important theater in the wider conflict between the British and the French, Spanish, and Dutch. Money and financing became increasingly important each year the war continued, and the patience and patriotic enthusiasm of American citizens were sorely tested, worn by the frightening reality of war against a well-supplied, well-financed empire.

King George III, who would suffer from terrible seizures of mental illness throughout the last years of his reign, was lucid and confident when he stated in September 1780: “America is distressed to the greatest degree. The finances of France, as well as Spain, are in no good situation. This war, like the last, will prove one of credit.”

Spain’s involvement began before the American Declaration of Independence. In May 1776, French King Louis XVI directed that the Continental Army be given one million livres in munitions and supplies through a fictitious firm, Roderigue Hortalez & Co. Informed of the French gift, Charles III of Spain matched it with another million, also funneled to the colonies through the dummy firm. The two Catholic Bourbon monarchs on the French and Spanish thrones continued to assist the American Revolution, more to divert British resources than from a desire to aid the revolutionary cause.

In 1777 the former Spanish prime minister and then ambassador to the French court Pablo Jerónimo, marqués de Grimaldi, had authorized aid for the Americans. The firm of Gardoqui e Hijos of Bilbao managed substantial portions of the supply chain by sea. The worldly Basques were active merchants throughout the Americas, having used their global trading networks to market a critical eighteenth-century New England cash commodity: cod. The Basques were an effective and discreet conduit for supplies such as blankets and clothing, although the British had established a blockade of trade goods. The firm routed gunpowder and supplies from Mexico and other locations in Central and South America to the ports of New Orleans and Havana, and then shipped them north to the Continental Army.

Benjamin Franklin confirmed this contribution in a report to the Committee of Secret Correspondence from Paris in March 1777. Franklin wrote of the assistance given by the Spanish at this early date, stating that colonial ships would be admitted into Havana under most-favored-nation status and that the Spanish would arrange a credit for the colonies through Holland, to be expected in Paris at the end of the month. Franklin also noted that three thousand barrels of gunpowder would be available in New Orleans and that the merchants in Bilbao “had orders to ship for us such necessaries as we might want.”

In August 1777, the Spanish minister of the Indies, José de Galvéz, instructed the governor of Havana to send “observers” to the American colonies. One of the first of these observers, Juan de Miralles, arrived by sea in Charleston in January 1778, under the pretext of making a forced landing due to bad weather. De Miralles, from an established, wealthy merchant family in Havana, was fluent in English and had extensive business dealings with Robert Morris. He remained in the colonies as an informal diplomat and orchestrated the import and export trade between the colonies and Cuba. De Miralles often spent time at Washington’s headquarters.

De Miralles was a force behind the active merchant trade between the colonies and Havana, with wheat flour as the key commodity exported from colonial America to Cuba. He had initially underwritten the flour trade to smuggle his intelligence reports back to Cuba. This international trade expanded through 1781 and onward, becoming so extensive that it would form a line item in the official treasury report Robert Morris submitted in 1785, which listed “Bills of exchange sold, including Havana bills and bills for flour.” By this time Congress had accepted the plan Morris submitted to form a national bank. As financial agent of the Bank of North America, Morris was functioning as secretary of the treasury for the thirteen colonies.

In April 1780, despite daily treatment by Washington’s personal physician, Juan de Miralles died of “pulmonic fever” at the Ford House, Washington’s official residence at his military camp in Morristown, N.J. Washington wrote a letter of condolence to Don Diego José Navarro and sponsored a memorial service at the Continental Army headquarters. De Miralles was succeeded by his assistant, Francisco Rendón, who remained in America through the end of the war.

Philadelphia’s merchants prospered from the growing Latin trade, and many were able to purchase their own vessels. Some of the ships were named after prominent Cuban personalities, including Navarro and Miralles’ widow, Doña María Elegio de la Puente. One vessel was christened La Havana. By 1781 Cuba had become Philadelphia’s key trading partner, in part due to the British seizure of St. Eustatius in the Caribbean that February. During that year, more than half the vessels that ran the British blockade to enter Philadelphia originated in Havana.

IN THE MEANTIME, THE FRENCH COURT had decided to move beyond financing and supplying the American Revolution to deploying professional troops in North America under a seasoned commander, Jean-Baptiste Donatien de Vimeur, comte de Rochambeau. When Rochambeau and his forces landed in July 1780, they found Washington’s army in what appeared to be an astonishingly distressed condition. The Continentals’ lack of an effective navy was also obvious.

Throughout the war, the Continental Navy was able to commission only about fifty ships, which were pitted against a massive British fleet. The British had adopted the technique of shielding ship hulls with copper plates to increase speed and deter marine growth. Improved shipping gave the British a decided advantage in blockading ports, and control of the seas allowed them to move troops and supplies along the eastern seaboard at will.

General Henry Clinton, commander in chief of British forces in North America since May 1778, then headquartered in New York, understood the advantage of British naval power. He planned to dispatch a fleet under Rear Adm. Samuel Hood to reinforce Cornwallis at Yorktown. But French Rear Adm. de Grasse and his Spanish and Latin American allies had other plans.

DURING THE EIGHTEENTH CENTURY, the balance of population and wealth lay with the Spanish empire in the Americas. Mexico City, with a population of one hundred fifty thousand, was five times as large as Philadelphia, the most populous city in British North America, and ten times the size of Boston. The silver mines of Mexico and Bolivia and gold mines in upper Peru were then the richest in the world and formed the base of the wealth exported to Spain. A strong labor force of indigenous people, now managed by Spaniards and other Europeans, worked in these perilous mines.

Toward the end of the century, this indigenous population was recovering from the slaughter and disease the Spanish had brought in their initial conquests and efforts at subjugation. The total population in the Caribbean and Spain’s Latin American empire was estimated at twenty to twenty-two million, thirteen million of them Indian.

Havana had been considered the “Key to the New World” for over two hundred fifty years. The city’s protected port was the shipping hub for the gold, silver, and wealth of the Spanish empire. Havana in the 1780s was prosperous, elegant, and a critical trading partner with the beleaguered colonies. The Spanish silver dollar was widely circulated in North America as a sound alternative to the increasingly inflated American Continental paper currency.

The West Indies was also the exchange point for cash transactions between the French and the Spanish courts. As greedy pirates and privateers prowled the seas and the British actively protected their possessions in the West Indies, shipping gold and silver was risky in this region. Instead, the French court would transfer money to the Spanish in Madrid and would be repaid through currency transactions in the West Indies. This method ensured that both countries would have the funds they needed for operations in their respective theaters of war.

Political leaders in Havana included the minister of the Indies, José de Gálvez, and his nephew, Bernardo de Gálvez. Francisco Saavedra de Sangronis was one of the Gálvez family’s important protégés. Born in 1746 (the same year as Francisco José de Goya, who would later paint his portrait), Saavedra was educated, urbane, and insightful—an excellent selection as diplomatic emissary assigned to the strategic West Indies in 1779. His mission was to promote the Spanish–French alliance and joint military operations against the British and to ensure the movement of finances for this effort. King Carlos III approved of his appointment and mission.

Saavedra spoke and wrote French fluently, translating the works of French military writers into Spanish. His favorite books included the works of Horace, Plutarch, Caesar, and Tacitus, and he was an eloquent and thorough correspondent. The man who would play a vital role in forcing the British army to surrender at Yorktown wrote a detailed journal of the events that ensured victory for the French and the Continentals. Saavedra also recorded his insights and perceptions on the American Revolution. Among his most prescient observations: “What is not being thought about at present, what ought to occupy the whole attention of politics, is the great upheaval that in time the North American revolution is going to produce in the human race.”

Saavedra’s role has been overlooked by many historians, his position often described as that of a “customs director” who Rear Adm. de Grasse had to persuade to provide assistance. He actually was an official of the secretary of state and of the General Bureau of the Spanish Indies.

The prospects for the thirteen colonies in 1781 appeared bleak. “We are at the end of our tether, and…now or never our deliverance must come,” wrote a discouraged George Washington in April. The rebellion was in its seventh year. The strain of supporting the conflict and deprivation brought on by the British blockade continued to crush the economy. A nightmarish smallpox epidemic ravaged the populace.

As the government printed more money, Continental currency continued to hyperinflate. The council in Philadelphia began publishing the month-to-month rates of currency to specie, which weary consumers then multiplied by three. When the currency finally collapsed in May 1781, its ratio to specie was officially 175 to 1, or 525 to 1 by public reckoning. A spirited procession was staged in Philadelphia to mark its collapse, with people marching with dollars in their hats as paper plumes. An unhappy dog trotted alongside, tarred and pasted with the worthless paper.

From the marquis de Lafayette, whose forces had shadowed Lord Cornwallis in Virginia, Washington knew that the British commander had entrenched his forces at Yorktown, in a potentially fatal position. Knowing that a French fleet was headed for Cuba, Washington and Rochambeau devised a plan to move many of their forces south and spring a surprise trap on the British army. The French navy’s coordination was crucial, since Cornwallis could use the British fleet to remove his troops unless the French could break the British control of the Chesapeake Bay.

As he planned for the Yorktown campaign, Washington was desperate for hard currency to pay his troops. He wrote to Robert Morris: “I must entreat you, if possible, to procure one month’s pay in specie for the detachment under my command. Part of the troops have not been paid anything for a long time past and have upon several occasions shown marks of great discontent,” an understated reference to the mutinies by some Continental troops and the general unrest among many.

At this point in the summer of 1781, the French war chest in North America was also depleted. A shipment of gold was due to arrive in Boston sometime in the early fall, but with the dangers and unpredictability of overland transport, Rochambeau knew that he could not depend on these funds for the Virginia campaign. He wrote to de Grasse on June 6, 1781, stating that his funds were insufficient to maintain his army longer than August 20, and he felt that it was impossible to secure the needed gold or silver specie at any price.

Rochambeau also shared his knowledge of the condition of the Continental Army: “I should not conceal from you, M. l’Amiral, that these people are at the very end of the resources or that Washington will not have at his disposal half of the number of troops he counted upon having. While he is secretive on this subject I believe that at present he has not more than 6,000 men all told.”

Rear Admiral de Grasse would command French sailors and marines on French ships for the most decisive naval battle of the American Revolution. On March 22, 1781, de Grasse had sailed for the Caribbean with an armada of more than twenty ships of the line, leading a convoy of a hundred and fifty French merchant vessels. He also ferried infantry reinforcements for Rochambeau. His command ship was Le Ville de Paris, reportedly the largest warship on the seas when it was launched. Le Ville de Paris was an imposing vessel with one hundred ten cannons on three gun decks. The admiral’s mission was to reinforce the French possessions in the West Indies and then to turn toward North America.

Fully briefed on the gravity of the situation when he arrived in Cuba and anxious to sail north, de Grasse corresponded with Spanish authorities in Cuba and with Bernardo de Gálvez in New Orleans. De Gálvez, governor of Louisiana (and nephew of Jose de Gálvez), was also the senior Spanish military commander. He had defeated British forces at Natchez and Baton Rouge in 1779, captured Mobile the next year, and in May 1781 had taken the British capital of West Florida, Pensacola, effectively leaving the British with no Caribbean base other than Jamaica.

Although he was eyeing the British naval base at New Providence in the Bahamas (which he would capture the following year), and he had authority to request the French fleet’s support, de Gálvez had already determined to release these ships, as well as the French corps at Santo Domingo that had been placed in Spanish service. De Gálvez instructed Francisco Saavedra, then in Santo Domingo, to confer with de Grasse about “the operations that must be executed.”

On June 19, 1781, Juan Ignacio de Urriza, intendant in Havana, wrote de Gálvez, stating that “following the Real Orden of March 17, [they] had prepared beforehand for the delivery of one million pesos to the French commanders.” Urriza added that this same day they had received a sealed letter from the viceroy of New Spain advising that warships would soon be available to sail from Vera Cruz with all or at least part of the needed money.

On July 16, de Grasse arrived in Santo Domingo. Five more ships joined the admiral’s fleet, having recently returned from the victorious joint expedition with Bernardo de Gálvez in Pensacola.

Saavedra had arrived in the French Cape on July 12 and later dined with the French officers aboard Palmier. At the dinner, he learned that the frigate Concorde had carried to the French Cape an interesting cargo. He wrote of “twelve harbor pilots experienced in those northern seas, about whom there was much secrecy. This indicated that Comte de Grasse must be going to lead an expedition to those parts.”

Saavedra and de Grasse met for the first time on July 17, 1781, and Saavedra joined de Grasse at dawn the next day on board Ville de Paris. The two representatives developed an impressive list of options to

harass the British. They agreed that de Grasse and his fleet would take possession of the Chesapeake Bay, moving inland via the rivers to “cut off the retreat and prevent the reinforcement of the army of Lord Cornwallis who was in that area. At the same time, General Washington, Comte de Rochambeau, and the Marquis de Lafayette, who had already agreed to the plan, would encircle him on all sides with their respective troops and totally destroy him or oblige him to surrender.”

De Grasse was planning to take no more than twenty-four ships of the line in order to leave five or six vessels to protect French commerce. He suggested that four Spanish ships could join his fleet as they headed to the Chesapeake. Saavedra noted that “because Spain had not yet formally recognized the independence of the Anglo-Americans, there could perhaps be some political objection to taking a step that appeared to suppose this recognition.” However, Saavedra reasoned, de Grasse could take all of his combat ships to the Chesapeake if four Spanish ships protected the French merchant ships in Santo Domingo, and de Grasse accepted the proposal.

With the naval campaign plans formed, de Grasse then turned to Rochambeau’s request that he raise 1 million livres or more in specie and bring it with his reinforcements to the Chesapeake Bay. This assignment proved to be challenging, even for a man as formidable as de Grasse. His first step was to meet with merchants and planters of the Cape of France, offering the collateral of his own plantations in Haiti.

Saavedra wrote that in late July de Grasse had printed notices posted on the street corners of the French Cape, offering bills redeemable at the treasury of Paris at a profitable rate of interest in return for hard currency. Having experienced unacceptable delays in the past when lending to their court, the French citizens of Santo Domingo declined, even at the twenty-five percent interest rate offered. De Grasse wrote on August 3 from the Cape to the Spanish leadership in Havana, asking for a loan of half a million pesos.

De Grasse again conferred with Saavedra, who reassured him that he was certain the silver would be available in Havana. He was expecting it to be shipped from Mexico, from the mines in Zacatecas and Chihuahua. Saavedra wrote that he left for Havana on August 5 on Aigrette, arriving on August 15, and went to see “the generals, then the intendant and the treasurer.” However, Saavedra soon learned that the expected shipments with specie from Mexico had not arrived. The Spanish people in Puerto Rico and Santo Domingo had contributed a hundred thousand pesos for the cause, but this was not nearly enough, and Havana’s official treasury temporarily lacked gold and silver.

Saavedra acted quickly, turning to the Spanish and Cuban residents in Havana for assistance. On August 16, he later recorded, “the announcement was promulgated among the citizens, and it was proclaimed that anyone who wished to contribute towards aiding the French fleet with his money should send it immediately to the treasury. Two French officers went to collect the funds, and in six hours the requisite amount was gathered.”

After receiving the funds, de Grasse immediately sailed for the Chesapeake with his fleet. Spy ships prowled West Indies waters, and de Grasse feared that the British would learn details of his mission. Realizing he was critically pressed for time to reach Yorktown, the admiral decided to take his fleet through the old Bahamian Channel, described by José de Gálvez as “the famous dreaded channel, where no French fleet had ever passed.”

The Spanish authorities well understood the potential im-pact of their funding of Yorktown on the outcome of the Revolutionary War. King Carlos III promulgated an official notice on September 5, 1781, the same day the British fleet sailing from New York to relieve the Yorktown siege first encountered de Grasse’s warships, and long before the king knew the outcome. This document establishes the king’s great satisfaction with the assistance the citizens of Havana rendered in lending half a million pesos in “the briefest time” to the comte de Grasse and the French squadron under his command.

In later official Spanish testimony recorded on December 7, 1781, the leading naval officer in the region, General José Solano, also discussed the king’s review of the incident and the response of the citizens in Havana. By then Cornwallis had surrendered, and Solano noted “with great pleasure the gains in the North, the effects of the aid with the triumphs are well known.”

OF COURSE, THESE DEVELOPMENTS WERE CRUCIAL as a worried General Washington and his staff marched south, awaiting news of de Grasse. The reaction of the normally reserved Washington to de Grasse’s arrival underscores the importance with which the commander in chief viewed the French naval reinforcements. A bemused Rochambeau spotted Washington “waving his hat at me with demonstrative gestures of the greatest joy. When I rode up to him, he explained that he had just received a dispatch…informing him that de Grasse had arrived.”

De Grasse wrote Rochambeau on August 30 from aboard Le Ville de Paris, anchored in the Chesapeake Bay, noting his “great pleasure” in arriving at the bay after departing from Santo Domingo on August 3. He said that he had needed to first cruise to Havana for the 1.2 million livres, and he was ferrying the thirty-two hundred reinforcements that Rochambeau had requested.

The spies that de Grasse had feared alerted a furious Sir Henry Clinton to many of the details of the French fleet from Havana, including how quickly a substantial war chest had been raised. Assuming British control of the coast, Clinton had ordered Cornwallis to take a defensible position in Tidewater Virginia. He was also sure that the main American army was facing his forces in New York, and was genuinely surprised that Washington had tricked him. He immediately realized the peril Cornwallis faced.

Clinton fully understood how this fresh infusion of funds could rejuvenate the exhausted rebels. Referring to the preparations by the Continental Army for the Yorktown campaign, Clinton wrote in his memoirs: “as the hard money…procured from the Havana (amounting in a very short time, as was reported to me, to half a million dollars)…was beginning to give a life and figure to all their measures, I had proposed to the Admiral [Hood] a plan for shutting up that port [Philadelphia, where the Continental Congress met] and attempting such a blow against the place itself as might disperse the Congress, ruin public credit, and totally overset their schemes and preparations for the campaign.”

De Grasse’s swift arrival, with its timing decidedly affected by the speed of the collection of funds from Havana, was harrowingly close for eighteenth-century military maneuvers. On September 1, the British fleet under Rear Adm. Thomas Graves sailed from New York for the Chesapeake. From his ninety-eight-gun flagship London, Graves commanded nineteen ships of the line and nine frigates. In the dawn light of September 5, Graves sighted the Chesapeake capes. De Grasse’s men too were on the lookout early that morning, but for a French squadron coming from Newport, Rhode Island, under Jacques-Melchior Saint-Laurent, comte de Barras, that were heading south with supplies for Lafayette. The sailors in de Grasse’s fleet soon realized that the oncoming ships plowing across the seas were British. They quickly sprinkled the decks with sand to soak up the blood that would be splattered in the morning battle.

De Grasse would enter the battle with his entire fleet, as arranged by Saavedra, and could bring at least two hundred more cannons to bear than Graves. But the British were also handicapped by faulty communication. As the ships closed, heading south, the two fleets forming a V, Graves signaled “bear down and engage the enemy” but Hood’s ship continued to signal “line ahead.” Only eight British ships fired against fifteen French vessels in the 90 minutes of sharp fighting that ended with nightfall. Wood shattered, canvas sails ripped, cannonballs screamed through the air, and the cries of wounded and dying rolled across the blue and white waves. Finally, both sides halted to appraise the damage and briefly mourn their dead. The British flagship and five others were badly damaged, while the French suffered only minor damage and lost about two hundred dead and wounded. Neither side wishing to resume fighting, they drifted south for several days, reaching the vicinity of Cape Hatteras, North Carolina.

When de Grasse could no longer see the British fleet, he feared they might have turned toward Yorktown, so he sailed back to the Chesapeake, finding de Barras waiting for him.

The British held a council of war at which Graves and Hood concluded that given “the position of the enemy, the present condition of the British fleet…and the impracticability of giving any effectual succour to General Earl Cornwallis…it was resolved the British squadron…should proceed with all dispatch to New York.” The British ships withdrew, leaving Cornwallis and his army to defend themselves against the combined American and French forces. When a shocked King George heard the news of the defeat of his navy at the Chesa­peake capes, he confided to the earl of Sand­wich in a decidedly different tone than his pronouncements of September 1780, “I nearly think the empire ruined…this cruel event is too recent for me to be as yet able to say more.”

On October 17, Cornwallis realized his position was hopeless. After a siege of twenty-one days, he surrendered his seventy-two hundred men at Yorktown.

General Washington and his wife Martha ended the tumultuous year of 1781 as guests of the Spanish in Philadelphia. Francisco Rendón hosted the Washingtons at his home during the Christmas holidays. They had brought their own food, housewares, and cook, but Rendón graciously insisted that the king of Spain intended to meet all of their domestic needs. In a letter to José de Gálvez reporting on the Washingtons’ holiday, Rendón wrote that he “interpreted their acceptance of his hospitality as a gesture of respect for the Spanish King.”

The financial assistance at Yorktown from Havana represented the most critical support provided by the Spanish and Latin Americans during the Revolutionary War, but it was far from the only assistance they rendered. From the Mexicans who mined the silver to supply Havana to the victorious Spanish and Latin American troops who defeated the British at Pensacola, many Latinos played an important though largely overlooked role in America’s successful bid for independence. It is a legacy that should not be forgotten.