4. Baring & Hope Anticipate Financing the Louisiana Purchase

Labouchere’s letter of January 30, 1803 to Alexander Baring explains in detail how the financing of the cession of New Orleans from France to America could be done by the two houses of Baring & Hope. They would deal separately with each country as private firms. To “grease the wheels,” moreover, bribes would be paid to key individuals in each government. Profits would be substantial, but approval had to be obtained from Sir Francis Baring and Henry Hope in London before Alexander could move ahead. Once negotiations began in Paris, however, Alexander had to act on his own, but with the benefit of additional advice and notes from both Labouchere and Sir Francis. The ultimate deal was different, however, in several respects. The scale of financing was doubled as the entire Louisiana Territory was now ceded, not just New Orleans and the Floridas. Further, the United States accepted the payment directly to its merchants for their claims on French privateers, leaving Baring & Hope dealing only with the U.S. bonds issued to cover payments to France. Clearly, Alexander had negotiated brilliantly to obtain the joint agreement of the French and American ministers to confide the entire transaction to him as the agent of the joint houses of Baring & Hope.