This was General Washington's lament in 1780, as he acknowledged that the British "system of public credit is such that it is capable of greater exertions than any other nation."[1]  The domestic finances of the eighteenth-century American economy were one of the greatest challenges facing the Continental Army. The reality that Founding Fathers and Mothers confronted was that there was not an effective centralized government entity to collect funds and taxes to support the war.  This lack of funding for critical supplies exacerbated the terrible toll on the Continental Army, which experienced severe shortages of the essential commodities needed to fight the Revolution. During the Revolution, money and provisions were supplied at the mercurial wills of the thirteen colonies with decidedly provincial mind sets. Key leaders of the revolution, from George Washington to Benedict Arnold, used their personal funds to buy supplies for their troops and pay informants. Revolutionary finances were established and managed by the initiative and perseverance of singular individuals, such as Robert Morris who spent years in the Revolution signing short-term and long-term debt notes termed as "Short Bobs" and "Long Bobs". The personal credit of Robert Morris, who would much later die in debtors prison, was deemed as trustworthy, while that of the United States of America was not. The lack of funds also meant that the Continental Army usually was unpaid and underpaid, a situation that impacted the enlistment and maintenance of troops and that would be perilous at the time of the Battle of Yorktown.

     The shortage of hard currency severely diminished the ability of the agricultural based colonies to purchase manufactured goods on world markets. Paul Revere and the well-organized riders on that chilly spring New England night were not only spreading the news of the arrival of British troops, but also protecting Concords critical stores of gunpowder, all of which had been imported.[2]  Benjamin Franklin admitted in Paris that by December 1776 the country was almost out of gunpowder, "This was kept secret from even our people. The world wondered that we so seldom fired a cannon. We could not afford it."[3]  Immediately after the surrender of Hessian troops at the Delaware in 1776, one of the first actions by the ragged American soldiers was to commandeer the winter coats of their prisoners the Continental army was in rags, and the warm European clothing was eagerly snatched.[4] Many soldiers of the Continental Army were without shoes or boots even in winter, and the fabled reports of bright red blood smeared on the trampled crisp snow as the troops marched in the winter are all too true. These scarcities of clothing and supplies contributed to the tragic non-combat death toll of the troops; twentieth- century historians estimate that eight times the number of Americans died of deprivation and disease in the Revolutionary War than the total deaths in combat.[5] 

     The Revolutionaries obtained critical supplies by trading and smuggling through the West Indies, an important theater in a wider European conflict among the French, Spanish, British, and Dutch. Money and financing became increasingly important as the duration of the war lengthened, and patience and patriotic enthusiasm were increasingly 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."[6]

"As well as Spain..."

     Much historical writing in the nineteenth and twentieth centuries interprets the delay of the Spanish government to join the French in overtly declaring war on the British as an indication of hostility or indifference to the American Revolution. Spain is also portrayed as fearing for the demise of its own colonies in the southern sphere of North America. This perspective decidedly reflects the nineteenth-century rise to power of United States as it pushed its westward and southern expansion, and does not represent the realities of the eighteenth century. The scenario for Spanish involvement in the American Revolution, as well as the noteworthy individuals who acted decisively at critical junctures, is far more complex and colorful.

     As well as the French, the involvement of the Spanish began prior to the American Declaration of Independence. In May 1776, the French King directed that one million livres (unit of French specie) be supplied to the Continental Army as munitions and supplies, with the assistance of Beaumarchais, a leading figure in the Enlightenment. Beaumarchais undertook the assignment disguised as a private trader under the fictitious name of Roderigue Hortalez and Company. Informed of the gift of a million, "under the title of a loan, Charles III matched it with another million, to be distributed through the same source,"[7] and this early assistance to the American Revolution became a family affair for the two Catholic Bourbon monarchs on the French and Spanish thrones.

     In early 1777, Arthur Lee, one of the Continental Congress early agents in Europe, tried to persuade the former Spanish Prime Minister and then Ambassador to the French Court, Pablo-Jeronimo de Grimaldi y Pallavicini, marques de Grimaldi, to declare an open alliance with the fledgling United States. Genovese by birth and a shrewdly calculating politico by nature, Grimaldi demurred, replying, "You have considered your own situation, and not ours. The moment is not yet come for us. The war with Portugal France being unprepared, and our treasure ships from South America not being arrived makes it improper for us to declare immediately."[8]  Meanwhile, Grimaldi reassured Lee, stores of clothing and powder were deposited at New Orleans and Havana for the Americans, and further shipments of blankets were being collected at Bilbao.[9]  Benjamin Franklin confirmed this conversation in a report to the Committee of Secret Correspondence from Paris in March 1777. Franklin writes of the assistance given by the Spanish at this early date, including 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."[10]

     Later in August 1777, the Spanish Minister of the Indies, Jose de Galvez instructed the Governor of Havana to send "observers" to the American colonies. One of the first observers, Juan de Miralles, arrived in Charleston, South Carolina in January 1778, under the pretext of a forced landing due to bad weather.[11] De Miralles was from an established, wealthy merchant family in Havana, 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 trade between the colonies and Havana, with wheat flour as the key commodity exported from colonial America to Havana. He had initially underwritten the flour trade to smuggle his intelligence reports back to Cuba. This international trade expanded through 1781 and onwards, becoming so extensive that it would form a line item in the official Treasury Report of 1785 by Robert Morris, which listed "Bills of exchange sold, including Havana bills and bills for flour."^[12]  The Philadelphia merchants prospered under these terms and were able to purchase their own vessels.  Some of the vessels were named after prominent Cuban figures, including ships named for Captain General Navarro and Miralles widow, Dona Mara Elegio de la Puente.^[13] One vessel was christened La Havana.^[14]During 1781, in part due to the British seizure of St. Eustatius in February of that year, Cuba became Philadelphia's key trading partner, with over half of the vessels entering Philadelphia originating in Havana.^[15] 

     Money and supplies were provided by the Spanish to the colonies through European based connections, notably Arthur Lee and John Jay, and in the North American theater of war, to revolutionaries such as Oliver Pollock. The firm of Gardoqui e Hijos of Bilbao managed substantial portions of the supply chain from Europe. The worldly Basques, who were noted in Franklins correspondence, were active merchants throughout the Americas, having utilized their global trading acumen and 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.  

     In the southern theater of the North American war, Oliver Pollock, a Scots Irish merchant turned revolutionary, received material and supplies under the auspices of the Spanish beginning in 1776. Gunpowder and supplies were routed from Mexico and other locations in South America to the ports of New Orleans and Havana and then shipped north to the Continental Army. Bernardo de Galvez suavely provided a pretext for early shipments in 1777, confounding the British with a clever whispering campaign that clothing had been rejected as moth eaten and not suitable for King Carlos army, with similar excuses for the rejections and disappearances of gunpowder, quinine, and muskets that later mysteriously reappeared in the supplies for the Continental Army. Later in the Revolutionary War when the Spanish openly declared War on the British, Bernardo de Galvez would initiate his attacks on the British forts in Louisiana and Mississippi with the Spanish-speaking Oliver Pollock at his side as aide-de-camp.