growing scarcity of cotton has the effect of closing more of the mills. On the other hand the rapid advance in price has so far stimulated the search for the article as to justify the expectation of a considerable addition to the supply from India. I am therefore inclined to believe that we are at the crisis of the difficulty, and from this time things will rather mend than grow worse. Thus far it has not been possible to give a political direction to the uneasiness which exists. A good deal has been done both by public and private assistance to alleviate the suffering of the poorer classes. The anxiety about the crops has been quieted, partly by the prevalence of fine weather during the harvest, and partly by the extensive importation of breadstuffs from America, which puts an end to the apprehension of famine prices. In the general trade of the country there seems to be increased activity, which, to a corresponding extent, neutralizes the unfavorable influence from America. The condition of matters on the continent is still regarded with not a little inquietude. The suppression of the indiscreet outbreak of Garibaldi has not been attended by the restoration of confidence in the established order of things in Italy. There is an obvious increase of the popular pressure upon the Emperor of France for the withdrawal of his force at Rome, which has not been thus far attended by any symptoms of yielding on his side. * * * * * * * * The breaking out of the insurrection has brought to light the existence of national feelings [in England] towards them, [the United States,] the strength of which had scarcely been suspected in America. As the struggle has gone on, the nature and extent of them has become so clear and unmistakeable as to defy all disavowal. Having their root in the same apprehensions of the force of a foreign state which exists in the case of France, they take the same direction towards efforts to curtail, if not to neutralize, its energies. The popular sentiment of Great Britain, as now developed, should be a warning to the statesmen of America by which to regulate their action, at least for two generations. It dictates the necessity of union at home far more imperatively even than the wretchedness which now fills the country with grief from end to end. It ought to open the eyes of all the honest but deluded citizens who have imagined that in resisting the authority of the federal government they are only endeavoring to substitute one kind of domestic sovereignty for another. The fact is that they are ignorantly conducing to the interposition of a wholly foreign and opposite influence, which has no sympathy in common with America, and which seeks only to base its own interests more firmly upon the decay of those of other nations. To attempt to counteract this policy by angry remonstrance or a resort to violence would be idle, if not worse. The true remedy would be to effect the restoration of peace and harmony, the revival of our habits of productive industry, and the return of vigor to the action of one government over all, inspiring confidence at home and a salutary fear as well as respect among the malevolent abroad. But if it should turn out that the malignant spirits among us prove to have so far confirmed their authority among their countrymen in some quarters as to render these results impracticable, then does the manifestation of these British proclivities open a still further question for the consideration of America. They point significantly to the future encouragement of a social organization approximated to us as closely as possible, which, because animated by the bitterest hostility to us may hence become a ready instrument to effect the object of finally annulling our influence. Thus hemmed in between the north and the south, both almost equally guided by British policy, the United States may cease to inspire that dread of their future expansion which seems to haunt the minds of their statesmen of the present day. The mode of counteracting these dangerous tendencies is deserving of most careful consideration. To permit the establishment of any such authority to the south of us as that indicated seems to be out of the question. It would be far wiser to determine that rather than this the social basis upon which it is designed to maintain it should be, once for all, removed. Whatever might be the hesitation to act whilst the question remained confined within purely domestic considerations, it will cease the moment that any extraneous element of foreign agency shall be introduced. Great Britain, after wielding the moral considerations of the slave question. for many years for the purpose of stimulating our domestic dissensions, cannot be allowed to complete her work by upholding a slaveborn authority as a perpetual check upon our prosperity. All the considerations of our safety in the distant future forbid the idea. The whole case changes its character the moment we come to look at it in this new light. Its moral become not less momentous than its political aspects. The position of the two nations is thus made antagonistic on a great issue of principle, and the protection of the great idea of human liberty becomes more than ever before the bounden duty of the United States. I have been led into this course of reflection insensibly by the incidental exposition of the gradually spreading antipathy to us among the people of this city and kingdom, as it has been shown by the reception of General Pope's announcement that we have gained a victory. Here it is viewed in the light of a disaster, and great efforts are made to discredit it. I have the honor to be, sir, your obedient servant, SIR: Mr. Morse, our indefatigable consul at London, has transmitted to this department an intercepted letter written by S. H. Mallory, who is the pretended secretary of the navy to the insurrectionary party in the south, and addressed to James H. North, who is called a commander in that navy. The letter shows that at least two steamers, the Oreto and the Florida, have been actually built, fitted up in England for the insurgents, and despatched with armaments and military stores from British ports to make war upon the United States. Mr. Morse has informed me that he intended to submit the letter to you, and it is probable that you will have taken a copy of it. For greater certainty, however, a copy is sent you with this despatch. It is thought expedient that you give a copy of it to Earl Russell. Hitherto the British authorities have failed to prevent such transactions, assigning as the reason a want of authentic evidence of the illegal character and purposes of the vessels which you have denounced. It will perhaps be useful to give the government this unquestionable evidence of the infraction of the neutrality laws, in the very two cases of which you have already complained without success. Although these two vessels are now beyond the reach of British authority, the evidence which shows that they ought to have been detained may possibly lend some probability to new complaints in regard to other vessels of a similar character now being built in England. I am, sir, your obedient servant, CHARLES FRANCIS ADAMS, Esq., &c., &c., &c. WILLIAM H. SEWARD. • S. H. Mallory to James H. North. CONFEDERATE STATES OF AMERICA, Navy Department, Richmond, July 12, 1862. SIR: Your letter of the 29th of March last reached me this morning. The department notified you, on the 11th of January last, that you would receive orders to command the second vessel then being built in England, but for reasons satisfactory to the department you were subsequently assigned to the command of the first vessel, the Florida, (Oreto,) now at Nassau; and any just ground for "the surprise and astonishment" in this respect at the department's action is not perceived. A commission as commander for the war was sent you on the 5th of May, and your failure to follow the Oreto, which left England about the 21st of March, and to take command of her as was contemplated, and as you were apprised by Captain Bullock, on the 26th of March, is not understood, and has been productive of some embarrassment. Captain Bullock was nominated by the executive for his position in the navy under existing law, and was duly confirmed by the Senate, and your protest to this department against the action of these co-ordinate branches of your government is out of place. Upon the receipt of this letter you will turn over to Lieutenant G. F. Sinclair the instructions which you may have received, together with any public funds in your hands, and return to the confederate States in such manner as your judgment may direct. Should you not be provided with funds for this purpose, Commander Bullock will, upon your application, supply them. I am, respectfully, your obedient servant, Commander JAMES H. NORTH, C. S. N., London, England. S. H. MALLORY, Secretary of the Navy. Mr. Seward to Mr. Adams. No. 341.] DEPARTMENT OF STATE, Washington, September 15, 1862. SIR: Just at the moment when the mail is about to close authentic information reaches the government that the insurgent forces which have been approaching and menacing Cincinnati and Louisville have receded, and are retreating in Kentucky. The alarm in that quarter has passed. The press has already announced that the insurgent army, which has been threatening Washington, Baltimore, and Pennsylvania, evacuated Frederick on the 12th instant. I now give you a despatch which has just been received from Major General McClellan, which shows the position of the two armies at the present moment. . I am, sir, your obedient servant, CHARLES FRANCIS ADAMS, Esq., §c., §c., §c. WILLIAM H. SEWARD. No. 345.] Mr. Seward to Mr. Adams. DEPARTMENT OF STATE, Washington, September 15, 1862. SIR: Your despatch of August 29 (No. 211) has been received. Since it was written, information, hastened by telegraph, has reached the country that Garibaldi has been wounded and captured by a French force on the coast of Calabria, and conveyed a prisoner to Spezzia. This event would seem sufficient to arrest the revolutionary movement which so lately threatened the peace of Europe. Nevertheless it remains a question of much interest whether the agitation will immediately go down or reveal itself in some new demonstrations of sympathy with its representative in his detention and sufferings. Advices from Mexico do not encourage the belief that there will be any real submission to the French or any practical acquiescence in any new government they may succeed in establishing there. I am, sir, your obedient servant, CHARLES FRANCIS Adams, Esq., &c., &c., &c. WILLIAM H. SEWARD. Mr. Seward to Mr. Adams. No. 347.] DEPARTMENT OE STATE, Washington, September 15, 1862. SIR: I herewith enclose for your information a copy of a despatch, (No. 214,) of this date, to Mr. Dayton, giving, among other things, the substance of a report recently received from General Shepley, governor of Louisiana, showing the entire freedom of the cotton market in New Orleans. I am, sir, your obedient servant, CHARLES FRANCIS ADAMS, Esq., &c., &c., &c. WILLIAM H. SEWARD. (The despatch above referred to is placed, according to date, in the correspondence with France, in this series.) Mr. Seward to Mr. Adams. No. 349.] DEPARTMENT OF STATE, Washington, September 15, 1862. Sir: Since my previous despatches were put into the mail General McClellan reports that the battle yesterday mentioned in his telegram proves to have been a complete victory. The enemy was routed, and he fled during the night. McClellan is in pursuit. 'I am, sir, your obedient servant, CHARLES FRANCIS ADAMS, Esq., &c., §c., sc. WILLIAM H. SEWARD. Mr. Seward to Mr. Adams. No. 351.] DEPARTMENT OF STATE, Washington, September 17, 1862. SIR: I enclose for your information an extract from a despatch of the 9th of June last from the minister resident of the United States in Japan, relative to the cordial relations existing between himself and the ministers of England and France in that empire. I am, sir, your obedient servant, CHARLES FRANCIS ADAMS, Esq., &c., &c., &c. WILLIAM H. SEWARD. (The extract above referred to will be found under the head of "Japan,” in this series.) Mr. Seward to Mr. Adams. No. 353.] DEPARTMENT OF STATE, Washington, September 19, 1862. SIR: Your despatch of September 4, (No 214,) has been received. It sets forth a conversation which had recently been held between yourself and Earl Russell, in which explanations were exchanged concerning a statement said to have been made by J. M. Frailey, commander of the United States steamer Quaker City, at the time of his capture of the Adela, to the effect that you had justified his alleged course in making captures of all vessels which have been indicated to him as suspected ones by the Secretary of the Navy; and that you had stated as the ground of the justification that Lord Palmerston had told you that the American naval authorities might catch all such vessels if they could. The explanations and disclaimers which you made in reply seem to have been as satisfactory to Earl Russell as they were just. I have referred to your despatch of the 15th of November last, in which you gave to this department an account of your interview and conversation with Lord Palmerston, on the subject of the appearance of the American shipof-war the James Adger in British waters, the only one in which you have given me any relation of any interview with Lord Palmerston in regard to the operations of enforcing the blockade, or to violations of the neutrality laws. I find nothing in that despatch that could be construed so as to warrant the statement concerning Lord Palmerston imputed to the crew. I find, also, that the despatch was marked confidential, that it has never been presented nor even referred to the Navy Department. It results that this report does not originate from any communications you have ever made to this department. I apprehended, rather, that if the statement has indeed been made by Commander Frailey, he must have given it upon some one of the thousand rumors which the press of both countries is in a habit of publishing as a part of the news of the day. With a view to prevent any misunderstanding upon the subject, I will ask the Secretary of the Navy to communicate to the admiral of the blockading squadron so much of the despatch now before me as relates to the crew's report, and I will further ask him to call Commander Frailey's attention to |