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Monthly Record of Current Events, December 2.

UNITED STATES.
CONGRESS convened on the 2d of December. The President's Message was presented on the following day. We give an abstract of its leading features; — Our Foreign Relations have occasioned profound solicitude. A nation which endures factious divisions at home is exposed to disrespect abroad; one or both parties is sure to invoke foreign intervention, and other nations are not always able to resist the temptation thus presented. But the disloyal citizens of the United States have met with less encouragement than they expected. Even if foreign nations were disposed to act solely for the speedy restoration of commerce, including especially the acquisition of cotton, they do not as yet appear to have seen their way more clearly through the destruction than through the preservation of the Union. They can not have failed to perceive that the Union has made our foreign as well as our domestic commerce; and one strong nation promises more durable peace, and a more extensive and reliable commerce than can the same nation when broken into fragments. Still the integrity of our country depends upon ourselves, not upon foreign nations, and as foreign dangers attend domestic difficulties, the President recommends the ample maintenance of our national defenses, especially those of our sea-coast, lakes, and great rivers. — He urges that Congress should provide for the speedy construction of a Military Railroad, connecting the loyal portions of Tennessee, North Carolina, and Kentucky with the other faitliful parts of the Union. — He recommends that for the Protection of our Commerce, especially in the Eastern Seas, commanders of sailing vessels be authorized to re-capture prizes which may be made by pirates, and that the consular courts be empowered to adjudicate respecting such prizes, where this is not objected to by the local authorities. — He sees no good reason why we should longer refuse to recognize the independence of Hayti and Liberia, and suggests the appointment of a Charge d'Affairs at each of these States. — The operations of the Treasury have been conducted with signal success. The patriotism of the people has placed at the disposal of Government the large sums demanded by the public exigencies. The following is a summary of the receipts and expenditures:
Revenue from all sources, including loans, for the financial year ending June 30, 1861 $86,835,900 27
Expenditures, including payments on account of public debt 84,578,034 47
Leaving balance, June 1,1881 $2,257,805 80
Revenue for the first quarter of the present financial year, including the above balance$102,532,509 27
Expenditures for this quarter 98,239,733 09
Leaving balance, October 1,1861 $4,202,776 18

— The estimates for the Treasury and the Statistics of the Army and Navy will be found in the Reports of the Secretaries for those departments. — In the Supreme Court are three vacancies, two by the decease of Justices Daniel and M'Lean, and one by the resignation of Justice Campbell. No nominations have been made to fill these, since two of them occur in the revolted States, and they could not now be filled in those localities, and the President is unwilling to make all the appointments Northward, disabling himself from doing justice to the South on the return of peace. He suggests, however, that the transfer of one of these to the North would not, with reference to territory and population, be unjust. Various suggestions are made for modifications in the Supreme Court. — The condition of our Statute Law is suggested to demand improvement. Since the formation of our Government Congress has passed some 5000 acts, which fill more than 6000 closely printed pages, and are scattered through many volumes. Many of these are obscure, and apparently conflicting, so that it is difficult to know what our statute; law really is. It is believed that all acts of a permament and general nature, now in force, might bo revised and re-written, so as to be contained in one or two volumes of convenient size. — Civil Justice has been suppressed in the insurgent States. It has been estimated that two hundred millions of dollars are due from insurgent to loyal citizens, but there are no courts to enforce these claims. The President has been urged to establish military courts to administer summary justice in such cases, wherever our armies take possession of revolted districts. He has declined to do so, because he was unwilling to go beyond the pressure of necessity in the unusual exercise of his power. He recommends Congress to provide for this emergency by the establishment of temporary tribunals, to exist only till the ordinary courts can be re-established. — To facilitate the settlements of Claims against Government, it is suggested the Court of Claims should have the power to make its judgment final, under such restrictions as may be found desirable. — The relations of the Government with the Indian Tribes have been disturbed by the insurrection. The Indian country south of Kansas is in possession of the insurgents; and it is said that a portion of the Indians have been organized into a military force attached to the insurgent army. Letters, however, have been received from prominent chiefs desiring the protection of the troops of the United States. The President believes that upon the re-possession of thecountry by the Government the Indians will readily resume their former relations. — An important paragraph in the Message relates to the disposition to be made of Slaves. We give this suggestion at length:

"Under and by virtue of the act of Congress, entitled ‘An Act to Confiscate Property used for Insurrectionary Purposes,’ approved August 6, 1861, the legal claims of certain persona to the labor and service of certain other persons have become forfeited, and numbers of the latter, thus liberated, are already dependent on the United States, and must be provided for in some way. Besides this, it is not impossible that some of the States will pass similar enactments for their own benefits respectively, and by the operation of which persons of the same class will be thrown upon them for disposal. In such case I recommend that Congress provide for accepting such persons from such States, according to some mode of valuation, in. lieu protanto of direct taxes, or upon some other plan to be agreed on with such States respectively, that such persona, on such acceptance by the General Government, be at once deemed free; and that in any event steps be taken for colonizing both classes, or the one first mentioned, if the other shall not be brought into existence, at some place or places in a climate congenial to them. It might be well to consider, too, whether the free colored people already in the United States could not, so far as individuals may desire, be included in such colonization."

— The Message embodies a brief dissertation upon the views as to Labor and Capital which are involved in the present struggle. It is assumed, says the President, on the one side, that labor is available only in connection, with capital; that nobody labors unless some one who owns capital induces him to do so; then it is considered whether it is better that capital shall hire laborers, inducing them to

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work with their consent, or buy them, forcing them to work without their consent; in either case it being taken for granted that the condition of a laborer is one fixed for life. The President combats this whole theory. Labor, he says, is prior to and the source of capital, and deserves the higher consideration. Nor is there any fixed position of laborer and capitalist. A large majority of citizens, both at the North and the South, neither work for others nor have others working for them; many both labor with their own hands and hire others to labor for them; and then again the laborer of to-day is not unfrequently the employer of tomorrow. This system opens the way to all, and gives hope to all. No men are more worthy to hold political power than men who toil up from poverty; let them beware of surrendering a political power which they possess. The Message concludes thus:
"From the first taking of our national census to the last are seventy years, and we find our population at the end of the period, eight times as great as it was at the beginning. The increase of those other things which men deem desirable has been even greater. We thus have, at one view, what the popular principle, applied to government through the machinery of the States and the Union, has produced in a given time, and also what, if firmly maintained, it promises for the future. There are already among us those who, if the Union be preserved, will live to see it contain 250,000,000. The struggle of to-day is not altogether for to-day. It is for a vast future also. With a firm reliance on Providence, all the more firm and earnest let us proceed in the great task which events have devolved upon us."

The Report of the Secretary of War presents the following estimate of the strength of the army, both volunteers and regulars:

 Volunteers.
States.Three Months.For the War.Aggregate.
California4,6884,688
Connecticut2,23612,40014,636
Delaware 7752,0002,775
Illinois 4,94180,00084,941
Indiana4,68657,33262,018
Iowa96819,80020,768
Kentucky15,00015,000
Maine 76814,23915,007
Maryland7,0007,000
Massachusetts 8,43526,76030,195
Michigan 78128,55029,331
Minnesota 4,1604,160
Missouri 9,35622,13031,486
New Hampshire 7799,60010,379
New Jersey3,0689,34212,410
New York 10,188100,200110,388
Ohio10,23681,20591,441
Pennsylvania19,19994,760113,959
Rhode Island1,2855,8987,183
Vermont7808,0008,780
Virginia77912,00012,779
Wisconsin7921415314,945
Kansas50005000
Colorado1,0001,000
Nebraska2,5002,500
Nevada1,0001,000
New Mexico 1,0001,000
District of Columbia 2,8231,0003,823
Total77,875640,637718,512

— To the number of volunteers for the war, 640,637, add the estimated strength of the regular army, including the new enlistments, under the Act of July 29, 1861, which is 20,334, and our entire military force now in the field will be 660,971; the several arms of the service being distributed as follows:

 Volunteers.Regulars.Aggregate.
Infantry557,20811,175568,383
Cavalry54,6544,74459,398
Artillery20,3804,30824,688
Rifles and Sharp-shooters8,3258,395
Engineers 107107
Total640,63720,334660,971

— For the ensuing year appropriations are asked for a force of 500,000 men. The cavalry force is found to be larger than is required, and measures will be taken for its reduction. The Secretary gives a condensed history of the enlistment of the army, and shows that it may easily be raised to any required number. He says that, at one time during the Revolution, Massachusetts, with a population of 350,000, had in the field 56,000 troops — more than one-sixth of her entire population. Should the loyal States furnish troops in like proportion, which they would do if the emergency demanded, we could put into the field an army of over three millions. — A summary is given of affairs in the " Border States." In Delaware the good sense and patriotism of the people has triumphed over the schemes of the traitors; in Kentucky the people early pronounced themselves at the ballot-box in favor of the Union; in Maryland, notwithstanding the events in Baltimore, when the opportunity of a general election was afforded, the people, under the lead of their brave and patriotic Governor, rebuked those who would have led the State to destruction; in Missouri a loyal State Government has been established, troops have rallied to the support of the Federal authority, which have forced the enemy to retire into an adjoining State; in Virginia the Government established by the loyal portion of her population is in succesful operation. The Secretary believes that "the army now assembled on the banks of the Potomac will, under its able leader, soon make such a demonstration as will re-establish its authority throughout all the rebellious States." — The Report contains many practical suggestions in respect to the arms munitions, clothing, and organization of the army, It recommends that " the advancement of merit should be the leading principle in all promotions, and the volunteer soldier should be given to understand that preferment will be the sure reward of intelligence, fidelity, and distinguished service." — The two closing paragraphs of this Report embody suggestions of such grave importance that we give them in full:

"The geographical position of the metropolis of the nation, menaced by the rebels, and required to be defended by thousands of our troops, induces me to suggest for consideraition the propriety and expediency of a reconstruction of the boundaries of the States of Delaware, Maryland, and Virginia. Wisdom and true statesmanship would dictat that the seat of the National Government, for all time to come, should be placed beyond reasonable danger of seizure by enemies within, as well as from capture by foes from without. By agreement between the States named, such as was effected for similar purposes by Michigan and Ohio, and by Missouri and Iowa, their boundaries could be so changed as to render the capital more remote than at present from the influence of State Governments which have arrayed themselves in rebellion against the Federal authority. To this end the limits of Virginia might be so altered as to make her boundaries consist of the Blue Ridge on the east and Pennsylvania on the north, leaving those on the south and west as at present. By this arrangement two counties of Maryland (Alleghany and Washington) would be transferred to the jurisdiction of Virginia. All that portion of Virginia which lies between the Blue Ridge and Chesapeake Bay could then be added to Maryland, while that portion of the peninsula between the waters of the Chesapeake and the Atlantic, now jointly held by Maryland and Virginia, could be incorporated into the State of Delaware. A reference to the map will show that these are great natural boundaries, which, for all time to come, would serve to mark the limits of these States. To make the protection of the capital complete, in consideration of the large accession of territory which Maryland would receive under the arrangement proposed, it would be necessary that the State should consent so to modify her Constitution as to limit the basis of her representation to her white population. In this connection it would be the part of wisdom to reannex to the District of Columbia that portion of its original limits which, by Act of Congress was retroceded to the State of Virginia."

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"It is already a grave question what shall be done with those slaves who are abandoned by their owners on the advance of our troops into Southern territory, as at Beaufort district, in South Carolina. The number left within our control at that point is very considerable, and similar cases will probably occur. What shall be done with them? Can we afford to send them forward to their masters to be by them armed against us, or used in producing supplies to maintain the rebellion? Their labor may be useful to us; withheld from the enemy it lessens his military resources, and withholding them has no tendency to induce the horrors of insurrection, even in the rebel communities. They constitute a military resource, and being such, that they should not be turned over to the enemy is too plain to discuss. Why deprive him of supplies by a blockade, and voluntarily give him men to produce supplies? The disposition to be made of the slaves of rebels after the close of the war can be safely left to the wisdom and patriotism of Congress. The representatives of the people will unquestionably secure to the loyal slaveholders every right to which they are entitled under the Constitution of the country."

The Report of the Secretary of the Navy furnishes a comprehensive statement of the condition of this branch of the service, and of its operations since last July. When the vessels now building and purchased of every class are armed, equipped, and ready for service, the strength of the navy will be:

OLD NAVY.
Number of Vessels.Guns.Tonnage.
6 Ships-of-line50416,094
7 Frigates35012,104
17 Sloops34216,031
2 Brigs 13539
3 Store-ships7342
6 Receiving-ships, etc1066,340
6 Screw frigates22221,460
6 First-class screw sloops 10911,953
4 First-class side-wheel steam sloops468,003
8 Second-class screw sloops 457,593
5 Third-class screw sloops232,405
4 Third-class side-wheel steamers 81,808
2 Steam tenders 4599
761783105,271
VESSELS PURSCHASED.
 Guns.Tons.
36 Side-wheel steamers16626,680
48 Screw steamers 17520,403
13 Ships529,998
24 Schooners 495,324
18 Barks 788,432
2 Brigs4460
13651871,297
VESSELS CONSTRUCTED.
 Guns.Tons.
14 Screw sloops 9816,787
23 Gun-boats 9211,661
12 Side-wheel steamers498,400
3 Iron-clad steamers184,600
5225541,448

— Making a total of 264 vessels, 2557 guns, and 218,016 tons. The aggregate number of seamen in the service on the 4th of March last was 7000. The number is now not less than 22,000. The amount appropriated at the last regular session of Congress for the naval service of the current fiscal year was $13,168,675; to this was added at the special session of last July $30,446,876 — making an aggregate for the fiscal year ending June 30, 1862, of $43,615,551. To this must be added:

For vessels purchased and alterations to fit them for service $2,530,000
For the purchase of additional vessels 2,000,000
For 20 iron-clad vessels 12,000,000
 $16,530,000
Add previous appropriations 43,615,551
Total for year ending June 30, 1862 $60,145,551

— The estimates for the fiscal year ending June 30, 1863, are as follows:

For the navy proper $41,096,530
For the marine corps 1,105,657
For miscellaneous objects 2,423,478
Total for fiscal year ending June 30, 1863 $44,626,665

— The operations of the navy have been directed to the following objects: 1. Blockading the insurgent ports along a coast of nearly 3000 miles; 2. The organization of combined naval and military expeditions to operate upon the Southern coast, and upon the Mississippi and its tributaries; 3. The pursuit of cruisers which might have escaped the blockading force. — In all 153 vessels have been captured while attempting to violate the blockade. Vessels laden with stone have been sent to be sunk in the channels of Charleston harbor and the Savannah River; this, if effectually accomplished, will interdict commerce at those ports. — The operations in the neighborhood of Hatteras and Port Royal are described at length in the Report. The escape of the Sumter, and the "feeble pursuit" made of her is mentioned; an investigation into this affair has been ordered. — The action of Captain Wilkes in capturing Messrs. Slidell and Mason is thus referred to:

"The prompt and decisive action of Captain Wilkes on this occasion merited and received the emphatic approval of the Department, and if a too generous forbearance was exhibited by him in not capturing the vessel which had these rebel emissaries on board, it may, in view of the special circumstances, and of its patriotic motives, be excused; but it must by no means be permitted to constitute a precedent hereafter for the treatment of any case of similar infraction of neutral obligations by foreign vessels engaged in commerce or the carrying trade."

— In answer to inquiries from naval commanders as to the disposition of fugitives who have sought refuge on our ships, the Secretary has directed that

"If insurgents, they should be handed over to the custody of the Government; but if, on the contrary, they were free from any voluntary participation in the rebellion and sought the shelter and protection of our flag, then they should be cared for and employed in some useful manner and might be enlisted to serve on our public vessels or in our Navy-yards, receiving wages for their labor. If such employment could not be furnished to all by the navy, they might be referred to the army, and if no employment could be found for them in the public service they should be allowed to proceed freely and peaceably without restraint to seek a livelihood in any loyal portion of the country."

— Although fugitive slaves are not expressly mentioned, this general direction is evidently intended to apply to them.

The Report of the Secretary of the Interior furnishes some interesting details. The decline of business has seriously affected the operations of the General Land Office. Sales of land have been almost wholly suspended; the net income from this source will for the present fiscal year hardly amount to $2,000,000. — Indian Affairs are in a very unsatisfactory state. The Cherokees, Chickasaws, and Choctaws have ceased all intercourse with the agents of the United States. The payment of their annuities has been suspended. The tribes on the Pacific slope of the Rocky Mountains have manifested a turbulent spirit. In New Mexico trouble has been experienced from depredations committed by some tribes. In Kansas and Nebraska the tribes are advancing in the arts of civilization. — The Patent Office, has suffered greatly by the insurrection. During the year, from January 1 to September 30,1861, the expenditures exceeded the receipts by $82,785. To meet this deficiency thirty employes have been discharged, and the salaries of the remainder have been reduced. — Many persons who have been in the receipt of Pensions have joined the insurgents; payments to them have been suspended. — The returns of the Census are being condensed for publication as rapidly as possible.

The Report of the Postmaster-General shows that the expenditures of the Department for the year

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were $13,606,759, being more than a million and a quarter less than for the preceding year, while the receipts fell short only $168,771. The deficit is $4,651,966, nearly a million and a half less than was estimated. The appropriation asked to supply deficiencies for 1862 is $3,145,000, more than two and a quarter millions less than was asked in 1861. This difference arises from the fact that the Department is not now burdened with supplying mails to the Southern States, where the expenses greatly exceeded the income.

The Report of the Secretary of the Treasury furnishes an elaborate statement of the financial condition of the Government. The following tables present in a condensed form its principal points for the financial year ending June 30, 1862:

Estimated receipts from customs, lands, and usual miscellaneous sources $36,809,731 24
Amount realized from loans, up to Dec. 1, 1861 197,242,588 14
Amount to be realized from additional loans already authorized 75,449,675 00
Amount anticipated from direct tax 20,000,000 00
Total estimated receipts for the year $329,501,994 38

The expenditures, as estimated, are:

Actual expenditures for the 1st quarter $98,239,733 09
For 2d, 3d, and 4th quarters, the estimates under appropriations already made 302,035,761 21
Estimated expenditures under additional appropriations now asked for 143,130,927 76
Total estimated expenditures for the year $543,406,422 06
Deducting the above receipts 329,501,994 38
Amount to be provided by loan for 1862 $213,904,427 68

— The Secretary hopes that the war may be brought to a close before mid-summer, in which case the revenue from sources suggested by him will be amply sufficient without resorting to new loans; but in case of the continuance of the war on its present scale, the estimated expenditures for the year ending June 30, 1863, are:

For the War Department $360,169,986 61
For the Navy Department 45,164,994 18
Account of Public Debt 42,816,330 53
For Civil List, etc 23,086,971 23
For Interior Department 4,102,962 96
Total expenditures for 1863 $475,331,245 51
The estimated, receipts from all sources for the year are $95,800,000 00
Leaving a balance to be provided for of $379,531,245 51

The whole amount to be provided for from loans will be,

For the fiscal year 1862, under existing laws $75,449,675 00
For the fiscal year 1862, under laws to be enacted, about 200,000,00000
For the fiscal year 1863, also under laws to be enacted 379,531,245 51
Making an aggregate of $654,980,920 51

The statement of the Public Debt, on the basis of the foregoing estimates is:

On July 1, 1860, it was $64,769,703 08
On July, 1861, it was 90,867,823 68
On July 1, 1862, it will be 517,372,802 93
On July 1, 1863, it will be 897,372,802 93

— In round numbers, if the war continues till July, 1863, the Public Debt will be $900,000,000, which, the Secretary says, the country can pay in thirty years as easily as it did, in twenty years, the debt of $127,000, which existed in 1816, at the close of the war. — In order to raise the revenues as estimated in the foregoing statements, the Secretary advises that the duties on brown sugars be raised to 2˝ cents per pound; on clayed sugars to 3 cents; on green teas to 20 cents; and on coffee to 5 cents; beyond these he thinks no change should at present be made in the tariff. The direct tax should be so modified as to produce $20,000,000 from the loyal States, the income-tax to produce $10,000,000; and a tax producing $20,000,000 to be imposed upon stills, distilled liquors, tobacco, carriages, bank notes, paper evidences of debt, etc.: making the whole amount of direct taxation $50,000,000. — But the most important suggestion of the Secretary refers to the establishment of a uniform National Currency. There are, he says, in circulation in the loyal States $150,000,000 of bank notes, which is a loan without interest by the people to the banks. This loan may be transferred to the Government, with advantage to the people. Two plans for effecting this have been suggested. The first contemplates the gradual withdrawal from circulation of the notes of private corporations, and the issue in their stead of United States notes, payable in coin on demand. This, which is partially adopted in the issue of the "Demand Notes" of the Treasury, while it offers many advantages, is, in the opinion of the Secretary, liable to inconveniences and hazards. The plan which he recommends contemplates the preparation and delivery to institutions and associations of notes prepared for circulation under national direction; these notes to be redeemed by the institutions to which they may be delivered for issue; this redemption to be secured by the pledge of United States stocks and an adequate provision of specie; the notes to be receivable for all Government dues except customs. These notes would, in the opinion of the Secretary, form the safest currency which this country has ever enjoyed; for they would be of equal and uniform value in every part of the Union. In a year or two the whole circulating medium of the country, whether notes or coin, would bear the national impress, and its amount, being easily ascertainable, would not be likely to be increased beyond the wants of business. This plan, in its essential features, has been tried in New York and one or two other States, and has been found practicable and useful. The probabilities of success would be increased by its adoption under national sanction for the whole country.

Our Record closes on the 11th of December. The proceedings of Congress, though mainly preliminary, are of importance as showing the feelings of the members. Messrs. Breckinridge and Burnett of Kentucky, and Reed of Missouri were expelled on account of their connection with the insurrection. — In the Senate, Mr. Saulsbury, of Delaware, proposed the appointment of a commission consisting of Messrs. Fillmore, Pierce, Everett, Crittenden, Taney, and five others to confer with a similar commission from the so-called Confederate States, with a view to the restoration of peace and the preservation of the Union; and that during the deliberations of the joint commissioners active military operations should cease. This proposition was promptly laid on the table. — In the Senate, Mr. Trumbull of Illinois offered a bill "for confiscating the property and giving freedom to the slaves of rebels." It provides for the absolute forfeiture of all property belonging to persons beyond the jurisdiction of the United States or beyond the reach of the usual civil process who shall take up arms against the United States, or in any way aid the rebellion; the proceeds of the property to be held for the benefit of loyal creditors, and for loyal citizens who shall have been despoiled, and to defray the expenses of the war. The bill also

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forfeits the claims of all rebels, and those who give them aid or comfort, to persons held by them as slaves; declares the slaves thus forfeited to be free, and makes it the duty of the President to provide for the colonization of such as may be willing to go in some tropical country, where they may have the protection of the Government and be secured in all the rights and privileges of freemen. — In the House, Mr. Stevens of Pennsylvania offered a preamble and bill declaring that there can be no permanent peace or Union in the republic so long as slavery exists within it, that slavery is an essential means of protracting the war; that according to the law of nations it is right to liberate the slaves of an enemy to weaken his power; that the President be requested to declare free, and to direct all our generals and officers in command to order freedom to all slaves who shall leave their masters or shall aid in quelling the rebellion, and that the United States pledge the faith of the nation to make full and fair compensation to all loyal citizens who are or shall remain active in supporting the Union for all damage they may sustain by virtue of this resolution.

The Secretary of the Treasury has issued regulations relating to the property found in such parts of the disloyal States as may be occupied by the United States forces. Agents are to be appointed to reside in these places, whose duty shall be to secure and prepare for market cotton and other property. They rnav for this purpose employ slaves, paying a proper compensation for their services. The cotton and other products to be shipped to New York, consigned to an agent appointed for that purpose.

The naval and military expedition, whose sailing was noted in our last Record, has achieved a brilliant success. The fleet, numbering 50 vessels and transports, besides coal vessels, sailed from Hampton Roads on the 29th of October. When the sealed orders were opened it was found that the destination was Port Royal Harbor, near Beaufort, in South Carolina, one of the points which had been supposed to be in contemplation. On the 1st and 2d of November the fleet encountered a storm, the severest of the season, by which it was utterly dispersed; on the morning of the 2d only a single sail was to be seen from the deck of the Wabash, the flag-ship. On the 3d the storm abated, and the vessels began to reappear. The damage proved to have been less than was anticipated. A few of the smaller vessels were forced to put back; one went ashore, and the crew, numbering 73, were made prisoners. The Isaac Smith was obliged to throw overboard her battery. The Peerless and Governor sunk, all those on board being saved with the exception of seven marines on the latter vessel, who were drowned through their own imprudence. Damages, comparatively slight, were sustained by other vessels. On Monday morning, November 4, the fleet, 25 vessels being in company, and many more heaving in sight, anchored off Port Royal bar. The aids to navigation had been removed, but on the next day the fleet crossed the bar. The following day was occupied in making reconnoissances and preparations for the attack. It was found that two strong forts, Walker and Beauregard, had been thrown up on the points commanding the entrance to the harbor. At half past nine on the morning of the 7th the attack was made by 16 selected vessels of the fleet, the military force not being called upon to participate. The enemy evidently supposed their defenses impregnable, and large numbers of the inhabitants, including some from Charleston, came out to witness the engagement. The attacking vessels sailed around in a circle, delivering fire alternately into each fort. Meanwhile a number of small Confederate vessels, commanded by Josiah Tatnall, lately Commodore in the United States Navy, and commanding our East India squadron, appeared, but took no important part in the fight, and were speedily beaten off. The light lasted three hours, at the end of which the batteries were found wholly untenable, and were evacuated, the enemy escaping toward the interior. Our loss in this engagement was only 8 killed and 23 wounded, 17 of them but slightly; none of the vessels suffered serious damage. The loss of the enemy was considerable. Many bodies were found in the forts, and some 30 at a distance of half a mile. We captured the entire armament of the forts, consisting of about 40 cannon of the heaviest calibre and most approved models, besides a large quantity of ammunition and camp equipage. The military force was landed, and every preparation made to hold the port thus acquired. The harbor of Port Royal is the finest on the Southern coast; ships drawing 25 feet enter it with ease, and it is capable of containing our whole fleet. A small party was sent to take possession of Beaufort, some 15 miles distant. The place was found entirely deserted by the white inhabitants, only a part of the slaves remaining.

A naval expedition of scarcely inferior importance sailed from New London on the 20th of November. It consists of 25 vessels, mostly old whalers, heavily loaded with stone, and so arranged that by opening holes in the bottom they can be sunk in a few minutes. The design is to sink them at the entrances of the Southern harbors, thus effectually closing the ports against all egress or entrance.

In Missouri Major-General Halleck has been appointed to the command vacated by the removal of General Fremont. He has issued a series of military orders to the effect that active rebels and spies have forfeited their rights as citizens, and are liable to capital punishment; that all persons in arms against the Government or aiding the enemy shall be arrested and their property seized; that all persons within the national lines giving information to the enemy shall be shot as spies; that unenlisted marauders will not be treated as prisoners of war, but will be considered as criminals; military officers to enforce the law confiscating slave property used for insurrectionary purposes; citizens who have been robbed by insurrectionists to be quartered, fed, and clothed at the expense of insurrectionists; prisoners of war and slaves, in case of necessity, to be employed in the construction of military defenses. — The reports of military operations in this State are vague and contradictory. The most reliable accounts represent that the main body of the enemy have retired to Arkansas, but that the southern portion of the State is overrun with bands of marauders.

From Kentucky intelligence is equally indecisive. A Convention was held at Russellville, October 29, Mr. Burnett, late member of Congress, presiding, "to confer with reference to the steps to be taken to better preserve domestic tranquillity and protect the right of persons and property in Kentucky." The acts of the General Government were condemned; a "Declaration of Independence and Ordinance of Separation" was adopted. A plan of a Provisional Government was also framed, the seat of government to be at Bowling Green. The Provisional Government to consist of a Governor and ten Councilmen, to be elected by the Convention;

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Commissioners to be appointed to treat for the admission of Kentucky into the Southern Confederacy.

In Maryland the recent election resulted in the re-election of Governor Hicks by a very large majority. The Legislature convened on the 4th of December. The Message of the Governor says that the special session was convened that measures might be taken to undo the evils occasioned by the last Legislature. He says the rebellion must be put down at any cost, and Maryland must bear her share.

The direct military operations of the month have not been of special importanes. A sharp affair took place at Belmont, Missouri, on the 7th of November. A body of 2850 men, under Generals Grant and M'Clernand, set out from Cairo to attack a camp at Belmont; the object was attained, the enemy were driven off, and the camp burned. The enemy were then strongly reinforced from Columbus, on the opposite side of the Mississippi, and our troops re-embarked for Cairo. The whole action lasted six hours. The loss on each side, made up from official sources, was:

 Killed.Wounded.Missing.Total
National 84288235607
Confederate261427278966

Messrs. Mason and Slidell, appointed Ministers from the Southern Confederacy to England and France, have failed to reach their destination. The steamer on which they embarked from Charleston, having eluded the blockade, landed them at Cardenas, in Cuba; they went by land to Havana, where they were received with every consideration. Here they awaited the arrival of the British mail steamer Trent, plying between Southampton and the West India Islands. They embarked on the 7th of November, with their families and suites. Meanwhile the United States steam-sloop San Jacinto, Captain Wilkes, was cruising in the Gulf in search of the privateer Sumter. Learning of the embarkation of Messrs. Slidell and Mason, Captain Wilkes started in pursuit of the Trent, and overtook her in about 24 hours after her departure. He demanded the surrender of the Confederate Ministers and their Secretaries, which, after some little demur, was acceded to; and Messrs. Mason and Slidell, with their Secretaries, were taken on board the San Jacinto, their families being allowed to proceed on the voyage. The prisoners were brought to Fortress Monroe, and subsequently sent to Fort Warren, in Boston Harbor. Captain Wilkes, in making these arrests, acted wholly upon his own responsibility; but his action has been fully sanctioned by the Government.

EUROPE.
From Great Britain our intelligence relates almost wholly to commercial affairs, and the main topics of interest are connected with American relations. The Government still maintains its friendly tone, though in commercial circles there appears a growing disposition to favor the Southern side. At the Lord Mayor's dinner, November 9, Lord Palmerston, in response to a speech from our Minister, Mr. Adams, said that though circumstances may for a time threaten to interfere with the supply of cotton, yet the temporary evil would be productive of good to Great Britain, as she would in consequence in time find ample supplies from other quarters, and thus be rendered more independent. — The Confederate steamer Nashville arrived at Southampton on the 21st of November. Two days before she had captured and burned the New York packet ship Harvey Birch; the crew were brought to Southampton and liberated; a portion of them, who refused to pledge themselves not to bear arms against the Confederate States until regularly exchanged or discharged, were put in irons. — In Ireland the potato crop has turned out a total failure, and in consequence a famine is apprehended.

In France the most important circumstance is financial embarrassment of the Government. A bad harvest and stagnation of trade growing out of American difficulties, combined with the enormous expenditures upon the army, navy, and public improvements, have occasioned a serious deficit. The Emperor called in the aid of M. Fould, who pointed out to him that one great source of expenditure was the opening of supplementary credits to the different Ministries, not embraced in the regular estimates. These in 1861 amounted to 200,000,000 francs. The Emperor thereupon invited M. Fould to assume the post of Minister of Finance, and announced his determination to relinquish the power of opening such supplementary credits. Henceforth the Budget will be presented to the Legislative Bodies, who will pass upon it, section by section.

The combined French, English and Spanish expedition to Mexico has set out. The convention between the sovereigns has been published. "Feeling themselves compelled by the arbitrary and vexatious conduct of the authorities of the Republic of Mexico to demand from these authorities more efficacious protection for their subjects, as well as a fulfillment of the obligations contracted toward their Majesties by the Republic of Mexico," they have entered into a convention, the points of which are: That each shall contribute such naval and military force as shall be agreed upon, the "total of which shall be sufficient to seize and occupy the several fortresses and military positions on the Mexican coast;" the commanders are also to execute such other operations as may, on the spot, be found advisable; all measures to be executed in the common name. The parties pledge themselves not to seek any acquisition of territory or any special advantages, nor to interfere with the right of the Mexican nation to choose its own form of Government. A commission of one member of each nation is to determine the application of any money which may be recovered from Mexico. The Government of the United States is to be invited to accede to this convention, but no delay is to be made in awaiting this accession beyond the time necessary for the combined forces to assemble in the harbor of Vera Cruz. From Havana we learn that a portion of the British and French vessels had arrived at that port, and that the first division of the Spanish fleet sailed for Vera Cruz on the 28th of November, to he shortly followed by two other divisions.

The Italian Parliament convened at Turin on the 20th of November. Baron Ricasoli, the Prime Minister, laid before the body the position of the Roman question. Proposals for a reconciliation between the Government and the Papacy had been framed, and the mediation of the Emperor Napoleon had been asked. These proposals contained stipulations that the Pontiff and his Cardinals should retain their dignities and personal inviolability, and should be guaranteed a certain revenue by the King of Italy. The Italian Government was not to interfere in any way with the exercise of the Pope's spiritual functions, the dispatch of Papal Nuncios, the convoking of synods and councils, the nomination of bishops, or the presentation to ecclesiastical benefices. In the event of the rejection of these, proposals, it was intimated that "the Italian Government could not without difficulty, restrain the impatience of the people, who claim Rome as their capital."

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