The Sun. — London, England, 1870-10-31 00:00:00

111, THE PAYMENT OF THE NATIONAL DEBT. (BY THOMAS DE MESCHIN, LL.D.) The Government has lately converted large amounts of the consolidated bank or perpetual annuities into termi nable annuities. Thus, in 1861 the estimated capital of the terminable annuities was under 19 millions ; in 1868 it was nearly 57 millions ; shewing an increase of about 33 millions. If this conversion be wrong in principle, this is a very serious matter ; and that it is wrong, and utterly indefensible, I propose to shew in this article. That part of the National Debt upon which a perpetual annuity is payable is called the redeemable debt, because it may be redeemed by Parliament upon payment of the capital ; thus no matter how high the price of consols may be, Parliament can always pay the holder off by giving him £lOO, but under no circumstances whatever can the stockholder insist on being paid off. To the Government belongs the option. That part of the debt which is invested in annuities for lives, or years, is called the irredeemable debt, for such cannot be redeemed during the term without the co - unlit of the holder. The first attempt to raise money on annuities for lives was in 1692, when it was proposed to raise one million sterling, the contributors getting 10 per cent. for ten years, and afterwards 7 per cent., on the lives of their nominees, with the benefit of survivorship, till the number was reduced to seven. Advantageous as these terms were, the Government could only raise £lOB,lOO. An alterna tive was allowed of an annuity for a single life, at 14 per cent., the sum raised on which was £773,393. Considerable sums in early periods of the debt were raised on annuities for lives, but since the accession of George 111. they have alwayslbeen created as bonuses for the purchasers of new stock. Annuities have been re. peatedly converted into stock by the holders, on terms offered by the Government. The motive that actuated former governments thus to convert terminable annuities into perpetual annuities was not a desire to relieve the Exchequer. It was not that the annual amount paid in respect of perpetual annuities would be smaller than that paid in respect of terminable annuities, but such schemes of conversion—at least when they occurred in time of peace—sprung from a desire, and I may add a resolution, to pay off quickly the whole debt. It also arose, when the conversion was into five per cent, stock, from an expectation—which was subsequently realised— that it & would be ultimately possible to reduce the interest on such stock to four per cent. or to three per cent. The Chancellor of the Exchequer is just doing the converse of this. He is converting perpetual annuities into terminable annuities with precisely the same object, the extinction of the debt. Borrowing on terminable annuities is apparently be coming popular. There is an air of patriotism thrown around it. It makes some pretension to the discharge of present duty, it negatives an utter disregard to the interest of posterity. Yet a very slight consideration will serve to show that annuities are either in time of peace or in time of war, the most expensive, the very worst method of borrowing that could be adopted. There are four modes of borrowing on terminable an nuities :-1. For a term of years. 2. On a single life. 3. On the longest of two or more lives. 4. On tontines. Tontines, so called from an Italian banker, named Tonti, who invented them. The subscribers to a loan raised by way of tontines usually appoint nominees, who are divided into classes according to their ages, and a proportionate annuity is assigned to each class. When any of the nomi nees die, the amount of the annuity disengaged by such death is divided among the survivors of that class to which the deceased annuitant belonged, so long as any nominees remain, or until the annuity payable to each survivor amounts to a fixed sum, usually very large, according to the terms ofthe particular scheme. Tontines appear to be well adapted to the desires of mankind.lMost men entertain hopes of longevity. All desire ease and affluence in old age. Moreover, men have naturally great confidence in their own good fortune. For which reason tontines usually sell for more than they are worth. Tontines have been adopted to a considerable extent in France and other countries, but only on three occasions in England, viz., in the beginning of the reign of William 111., in 1766 and in 1789. Tho terms of the tontine of 1789 were, that the sub scribers of 2100 ss. Od., being distributed into six classes, according to their ages, should receive the undermentioned annuities, with the benefit of survivorship in their re spective classes, till the annuity on the original shares amounted to £l,OOO, after which the surplus fell to the Government. Ist Class, under 20 years of age £4 3 0 2nd Class, from 20 to 30 3rd Class, from 30 to 40 4th Class, from 40 to 50 sth Class, from 56 to 60 6th Class, above 60 Thus, if the first class consisted of 10,000 individuals who had each paid over a sum of £lOO ss, to the Govern ment ; when the number was reduced to 5,000 each survivor received £8 6s. a-year ; when reduced to 2,500 each received £l6 12s. When the number of survivors was reduced to 42, each got £l,OOO a-year for the rest of his life, or £l,OOO a-year for every ,ClOO ss. Od. that he had subscribed. If the Government are determined to grant annui ties for lives there does not seem to be any reason why they should not try tontines. In 1773, 1775, and 1776 they were tried in Ireland ; one reason why tontines have never succeeded very well in England is, that when Government wants money it always goes, not directly to the people, but invariably to the grert bankers or money-lenders, who. in advancing money to the Government, do not intend to invest their own capital in the loan, but merely intend to sell with a profit their share in the subscription to the loan. This system has the advantage of " cockering up the Bank of England" in particular, and the bankers in general. But, then, the loss entailed on the country is measured exactly by the profits secured by the go-between bankers. If the Government went directly to the people, as the French Government does, and tapped the spring at the fountain head, it would always procure the money that it wanted on easier terms. Another evil resulting from the system is that it has been thought necessary " to cocker up," and to confer a monopoly on the stockbroking interest. Why should we not has e free trade in stocks and shares ? Why should not everyone have a right to deal in stocks ? Why should I not be able to sell my stock, as I sell my corn, to anyone? I believe in Germany, France, and Italy, any. one can deal in stocks and shares. Perhaps I may remark that the substance of this article was read as a paper at the British Association, at Liver pool, on the 15th September last, and that in the lengthened and animated discussion that ensued upon the reading of that paper there was an overwhelming weight of opinion and authority in favour of the views here stated. Per. haps I may also mention that as Mr. Lambert was aware of my strong and decided opinion respecting the conver version of stock into terminable annuities, he requested me to state my objections and send them to him, which I did in a memorandum which contained the substance of this article. We will, first, investigate the effect of borrowing in ter minable annuities during war, and afterwards the effect of converting stock into terminable annuities in time of peace. First. In borrowing in terminable annuities : The ratio that the annuity bears to the sum advanced to the Government is always determined by the rate of interest current in the money market at the time of effecting the loan. It is notorious that the rate of interest during war is always higher than during peace, at least when the Government is in the market as a borrower. Now, as those annuities so borrowed at a high rate of interest are irredeemable, the country derives no advantage from the fall in the rate of interest, which ever accompanies the re turn of peace. In point of fact, upon the return of peace these annuities generally sell for a higher price than the sum originally advanced, although part of the term for they were grantedhas elapsed. This was heavily felt in the reign of George 1., when a large proportion of the debt was advanced on these annuities, and upon a general re duction of the rate of interest on the other portions of the debt. In order to effect the conversion of t erm i na bl e annuities into perpetual annuities (a crochet of that day just as the converse, viz., conversion of p erpetual annui ties is a crochet of this day). It became ne cessary to give a capital stock in perpetual annuities one-fifth larger than the sum originally received by the Government for the grant of such terminable annuities. Thus all the pay ments that had been made previous to the conversion, were made in pure unmitigated loss. Had a loan been effected exclusively on terminable annuities during the late French war, this would, on the return of peace, have been palpably apparent, but latterly terminable annuities have only been granted as bonuses to lenders. Dr. Hamilton thus describes the matter :—" The long annuities (created during the previous war) in consequence of the reduction of interest (caused by the peace) now sold at a higher price than the sum originally advanced, notwithstandin g the part of the term elapsed. These annuities had been granted at different rates, most of them about 16 years purchase. The South Sea Company, by purchasing £lOO annuity, f or which £ 1,600 had been originally paid, became entitled to a capit a l o f 22' 000 . i Thus the public, nstead.of an annuity which terminated by the course of time without repayment, became bur dened at present with an equal One, which could only be extitaguished by the payment of a sum greater by one fourth than what had been advanced (the permanent debt created exceeded the sum originally advanced by 23,034,769). But in return for this the debt was ren dered redeemable, and a reduction of interest to four per cent. in 1727 was agreed on ; and in consequence of the option of redemption Government was enabled afterwards to reduce the interest to three per cent., along with that of the other debts. These measures have been much com mended, but their advantage seems equivocal." [p. 81.] Second. This method of borrowing (during war) in creases the amount of debt, which it is necessary to incur. Supposing the amount of taxes laid on during war to have no reference whatever to the method'of borrowing adopted but to be regulated exclusively by the amount of taxation the country was able to bear. In this case the amount of the loan each year will be measured by tho excess of ex penditure over income. Now, for equal amounts, bor rowed on perpetual annuities, and on terminable annuities, the annual payments in respect of terminable annuities, it is obvious, will be much the larger. That is, the gross annual expenditure of the country will be larger by borrowing on terminable annuities, and, of necessity, this larger expenditure will necessitate alarger loan. But the next year the amount of the loan will be augmented from two causes —first, by the in creased annual charge, as in the former year, due borrowing on terminable annuities, and second, it will be augmented by the annual charge on that portion of the loan of the former year, which constituted the increment due to borrowing on terminable annuities over that which would have been incurred by borrowing 'on perpetual annuities. If any one will take the trouble to consider, they must see to what a large extent the capital of the debt would be increased in a few years of war should this method be adopted. And, moreover, all this would be incurred at the high rate of interest which is usually current during war. In the second place we will state the ground upon which it is undesirable to convert perpetual annuities or consols into terminable annuities during peace. First. It is in the highest degree impolitic ; sound policy requires that the debt should ,be paid . off during peace, that is by causing revenue to exceed income. The excess of revenue above expenditure is the only means by which the public debt can be discharged. The increase of revenue and the diminution of expense is the only mode by which the liquidation of the debt can be accelerated. During war, expenditure invariably rises above income, and it is an axiom in finance, that at such periods all pay ment of debt ought to be suspended. In 1792 Mr. Pitt established his second sinking fund of one per cent. on the nominal capital of each loan to which the dividends on the capital redeemed by this fund were to be added. This fund was ap pointed to be kept separate, and applied for the redemption of all debts contracted subsequent to its institution, by which means it was esti mated that every loan would be redeemed in forty five years at the furthest, from its contraction. If such a sinking-fund of one per cent on the capital of each loan be annexed to, and bound up with an annually aug menting debt in the event of the loans being obtained on the same terms as the debts are redeemed, and the oper ations which it involves conducted without expenses, it is obvious that such a sinking-fund has ultimately no effect either in increasing or diminishing the amount of the debt But in every loan the contractors have a profit, the re sult is that the nation sustains a loss equal to the bonus given in respect of the additional capital, which the oper ation of the sinking-fund renders it necessary to fund ; and the cost incidental to the management of the sinking-fund, and of the increased capital of the debt. Dr. Hamilton cal culates that the loss accruing to the nation from the operation of these causes from 1793 to 1817, amounted to about £30,000,000.—[p. 199.1 This seems a good round sum to pay for one's whistle. The annual dividend payable in respect of Consols or Stock represents the bare interest on the capital sum, but the annual amount paid in respect of a terminable annuity represents not only the interest but also a portion of the capital; the payment of the capital is in fact spread over a given number of years. The amount of capital paid off each year will vary with the length of the term for which the annuity has been granted ; if the term be short the amount of capital annually paid will be large. When the Government converts a portion of the debt into terminable annuities the annual charge upon the revenue is augmented, in place of having to pay the in terest as upon Consols, the nation has annually to pay the interest and part of the capital. In short, conversion means this—an undertaking to payi off certain specific portions of the debt every year. Therefore, by converting Stock into terminable an nuities, the Government is saddling the nation with the obligation to pay large amounts of capital every year, and this obligation will subsist in war as well as in peace. If we should get involved in a long war, what was true of Mr. Pitt's sinking fund of 1 per cent. added on to each loan, will also be true of that obligation to pay large amounts of capital annually with which the improvidence of the Government is saddling us. The expenses of war are now so enormous and gigantic that it is exceedingly probable that we shall be compelled to raise a considerable portion of war revenue by means of loans. If so we should be borrowing with one hand and paying off our debt with the other, but while we might be com pelled to borrow at five or six per cent, or even at a higher rate, we should be paying off portions of the debt which we held at 3or 3 per cent. What should wo think of a private mortgagor who borrowed money at,s or six per cent, to pay off a mortgage at 3 per cent., yet this is what the wisdom of the Government is probably accomplishing for this country. It is therefore to the last degree impolitic to saddle the country with the obligation to, pay these annuities. All payment of the debt ought to be suspended during war, but deliberately to incur the obligation to pay off money held at a low rate of interest, with money obtained at a high rate of interest, seems the summit of finan cial folly, and yet this is precisely what the present Government is doing. Second. During war lam in favour of raising, if possible, the'whole supplies within the year (for loans for the most part are really taxes upon wages raised within the year). Well, then, to saddle the nation with the necessity of pay. ing during war large amounts of the capital of the Debt is deliberately throwing the utmost difficulties in the way of raising the supplies during war within the year. This is clearly a working man's question. If the working men of England allow the Government thus to take steps that must result in placing upon their shoulders the financial weight of any struggle in which the nation may hereafter engage, they do themselves and their children a great wrong, and this, too, without any real benefit to anyone. For if these annual amounts of capital, the payment of which are wrapped up in the terminable annuities, were applied directly to the liquidation of the Debt, the result would be a reduction of the Debt, at least as large, and I firmly believe, larger. Thus, to single out the interests of the working class for the purpose of inflicting on them a great and gratuitous loss does not seem to be very wise or grateful in a Govern. ment that owes so much to the goodwill of that class. Third. The next objection is that itis unconstitutional. It deprives future Parliaments of theirlegitimate control over portions of the revenue, compelling them to vote supplies for the annual payment of such portions of the capital of the Debt as are comprised in the annuities, whether they will or no, although at the moment it may be impolitic or inconvenient to votesuch supplies. To tie up the hands of future Parliaments in this manner, for the bare sake of doing so, as is the sole object of much of the late con version of stock into annuities, is a most gross and unpar donable violation of the constitution. The House of Com mons ought to be swift to mark and slow to forgive any violation of the Constitution. Such wise jealousy is and has always been one of the great mainstays of its power, as it is the surest guarantee of the permanence and stability of its existence to all generations. Anxious as I am to see the Debt paid off, I am far more anxious to see her Majesty's Government pay the most scrupulous regard to the Constitution— a regard that will be just as necessary and just as salutary in demo cratic as in despotic times. Indeed, I for one have ob served with profound alarm that this, the first Govern ment after a sweeping Reform Bill, does not hesitate to act in an unconstitutional manner in small things upon very slight temptation. This is a tendency that should be vigilantly watched, and uncompromisingly'opposed. If a Government allows itself to violate the Constitution in small things, as the descent to Avernus is easy, it will soon come to attempt its violation in greater things. Fourth. It is by far the most expensive mode of paying off the Debt. A terminable annuity is constantly diminishingin value. No one cares to buy it. It can rarely be made the subject of settlement, and the great bulk and body of Government stock is purchased and held for settlement. When, therefore, the Government forces these annuities upon the market, it must do so at a heavy loss. Adam Smith says:—" The real value of an annuity begins to diminish from the moment it is granted, and continues to do so more and more as long as it subsists. It can never, therefore, make so convenient a transferable stock as a perpetual annuity, of which the real value may be "supposed always the same, or very nearly the same."—[" Wealth of Nations," B. v., ch. 3.]. Fifth. The direct application of surplus revenue is the THE SUN, LONDON, MONDAV OC POBER 31, 1870. cheapest mode of reducing the debt. The same annual amoun t applied directly to the reduction of the debt will effect a larger diminution than when applied by the roundabout way of conversion into annuities. Upon the termination of an annuity it will be found that a greater financial effort has had to be undergone than would have sufficed to pay off by direct payments the original debt converted. Moreover, if a sensible reduction of the debt were effected every year, the value of consols would quickly equal and ultimately surpass that of par, in which case the interest of the whole debt may be reduced. Sixth. There is a serious objection to granting annuities for lines for it constantly leads to all sorts of frauds on the Government—annuities being often drawn after the life has died out. In tontines the Government has this ad vantage that each individual in the class has an interest in discovering the death of every other individual in !his own class. Seventh. Both M. Jean Baptiste Say and Mr. M`Culloch brand terminable annuities as immoral. Say says :—" Les rentes viageres et les tontines sant des emprunts tres-on&eux pour I'emprunteur, qui paie jusqu' h lafin le memo intdrot, quoiqu'il se libere chaque amide d'une portion du principal; elles sont, de plus, immorales ; c'est le placement des 6goistes, elks flattent et favorisent la dissipation dos capitaux, en fournissant au preteur un moyen de manger ses fonds avec son revenu, sans risquer de mourir de faim." [D'Econ. Pol. liv. iii., ch. 9.] Mr. M`Culloch observes, "No Government ought ever to countenance any scheme of finance that has a tendency to weaken the providence and forethought of its subjects ; but such," he very much apprehends," would be the effect of the adoption of any scheme of funding on terminable annuities, whether for a certain specified number of years or for lives." Eighth. It is cheating the country into doing its duty. It is assumed that the English people are indisposed to pay the debt, that they have not the honesty or resolution to keep an adequate annual surplus, and steadily apply it to the reduction of the debt. It is, therefore, necessary to treat them as children, and to compel them, whether they will or no, to pay it in the shape of annuities. I am convinced that this assumption is as unfounded as it is insulting to the people of England. The Government is, therefore, on the horns of this dilemma. If it believes that the people of England are in favour of paying off the debt, it was bound to apply the late surplus for that purpose ; on the other hand, if it believes that the people are opposed to au annual application of a portion of the taxes to the reduction of the debt, to attempt to pay it by annuities, or by any other financial sleight of hand, is clearly unconstitutional. Ninth. The moral effect of maintaining an adequate sur plus revenue for the liquidation of the debt is very great ; it is a clear and unequivocal acknowledgment of our obliga tion to discharge the debt—an obligation that was repeated again and again by Mr. Pitt, and almost every other Minister when the money was borrowed. It is a moral discipline of self-sacrifice of the highest value in a national point of view. In paying off the debt in the shape of a terminable annuity, we pay the debt because we must. In maintaining a surplus revenue, we pay it because we ought ; it is a sacrifice of our ease at the altar of duty ; and it is the duty of Ministers and of Parliament to evoke and foster a public opinion that will compel every Chancellor of the Exchequer to provide an adequate annual surplus for the speedy discharge of the debt. (To be continued.) POLITICAL MANCEUVIIES UNDER THE EMPIRE. The secret papers found in the Imperial Cabinet, and now pitilessly exhibited to the light of day, include a quantity of correspondence which passed between the principal politicians of the Empire during the formation of th e 011ivier Ministry. A selection of these has just been published, in which the redoubtable Emile shews himself under various aspects. In the first letter he writes to M. Duvernois on the 10th November, saying that after much deliberation he ogees with Duvernois and Magne that the Ministry should be reorganised before the session, immediately after the Paris election. He is more than ever convinced that it is impossible he should enter on a course of repression towards the press. He, a Libe ral, cannot prosecute when the reactionists did not prose cute. " I have," he says, " written to the Emperor in this sense. You are warned to act accordingly, and announce me in the Peuple in a way which shall efface the impres sion made by your former articles. Your watchword, if you come to the office of the Interior, must be liberty, and not reaction. Take care of this, and work boldly and with outllelay for this end." In a postscript to this letter he speaks of having received a letter from the Emperor so noble and so confiding that it has overcome all his scruples. He therefore suppresses the letter he had written, and sends another which he encloses for Duvernois to read, and for ward either open or closed, as he may think advisable. He recommends him to insist on Forcade (the famous reactionary statesman, who was the ruling spirit of the preceding Ministry) being in the Council of State. By this means Forcade will not be humiliated, and the public satisfaction at seeing him removed from the Interior will conduce greatly to a successful result. In the letter to the Emperor, which 011ivier encloses, he says he is convinced that as the Senatus Consultum was a transformation of things, so his own advent to power must be a transformation of persons. He thinks it indis pensable that the Empire should attract the greatest pos sible number of young men of talent, between 30 and 40 years of age, who have not identified themselves with the revolutionary party. He therefore proposes the nomina tion of Duvernois as Under-Secretary of State for the Interior, and Philis as Secretary of Justice. The latter is an advocate, a friend and companion of Gambetta and Ferry, whom he left to remain faithful to 011ivier. His influence among the young Irreconcile ables would be beneficial. These appointments would have the additional advantage of establishing the precedent that under secretaries of state need not necessarily be selected from the Deputies. In concluding his letter, he urges on the Emperor the necessity of calling the youth of the State round him as the only means of saving his son. A regeneration of per.. sonnet is imperative, " else you will," he says, "perish of inanition in the midst of the pusillanimous and incapable cohort of functionaries." He wishes to select the good men from all parties, but the Liberals have so long been resolutely excluded that there are long arrears to make up in their respect. In another letter to the Emperor, eight days later, 011ivier asks permission to offer the Portfolio of Com merce to M. Buffet. He knows all the draw backs to such a proposal, but Buffet is no Protectionist ; he speaks well and has great influence. 011ivier undertakes to guard his Majesty against ses inconvenients. If, however, the Emperor cannot make up his mind to M. Buffet, will he have Segris? 011ivier would prefer to have colleagues personally agreeable to his Majesty, but the task before them is a difficult one, and they can only get through it by mutual forbearance. He suggests various other appointments proposing to give Pietri a place at the Interior, no doubt as a bonne bouche for his Imperial master after the un welcome suggestions of the Left. A note from M. Duvernois to Pietri at Compiegne is marked private and urgent, and announces that 011ivier will start that evening for Compiegne having his head enveloped in a handkerchief and leaving off his spectacles, so as not to be recognised. A note from Conti to Duvernois, informs the latter, that the Emperor on hearing his position in regard to the accounts of the Peuple Francais, directs him to keep the money he has had in advance as a remuneration for his services in that journal. Other letters from Conti to Duvernois express the greatest delight that 011ivier has extricated them from the difficulties of the position. Last in the list comes a note from 011iiier to Duvernois, beginning "My dear friend," and declaring that both he and the Emperor are anxious to have his assistance, and then, proceeding to explain that they cannot, because they must keep M. Magne for fear the Bourse should be affected. Having thus evaded all his promises at the out set, M. Emile 011ivier hopes his dear friend may never have the annoyance of forming a Cabinet. A lady has left Mrs. Gladstone £l,OOO for her orphanage at Woodford. THE LATE MURDER IN IRELAND.—Slattery, the farmer who is alleged to have so brutally murdered his wife, in a fit of jealousy, near Birdhill, in the county Tip perary, a few days ago, has been captured. He hid him self in a dense wood after the perpetration of the crime, but the constabulary surrounded it, and employing a large number of country people as " beaters," he was driven out and secured. An inquest was held on Wednesday, and he was committed for trial, a verdict of " Wilful Mur der" having been returned against him. He is a fine looking young man, in comfortable circumstances: A BOON FOR LADIES.—Highly as sewing machines are prized, there is one great fault to which they are addicted—they make a great noise while doing the work ; a noise so great that for a worker herself to talk at the same time is out of the ques tion. We need not say how trying this must be to a lady. To be not only prevented from talking, but also from listening to the gossip of those around her—the very thought of such a thing is unendurable. Well, an inventor has come to their rescue with a SILENT SEWING MACHINE ; and as it comprises all the appliances and devicesfor varied work with which all the best sewing machines are provided, and several in addition, and exercises them all sO NOISELESSLY that the ladies may gossip even in whispers, and the infant or invalid sleep on in peace, we expect that most of the old machines will ere long be heard, or , heard of, no more, and that "LA SILENCIEUSE," the Silent Sewingß A E l G a E chin -s e rnF,E (at Messrs. POLLACK, SCHMIDT , an d Co. ' s 210 A, NT T, LONDON, W.), will quietly take their place, as the universal domestic helper.—"lnvestment Circular and Financial Record;" September 7, 1870. -7 7 -7 - , L THE CAPITULATION OF METZ. Food difficulties began to suddenly engage the attention of the French commanders inside Metz for many days before the actual surrender took place. A great army was not likely to surrender without undergoing some hardships. Up to the last fortnight of the defence each man was allowed half a pound of bread a day, but within that period the quantity was halved, and there was difficulty in procuring even that morsel. To each peloton of hoops a live horse was allotted per day, but the horses were as badly off as the men. Forage was•extremely scarce, every patch of grass around the fortress being eaten up. Hence the brutes who formed the animal foodof thegarrison were little better than skin and bone. Some that wandered outside the French lines were in a deplorable state— fit only for dissecting. Latterly an epidemic, the result of starvation had set in amongst them. Yet these animals were the staple food of the troops. The Guards still continued to receive a few " extras," and this circumstance so excited the jealousy of the line-men that between the two branches of the service there existed a bitter hostility. In fact the Guards were used by reason of their superior disci pline and contentment, to keep order amongst the rest. It was little to be wondered at that under the circumstances the number of sick should greatly increase, amounting in some cases to as many as one-fourth of a battalion. Bazaine attempted to work off his army in detail by sending considerable parties as deserters. But the Germans frustrated this design. They accepted parties of two or three, but more numerous bodies were sent back. Asc rtie was expected on the last few days, but it did not take place, and in fact became physically impossible. It rained incessantly before the sur render, and the whole country became a perfect quag mire. LETTER FROM THE COMMANDANT. The reply which General Coffinieres, commandant of the fortress of Metz, made to the municipal council of the town on the 15th of the month, foretold the probable capitulation of the town :—" Monsieur le Maire,—The Municipal Council of Metz has honoured me with a letter which expresses most patriotic sentiments. lam not surprised at it, for I have never doubted the active co operation of the population of Metz with the troops called upon to defend our fortress. You may depend upon it that we are also resolved to fulfil our duty, and will do all that is possible. But I would wish you to impress upon the inhabitants that to arrive at the desired end we must remain in unison, and avoid the appearance of want of discipline. There exists, at present, a Government in France which has taken the title of Government for the National Defence. We must recognise this Government in awaiting the resolutions which may be taken by the Constitutional Parilament. You inform me that the inhabitants were greatly distressed to learn that our resources of supplies were very restricted. It was, however, certain that little could remain when Metz had been called upon to furnish during two months the means of subsistence for a civil and military population of more than 230,000 persons. For my part I have never made a mystery of the situation. The reduction of the army's rations, the restrictive measures adopted in the town, and the conversations, I have held with you, Monsieur le Maire, have shewn in an unmistakeable manner the gradual exhaustion of our food supplies. It would be idle to indulge in recriminations about the past, and the accusations of this or that person. Let us rather look with courage at our position, such as it is, and submit with energy to the consequences, with the firm resolve to make the best we can of it." THE LAST DAYS OF THE DEFENCE. Writing previous to the capitulation, the special cor respondent of the Telegraph, in his letter from Head quarters first army, dated October 24th, says : Some very curious things are, and have been lately, taking place here. First of all, as I believe I have already mentioned the outposts, for the last four or five days, have not ex changed a shot. The outworks of Quevlen, St. Quentin, and St. Julien have also remained perfectly quiet ; and, with the exception of a few shots from Plappeville yester day afternoon, nothing has been going on either offen sive or defensive. But if military operations have for the moment been at a standstill, diplomacy has not been idle. On the 17th of this month Bazaine's aide-de-camp, General Boyer, came to head-quarters ; on the 18th he went to King William before Paris, and thence to Wilhelmshohe ; on the 22nd he returned here, and went into Metz ; and yesterday, the 23rd, he came out again, and has gone on to Paris once again. From his statement it appears that General Bazaine is perfectly willing to surrender his army, but that the commandant of Metz, General Coffiniere, will not consent to give up the fortress. His Royal Highness Prince Frederick Charles very naturally objects to take charge of 80,000 or 90,000 soldiers, still hampered with the condition of having the same battle to fight for Metz. His answer is simple, " Metz, or nothing at all." It is easy to perceive that 90,000 men must be fed, and that, so long as they occupy a position round Metz, that city must supply them with food. This naturally reduces the amount of provisions, and helps to effect much sooner the reduction of the fortress. At the same time I cannot help thinking that Bazaine's desire to surrender his army as prisoners of war is a mere subterfuge to gain time, in order that the negotiations now pending between the head quarters of the King of Prussia, and the French re presentatives may come to some definite climax. To obtain this end, no doubt he and General Coffiniere have put their heads together, and Marshal Bazaine thinks that by an apparent willingness to surrender, knowing that his terms could not be accepted, he may gain time, and give his people rest, especially during this fearful weather. In this, to a certain exteut, he has succeeded, for we have had no fighting for five days ; on the contrary, the utmost cordiality has existed be tween the outposts. They have talked to one another, the officers have bowed, the men taken off their caps, and made signs of friendship ; in fact, the same sort of things exists as existed across the Tchernaya during the armistice; but all this is now at an end. Bazaine this evening has signified that diplomatic arrange ments are closed, and that he must have time to de liberate. Count von Bismarck has said that he can listen to no more overtures, and his Royal Highness the Prince has given orders for the army to be under arms at 7 o'clock to-morrow morning. Mean time, the rain falls in torrents, the roads are knee-deep in mud, and the men are suffering fearfully on both sides. To-day some eighty more deserters were received, some from the Garde Imperiale—the whole of which is still in Metz. They tell you the same story—nothing to eat ; yet they live on, and I must say the prisoners look anything but starved. The 24th ' has, however, gone by, and Metz is still La Pucelle; but Ido not see how she can remain so. The fact is, Germany was not prepared for the curious manoeuvre which France has employed for protecting her self. She defends herself in her fortresses. At this pre sent moment Phalsburg, Bitsch, Verdun, Thionville, Lyons, Metz, and Paris are all in a state of siege. Metz and Paris require a large army to blockade and to besiege, and, although the Germans have more than 800,000 soldiers in the field, the peculiar posture of the enemy compels her to utilise every man of them. Under these circumstances it is not surprising that many of these fortresses hold out—with the exception of Stras burg, Toul, and Sedan, not one of them, you know, has capitulated ; and the three that have surrendered are the only ones that have been bombarded. No doubt the German army has taken every available gun to Paris, for there is a lamentable want of heavy artillery else where. A GERMAN VIEW OF THE SURRENDER. The Berlin correspondent of the Frankfort Gazette, who has spent some time before Metz, says that Berlin has found out that the seizure of Paris and the capitulation of Metz take a long time. The German troops have become impatient, because they took a superficial view of things, and imagined when the Emperor was made prisoner that the end of the war was at hand. This extravagant idea has given place to the conviction that the end of the war is far off. Bismarck may yet find out that the possession of Metz and its environs may be most inconvenient. Our soldiers of the army of investment do not seem to fancy these new German brothers, and only ask to be freed as soon as possible from all contact with so hostile a population, and to return to the true Germany. Not the least interesting circumstance in the surrender is the fact that the veteran General Changarnier is among the captive officers. Carried towards Metz on an irresistable and a thoroughly honourable afflatus of patriotic enthusiasm, he reached the wreck of the Second Empire only in time to be driven, high and dry, on the same shoals; and perhaps his fate as the victim of a man whom he detested, and the volunteer of a system which he condemned, is the saddest that strikes us in the present sudden down rush of careers and characters. But on a man like Changarnier, hardened to the strokes' of fate, and accustomed to more cruel destinies than any his captors can by any possibility force upon him, such a doom as mere captivity falls but lightly, The utter prostration of his country must have been enough to break the old man's heart, which the total overthro w of the Empire might have almost gladdened. In any case, there is the white-headed chief among the rest—a bright exemplar, let us be certain, even to that last inter view in the Chateau of Frascati, of what a soldier and a gentleman should be, under more trying circum stances than any that have fallen to the lot of French men for at least two generations. The figure named to day-173,000 —may have called to the minds of observers of events in the earlier campaign the question : With how many men did the French enter on the War ! Let us try backwards a little. We have been assured sometimes that France was caught unprepared for the struggle. We have been told that her cadres were not full, that her corps were " not to the fore "—that, in a , word, she was not ready for the great duel which she } provoked. What is the fact ? Instead of having, as she pretended when her disasters began, no more than 250,000 men were ready to do battle with Germany, she must have had at least 400,000. The figures are perfectly clear. The earlier battles of the campaign gave 10,000 prisoners and 15,000 hors de combat. Vionville and Gravelotte were too obstinate to yield many prisoners ; still 3,000 or 4,000 were taken, and at least 20,000 fell in those two fearful days. The debris of MacMahon's and De Failly's corps at Chalons—the last barely touched by war must have amounted to at least 50,000 men. They were joined by reinforcements numbering not fewer than 100,000 men. Of these about 125,000 were taken prisoners at Sedan, or in the battles which preceded that fearful day of humiliation; and the only regular troops then left to France in face of the enemy were Viuoy's ; which, by adopting Prussian tactis, cleverly fought their way back from 1116zibres to Paris—delivered out of the jaws of the lion. Throwing out Vinoy's Corps, however, and reckoning in the troops that got across the border to Belgium, we have 14,000 men who were killed or taken, besides those left to be captured in Metz. If the Lorraine fortress has really given in with 173,000, the grand total of losses to the French in the three months' war, apart altogether from any local and accidental losses, has been exactly , 337,000. We have only to add to this figure the num ber of regulars at this moment under Trochu at Paris, or under Aurelles de Pala,dines, on the Loire—counting the first; as regular troops, about 50,000, and the second about 25,000 —to bring the total up to 410,000. A reasonable althwance for the " thawing " of an army, so to speak, under the hot influences of hostile presence— and for the dispersion of the regular troops in Algiers, or in cities like Marseilles, Lyons, and Bordeaux, which wanted just about as much keeping down—would entitle us to bring up to at least 500,000 the number of trained soldiers with whom France • entered on the pre sent war. If she has been taken unprepared, it has been simply because her peculiar scale and system of prepared ness fell below that of her stern a.ud cunning enemy. In war, all is matter of comparison: the half-million of men whom Germany now either feeds as prisoners of war, or con fronts as demoralised and incompetent railltaires, had the force of thrice the number more, had they been hurled straight at the enemy's positions, or lines of de fence, instead of lingering about the borders until they had opened their lines to the irresistible wedges of the German attack, so carefully, so promptly, so fatally driven home. — Telegraph. It appears that for some time before the surrender the stock of bread and brandy had been consumed, the only provisions left being horseflesh and wine. Scurvy— from the want' of salt 7 -raged, and there was a want of doctors and every requisite for the hospital. The French state that in all the sorties they have in flicted a greater loss than they have suffered, but that in tho last affair the men were so weak from want of food that it was difficult to get them to advance. On seeing matters had arrived at this stage Marshal. Bazaine held a council of war. It was there debated whether a desperate attempt should be made to break through the enemy's lines. It was admitted that this could be done with fair hopes of success, but with a certain loss of 25,000 men, who would have to be ahandoned to their fate where they fell. It was, however, argued that if the army, after marching several miles exposed for the greater part of the time to the fire of the enemy's artillery, they would be compelled to carry three successive lines of entrenchments, and would be helpless even if they suc ceeded. They had plenty of artillery, but had eaten most of the artillery and cavalry horses, so that on the infan try all the work would be cast. These latter had 130 rounds per rifle, but would reach the other side of the enemy's line in a starving condition and literally without a morsel of food, save perhaps horseflesh. In this state it would be an easy matter for the Prussians to follow them up with the three arms, and in the course of a few hours kill or capture the whole of them. In fact, as we have often asserted in the Diary of the War, Bazaine, if he did cut his way through, could do nothing unless his sortie were made at the same time as an attack by a relieving army. In short, unless Prince Frederick Charles were first crippled Bazaine could not, even if he broke through the investing cordon, reach any spot twenty miles beyond it. We fully believe that if at the commencement of the siege, when his artillery and cavalry were still horsed, and before the Prussions had entrenched themselves, Bazaine had thrown his whole army on one spot, making use of his command of the bridge to deceive the enemy, he would have got clear away. Instead of this he at first remained quiescent, and when he did make sorties he made them with detachments instead of masses. It is possible that, relying on the arrival of MacMahon, he thought he could not do better than merely detain 200,000 Prussians before the place, but as soon as MacMahon's defeat was known to him he ought to have made a supreme effort. When he began to consume his horses it was of course too late to make any but partial sorties. We are assured that it was simply starvation which caused the capitulation, and that there was no political intrigue whatever. It cannot be denied that Marshal Bazaine has, by his prolonged resistance, rendered great services to France, and has probably prevented Paris from being entered the week after the capitulation of Sedan. For upwards I lef two months has the Marshal kept some 200,000 Prussians before Metz, and if the new armies of France should effect anything they will owe their success to Bazaine, for had he capitulated earlier the new armies would have been strangled at the birth. The Prussians have not been slow to profit by their victory. As soon as the capitulation was certain, but before it had actually taken place, the 2nd Corps was despatched to Paris. What will be done with the rest of Prince Frederick Charles's army ? We estimate the whole of it at 150,000 men. Of these some 10,000 men will be required to escort the prisoners, and about the same number to garrison Metz and maintain the communications. About 20,000 men have been sent to Paris. About 100,000 men will, therefore, remain disposable. We imagine that a strong force—say 50,000 men—will be dispatched to capture Verdun, Mezieres, Thionville, Montmedy, &c., and to contain General Bourbaki. The remainder will probably advance towards the Loire, stretching out a hand on one flank to Von der Tann, on the other to the army moving on the Rhone.—Standard. THE- SIEGE OF PARIS. REPORTED STREET FIGHTINQ. It was reported at German headquarters before Paris that street fighting took place inside the capital on the 20th, and that the sortie of the next day was adopted to occupy the minds of the Parisians. But we have heard such stories before, and they have invariably proved un founded. The correspondent of the Cologne Gazette, how ever, gives some details respecting this affair. It will be seen that the information does not come to much :—" This information was spread by the troops which are under the command of the Crown Prince of Saxony, and whose outposts eagerly watch and reconnoitre the forts situated close to the two revolutionary quarters of the town par excellence, the suburbs of Belleville and La Villette. They heard and saw the cannon fired from these forts, but were unable to remark that this can nonade was directed against any spot along the whole of our lines. At the same time, we are informed that on the same day a demonstration had been made in Paris against General Troche. The chiefs of the Red Repub licans had brought the accusation against him that the measures that he was taking against the Prussians were not sufficiently energetic, and they therefore called upon him to venture a sortie en masse against the beleaguer ing army, who would in all probability be unabel to withstand the enormous advance of 300,000 men. The general thereupon replied by an auto graph letter, the text of which unfortunately I have been unable to obtain, but the contents were to the purport that he could not venture, with the organisation and armament of the troops he had at his disposal, to measure strength with so well disciplined an army as the German troops. This letter was received with strong marks of disfavour and disapprobation. However, it appears that General Trochu made up his mind at all risks to convince his restless antagonists, who ardently desired a rencontre with the enemy, of the wisdom of his policy. Thus may be explained the sortie of the 21st October." THE SORTIE FROM MONT VALERIEN. The special correspondent of the Standard, writing from Tours on the 26th, says :—We have received also the German accounts of the sortie from Mont Valerien, with which we are perfectly satisfied. The sortie, to begin with, was only made, according to the account of the King, by. twelve battalions, and could, therefore, have only had for its intention to take some position held by the Prussians, and not to engage the whole force their army. The.mere fact that the combat lasted for three hours shews that they were not easily rep ulse d The most important item of the King's telegram, 311 which appears conclusive as to the success of the attempts' is this sentence : All the town of Versailles Ws: alarmed. All the town of Versailles would u s ti have been alarmed unless the sortie had proc eede a very considerable distance. In the last Pl ace i the official telegram speaks of one hundred prisoners, 11 , fl i i two cannon taken. It would have been singular en ough if at least 100 wounded men and two cannon, prob able of the main body, which extend,d over a large extent °f ground. The Gazette de France published a notice 4 previous to the receipt of the German official news' ": follows :—" We learn at the present moment that 3 81 1 cessful sortie took place last Saturday in the direction of Bougival, under the protection of the guns of l‘ f°n d Valerien. The enemy was dislodged from Bougival su if driven back on Versailles, where he established hini s , s. „ behind barricades thrown up. So sharp was the sell . '" that the troops of St. Germain were called up in all ha s j ",, e to the assistance of those of Versailles." The Gazette `; France does not give its authority for its news, but 0 1 arrived prior to the German telegrams, and is in no W 3 c contradicted by them, it gives in all probability the ret truth concerning the engagement. For the official account we shall have to wait for the arrival of the next balloc ° It is evident that up to the present time, so far fr ol° gaining ground, the Germans are losing it before Par is; and if the French have such continued success with paratively small numbers of troops, what may be expeet ed° , l „ them when Trochu is able to act with hundreds of thousahu instead of with tens of thousands? One effect o f till; sortie will unquestionably be that a far larger number ° the Prussians than heretofore will have to be kept stantly upon guard in the trenches, to th e i n j ur y of tho health, and to their increasing discontent at the hardships that they are compelled to undergo to gratify the arabitios of their leaders. • From some cause or other—most probably bad weather-- the balloon post from Paris has entirely ceased sin ce the 19th. It is suggested, by more than one English writer tll3 the Germans do not let the whole truth be known re .; specting the French sorties from Paris. The latter lA' claim, at least, some partial successes. The Berlin papers continue to apologise for the long' continued inaction of the German armies before Par is : The warmaterialrequired has been greater than was au ticl i pated, and the difficulty of transporting it has increaser in proportion. "After the fall of Toul," says one paper, " the railway only became available as far as Nantes near Meaux, owing to the blowing up of a tunnel, as oo everything had consequently to be conveyed 50 o r .„ miles by road, which the scarcity of horses and vehic 4 ',': and the destruction of almost all the roa d s for a vita; radius round Paris rendered very laborious. The delay has been solely caused by these difficulties, and not by a n/ political considerations." Amongst the oddities of the war, the NouvelliM (14 Versailles, a daily paper published in French, and c° ll ' ducted under German superintendence, has already b ee h li , noticed. It is devoted to vigorously denouncing , French, and applauding the German, style of conductit the war. The Noavelliste refers in the following terres, the military executions in some districts of F ra nce w ilic n f have been spoken of in the newspapers of Tours as acts 4 ; Vandalism and savagery. It says :—" One has enlY: a look into history to recall by a hundred exampl e s hew with what rigour the French generals have always 9 r„ plied in an enemy's country those laws of war which 31 : rt now in France described as des conventions barbares• '"? will be enough to quote two memorable lines from a let t er of Napoleon L, written on the sth of March, 18 13, Prince Eugbne, who then commanded the French train' on the Elbe On the slightest insult from a Prtosi ° town or village, burn it, were it Berlin itself.'" IRREGULAR WARFARE IN FRANCE• The Moniteur contains the following, under the head ll3 S of " The Francs-Tireurs of the Vosgos A lette r written from the Vosges narrates a curious episode of til e war waged against the Germans by our Francs-Tire lllls ' We have numerous companies of Francs-Tireurs bidden in every corner of the Vosges. They constitu t ' e a formidable force, as they only take the Elite of j r sportsmen, and do not admit any but men of I°, experience. Our Francs-Tireurs sh oo t P russ i an s virl' ° ',, e : sale. I talked to an emissary o f th ese guer ill as of t he Vosges, who told me, while speaking of his compani °9 in arms, ' You must not fancy that they shoot the PIT' . sians indiscriminately—they look out for the cholc o , morsels.' The same emissary told me that he had serv ea as guide to a traveller who carried a carpet-bag, and ga pe himself out to be in the spectacle trade. I observed t° him that it was dangerous to travel, that the country was infested with Prussians. However, on his assurance that a commercial traveller can pass everywh ere ' provided his papers are in order, we proceeded. It "p' , getting dark when he asked where he could remain in safety, so as not to be seen by the Prussians, who se re defiling below along the valley. I led him to a Pa t V where we ascended a steep road. There my spectac le dealer installed himself, opened his carpet-b ag , and Pul le r': out something like an instrument. It was a rifle in thr ee pieces, which were in an instant put together and th e charge put in. I understood, and remained silent. The Prussians continued to pass, and I w as astonishall3l',, Franc-tireur did not fire, for he held his weapon 113 8 3 position for firing. We continued to look dow n , crouch behind a hedge, when all of a sudden I say my compan ion start up at the view of a fine horseman, whose hel m glittered in the light of the moon, and wh o a ppeared i be their chief, to judge by his escort. At this moru eil my companion fired, and I saw the officer tumble ore!' We decamped, and the pretended seller of spectacles, r gun on his shoulder and his bag in his hand, said quietly Let us go on further, and try to find me another gousi place.' I saw him bring down several like this, 51/ „: the Prussians must have been f ur i ous no t to b e a ble b" catch this devil of a fellow, who said sorrowfully to me, It is nevertheless difficult to recognise them, f° : they do not carry any such distin c ti ve mar k s as 01i. officers.'" The Memorial d'Antiens says that General Bourbaki: at present engaged in a tour of insp ec ti on roun d the °J 3. trict under his command. The garrisons of V a l e ncietine' s ' Douai, and Amiens have now been visited. The following quaint entry was in the general order 4 of Prince Frederick Charles some days ago :—•‘ Whorl a gold watch has been found by -- in the v icinity ° Ars-sur-Moselle, the owner may have it on giving a d ea. cription by application to the Etappen Command." General Boyer, according to a statement in the Co/0 4 0 $ Gazette, had his eyes bandaged on reaching the Ge m outposts before Metz, and was take n by railway t° Novant, where, as he had passed the German mility" lines, he was for the first time allowed to look about . Business is generally very slack in France just noW, 1 ° one gentleman is doing a remarkably heavy trade. get 13 is Mr. Remington, the great American ma nu f a cturer g/ t breechloaders. He is the genius of the d e f en ce. 1.1 0 though he can manufacture breechloaders he cannot cre ll " them, and so the supply yet remains very short. 0 q o :land [AD Pills. —Scepti c s .-- . r any persons who once doubted the wonderful curoti g and purifying properties of these Pills, an d oiterwa r t, witnessed the beneficial effects produced by the to I diseases of the digestive organs, have been constrained admit their efficacy, have adopted them a i their WS to domestic aperient, and graciously recommend ther 3 , lo their friends. Holloway's Pill s ac t prinrtrily en Z ei t stomach, which they thoroughly invigor a t e , they t' ra exercise a most wholesome influence over the liver, fro which they immediately remove any congestion or tel t ; rary stagnation of the bile or blood whil e equ al hoe ry are conferred upon the spleen end kidneys. The diso°v e of these pills was indeed a triumph in art. BIRTHS. On the 25th inst., at Blackhall, Baitehory, N. 8., the Hon. Mrs. Trelawny, of a daughter. On the 28th inst, at Thessally House, Lavender-hill, the wife of Edmund U. Barron, of a son. MARRIAGES. On the 27th inst., at St. Luke's, Lower Norwood, C_ ll /: Hill Snell, Esq., of Callington, Cornwall, to Fanf theleldest surviving daughter of John Turner, Esq'' High Wycombe, Bucks. d On the 27th inst., at St. Andrew's, Holborn, Davi Caro b Haggar, of Clifton Lodge, Brunswick-road, Cau l 0 ,0 well, to Isabel Mary, fifth daughter of the late Thou Etheridge. DEATILEr. of B On the 26th inst.., at Brighton, Mr. Robert Bu Boyne. No. 26, Westbourne-grove, ayswater, W. On the 26th inst., W. A. Hubert, Esq., at his res' Mark 3 ate-street, Herta, suddenly, aged 61. London : Printed by GIDEON ACLAND BOYCV9 f fy No. 112, Strand, Printer, and Published by Fjli l e THE SUN Office, No. 112, Strand, in the Precinct of Savoy, in the County of Middlesex. • Monday, October 31,- 1870, 8( r l P