Mr. Wm. R. Clark, acting master, was directed to proceed with all possible despatch and report to the senior commanding officer of the Gulf squadron for instructions.

In addition to the above, I boarded ship Janico from Mobile, ship Carl and bark Mary from New Orleans, all loaded with cotton, and with registers indorsed; also ship Bramley Moore, from New Orleans, register not indorsed, but allowed her to proceed upon her voyage, as the time granted vessels to clear, according to the notification of blockade, had not expired. Very respectfully, MELANCTON SMITH,

The COMMANDING OFFICER

Commander.

Gulf Squadron, Pensacola.

[Indorsement by Captain Adams.]

JUNE 10, 1861.

At the time the Perthshire was boarded from this ship and ordered off from Pensacola there was no blockade of Mobile or the Mississippi river.

H. A. ADAMS,

Captain U. S. Frigate "Sabine."

Mr. Seward to Lord Lyons.

DEPARTMENT OF STATE, Washington, October 24, 1861.

MY LORD: Your letter of the 11th of October last, presenting the claim of Mr. William Gray, owner of the British ship "Perthshire," for damages incurred by the detention of that vessel by the blockading squadron of the United States, was referred by me to the Secretary of the Navy for information upon the subject.

I have now received the answer of the Secretary of the Navy thereupon, which fails to show me that the detention of the Perthshire by Commander Smith, commanding the United States steamer Massachusetts, was warranted by law or by the President's proclamation instituting the blockade, although I am satisfied that that officer acted under a misapprehension of his duties, and not from any improper motive. It will belong to Congress to appropriate the sum of two hundred pounds, claimed by Gray, which sum seems to me not an unreasonable one. The President will ask Congress for that appropriation as soon as they shall meet, and he will direct that such instructions shall be given to Commander Smith as will caution him against a repetition of the errors of which you have complained.

I avail myself of this opportunity to renew to your lordship the assurance of my high consideration."

The Right Hon. Lord LYONS, &c., &c., &c.

WILLIAM H. SEWARD.

SIR: It seems to me that our mission to Austria has not been made as useful hitherto as it ought to have been. I think, indeed, that it has generally been undervalued, The causes for this are manifest. We are a commercial people, and of course cultivate acquaintance first and chiefly with other commercial nations. Situated on a long Atlantic coast, and confronting on the opposite shore the commercial countries from whence our population was first and principally derived, we have naturally fallen into relations with them of the most intimate kind. Austria is distant, and it has never been a maritime nation.

To go no further in the review of its history than 1815, the Austrian government has been that one of the great European powers which has maintained more studiously, firmly, and persistently than any other, the principles of unlimited monarchy, so opposite in their character to the principles upon which our own government has been established.

Again, Austria is not an unique country with a homogeneous people. It is a combination of kingdoms, duchies, provinces, and countries, added to each other by force, and subjected to an imperial head, but remaining at the same time diverse, distinct, and discordant. The empire is therefore largely destitute of that element of nationality which is essential to the establishment of free intercourse with remote foreign States. This absence of nationality is observable in the Austrian emigration to the United States. We meet everywhere here, in town and country, Italians, Hungarians, Poles, Magyars, Jews, and Germans, who have come to us from that empire, but no one has ever seen a confessed Austrain among us. So when a traveller visits Austria he passes through distinctly marked countries, whose people call themselves by many different names, but none of them indicative of their relation to the empire.

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Our representatives at Vienna seem generally to have come, after a short residence there, to the conclusion that there was nothing for them to do and little for them to learn. The President expects that you will be diligent in obtaining not only information about political events, but also commercial and even scientific facts, and in reporting them to this department. Austria is an interesting field for improvement of that kind. Although Lombardy, with other Italian provinces, has recently been lost, yet the empire still has a population little inferior in number to our own; and though there are some nations whose people are more mercurial, there is no one in the whole world whose inhabitants are more industrious, frugal, cheerful, and comfortable; none in which agriculture derives more wealth from hard soils and ungenial skies; none where science, art, and taste mingle so perfectly with public and private economy. An undue portion of the country is mountainous. It has never

theless a richness and variety of mineral and vegetable wealth unequalled in any other part of Europe. Many of its productions could, if introduced more freely, find a ready consumption here, while, on the other hand, we could supply Austria with materials and provisions which are now at greater cost received by her from other countries. Many of the Austrian productions and fabrics which we do receive come to us through the hands of merchants in other European States.

The insignificance of our commerce with Austria results in a large degree from her policy of taxing exports as well as imports, and from monopolies, by which she labors to create a national system of navigation. The subject is one of great interest, and you can render an important service probably to both countries by applying yourself to an examination of it with a view to the negotiation of a more liberal treaty than the one now in force.

Just now a pressure upon this department, incidental to the beginning of a new administration, renders it impossible for me to descend into the details which must be considered in this connexion. It is, however, a purpose of the President that the subject shall be thoroughly investigated, and you will in due time be fully instructed. In the meanwhile you are authorized to communicate his disposition in this respect to the government of his Imperial Royal Majesty, and to ascertain, if possible, whether it would be willing to enter into a revision of the commercial arrangements now existing between the two nations.

The President is well aware that the government of Austria is naturally pre-occupied with political questions of great moment. It must be confessed, also, that painful events occurring among ourselves have a tendency to withdraw our thoughts from commercial subjects. But it is not to be doubted, in the first place, that political embarrassments would in both countries be essentially relieved by any improvement of their commerce which could be made; and, secondly, that the greater those embarrassments are the more merit there will be in surmounting them so far as may be necessary to effect that improvement. It certainly is not the intention of the President that the progress in material and social improvement which this country has been making through so many years shall be arrested or hindered unnecessarily by the peculiar political trials to which it seems likely to be subjected during the term for which he has been called to conduct the administration of its affairs.

There is a peculiar fitness in efforts at this time to enlarge our trade in the Mediterranean, for it is never wise to neglect advantages which can be secured with small expense, and near at home, while prosecuting at great cost, as we are doing, great enterprises in remoter parts of the world. I would not overlook Italy, Germany, and Hungary, while reaching forth for the trade of China and Japan.

I shall allude to political affairs in Austria only so far as is necessary to enable me to indicate the policy which the President will pursue in regard to them. They present to us the aspect of an ancient and very influential power, oppressed with fiscal embarrassments, the legacy of long and exhausting wars, putting forth at one and the same time efforts for material improvement, and still mightier ones to protect its imperfectly combined dominion from dismemberment and disintegration, seriously menaced from without, aided by strong and intense popular passions within. With these questions the government of the United States has and can have no concern. In the intercourse of nations each must be assumed by every other to choose and will what it maintains, tolerates, or allows. Any other than a course of neutrality would tend to keep human society continually embroiled in wars, and render national independence everywhere practically impossible.

No institutions which can be established in a country through foreign intervention can give to it security or other advantages equal to those which are afforded by the system it establishes or permits for itself; while every nation must be regarded as a moral person, and so amenable to the public opinion of mankind, that opinion can carry its decrees into effect only by peaceful means and influences. These principles, hitherto practiced by the United States with great impartiality, furnish rules for the conduct of their representatives abroad, and especially for your own in the critical condition of political affairs in the country to which you are accredited.

This intimation is given so distinctly because an observance of it is peculiarly important in the present condition of our domestic affairs. We are just entering on a fearful trial, hitherto not only unknown, but even deemed impossible by all who have not been supposed to regard the career of our country, even under auspicious indications, with morbid distrust.

Ambitious and discontented partisans have raised the standard of insurrection and organized in form a revolutionary government. Their agents have gone abroad to seek, under the name of recognition, aid and assistance. In this case imprudence on our part in our intercourse with foreign nations might provoke injurious, possibly dangerous, retaliation.

The President does not by any means apprehend that the imperial royal government at Vienna will be inclined to listen to those overtures. The habitual forbearance of his Majesty, the friendship which happily has always existed between the two countries, and the prudence which the government of the former has so long practiced in regard to political affairs on this continent, forbid any such apprehension.

Should our confidence in this respect, however, prove to be erroneous, the remarks which I shall have occasion to make with a different view in this paper will furnish you with the grounds on which to stand while resisting and opposing any such application of the so-called Confederate States of America.

Vienna, as you are very well aware, is a political centre in continental Europe. You may expect to meet agents of disunion there seeking to mould. public opinion for effect elsewhere.

I will not detain you with a history of that reckless movement, or with details of the President's policy in regard to it. Your experience as a prominent member of Congress has already furnished the former. The inaugural address of the President, with despatches to your predecessor, will be found in the archives of the legation, and will supply the latter.

Certainly I shall not need to anticipate and controvert any complaints of injustice, oppression, or wrong, which those agents may prefer against their country before foreign tribunals. Practically, the discontented party itself administered this government from the earliest day when sedition began its incubation until the insurgents had risen and organized their new provisional and revolutionary government. Never, in the history of the human race, has revolution been so altogether without cause, or met with forbearance, patience, and gentleness so long.

Nor shall I notice particularly the apprehensions of future injustice and oppression which, in the absence of real cause, are put forth as grouuds for the insurrection. The revolutionists will find it very hard to make any European sovereign, or even any European subject, understand what better or further guarantee they could have of all their rights of person and property than those which are written in the Constitution of the United States, and which have never been by the government of the United States broken or violated either in letter or in spirit. They will find it quite as difficult to make either a European sovereign or subject understand how they can rea