Mr. Hay to Mr. Seward

No. 371.]

Sir: The Moniteur of yesterday contained the following announcement: “The president of the commission of finances of Mexico, at Paris, informs the holders of Mexican securities and bonds that no funds having been received from the Mexican government for the payment of the interest and coupons falling due on the 1st October next, that payment will be adjourned.

“The president of the commission at the same time reminds the holders of Mexican bonds that in conformity with the original conditions of the contract, a capital of thirty-four millions of francs, deposited in the Caisse des Depots et Consignations and invested in three per cent. securities, is to be applied by means of the quarterly capitalization of the interest to the reconstitution of their capital.”

This announcement is dated two days before its publication, September 18, 1866. Although not wholly unexpected, it produced a decidedly depressing effect upon the Bourse. Mexican bonds fell thirty francs, and other stocks experienced a serious check in the upward movement which has been in progress for some time past.

I annex an extract from an article of Mr. Forcade, in Revue des Deux Mondes, in reference to the immediate prospects of the Mexican empire and the mission of General Castelnau, which is noticeable for its freedom of statement. A leading article in much the same sense appeared a few days since in La Liberte, the journal conducted by M. de Girardin, which urged the immediate recognition by France of President Juarez, and the arrangement of a treaty with him, as the sole practicable means of securing protection to French citizens in Mexico.

I am, sir, with great respect, your obedient servant,

JOHN HAY, Chargé d’Affaires ad interim.

Hon. William H. Seward, Secretary of State, Washington, D. C.

[Mr. Forcade, in the Revue des Deux Mondes.—Translation.]

When it was decided to recall the French troops from Mexico, it was believed and announced that the return could take place in three successive divisions; the first being fixed for the month of November next. Many people were alarmed at this project of partial and [Page 357] gradual evacuation. It seemed to them perilous to weaken our army at the moment when the relative force and audacity of our adversaries would be augmented by our withdrawal, and thus, perhaps, draw on our last battalions all the efforts of the enemy. The question of departure was also governed by the political state in which we should leave Mexico. Would the emperor Maximilian persist alone in the enterprise in which he followed us, and where he has shown that he cannot render us any service; or would he renounce the adventure and return to Europe with us? In the case of the abdication of Maximilian, could we leave Mexico without giving that unhappy country time to organize a government to its taste, with which we might negotiate and establish the future relations of France. A little reflection will show that, to solve these different questions in the least troublesome manner, they must be settled simultaneously. It is necessary to know whether Maximilian stays or leaves; and in order that the security and dignity of our army may not be endangered, it is necessary that the return of our troops should not be accomplished successively, but all at once. It is evidently the strict examination and the categorical solution of these questions which the Emperor has confided to General Castelnau in sending him to Mexico, charged with a mission doubtless painful, but the results of which might be highly important for the interests of France. The great thing in this difficult operation of putting an end to our expedition is to cut short the evil and not allow it to drag on. For us, who have no confidence in the establishment of an imperial dynasty in Mexico, we should wish that the emperor Maximilian should decide on a retreat. In any case it is to be desired that the French army, in order to withdraw in the plenitude of its strength, should be concentrated in the capital, and march en masse to the coast. Our military honor and the interest we have in occupying the second port of Mexico, will doubtless oblige us to retake Tampico. (Since reported to have been retaken.) Masters of Vera Cruz and Tampico, we shall be able to organize the simultaneous embarcation of our soldiers, and, besides, to retain the two most important maritime cities of the country, until we have made the necessary arrangements with the new government. If no time is lost, as we have the favorable season before us, the march of our troops to the coast and their embarcation could be completed in six months.