of M. Katakazy, the Russian Minister at Washington. This official had been convicted of intriguing among American politicians to prevent the conclusion of the Treaty of Washington. The inexcusable course taken by the Russian Minister at Washington, the President said, had rendered it necessary to ask for his recall, and to decline any longer to receive that functionary as a diplomatic representative. It was incompatible with the maintenance of selfrespect and with a due regard to the dignity of the country to permit M. Katakazy to continue to hold intercourse with the Government of the United States after his personal abuse of Government officials, and while he was persistently interfering through various channels with the relations between the United States and other Powers. In accordance with these wishes the Government had been relieved of further intercourse with M. Katakazy, and the management of the affairs of the Russian Legation had passed into the hands of a gentleman entirely unobjectionable. The President recommended a diminution of the burdens on the people by modifying both the tax and tariff laws, and then proceeded to discuss other details of domestic concern. In alluding to the position of the South, he proposed that the disfranchisement by classes of former rebels should no longer be retained, but that all should be readmitted to the possession of political privileges, with the exception of a few principals, to be disqualified by name. He mentioned that important reforms in the public offices were in contemplation, and that in fact a Civil Service Commission had been appointed to draw up rules regulating the admission to the clerkships, &c., in the different departments of the State.

The most important document accompanying the Message was the Report of Mr. Boutwell, the Secretary of the Treasury. We here quote some of the comments upon it of the English paper, the Economist, which, after denouncing the well-known Protectionist views of Mr. Boutwell in matters of Trade and Commerce, continues: "In a strictly Treasury sense-apart, that is, from the economic effects of the taxes and expenditure on the country-it would hardly be possible to imagine more flourishing finances than those of America. First of all during the last two years the surpluses have been gigantic :

"The whole of this vast sum has been available for the reduction of the debt. Such a fact is unprecedented in financial history. It may be due partly to the American Constitution, which separates so completely between legislation and administration, the result in fiscal matters being that taxes may be left in existence even contrary to the wish of the Executive, and that the Treasury gets the benefit of those taxes. But, whatever may be the cause, the Americans are entitled to credit for submitting in some way to

great, even if unnecessary, sacrifices for a national object. There was room to suppose that the great reductions effected immediately after the war by means of the outstanding war taxation, and when the yield of the taxes could not be exactly calculated, were to some extent accidental; but the return to the former rate of repayment must be admitted to be more deliberate.

"The next satisfactory fact is the remarkable growth of the revenue over the estimate. It is not true that the large surpluses above mentioned were wholly intended, though the purpose was to have very large surpluses. In addition there has been an elasticity in the growth of American revenue even more remarkable than that with which we are familiar at home. We subjoin below the estimate for 1870-71, as well as the result, and, considering that the estimate was made when nearly six months of the year had passed, the excess of the actual result over the reckoning is indeed most wonderful. The leading changes are,—

It is not always creditable to a Finance Minister to be out in his calculations so much, even when the balance comes in on the right side; but in the peculiar circumstances of America the error was more venial, the growth being comparatively unexpected according to recent experience. That it has occurred is striking proof of the vigour of American industry and the rapidity of the national growth -the most cardinal fact, after all, in American finance. The people are so industrious, and nature has been so bountiful, that, in spite of a system of Protection which would have ruined outright any old country, and which has indisputably done infinite damage to the Americans, the country grows at a rate without example elsewhere, except perhaps in England in a prosperous epoch like the present.

"As regards the prospects of American finance the new facts are very important. The new House of Representatives is certainly leavened to a remarkable extent with Freetraders and revenue reformers, and it is impossible that the Protectionists will have their own way in it as they have hitherto done. Both President Grant and his Secretary to the Treasury suggest important concessions to this party. President Grant, while mainly recommending the abolition of internal taxes, except stamps and the excise on alcoholic drinks and tobacco, also proposes a readjustment of the tariff. His suggestion is- That a careful estimate be made of the amount of surplus revenue collected under the present laws, after providing the current expenses of the Government, the interest account and a sinking fund, and that this surplus be reduced in such manner as to afford the greatest relief to the greatest number. There are many articles not produced at home, but which enter largely into general consumption through articles

which are manufactured at home-such as medicines compounded, &c. from which very little revenue is derived, but which enter into general use. All such articles I recommend to be placed on the free list. Should a further reduction prove advisable, I would then recommend that it be made upon those articles which can best bear it, without disturbing home production or reducing the wages of American labour.' This language, though still Protectionist, is plainly framed with a view to conciliate people who are not Protectionist; and the tone is such that a revisal in a Free-trade spirit might properly be covered by it. Protection, we should infer, is to be maintained in theory, but extensively given up in practice, and the measures suggested are such that by the gradual accumulation of similar measures and one leads to the other-Free-trade would in the end be arrived at. A reduction upon articles 'which can best bear it without disturbing home production or reducing the wages of American labour' is, in fact, the exact kind of reduction which Sir Robert Peel began between 1843 and 1846, and which has ended as we see.

"Mr. Boutwell's suggestion is rather less satisfactory, but it still admits a great deal of the Free-trade demand. He says, 'I respectfully recommend to the consideration of Congress the reduction of the duties on salt to the extent of 50 per cent.; the duty on bituminous coal to 50c. per ton; the reduction of the duty on raw hides and skins, and the removal of all duties from a large class of articles produced in other countries which enter into the arts and manufactures of this country, and which are not produced in the United States, and the revenue from which is inconsiderable. Such a list, with the revenue derived from each article, is in course of preparation, and will be submitted to Congress. The removal of duties from a large class of articles used in manufactures, and the reduction of the duties upon coal, furnish an opportunity for a moderate decrease of the rates of duties upon those products the cost of which will be diminished by these changes.' The abolition of the duties here described would be a great step in advance. The reduction of the duties on salt, coal, and hides would diminish materially the 'protection' now given to certain trades, and the abolition of minor duties would have an importance in relieving trade, as we all know, out of all proportion to the mere amount of the duties collected. But the most important point is that these abolitions and reductions are to be used as furnishing an 'opportunity for a moderate decrease of the rates of duties upon these products, the cost of which will be diminished by these changes.' It is impossible to misunderstand the glance here thrown at the iron, cotton, and woollen manufactures, the products of which are all enhanced in cost by the duties to be abolished. The abolition or reduction of one duty inevitably leads to the abatement of others, and Mr. Boutwell could not go so far as he proposes without practically acknowledging the failure of that thorough-going Protection which the United States has hitherto practised.

"Such is the position and such are the concessions now offered to Free-traders by ardent Protectionists. We infer that Free-trade principles are now on the eve of a very considerable triumph in the United States, and, with the quickness of action characteristic of Americans, it would not be surprising to see the system thrown down almost as quickly as it was set up. Mr. Wells predicts that ten years will not elapse before every vestige of restrictive and discriminating legislation will be stricken from the national statute book.' The consummation may to all appearance come before that, and one of the most potent causes in producing it will have been these very studies in political economy which Mr. Wells issued from time to time in his character of Commissioner of Revenue, and the subsequent essays in which he has enforced the lessons. The sort of facts he observed and reasoned upon were familiar to every student of economic science, and were only what might have been expected; but the American facts were on so large and complete a scale that Mr. Wells's account of the experiments will long remain among the most valuable contributions to the literature of political economy. He has the credit, too, of long ago recommending those very changes which Mr. Boutwell and President Grant are now advocating-in particular, the abolition of small duties yielding little revenue. He was not listened to at the time, but the country is coming round to his views, and he must gain in authority at home accordingly."

The President's Message was well received, and at this time his chances for re-election appeared to be all but decisive. The first business that came up for debate in the Senate regarded the recent frauds at New York, and the proposed appointment of a Committee for the thorough investigation of every branch of the Government service. An affirmative resolution was carried, and an inquiry was ordered to ascertain whether any foreign Minister of the United States was publicly connected with any speculative transactions, or had given the use of his name in their furtherance.

The new Apportionment Bill was passed in the House of Representatives on the 14th, making the new representation in that House 283 in number. This is an increase of forty members over the number in the present House, and gives one representative for about every 133,000 of the population. New Hampshire and Vermont by the Bill each lose one member, but almost every other State gains, the largest gains being,-in Illinois five, and Iowa and Michigan each three. The Bill also provides that no State shall hereafter be admitted to the Union which has not sufficient population to entitle it to one representative, a prohibition which will interfere with the aspirations of Utah, Colorado, and New Mexico.

The year closed with some sounds of the ubiquitous "International." Though there existed branches of the Society in many American cities, it is not believed at present to command a numerous or influential following. It flourished chiefly, however, at New York; and the occasion of Rossel's execution was seized by its

Pro

members to solemnize a funeral procession in his honour. cessions on Sunday are not customary in America, and the authorities desired that if the demonstration must take place, it should be on some other day of the week. The Internationalists were indignant, and appealed to Governor Hoffmann; but he declined to interfere with the previous dictum. At a meeting of the party, a motion was then carried to substitute Christmas Day, but a few malcontents persisted in assembling on Sunday the 10th, and were dispersed by the police. The Internationalists then determined on claiming the following Sunday for their parade; and this time both Governor Hoffmann and the police authorities gave way to their demand. The meeting, however, was but a poor one; only about two thousand persons marched in line. Order was maintained. Among the most conspicuous banners were three bearing the respective mottoes, "The spirit of the Commune expands as the axe is laid on the necks of its martyrs;" "The world is our country to do good our religion;" "And they had all things in common."

BRAZIL.

PEDRO II., the able and enlightened sovereign who, though still in the prime of life, had sat for forty years on the throne of Brazil, quitted his dominion in the early summer of this year, leaving his daughter, Princess Isabel, Countess d'Eu, as Regent, and paid a long visit to Europe. He landed first at Lisbon, and was welcomed by his royal kinsman, the son of Maria da Gloria. Afterwards he went to England; then returned to the Continent; and in the middle of the winter he was at Paris. Every where his activity of movement, his zeal of inquiry into things and institutions, and his rapid intelligence, were topics of remark.

While the Emperor was absent from his country, the Brazilian Chambers passed an Act which Government had long been anxious to carry through, and on the 28th of September it was decreed that Slavery should be abolished throughout the empire of Brazil. The abolition was not to be immediate or abrupt. Existing slaves were in many cases to be slaves still; but facilities for emancipation were given, and all children born of female slaves after the day on which the law passed were to be free unconditionally.

ARGENTINE REPUBLIC.

A TERRIBLE plague at Buenos Ayres this year deserves to be recorded. It commenced in December, 1870, and through January and February it rapidly increased. The English residents removed into the suburbs and country; and they were followed by the native population in such numbers that the means of conveyance were hardly sufficient to carry them away. At its height the mortality