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TWO:Dumouriez had no sooner come into office than he laid down a great military plan. He proposed that wherever France extended to what he called her natural limits��that is, to the Rhine, the Alps, the Pyrenees, and the sea��they should act only on the defensive; but in the Netherlands, where the territory did not extend to the Rhine, and in Savoy, where it did not extend to the Alps, there they should act on the offensive, and carry France to what he called its boundaries by the genuine laws of nature. This plan was adopted. The Austrians had only thirty thousand men in Belgium, and Lafayette was to make a dash on that division of the Netherlands. From Namur he was to push on for Li��ge, which would make him complete master of the country, and was to be strengthened by a reinforcement of thirty thousand infantry, so that he would be seventy-five thousand strong before the Emperor could advance to his attack. Further, while Lafayette was marching from Givet on Namur, a division of his army of ten thousand men, under General Biron, was to march upon Mons, where Beaulieu, the Austrian general, was posted with only two thousand five hundred men. On the same day Major-General Theobald Dillon was to advance with three thousand six hundred men from Lille, in Tournay, and to surprise that place. The French calculated on the support of the Belgians who had been strongly inoculated with the spirit of the Revolution. The two smaller divisions were punctual in their movements; but Lafayette, instead of marching simultaneously, remained strengthening himself in his position at Givet. General Biron set out from Valenciennes, and, on the 29th of April, crossed the Belgian frontiers, and the next day marched towards Mons. But no sooner did the French cavalry come in sight of some light troops, said only to amount to about five hundred men, than they fled, crying that they were betrayed. Beaulieu's horse pursued and captured Biron's baggage and military chest. On the very same day, Dillon's division, on their march from Lille to Tournay, fled with the very same cry from nine hundred Austrians who had issued from Tournay. The French officers in vain endeavoured, in both cases, to rally their forces, and Dillon was murdered by his own men on re-entering Lille with a lieutenant-colonel and an unsworn priest. Lafayette, hearing this strange news, did not venture to quit Givet.The distress which had pressed so severely on the people, and which had set them thinking about the most perilous political changes, was intimately connected with the state of the country. Throughout the troubled period of almost incessant war and lavish expenditure between 1797 and 1815, the business of the nation was carried on with an inconvertible paper currency, the precious metals having nearly all departed from the country. Bank notes were issued in such quantities, to meet the exigencies of the Government, that the prices of all commodities were nearly doubled. The Bill which was passed in 1819 providing for the resumption of cash payments had reduced the currency from ��48,278,070, which was its amount in 1819, to ��26,588,000, in 1822. The consequence was the reduction of prices in the meantime, at the rate of fifty per cent., in all the articles of production and commerce. With this tremendous fall of prices, the amount of liabilities remained unchanged; rents, taxes, and encumbrances were to be paid according to the letter of the contract, while the produce and commodities��the sale of which was relied upon to pay them��did not produce more than half the amount that they would have brought at the time of the contracts. The evil of this sudden change was aggravated by the South American Revolution, in consequence of which the annual supply of the precious metals was reduced to a third of its former amount. It was peculiarly unfortunate that this stoppage in the supply of gold and silver occurred at the very time that the Legislature had adopted the principle that paper currency should be regarded as strictly representing gold, and should be at any moment convertible into sovereigns. A paper currency should never be allowed[238] to exceed the available property which it represents, but it is not necessary that its equivalent in gold should be lying idle in the coffers of the Bank, ready to be paid out at any moment the public should be seized with a foolish panic. It is enough that the credit of the State should be pledged for the value of the notes, and that credit should not be strained beyond the resources at its command. The close of 1822 formed the turning-point in the industrial condition of the country. The extreme cheapness of provisions, after three years of comparative privation, enabled those engaged in manufacturing pursuits to purchase many commodities which they had hitherto not been able to afford. This caused a gradual revival of trade, which was greatly stimulated by the opening of new markets for our goods, especially in South America, to which our exports were nearly trebled in value between 1818 and 1823, when the independence of the South American Republics had been established. The confidence of the commercial world was reassured by the conviction that South America would prove an unfailing Dorado for the supply of the precious metals. The bankers, therefore, became more accommodating; the spirit of enterprise again took possession of the national mind, and there was a general expansion of industry by means of a freer use of capital, which gave employment and contentment to the people. This effect was materially promoted by the Small Note Bill which was passed in July, 1822, extending for ten years longer the period during which small notes were to be issued; its termination having been fixed by Peel's Bill for 1823. The average of bank-notes in circulation in 1822 was ��17,862,890. In November of the following year it had increased by nearly two millions. The effect of this extension of the small note circulation upon prices was remarkable. Wheat rose from 38s. to 52s., and in 1824 it mounted up to 64s. In the meantime the bullion in the Bank of England increased so much that whereas in 1819 it had been only ��3,595,360, in January, 1824, it amounted to ��14,200,000. The effect of all these causes combined was the commencement of a reign of national prosperity, which burst upon the country like a brilliant morning sun, chasing away the chilling fogs of despondency, and dissipating the gloom in the popular mind.

TWO:Before quitting Germany, however, George had signed a treaty between himself, Austria, and Sardinia, in which Italian affairs were determined. The Spaniards, under Count Gages and the Infant Don Philip, had made some attempts against the Austrians in Italy, but with little effect. By the present treaty, signed at Worms on the 13th of September, the King of Sardinia engaged to assist the Allies with forty-five thousand men, and to renounce his pretensions to the Milanese, on condition that he should command the Allied army in Italy in person, should receive the cession of Vigevenasco and the other districts from Austria, and a yearly subsidy of two hundred thousand pounds from England. This was also negotiated by Lord Carteret on the part of King George, and without much reference to the Ministers in England, who, on receiving the treaty, expressed much dissatisfaction; but, as it was signed, they let it pass. But there was another and separate convention, by which George agreed to grant the Queen of Hungary a subsidy of three hundred thousand pounds per annum, not only during the war, but as long as the necessity of her affairs required it. This not being signed, the British Ministers refused to assent to it, and it remained unratified.In this situation the English General determined to attempt��what he should have attempted at first��to force the American lines. Accordingly, on the 7th of October, he drew out one thousand five hundred picked men, and formed them less than a mile from the American camp. No sooner were they descried, than they were attacked furiously by Poor's New Hampshire brigade. The attack extended rapidly to the right, where Morgan and his rifle corps stole round through some woods, and opened fire on the flank of the column. Other troops rushed out of the American entrenchments, and endeavoured to force their way between the British and their camp; but Major Ackland and his riflemen withstood them bravely; yet Burgoyne and his one thousand five hundred men were forced to fall back, leaving their cannon behind them. Morgan and his riflemen were now arriving, under cover of the woods, near the flank of the right wing; and Fraser, perceiving them, advanced to dislodge them. In this he succeeded, but was picked off by the American marksmen, as usual safe behind their trees, and fell mortally wounded. Meanwhile Colonel Brooks, at the head of Jackson's regiment of Massachusetts, was more successful. He turned the entrenchments of the German brigade, maintained his ground within the lines, and, to the wonderful relief of the Americans, seized the baggage of the Germans, and an ample supply of ammunition.

TWO:The year 1812 opened, in England, by the assembling of Parliament on the 7th of January. The speech of the Regent was again delivered by commission. The great topic was the success of the war in Spain under Lord Wellington, whose military talents were highly praised. There was a reference also to the disagreements with America, and the difficulty of coming to any amicable arrangement with the United States. Lords Grey and Grenville, in the Peers, pronounced sweeping censures on the continuance of the war with France, and on the policy of Ministers towards America, from which source they prognosticated many disasters. In the Commons, the Opposition used similar language; and Sir Francis Burdett took a very gloomy view of our relations both with France and North America, and declared that we could anticipate no better policy until we had reformed our representative system.