On the 6th of May Burke had brought forward a measure for the benefit of his long-oppressed country, to the effect that Ireland should enjoy the privilege of exporting its manufactures, woollen cloths and woollens excepted, and of importing from the coast of Africa and other foreign settlements all goods that it required, except indigo and tobacco. The Irish were to have the additional privilege of sending to England duty-free, cotton-yarns, sail-cloth, and cordage. Parliament, for once, looked on these demands with favour. They recollected that the Americans had endeavoured to excite disaffection amongst the Irish by reference to the unjust restrictions on their commerce by the selfishness of England, and they felt the loss of the American trade, and were willing to encourage commerce in some other direction. Lord Nugent co-operated with Burke in this endeavour. But the lynx-eyed avarice of the English merchants was instantly up in arms. During the Easter recess, a host of petitions was got up against this just concession. The city of Bristol, which was represented by Burke, threatened to dismiss him at the next election, if he persisted in this attempt to extend commercial justice to Ireland; but Burke told them that he must leave that to them; for himself, he must advocate free trade, which, if they once tried it, they would find far more advantageous than monopoly. They kept their word, and threw him out for his independence. At the same time, the English merchants, as they had always done before by Ireland, triumphed to a great extent. They demanded to be heard in Committee by counsel, and the Bills were shorn down to the least possible degree of benefit.

During the discussion of this question, Sir George Savile brought forward another. This was a Bill for relieving Catholics, by repealing the penalties and disabilities imposed by the 10th and 11th of King William III. The hardships sought to be removed were these:—The prohibition of Catholic priests or Jesuits teaching their own doctrines in their own churches, such an act being high treason in natives and felony in foreigners; the forfeitures by Popish heirs of their property who received their education abroad, in such cases the estates going to the nearest Protestant heir; the power given to a Protestant to take the estate of his father, or next kinsman, who was a Catholic, during his lifetime; and the debarring all Catholics from acquiring legal property by any other means than descent. Dunning declared the restrictions a disgrace to humanity, and perfectly useless, as they were never enforced; but Sir George Savile said that was not really the fact, for that he himself knew Catholics who lived in daily terror of informers and of the infliction of the law. Thurlow, still Attorney-General, but about to ascend the woolsack, promptly supported the Bill; and Henry Dundas, the Lord Advocate of Scotland, lamented that it would afford no relief to his own country. These Acts did not affect Scotland, as they had been passed before the Union; but Scotland had a similar Act passed by its own Parliament, and he promised to move for the repeal of this Scottish Act in the next Session. In the Commons there was an almost total unanimity on the subject; and in the Lords, the Bishop of Peterborough was nearly the only person who strongly opposed it. He asked that if, as it was argued, these Acts were a dead letter, why disturb the dead?

But smoothly as this transaction had passed, there was a hurricane behind. The threatened extension of the measure to Scotland roused all the Presbyterian bigotry of the North. The synod of Glasgow and other synods passed resolutions vowing to oppose any interference with the Scottish Act for the suppression of Popery. Press and pulpit were speedily inflamed; associations were formed in Edinburgh, Glasgow, and most of the towns, for the defence of the Protestant interest. All the old persecutions and insults of Catholics were renewed; they could not safely appear in the streets, or remain safely in their houses. Not even those liberal enough to advocate the just rights of Catholics were secure, at least from rude treatment. Dr. Robertson, the historian, was hooted, when he went abroad, as a favourer of the Papists. There was as yet no more toleration in Scotland than if a William III. had never appeared in England. From Scotland the intolerant leaven spread southwards. It grew fiercer and fiercer, and in a while found a proper champion in the hot-headed Lord George Gordon, whose exploits as the ringleader of riot, and fire, and confusion, culminated two years later in the scenes of destruction and terror for ever memorable as the Gordon riots.

In Europe war was about to break forth, in consequence of war in America. Yet the Court of France did not lack solemn warnings of the fatal path on which they were entering. The honest and far-sighted financier, Turgot, who had been employed by Louis XVI., as Comptroller-General, to endeavour to bring the terribly disordered revenue of France into order, said, "I must remind you, sire, of these three words—'No bankruptcy, no augmentation of imposts, no loans.' To fulfil these three conditions there is but one means—to reduce the expenditure below the receipt, and sufficiently below it to be able to economise, every year, twenty millions, in order to clear off the old debts. Without that, the first cannon fired will force the State to bankruptcy." He assured the king that all colonies, on arriving at a condition of maturity, would as naturally abandon the control of the mother country as children, arriving at majority, do the control of their parents; that the independence of America would, therefore, come of itself, without France ruining herself to accelerate the event; that, as to France wishing Spain to join in this attempt, Spain must remember her own colonies, for, by assisting to free the British colonies, she would assuredly assist to liberate her own.

Before there was any declaration of war, the King of France, on the 18th of March, issued an order to seize all British ships in the ports of that kingdom; and, nine days afterwards, a similar order was issued by the British Government as to all French ships in their harbours. The first act of hostility was perpetrated by Admiral Keppel. He had been appointed first Admiral on the earliest news of the treaty of France with America; and, being now in the Channel with twenty ships of the line, he discovered two French frigates, La Licorne and La Belle Poule, reconnoitring his fleet. Not troubling himself that there had been no declaration of war, Keppel ordered some of his vessels to give chase; and, on coming up with the Licorne, a gun was fired over her, to call her to surrender; and the Frenchman struck his colours, but not before he had poured a broadside into the America, commanded by Lord Longford, and wounded four of his men. The "saucy" Arethusa, famed in song and story, in the meantime, had come up with the Belle Poule, and, after a desperate action, drove her in amongst the rocks, whilst the Arethusa herself was so disabled as to require towing back to the fleet. A schooner and a French frigate were soon afterwards taken; and, finding on board these vessels papers stating that the fleet in Brest harbour consisted of thirty-two sail of the line and ten or twelve frigates, Keppel returned to Portsmouth for reinforcements.

For this Keppel was much blamed, as it was considered that the papers might have been made out in order to deceive him. The number of the French fleet, however, soon proved to be correct, for, during Keppel's absence, it sailed out of Brest, under the command of Admiral D'Orvilliers. Keppel, returning with his squadron augmented to thirty vessels of the line, found D'Orvilliers out at sea, and the Lively, twenty-gun brig, which he had left to watch the motions of the French, surprised by them in a fog, and captured. On the 27th of July Keppel came up with D'Orvilliers off Ushant, and instantly gave battle. The two fleets passed each other on different tacks, keeping up a furious cannonade for two hours. Keppel then signalled his second in command, Sir Hugh Palliser, to wear round and renew the attack; but Palliser had received so much injury, that he could not or did not obey the signal. Keppel, therefore, bore down to join Palliser's division, and formed afresh for the fight. But by this time D'Orvilliers was making for Brest as fast as he could, claiming a victory. Night came down, and the next morning the French fleet was nearly out of sight. On this, Keppel returned to England to refit, much out of humour with Palliser.

Meanwhile, in America military intrigues were on foot against Washington. Amongst these endeavours was one for alienating from him Lafayette. For this purpose an expedition was planned against Canada, and Lafayette, as a Frenchman, was appointed to the command, hoping thus to draw to him the Frenchmen of Canada. Not a word was to be breathed of it to Washington; and Conway and Starke, two of the most malicious members of the cabal, were to take command under Lafayette. On the 24th of January, 1778, Washington received a letter from Gates, the President of the Board of War, commanding him to send one of his best regiments to Albany, on the Hudson, for a particular service, and enclosing another to Lafayette, requiring his immediate attendance on Gates. Gates found, however, that Lafayette was not to be seduced from his attachment to Washington. He would not accept the command, otherwise than as acting in subordination to his Commander-in-Chief; and he should send all his despatches and bulletins to him, at the same time that he furnished copies to Congress. The vain Frenchman verily believed that he was going to restore Canada, not to America, but to the French Crown—a fear which began to haunt Congress after he had set out; but the fear was needless. When Lafayette reached his invading army, instead of two thousand five hundred men, it amounted to about one thousand two hundred, and the militia were nowhere to be heard of. Clothes, provisions, sledges, were all wanting, and, instead of leading his troops, as he was directed, to Lake Champlain, whence he was to proceed to Île-aux-Noix to blow up the English flotilla, and thence, crossing the Sorel, to descend the St. Lawrence to Montreal, he gave up the expedition with a sigh, and returned to the camp of Washington.

In the month of April arrived the permission for Sir William Howe to retire, and, although he was one of the five Commissioners named for carrying into effect the proposals in Lord North's Bill, he determined to leave at the earliest day for England. Lord Howe, the Admiral, was equally impatient to return, but Lord Sandwich had informed him that it would be considered a great misfortune for him to quit his command in the present circumstances. This was, in fact, an order for his remaining, which the breaking out of the war with France, and the expected arrival of a French fleet, rendered doubly imperative. Sir Henry Clinton was appointed to succeed Sir William Howe, and, the former having arrived in Philadelphia, Howe departed. Scarcely had Clinton assumed the command, when an order arrived from the Government at home to abandon Philadelphia, and concentrate his forces at New York. The French fleet under D'Estaing was on its way, and it was considered that we had not a fleet of sufficient strength to beat them back from the mouth of the Delaware.

On the 6th of June—only a fortnight after Howe's departure—the three Commissioners, Lord Carlisle, Mr. Eden, and Governor Johnstone, arrived. They learned with consternation and unspeakable chagrin this order for the evacuation of Philadelphia, and, still more, that so important a dispatch had been kept concealed from them. There was not a single circumstance in favour of the Commissioners. At the same moment that we were making this disastrous retreat from the hardly-won Philadelphia, publishing our weakness to the world, Congress had just received the mighty news of French alliance, French aid, and French ships and troops steering towards their coasts. The Commissioners came furnished with propositions the most honourable and favours the most absolute. They were authorised to offer to the Americans that no military forces should be maintained in the Colonies without the consent of the General Congress or of the Assembly of a particular State; that England would take measures to discharge the debts of America, and to give full value to its paper money; would admit an agent or agents from the States into the British Parliament, and send, if they wished it, agents to sit with them in their Assemblies; that each State should have the sole power of settling its revenue, and perfect freedom of internal legislation and government—in fact, everything except total severance from the parent country. Such terms, conceded at the proper time, would have made war impossible; but the proper time was long past, and they were now useless. The Commissioners applied to Washington for a passport to Congress, in order to lay the proposals brought by the Commissioners before them. But Washington bluntly refused the passport; and only consented to forward the letter through the common post. Congress took time to deliberate on the contents of the letter, and then returned an answer through their President, that the Act of Parliament and the forms of the Commission all supposed the American States to be still subject to Great Britain, which had long ceased to be fact; and that Congress could listen to no overtures from the King of England until he had withdrawn his fleet and armies, and was prepared to treat with them as independent States. The Commissioners could only retire, leaving behind them a manifesto threatening the utmost severities of war.

Clinton, having now united his forces at New York, directed his attention to the approach of the fleet of D'Estaing. This had sailed for the Delaware, expecting to find Lord Howe there; but, finding that he had sailed for New York, it followed him, and arrived there six days after him. The fleet of D'Estaing consisted of twelve sail-of-the-line and six frigates. Howe had only ten sail-of-the-line, and some of them of only forty or fifty guns, and a few frigates. Besides, D'Estaing had heavier metal, and ships in much better condition, for those of Howe were old and out of repair, and their crews were considerably deficient. Altogether, D'Estaing had eight hundred and fifty-four guns; Howe, only six hundred and fourteen. From D'Estaing's superiority of force it was quite expected that he would attack Howe; but he was dissuaded by the pilots from entering the harbour, and lay outside eleven days, during which time he landed the Ambassador. Lord Howe showed much spirit in preparing for an encounter, though he was daily in expectation of Admiral Byron with some additional ships, the Admiral coming to supersede him. He put his ships in the best order he could, and the English seamen hurried in from all quarters to man his vessels. A thousand volunteers came from the transports, and masters and mates of merchantmen offered their services. Just, however, when it was expected that D'Estaing would avail himself of the tide, on the 22nd of July, to enter the harbour, he sailed away for Rhode Island, and up the Newport river. In a few days Howe sailed in quest of D'Estaing. They found D'Estaing joined by Lafayette with two thousand American troops, and by General Sullivan with ten thousand more, and D'Estaing proposed to land four thousand from his fleet. The English garrison in Newport amounted to only five thousand men. But here a contest arose between D'Estaing and Sullivan for the supreme command, and this was not abated till Howe with his fleet hove in sight. Then D'Estaing stood out to sea, in spite of the remonstrances of Sullivan, Greene, and the other American officers. Lord Howe endeavoured to bring him to action, at the same time manœuvring to obtain the weather-gauge of him. In these mutual endeavours to obtain the advantage of the wind, the two fleets stood away quite out of sight of Rhode Island, and Sullivan commenced in their absence the siege of Newport. Howe, at length, seeing that he could not obtain the weather-gauge, determined to attack the French to leeward, but at this moment a terrible storm arose, and completely parted the hostile fleets, doing both of them great damage. D'Estaing returned into the harbour of Newport, but only to inform the Americans that he was too much damaged to remain, but must make for Boston to refit. Sullivan and the other officers remonstrated vehemently against his departure; but in vain. Scarcely had D'Estaing disappeared, when Sir Henry Clinton himself, leading four thousand men, arrived in Rhode Island, and Sullivan crossed to the mainland in haste. He blamed the French for the failure of the enterprise.