I began by stating under two distinct heads the original object of my being sent here, and what had since happened. First, that I had been commissioned to explain the grounds on which you had wished to stand against further concessions, your reasons for imagining it doubtful whether that ground could be maintained, and your certain conviction that it could be done only by an immediate dissolution of Parliament. The second point I said was, that, by what had since happened, you apprehended that something further was made necessary, and this was the more evident from the manner in which every one had taken up the business in Ireland.

These two points, of course, led us into a very wide field of conversation. As to the dissolution, I said you certainly would not press the Ministry for any more on the subject, than that, even with a peace, and a remedy to the business of the King's Bench, it should not be delayed beyond the end of January. The great object, he said, was at all events not to meet till October. My answer was, that to you, who were personally to meet the difficulties of an earlier meeting, they certainly would appear quite as strong as they could to him sitting at a distance and speculating upon them. It was therefore by no means a thing to be wished by you, but an evil which circumstances might render necessary. This led me to a mention of several causes of discontent which might arise or be sought for, and which could only be prevented by the Irish Parliament; such as an infringement, for instance, of the East India monopoly. We went, at different periods of the conversation, a good deal into this business. He threw out an idea, which he said had been often mentioned, and for which a foundation was certainly laid in the last resolution of the English Houses on Irish affairs, if we chose to pursue it. This was the fixing, by a sort of treaty, a commercial system between the two countries, and a proportionable contribution to be paid by Ireland for the general protection of the empire.

When I mentioned the objection to this, founded on the impossibility that Ireland could in her present situation contribute such a quota as would hereafter be even infinitely too small for her share, he answered it by stating the possibility of having a tax on some particular article or description of articles applicable to this purpose, which might be so fixed as to be small at present, very small if necessary, but which might increase with the wealth and commerce of Ireland. On this idea of a settlement, our conversation dwelt a good deal. I expressed my opinion that it would be, in many points of view, a measure of dignity and weight, and particularly advantageous to both countries, as it would leave no ground of contest unexplained. But at the same time I thought the present moment unfavourable for such a step, because it ought not to be taken till Government in Ireland recovered its energy; otherwise, I stated that the wildest idea that could be broached in a newspaper would be adopted by those in whom the real Government of the country resides at the present moment; that, till the Volunteers have in some degree subsided, your Government could only subsist by expedients, painful as such an idea must be to your feelings. I stated also, that if this was to be held out to the country as the satisfaction and security to which they were to look, it would set all their heads afloat forming systems of trade and government; and that it would make the spring meeting absolutely necessary, from the impatience it would excite and the necessity of its being done by Parliament.

From this we went into the present situation of your Government. Upon this he desired to explain himself, and that I would state to you that he was inclined to think, not that he thought, your Government would go on more easily there than you expected. He alluded to De Retz's maxim: "Le peuple ne se soulève jamais que quand on l'opprime." To the truth of this I agreed perfectly, but said that the people there are really oppressed, and miserable to a degree I had not at all conceived till I went into the country. That nothing was more usual than for the people to mistake the cause of grievances which they really feel, and that this I apprehended to be the case there. In that case, he said, the remedy was at hand; for that an extended commerce and the wisdom of internal regulations, would relieve the evil, and be a pleasant task to your Government. I answered that such remedies must be gradual, while the situation of Ireland was pressing at this moment; and that perhaps nothing had contributed more to the discontents now prevalent, than the foolish expectations of wealth to be poured like a torrent into the country by a free trade. To this he agreed, but said that laws might certainly be devised by which such remedies might be brought forward and hastened. Then he went into the nature of absentee laws. Direct absentee taxes were, he said, highly objectionable, but many things might be thought of which would produce the effect so reasonably to be wished, that the money arising from land in Ireland should not be spent elsewhere. All methods to raise the value of that land would operate to that effect; because, when the person residing in England saw the means of getting an equivalent, he would certainly prefer an estate at his own door to one in Ireland. Still, however, this would be gradual.

With respect to the Volunteer force, he apprehended less embarrassment from them, because he could not believe that five thousand of them would ever bring themselves to march ten miles together. I said, perhaps not, but that they had each the means of resisting the execution of any law they disliked in their own places of residence; whilst your whole army did not amount, without the Provincials, to six thousand men. And in time of peace, the Provincials were to be disbanded, and only twelve thousand men could be brought back upon the establishment. He asked whether the Provincials could not be made permanent. I said, I apprehended not, and that possibly the attempt would not be wise; for that, although you had, by the most determined perseverance and by an unremitted firmness, carried the point with respect to their being raised, yet I thought that would be sufficient to show the steadiness of Government, without seeking unnecessary grounds of discontent.

There were many other general heads of Irish Government touched upon in the course of the conversation, which I do not now remember. He spoke to the reports about the situation of English Government. I never heard any man, in the whole course of my life, affirm any one thing more distinctly, positively, and unequivocally, than he did, when he told me that Government were upon a sure foundation here. He said that I was too wise to expect him to explain to me upon what grounds he said this, but that it was upon sure grounds; that there was a moral certainty, and as a rational man he proceeded upon it. This language is the more extraordinary, because the opinion of the world in general, I might say of almost every man in London, is directly the reverse. Either, therefore, Lord Shelburne is (not a dissembler, but) the most abandoned and direct liar upon the face of the earth, or he is deceived himself, too grossly to be imagined, or the whole world besides is deceived. Which of these is the case, time will show, and that only; but I cannot bring myself to imagine that the first is. That he wishes you should believe him secure, I can easily imagine, and that he wishes it very strongly; but that he should therefore be induced to pledge himself to so direct a falsehood, which he must know it was my business to repeat to you, and yours to act upon, and which the event of a few weeks must demonstrate to be false if it is so, exceeds my utmost power of belief. That the Duke of Richmond thinks as Lord Shelburne has expressed himself to me, is, I apprehend, most probable, from the very strong compliments he paid him and the flattering language he held to him in the House of Lords on Friday. But this is mere conjecture. What is certain, on the other hand, is that the explanation given by him in the House of Lords of the American treaty does not tally with that of Pitt, Townshend and Conway in the House of Commons, to which nevertheless the three last have positively pledged their faith and honour, that the Cabinet has been postponed because Lord Shelburne was afraid to meet them, and that the report of the day is that Lord Shelburne was outvoted there upon the question of Gibraltar.

After we had gone over a great deal of conversation on these subjects for above an hour and a half, he said that we seemed to agree about all the points on which we had touched. I then mentioned the two main objects—the Dissolution, and the Bill of Satisfaction. To the dissolution, he said he imagined no difficulty would be made to-day in the Cabinet which was to be held; as to the other point, he saw much more objection. It cut up the principle on which our stand had been made. People were not ripe in England to go into the whole question again. The moment a bill of that sort was proposed in the House of Commons, every man would have to give his opinion on the effect of the repeal, on the legal question, and on the right of internal and external legislation. There never was a debate on Irish questions in England that was not misrepresented; and this, together with the acknowledgment of the principle of the insufficiency of what was done last year, would put Mr. Flood on excellent ground. To many of these objections I could not but subscribe, for they strike me very strongly. I wished to know from him his idea on the external legislation. He said he had understood you, when you left England, that you was determined never to cede that. I said, that as his Lordship referred to conversations to which I was no party, I could only say that I had understood you very differently. The distinction between external and internal, he said, was a bad one, as applied to Ireland. It was applied by Fox, who took it from Lord Chatham, by whom it had been adopted, for want of a better expression, in the case of America. I said, the distinction I made was a clear one—that England could, in her own ports, restrain as she pleased the commerce of Ireland; but that it was not in the power of Government, after what had been done (whether wisely or not), to enforce any English Act which was to be executed in Ireland. He said, that this brought us back to the idea of a settlement; and that he should be curious, and indeed it was necessary to the subject, to know what questions about English Acts concerning trade, and what other commercial points would come into discussion in such a settlement. At the same time, he said, the subject was one of those which required conversing with people of information, and which, nevertheless, if any one was consulted upon it, would set the heads of every one afloat. However, he wished I would turn my thoughts to it, and let him see the principal points. I then pressed him again upon the head of your Bill; I thought it right to say that I was satisfied on every other head, but that this pressed strongly on my mind. All I wished was, that he would allow me to state to you the difficulties, such as he had mentioned them; but at the same time, to say, that they were overbalanced by an absolute necessity. He said, that he would not suppose that they could be overbalanced.

While I write this, I receive your despatches of the 12th instant. I have immediately enclosed your letter to Townshend, with one from myself, of which I send you a copy, and wait his answer with impatience. I was going on, when I was interrupted by your letters, to state to you, that my conversation with Lord Shelburne closed with his saying that the difficulties were capital, and that he could not believe that they could be overbalanced. I then observed, that a Cabinet was, I understood, to be held to-day. He said yes, and at eleven, and that it was then half-past ten, and therefore I must excuse him. As I had been there above an hour and a half, I could not with any propriety stay any longer.

According to Townshend's directions to me last night, I staid at home the whole morning, under the idea that I was to be sent for, as it was so directed in the King's approbation for the Cabinet being held, which Townshend showed me. Why this was not done, whether the Cabinet has not been held, or whether Lord Shelburne thought he had received information enough for all, I cannot pretend to say. It is certainly unnecessary for me to observe, that the whole of this magnificent idea about a settlement was most probably intended to draw your attention off from the Bill you have proposed. I could do no otherwise than acquiesce in sending it over to you, as I had already stated my belief, confirmed so fully by your authority, that your proposal was necessary, and to the adoption of it, on this ground, I meant, if I could, to have pledged him by my last question; and although he did not accede to what I then asked, yet I think I should not have been justified in not agreeing to state to you his objections—which certainly have their weight, especially as he proposed an expedient in the room of yours, though insufficient and improper for the reasons which, as I told you above, I mentioned to him. I forgot to state in its proper place that I reminded him of the danger which was almost inevitable, that some enemy to Government would take the business up, if not immediately done by Ministry themselves.

Half-past Eleven, P.M.