PRAGUE.
The aim of Lord Derby’s Government had been to withdraw England entirely from foreign politics, but that did not prevent Englishmen from rejoicing at the creation of a strong progressive German Power in Central Europe capable of curbing the restless ambition of France, and at the defeat of Austria—one of the strongholds of decaying feudalism. During 1867 the work of consolidating North Germany went on rapidly, and Baron Beust, the Saxon Minister, was called to carry out the new policy of reconstruction in Austria. At last the independence of Hungary was recognised, and the Austrian Emperor having sworn to maintain the Hungarian Constitution, he was crowned in Pesth as King of this ancient Monarchy. When Hungary had been conciliated, Baron Beust next proceeded to frame a constitution for the other provinces of the Empire. One little cloud, however, arose on the untroubled horizon of the English Foreign Office. A pending dispute as to the occupation of Luxembourg tempted Lord Stanley to interfere in Continental affairs during the spring. The King of Holland was Grand Duke of Luxembourg, and he had entered into a secret agreement to sell it to France. But the capital of the province was held by a Prussian garrison, and the new North German Parliament objected strongly to permit a German province to pass under French dominion. France, on the other hand, demanded the evacuation of Luxembourg, and on the 23rd of April, 1867, Lord Stanley wrote to inform Lord Malmesbury that war was imminent. The Luxembourg Question arose simply because the French Emperor had been outwitted by Bismarck’s diplomacy. The claim of France for a cession of German frontier had been postponed till after the peace with Austria was signed. By giving the South German States easy and generous terms, Bismarck had induced them to sign secret Treaties with Prussia, putting their armies at her disposal should France make war on her. Hence, when M. Benedetti presented the French claim for compensation in 1866, Bismarck defied his threats, and as France had neither allies in Germany nor breechloaders in her arsenals, she had to submit. But in 1867 Napoleon imagined he had discovered in Luxembourg a door into Germany that could be forced by diplomacy, and hence the negotiations with the King of Holland, which had been rendered abortive by the resistance of Prussia. The French ambassador in London then appealed to Lord Stanley to use his good offices as mediator, his proposal being that France would cease to press for the purchase of Luxembourg if Prussia would evacuate the garrison, which barred one of the military routes from France into Germany. England advised Prussia to give way. Russia proposed a Conference of the Powers to settle the question, a proposal which Prussia accepted, and the more especially as she doubted whether the dissolution of the Bund which authorised her occupation of Luxembourg had not destroyed her claim to maintain her garrison there. She had also failed to induce Austria to enter into an alliance with her, and so she was open to consider a compromise. Prussia withdrew from the fortress on condition of its being dismantled and the territory “neutralised,” and the European guarantee for the neutralisation of Luxembourg was supposed to be a sufficient compensation for the loss of the fortress. This arrangement was formulated in the Treaty signed at London on the 11th of May, 1867, and at the time it enhanced the prestige of the Tory Government, to whose diplomacy it was greatly due. But, as a matter of fact, it simply served to embitter the relation of the disputing Powers. It left Prussia angry because France had ousted her from the fortress. It left France angry because Prussia had thwarted her attempt to take the territory. Altogether, the Foreign Policy of France in 1867 was strangely bungled. Napoleon, by forbidding the King of Italy to “protect” the Pope against Garibaldian bands, had humiliated a grateful ally. French troops crushed the Garibaldians at Mentana, and thereby deeply wounded the susceptibilities of the Italian people. Worst of all, the Mexican tragedy utterly discredited the French Government in the eyes of Europe. For when France withdrew her troops from Mexico, under pressure from the United States, the Emperor Maximilian elected to remain in the country. His cause soon became hopeless. The Empress Charlotte undertook a fruitless journey to Europe to beg for succour, which was denied her. Her husband was finally taken prisoner by the Mexican Republicans, and shot by order of a court-martial. “There is a very touching account,” writes Lord Malmesbury on the 10th of July, “in to-day’s papers of the Emperor Maximilian’s execution. He died like a Christian and a soldier. His poor wife has become quite insane. The French expedition to Mexico, and its tragical end are a sad blot on Louis Napoleon’s career.”[260]
Though the colony of Victoria was still vexed by the conflict between the two orders of its Legislature, and India was suffering from a famine in one of its Provinces, the dependencies of England in 1867 enjoyed profound tranquillity. One of them, indeed, took a new departure in colonial history. On the 26th of February Lord Carnarvon, carrying out the policy of his predecessor, passed a Bill through the House of Lords, incorporating the scattered provinces of Canada into a Federal Dominion. The financial history of the year, too, was uneventful. Mr. Disraeli introduced his Budget on the 4th of April, just before the Easter recess. In the previous year Mr. Gladstone had determined to use the balance of his surplus for the creation of terminable annuities in order to extinguish debt. The distracted state of affairs abroad, and the difficulties of the Government at home had, however, frustrated the scheme. But it was adopted by Mr. Disraeli in 1867. “He converted £6,000,000 of stock,” says Mr. A. J. Wilson, “costing £180,000 per annum in interest, into an annuity of £440,000, expiring in April, 1885. Of the gross estimated surplus of £1,200,000 he proposed to keep £250,000 against contingencies; and the resolution was wise, for, owing to the Abyssinian War, and to the increase in the general costliness of the public services, the year ended with a considerable deficit. Mr. Disraeli estimated his revenue at £69,340,000, and the actual income was £69,600,000. But the expenditure, instead of being only £68,134,000, as estimated, reached £71,759,000. Deducting £2,000,000 charged that year to the war, the ordinary expenditure still exceeded the estimate by fully a million and a half, about £700,000 of which was due to the increased cost of civil administration.”[261] Hence the
LAST MOMENTS OF THE EMPEROR MAXIMILIAN.
(After the Picture by Jean-Paul Laurens.)
people said that the old ill-luck of the Tories in finance followed them still. The days of plump surpluses had vanished, and those of growing expenditure and dismal deficits had begun. The only remission of taxation which Mr. Disraeli proposed was the reduction of the Marine Insurance Duties. The Budget, in fact was a tribute to those who, like Mr. Mill and Mr. Stanley Jevons, had impressed the public mind that the time had come when sacrifices must be made not to reduce taxes, but to pay off National Debt.