[Extracts.—Confidential.]

Mr. Seward to Mr. Adams.

No. 322.]

Sir: Your despatch of July 31 (No. 197) has been received.

I remark, with reference to the reports circulated by American traitors in London that the Emperor of the French proposes to recognize the insurgents without waiting for any new combinations, that there is nothing to confirm these reports in any communication, official or unofficial, which has been received by us from Paris. We learn from that capital that there, as in England, sentiments unfavorable to our cause and our country seem to be gaining more general favor under the inculcations of a hostile press.

In all his communications with this government the Emperor of the French has preserved a tone that was frank, friendly, and respectful, letting us understand, however, that a strong pressure upon the government was made by classes which attributed their sufferings to a deficiency of a supply of cotton. The statement by disunionists that the Emperor has directed Mr. Slidell to instruct Mr. Mason to make another formal appeal to Earl Russell preliminary to his own separate and exclusive action seems improbable. Could the cupidity of British merchants resist the temptation to keep peace with us if France should go to war alone? Could France propose to go to war with us without Great Britain as an ally? Is France more ready for hazards of war than Great Britain ?

While we are making ourselves ready, as far as possible, for whatever emergency may happen in our foreign relations, and while we sensibly feel that the present apparent condition of suspended activity in our military operations tends to encourage hostile machinations abroad, we nevertheless rely with much confidence on other circumstances for a continuance of peace and forbearance

First. All the world knows that we shall not entertain any foreign mediation in our domestic affairs; this decision was made known at an early period, and if we have not repeated it with emphasis, it has been because [Page 174] such repetitions would seem disrespectful to foreign powers, and would be inconsistent with the proper dignity of this government.

Secondly. We are supplying Europe with grain and gold, and even cotton, to the best of our. ability, and no one can safely predict that equal supplies could be obtained here or elsewhere if the maritime powers should wage or provoke a war with this government.

Thirdly. Our preparations for continuing the war are vigorous and successful On the 15th of this month we shall have enlisted and coming into the field three hundred thousand new volunteers for the war, and within forty days thereafter this force will be followed by three hundred thousand militia, who will be organized as volunteers and will be not less effective.

The construction of iron-clad ships is going on, on a scale and with a vigor that promises as complete a naval defence as any other nation possesses.

* * * *

When I have told you of our large preparations, I have told you all that is important to be known, except that General Halleck evinces great skill, activity, and grasp, in reorganizing our forces for renewing military operations. Richmond is at this moment the centre of our anxieties. Our plans for operations against it are not so settled and decisive as to allow me to communicate them, for the reason that they may be modified by discoveries of the plans of the insurgents. General Pope had on Saturday, the 9th, a successful engagement with a portion of the insurgent army. There is every reason to expect important military occurrences, and, perhaps, a development of the plan for a new campaign before the departure of the next steamer.

All that can be said now is, that the popular spirit is sound, and we expect that the tone of public confidence will be highly improved as the new levies, now moving from their homes, reach and join and re-enforce the apparently sedentary forces in their camps.

I am, sir, your obedient servant,

WILLIAM H. SEWARD.

Charles Francis Adams, Esq., &c., &c., &c.