Mr. Hay to Mr. Seward.

No. 15.]

Sir: The three laws which together comprise the financial arrangement with Hungary have received the imperial sanction and entered into effect. The law for the emancipation of the Jews in Hungary has also been approved and promulgated.

Last week the Emperor issued imperial rescripts, by which, while relieving Baron von Beust and Count Audrassy from the positions they [Page 62]have provisionally held during the transition period of last year, he takes occasion to thank them publicly for their arduous and successful labors, which have resulted in the present relations between Hungary and Austria. He also constitutes at the same time an imperial ministry for matters jointly concerning both halves of the realm, by re-appointing Baron von Beust (who still remains chancellor of the empire and minister of the imperial household) minister of foreign affairs; Baron von Becke minister of finance, and Field Marshal John minister of war. Count Audrassy remains minister resident of the Hungarian government.

To-day it is understood that the parliamentary ministry for the government of the lands and provinces represented in the Reichsrath, or Cis-Leithan ministry, as it is more concisely called, has at length been formed by Prince Carlos Auersperg, and the list having been submitted to the Emperor has received his sanction. It embraces Prince Auersperg, president; Count Taaffe, vice-president, national defense and public safety; Dr. Giskra, interior; Dr. Herbst, justice; Dr. Brestl, finance; Dr. Hasner, worship and instruction; Mr. von Plever, commerce; Count Potocki, agriculture; and Dr. Berger, minister without portfolio.

This new ministry is composed of some of the most prominent liberal statesmen and orators in the Austrian Parliament, with a sufficient infusion of the conservative and aristocratic element to defend it against the reproach of being an exclusively democratic government. The frequent recurrence of the title of doctor indicates the preponderance of academic and legal talent. You will see that the important branch of the police has been taken from the department of the interior and added to the bureau of Count Taaffe, doubtless as a conservative concession. As a favor to the Polish province of Galieia, the department of agriculture has been created for the acceptance of Count Potocki, one of their leading representatives.

The formation of the ministry has not been unattended with serious difficulty, and it is understood to-day that several of the members accepted the arduous positions assigned them with the express understanding that thorough and searching reforms should be introduced in several branches of the public service. The expenses of the military organization and the bureau administration must be greatly curtailed, the sphere of educational activity widely extended, and the chains forged by unsystematic legislation must be struck from the struggling commerce of the country, before the nation can hope to realize much practical benefit from their amended constitution.

These laudable ends will now become the object of the labors of the new government. That they will be pursued with skill and energy and honest devotion, the names I have given you are a sufficient pledge. But he would be a rash man who would pretend to predict with any certainty the result of the momentous experiment. For the successful accomplishment of the purposes of that enlightened and patriotic body of constitutional liberals who have thus far proceeded on the work of national reconstruction, it is necessary that the nation shall be allowed to devote itself exclusively for awhile to its internal concerns. War and diplomacy are luxuries in which Austria cannot for the present afford to indulge. Yet these are the only two careers in which for ages the ambition of Austrian nobles has found a reward and their energies a field of exercise. It will be hard for them to see their occupation gone, or to direct their efforts at once into another channel. There is a vague and ill-defined fear of entangling alliances. The officious warning which the French consul general at Belgrade is said to have given to the Servian government, that it should take no measures to compromise the interests [Page 63]of Austria, has not contributed to allay this apprehension. The air of protecting friendship towards this empire which pervaded the recent speech of Mr. Rouher in the French chamber, is regarded by Austrians with whom I have conversed as equally sinister and offensive.

The question of the concordat is still hanging undecided. The House of Lords has not yet acted upon the so-called confessional laws, (relating to civil marriage and public instruction,) and Count Crivelli has gone to Rome, it is said, upon the apparently hopeless errand of obtaining the Papal sanction to au act which can only be regarded at the Vatican as legislative sacrilege. As long as this weighty matter remains in suspense it will be a fruitful source of disquiet and distrust.

Another inherent difficulty, to which I have before alluded, is the inveterate spirit of race, which as yet shows few symptoms of giving way to a harmonious impulse of national union. When, in obedience to a general conviction of the necessity of the case, dualism was granted to Hungary, it was intended as the last concession in that direction. But the success of the long and patient struggle in Hungary has apparently only encouraged the other ethnological divisions of the empire to more clamorous demands. The most serious agitation now, in this sense, is that which is universally going on in the C-zech population of Bohemia, which loudly demand the autonomy of the provinces formerly embraced under the crown of St. Wenceslaus, a separate ministry, and the solemn installation of the Emperor at Prague as King of Bohemia. This is attended with what may be termed an “animated flirtation” with the Emperor of Russia, some of the manifestations of which have been the Panslavic pilgrimage to Moscow, the playing of the Russian anthem in the streets of Prague, and the like. These, however, are mere eccentricities of party. I do not think the more influential and intelligent leaders of the movement have any serious intention of inviting the intervention of a foreign power.

I need not speak of the chronic deficit of the treasury as the first and most palpable lion in the path. These difficulties are fully recognized by the liberal majority, and while they disclaim responsibility for them as legacies which have descended from former aristocratic administrations, they announce their purpose to deal with them as promptly and effectually as possible. Many of the leading conservatives confidently anticipate an early failure of the liberal government, and the accession to power of the reaction. If this be so, it will be only one more instance of the disregard which history sometimes pays to the common law maxim, that no one shall take advantage of his own tort. And in the long run I suppose no one ever does.

I am, sir, very respectfully, your obedient servant,

JOHN HAY.

Hon. William H. Seward, Secretary of State, Washington, D. C.