No. 564.
Mr. Cushing to Mr. Fish.

No. 47.]

Sir: Since the transmission of my two dispatches Nos. 34 and 35, of the 18th instant, importants events have occurred here, of which you may not be unwilling to receive information.

1. The military situation:

At that time General Concha was advancing by Lodosa and Sesma for the purpose of attacking Estella and cutting the line of the Carlists, so as to separate Navarre from the Basque Provinces.

On the afternoon of the 27th, (Saturday,) Concha had advanced to as far as Abarzuza, a place to the north of Estella, with portions of his force at Murilla, Lorca, Villatuerta, Oteiza, and other points, in a semicircle, on the northeast, east, and southeast of Estella.

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Meanwhile other troops had been advancing from Pamplona and from Tafalla, under command of Generals Eschagüe and Martinez Campos, to unite with General Concha on the eastern side of Estella.

All these points, together with the lines of movement before and after that day, will be perceived upon inspection of the map of the theater of war herewith inclosed.

After engagement with artillery, occupying most of the day of the 27th, a column of attack was ordered to assail the enemy’s trenches at a point between Murilio and Estelia, called Monte Muru, which is not designated on the map.

No details of what then happened are yet made public here; but the subsequent incidents show that the attacking battalions must have been repulsed with great loss relatively to their numbers.

Thereupon a supporting column was ordered up to continue the attack, but the troops refused or hesitated to advance as ordered. On this General Concha rode to the front to address and exhort the troops, and, in the act of doing this, received a musket shot in or near the breast, which produced immediate death.

As to what immediately folio wed, all we know with certainty is, that the troops of the government then retired in order, it would seem, and carrying with them their train, and retreating upon Orteiza, pursued to that point by the Carlists; and at the present moment they are posted at Larraga, Berbinzana, Miranda de Arga, Olite, and Tafalla, the bulk of the army being now, it is said, at Tafalla.

General Concha’s body was conveyed as soon as possible to Tafalla, from which information came to Madrid by telegraph early on the afternoon of the 28th, (Sunday.)

A meeting of the cabinet was immediately called at the ministry of war, and President Serrano, who had gone to La Granja the day before, was summoned back to Madrid, where he arrived in the course of the evening; and it was arranged that the minister of war himself, Captain-General Zavala, should take the place of General Concha in command as general-in-chief of the forces in the field, General Cotoner being appoinied ad interim minister of war.

The death of General Concha has produced extraordinary emotion in Madrid, with universal expressions of sorrow and respect here and in other parts of Spain. It seems to be admitted on all hands that he was the ablest among the veteran generals of Spain. He was poor, having no resources but his pay. He leaves one child, a daughter, the wife of the Marqués de Sardoal, at present chief alcalde of Madrid.

Yesterday and to-day every disposable soldier has been hurried off to the seat of war, including many superior officers, and among the rest General Moriones, who acquired reputation in a previous, though unsuccessful, campaign against the Carlists in the same region of country.

It does not appear that the losses sustained by the troops of the government were absolutely large, not exceeding, perhaps, fifteen’hundred men in killed and wounded; but the repulse, the retreat, and the death of General Concha, have contributed to produce a deep impression at Madrid.

Intense indignation toward the Carlists is felt here on account of a recent proclamation issued by the commander-in-chief of the Carlist forces, Dorregaray, in response of expressed purpose of General Concha to waste the country, and in which Dorregaray announces intention hereafter to give no quarter; in the spirit of which declaration it is said that he caused to be killed such of the wouuded as were left behind by the retreat of the forces of the government.

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2. As to the political situation:

The minister of hacienda, Mr. Camacho, has been occupied ever since his appointment in examination of the state of the public finances and in devising ways and means for the service of the government. The result of his labors appears in an official report and in various decrees published in the “Gaceta” of the 28th. Exhibiting, as Mr. Gamacho’s report does, continual diminution of revenue and continual increase of expenditure, it was unfortunate that it should appear on the morning of the day when knowledge arrived of the death of General Concha for, although Mr. Camacho has but obeyed the dictates of duty in stating frankly the condition of the finances and in suggesting the necessary measure of imposition of new taxes, still the information given by him, and the remedies proposed, necessarily serve to augment the public discouragement, and to occasion a fall of the funds to the lowest point they have yet reached, more especially in view of the loud complaints of the English company who control the Spanish foreign debt, and who consider one of the measures proposed by Mr. Camacho as a violation of a contract heretofore made, not long ago, by the Spanish government for securing the payment of overdue coupons by means of certain securities held by or belonging to the government.

This last matter seems likely to be taken up by the British government in behalf of the bondholders; and, whether it be so or not, it cannot fail to be highly prejudicial to the credit of the Spanish government in England.

I have, &c,