Mr. Thompson to Mr. Gresham.
Petropolis, December 31, 1893. (Received February 3, 1894.)
Sir: Since Admiral Saldanha da Gama assumed command of the insurgent forces in the harbor of Rio de Janeiro there has been no material change in the situation. His control of the islands of Cobras and Enxadas give to the insurgent forces a better position, and the men which were upon them slightly increase their force.
The usual fighting has been carried on daily, but has not resulted yet in any definite gain to either side. The Government forces have gained a few of the islands in the northern and western part of the bay. The islands Governador, Eugenho, Mocangue, and Conceição, have come into their possession. They are apparently endeavoring to surround the insurgents so that they can be reached by artillery in any part of the bay. During the attack on Ilha do Governador, Gen. Telles, one of the oldest, bravest, and most successful officers of the Government, was mortally wounded and has since died. It is also claimed that 300 Government troops were upon this occasion taken prisoners; but, notwithstanding this, the Government is still in possession of it.
Considerable adverse criticism has been caused by the alleged fraudulent issue of a retired currency by the Government, in order to relieve an embarrassment. As far as my inquiry has gone, however, I am of the opinion that the charge is unjust.
The fleet of vessels fitted out in foreign countries have not yet taken an active part in the struggle. The Nictheroy, America, Aurora, and several torpedo boats are in Pernambuco, where it is reported that much difficulty has been encountered with the crews.
The complete control of the Government over all lines of communication with the south makes it impossible to obtain reliable information of the operations in that quarter. Nothing definite has been known of Admiral Mellows whereabouts, nor of his movements since he left on the night of November 30. It is, however, believed that he is at Desterro.
Many rumors are current, but there is nothing confirmed or reliable, I received recently information, which was alleged to have come from Admiral Saldanha, that a large force of insurgents from Rio Grande were approaching the border line of São Paulo and would come to Rio.
Other information, when it was confirmed, I communicated by telegraph, as directed.
I have, etc.,