Since the date of my letter by Mr Skipwith1 I have become acquainted with some circumstances which have a near relation to the subject of that letter, and which may tend to illustrate the course to be taken in our business with Spain. They are as follows: soon after Mister Monro left Madrid a detailed account of his late negotiation with the Spanish government was transmitted by Mister Cevallos to Richlan where the Emperor then was. A digest was immediately made of it and presented to the Emperor who after having read it attentively remarked that he had nothing to do with it and that Spain must settle her own business. This determination on the part of the Emperor was not altogether acceptable to his Minister and on their retur[n] to Paris the lat[t]er told a person of the utmost respectab[il]ity that means must be employed to alter it. A chief of a bureau accordingly prepared a paper with the view of producing this effect, the heads and substance of which have been thus presented.

1st. The right of the U. S. to redress herself

2d. Her means of doing it.

3d The consequences to Spain of this policy.

4th. The means of Spain to obviate these consequences

& 5th. What, under these circumstances, ought to be the Policy of France?

In examining these points—the right and the means of the U. S. to redress herself were both admitted, but with these qualifications, that the right did not go beyond a reasonable compensation for the nonpayment of debts acknowledged by Spain to be due to Citizens of the U. S. and that the means were merely incidental to the present state of things in Europe.

Under the 3d head were stated the certain loss of the Floridas and the probable dangers awaiting other of the Spanish colonies provided (as was natural and almost necessary) that the principle of reprisal should run into that of open hostility, and make the U.S. a party to the present war.

Under the 4th head, it was conceded that Spain was in no condition to multiply the number of her enemies, or to pursue any policy which should make new demands upon her present resources either proper, or necessary.

The fi[f]th point was examined with great care and under different views, and the result was that France ought to interpose her good offices promptly and efficiently and that some middle and reasonable terms between what we demanded and what Spain was willing to admit might be suggested: that if Spain refused to accede to these, France would be exonerated from al[l] obligation to take part in her quar[r]el; and that if the refusal came from the U.S. and they should proceed to make reprisals upon Spain, that it then would become a question whether this government should, or should not resort to the means within her power of counteracting this system. These means were then indicated, according to my information, in nearly the following words—“they are of two kinds; one of which is to be found in ourselves; the other, in our Adversary. Of the first I shall say nothing, because it would be useless to number our Legions, or to expatiate on their skill or their courage. Our fleets too are sur[e] to be in a condition to transport and co-operate with them, wherever their service may be required. Of the last I will but suggest—that the maxims of a Government which abhors war, and regards fleets and armies as nuisances or scourges; that the habits of a people who have known nothing at home but peace and prosperity for twenty years; that a public revenue, increasing rapidly and beyond all calculation, but entirely dependent on the present state of things: that towns and harbours, large and affluent but wholly defenceless; that a neutral flag rendering tributary to them one half of all the Nations of Europe; that a Commerce, filling all the parts of the Globe, and spread over every sea, but no where in a state to defend itself against the attacks which may be made upon it; that a mediterranean war, recently terminated but easily rekindled, and with a tenfold effect, form altogether a mass of circumstances, which, if we are to be viewed in the light of enemies, sufficiently indicates the course and the issue of the Contest.”

Whether this memoir was carried to the Emperor or whether it was placed in the portfolio of the minister to be employed or not as contingencies might direct I can not learn, as well from the temper in which it seems to have been written, as from the striking resemblance it bears to the informal propositions communicated in my letter of the 10th  2 which appears to have been the first step in the execution of the plan it offers.

The public papers will have informed you of the sudden irruption of the Austrian Army into Bavaria and a part of Suabia. Their first movements indicated a design of forming a line from Londau to Ingolstadt of which Ulm would have been the central and salient point, but this plan (if it ever was their plan) is abandoned, and we now find them presenting a front to the Rhine, and occupying a chain of posts from the famous passes of the Black forest to the foot of Mount St Gothard, and thence through the Tyrol and along the Adige quite to Venice. These dispositions, together with the appointment of the Archduke to the command of the left of this long but powerful line, look as though Austria intended that Italy, as it has been in a great degree the cause, should also be made the principal theatre of this war.

On the other hand, the Emperor seems determined to defend Italy in the plains of Germany, and the greater part of his force is accordingly drawn to the right bank of the Rhine, where, by its present positions, it forms the segment of a circle, of which Homberg, in Suabia, and Nuryberg in Franconia are the extremes. It is said, and his movements warrant the belief, that leaving Bernadotte, with the armies of Hanover and Batavia and the Bavarian Regiments which have joined his standard, to menace, or assail as the case may require, the rear of the Austrian Army, he will himself turn the sources of the Danube and attack General Mack, at Hockach.3

I annex, to this, a letter from Mr. Talleyrand accompanying a collection of Official papers on the subject of the rupture between this Government and that of Austria;4 and am, with the greatest respect, your most Obedient, and very humble Servant,