charged. This inducement to prolonged service no longer exists; and in the present flourishing condition of agriculture, industry, and trade any industrious and able-bodied young man can easily obtain much better wages than the pay of a non-commissioned officer. The consequence is that very few soldiers remain in the army any longer than they are compelled to do. Old soldiers and corporals with three or four chevrons are now scarcely ever seen; both soldiers and non-commissioned officers are almost beardless, as in the German army. The period of service being so short, the work of all ranks has considerably increased. The drills are more frequent than they used to be, and the manoeuvring is on a larger scale. The army is kept in constant movement, as in Prussia. The duty in a battalion of chasseurs begins at seven in the morning and lasts till dusk, with a brief interval for dinner; and the result of this continuous work is shown in far greater discipline and steadiness than was to be seen in French troops before 1870. In a few years, when all the contingents raised since 1872 will be liable to serve in case of war, there will be 606 battalions of infantry of the line and chasseurs ready for the field, and 145 regiments of territorial infantry as a reserve. This, supposing it possible to bring the first battalions up to the war strength of 1,000 men, would constitute a total force of upwards of a million. infantry soldiers, not counting the Zouaves, Turcos, and the foreign legion in Algeria. Much of the efficiency of the army, as well as many other benefits, were no doubt due to the direct influence and agency of the Marshal President. Seldom, indeed, has a ruler managed to effect so much real good while at the same time appearing to maintain all the dignified reserve of the constitutional monarch. A retrospect of the short period which has elapsed since the fall of M. Thiers amply substantiates this view. The Marshal was called in when M. Thiers had laid down his office, and when there were many who would have welcomed any decided measures that the new President had chosen to resort to as so many proofs that France was not to be abandoned to anarchy. The plan of leaving events to take their course, of accepting the dictates of the Assembly, of recognizing the right and obligation of the country to govern itself, had been tried under M. Thiers, and in the opinion of many Frenchmen who were neither dishonest nor incapable that plan had failed. If the Marshal had accepted their unexpressed invitation he would have encountered no effective resistance, and he would probably have been supported by some of those whose opinions he was most accustomed to respect. The Marshal's choice was at once made, and it was soon apparent to France that the change of President was a change of persons, not of institutions. The Republic was maintained and administered by the very politicians who had forced M. Thiers to resign because he had determined to maintain and administer the Republic. Throughout the monarchical intrigues of the following autumn Marshal MacMahon never deviated but once from the attitude of deference to the

recovery of the country from its sufferings. The idea was welcomed on all sides, and in this year it assumed a tangible form. It was to be held in the year 1878, and after much dispute the site of the Champ de Mars, together with the adjacent Trocadéro, was selected. A large subsidy for the expenses of erection was voted, and doubtless no exertion will be wanting to make the Exhibition worthy of the city and of the nation. One unpleasant incident tended to mar the general harmony. Upon invitations being issued to other countries to contribute specimens of art and manufacture the German Ambassador, after some hesitation, was instructed to inform the Duc Decazes that his countrymen would be unable to be represented. It is understood that the numerous insults and annoyances to which, unfortunately, German residents in France are still exposed, and the impossibility of affording any effectual guarantee against their recurrence, necessitated the step. Possibly, however, the German Government may see their way in the course of the year 1877 to another course.

A very satisfactory report as to the condition of Algeria was presented this year by General Chanzy, the Governor. It had the advantage of containing some useful suggestions as to its future administration, as well as information about its present condition. General Chanzy deprecated the continual changes in the administrative régime of the colony, as being calculated to retard its development and create confusion. He held that the aim of the Government should be to extend as much as possible the civil territory and increase the number of communes possessed of complete municipal privileges, which, he said, were already more numerous than those in which prevailed the mixed system, as the compromise between full municipal rule and the paternal administration of the native communes is termed. He stated that within the last year the civil territory had been increased by more than a million acres and nearly 80,000 inhabitants at the expense of the military territory. At present the civil territory comprised eleven and a half million acres, with 1,132,000 inhabitants, of whom 252,852 were Europeans, 32,718 native Israelites who had been naturalized French, and the remainder Arabs or Kabyles. He wished to see the area extended still further, as he considered that the object which the Government should keep steadily in view was the eventual transformation of the entire colony into a civil territory. The whole of the territory is not, however, subject to the same régime, for the distinction between the communes in possession of full municipal privileges and those regulated by the mixed system, as explained above, is a marked one. The former, numbering 166, have an area of 3,600,000 acres, with a population of 555,807, of whom 127,321 are French, 32,660 naturalized Jews, 113,018 Europeans of other nations, and 282,808 Mahommedans. These communes occupy a third of the civil territory, and possess half the population. The communes under the mixed system number sixty-three, of which forty-five are in civil and

eighteen in military territory. The former have an extent of 7,400,000 acres and a population of 576,607 inhabitants, of whom 9,888 are Frenchmen or naturalized Jews, 1,683 Europeans of other nations, and the remainder natives. The eighteen mixed communes of the military territory have an area of 16,000,000, with a population of 138,689, of whom 4,660 are Frenchmen or naturalized Jews, 1,073 Europeans of other nations, and the rest natives. General Chanzy stated in his report that it is to the colonization of these mixed communes, which, as the figures quoted above show, are at present so sparsely populated, that his efforts were tending. But, as a writer in the Journal des Débats pointed out, the situation in Algeria is a very complicated one, for, while it is deemed impossible to confer full municipal privileges upon a commune in which a few Frenchmen are lost amidst a host of natives, Frenchmen or other Europeans will not settle in a commune where they do not enjoy local liberties.

General Chanzy further noted as satisfactory, with regard to the administration of justice, that the French magistracy is gaining more and more the confidence of the natives, as the number of justices of the peace augments in proportion as that of the cadis-of whom there are now only 144 as against 204 two years ago-diminishes. Brigades of gendarmerie are being formed, and, as a sign of progress, it is mentioned that there is a growing demand for notaries. It is of more interest to learn that the Arabs are voluntarily sending their children to the primary schools, and that those who have the means place them in French lycées and higher schools. General Chanzy's report of the agricultural progress of the colony is also satisfactory. The extent of land sown in wheat is increasing every year, and, as against 6,700,000 acres, yielding 16,000,000 tons of grain in 1874, the return for 1875 gave 7,200,000 acres, producing close upon 20,000,000 tons.

CHAPTER II.

GERMANY, AUSTRO-HUNGARY, SPAIN, AND
PORTUGAL.

GERMANY.-The new Bank Law-Opening of the Prussian Diet-The Financial Estimates speech of Herr Camphausen-The Penal Code Amendment Act: speech of Prince Bismarck-Release of Cardinal Ledochowski-Prince Bismarck's plan of Railway transfer: debates in the Diet, and ultimate passing of the Bill— Count Arnim and Pro Nihilo-Visit of the Emperor of Russia to Berlin-The Berlin Note--Professor Reuleaux on German manufactures-The Old Catholic Synod at Bonn-Wagner at Bayreuth-Opening of the German Parliament-Debates on the Press Law-Prince Bismarck's speech on the Eastern Question. AUSTRIA.-Position among the European Powers-Death of Franz Deak-Difficulties between the two Governments-Meeting of the Delegations-Meeting of the Emperors at Reichstadt-Austria and the Eastern Question--Financial questions -The Maros outrage: satisfaction given by the Servian Government.

SPAIN. The end of the Carlist War-Martinez Campos-Victory of Primo de Rivera at Estella-Prince Carlos in France-The meeting of the Cortes: the new Constitution-Debates on the subject of Religious Liberty-The suppression of the Fueros-Señor Salaverria's Budget-Return of the ex-Queen Isabella-Affairs in Cuba.

PORTUGAL.-Emancipation of slaves-Death of the Princess Isabella-Financial crisis at Lisbon: closing of banks--Death of the Duke de Saldanha.

GERMANY.

ON January 1, 1876, the Bank Law, passed on March 14, 1875, came into force. By this law the thirty-two German Joint-Stock Banks which enjoy the privilege of issuing notes were compelled to confine their business to the State in which they are located, unless complying with certain conditions laid down in the same statute. These conditions are that the reserved fund is to be increased to one-fourth of the capital; that cash is to be kept in hand for one-third of the notes circulated; that no bills are to be discounted for longer dates than three months, and no bill whatsoever unless bearing two respectable signatures; that their notes. are to be exchanged for cash in Berlin or Frankfort-on-the-Main; that the notes of other banks circulating in the Empire be taken at the seat of the bank and in branch offices in towns of over 80,000 inhabitants, and that the banks in question resign the right of forcing their notes upon the public Exchequer, and of issuing any notes after January 1, 1891. Banks complying with these terms acquire the right to circulate their notes through the whole German Empire, the amount allotted to each being fixed by law. Should any notes above this amount be issued, a tax of 5 per cent. will be levied upon them. Thirteen banks declared their inability to comply with the law and resigned the right of issuing notes, sixteen others adopting the opposite course and remodelling the issue department in accordance with the requirements of the

statute. Of the two other banks one-the Brunswick Bankrestricts the circulation of its notes to the Duchy of Brunswick, while the last remains to be accounted for. The thirteen banks which have resigned their privilege, formerly having been entitled to issue a total of 22,561,330 marks, this sum is added to the notes of the German National Bank, which are consequently raised to 272,561,000 marks. No bank-notes need be accepted in payment, except by the banks themselves and by the Imperial and State Exchequers; and no notes of private banks may be issued by other banks which have taken them in payment, except at the place of issue.

Simultaneously with the Bank Law the new coinage arrangements came into operation. Under this law the only coins constituting a legal tender are the following:-5, 10, and 20 mark pieces in gold; 20 and 50 pfennig pieces in silver; 1, 2, and 5 mark pieces in silver; and divers small coin in nickel. Temporarily, the 1 and 2 thaler pieces, as also the 1, 2, 5, and 10 groschen pieces, as well as some of the copper coin of the old currency, pass current; but they will be withdrawn from circulation in course of time. By the same law establishing the gold standard, nobody is obliged to accept a sum exceeding 20 marks in silver or a sum exceeding 1 mark in copper or nickel; but the Government recognize the duty of giving gold for any sums not exceeding 200 marks in silver and 50 marks in copper.

The next event of interest in the history of Germany during 1876 was the opening of the Prussian Diet. This took place in the White Hall of the Royal Palace, at Berlin, on January 16. Herr Camphausen, Minister of Finance and Vice-President of the Prussian Ministry, read the Speech from the Throne. It commenced by regretting the pressure weighing upon trade and industry, but expressed confidence that the Prussian people would succeed through their energy in overcoming the difficulties of the situation. The revenue was not so large as set down in the estimates for 1876, but it sufficed to carry on the Administration in the same manner as formerly, to allow larger grants in various departments, and to give further development to the great public works of construction which have been undertaken. The speech announced that the Budget would be immediately submitted to the Diet, as also Bills for settling the jurisdiction of the newlycreated public authorities, altering the regulations for the administration of towns, forming a communal union for the city of Berlin, regulating the question of settlement and legal position of agricultural and forest labourers, completing the laws for the protection of forests, granting a legal sanction to the rules of the General Synod, and regulating the State's right of supervision over the Evangelical Churches. The speech confidently anticipated that the Houses of the Diet would willingly co-operate in assuring to the Evangelical Church an independent organization. It remarked that the preliminary labours connected with the

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