This journal then gives an exposition of the public debt of Texas, which corresponds with the statements made in pages 346-7, and then proceeds to say

"In some documents which have been drawn up, the Texan population was declared to be two millions of souls. The president in the message already cited, says, 'Five years ago, the population was scarcely 40,000 souls, but since that time it has quadrupled.' That is to say, six months ago, the Texans, Indians, and slaves amounted to 160,000 souls! It is, then, upon this population that the weight of the enormous debt will rest; namely, in principal, at the rate of 39 dollars per head; and interest at the rate of 60/0 (2 dollars, 35 cents) per head on women, children, old men, and slaves.

"With respect to the project of establishing living walls of French cultivators between the Texans and the Indians (Comanches), we have that which the English have not. In the month of January last, a company was formed in London, under the patronage of General Hamilton, for the cultivation of lands in Texas. M. Henry Prater was the secretary. They have not succeeded since they came to us.

"Looking at the moral guarantee of the debt, who would rely on the fidelity of the Texans to fulfil their obligations? Ought we to adopt, as an example of their fidelity, their rebellious conduct towards Mexico? or the punctuality with which they have discharged the interest upon their debts-interest which we have shown has never been paid? or still more, in the offer made to France of 'exclusive privileges,' bound as they are by a treaty with Great Britain, who will assuredly not suffer the slightest infraction of her conditions?

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Among the arguments offered in favour of the Texan loan, there is one which, in this money age, can scarcely be dwelt upon without blushing; we allude to the immoral and anti-social policy of allowing the French cultivators to smuggle prohibited

But

goods to the frontiers of Mexico and the United States. this shameful traffic, since it has been conceived, cannot, we say, be carried on. The enormous expenses, moreover, that would be incurred by the transport of merchandise from the Texan side beyond the frontiers, to say nothing of the danger from the proximity of the Indians-how is it that the Texans have not reflected that the difficulty would be, not in conveying merchandise to the coast, but in transporting it to Mexico or the United States under the eyes of a vigilant customs? And how can we believe that the United States would suffer, on their frontiers, the existence of a republic of smugglers?

"In fine, if it should turn out that General Hamilton should accomplish his object, and effect a loan, who would believe that the money would be employed in developing the resources of Texas? We here again return to the message of the President delivered in January last—a message which announces that 'Mexico is making preparations to reconquer Texas'-a fact confirmed by the Mexican envoy here, and recently inserted in the Paris journals. Is it not, we ask, for the purpose of defending themselves against this threatened attack that the Texans require the loan they are desirous of obtaining from the French capitalists? And even if this menace should not be carried into effect, ought not Texas to pay for the naval armament she has purchased, discharge her public debt, or at least the arrears of interest, before she applies a single franc to the cultivation of the soil thus menaced?

"In vain do they tell us that this loan project is abandoned. It is a new snare to catch the credulous. Every thing is secretly prepared. Notifications, expostulations, coupons, actions, &c., &c. all are ready to dazzle with the usual noise. But we hope we have succeeded in putting public credulity on its guard against the sinister and mystified efforts thus incessantly employed to entrap the unsuspecting."

This exposé not only thwarted General Hamilton's schemes by opening the eyes of the French

people, but it also led the French press generally to take up the subject, and on the 14th June, 1841, the subjoined article appeared in La Presse :—

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"THE TEXAN LOAN.

THE COMMERCIAL BANK OF LAFITTE AND COMPANY.

"The project of a loan on the part of the republic of Texas, at first publicly announced under the auspices of M. Lafitte, then withdrawn after the declaration made by the French government in its official lists, appears to be definitively and irrevocably abandoned. It is, however, not so; and the bait is presented anew to the cupidity of stock-jobbers, and the ignorance of annuitants, with a charlatanism unparalleled.

"The question of national interest is the first point in which we ought to regard this unjustifiable attempt. What! Is it at a moment, when our finances are deeply encumbered-the very day after the Government and the Chambers have refused to apportion a sum for iron railroads, in the fear that the issue of vouchers with interest at 4 per cent., would create a competition in state securities-when the minister of finance is calling upon the French capitalists to supply our deficits and secure our services—is it at such a moment, we say, that Paris is to be inundated with an issue of thirty-seven millions to benefit a foreign republic? And the banker who has the temerity to give the sanction of his name to this anti-national scheme, is M. Lafitte ! M. Lafitte, who, after having succeeded in acquiring a long and prodigious popularity, would now make it appear that he is no longer proof against former delusions, the last glimmerings of which were extinguished at the bottom of the quarry of the Plasterer's Society and in the mines of Chaney Saint Stephen.

"But we turn from this part of the subject, on which the public cannot be too sufficiently edified, and address ourselves to a rigid examination of the Texan loan, a dry inquiry, but nevertheless an useful one in a moral sense, and more especially useful

for the evil that may be averted by the exposition. What is the destination of the loan? What are its conditions? What the guarantees? What is M. Lafitte's position in the speculation? Is the affair profitable to the borrower and the lender; or on the contrary, is it disastrous to both, and excellent only for M. Lafitte?

"The loan, says the prospectus, is destined to the extinction of the old debts of Texas, which are represented by the bonds issued during the war with Mexico, and by a debt contracted with the United States bank. In consequence of these dispositions the liquidation of the Mexican debt ought, in reality, to turn to the advantage of the English, who hold the securities. This is a result that ought necessarily to follow the act of mediation of the 14th of November, 1840, between Mexico and Texas, interposed at the instance of the British government. This act stipulates, in effect, that if the republic of Texas shall obtain, through the mediation of her Britannic Majesty, an armistice and a treaty of peace with Mexico, she will consent to charge herself with one million sterling (25,000,000 francs) of the foreign debt contracted by the republic of Mexico.'

"The destination of the money demanded by M. Lafitte of the French capitalists is thus fixed by the document just cited, the result of which is, that the loan to be raised in Paris will be turned to the benefit of our excellent allies the English.

"The loan is to be divided into 37,000 bonds of 1000 francs each, thus representing a nominal debt of 37,000,000 francs. These bonds are to be divisible into 37 series, redeemable at par, by an annual withdrawing of at least 1000 bonds. The capital advanced for each bond is to be only 750 francs in exchange for title to 1000 francs. The annual interest is to be 6 per cent. on the nominal amount of the bond. Of the produce of the negotiation, 50 per cent. only of the nominal capital (500 francs per bond) will be lodged with the Texan government, a deduction to be made of 6 per cent for the first year's interest. The 25 per cent. of the surplus will be reserved as an account current by M. Lafitte, to be placed at the disposal of the Texan government

after the liquidation, in capital and interest, of one-fourth part of the loan.

"The mechanism of these combinations surpasses every thing that could be conceived by the most cunning usurer in a private transaction, as the following calculations will demonstrate :

"The republic of Texas delivers 37,000 bonds of 1000 francs, representing a capital of 37,000,000 francs; but on each bond 750 francs only are to be advanced by the subscriber. Here, in the onset, is a loss of 25 per cent. to the borrower on a sum of 9,250,000 francs. Such is Combination the first!

"The interest stipulated at 6 per cent. to save appearances, is due, and ought to be paid on the nominal sum and not on the amount advanced. The fictitious rate of 6 per cent. is thus in reality placed by that of 8 per cent. Combination the

second!

"Of the sum of 750 francs advanced by the subscriber, 250 francs are to be remitted to the borrower at a very remote period, probably not less than nine years. Here is then a second sum of 9,250,000 francs, which will not reach the Texan republic. This sum of nine millions two hundred and fifty thousand francs is to remain, for at least nine years, in the hands of M. Lafitte. Combination the third !

"Of these 9,250,000 francs not at the disposal of the Texan republic, she pays to the subscribers six per cent. interest, while M. Lafitte, in his account on this deposit, allows FOUR per cent. The borrower thus loses a difference of interest of two per cent.* for at least nine years on this enormous capital, which he is pre

*This combination' reminds me of one of the many instances of success that attended the late Mr. Rothschild's financial operations. In contracting the Brazil loan of two millions, Mr. R. made net £89,000, viz. two per cent. commission, £40,000, and the first half-year's dividend, £59,000; the contract having been made in January, 1825, with interest from the 1st of October preceding, whereas he issued it with interest from the 1st of April, 1825!-N. D. m.