saw the desirability of shipping them all back to the
United States as soon as other troops were available to replace them,
for their lawlessness was bringing discredit on the nation.

In July an expedition was sent up the Laguna de Bay, and the towns on
the south shore were successively captured as far as Calamba, which
was occupied on the 26th of the month. Early in the same month the
inter-island merchant steamer _Saturnus_, on its regular voyage to the
north-west coast of Luzon ports, put in at San Fernando de la Union to
discharge cargo for that place, which was held by the insurgents. The
vessel was flying the American flag. Part of the cargo had been
discharged and preparations were being made to receive freight on
board, when the insurgents seized the vessel, carried off the thousands
of pesos and other property on board, poured petroleum on the woodwork,
and hauled down the American flag. The American gunboat _Pampanga_,
patrolling this coast, seeing there was something irregular, hove to
and endeavoured to get a tow-line over the _Saturnus_, but was beaten
off by the insurgents' fire from shore. The insurgents then brought
field-pieces into action and shelled the _Saturnus_, setting her on
fire. The vessel became a wreck and sank near the beach. Subsequently
a gunboat was sent to San Fernando de la Union to shell the town.

When the wet season had fully set in, operations of importance were
necessarily suspended. Skirmishes and small encounters occurred in
many places where the contending parties chanced to meet, but no
further remarkable military event happened in this year of 1899 until
the north-east monsoon brought a cessation of the deluging rains.

Notwithstanding General Otis's oft-repeated intimation of
"unconditional surrender" as the sole terms of peace, in October
General Aguinaldo sent General Alejandrino from his new seat of
government in Tarlac to General Otis with fresh proposals, but
the letter was returned unopened. At that time Aguinaldo's army
was estimated at 12,000 men. The insurgents had taken many American
prisoners, some of whom were released a few days afterwards, and, in
October, Aguinaldo issued a decree voluntarily granting liberty to all
Americans held captive by his people. This resolution, proclaimed as
an act of grace, was really owing to the scarcity of food, and for the
same reason Aguinaldo simultaneously disbanded a portion of his army.

In the month of December General L