which he would
accept, and restore the Milanese. The surrender of the Netherlands was
refused, and on December 19 Malmesbury was ordered to leave Paris in
twenty-four hours. This abrupt termination was connected with the death
of Catherine of Russia on November 17, soon after she had agreed to
support Austria with an army of 60,000 men to be paid by England. Her
half-crazy son and successor, Paul, declared himself neutral. On the
part of the directory, however, the negotiations were illusory,
undertaken merely to appease domestic discontent. The French declared
that England's offers were insincere. Fox and his party adopted the same
line, and their attacks on the government left them with thirty-seven
supporters in the commons and eight in the lords.

This ineffectual negotiation roughly coincides with the beginning of an
awful period of stress and depression. The directory designed to isolate
England, reduce her to bankruptcy by destroying her commerce, and
complete her ruin by invasion. Already Austria, her one efficient ally,
was nearly exhausted; her commerce was shut out from the Mediterranean,
and, though vigorously pushed in other quarters, was constantly
harassed, and a plan of invasion was ripe for prosecution. Pitt met the
prospect of invasion by proposals for increasing the army and navy by
parochial levies, and for the formation of militia reserves and
irregular cavalry. Fox asserted that the French did not contemplate an
invasion, and that the immediate duty of parliament was to guard the
freedom of the people against its domestic enemies, the ministers. This
disgraceful speech roused the indignation of the peace-loving
Wilberforce, who declared that Fox and his friends seemed to wish that
just so much evil should befall their country as would bring them into
office. Though the government easily carried its proposals for defence,
it was embarrassed by financial difficulties. Pitt had granted an
advance of L1,200,000 to the emperor without the consent of parliament.
He was justly blamed for this unconstitutional act, and eighty-one
members voted against the government. In his budget of December 7 he
proposed another loan of L18,000,000. The public debt already exceeded
L400,000,000; the 3 per cents. had fallen with its growth, and in
September were at 53. In the dangerous position of the country,
financiers would have declined the loan, and Pitt offered it to the
public at 5 per cent. and L112 10s. stock for