the importation of Irish troops at the close of the last reign, and London overawed by the great camp at Hounslow. On the other hand, William, with his eyes fixed abroad, with a profound mistrust of France, and certain knowledge of the rapid approach of another great Continental quarrel, could not bring himself to approve of the breaking up of an army which he had brought to such perfection. The ministry, under his immediate influence, and guided by the farsighted sagacity of Somers, believed, like the King, in the approach of fresh danger, and thoroughly disbelieved in the efficacy of halfdrilled militia to withstand such well-trained troops as Louis had always at his disposal. The national feeling was, however, too strong to be withstood. A resolution was passed that the number of soldiers should be reduced to the same amount as had been kept on foot after the peace of Nimeguen, a resolution which was liberally construed by the Government to mean 10,000. On other points the ministry and the Parliament remained at one. It was in vain that an attack was directed against William's lavish grants of Crown lands, in vain that an accusation of peculation was directed against Montague, it resulted only in a formal declaration on the part of the Commons of the great services of that statesman. Montague's success as a financier had indeed reached its culminating point in this session by the temporary settlement of the question with regard to the Indian trade which had so long excited the commercial The East Indian trade. public in England. It has been incidentally mentioned that the renewal of the charter to the East India Company in 1693 had produced the fall of Lord Caermarthen. The Company, originally consisting chiefly of Whigs and incorporated by royal charter, had, in the hands of Sir Josiah Child, who exerted an almost dictatorial authority in its management, allied itself closely to the Tories. Its monopoly had also become very unpopular, as the increase of capital and the great receipts of the Indian trade had excited a wish among the mercantile community to enter more largely upon that branch of traffic. As early as 1691 an association of its enemies had been formed, which, although it was not chartered, was commonly spoken of as the new Company, and had succeeded in obtaining a request from the Parliament to the King that he would give the old Company the three years' notice of the withdrawal of its charter which was legally required. An accidental illegality had in fact just then invalidated the charter. It was to procure its restoration that, in 1693, Cook, to whom Child had now relinquished much of his authority, had so lavishly expended the secret service money, 1698] FORMATION OF THE EAST INDIA COMPANY 861 some of which had been traced to Caermarthen. His bribery was successful. The charter was renewed by the King, but the Parliament, at the instigation of the new Company, took a different view of the question, and declared that every man had a right to trade, unless debarred by Act of Parliament. This declaration of the limits of the constitutional power of the Crown in matters of trade William could not venture to oppose. From that time onwards, therefore, the trade had been legally free, but the power of the Company had been so great in the Indian seas, and its conduct so oppressive, that it had been impossible for free traders to carry on their business with any success. Again, in 1698, the question was strongly pressed upon the attention of Parliament, and again the old Company found strong supporters in the Tory party, while the Whigs upheld the demands of those who wished to participate in its advantages. There was a division in the views of the opponents of the Company. Some were eager for perfect freedom of trade, while others joined in the general feeling of the nation, that, although the present monopoly was a bad one, some sort of restriction was still necessary. It was understood that to advance money to Government was the surest way to obtain its support, and the old Company offered £700,000, at four per cent., as the price of the renewal of its charter. But Montague, anxious for money to relieve the embarrassments of the Government, anxious to establish a second great Whig society of capitalists, who would support him as the Bank had already done, believed that he saw his way to gaining those ends by opposing the Company, and brought forward a plan by which he hoped to secure the support of both sections of its opponents. He suggested the formation of a company, to be called the General Company, and proposed that a loan of £2,000,000, at eight per cent., should be advanced to Government, and that the subscribers should receive the monopoly of the Indian trade, but be free from the obligation of trading as a joint-stock society, unless they should afterwards wish it. He carried the Bill for its formation through Parliament, and, in spite of the forebodings of his enemies, found that the immense sum which had been promised was readily subscribed in two or three days. The Bill was carried on the 3rd of September, but, on the 5th of the same month, the greater part of the subscribers declared their desire to become a joint-stock company, which was therefore chartered by Act of Parliament by the title of the English Company trading to the East Indies. The struggle between the companies was found to be so destructive to English Formation of the General East India Company. 1698. The two Companies united. 1708. trade, that, in 1702, arrangements for their union were made. A common court of managers was established, their stocks equalized, and trade carried on under the name of the United Company of Merchants trading to the East Indies. But each company still traded with its own separate stock. Many inconveniences still attended this division of interests, and at last, in 1708, upon the award of Lord Godolphin, a final and complete union was made; and, as the separate adventurers who had not joined either company were bought out, the monopoly again fell into the hands of the great United Company. But though his plan was thus ultimately a failure, for the moment Montague had all the credit of another great financial triumph, and the Whig party might reasonably expect that, in spite of the one single defeat with regard to the standing army, their position would be as good in the new Parliament as it had been in that which was just closing. tion directed to the Spanish succession. Meanwhile the King's personal attention had been as usual directed William's atten- rather to foreign than to home politics. The great question which at once occupied the minds of diplomatists after the Peace of Ryswick was the succession to the throne of Spain. It seemed very improbable that Charles II., a miserable hypochondriac, should live much longer. At his death there threatened to be a general scramble for his vast possessions. Early in the year, an embassy of unusual grandeur had attended Portland to France. The question had been there opened, and a corresponding French embassy under Tallard had subsequently and with the same object been sent to London. On the dissolution of Parliament the scene of negotiation was transferred to Holland. The question was one of great intricacy and difficulty. It was not easy 1 Philip III., 1598-1621. Philip IV., 1621-1665. Maria Ferdinand III. Anne-Louis XIII. b. 1606. Emperor, b. 1601. of France, 1637-1657. Charles II., Marie-Louis XIV. (1) Margaret Leopold I.,=(2) Prin cess of Electress of Joseph I., Joseph, Electoral Prince, of Anjou, 1610-1643. Louis XIV. of France, 1643-1715. Charles VI., the Arch- Maria Theresa, 1698] THE SPANISH SUCCESSION 863 to point out the legitimate successor, even had it been possible to allow the Spanish monarchy to pass unbroken into the hands of any of the claimants. The eldest of Charles's sisters had married Louis XIV., a younger sister had married Leopold of Germany. Leopold was himself Charles's first cousin, grandson of Philip III. In direct descent, therefore, the Dauphin stood next to the Spanish king. Next to him came the offspring of Leopold's first marriage with the Spanish Princess, namely, the Electress of Bavaria, but she gave over her right to her son, the Electoral Prince. The third in order was the Emperor Leopold. But the marriage of the Infanta with Louis had been accompanied by a formal renunciation of her rights, sanctioned by the Cortes. The marriage of the second Princess with Leopold had been attended by a similar renunciation, not sanctioned by the Cortes. The marriage of Leopold's mother with the Emperor had been attended by no renunciation at all. Thus, if the renunciations were valid, the claims in accordance with them came in exactly the opposite order to the claims by order of descent. But the change in the balance of Europe involved in the accession to the throne of Spain of a prince of either the imperial house of Germany or the royal house of France was of far graver importance than the mere legal rights to the throne. Both Leopold and the Dauphin, conscious that Europe would not submit to their acquiring Spain for themselves, had handed on their claims to representatives, who might be considered as comparatively harmless. Leopold had substituted for himself the Archduke Charles, his son by a second marriage, the Dauphin his second son Philip. But, in spite of this arrangement, France, England and Holland had considered it dangerous that the Spanish dominions should pass entire into the hands of either of the claimants, and the negotiations of this year were directed to forming a plan for dividing them with some sort of equality among the three. The product of these negotiations was the First Partition Treaty, definitively signed at the Hague on the 11th of October. By this the bulk of the Spanish dominionsSpain, the Indies, and the Netherlands-was to pass to the least powerful of the three claimants, the Electoral Prince. France was to receive Guipuscoa in the north of Spain, and the Two Sicilies; the Austrian competitor was to be satisfied with the Milanese. The treaty had been arranged as quietly as possible, but the republican institutions of Holland were not favourable to secresy. Rumours of what had been done reached Spain. The desire of the King and the Castilians was to preserve at all hazards the integrity of the Empire. First Partition Charles was therefore persuaded to make a will, and to declare that candidate whom France and England seemed most to favour, namely, the Electoral Prince, heir to his whole dominions; and thus for a time the matter rested. New Parliament. Party. Having thus temporarily settled his position abroad, William returned to England with the hope of a peaceful session. The hope was singularly falsified by the event. The great Whig party, so noble and united in adversity, had fallen to pieces, and a Tory reaction begun. The greatness and success of its measures had left room for faction. The unpopularity both of William and Montague afforded opportunity for the attacks of malcontents. On the assembling of Parliament after the new elections (Dec. 6, 1698), it became evident that a large number of unknown men who had been elected, although nominally Whigs, intended to make common cause with the extreme Tories, and that The Country this united faction, under the title of the Country Party, would form an opposition against the Crown. The last session had already marked out the lines this opposition would take. The points at issue would be the maintenance of the army, the distribution of Crown grants, and the conduct of individual members of the ministry. On the first of these points the King did not act wisely. Unable to understand the insular politics in favour with the English, he insisted that the ministry should propose a standing army of 20,000 men. Afraid to introduce a Bill which they knew they could not carry, the ministry suffered the initiative to slip from their grasp, and a private individual was allowed to propose that the number of troops should be further lessened to 7000, and that all those 7000 should be born Englishmen. In spite of the efforts of the Dismissal of the ministry the Bill was carried, and William found himself compelled to order the departure of his favourite Dutch guards. Hurt to the quick, he seriously formed the intention of quitting England. He even drew up his farewell speech, and was only moved to remain by the earnest prayers of Somers and by his own returning wisdom. Dutch guards. Assured of their majority, the Opposition proceeded to attack the late ministry. Their favourite object was Montague, who had laid himself open to their assaults by the pride and luxury which he had exhibited in his good fortune, and still more by the indecent rapacity with which he seized on the valuable place of the Auditorship of the Exchequer, worth at least £4000 a year; this he placed in the hands of his brother, to be held until he should want it. The next victim |