May 31, Tuesday. No special matters in Cabinet. Mr. Seward sent me on Saturday a correspondence between himself and Lord Lyons and the Treasury Department relative to a large amount of cotton which was purchased a few months since in Georgia by one John Mulholland, an Englishman, who desires to bring it out, or, if he could not do that, to have it protected. The Secretary of State wrote the Secretary of the Treasury for views. The Treasury thought the proposition to bring it out inadmissible, but when our military lines were so extended as to include this cotton the agents of the Treasury would give it the same care as the property of loyal citizens; thinks it would be well to advise the Navy and War Departments to instruct their officers. Hence the communication to me.
I decline giving any such instructions, and so have written Mr. Seward, considering it illegal as well as inexpedient, telling him it would be a precedent for transferring all the products of the South into foreign hands to pay for munitions of war which we should be bound to protect. None but Englishmen would have the presumption to make such a request. It is entitled to no respect or consideration. Not unlikely it is cotton of the Rebel government covered up.
