Highly Important from Vienna

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Vienna, May 14, 1859

The Prussian General Willisen (brother of the other Prussian General of the same name who got some fame by his works on military science, and lost it again by his conduct of the Schleswig-Holstein war) has arrived here, apparently sent from Berlin, to receive .the brainless King of Prussia and his Queen on their return to Prussia. His real business is said to be confined within two points—first, to warn Austria to desist from her intrigues at the Frankfort Diet, since Prussia is not willing to be dictated to by the Vienna Cabinet, under the mask of that grammatical being the German Confederation; secondly, to sweeten the pill thus administered by the positive assurance that Prussia is now definitively resolved upon "armed mediation." The latter ambiguous term is interpreted to this effect: that Prussia, having put her house in order and armed herself to the teeth, will make some new peace proposals to Bonaparte, on the refusal of which she will cast her sword into the balance. Concurrently with this important communication the Austrian Government has received, via Bern, the news that, apart from its secret stipulations not yet known, the Russo-French treaty obliges France to confine the war within the limits corresponding to its professed purpose of liberating Italy, while Russia binds herself on the first actual intervention of the German Confederation in the struggle to march an army of at least 300,000 men over her frontiers.

There is much grumbling here at Gen. Gyulay's old-fashioned strategy, and rumors are set afloat of his dismissal, Gen. Hess being named as his successor. But no such step seems yet to be contemplated, since Col. Kuhn, the most distinguished officer of the Austrian staff, has been sent to support Gyulay's vacillating counsels. Gyulay himself is a Magyar. He was born at Pesth, Sept. 1, 1798. At 16 years of age he entered, as sub-Lieutenant, a regiment of infantry commanded by his father; he was then transferred to the Hussars, was appointed in Sept., 1827, Major of the Kaiser-Uhlanen, soon after Colonel of the 19th Regiment of Infantry, and advanced in 1837 to the dignity of Major-General and Brigadier at St. Pölten. In 1845, he commanded the 33d Regiment of Infantry at Vienna; in 1846, having received the dignity of Field-Marshal Lieutenant, he was sent to Trieste in the capacity of General of Division and Supreme Military Commander. In 1848, he found occasion to do some good service at that place. Placing himself, on his own responsibility, at the head of the navy, he dismissed the suspected Italian officers and sailors, put the men-of-war at the different stations on the Dalmatian coast in security, and saved some men-of-war already on their way to Venice, He ordered the necessary measures of defense at Trieste, Pola, Pirano, and other important points on the coast, secured the frontiers menaced by insurrection, and prepared for the offensive, which was taken in fact by Feldzeugmeister, Count Nugent, on April 17, 1848, after the arrival of reenforcements from the inland provinces. A rowing flotilla, organized by Gyulay, supported the coast operations of the army. On May 23, the Piedmontese fleet appeared before Trieste, but was kept at bay by the preparations he had made; its attempt at surprising the distant battery at St. Barcola, was likewise baffled. The Piedmontese fleet alarmed Trieste for the last time on the 8th of June, but, finding Gyulay well prepared, withdrew from the horizon of the town on the 4th of July, and from the Adriatic Sea after the battle of Custozza. In reward for these services, Gyulay received different orders from the Emperor and the right of citizenship from the magistracy of Trieste. Being intrusted at the beginning of June, 1849, with the Austrian War Ministry, he is said to have displayed great energy and activity. At the occupation of Raab, he formed part of the Emperor's suite. From Vienna, whither he had returned to his office, he hastened, on the news of the defeat at Acs, immediately to Komorn, there to take the necessary measures. Subsequently, he was sent on a tour of inspection through the whole empire, and presented his report to Francis Joseph. After an exchange, in July, 1850, of the War Ministry for the command of the 5th Corps at Milan, he was named Feldzeugmeister, and received the order of the Golden Fleece. After Radetzky's retirement, he got the command of the second army, which he has now led against Piedmont. He is one of the Austrian Generals, mostly Slays or Magyars by birth, that have disgraced themselves by women-flogging and other infamous brutalities.

Two battalions of Vienna volunteers. have already left for the theater of war, and a third battalion is marching off to-day. These volunteers were, at first, the heroes of the day, dressed as they were in the uniforms of the Legionairs of 1848, and belonging to the autochthone gentry of the suburbs. Balls and concerts and theatrical representations for their benefit abounded, and even the Austrian Waltz Orpheus, Mr. Strauss, composed a new march in their honor before his rather unpatriotic departure for Peters-burg. It cannot, however, be denied that latterly the popularity of these newfangled warriors has sunk to a frightful discount. These primitive roughs of the suburbs made somewhat too free with beer and cigars and the better half of mankind, and sometimes rather overstepped the limits of even Vienna "humor." What they are, they tell themselves in their pet song:

"Ich bin ein ächter Wiener, Führ ein lustiges Leben, Und da hat mich mein Vater Zu den Deutschmeistern geben; Deutschmeister ist ein Gar lustiges Regiment, Hält in der einen Hand den Säbel, In der andern das Ziment."

("I am a true child of Vienna, lead a merry life, and so my father has given me to the Deutschmeister; Deutschmeister is a very merry regiment, which wields in the one hand the saber, and in the other the Ziment." Ziment, I should add, is a beer-pot encompassing a rather awful quantity of fluid.)

One of the exploits of these "free and easy" people took a somewhat serious turn, and was justly reprimanded by the press. The barracks of our friends are situated on the Salzgries, a place which, like the streets leading to it, is principally inhabited by Israelites. The Jews from Galicia having business to transact at Vienna, used also to repair to those rather dirty regions. Now, returning one evening to their barracks from the Sperl, where they had been publicly feasted and congratulated upon their eventual prowess, our heroic wags, in a rather excited state of mind, gave some foretaste of their future operations by a sudden onslaught on the unhappy Israelites. They demolished the windows of some, trampled others down, cut off the beards of many, and even threw one unhappy victim into a tar-tun. Quietly passing people were apostrophized by the question, "Are you a Jew?" and on the answer being affirmative, mercilessly beaten, with noisy exclamations of "Macht nichts, der Jud wird geprügelt" ("never mind, the Jew must be cudgeled.") The hypersthenic feelings of those Vienna wags may be judged from one instance: A shoemaker's apprentice, of the age of fifteen, being refused admission to the volunteer corps by the recruiting sergeant, hung himself in despair.

The monetary and financial disturbance is visible in all regions, from the highest to the lowest. First, as you will have seen before from the European press, the Emperor himself has pawned the crown jewels. Then, in the second instance, whatever organ of the Vienna press be taken in hand, a prominent column headed "Patriotic Donations," is sure to strike the eye. These patriotic gifts, tendered either for war purposes in general or for the formation of volunteer corps in particular, vary extremely in amount, some falling as low as 2 florins 12 kreuzers, some rising to the respectable hight of 10,000 to 12,000 florins. The money donations are here and there interspersed with presents of a more medieval character, such as a pair of revolvers from a dealer in arms, paper for cartridges from a paper manufacturer, stuff for uniforms from a clothier, and so forth. Between the individual gifts there figure, more or less suspiciously, collections by provincial communes acting under the official pressure of their petty magistrates and Bürgermeisters (Mayors). One feature, however, distinguishes all the more valuable contributions, that of being tendered not in money of any kind, but in State obligations and coupons of public funds, so that the State is literally paid in "its own coin." The most unmistakable sign of the monetary derangement which intrudes itself upon you at every step is the total disappearance of small coin for the ready money transactions of daily life. The very moment the suspension of cash payments was officially announced together with the financial measures accompanying it, the small metallic currency, copper as well as silver, disappeared as if by the stroke of a magic wand. Recourse was taken to the same primitive method of parceling out larger paper into aliquot parts which so much bewildered the foreign visitor of Vienna in 1848—every individual holder of a one florin bank note, cutting it into so many fractions as he stood in need of for effecting his retail purchases. The Government, at Vienna and in the provinces, has tried to stop this dilaniating process by a proclamation warning the public that fragments of notes will not be received in payment by the tax-gatherer and by the bank. With regard to the bank this warning seems illegal, since there still exists a law of the year 1848, obliging the bank to accept such fractions of notes, and there is at the bank even a whole system for calculating them. It has been officiously asserted that there were in circulation 28,000,000 of florins in small cash, a sum which, it is added, twofold exceeded the real demand. The authorities, therefore,

"are resolved seriously to oppose the silly speculation, which at present renders the small currency scarce."

This supposition of a superabundance of small cash, is, of course, far from meeting the visible deficiency of the thing needful.

The authorities should have been aware that the premium on silver has risen enormously, that even copper bears a premium of 10 per cent, and that the peasantry are everywhere hoarding whatever sounds like metal. The Governors of Bohemia and Lower Austria have reminded the public of a law punishing all agiotage in silver and copper coins, with a fine of fifty florins, and even heavier penalties, but all in vain. Such repressive measures miss their effect, the more surely when coupled with such official announcements as that contained in the official part of the Wiener Zeitung, according to which the silver pieces of six kreuzers will be put out of legal circulation in the Lombardo-Venetian kingdom from the 1st of June, The Government will finally be compelled to act upon the petition of the Chamber of Commerce of Lower Austria, and, however unrespectable it may be, to issue government paper for retail transactions at the respective denominations of 5, 10 and 25 kreuzers.

Ascending now from the low regions of retail transactions to those of the money market and commerce, properly so called, we have first to note the failure, already known to you, of the eminent firm of Arnstein & Eskeles, which was declared on the 5th of May. They were the principal bill-brokers of the metropolis on whom the discount of bills not immediately to be transacted at the bank, and the rediscount of the industrial and commercial bills of the provinces principally devolved. Apart from the metropolis, the monetary transactions of the manufacturers of Hungary, Bohemia and Silesia, were concentrated in their hands. The firm boasted of a standing of 80 years, and its chief, Baron von Eskeles, united in his hands the functions of Director of the National Bank, Consul-General for Denmark, Chairman of the Discount Company of Lower Austria, President of the Company for State Railways, Administrator of the Southern Railway, etc. He was, in one word, next to Rothschild, the highest financial authority of the Empire. Arnstein & Eskeles had played a prominent part in the time of the Vienna Congress, when the salon of Frau von Arnstein formed a center of reunion for the political and literary celebrities of the day. One of the immediate causes leading to this failure, which involves a sum of about $30,000,000, was the refusal of the Paris Crédit Mobilier to honor the drafts of the Vienna firm. Consequent upon their downfall not a day has passed without a whole list of failures being registered at the Vienna Stock Exchange of firms, among which the most important are those of Solomon Cammando, Eidam & Co., G. Blanc, Plecher & Co., Diem & English, I. F. Gaartner, F. C. Schmidt, M. Greger & Co., the Brothers Pokorny, Moritz Kollinsky, Charles Zohler, A. Kirschmann, etc. In the Austrian provinces bankruptcies immediately connected with this disaster have broken out at Brünn, Prague, Reichenberg, Lemberg, etc., the most important being that of the firm of Lutheroth & Co. at Trieste, whose chief is the Prussian Consul and Director of the Austrian Lloyd. Beyond the confines of the Austrian States some first-rate houses at Breslau, Magdeburg, Munich, Frankfort, and the Loan and Commercial Bank at Cassel, have succumbed. Generally speaking, the present panic reminds one of the commercial panic at Hamburg in the Autumn of 1857, and the Hamburg proceedings for the alleviation of the panic will also be imitated by this Government. Some relaxation will take place in the laws concerning bills of exchange; the National Bank will form a Committee for the support of firms only momentarily driven to a suspension of payments by the general state of discredit, and two millions of paper money will be granted to the banks of Prague and Brünn.