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In consequence of these failures, and of the refusal to be allowed to purchase on the Mississippi, the army, especially in Virginia, was put upon short rations. First, they were reduced to one half pound of meat per day --which, if it could have been kept up at that, would have been sufficient --then to one-third of a pound-though this allowance was not agreed to or adhered to by several of the Generals commanding-and then to one quarter of a pound. Upon this last allowance the Army of Northern Virginia wintered.

The policy of running the blockade, so far as the government was interested in it for subsistence, was the occasion of odious monopolies, violations of contract, misunderstandings, &c., and proved of little advantage to the government, and of questionable profit to private parties. What was known as the Crenshaw or Collie line of steamers did not start until the spring of 1864, and then under unfavourable auspices. One steamer was lost on the coast of Ireland, in coming out; another upon her second trip; but two others, both very superiour steamers, were put upon the line, one or both of which had been paid for by large advances made by Crenshaw & Co., and were running successfully. Under their contract the government was obliged to furnish the whole cargo of cotton for each vessel, but, having failed to do so, and the private parties having been required, against the terms of the contract, to supply their own cotton to the vessel at market rates — a demand which was acceded to rather than raise the issue — it was determined to take other parties into the contract. This was rendered necessary by the inability of the government to transport the cotton, and by the inability of the private parties to supplement the government deficiencies in that particular. The government was accordingly induced by the private parties to sell one-fourth of its three-fourths interest in the steamers to the Supply Importing Company, composed of various railroad companies and others interested in railroads in the South. This-though the terms of the contract were changed, and the parties became, as was contended by the government, mere carriers, whereby the subsistence department lost the benefit of the arrangement it had proposed --at once obviated the difficulties about transporting cotton; and, as this new contract provided for twelve steamers, it was hoped that some good results might be at last reached. But just as this business had got well under way, the government decided upon taking the Atalanta, the best of the steamers referred to above, for a cruiser. It was urged, in opposition to this, that the tested speed and capacity of this vessel had induced the private parties interested to enter into large contracts for vessels in England, and to assume heavy obligations to pay for the government interest in them; that there were large quantities of subsistence stores at the Islands, purchased by Crenshaw & Co. for the commissariat, which were much needed by the army, and might spoil if permitted to remain. But

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