HEADQUARTERS CHALMERS' CAVALRY, Oxford, Miss., December 14, 1863.

Colonel B. S. EWELL,
Assistant Adjutant-General:

COLONEL: As General Johnston would not permit me to visit him I must ask that he will read the following statement and accompanying documents. He is evidently displeased with me about the trade that has been carried on with the enemy and about my General Orders, No. 71, and I desire to show him how both were brought about, and I think that we he will not them censure me.

First. I call attention first to my first general order, which you will find printed. Under this order I captured a number of wagons and teams and nearly $200,000 worth of goods, which were all released by order of General Pemberton, as will be seen from the telegrams herewith filed, marked No. 1.*

Second. I next call attention to my telegram giving legal opinion of Judge Clayton and to my letter marked 2* to which I received no answer except an order to turn the goods over to the owners.

Third. I next call attention to my letters* 3 and 4, and the answer of General Pemberton by Major Memminger, and I then refer to my letter (5)* to the Confederate commissioner, and I state that he came to Panola and declined taking the goods.

Fourth. I had another order from General Pemberton which cannot now be found, but which I can prove by my own staff and by Colonel Jacob Thompson, of General Pemberton's staff, the purport of which was that the military authorities could not interfere with goods coming from the enemy except to turn them over to the civil authorities, but authorized me to impress such articles as the Government wanted at a cost not exceeding 75 per cent. on the original cost.

This order was equivalent to opening the trade, and under it commissaries and quartermasters proceeded to get supplies for the army. These were the last orders I had received on the subject until I received General Johnston's telegram after he received my General Orders, No. 71. If General Johnston ever issued any orders about seizing articles coming from the enemy before that time they did not come to me. My ordnance officer was supplied by Colonel Gorgas with money to purchase army pistols and percussion-caps from Memphis, as can be shown by orders to him.

After the fall of Vicksburg our currency fell so low in Memphis that it could not be used, and many efforts were made to fall upon some plan by which cotton could be used. Believing from what I had seen and what I had heard from men in authority that the policy of our Government was changing on the subject, and that our officials desired to get all they could from the enemy if they could do it without giving the advantage of the trade to the enemy, I prepared my General Orders, No. 71. I had no idea of giving offense to General Johnston. On the contrary I hoped to have his approval for framing an order that would obviate all difficulties that seemed to be in the way. I believed, and still believe, that my order would meet the approval of the President and the Secretary of War; and the very best evidence that could be adduced as to the benefit to be derived by us from my orders is to be found in the fact that as soon as the enemy saw it they closed their lines and stopped the trade.

General Pemberton had been as much opposed to the trade with

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*Not found as inclosures.

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