this army and its future operations. Four agents have at different times been sent to the capital with estimates for funds, but all, with the single exception of Major Carr, have returned empty-handed. That officer received $4,000,000, with orders from the Quartermaster-General to pay over to Waul's Legion (not connected with this department) $500,000, and to turn over $1,000,000 more to the quartermaster of General Taylor, in Louisiana, where it was not needed, leaving but $2,500,000 for the use of this army. Many of the troops in this department have now been in service from six to twelve months, some of whom have received neither pay nor bounty, and have families suffering at home the extreme of destitution. The sum brought by Major Carr-barely sufficient to meet the payments due the troops - I have been compelled from necessity to divide, taking from the soldiers for the use of the quartermaster's and commissary departments. I ordered $1,000,000 to be transferred to the first and $250,000 to the last, leaving but $1,250,000 for pay to the troops, limiting the payment of all to June 30, except of regiments who have more than four months due, who are limited to April 30. Though bad enough, this is not the worst evil I have to contend with. Certified accounts are scattered broadcast through the entire country, and many are held by persons in indigent circumstances, who, having sold to the agents of the Government all their subsistence, have now neither provisions nor money with which to purchase what are required for the support of their families. The debt due this class of people is very large, and has now ben awaiting payment for many months. I am assured that the entire amount of Government indebtedness in this department now exceeds $13,000,000, and the people refuse to sell any more to the Government on credit. The funds in hand are wholly inadequate to procure forage, and subsistence, meet incidental expenses, and pay for clothing, which item will alone absorb upward of $2,000,000. The disbursements necessary to be made for the army up to January 1, 1863, together with the payment of outstanding debts, will require the full amount of the estimates forwarded in September to the Quartermaster-General, less the sum of $4,000,000 delivered to Major Carr. These estimates called for $24,585,000, and it is absolutely necessary that the money should be furnished with the least possible delay. I earnestly request that you will give this matter your immediate consideration, and cause to be transmitted to me at the earliest day possible at least a portion of the funds asked for in the estimates already furnished, and the remainder as soon after as it can be prepared. I have issued the most stringent orders relative to economy in disbursements and promptness in rendering accounts; and whatever may have been the irregularities heretofore, I am confident I can be responsible for the future, not only as regards an economical administration, but also to secure to the Government the affections of a warmhearted people, whose, confidence has been tampered with, and to a certain degree shaken, by our failure to meet our obligations, being used by politicians to our prejudice.

I am, sir, very respectfully,

THE. H. HOLMES,

Major-General Commanding.

[Indorsement.]

Answer, stating the additional remittance not received at date of

57 R R-VOL XIII