From the first I was firm in the conviction that no peace could be had that would be stable and conducive to the happiness of the people, both North and South, until the military power of the rebellion was entirely broken. I therefore determined, first, to use the greatest number of troops practicable against the armed force of the enemy, preventing him from using the same force at different seasons against first one and then another of our armies, and the possibility of repose for refitting and producing necessary supplies for carrying on resistance; second, to hammer continuously against the armed force of thee enemy and his resources until, by mere attrition, if in no other way, there should be nothing left to him but an equal submission with the loyal section of our common country to the constitution and laws of the land. These views have been kept constantly in mind, and orders given and campaigns made to carry them out. Whether they might have been better in conception and execution is for the people, who mourn the loss of friends fallen, and whole have to pay the pecuniary cost, to say. All I can say is, that what I have done has been done conscientiously, to the best of my ability,and in what I conceived to be for the best interests of the whole country.

At the date when this report begins the situation of the contending forces was about as follows: The Mississippi River was strongly garrisoned by Federal troops from Saint Louis, Mo., to its mouth. The line of the Arkansas was also held, thus giving us armed possession of all west of the Mississippi north of that stream. A few points in Southern Louisiana, not remote from the river, were held by us, together with a small garrison at and near the mouth of the Rio Grande. All the balance of the vast territory of Arkansas, Louisiana and Texas was in the almost undisputed possession of the enemy, with an army been brought into the field had there been sufficient opposition to have brought them out. the let-alone policy had demoralized this force, so that probably but little more than one-half, or 40,000 men, with the bands of guerrillas scattered through Missouri, Arkansas, and along the Mississippi River, and the disloyal character of much of the population, compelled the use of a large number of troops to keep navigation open on the river and to protect the loyal people to the west of it. To the east of the Mississippi we held substantially with the line of the Tennessee and Holston Rivers, running eastward to include nearly all of the State of Tennessee. South of Chattanooga a small foothold had been obtained in Georgia, sufficient to protect East Tennessee from incursions from the enemy's force at Dalton, Ga. West Virginia was substantially within our lines. Virginia, with the exception of the northern border, the Potomac River, a small area about the mouth of James River covered by the troops at Norfolk and Fort Monroe, and the territory covered by the Army of the Potomac lying along the Rapidan, was in the possession of the enemy. Along the sea-coast footholds had been obtained at Plymouth, Washington, and New Berne, in North Carolina; Beaufort, Folly, and Morris Islands, Hilton Head Fort Pulaski,and Port Royal, in South Carolina; Fernandina and Saint Augustine, in Florida. Key West and Pensacola were also in our possession, while all the important ports were blockaded by the Navy. The accompanying map,* a copy of which was sent to General Sherman and other commanders in March,

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*See explanatory foot-note, Vol. XXXII, Part III, p.261.

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