E. D. R. S. Canby to Paymaster-General U.s. Army, Washington, D. C, November 18, 1861

l : Santa Fé, N. Mex., November 18, 1861. PAYMASTER-GENERAL U.S. ARMY, Washington, D. C.: SIR: The military operations in this department have for several months past been greatly embarrassed, and are now almost entirely paralyzed, by the want of funds in the pay department. Many of the regular troops have not:been paid for more than twelve months, and — the volunteers not at all. This has occasioned a great deal of suffering and some dissatisfaction in both classes, and has almost effectually put an end to the raising of volunteers. This condition of affairs, so far as it then existed, was officially reported by me some months since (June 13, 1861), and has since repeatedly, by reports and estimates, been brought to the notice of the proper authorities. ;

An unsuccessful attempt was made some time since to borrow money for the Government, and a recent attempt has been made, which promises to be partially successful; but to insure this success, the chief quartermaster and chief commissary have united with me in promising that this money shall be repaid in Treasury notes, bearing 7 .9 per cent. interest from the date of the loan ; or, failing in this arrangement, Ihave

personally pledged myself for the interest. A

I have the honor to request that arrangements may be made by your department to redeem this promise. In making this arrangement many of the leading merchants and captalists of the Territory have pledged their eredit for the repayment of the loan.

This arrangement has been made mainly through the instrumentality of the ehief quartermaster, Major Donaldson, and but for the confidence reposed in him by the community generally it could not have been made. In addition to this, $60,000 have been loaned by the quarter- master to the pay department.

Very respectfully, sir, your obedient servant,