_December 18th._--The last few days have been entirely occupied by the interest of the Budget debate and speculations as to the result. We received the account of the division at Panshanger yesterday morning, not without astonishment; for although the opinion had latterly been gaining ground that the Government would be beaten, nobody expected such a majority against them.[1] Up to the last they were confident of winning. The debate was all against them, and only exhibited their weakness in the House of Commons. It was closed by two very fine speeches from Disraeli and Gladstone, very different in their style, but not unequal in their merits. [Footnote 1: The division on the Budget took place on December 16 after five nights' debate, the numbers being--for the Government, 286; against, 305; adverse majority, 19.] _Panshanger, December 19th._--I went to town yesterday morning to hear what was going on. Lord Derby returned from Osborne in the middle of the day, and the Queen had sent for Lords Lansdowne and Aberdeen. She had been gracious to Derby, and pressed him to stay on, if it were only for a short time. I saw Talbot, and from the few words he let drop I gathered that they have already resolved to keep together, and to enter on a course of bitter and determined opposition. Not that he said this, of course, but he intimated that he had no idea of any new Government that might be formed being able to go on even for a short time, and that they would very speedily be let in again. The language of the Carlton corresponds with this, and I have no doubt they will be as virulent and as mischievous as they can. It remains to be seen, if a good Government is formed, whether some will not be more moderate, and disposed to give the new Cabinet a fair trial. Clarendon writes me word that the meeting at Woburn between John Russell, Aberdeen, Newcastle, and himself has been altogether satisfactory, everybody ready to give and take, and anxious to promote the common cause, without any selfish views or prejudices. Newcastle is particularly reasonable, disclaiming any hostility to John Russell, and only objecting to his being at present the nominal head of the Government, because there is rightly or wrongly a prejudice against him, which would prevent some Liberals and some Peelites joining the Government if he was placed in that position; but he contemplates his ultimately resuming that post, and he (Newcastle) is ready to do anything in office or out. There is no disposition to take in Cobden and Bright, but they would not object to Molesworth.