Howe meanwhile sailed up the Chesapeake, and advanced on Philadelphia, the temporary capital of the United States and the seat of the Congress. The rout of his little army of seven thousand men at Brandywine forced Washington to abandon Philadelphia, and, after a bold but unsuccessful attack on his victors, to retire into winter quarters on the banks of the Schuylkill; where the unconquerable resolve with which he nerved his handful of beaten and half-starved troops to face Howe's army in their camp at Valley Forge is the noblest of his triumphs. But in the north the war had taken another colour. When Burgoyne appeared on the Upper Hudson he found the road to Albany barred by an American force under General Gates. The spirit of New England, which had grown dull as the war rolled away from its borders, quickened again at the news of invasion and of the outrages committed by the Indians whom Burgoyne employed among his troops. Its militia hurried from town and homestead to the camp; and after a fruitless attack on the American lines, Burgoyne saw himself surrounded on the heights of Saratoga. On the 17th of October he was compelled to surrender.

The news of this calamity gave force to the words with which Chatham at the very time of the surrender was pressing for peace. "You cannot conquer America," he cried when men were glorying in Howe's successes. " If I were an American as I am an Englishman, while a foreign troop was landed in my country, I never would lay down my arms - never, never, never! " Then in a burst of indignant eloquence he thundered against the use of the Indian and his scalping-knife as allies of England against her children. The proposals which Chatham brought forward might perhaps, in his hands, even yet have drawn America and the mother country together. His plan was one of absolute conciliation, and of a federal union between the settlements and Great Britain which would have left the Colonies absolutely their own masters in all matters of internal government, and linked only by ties of affection and loyalty to the general body of the Empire. But it met with the same fate as his previous proposals. Its rejection was at once followed by the news of Saratoga, and by the yet more fatal news that this disaster had roused the Bourbon Courts to avenge the humiliation of the Seven Years' War. In February 1778 France concluded an alliance with the States. Lord North strove to meet the blow by fresh offers of conciliation, and by a pledge to renounce for ever the right of direct taxation over the Colonies; but he felt that the time for conciliation was past, while all hope of reducing America by force of arms had disappeared.

George indeed was as obstinate for war as ever; and the country, stung to the quick by the attack of France, backed passionately the obstinacy of the King. But unlike George the Third, it instinctively felt that if a hope still remained of retaining the friendship of the Colonies, and of baffling the efforts of the Bourbons, it lay in Lord Chatham; and in spite of the King's resistance the voice of the whole country called him back to power. But on the eve of his return to office this last chance was shattered by the hand of death. Broken with age and disease, the Earl was borne to the House of Lords to utter in a few broken words his protest against the proposal to surrender America. "I rejoice," he murmured, "that I am still alive to lift up my voice against the dismemberment of this ancient and noble monarchy. His Majesty succeeded to an Empire as great in extent as its reputation was unsullied. Seventeen years ago this people was the terror of the world." He listened impatiently to the reply of the Duke of Richmond, and again rose to his feet.

But he had hardly risen when he pressed his hand upon his heart, and falling back in a swoon was borne home to die.

From the hour of Chatham's death England entered on a conflict with enemies whose circle gradually widened till she stood single-handed against the world. At the close of 1778 Spain joined the league of France and America against her; and in the next year the joint fleets of the two powers rode the masters of the Channel. They even threatened a descent on the English coast. But dead as Chatham was, his cry woke a new life in England. "Shall we fall prostrate," he exclaimed with his last breath, "before the House of Bourbon?" and the divisions which had broken the nation in its struggle with American liberty were hushed in the presence of this danger to its own existence. The weakness of the Ministry was compensated by the energy of England itself. For three years, from 1779 to 1782, General Elliott held against famine and bombardment the rock fortress of Gibraltar. Although a quarrel over the right of search banded Holland and the Courts of the North in an armed neutrality against her, and added the Dutch fleet to the number of her assailants, England held her own at sea. Even in America the fortune of the war seemed to turn.

After Burgoyne's surrender the English generals had withdrawn from Pennsylvania, and bent all their efforts on the South where a strong Royalist party still existed. The capture of Charles-town and the successes of Lord Cornwallis in 1780 were rendered fruitless by the obstinate resistance of General Greene; but the States were weakened by bankruptcy, and unnerved by hopes of aid from France. Meanwhile England was winning new triumphs in the East.

Since the day of Plassey, India had been fast passing into the hands of the merchant company whose traders but a few years before held only three petty factories along its coast. The victory which laid Bengal at the feet of Give had been followed in 1760 by a victory at Wandewash, in which Colonel Coote's defeat of Lally, the French Governor of Pondicherry, established British supremacy over Southern India. The work of organization had soon to follow on that of conquest; for the tyranny and corruption of the merchant-clerks who suddenly found themselves lifted into rulers was fast ruining the province of Bengal; and although Ciive had profited more than any other by the spoils of his victory, he saw that the time had come when greed must give way to the responsibilities of power. In 1765 he returned to India, and the two years of his rule were in fact the most glorious years in his life. In the teeth of opposition from every clerk and of mutiny throughout the army, he put down the private trading of the Company's servants and forbade their acceptance of gifts from the natives.