Torn by internal dissensions, the maintenance of neutrality by the Republic became even more difficult than in the Seven Years’ War.  The old questions of illicit trade with the enemy and the carrying of contraband arose.  The Dutch islands of St Eustatius and Curacoa became centres of smuggling enterprise; and Dutch merchant vessels were constantly being searched by the British cruisers and often carried off as prizes into English ports.  Strong protests were made and great irritation aroused.  Amsterdam was the chief sufferer.  Naturally in this hot-bed of Republican opinion and French sympathies, the prince was blamed and was accused of preferring English interests to those of his own country.  The arrival of the Duke de la Vauguyon, as French ambassador, did much to fan the flame.  Vauguyon entered into close relations with the Amsterdam regents and did all in his power to exacerbate the growing feeling of hostility to England, and to persuade the Republic to abandon the ancient alliance with that country in favour of one with France.

The British ambassador, Yorke, lacked his ingratiating manners; and his language now became imperative and menacing in face of the flourishing contraband trade that was carried on at St Eustatius.  In consequence of his strong protest the governor of the island, Van Heyliger, was replaced by De Graeff, but it was soon discovered that the new governor was no improvement upon his predecessor.  He caused additional offence to the British government by saluting the American flag on November 16, 1776.  The threats of Yorke grew stronger, but with small result.  The Americans continued to draw supplies from the Dutch islands.  The entry of France into the war on February 6, 1778, followed by that of Spain, complicated matters.  England was now fighting with her back to the wall; and her sea-power had to be exerted to its utmost to make head against so many foes.  She waged relentless war on merchant ships carrying contraband or suspected contraband, whether enemy or neutral.  At last money was voted under pressure from Amsterdam, supported by the prince, for the building of a fleet for protection against privateers and for purposes of convoy.  But a fleet cannot be built in a day; and, when Admiral van Bylandt was sent out in 1777, his squadron consisted of five ships only.  Meanwhile negotiations with England were proceeding and resulted in certain concessions, consent being given to allow what was called “limited convoy.”  The States-General, despite the opposition of Amsterdam, accepted on November 13, 1778, the proffered compromise.  But the French ambassador Vauguyon supported the protest of Amsterdam by threatening, unless the States-General insisted upon complete freedom of trade, to withdraw the commercial privileges granted to the Republic by France.  Finding that the States-General upheld their resolution of November 13, he carried his threat into execution.  This action brought the majority of the Estates of