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Up to the summer of 1657 Lambert remained the strongest supporter of the Protector. In October 1654, when the ‘instrument of government was under discussion, he made a long speech to persuade the parliament that it was necessary to make the protectorship hereditary, but some believed he did so merely to remove all jealousy of his own aiming, knowing it would be rejected for the other’ (ib. ii. 681–5; Cal. Clarendon Papers, ii. 438). When the major-generals were appointed he was entrusted with the care of the five northern counties, but acted through deputies, Colonels Charles Howard and Robert Lilburne (Cal. State Papers, Dom. 1655, p. 387). He was undoubtedly one of the chief instigators of their establishment, and in the parliament of 1656 no one was more eager for their continuance. ‘I wish,’ he said, ‘any man could propound an expedient to be secure against your common enemies by another way than as the militia is settled. The quarrel is now between light and darkness, not who shall rule, but whether we shall live or be preserved or no. Good words will not do with the cavaliers’ (Burton, Cromwellian Diary, ii. 240, 319; Cal. Clarendon Papers, iii. 239; Cal. State Papers, Dom. 1655, p. 296). On questions of public policy his views were much the same as the Protector's. He advocated the war with Spain, and was anxious to keep the Sound from falling into the possession of the Dutch or Danes or of any single power (Burton, iii. 400). He was in favour of liberty of conscience, spoke on behalf of James Nayler, and approved the Protector's intervention on his behalf (ib. i. 33, 218; Hobbes, Behemoth, p. 187, ed. Tönnies). Like Cromwell, he firmly believed in the necessity of limiting the power of parliament by constitutional restrictions (Burton, i. 255, 281). In dealing with republicans who refused to own the legitimacy of Cromwell's government no one of the Protector's council was less conciliatory (Ludlow, pp. 555, 573). At the same time Lambert seemed to outsiders to be independent of the Protector and almost equal in power. He was ‘the army's darling.’ As fast as recalcitrant officers were cashiered he filled their places with his supporters. He was major-general of the army, colonel of two regiments, a member of the council, and a lord of the Cinque ports, enjoying from these offices an income of 6,500l. a year (‘A Narrative of the Late Parliament,’ Harleian Miscellany, ed. Park, iii. 452; Cal. Clarendon Papers, ii. 380). ‘It lies in his power,’ wrote a royalist, ‘to raise Oliver higher or else to set up in his place. One of the council's opinion being asked what he thought Lambert did intend, his answer was that Lambert would let this man continue protector, but that he would rule him as he pleased’ (Carte, Original Letters, ii. 89).

The question of kingship caused an open breach between Lambert and Cromwell. Cromwell plainly asserted that the title of king had been originally offered to him in the first draft of the instrument of government, and hinted that Lambert was responsible for the offer (Burton, i. 382; Godwin, History of the Commonwealth, iv. 9). But now, at all events, Lambert steadfastly opposed it, and people believed he would raise a mutiny in the army rather than consent to it. In the end Thurloe, who at first shared these suspicions, announced to Henry Cromwell that Lambert ‘stood at a distance’ and allowed things to take their course, leaving Fleetwood and Desborough to lead the opposition. But he joined with them in telling the Protector that if the title were accepted all three would resign (Thurloe, vi. 75, 93, 219, 281; Clarendon State Papers, iii. 326, 333). Cromwell's refusal of the dignity did not put an end to Lambert's discontent. On 24 June 1657 parliament determined to impose an oath on all councillors and other officials (Commons' Journals, vii. 572). Lambert strenuously opposed the oath in parliament, refused to take it when it was passed, and absented himself from the meetings of the council (Burton, ii. 276, 295; Cal. State Papers, Dom. 1657–8, pp. 13, 40). Finally Cromwell demanded the surrender of his commissions (23 July 1657; Thurloe, vi. 412, 425, 427; Hist. MSS. Comm. 3rd Rep. p. 247).

For the rest of the protectorate Lambert lived in retirement at his house at Wimbledon, which he had purchased when the queen's lands were sold. His regiment of foot was given to Fleetwood, his regiment of horse to Lord Falconbridge. To soften the blow, or ‘to keep him from any desperate undertaking,’ Cromwell allowed him a pension of 2,000l. a year (Ludlow, p. 594). About six months before he died Cromwell sought a reconcilation with his old friend. When Lambert came to Whitehall ‘Cromwell fell on his neck, kissed him, inquired of dear Johnny for his jewel (so he calls Mrs. Lambert) and for all his children by name. The day following she visited Cromwell's wife, who fell immediately into a kind quarrel for her long absence, disclaimed policy or statecraft, but professed a motherly kindness to her and hers, which no change should ever alter’ (Clarendon State Papers, iii. 329). But the breach was too wide to be closed. Royalist agents tried to use it to win Lambert to their cause, but without success. ‘I