FIRST ANNUAL MESSAGE.

WASHINGTON, _December 8, 1857_.

_Fellow-Citizens of the Senate and House of Representatives_:

In obedience to the command of the Constitution, it has now become my

duty "to give to Congress information of the state of the Union and

recommend to their consideration such measures" as I judge to be

"necessary and expedient."

But first and above all, our thanks are due to Almighty God for the

numerous benefits which He has bestowed upon this people, and our united

prayers ought to ascend to Him that He would continue to bless our great

Republic in time to come as He has blessed it in time past. Since the

adjournment of the last Congress our constituents have enjoyed an

unusual degree of health. The earth has yielded her fruits abundantly

and has bountifully rewarded the toil of the husbandman. Our great

staples have commanded high prices, and up till within a brief period

our manufacturing, mineral, and mechanical occupations have largely

partaken of the general prosperity. We have possessed all the elements

of material wealth in rich abundance, and yet, notwithstanding all these

advantages, our country in its monetary interests is at the present

moment in a deplorable condition. In the midst of unsurpassed plenty in

all the productions of agriculture and in all the elements of national

wealth, we find our manufactures suspended, our public works retarded,

our private enterprises of different kinds abandoned, and thousands

of useful laborers thrown out of employment and reduced to want. The

revenue of the Government, which is chiefly derived from duties on

imports from abroad, has been greatly reduced, whilst the appropriations

made by Congress at its last session for the current fiscal year are

very large in amount.

Under these circumstances a loan may be required before the close of

your present session; but this, although deeply to be regretted, would

prove to be only a slight misfortune when compared with the suffering

and distress prevailing among the people. With this the Government can

not fail deeply to sympathize, though it may be without the power to

extend relief.

It is our duty to inquire what has produced such unfortunate results and

whether their recurrence can be prevented. In all former revulsions the

blame might have been fairly attributed to a variety of cooperating

causes, but not so upon the present occasion. It is apparent that our

existing misfortunes have proceeded solely from our extravagant and

vicious system of paper currency and bank credits, exciting the people

to wild speculations and gambling in stocks. These revulsions must

continue to recur at successive intervals so long as the amount of the

paper currency and bank loans and discounts of the country shall be left

to the discretion of 1,400 irresponsible banking institutions, which

from the very law of their nature will consult the interest of their

stockholders rather than the public welfare.

The framers of the Constitution, when they gave to Congress the power

"to coin money and to regulate the value thereof" and prohibited the

States from coining money, emitting bills of credit, or making anything

but gold and silver coin a tender in payment of debts, supposed they had

protected the people against the evils of an excessive and irredeemable

paper currency. They are not responsible for the existing anomaly that

a Government endowed with the sovereign attribute of coining money and

regulating the value thereof should have no power to prevent others

from driving this coin out of the country and filling up the channels

of circulation with paper which does not represent gold and silver.

It is one of the highest and most responsible duties of Government to

insure to the people a sound circulating medium, the amount of which

ought to be adapted with the utmost possible wisdom and skill to the

wants of internal trade and foreign exchanges. If this be either greatly

above or greatly below the proper standard, the marketable value of

every man's property is increased or diminished in the same proportion,

and injustice to individuals as well as incalculable evils to the

community are the consequence.

Unfortunately, under the construction of the Federal Constitution

which has now prevailed too long to be changed this important and

delicate duty has been dissevered from the coining power and virtually

transferred to more than 1,400 State banks acting independently of each

other and regulating their paper issues almost exclusively by a regard

to the present interest of their stockholders. Exercising the sovereign

power of providing a paper currency instead of coin for the country,

the first duty which these banks owe to the public is to keep in

their vaults a sufficient amount of gold and silver to insure the

convertibility of their notes into coin at all times and under all

circumstances. No bank ought ever to be chartered without such

restrictions on its business as to secure this result. All other

restrictions are comparatively vain. This is the only true touchstone,

the only efficient regulator of a paper currency--the only one which

can guard the public against overissues and bank suspensions. As a

collateral and eventual security, it is doubtless wise, and in all cases

ought to be required, that banks shall hold an amount of United States

or State securities equal to their notes in circulation and pledged for

their redemption. This, however, furnishes no adequate security against

overissues. On the contrary, it may be perverted to inflate the

currency. Indeed, it is possible by this means to convert all the debts

of the United States and State Governments into bank notes, without

reference to the specie required to redeem them. However valuable these

securities may be in themselves, they can not be converted into gold

and silver at the moment of pressure, as our experience teaches, in

sufficient time to prevent bank suspensions and the depreciation of

bank notes. In England, which is to a considerable extent a paper-money

country, though vastly behind our own in this respect, it was deemed

advisable, anterior to the act of Parliament of 1844, which wisely

separated the issue of notes from the banking department, for the Bank

of England always to keep on hand gold and silver equal to one-third of

its combined circulation and deposits. If this proportion was no more

than sufficient to secure the convertibility of its notes with the whole

of Great Britain and to some extent the continent of Europe as a field

for its circulation, rendering it almost impossible that a sudden and

immediate run to a dangerous amount should be made upon it, the same

proportion would certainly be insufficient under our banking system.

Each of our 1,400 banks has but a limited circumference for its

circulation, and in the course of a very few days the depositors and

note holders might demand from such a bank a sufficient amount in specie

to compel it to suspend, even although it had coin in its vaults equal

to one-third of its immediate liabilities. And yet I am not aware, with

the exception of the banks of Louisiana, that any State bank throughout

the Union has been required by its charter to keep this or any other

proportion of gold and silver compared with the amount of its combined

circulation and deposits. What has been the consequence? In a recent

report made by the Treasury Department on the condition of the banks

throughout the different States, according to returns dated nearest to

January, 1857, the aggregate amount of actual specie in their vaults is

$58,349,838, of their circulation $214,778,822, and of their deposits

$230,351,352. Thus it appears that these banks in the aggregate have

considerably less than one dollar in seven of gold and silver compared

with their circulation and deposits. It was palpable, therefore, that

the very first pressure must drive them to suspension and deprive the

people of a convertible currency, with all its disastrous consequences.

It is truly wonderful that they should have so long continued to

preserve their credit when a demand for the payment of one-seventh of

their immediate liabilities would have driven them into insolvency. And

this is the condition of the banks, notwithstanding that four hundred

millions of gold from California have flowed in upon us within the last

eight years, and the tide still continues to flow. Indeed, such has been

the extravagance of bank credits that the banks now hold a considerably

less amount of specie, either in proportion to their capital or to their

circulation and deposits combined, than they did before the discovery of

gold in California. Whilst in the year 1848 their specie in proportion

to their capital was more than equal to one dollar for four and a half,

in 1857 it does not amount to one dollar for every six dollars and

thirty-three cents of their capital. In the year 1848 the specie was

equal within a very small fraction to one dollar in five of their

circulation and deposits; in 1857 it is not equal to one dollar in

seven and a half of their circulation and deposits.

From this statement it is easy to account for our financial history for

the last forty years. It has been a history of extravagant expansions

in the business of the country, followed by ruinous contractions. At

successive intervals the best and most enterprising men have been

tempted to their ruin by excessive bank loans of mere paper credit,

exciting them to extravagant importations of foreign goods, wild

speculations, and ruinous and demoralizing stock gambling. When the

crisis arrives, as arrive it must, the banks can extend no relief to the

people. In a vain struggle to redeem their liabilities in specie they

are compelled to contract their loans and their issues, and at last,

in the hour of distress, when their assistance is most needed, they and

their debtors together sink into insolvency.

It is this paper system of extravagant expansion, raising the nominal

price of every article far beyond its real value when compared with

the cost of similar articles in countries whose circulation is wisely

regulated, which has prevented us from competing in our own markets with

foreign manufacturers, has produced extravagant importations, and has

counteracted the effect of the large incidental protection afforded

to our domestic manufactures by the present revenue tariff. But for

this the branches of our manufactures composed of raw materials,

the production of our own country--such as cotton, iron, and woolen

fabrics--would not only have acquired almost exclusive possession of

the home market, but would have created for themselves a foreign market

throughout the world.

Deplorable, however, as may be our present financial condition, we

may yet indulge in bright hopes for the future. No other nation has

ever existed which could have endured such violent expansions and

contractions of paper credits without lasting injury; yet the buoyancy

of youth, the energies of our population, and the spirit which never

quails before difficulties will enable us soon to recover from our

present financial embarrassments, and may even occasion us speedily

to forget the lesson which they have taught.

In the meantime it is the duty of the Government, by all proper means

within its power, to aid in alleviating the sufferings of the people

occasioned by the suspension of the banks and to provide against a

recurrence of the same calamity. Unfortunately, in either aspect of the

case it can do but little. Thanks to the independent treasury, the

Government has not suspended payment, as it was compelled to do by

the failure of the banks in 1837. It will continue to discharge its

liabilities to the people in gold and silver. Its disbursements in coin

will pass into circulation and materially assist in restoring a sound

currency. From its high credit, should we be compelled to make a

temporary loan, it can be effected on advantageous terms. This, however,

shall if possible be avoided, but if not, then the amount shall be

limited to the lowest practicable sum.

I have therefore determined that whilst no useful Government works

already in progress shall be suspended, new works not already commenced

will be postponed if this can be done without injury to the country.

Those necessary for its defense shall proceed as though there had been

no crisis in our monetary affairs.

But the Federal Government can not do much to provide against a

recurrence of existing evils. Even if insurmountable constitutional

objections did not exist against the creation of a national bank, this

would furnish no adequate preventive security. The history of the last

Bank of the United States abundantly proves the truth of this assertion.

Such a bank could not, if it would, regulate the issues and credits of

1,400 State banks in such a manner as to prevent the ruinous expansions

and contractions in our currency which afflicted the country throughout

the existence of the late bank, or secure us against future suspensions.

In 1825 an effort was made by the Bank of England to curtail the issues

of the country banks under the most favorable circumstances. The paper

currency had been expanded to a ruinous extent, and the bank put forth

all its power to contract it in order to reduce prices and restore the

equilibrium of the foreign exchanges. It accordingly commenced a system

of curtailment of its loans and issues, in the vain hope that the joint

stock and private banks of the Kingdom would be compelled to follow its

example. It found, however, that as it contracted they expanded, and at

the end of the process, to employ the language of a very high official

authority, "whatever reduction of the paper circulation was effected by

the Bank of England (in 1825) was more than made up by the issues of the

country banks."

But a bank of the United States would not, if it could, restrain the

issues and loans of the State banks, because its duty as a regulator

of the currency must often be in direct conflict with the immediate

interest of its stockholders. If we expect one agent to restrain or

control another, their interests must, at least in some degree, be

antagonistic. But the directors of a bank of the United States would

feel the same interest and the same inclination with the directors of

the State banks to expand the currency, to accommodate their favorites

and friends with loans, and to declare large dividends. Such has been

our experience in regard to the last bank.

After all, we must mainly rely upon the patriotism and wisdom of the

States for the prevention and redress of the evil. If they will afford

us a real specie basis for our paper circulation by increasing the

denomination of bank notes, first to twenty and afterwards to fifty

dollars; if they will require that the banks shall at all times keep on

hand at least one dollar of gold and silver for every three dollars

of their circulation and deposits, and if they will provide by a

self-executing enactment, which nothing can arrest, that the moment they

suspend they shall go into liquidation, I believe that such provisions,

with a weekly publication by each bank of a statement of its condition,

would go far to secure us against future suspensions of specie payments.

Congress, in my opinion, possess the power to pass a uniform bankrupt

law applicable to all banking institutions throughout the United

States, and I strongly recommend its exercise. This would make it the

irreversible organic law of each bank's existence that a suspension

of specie payments shall produce its civil death. The instinct of

self-preservation would then compel it to perform its duties in such

a manner as to escape the penalty and preserve its life.

The existence of banks and the circulation of bank paper are so

identified with the habits of our people that they can not at this day

be suddenly abolished without much immediate injury to the country.

If we could confine them to their appropriate sphere and prevent them

from administering to the spirit of wild and reckless speculation by

extravagant loans and issues, they might be continued with advantage

to the public.

But this I say, after long and much reflection: If experience shall

prove it to be impossible to enjoy the facilities which well-regulated

banks might afford without at the same time suffering the calamities

which the excesses of the banks have hitherto inflicted upon the

country, it would then be far the lesser evil to deprive them altogether

of the power to issue a paper currency and confine them to the functions

of banks of deposit and discount.

Our relations with foreign governments are upon the whole in a

satisfactory condition.

The diplomatic difficulties which existed between the Government of the

United States and that of Great Britain at the adjournment of the last

Congress have been happily terminated by the appointment of a British

minister to this country, who has been cordially received.

Whilst it is greatly to the interest, as I am convinced it is the

sincere desire, of the Governments and people of the two countries to

be on terms of intimate friendship with each other, it has been our

misfortune almost always to have had some irritating, if not dangerous,

outstanding question with Great Britain.

Since the origin of the Government we have been employed in negotiating

treaties with that power, and afterwards in discussing their true intent

and meaning. In this respect the convention of April 19, 1850, commonly

called the Clayton and Bulwer treaty, has been the most unfortunate

of all, because the two Governments place directly opposite and

contradictory constructions upon its first and most important article.

Whilst in the United States we believed that this treaty would place

both powers upon an exact equality by the stipulation that neither will

ever "occupy, or fortify, or colonize, or assume, or exercise any

dominion" over any part of Central America, it is contended by the

British Government that the true construction of this language has left

them in the rightful possession of all that portion of Central America

which was in their occupancy at the date of the treaty; in fact, that

the treaty is a virtual recognition on the part of the United States of

the right of Great Britain, either as owner or protector, to the whole

extensive coast of Central America, sweeping round from the Rio Hondo to

the port and harbor of San Juan de Nicaragua, together with the adjacent

Bay Islands, except the comparatively small portion of this between the

Sarstoon and Cape Honduras. According to their construction, the treaty

does no more than simply prohibit them from extending their possessions

in Central America beyond the present limits. It is not too much to

assert that if in the United States the treaty had been considered

susceptible of such a construction it never would have been negotiated

under the authority of the President, nor would it have received the

approbation of the Senate. The universal conviction in the United States

was that when our Government consented to violate its traditional and

time-honored policy and to stipulate with a foreign government never to

occupy or acquire territory in the Central American portion of our own

continent, the consideration for this sacrifice was that Great Britain

should, in this respect at least, be placed in the same position with

ourselves. Whilst we have no right to doubt the sincerity of the British

Government in their construction of the treaty, it is at the same time

my deliberate conviction that this construction is in opposition both

to its letter and its spirit.

Under the late Administration negotiations were instituted between

the two Governments for the purpose, if possible, of removing these

difficulties, and a treaty having this laudable object in view was

signed at London on the 17th October, 1856, and was submitted by the

President to the Senate on the following 10th of December. Whether

this treaty, either in its original or amended form, would have

accomplished the object intended without giving birth to new and

embarrassing complications between the two Governments, may perhaps

be well questioned. Certain it is, however, it was rendered much less

objectionable by the different amendments made to it by the Senate. The

treaty as amended was ratified by me on the 12th March, 1857, and was

transmitted to London for ratification by the British Government. That

Government expressed its willingness to concur in all the amendments

made by the Senate with the single exception of the clause relating to

Ruatan and the other islands in the Bay of Honduras. The article in the

original treaty as submitted to the Senate, after reciting that these

islands and their inhabitants "having been, by a convention bearing date

the 27th day of August, 1856, between Her Britannic Majesty and the

Republic of Honduras, constituted and declared a free territory under

the sovereignty of the said Republic of Honduras," stipulated that

"the two contracting parties do hereby mutually engage to recognize

and respect in all future time the independence and rights of the said

free territory as a part of the Republic of Honduras."

Upon an examination of this convention between Great Britain and

Honduras of the 27th August, 1856, it was found that whilst declaring

the Bay Islands to be "a free territory under the sovereignty of the

Republic of Honduras" it deprived that Republic of rights without which

its sovereignty over them could scarcely be said to exist. It divided

them from the remainder of Honduras and gave to their inhabitants a

separate government of their own, with legislative, executive, and

judicial officers elected by themselves. It deprived the Government of

Honduras of the taxing power in every form and exempted the people of

the islands from the performance of military duty except for their

own exclusive defense. It also prohibited that Republic from erecting

fortifications upon them for their protection, thus leaving them open

to invasion from any quarter; and, finally, it provided "that slavery

shall not at any time hereafter be permitted to exist therein."

Had Honduras ratified this convention, she would have ratified the

establishment of a state substantially independent within her own

limits, and a state at all times subject to British influence and

control. Moreover, had the United States ratified the treaty with Great

Britain in its original form, we should have been bound "to recognize

and respect in all future time" these stipulations to the prejudice of

Honduras. Being in direct opposition to the spirit and meaning of the

Clayton and Bulwer treaty as understood in the United States, the Senate

rejected the entire clause, and substituted in its stead a simple

recognition of the sovereign right of Honduras to these islands in

the following language:

The two contracting parties do hereby mutually engage to recognize and

respect the islands of Ruatan, Bonaco, Utila, Barbaretta, Helena, and

Morat, situate in the Bay of Honduras and off the coast of the Republic

of Honduras, as under the sovereignty and as part of the said Republic

of Honduras.

Great Britain rejected this amendment, assigning as the only reason that

the ratifications of the convention of the 27th August, 1856, between

her and Honduras had not been "exchanged, owing to the hesitation of

that Government." Had this been done, it is stated that "Her Majesty's

Government would have had little difficulty in agreeing to the

modification proposed by the Senate, which then would have had in effect

the same signification as the original wording." Whether this would have

been the effect, whether the mere circumstance of the exchange of the

ratifications of the British convention with Honduras prior in point

of time to the ratification of our treaty with Great Britain would "in

effect" have had "the same signification as the original wording," and

thus have nullified the amendment of the Senate, may well be doubted.

It is, perhaps, fortunate that the question has never arisen.

The British Government, immediately after rejecting the treaty as

amended, proposed to enter into a new treaty with the United States,

similar in all respects to the treaty which they had just refused to

ratify, if the United States would consent to add to the Senate's clear

and unqualified recognition of the sovereignty of Honduras over the Bay

Islands the following conditional stipulation:

Whenever and so soon as the Republic of Honduras shall have concluded

and ratified a treaty with Great Britain by which Great Britain shall

have ceded and the Republic of Honduras shall have accepted the said

islands, subject to the provisions and conditions contained in such

treaty.

This proposition was, of course, rejected. After the Senate had refused

to recognize the British convention with Honduras of the 27th August,

1856, with full knowledge of its contents, it was impossible for me,

necessarily ignorant of "the provisions and conditions" which might be

contained in a future convention between the same parties, to sanction

them in advance.

The fact is that when two nations like Great Britain and the United

States, mutually desirous, as they are, and I trust ever may be,

of maintaining the most friendly relations with each other, have

unfortunately concluded a treaty which they understand in senses

directly opposite, the wisest course is to abrogate such a treaty by

mutual consent and to commence anew. Had this been done promptly,

all difficulties in Central America would most probably ere this have

been adjusted to the satisfaction of both parties. The time spent in

discussing the meaning of the Clayton and Bulwer treaty would have been

devoted to this praiseworthy purpose, and the task would have been the

more easily accomplished because the interest of the two countries in

Central America is identical, being confined to securing safe transits

over all the routes across the Isthmus.

Whilst entertaining these sentiments, I shall, nevertheless, not refuse

to contribute to any reasonable adjustment of the Central American

questions which is not practically inconsistent with the American

interpretation of the treaty. Overtures for this purpose have been

recently made by the British Government in a friendly spirit, which I

cordially reciprocate, but whether this renewed effort will result in

success I am not yet prepared to express an opinion. A brief period will

determine.

With France our ancient relations of friendship still continue to exist.

The French Government have in several recent instances, which need not

be enumerated, evinced a spirit of good will and kindness toward our

country, which I heartily reciprocate. It is, notwithstanding, much to

be regretted that two nations whose productions are of such a character

as to invite the most extensive exchanges and freest commercial

intercourse should continue to enforce ancient and obsolete restrictions

of trade against each other. Our commercial treaty with France is in

this respect an exception from our treaties with all other commercial

nations. It jealously levies discriminating duties both on tonnage and

on articles the growth, produce, or manufacture of the one country when

arriving in vessels belonging to the other.

More than forty years ago, on the 3d March, 1815, Congress passed an act

offering to all nations to admit their vessels laden with their national

productions into the ports of the United States upon the same terms

with our own vessels provided they would reciprocate to us similar

advantages. This act confined the reciprocity to the productions of

the respective foreign nations who might enter into the proposed

arrangement with the United States. The act of May 24, 1828, removed

this restriction and offered a similar reciprocity to all such vessels

without reference to the origin of their cargoes. Upon these principles

our commercial treaties and arrangements have been founded, except with

France, and let us hope that this exception may not long exist.

Our relations with Russia remain, as they have ever been, on the most

friendly footing. The present Emperor, as well as his predecessors, have

never failed when the occasion offered to manifest their good will to

our country, and their friendship has always been highly appreciated by

the Government and people of the United States.

With all other European Governments, except that of Spain, our relations

are as peaceful as we could desire. I regret to say that no progress

whatever has been made since the adjournment of Congress toward the

settlement of any of the numerous claims of our citizens against the

Spanish Government. Besides, the outrage committed on our flag by the

Spanish war frigate _Ferrolana_ on the high seas off the coast of

Cuba in March, 1855, by firing into the American mail steamer _El

Dorado_ and detaining and searching her, remains unacknowledged and

unredressed. The general tone and temper of the Spanish Government

toward that of the United States are much to be regretted. Our present

envoy extraordinary and minister plenipotentiary to Madrid has asked to

be recalled, and it is my purpose to send out a new minister to Spain

with special instructions on all questions pending between the two

Governments, and with a determination to have them speedily and amicably

adjusted if this be possible. In the meantime, whenever our minister

urges the just claims of our citizens on the notice of the Spanish

Government he is met with the objection that Congress has never made the

appropriation recommended by President Polk in his annual message of

December, 1847, "to be paid to the Spanish Government for the purpose of

distribution among the claimants in the _Amistad_ case." A similar

recommendation was made by my immediate predecessor in his message of

December, 1853, and entirely concurring with both in the opinion that

this indemnity is justly due under the treaty with Spain of the 27th

of October, 1795, I earnestly recommend such an appropriation to the

favorable consideration of Congress.

A treaty of friendship and commerce was concluded at Constantinople

on the 13th December, 1856, between the United States and Persia, the

ratifications of which were exchanged at Constantinople on the 13th

June, 1857, and the treaty was proclaimed by the President on the 18th

August, 1857. This treaty, it is believed, will prove beneficial to

American commerce. The Shah has manifested an earnest disposition to

cultivate friendly relations with our country, and has expressed a

strong wish that we should be represented at Teheran by a minister

plenipotentiary; and I recommend that an appropriation be made for

this purpose.

Recent occurrences in China have been unfavorable to a revision of the

treaty with that Empire of the 3d July, 1844, with a view to the

security and extension of our commerce. The twenty-fourth article of

this treaty stipulated for a revision of it in case experience should

prove this to be requisite, "in which case the two Governments will, at

the expiration of twelve years from the date of said convention, treat,

amicably concerning the same by means of suitable persons appointed to

conduct such negotiations." These twelve years expired on the 3d July,

1856, but long before that period it was ascertained that important

changes in the treaty were necessary, and several fruitless attempts

were made by the commissioner of the United States to effect these

changes. Another effort was about to be made for the same purpose by our

commissioner in conjunction with the ministers of England and France,

but this was suspended by the occurrence of hostilities in the Canton

River between Great Britain and the Chinese Empire. These hostilities

have necessarily interrupted the trade of all nations with Canton, which

is now in a state of blockade, and have occasioned a serious loss of

life and property. Meanwhile the insurrection within the Empire against

the existing imperial dynasty still continues, and it is difficult to

anticipate what will be the result.

Under these circumstances I have deemed it advisable to appoint a

distinguished citizen of Pennsylvania envoy extraordinary and minister

plenipotentiary to proceed to China and to avail himself of any

opportunities which may offer to effect changes in the existing treaty

favorable to American commerce. He left the United States for the place

of his destination in July last in the war steamer _Minnesota_. Special

ministers to China have also been appointed by the Governments of Great

Britain and France.

Whilst our minister has been instructed to occupy a neutral position

in reference to the existing hostilities at Canton, he will cordially

cooperate with the British and French ministers in all peaceful measures

to secure by treaty stipulations those just concessions to commerce

which the nations of the world have a right to expect and which China

can not long be permitted to withhold. From assurances received I

entertain no doubt that the three ministers will act in harmonious

concert to obtain similar commercial treaties for each of the powers

they represent.

We can not fail to feel a deep interest in all that concerns the welfare

of the independent Republics on our own continent, as well as of the

Empire of Brazil.

Our difficulties with New Granada, which a short time since bore so

threatening an aspect, are, it is to be hoped, in a fair train of

settlement in a manner just and honorable to both parties.

The isthmus of Central America, including that of Panama, is the great

highway between the Atlantic and Pacific over which a large portion of

the commerce of the world is destined to pass. The United States are

more deeply interested than any other nation in preserving the freedom

and security of all the communications across this isthmus. It is our

duty, therefore, to take care that they shall not be interrupted either

by invasions from our own country or by wars between the independent

States of Central America. Under our treaty with New Granada of the 12th

December, 1846, we are bound to guarantee the neutrality of the Isthmus

of Panama, through which the Panama Railroad passes, "as well as the

rights of sovereignty and property which New Granada has and possesses

over the said territory." This obligation is founded upon equivalents

granted by the treaty to the Government and people of the United States.

Under these circumstances I recommend to Congress the passage of an act

authorizing the President, in case of necessity, to employ the land and

naval forces of the United States to carry into effect this guaranty of

neutrality and protection. I also recommend similar legislation for the

security of any other route across the Isthmus in which we may acquire

an interest by treaty.

With the independent Republics on this continent it is both our duty and

our interest to cultivate the most friendly relations. We can never feel

indifferent to their fate, and must always rejoice in their prosperity.

Unfortunately both for them and for us, our example and advice have lost

much of their influence in consequence of the lawless expeditions which

have been fitted out against some of them within the limits of our

country. Nothing is better calculated to retard our steady material

progress or impair our character as a nation than the toleration of

such enterprises in violation of the law of nations.

It is one of the first and highest duties of any independent state

in its relations with the members of the great family of nations to

restrain its people from acts of hostile aggression against their

citizens or subjects. The most eminent writers on public law do not

hesitate to denounce such hostile acts as robbery and murder.

Weak and feeble states like those of Central America may not feel

themselves able to assert and vindicate their rights. The case would be

far different if expeditions were set on foot within our own territories

to make private war against a powerful nation. If such expeditions

were fitted out from abroad against any portion of our own country,

to burn down our cities, murder and plunder our people, and usurp our

Government, we should call any power on earth to the strictest account

for not preventing such enormities.

Ever since the Administration of General Washington acts of Congress

have been enforced to punish severely the crime of setting on foot a

military expedition within the limits of the United States to proceed

from thence against a nation or state with whom we are at peace. The

present neutrality act of April 20, 1818, is but little more than

a collection of preexisting laws. Under this act the President is

empowered to employ the land and naval forces and the militia "for

the purpose of preventing the carrying on of any such expedition or

enterprise from the territories and jurisdiction of the United States,"

and the collectors of customs are authorized and required to detain any

vessel in port when there is reason to believe she is about to take part

in such lawless enterprises.

When it was first rendered probable that an attempt would be made to get

up another unlawful expedition against Nicaragua, the Secretary of State

issued instructions to the marshals and district attorneys, which were

directed by the Secretaries of War and the Navy to the appropriate army

and navy officers, requiring them to be vigilant and to use their best

exertions in carrying into effect the provisions of the act of 1818.

Notwithstanding these precautions, the expedition has escaped from our

shores. Such enterprises can do no possible good to the country, but

have already inflicted much injury both on its interests and its

character. They have prevented peaceful emigration from the United

States to the States of Central America, which could not fail to prove

highly beneficial to all the parties concerned. In a pecuniary point of

view alone our citizens have sustained heavy losses from the seizure and

closing of the transit route by the San Juan between the two oceans.

The leader of the recent expedition was arrested at New Orleans, but

was discharged on giving bail for his appearance in the insufficient

sum of $2,000.

I commend the whole subject to the serious attention of Congress,

believing that our duty and our interest, as well as our national

character, require that we should adopt such measures as will be

effectual in restraining our citizens from committing such outrages.

I regret to inform you that the President of Paraguay has refused to

ratify the treaty between the United States and that State as amended by

the Senate, the signature of which was mentioned in the message of my

predecessor to Congress at the opening of its session in December, 1853.

The reasons assigned for this refusal will appear in the correspondence

herewith submitted.

It being desirable to ascertain the fitness of the river La Plata and

its tributaries for navigation by steam, the United States steamer

_Water Witch_ was sent thither for that purpose in 1853. This enterprise

was successfully carried on until February, 1855, when, whilst in the

peaceful prosecution of her voyage up the Parana River, the steamer

was fired upon by a Paraguayan fort. The fire was returned, but as

the _Water Witch_ was of small force and not designed for offensive

operations, she retired from the conflict. The pretext upon which the

attack was made was a decree of the President of Paraguay of October,

1854, prohibiting foreign vessels of war from navigating the rivers of

that State. As Paraguay, however, was the owner of but one bank of the

river of that name, the other belonging to Corientes, a State of the

Argentine Confederation, the right of its Government to expect that such

a decree would be obeyed can not be acknowledged. But the _Water Witch_

was not, properly speaking, a vessel of war. She was a small steamer

engaged in a scientific enterprise intended for the advantage of

commercial states generally. Under these circumstances I am constrained

to consider the attack upon her as unjustifiable and as calling for

satisfaction from the Paraguayan Government.

Citizens of the United States also who were established in business in

Paraguay have had their property seized and taken from them, and have

otherwise been treated by the authorities in an insulting and arbitrary

manner, which requires redress.

A demand for these purposes will be made in a firm but conciliatory

spirit. This will the more probably be granted if the Executive shall

have authority to use other means in the event of a refusal. This is

accordingly recommended.

It is unnecessary to state in detail the alarming condition of the

Territory of Kansas at the time of my inauguration. The opposing parties

then stood in hostile array against each other, and any accident might

have relighted the flames of civil war. Besides, at this critical moment

Kansas was left without a governor by the resignation of Governor Geary.

On the 19th of February previous the Territorial legislature had passed

a law providing for the election of delegates on the third Monday of

June to a convention to meet on the first Monday of September for the

purpose of framing a constitution preparatory to admission into the

Union. This law was in the main fair and just, and it is to be regretted

that all the qualified electors had not registered themselves and voted

under its provisions.

At the time of the election for delegates an extensive organization

existed in the Territory whose avowed object it was, if need be, to put

down the lawful government by force and to establish a government of

their own under the so-called Topeka constitution. The persons attached

to this revolutionary organization abstained from taking any part in the

election.

The act of the Territorial legislature had omitted to provide for

submitting to the people the constitution which might be framed by the

convention, and in the excited state of public feeling throughout Kansas

an apprehension extensively prevailed that a design existed to force

upon them a constitution in relation to slavery against their will.

In this emergency it became my duty, as it was my unquestionable

right, having in view the union of all good citizens in support of the

Territorial laws, to express an opinion on the true construction of the

provisions concerning slavery contained in the organic act of Congress

of the 30th May, 1854. Congress declared it to be "the true intent and

meaning of this act not to legislate slavery into any Territory or

State, nor to exclude it therefrom, but to leave the people thereof

perfectly free to form and regulate their domestic institutions in their

own way." Under it Kansas, "when admitted as a State," was to "be

received into the Union with or without slavery, as their constitution

may prescribe at the time of their admission."

Did Congress mean by this language that the delegates elected to frame

a constitution should have authority finally to decide the question of

slavery, or did they intend by leaving it to the people that the people

of Kansas themselves should decide this question by a direct vote? On

this subject I confess I had never entertained a serious doubt, and

therefore in my instructions to Governor Walker of the 28th March last

I merely said that when "a constitution shall be submitted to the people

of the Territory they must be protected in the exercise of their right

of voting for or against that instrument, and the fair expression of the

popular will must not be interrupted by fraud or violence."

In expressing this opinion it was far from my intention to interfere

with the decision of the people of Kansas, either for or against

slavery. From this I have always carefully abstained. Intrusted with the

duty of taking "care that the laws be faithfully executed," my only

desire was that the people of Kansas should furnish to Congress the

evidence required by the organic act, whether for or against slavery,

and in this manner smooth their passage into the Union. In emerging from

the condition of Territorial dependence into that of a sovereign State

it was their duty, in my opinion, to make known their will by the votes

of the majority on the direct question whether this important domestic

institution should or should not continue to exist. Indeed, this was

the only possible mode in which their will could be authentically

ascertained.

The election of delegates to a convention must necessarily take place in

separate districts. From this cause it may readily happen, as has often

been the case, that a majority of the people of a State or Territory are

on one side of a question, whilst a majority of the representatives from

the several districts into which it is divided may be upon the other

side. This arises from the fact that in some districts delegates may

be elected by small majorities, whilst in others those of different

sentiments may receive majorities sufficiently great not only to

overcome the votes given for the former, but to leave a large majority

of the whole people in direct opposition to a majority of the delegates.

Besides, our history proves that influences may be brought to bear on

the representative sufficiently powerful to induce him to disregard the

will of his constituents. The truth is that no other authentic and

satisfactory mode exists of ascertaining the will of a majority of the

people of any State or Territory on an important and exciting question

like that of slavery in Kansas except by leaving it to a direct vote.

How wise, then, was it for Congress to pass over all subordinate and

intermediate agencies and proceed directly to the source of all

legitimate power under our institutions!

How vain would any other principle prove in practice! This may be

illustrated by the case of Kansas. Should she be admitted into the Union

with a constitution either maintaining or abolishing slavery against

the sentiment of the people, this could have no other effect than to

continue and to exasperate the existing agitation during the brief

period required to make the constitution conform to the irresistible

will of the majority.

The friends and supporters of the Nebraska and Kansas act, when

struggling on a recent occasion to sustain its wise provisions before

the great tribunal of the American people, never differed about its true

meaning on this subject. Everywhere throughout the Union they publicly

pledged their faith and their honor that they would cheerfully submit

the question of slavery to the decision of the _bona fide_ people of

Kansas, without any restriction or qualification whatever. All were

cordially united upon the great doctrine of popular sovereignty, which

is the vital principle of our free institutions. Had it then been

insinuated from any quarter that it would be a sufficient compliance

with the requisitions of the organic law for the members of a convention

thereafter to be elected to withhold the question of slavery from

the people and to substitute their own will for that of a legally

ascertained majority of all their constituents, this would have been

instantly rejected. Everywhere they remained true to the resolution

adopted on a celebrated occasion recognizing "the right of the people of

all the Territories, including Kansas and Nebraska, acting through the

legally and fairly expressed will of a majority of actual residents,

and whenever the number of their inhabitants justifies it, to form a

constitution with or without slavery and be admitted into the Union upon

terms of perfect equality with the other States."

The convention to frame a constitution for Kansas met on the first

Monday of September last. They were called together by virtue of an

act of the Territorial legislature, whose lawful existence had been

recognized by Congress in different forms and by different enactments.

A large proportion of the citizens of Kansas did not think proper to

register their names and to vote at the election for delegates; but an

opportunity to do this having been fairly afforded, their refusal to

avail themselves of their right could in no manner affect the legality

of the convention.

This convention proceeded to frame a constitution for Kansas, and

finally adjourned on the 7th day of November. But little difficulty

occurred in the convention except on the subject of slavery. The truth

is that the general provisions of our recent State constitutions are

so similar and, I may add, so excellent that the difference between

them is not essential. Under the earlier practice of the Government no

constitution framed by the convention of a Territory preparatory to its

admission into the Union as a State had been submitted to the people.

I trust, however, the example set by the last Congress, requiring that

the constitution of Minnesota "should be subject to the approval and

ratification of the people of the proposed State," may be followed on

future occasions. I took it for granted that the convention of Kansas

would act in accordance with this example, founded, as it is, on correct

principles, and hence my instructions to Governor Walker in favor of

submitting the constitution to the people were expressed in general and

unqualified terms.

In the Kansas-Nebraska act, however, this requirement, as applicable to

the whole constitution, had not been inserted, and the convention were

not bound by its terms to submit any other portion of the instrument to

an election except that which relates to the "domestic institution"

of slavery. This will be rendered clear by a simple reference to its

language. It was "not to legislate slavery into any Territory or State,

nor to exclude it therefrom, but to leave the people thereof perfectly

free to form and regulate their domestic institutions in their own way."

According to the plain construction of the sentence, the words "domestic

institutions" have a direct, as they have an appropriate, reference to

slavery. "Domestic institutions" are limited to the family The relation

between master and slave and a few others are "domestic institutions,"

and are entirely distinct from institutions of a political character.

Besides, there was no question then before Congress, nor, indeed, has

there since been any serious question before the people of Kansas or

the country, except that which relates to the "domestic institution"

of slavery.

The convention, after an angry and excited debate, finally determined,

by a majority of only two, to submit the question of slavery to the

people, though at the last forty-three of the fifty delegates present

affixed their signatures to the constitution.

A large majority of the convention were in favor of establishing slavery

in Kansas. They accordingly inserted an article in the constitution for

this purpose similar in form to those which had been adopted by other

Territorial conventions. In the schedule, however, providing for the

transition from a Territorial to a State government the question has

been fairly and explicitly referred to the people whether they will have

a constitution "with or without slavery." It declares that before the

constitution adopted by the convention "shall be sent to Congress for

admission into the Union as a State" an election shall be held to decide

this question, at which all the white male inhabitants of the Territory

above the age of 21 are entitled to vote. They are to vote by ballot,

and "the ballots cast at said election shall be indorsed 'constitution

with slavery' and 'constitution with no slavery.'" If there be a

majority in favor of the "constitution with slavery," then it is to

be transmitted to Congress by the president of the convention in its

original form; if, on the contrary, there shall be a majority in favor

of the "constitution with no slavery," "then the article providing for

slavery shall be stricken from the constitution by the president of this

convention;" and it is expressly declared that "no slavery shall exist

in the State of Kansas, except that the right of property in slaves now

in the Territory shall in no manner be interfered with;" and in that

event it is made his duty to have the constitution thus ratified

transmitted to the Congress of the United States for the admission of

the State into the Union.

At this election every citizen will have an opportunity of expressing

his opinion by his vote "whether Kansas shall be received into the

Union with or without slavery," and thus this exciting question may be

peacefully settled in the very mode required by the organic law. The

election will be held under legitimate authority, and if any portion of

the inhabitants shall refuse to vote, a fair opportunity to do so having

been presented, this will be their own voluntary act and they alone will

be responsible for the consequences.

Whether Kansas shall be a free or a slave State must eventually, under

some authority, be decided by an election; and the question can never

be more clearly or distinctly presented to the people than it is at the

present moment. Should this opportunity be rejected she may be involved

for years in domestic discord, and possibly in civil war, before she can

again make up the issue now so fortunately tendered and again reach the

point she has already attained.

Kansas has for some years occupied too much of the public attention.

It is high time this should be directed to far more important objects.

When once admitted into the Union, whether with or without slavery, the

excitement beyond her own limits will speedily pass away, and she will

then for the first time be left, as she ought to have been long since,

to manage her own affairs in her own way. If her constitution on the

subject of slavery or on any other subject be displeasing to a majority

of the people, no human power can prevent them from changing it within

a brief period. Under these circumstances it may well be questioned

whether the peace and quiet of the whole country are not of greater

importance than the mere temporary triumph of either of the political

parties in Kansas.

Should the constitution without slavery be adopted by the votes of the

majority, the rights of property in slaves now in the Territory are

reserved. The number of these is very small, but if it were greater the

provision would be equally just and reasonable. The slaves were brought

into the Territory under the Constitution of the United States and are

now the property of their masters. This point has at length been finally

decided by the highest judicial tribunal of the country, and this upon

the plain principle that when a confederacy of sovereign States acquire

a new territory at their joint expense both equality and justice demand

that the citizens of one and all of them shall have the right to take

into it whatsoever is recognized as property by the common Constitution.

To have summarily confiscated the property in slaves already in the

Territory would have been an act of gross injustice and contrary to the

practice of the older States of the Union which have abolished slavery.

A Territorial government was established for Utah by act of Congress

approved the 9th September, 1850, and the Constitution and laws of the

United States were thereby extended over it "so far as the same or any

provisions thereof may be applicable." This act provided for the

appointment by the President, by and with the advice and consent of the

Senate, of a governor (who was to be _ex officio_ superintendent of

Indian affairs), a secretary, three judges of the supreme court, a

marshal, and a district attorney. Subsequent acts provided for the

appointment of the officers necessary to extend our land and our Indian

system over the Territory. Brigham Young was appointed the first

governor on the 20th September, 1850, and has held the office ever

since. Whilst Governor Young has been both governor and superintendent

of Indian affairs throughout this period, he has been at the same time

the head of the church called the Latter-day Saints, and professes to

govern its members and dispose of their property by direct inspiration

and authority from the Almighty. His power has been, therefore, absolute

over both church and state.

The people of Utah almost exclusively belong to this church, and

believing with a fanatical spirit that he is governor of the Territory

by divine appointment, they obey his commands as if these were direct

revelations from Heaven. If, therefore, he chooses that his government

shall come into collision with the Government of the United States, the

members of the Mormon Church will yield implicit obedience to his will.

Unfortunately, existing facts leave but little doubt that such is his

determination. Without entering upon a minute history of occurrences,

it is sufficient to say that all the officers of the United States,

judicial and executive, with the single exception of two Indian agents,

have found it necessary for their own personal safety to withdraw from

the Territory, and there no longer remains any government in Utah but

the despotism of Brigham Young. This being the condition of affairs in

the Territory, I could not mistake the path of duty. As Chief Executive

Magistrate I was bound to restore the supremacy of the Constitution and

laws within its limits. In order to effect this purpose, I appointed a

new governor and other Federal officers for Utah and sent with them a

military force for their protection and to aid as a _posse comitatus_

in case of need in the execution of the laws.

With the religious opinions of the Mormons, as long as they remained

mere opinions, however deplorable in themselves and revolting to the

moral and religious sentiments of all Christendom, I had no right to

interfere. Actions alone, when in violation of the Constitution and

laws of the United States, become the legitimate subjects for the

jurisdiction of the civil magistrate. My instructions to Governor

Cumming have therefore been framed in strict accordance with these

principles. At their date a hope was indulged that no necessity might

exist for employing the military in restoring and maintaining the

authority of the law, but this hope has now vanished. Governor Young has

by proclamation declared his determination to maintain his power by

force, and has already committed acts of hostility against the United

States. Unless he should retrace his steps the Territory of Utah will be

in a state of open rebellion. He has committed these acts of hostility

notwithstanding Major Van Vliet, an officer of the Army, sent to Utah

by the Commanding General to purchase provisions for the troops, had

given him the strongest assurances of the peaceful intentions of the

Government, and that the troops would only be employed as a _posse

comitatus_ when called on by the civil authority to aid in the execution

of the laws.

There is reason to believe that Governor Young has long contemplated

this result. He knows that the continuance of his despotic power depends

upon the exclusion of all settlers from the Territory except those who

will acknowledge his divine mission and implicitly obey his will,

and that an enlightened public opinion there would soon prostrate

institutions at war with the laws both of God and man. He has therefore

for several years, in order to maintain his independence, been

industriously employed in collecting and fabricating arms and munitions

of war and in disciplining the Mormons for military service. As

superintendent of Indian affairs he has had an opportunity of tampering

with the Indian tribes and exciting their hostile feelings against the

United States. This, according to our information, he has accomplished

in regard to some of these tribes, while others have remained true to

their allegiance and have communicated his intrigues to our Indian

agents. He has laid in a store of provisions for three years, which

in case of necessity, as he informed Major Van Vliet, he will conceal,

"and then take to the mountains and bid defiance to all the powers of

the Government."

A great part of all this may be idle boasting, but yet no wise

government will lightly estimate the efforts which may be inspired by

such frenzied fanaticism as exists among the Mormons in Utah. This is

the first rebellion which has existed in our Territories, and humanity

itself requires that we should put it down in such a manner that it

shall be the last. To trifle with it would be to encourage it and to

render it formidable. We ought to go there with such an imposing force

as to convince these deluded people that resistance would be vain,

and thus spare the effusion of blood. We can in this manner best

convince them that we are their friends, not their enemies. In order to

accomplish this object it will be necessary, according to the estimate

of the War Department, to raise four additional regiments; and this I

earnestly recommend to Congress. At the present moment of depression in

the revenues of the country I am sorry to be obliged to recommend such a

measure; but I feel confident of the support of Congress, cost what it

may, in suppressing the insurrection and in restoring and maintaining

the sovereignty of the Constitution and laws over the Territory of Utah.

I recommend to Congress the establishment of a Territorial government

over Arizona, incorporating with it such portions of New Mexico as they

may deem expedient. I need scarcely adduce arguments in support of this

recommendation. We are bound to protect the lives and the property of

our citizens inhabiting Arizona, and these are now without any efficient

protection. Their present number is already considerable, and is rapidly

increasing, notwithstanding the disadvantages under which they labor.

Besides, the proposed Territory is believed to be rich in mineral and

agricultural resources, especially in silver and copper. The mails of

the United States to California are now carried over it throughout its

whole extent, and this route is known to be the nearest and believed to

be the best to the Pacific.

Long experience has deeply convinced me that a strict construction of

the powers granted to Congress is the only true, as well as the only

safe, theory of the Constitution. Whilst this principle shall guide my

public conduct, I consider it clear that under the war-making power

Congress may appropriate money for the construction of a military road

through the Territories of the United States when this is absolutely

necessary for the defense of any of the States against foreign invasion.

The Constitution has conferred upon Congress power "to declare war," "to

raise and support armies," "to provide and maintain a navy," and to call

forth the militia to "repel invasions." These high sovereign powers

necessarily involve important and responsible public duties, and among

them there is none so sacred and so imperative as that of preserving

our soil from the invasion of a foreign enemy. The Constitution has

therefore left nothing on this point to construction, but expressly

requires that "the United States shall protect each of them [the States]

against invasion." Now if a military road over our own Territories be

indispensably necessary to enable us to meet and repel the invader, it

follows as a necessary consequence not only that we possess the power,

but it is our imperative duty to construct such a road. It would be an

absurdity to invest a government with the unlimited power to make and

conduct war and at the same time deny to it the only means of reaching

and defeating the enemy at the frontier. Without such a road it is quite

evident we can not "protect" California and our Pacific possessions

"against invasion." We can not by any other means transport men and

munitions of war from the Atlantic States in sufficient time successfully

to defend these remote and distant portions of the Republic.

Experience has proved that the routes across the isthmus of Central

America are at best but a very uncertain and unreliable mode of

communication. But even if this were not the case, they would at once

be closed against us in the event of war with a naval power so much

stronger than our own as to enable it to blockade the ports at either

end of these routes. After all, therefore, we can only rely upon a

military road through our own Territories; and ever since the origin

of the Government Congress has been in the practice of appropriating

money from the public Treasury for the construction of such roads.

The difficulties and the expense of constructing a military railroad to

connect our Atlantic and Pacific States have been greatly exaggerated.

The distance on the Arizona route, near the thirty-second parallel of

north latitude, between the western boundary of Texas, on the Rio

Grande, and the eastern boundary of California, on the Colorado, from

the best explorations now within our knowledge, does not exceed 470

miles, and the face of the country is in the main favorable. For obvious

reasons the Government ought not to undertake the work itself by means

of its own agents. This ought to be committed to other agencies, which

Congress might assist, either by grants of land or money, or by both,

upon such terms and conditions as they may deem most beneficial for the

country. Provision might thus be made not only for the safe, rapid, and

economical transportation of troops and munitions of war, but also of

the public mails. The commercial interests of the whole country, both

East and West, would be greatly promoted by such a road, and, above all,

it would be a powerful additional bond of union. And although advantages

of this kind, whether postal, commercial, or political, can not confer

constitutional power, yet they may furnish auxiliary arguments in favor

of expediting a work which, in my judgment, is clearly embraced within

the war-making power.

For these reasons I commend to the friendly consideration of Congress

the subject of the Pacific Railroad, without finally committing myself

to any particular route.

The report of the Secretary of the Treasury will furnish a detailed

statement of the condition of the public finances and of the respective

branches of the public service devolved upon that Department of the

Government. By this report it appears that the amount of revenue

received from all sources into the Treasury during the fiscal year

ending the 30th June, 1857, was $68,631,513.67, which amount, with

the balance of $19,901,325.45 remaining in the Treasury at the

commencement of the year, made an aggregate for the service of the

year of $88,532,839.12.

The public expenditures for the fiscal year ending 30th June, 1857,

amounted to $70,822,724.85, of which $5,943,896.91 were applied to the

redemption of the public debt, including interest and premium, leaving

in the Treasury at the commencement of the present fiscal year, on the

1st July, 1857, $17,710,114.27.

The receipts into the Treasury for the first quarter of the present fiscal

year, commencing 1st July, 1857, were $20,929,819.81, and the estimated

receipts of the remaining three quarters to the 30th June, 1858,

are $36,750,000, making, with the balance before stated, an aggregate of

$75,389,934.08 for the service of the present fiscal year.

The actual expenditures during the first quarter of the present fiscal

year were $23,714,528.37, of which $3,895,232.39 were applied to the

redemption of the public debt, including interest and premium. The

probable expenditures of the remaining three quarters to 30th June,

1858, are $51,248,530.04, including interest on the public debt, making

an aggregate of $74,963,058.41, leaving an estimated balance in the

Treasury at the close of the present fiscal year of $426,875.67.

The amount of the public debt at the commencement of the present

fiscal year was $29,060,386.90.

The amount redeemed since the 1st of July was $3,895,232.39, leaving

a balance unredeemed at this time of $25,165,154.51.

The amount of estimated expenditures for the remaining three quarters

of the present fiscal year will in all probability be increased from

the causes set forth in the report of the Secretary. His suggestion,

therefore, that authority should be given to supply any temporary

deficiency by the issue of a limited amount of Treasury notes is

approved, and I accordingly recommend the passage of such a law.

As stated in the report of the Secretary, the tariff of March 3,

1857, has been in operation for so short a period of time and under

circumstances so unfavorable to a just development of its results as

a revenue measure that I should regard it as inexpedient, at least for

the present, to undertake its revision.

I transmit herewith the reports made to me by the Secretaries of War and

of the Navy, of the Interior, and of the Postmaster-General. They all

contain valuable and important information and suggestions, which I

commend to the favorable consideration of Congress.

I have already recommended the raising of four additional regiments, and

the report of the Secretary of War presents strong reasons proving this

increase of the Army under existing circumstances to be indispensable.

I would call the special attention of Congress to the recommendation of

the Secretary of the Navy in favor of the construction of ten small war

steamers of light draft. For some years the Government has been obliged

on many occasions to hire such steamers from individuals to supply its

pressing wants. At the present moment we have no armed vessel in the

Navy which can penetrate the rivers of China. We have but few which can

enter any of the harbors south of Norfolk, although many millions of

foreign and domestic commerce annually pass in and out of these harbors.

Some of our most valuable interests and most vulnerable points are thus

left exposed. This class of vessels of light draft, great speed, and

heavy guns would be formidable in coast defense. The cost of their

construction will not be great and they will require but a comparatively

small expenditure to keep them in commission. In time of peace they will

prove as effective as much larger vessels and more useful, One of them

should be at every station where we maintain a squadron, and three or

four should be constantly employed on our Atlantic and Pacific coasts.

Economy, utility, and efficiency combine to recommend them as almost

indispensable. Ten of these small vessels would be of incalculable

advantage to the naval service, and the whole cost of their construction

would not exceed $2,300,000, or $230,000 each.

The report of the Secretary of the Interior is worthy of grave

consideration. It treats of the numerous important and diversified

branches of domestic administration intrusted to him by law. Among

these the most prominent are the public lands and our relations with

the Indians.

Our system for the disposal of the public lands, originating with the

fathers of the Republic, has been improved as experience pointed the

way, and gradually adapted to the growth and settlement of our Western

States and Territories. It has worked well in practice. Already thirteen

States and seven Territories have been carved out of these lands, and

still more than a thousand millions of acres remain unsold. What a

boundless prospect this presents to our country of future prosperity

and power!

We have heretofore disposed of 363,862,464 acres of the public land.

Whilst the public lands, as a source of revenue, are of great

importance, their importance is far greater as furnishing homes for

a hardy and independent race of honest and industrious citizens who

desire to subdue and cultivate the soil. They ought to be administered

mainly with a view of promoting this wise and benevolent policy. In

appropriating them for any other purpose we ought to use even greater

economy than if they had been converted into money and the proceeds

were already in the public Treasury. To squander away this richest and

noblest inheritance which any people have ever enjoyed upon objects of

doubtful constitutionality or expediency would be to violate one of the

most important trusts ever committed to any people. Whilst I do not deny

to Congress the power, when acting _bona fide_ as a proprietor, to give

away portions of them for the purpose of increasing the value of the

remainder, yet, considering the great temptation to abuse this power,

we can not be too cautious in its exercise.

Actual settlers under existing laws are protected against other

purchasers at the public sales in their right of preemption to the

extent of a quarter section, or 160 acres, of land. The remainder may

then be disposed of at public or entered at private sale in unlimited

quantities.

Speculation has of late years prevailed to a great extent in the public

lands. The consequence has been that large portions of them have become

the property of individuals and companies, and thus the price is greatly

enhanced to those who desire to purchase for actual settlement. In order

to limit the area of speculation as much as possible, the extinction of

the Indian title and the extension of the public surveys ought only to

keep pace with the tide of emigration.

If Congress should hereafter grant alternate sections to States

or companies, as they have done heretofore, I recommend that the

intermediate sections retained by the Government should be subject

to preemption by actual settlers.

It ought ever to be our cardinal policy to reserve the public lands as

much as may be for actual settlers, and this at moderate prices. We

shall thus not only best promote the prosperity of the new States and

Territories and the power of the Union, but shall secure homes for our

posterity for many generations.

The extension of our limits has brought within our jurisdiction many

additional and populous tribes of Indians, a large proportion of which

are wild, untractable, and difficult to control. Predatory and warlike

in their disposition and habits, it is impossible altogether to restrain

them from committing aggressions on each other, as well as upon our

frontier citizens and those emigrating to our distant States and

Territories. Hence expensive military expeditions are frequently

necessary to overawe and chastise the more lawless and hostile.

The present system of making them valuable presents to influence them to

remain at peace has proved ineffectual. It is believed to be the better

policy to colonize them in suitable localities where they can receive

the rudiments of education and be gradually induced to adopt habits of

industry. So far as the experiment has been tried it has worked well

in practice, and it will doubtless prove to be less expensive than the

present system.

The whole number of Indians within our territorial limits is believed

to be, from the best data in the Interior Department, about 325,000.

The tribes of Cherokees, Choctaws, Chickasaws, and Creeks settled in the

Territory set apart for them west of Arkansas are rapidly advancing in

education and in all the arts of civilization and self-government, and

we may indulge the agreeable anticipation that at no very distant day

they will be incorporated into the Union as one of the sovereign States.

It will be seen from the report of the Postmaster-General that the

Post-Office Department still continues to depend on the Treasury, as

it has been compelled to do for several years past, for an important

portion of the means of sustaining and extending its operations. Their

rapid growth and expansion are shown by a decennial statement of the

number of post-offices and the length of post-roads, commencing with the

year 1827. In that year there were 7,000 post-offices; in 1837, 11,177;

in 1847, 15,146, and in 1857 they number 26,586. In this year 1,725

post-offices have been established and 704 discontinued, leaving a

net increase of 1,021. The postmasters of 368 offices are appointed

by the President.

The length of post-roads in 1827 was 105,336 miles; in 1837, 141,242

miles; in 1847, 153,818 miles, and in the year 1857 there are 242,601

miles of post-road, including 22,530 miles of railroad on which the mails

are transported.

The expenditures of the Department for the fiscal year ending on the

30th June, 1857, as adjusted by the Auditor, amounted to $11,507,670.

To defray these expenditures there was to the credit of the Department

on the 1st July, 1856, the sum of $789,599; the gross revenue of the

year, including the annual allowances for the transportation of free

mail matter, produced $8,053,951, and the remainder was supplied by

the appropriation from the Treasury of $2,250,000 granted by the act of

Congress approved August 18, 1856, and by the appropriation of $666,883

made by the act of March 3, 1857, leaving $252,763 to be carried to the

credit of the Department in the accounts of the current year. I commend

to your consideration the report of the Department in relation to the

establishment of the overland mail route from the Mississippi River to

San Francisco, Cal. The route was selected with my full concurrence, as

the one, in my judgment, best calculated to attain the important objects

contemplated by Congress.

The late disastrous monetary revulsion may have one good effect should

it cause both the Government and the people to return to the practice of

a wise and judicious economy both in public and private expenditures.

An overflowing Treasury has led to habits of prodigality and

extravagance in our legislation. It has induced Congress to make large

appropriations to objects for which they never would have provided had

it been necessary to raise the amount of revenue required to meet them

by increased taxation or by loans. We are now compelled to pause in our

career and to scrutinize our expenditures with the utmost vigilance;

and in performing this duty I pledge my cooperation to the extent of

my constitutional competency.

It ought to be observed at the same time that true public economy does

not consist in withholding the means necessary to accomplish important

national objects intrusted to us by the Constitution, and especially

such as may be necessary for the common defense. In the present crisis

of the country it is our duty to confine our appropriations to objects

of this character, unless in cases where justice to individuals may

demand a different course. In all cases care ought to be taken that the

money granted by Congress shall be faithfully and economically applied.

Under the Federal Constitution "every bill which shall have passed the

House of Representatives and the Senate shall, before it become a law."

be approved and signed by the President; and if not approved, "he shall

return it with his objections to that House in which it shall have

originated." In order to perform this high and responsible duty,

sufficient time must be allowed the President to read and examine

every bill presented to him for approval. Unless this be afforded,

the Constitution becomes a dead letter in this particular, and, even

worse, it becomes a means of deception. Our constituents, seeing the

President's approval and signature attached to each act of Congress,

are induced to believe that he has actually performed his duty, when

in truth nothing is in many cases more unfounded.

From the practice of Congress such an examination of each bill as the

Constitution requires has been rendered impossible. The most important

business of each session is generally crowded into its last hours, and

the alternative presented to the President is either to violate the

constitutional duty which he owes to the people and approve bills which

for want of time it is impossible he should have examined, or by his

refusal to do this subject the country and individuals to great loss

and inconvenience. Besides, a practice has grown up of late years to

legislate in appropriation bills at the last hours of the session on new

and important subjects. This practice constrains the President either

to suffer measures to become laws which he does not approve or to

incur the risk of stopping the wheels of the Government by vetoing

an appropriation bill. Formerly such bills were confined to specific

appropriations for carrying into effect existing laws and the

well-established policy of the country, and little time was then

required by the President for their examination.

For my own part, I have deliberately determined that I shall approve no

bills which I have not examined, and it will be a case of extreme and

most urgent necessity which shall ever induce me to depart from this

rule. I therefore respectfully but earnestly recommend that the two

Houses would allow the President at least two days previous to the

adjournment of each session within which no new bill shall be presented

to him for approval. Under the existing joint rule one day is allowed,

but this rule has been hitherto so constantly suspended in practice

that important bills continue to be presented to him up till the very

last moments of the session. In a large majority of cases no great

public inconvenience can arise from the want of time to examine their

provisions, because the Constitution has declared that if a bill be

presented to the President within the last ten days of the session he

is not required to return it, either with an approval or with a veto,

"in which case it shall not be a law." It may then lie over and be taken

up and passed at the next session. Great inconvenience would only be

experienced in regard to appropriation bills, but, fortunately, under

the late excellent law allowing a salary instead of a per diem to

members of Congress the expense and inconvenience of a called session

will be greatly reduced.

I can not conclude without commending to your favorable consideration

the interest of the people of this District. Without a representative on

the floor of Congress, they have for this very reason peculiar claims

upon our just regard. To this I know, from my long acquaintance with

them, they are eminently entitled.