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Natioiialllcpnblican
\ < XtUhTA. <>**•
IHI 118 DAY MOKNIND... .Dec. ,s6b
Thi» is • Republic where the Will of
the People is the Law of the Land.
|U S. Graxt.
•• Watch ortr thepittcrridion of thr Union
with zealous eye, and ittdi<jnautly .frown upon
fhr first dawnini/ of every attempt /■> alienale
anu portion of th' Country from <kc rent, or
tv rj'fi IJr M* Mend ties, which u>w link
tht carious ptirh.'' —W ARHIXGTus’s
Fare* > it. Annin -s.
Jby
iwrrj MESSAGE.
W.vsihrcton, December 9.
The following is the Message of the
President, which yas read before Congress
to-day:
/•'cUow-Citueo* of th< Senate and Ho'ise <f
ItqrmentatirrK :
Upon the reassembling of Congress.it
again becomes my duty to call your atten
tion to the state of the Union, and to its
continued disorganized condition under
the various laws which have been passed
upon the subject'of reconstruction. It
may be assumed as an axiom in the gov
ernment of the States that the greatest
wrongs inflicted upon a people arc caused
by unjust and contrary legislation, or by
the unrelenting decrees of despotic rulers;
and that the timely revocation of injurious
and oppressive measures is the greatest
good that can be conferred upon a nation.
The legislator or ruler who has the wis
dom and magnanimity to retrace Ins steps
when convinced of error, will sooner or
later be rewarded with the respect and
gratitude of an intelligent and patriotic
people. Our own history, although em
bracing a period less than a century,
affords abundant proof that most, if not
all, of our domestic troubles are directly
traceable to violations of the organic law
and excessive legislation. The most
striking illustrations of this fact arc fur
nished by the enactments of the past three
years, upon the question of reconstruction.
' After a fair trd they have substantially
failed and proved pecuniary in their re
sults, and there seems to be no good reason
why they should longer remain upon the
Statute book. States to which the Consti
tution guarantees a Republican form of
Government have been reduced to military
dependencies, in each of which the people
have been made subject to the arbitrary
willofthe Commanding General. Although
the Constitution requires that each State
shall be represented in Congress, Virginia,
Mississippi and Texas arc yet excluded
from the two Houses, and, contrary to the
express provisions in that instrument, were
denied participation in the recent election
for President and Vice-President of the
United States.
The attempt to place the white people
under the domination of persons of color,
which hns impaired, if not destroyed, the
kindly relations that had previously
existed between them, and mutual distrust
has engendered a feeling of animosity
w hich is leading in some instances to col
lision ami bloodshed, and has prevented
that co-operation between the two races
so essential to the success of industrial en
terprises of the Southern States. I save the
inhabitants of those States alone suffered
from the disturbed condition of affairs
growing out of these Congressional enact
ments I The entire Union has been agi
tated by grave apprehensions of trouble,
which might again involve the peace of
the nation. Its interests have been inju
riously affected by the derangement of
business and labor, ami the consequent
want of prosperity throughout that por
tion of the country. The Federal Consti
tution, the magna charta of American
rights, under whose wise and salutary pro
visions we have successfully conducted all
our domestic and foreign affairs, and sus
tained ourselves in peace and in war, and
become a great nation among the powers
of the earth, must assuredly lie now ade
quate to the settlement of questions grow
ing out of the civil war, waged alone for
its vindication. This great fact is made
most manifest by the condition of the
country when Congress assembled in the
month of Decemlier, 1865. The civil strife
had ceased, the spirit of the rebellion had
spent its entire force in the Southern States,
the people had warmed into national life,
and throughout the whole country a healthy
reaction in public sentiment had taken
place, by the application of the simple,
yet effective provisions of the Constitution.
The Executive Department, with the vol-
untary aid of the States, had brought the
work of restoration as near completion as
was within the scope of its authority, and
the nation was encouraged by the pros
pect of early and satisfactory adjustment
of all its difficulties. Congress, however,
intervened, and, refusing to perfect the
work so nearly consummated. declined to
admit the members from the unrepresent
ed States, adopted a series of measures
which arrested the progress of restoration,
and frustrated all that had been so suc
cessfully accomplished; and. after three
y ears of agitation and strife, left the country
farther from the attainment of Union ami
fraternal feeling than at the inception of
the Congressional plan of txtconstruction.
It needs no argument to show that the
legislation which has produced such bane
ful consequences, should be abrogated, or
else made to conform to the genuine
principles of Republican government.
Under the influence of party passion and
sectional prejudice, other acts have been
passed not warranted by the Constitu
tion.
Congress has already been made familiar
with my views respecting the Tenure of
Office Bill. Experience has proved that
its repeal is demanded by the best interest
of the country, and that while it remains
in force the President cannot enjoin that
rigid accountability of public officers so es
sential to an honest and efficient execution
of the laws. Its revocation would enable
the Executive to exercise the power of ap
pointment and removal, in accordance with
the original design of the Federal Consti
tution.
The Act of March 2d, 1867, making ap
propriations for the support of the army for
the year ending June 30, 186 b, and for
other purposes, contains provisions which
interfere with the President's Constitution
al functions as Commander in-Chics of the
Army, and deny to States of the Union the
right to protect themselves by means of
their own militia. These provisions should
beat once amended. for while the first
might, in times of great emergency, serious
ly embarass the Executive in efforts to era
ploy and direct the common strength of
the nation for its protection and preserva
tion, the other is contrary to the express
declaration of the Constitution that “a well
regulated militia being necessary to the
security of a free State, the right of the
people to keep and bear arms shall not be
infringed.” It is believed the no- *i of all
such laws would be accepted by the Ameri
can people as, at least, a partial return to
the fn*nlnment'd principle- of the Govern
ihent, and an indication that hereafter the
Constitution is to be made tin- nation * safe
and unerring guide. They can be produc
tive ot no permanent benefit to the country,
ami should not be jiertuittcd to stand asso
many tnonumeutaof the deficient wisdom
which ha* characterized our recent Jcgi*la
tion
The condition of our finances demands
the early ami honest consideration ot Con
gress. Compared with the growth ot our
population the public expenditures have
reached an amount unprecedented in our
history. Tin imputation of the United
States in 1790 tu’Jirly four million -of
people, inctea-ing each decade about 33
percent, it reached in IH6O thirty-one mil
lions—an increase of 700 per cent, on the
imputation in 1790. Tn 1869 it is estima
ted that it will reach thirty-eight million#,
or an increase of 868 per cent, in seventy
nine years. The annual expenditures ot
the Federal Government in 1791 were lour
million two hundred thousand dollars : in
1820 eighteen millions two hundred thous
and dollars; in 1850. forty-one millions : in
1860, sixty-three millions: in 1865, nearly
thirteen hundred millions, and in 1869 it
is estimated by the Secretary of the Treas
ury, in bis last annual report, that they will
be three hundred and seventy -two millions.
By comparing the public disbursements ot
1869, as estimated, with those of 1791, it
will be seen that the increase of expendi
ture since the beginning of the Government
has been eight thousand six hundred and
eighteen per centum, while the increase of
the population for the same period was only
eight hundred ami sixty-eight per centum.
Again, the expenses of the Government
in 1860, the year of peace immediately
preceding the war, were only sixty-three
millions; while in 1869, the year of peace
three years after the war, it is estimated
that they will be three hundred and
seventy-two millions—an increase of four
hundred and eighty-nine per cent., while
the increase of population was only tw enty
one per centum for the same period. These
statistics further show that in 1791. the
annual national expenses compared with
the population were little more than one
dollar per capita, and in 186(1 but two
dollars |>ei' capita; while in 1869 they will
reach the extravagant sum of nine dollars
and seventy-eight cents per capita. It will
be observed that all of these statements
refer to and exhibit the disbursements of
peace periods. It may, therefore, be of in
terest to compare, the expenditures of the
three war periods—the war with Great
Britain, the Mexican war, and the war of
the rebellion. In 1814 the annual ex
penses incident to the war of 1812 reached
their highest amount, about thirtv-onc
millions, while our population slightly ex
ceeded eight millions, showing an expen
diture of only three dollars and eighty
cents per capita. In 1847, the expendi
tures growing out of the war with Mexico
reached fifty-five millions, and the popula
tion. about twenty-one millions, giving
only two dollars and sixty cents per capita
for the war expenses of that year. In
1865, the expenditures called for by the
rebellion reached the vast amount of
twelve hundred and ninety millions, which,
compared w ith a population of thirty four
millions, gives thirty eight dollars and
twenty cents per capita. From the 4th
day of March, 1789, to the 30th of .lune,
1861; the entire expenditures of the Gov
cmmerl were seventeen hundred millions
of dollars. During that period we were
engaged in wars with Great Britain and
Mexico, and were involved in hostilities
with powerful Indian tribes.
Louisiana was purchased from France at
a costof fifteen millions of dollars. Florida
was added to us by Spain for five millions,
California was acquired from Mexico
at a cost of fifteen millions, and the terri
tory of New Mexico was obtained from
Texas for the sum ot ten millions. Early
in 1861, the war of the rebellion com
menced, and from the first of July ot that
year to the 30th of June, 1865, the public
expenditures reached the enormous aggre
gate of thirty-three hundred millions.
Three years of peace have intervened, and
during that time the disbursements ot the
Government have successively been live
hundred and twenty millions, three hun
dred and forty-six millions, and three hun
dred and ninety millions. Adding to
these amounts three hundred and seventy
two millions, estimated as necessary lor
the fiscal year ending the 30th of J une,
1860, we obtain a total expenditure ot
sixteen hundred millions ot dollars during
the four years immediately succeeding the
war, or nearly as much as was expended
during the seventy-two years that preceded
the rebellion, and embraced the extraordi
nary expenditures already named. 1 hese
startling facts clearly illustrate the neces
sity of retrenchment in all branches of the
public service.
Abuses which were tolerated during the
war for the preservation of the Nation will
not be endured by the people »ow, that
profound peace prevails. Ihe receipts
from internal revenues and chstoms have,
during the past three years, gradually
diminished, and the continuance of useless
and extravagant expenditures will involve
us in National bankruptcy, or will make
inevitable an increase of taxes, already too
onerous, and in many respects obnoxious
on account of their inquisitorial character.
One hundred millions annually are ex
pended for the military force, a large
portion of which is employed in the execu
tion of laws both unnecessary and uncon
stitutional. One hundred and fifty millions
are required each year to pay the interest
on the public debt. An army of tax-gath
. erers impoverishes the Nation, and public
agents placed by Congress beyond the
control of the Executive, divert from their
legitimate purposes large sums of money,
which they collect from the people in the
name of the Government. Judicious leg
islation and prudent economy can alone
remedy defects and avert evils which, if
suffered to exist, cannot fail to diminish
confidence in the people towards their
jxditical institutions. Without proper
care, the small balance which it estimated
will remain in the Treasury at the close of
the present fiscal year will not be realized,
and additional millions be added to a debt
which is now enumerated by billions.
* It is shown by the able and comprehen
sive report of the Secretary of the Treasury
that the receipts for the fiscal year ending
Juno 30th. 1868, were $405,638,(183, and that
the expenditures for the same period were
$376,340,284, leaving in the Treasury' a sur
plus of $28,297,789. It is estimated’that the
receipts during the present fiscal year ending
June 30th, 1869, will be $341,392,868,and the
expenditures $336,152,470, allowing a small
balance of $5,240,398 in favor of the Govern
ment. For the fiscal vear ending J une>3oth,
1870, it is estimated that the receipts amount
to $327,000,000 and the expenditures to
*303,000,000, leaving an estimated surplus of
$24,000,000. It becomes proper in this con
nection to make a brief reference to our
public intebtedness, winch has accumulated
with such alarming rapidity, and assumed
such colossal proportions.
In 1789 when the Government com
menced operations under the Federal Con
stitution it was burdened with an iudebt
edness of seventy-five millions of dollars,
created during the war of the revolution.
This aulouut had been reduced to forty
five millions of dollars, w hen, in 1812, war
was declared against Great Britain. The
three year's struggle that followed largely
iucre&sed the national obligations and in
1816 they had attained the sum of one Iran
dred and twenty-seven millions. Wise and
economical legislation, however, enabled
th*- Government to pay the entire amount
within a period of twenty yearn, ami the
extinguishment of the national debt filled
the land with rejoicing, and wasoue of the
great events of President Jackson's admin
miration. After its redemption a large fund
remained in the Treasury which was de
ported, for safe keeping, with the several
States, on condition that it should be re
turned when required by the public wants.
In 1849, the year after the termination of
an expensive war with Mexico, we found
ourselves involved in a debt of sixty-tour
million'- This was the amount owed by the
Government in 1860, just prior to the out
break ol the rebellion. .In the Spring of
1861, our civil war commenced. Each year
of its continuance made an enormous addi
tion to the debt, and when, in the Spring of
1865, the nation successfully emerged from
tin- conflict, the obligations of the Govern
ment debt had reached the immense sum of
$2,873,992,909. The Secretary of the Treas
ury shows that on the first day of Novem
ber. 1867, this amount had been reduced to
$2,491,564,450, but nt the same time his
rejiort exhibits an increase during the past
year of $35,625,102, for the debt on the first
ilav of Not ember lasi is stated to have been
$2,527,129,552. it is estimated by the Secre
tary that the returns for the past month will
add to our liabilities the further sum of
eleven millions, making a total increase
during thirteen months of forty- ix and a
half millions.
In my Message to Congress of Decemlier
4th, 1865, it was suggested that a ]x>liey
should be d< vised which, without being op
pressive to the people, would at once begin
to effect a reduction of the debt, and if per
sisted in. discharge it fully within :t definite
number of years. The Secretary ol the
Treasury forcibly recommends legislation of
this character, and justly urges that the lon
ger it is deferred the more difficult must
become its accomplishment. We should fol
low the wiseprecedentsestablishcdiu 1789 and
1816, and without further delay make pro
vision for the payment of our obligations at
as early a period as may be practicable. The
fruits of their labors should be enjoyed by
our citizens, rather than used to build up
and sustain monied metropolists in out own
anil other lands. Our foreign debt is already
computed by the Secretary of the Treasury
at eight hundred and fifty' millions. Citizens
of foreign countries receive interest upon a
large portion of our securities, and American
tax-payers arc made to contribute large sums
for their support. The idea that such a debt
is to become permanent should be at all
times discarded as involving’ taxation too
heavy to lie borne, and payment once in every
sixteen years, at the present rate of interest,
of tin amount equal to the original sum.
This vast debt, if permitted to be
ecome permanent and increasing, must
eventually be gathered into the hands
of a few. and enable them to exert a danger
ous and controlling power in the affairs of
the Government. The borrowers would be
come servants to the lenders. The lenders
the masters of the |>eople.
Wc now pride ourselves upon having given
freedom to four millions of the colored race.
It will, then, be to our shame that forty mil
lions of people, by their own toleration of
usurpation and profligacy, have suffered
themselves to become enslaved, and to have
merely exchanged slave-owners for new task
masters, in the shape of- bondholders and
tax-gatherers. Besides, permanent debts
pertain to monarchical governments, and arc
tending to monopolies, while perpetuities
and class legislation are totally irreconcilable
with free institutions. Introduced into our
Republican system, they' would gradually
but surely sap its foundation, eventually
subvert our governmental fabric, and erect
upon its ruins a monied aristocracy. It is
our sacred duty to transmit, unimpaired, to
our posterity the blessings of liberty which
were bequeathed to us by the founders of the
Republic, and, by our example, teach those
who are to follow us carefully to avoid the
dangers which threaten a free and inde
pendent people. Various plans have berm
proposed for the payment of the public
debt. However they may have varied as to
the time and mode in which it may be re
deemed. there seems to be a general concur
rence as to the propriety and justness of re
duction in the present rate of interest. The
Secretary of the Treasury, in his report,
recommends five per cent.
Congress in a bill passed prior to adjourn
ment on the 27th of July last, agreed upon
four and four and a half per cent, while by
manv three per cent, has been held to be an
amply sufficient return for the investment.
The general impression as to the exorbitancy
of the existing rate of interest has led to an
inquiry to the public mind respecting the
consideration which the Government inis
actually received for its bonds, and the con
clusion is becoming prevalent that the amount
which it obtained was in real money, three
or four hundred per cent, less than’the ob
ligations which is issued in return. It cannot
be denied that we are paying an extravagant
percentage for use of money borrowed which
was paper currency, greatly' depreciated be
low the value of coni.
This fact is made apparent when we
consider that bondholders receive from the
Treasury’, upon each,dollar they own in
Government securities, six per cent, in gold,
which is nearly or quite equal to nine per
cent, in currency. That the bonds are then
converted into capital for the national
banks, upon which those institutions issue
their circulation bearing six per cent, in
terest, and that they are exempt from tax
ation by the Government and the States,
and thereby enhanced two per cent, in the
hands of the holders. We thus have an
aggregate of seventeen percent, which may
be received upon each dollar by the owners
of Government securities. A system which
produces such results is justly regarded as
favoring a few nt the expense of the many,
and has led to the further inquiry : whether
our bondholders, in view of the large pro
fits which they have enjoyed, would them
selves be averse to a settlement of our in
debtedness upon a plan which would yield
them a fair remuneration, and at the same
time be just to the tax-payers of the nation?
Our national credit should be sacredly ob
served.
But. in making provisions for our credi
tors, we should not forget what is due to
the masses of the people. It may be as
sumed that the holders of our securities
have already received upon their bonds a
larger amount than their original invest
ment, measured by a gold standard. Upon
this statement of facts, it would seem but
just and equitable that the six per cent,
interest now paid by the Government
should be applied to the reduction of the
principal in semi-annual instalments,which,
in sixteen years and eight months, would
liquidate the entire national debt. Six
per cent, in gold would, at present rates,
be equal to nine per cent, in currency, and
equivalent to the payment of debt one and
a half times in a fraction less than seven
teen years. This, in connection with all
the advantages derived from their invest
ment, would afford to the public creditors
a fair and liberal compensation for the use
of their capital; and with this they should
be satisfied. The lessons of the past ad
monish the lender that it is not well to be
overanxious in exacting from the bor
rower rigid compliance with the letter of
the bonds.
If provision be made for the payinenUoi
the indebtedness of the Government, in the
manner suggested, our Nation will rapidly
recover its wonted prosperity. Its interests
require that some measure should be taken to
release the large amount of capital invested
in the securities of the Government. It is
now merely unproductive, but in taxation
annually consumes one hundred and fifty
millions of dollars, which would otherwise
lie used by our enterprising people in adding
to the wealth of the Nation. Out commerce,
which successfully rivalled that of the great
maraline. jtower,lms rapidly dimiiiishtil.
and our industrial interests arc’in a tlcpresM.il
and languishing condition. The develop
ment of our inexhaustible resonrees is check
ed, and the fertile fields of the South an
Itctoniing wa<te for want of nteans to till I
them. With the release of capital, new life
would l>c infused into the puralyzwl eneigics
of our |M><»ple, and activity mid vigor imputed
to every branch of industry.
Our |Hs>ple need encouragement in their
< floita to recover from the effects of the
rebellion oid <4 injudicious legislation, and
it should Ixj th*' aim of the Government to
stimulate theiu by tbc prospect of nn early
rele.i-i from the burdens which impede their
pro'peritv. If we cannot take the bunlens
from their shoulders, we should at least mani
fest a willingness to help to tear them. In
referring to the condition of the circulating
medium, 1 shall merely reiterate sutetan
cially that jtortion of my last annual mes
sage which relates to that subject. The
propirtion w hich the currency of any coun
try should bear to the whole value of the
annual produce circulated by its means is a
question upon which political economists
have not agreed nor can it be controlled by
legislation, but must lie left to the irrevoca
ble laws which everywhere regulate com
merce and trade.
Tiie circulating medium will ever irresistn
b)y How to those points where it is in
greatest demand. The law of demand and
supply is as unerring as that which regulates
the tides of (he ocean, and. indeed, currency,
like the tides, lias its ebbs and Hows through
out the commercial world. At the beginning
of the rebellion, the bank-note circulation of
the country luuounted to not much more
than two hundred millions of dollars. Now,
the circulation of national bank notes, and
(hose known as '‘legal tenders" is nearly'
seven hundred millions. While it is urged
by someihat this amount should be increased,
others contend that a decided reduction is
absolutely essential to the best interests of
the country. In view of these diverse
opinions, it may lie well to ascertain the real
value of our paper issues, when compared
with a metallic or convertible currency. For
this purpose let us inquire how much gold
and silver could be purchased by' the seven
hundred millions of paper money now in
circulation —probably not more than half the
amount of the latter,' showing that when our
paper currency' is compared with gold and
silver, its commercial value is compressed
into three hundred and fifty millions.
This striking fact makes it the obvious
duty o’ the Government, as early as maybe
convenient with the principles of sound polit
ical economy, to take such measures as will
enable the holders of its notes and those of
the National Banks to convert them, without
loss, into specie or its equivalent. A reduc
tion of our paper circulating medium need
not necessarily follow. This, however, would
depend upon the law of demand and supply,
though it should be borne in mind that by
making legal tender and bank notes converti
ble into coin or its equivalent their present
specie value, in the hands of their holders,
would be enhanced one hundred per cent.—
Legislation for the accomplishment of a result
so desirable is demanded by' the highest pub
lic considerations.
Tlie Constitution contemplates tliat the
circulating medium of the country shall be
uniform in quantity and value. At the time
of the formation of that instrument, the
country had just emerged from the war of
flic revolution, and was suffering from tlie
effects of a redundant and worthless paper
currency. The sages of that paper were
anxious to protect their posterity from the
evils which they themselves experienced.
Hence, in providing a circulating medium,
tlicy conferred upon Congress the power to
coin money and regulate Uie value thereof,
at the same time prohibiting the States from
making anything but gold and silver a tender
in payment of debts.
The anomalous condition of our curreucy
is in striking contrast with that which Was
originally designed. Our circulation now em
brace-, first, notes of the National Banks
which are receivable for all dues to the Gov
ernment. excluding imports, and by all its
creditors excepting in payment of interest
upon its bonds and tlie securities themselves;
second, Legal Tender notes issued by the
United States, and wliich the law requires
shall lie received as well in payment of all'
debts between citizens as of all Government
duos, excepting imposts; find third, gold and
silver coin. By the operations of our present
system of finance, however, the metallic cur
rency, when collected, is reserved only for
one class of Government creditors, who, hold
ing its bonds, semi-annually receive their in
terest in coin from the national Treasury.
There is no reason which will be accepted
as satisfactory by the people why those who
defend us on the land and protect us on the
sea: the pensioner upon the gratitude of the
nation, bearing Hie seal's and wounds re
ceived while in its service; the public ser
vants in various departments of the Govern
ment; the farmer who supplies the soldiers
of the army and the sailors of the navy; the
artizan who toils in the nation’s workshops,
or the mechanics and laborers who build its
edifices and constructs its forts and vessels
of war, should inpayment of their just and
hard earned dues, receive depreciated paper,
while another class of their countrymen, no
more deserving, are paid in coin of gold and
silver. Equal and exact justice requires that,
all the creditors of the Government should
be jiaid in a currency possessing a uniform
value. This can only be accomplished by
the restoration of the' currency to the stand
ard established by the Constitution, and, by
| this means, we would remove a discrinuna-
tion which may, if i* bus not already' done
so, create a prejudice that may become deep
rooted and wide-spread, and imperil the
national credit. The feasibility of making
our currency correspond with the constitu
tional standard, may be seen by reference to
a few facts derived from our commercial
statistics. The aggregate product of precious
metals in the United States, from 1849 to
1867, amounted to $1,174,000,000; while,
for the same period, the net exports
of specie were $741,000,000. This shows
an excess of- products over exports
of $433,000,000. There are in the
Treasure 8103,401,985 in coin, in circu
lation in the States on the Pacific coast,
about forty millions dollars, and a few mil
lions in the National and other banks—in all
less than $160,000,000. Taking into con
sideration the specie in the country prior to
1849, and that produced since 1867, and we
have more than three hundred million dol
lars not accounted by’ exportation or by the
returns of the Treasury, and therefore it is
most probably remaining in the country’.
These are important facts, and show how
completely the inferior currency will super
sede the better, forcing it from circulation
among the jnassee, and causing it to be ex
ported as a mere article of trade, to add to
the money capital of foreign lauds. They
show the necessity of retiring our paper
money, that the return of gold and silver to
the avenues of trade may’ be invited, and a
demand created which will cause the reten
tion at homaof at least so much of the pro
ductions of our rich and inexhaustible gold
bearing fields as may lie sufficient for the
purposes of circulation. It is unreasonable
to expect a return to a second currency as
long as the Government and the banks, by
continuing to issue irredeemable notes,
till the channels of circulation with depre
ciated paper.
Notwithstanding a coinage by our mints,
since 1849, of eight hundred and sixty-four
millions of dollars, the people axe now stran
gers to the currency which was designed for
their use and benefit, and specimens of the
precious metals bearing the National device
are seldom seen, except when produced to
gratify the interest excited by their novelty.
If depreciated paper is to lie continued as the
permanent currency of the country, and all
our coin is to become a mere article of traffic
and to the enhancement in price
of all that is indispensable to the comfort ot
the people, it would be wise economy to
abolish our mints, thus saving the Nation
the care and expense incident to such estab
lishments, and let all our precious metals be
exported in bullion. The time has come,
however, when the Government and National
Banks should be required to take the most
efficient steps, and make all necessary ar
rangements lor a resumption of specie pay
ments. J.et specie payments once be earnestly
inaugurated by the Government and tanks,
and th" valueof the paper circulation would
directly approximate a specie standard.
Specie'payments having been resumed by
the Government and banks, all notes or bill’s
of pa]H*r issued by either, of a less denomina
tion than twenty' dollars, should, by law 1 >
excluded from < ireulation, so that the people
may have the lienctit and convenience of a
gold and silver currency. w hich, in all their j
busineMs tranaartions. will lie uniform in !
value ul home and abroad.
Every man of property or industry- - |
every man who desires to preserve what he
honestly ]m>sm.-sm-s, or to uhtuin vvhal he can |
honestly earn—has a direct interest in main |
taining a safe circulating medium—such a .
medium ar- shall be real and sub-tanttal, not !
liable to vibrate with opinions—not subject ;
to lie blown up* r blown down by the brontli
of speculation, but to lie made stable and
secure. A disordered currency is one of the
greatest political evils; it undermines the
virtues necessary for the support of the
social system, and encourages pnqicnsities I
destructive of its happiness It wars against
industry, frugn’itv, and economy, and it
fosters the evil spirits of extravagance and
speculation. 11 has *bcen asserted by one; of
our profound and most gifted statesmen
that, of all tlie contrivance*; for cheating tlie
laboring classes of mankind, none has i»een
more effectual than Hint which dedudes them
witli pni>er currency. This is tlie most ef
fectual of inventions to fertilize the ricli
man's fields by the«vv eat of the poor num’s
brow. Ordinary tyranny and excessive tax
ation—these bear lightly on the happiness of
tlie mass of the community compared with
a fraudulent currency and tlie lobberics
committed by depreciated paper, our own
history has recorded for our instruction
enough, and more than enough, of the de
moralizing tendency, the injustice, and Hie
intolerable .oppression on tlie virtue and well
disposed of a degraded paper currency
authorized by law, or in any way counte
nanced by Hie Government.
It is one of the most successful devices, in
times of peace or war, of expansions or re
vulsions, to accomplish tlie transfer of all Hie
precious metals from tlie great mass of the
people into the hands of the few. Where
they are hoarded in secret places or deposited
under bolts and bars, while the people are
left to endure all the inconvenience, sacrifice
and demoralization resulting from tlie use of
depreciated and worthless paper. Tlie Secre
tary of the Interior in his report gives valua
ble information in reference to the interests
confided to the supervision of his Depart
ment, and reviews tlie operations of the Land
Office, Pension Office, and Patent (Hlice, and
Hie Indian Bureau. During Hie fiscal year
ending June 30. 1868, six millions six hun
dred and fifty-five thousand seven hundred
acres of public land were disposed of. Tlie
entire cash receipts of Hie General Land
Office for tlie same period were one million
six hundred thirty-two thousand seven hun
dred and forty-five dollars, being greater by
two hundred and eighty-four thousm’d
eight hundred and eighty-three dollars than
the amount realized from the same sources
during the previous year. The entree under
the Homestead law scores two million three
hundred and twenty-eight thousand nine
hundred and sixty-three, excess nearly' one
fourth of which was taken under the act of
June 21st, 1866, which applies only to the
States of Alabama, Mississippi, Louisiana,
Arkansas and Florida. On the 30th of June,
1868, one hundred and sixty-nine thousand
six hundred and forty-three names were
borne on the pension rolls, and during the
year ending on that dav the total amount
paid for pensions, including the expenses of
disbursements, was twenty-four million ten
thousand nine hundred and eighty-two dol
lars, being five million three hundred and
ninty-one thousand and twenty-five dollars
greater than tliat expended for like purposes
during the preceding year.
During the year, ending the 30th of Sep
tember last, the expenses of the patent office
exceeded the receipts by one hundred and
seventy-one dollars; and, including reissues
and designs, fourteen thousand one hundred
and fifty-three patents were issued.
Treaties witli various Indian tribes have
been concluded, and will be submitted to the
Senate for its constitutional action. I cor
dially sanction the stipulations which pro
vide’ for reserving lands for the various
tribes, where they mav be encouraged to
abandon their nomadic habits, and engage in
agricultural and industrial pursuits. This
policy, which was inaugurated several years
since’ has met with signal success whenever
it has been pursued in good faith and with
becoming liberality by the United States.
The necessity for extending it as far as
practicable in our relations with the aborigi
nal population is greater now than at any
preceding period. Whilst we furnish sub
sistence and instruction to the Indians, and
guarantee the undisturbed enjoyment of their
treaty' rights, we should habitually insist
upon the fact that observance of their agree
ment is to remain within their respective re
servations. This is the only mode by which
collisions with the other tribes and with the
whites can be avoided, and the safety of our
frontier settlement secured.
The Companies constructing the Railway
from Oinahii to Sacramento have been most
energetically engaged in prosecuting the
work, and it is believed that the line will be
completed bcfortß the expiration of the next
fiscal year. The six per cent bonds issued to
these companies amounted to $44,337,000,
and additional work had been performed to
the extent $3,200,000.
The Secretary of the Interior, in August
last, invited my attention to the report of .a
Government Director of the i nion Pacific
liailroad Company', who had been specially
instructed to examine Hie location, construc
tion, and equipment of their road. I sub
mitted for the opinion of the Attorney Gen
eral certain questions in regard to the author
ity of the Executive which arose upon this
report, and those which had, from time to
time, been presented by the commissioners
appointed to inspect each successive sec
tion of the work.
After carefully considering the law of the
ease, he affirmed theright ot theExccutive to
order if necessary a thorough revision of the
entire road, commissioners were thereupon
appointed to examine this and other lines,and
have recently submitted a statement of their
investigations, of which tho report of the
Secretary of the Interior furnishes specified
information. The report of the Secretary of
War contains information of interest and' im
portance respecting the several Bureaus of
the War Department, and the operations of
the army, of the strength of our military
force oil the 30th of September last was
forty-eight thousand men, and it is
confirmed that by the first of January next
the number will be decreased to forty-three
thousand. It is the opinion of the Secretary
of War that within the next year a consid
erable diminution of the infantry force may
be made without detriment to the intercstsof
the country; and in view of the great ex
pense attending the military' peace establish
ment, and the absolute necessity of retrench
ment, wherever it can be applied, it is hoped
that Congress will sanction the retrenchment
which his report recommends. While in 1860
16,300 men cost the nation $16,472,000, the
sum of $65,682,000 is estimated as necessary
for the support of the army during the fiscal
year ending June 30.1870.
The estimates of the War Department for
the last two fiscal year’s were, for 1867,
$33,814,461; and for 1868, $25,205,669; the
actual expenditures during the same periods
were, respectively, $95,254,415 and $123,-
246,648. The estimate submitted in Pecem
ber last for the fiscal year ending June 30th,
1869. was $77,124,707. The expenditures
for the first quarter, ending tiie 30th of Sep
tember last, were $27,219,t17; and the Sec
retary of the 'Treasury gives $66,000,000 aS
the amount which will probably' be required
during the remaining three-quarters, if
there should be no reduction of the army—
making its aggregate cost for the year con
siderably in access of $93,000,000. ' The dif
ference between the estimates and expendi
tures for the three fiscal years which have
been named, Is thus shown to be $175,545,-
343 for this single branch of the publie ser
vice. The report of the Secretary of the
Navy exhibits the operations of that Depart
ment and of the Navy during the year.
A considerable reduction of the force lias
been affected. There are forty-two vessels,
carrying four hundred and eleven guns, iu
the six squadrons which are established in
the different ports of the world. Three of
these vessels arc returning to the United
States. ami four are used as storeships, leav
ing an actual cruising force of thirty-five
vessels, carry ing three hundred and fifty-six
guns. The total number of vessels in'tiic
Navy is two hundred and sixty—seventeen
humlrevl and t<>rty three gun- Eighty
one vessels of every are in I
uht, ftrwd with -ix hundred nod ninety-six I
guu». The number of enlisted men in the
service is reduced to eight thousand five hun
dred. An increase of Navy Yard fa< ihtioß is
recommended as a measure which will, in the
event of war, lie prouiotive of economy and
security. A more thorough and systematic
sunuy of the North Pacific t >cean is adviaed,
in tiew of our recent acquisitions, our c»-
panding commerce and the Increasing inter
course w ith the Pacific StalesaudAsia. The
Nuyii! Pension fund, which consists of n
moiety of the avails of prizes capture* ’ dining
the war—amounts to fourteen million dol
lars.
Exception is taken to the Act of 23d July
last, Which nsluccs the interest on the fund
loaned to the Government by His Secretary
as trustee, to three 1 er cent, instead of six
per cent., which was originally stipulated
when the investment was made. ’ An amend
ment of the Pension l-iws is suggested to
remedy omissions and defects in existing en
actment. Theexucuditures of the department
during Hie last fiscal year were twenty mil
lion one hundred anil twenty thousand three
hundred and ninety-four dollars, and the es
timates for the ensuing year amount to twen
ty million nine hundred and ninety-three
thousand four hundred and fourteen dollars.
The Postmaster General’s report furnishes
a full and clear exhibit of the ojierations and
condition of the jxistal service. The ordinary
postal revenue for the fiscal year ending June
30, 1868, was $16,292,600 and the total ex
penditures, embracing all the service for
which special appropriations have been made
by Congress, amounted to $22,730,592, show
ing an excess of expenditures bf $6,437,991.
Deducting from Hie expenditures the sum of
$1,896,525, Hie amount of appropriations for
ocean steamship and other service, the excess
of expenditures was $4,541,466, By using
an unexpended balance in the Treasury of
$3.800,(MX), the actual sum for which a spe
cial appropriation is required to meet the de
ficiency. is $641,466. The causes which pro
duced this large excess of expenditure over
the revenue, were the restoration of service
in tlie late insurgent States, and the putting
into operation of new service established by
acts of Congress, which amounted, within
Hie last two years and a half, to about
48,700 to more than oue-third
of Hie whole amount of tlie service at the
close of the war.
New postal Conventions with Great Bri
tain, North Germany, Belgium, the Nether
lands, Switzerland, and Italy, respectively,
have been carried into effect under their pro
visions. Important improvements have re
sulted in reduced rates of international post
age, and enlarged mail facilities with Euro
pean countries. The cost of the United
State trans-Atlantic ocean mail service since
January Ist, 1868, has been largely lessened
under tlie operation of these new conven
tions—a reduction of one-half having been
effected under the new arrangements for
ocean mail steamship service which went
into effect on that date.
The attention of Congress is invited to the
practical suggestions and recommendations
made in his report by the Postmaster Gene
ral. No important ’question has occurred
during the last year in our accustomed cor
dial and friendly intercourses with the Costa
Rica, Guatemala. Honduras, San Salvador,
France, Austria, Belgium, Switzerland, Por
tugal, the Netherlands, Denmark, Sweden
and Norway. Rome, Greece, Turkey, Persia.
Egypt, Liberia, Morocco, Tripoli, Tunis,
Muscat, Siama. Borneo, and Madagascar.
Cordial relations have also been maintained
witli tlie Argentine and Hie Oriental Re
publics.
Tlie expressed w ish of Congress that our
National good offices might be tendered to
those Republics, and also to Brazilian and
Paraguay for bringing to an end the calami
tous war wliich lias so long been raging in
the Valley of tlie La Platte, has been assidu
ously complied with, and kindly acknowl
edged by all the belligerents. That impor
tant negotiation, however, has thus far been
without result. Charles A. Washburn, late
United States Minister to Paraguay, having
resigned, and being desirous to return to the
United States, the Rear Admiral, command
ing the South Atlantic Squadron, was early
directed to send a ship of war to Asccncion,
the Capital of Paraguay, to receive Mr.
Washburn and his family, and remove them
from a situation which was represented to
be endangered by faction and foreign war.
The Brazilian Commander of tlie Allied in
vading forces refused permission to tlie
Wasp to pass through tlie blockading forces,
and tliat vessel returned to its accustomed
anchorage, remonstrance having been made
against this refusal. It was promptly over
hauled, and the Wasp, therefore, resumed
her errand, received Mr. Washburn and
his family, and conveyed them to a safe and
convenient seaport. In the meantime, an
excited controversy had arisen between the
President of Paraguay apd the late United
States Minister, w liicii, it is understood, grew
out of his proceedings in giving asylum in
the United States Legation to alleged ene
mies of that Republic. The question of the
right to give asylum is one always difficult,
and often productive of great embarrassment.
In States w’ell organized and established,
foreign powers rentse either to concede or
exercise that right, except as to persons ac
tually belonging to tlie diplomatic service.
On tlie other hand, all such powers insist
upon exercising the right of asylum in the
States where the law of Nations is not fully
acknowledged, respected and obeyed. The
President of Paraguay is understood to have
opposed Mr. Washburn’s proceedings on the
injniious and very improbable charge of
personal complicity in insurrection and trea
son. The correspondence, however, has not
yet reached the United Stages. Mr. Washburn,
in connection with this controversy, repre
sents tliat two United States citizens attached
to tlie Legation were arbitrarily seized at lus
side, when leaving the Capital of Paraguay,
committed to prison, and there subjected to
torture, for the purpose of procuring confes
sions of their own criminality, and testimony
to support the President’s allegations against
the United States Minister. Mr. McMahon,
the newly appointed Minister to Paraguay, hav
ing reached the La Platte, has been instructed
to proceed without delay to Ascencion, there
to investigate the whole subject.
The Rear Admiral, commanding the United
States South Atlantic squadron,has been directed
to attend the new Minister, with a proper naval
force, to sistain such just demands as the occa.
sion may require, and to vindicate the rights of
the United States citizens referred to, and of any
others who may bo exposed to danger in the
theatre of war. With these exceptions, friendly
relations have been maintained between the
United States and Brazil and Paraguay. Our re
lations during thepastyear wish Bolivia,Ecuador,
Peru and Chili, have become especia’ly friendly
and cordial. Spain, and the Republics of Peru,
Bolivia and Ecuador, have expressed their wil
lingness to accept the mediation of the United
States for tho termination of the war upon the
South Pacific coast. Chili has not finally de
clared upon the question.
In the meantime tlie conflict lias practically ex
hausted itself, since no belligerent or hostile
movement lias been made by cither party during
the last two years ; and there are no indications
of a present purposeto resume hostilities on either
side. Great Britain and France have cordially
seconded our proposition of mediation, and I do
not forego the nope that it may soon be accepted
by all tbe belligerents, and lead to a secure es
tablishment of peace and friendly relations be
tween the Spanish American Republics of the
Pacific and Spain—a result which would be at
tended with common benefits to tlie belligerents,
and much advantage to all commercial nations.
I communicate for the consideration of Cou
giess a corresiMMidence, which shows- that the
Bolivian Republic has established the extremely
liberal principle of receiving into its citizenship
any citizen of the United States, or of any other
oi the American Republics, upon the simple con
dition of voluntary registry. The correspond
ence herewith submitted will be found painfully
replete with accounts of the rain and wretched
ness produced by recent earthquakes of unparal
leled severity, in the Republics of Peru. Ecuador,
and Bolivia.
The Diplomatic Agents and Officers of the
United States who were present in those Repub
lics at the time of those disasters furnished all
the relief in their power to the sufferers, and
were promptly rewarded with grateful and touch
ing ackuowleugements by the Congress of Peru.
Au appeal to the charity of our fellow citizens
has been answered by much liberality io this
connection. $ submit an appeal w hich has been
made by the Swiss Republic, whose Government
and institutions are kindred to our own, in be
half of its inhabitants who are suffering extreme
destitution produced by recent devastating nua
detions.
Cur relations w ith Mexico, during the year,
have been marked l>y an increasing growth »f
mutual confidence.
The Mexican tl-’iernuient has not yet acted
upon the three treaties celebrated bore lost sum-
m«r fur establishing tbe rights of
epon a Hbsral ami just has", r “f 4
regulation us eoosular powers and f .’rti ,
justinent of annual elaiass. An t | 1C 4 1
nations, as well as all friend .; u y:'‘‘ er ‘ ul
Mitutions, have occasion to regret tl,■ ’fLV“ '''
Incal disturbancoa which occur in ' „i,,. !' K!l
constituent States of Columbia. b.i!j J l,
Meurred, however, to effect the l.\r, 1 1
cordial friendebip which has fur
•Rifted between that youthful ,U1
Republic and our own. Negoti.i ions aie t en' '
with a view to the survey and u••r.F'.tu
ship canal across the Isthmus ■ I \
Hie auspices ot the United Biatt
be able to submit tbe results of that i./ '
to tbe Senate during the prci»-t>t sc ,
The very liberal treat , wh
last year, by the United States an,i X l( . a , .
has been ratified by the latter Republic
Rica, with the earnestness ot a sincerely fricn*
neighbor, soKoila a roelprooity of trade, v.hi,V
commend to the conslaerati >n ol C»,n
A Convention i ailed by n treaty I,etw.
United Staten and Venezuela, in July, lso i‘ f
the mutual adjustment of claims,’ has i,. /
held, and its decisions have been received I ''
the Department of State. Hereto ore the r
ognized government of tho United States , i
Venezuela has been subordinate, and i provi
aional government having been institute
under circumstances which promise dursbilit,
it has been formally recognized. li l ive t , ■'
reluctantly obliged to usk explanation a,,!!
satisfaction for National injuries committed
by the President of Hayti. The political »nd
social condition of the Republics of llavtiand
St. Domingo, and the entire West Indies'
except tbe Spanish Islands of Cuba and p orl '
Rico, has been followed by a profound doot°
lar conviction of tbe rigbtfulluees of Rcmib! ;
can institutions, and an intense desire to secur'
them.
The attempt, however, to esfnblisli republi.
there encounters many obstacles, most
which may be supposed to be from Tong in
dulgcd habits of colonial supineness a n( f q,'
penitence upon European monarchical power
while tbe U nited States have on all occasions
professed a decided unwillingness that anv
part of this continent or of its adjacent islands
shall be made a theatre for a new establishment
of monarchical power. Too little lias been dom
by us, on the other hand, to attach tbe
communities by which we are surrounded
to our own country, or to lend even
a moral support to the efforts they are
so resolutely and so constantly making
to secure republican institutions for .themsolves
It is a question of grave consideration whi-ilu r
our recent and present example is not calculate!
to check the growth and expansion of fre
principles, and mak- these communities distru
if not dread a Government which, at will, C on’
signs to military domination States that
integral parts of our Federal Union, and, wbib
ready to resist any attempt by other nations:
extend to this hemisphere the monerohical io
stitutions of Europe, assumes to establish over
a largo portion of its people a rate mere absolute,
harsh and tyrannical than any known to civil
ized powers.
The acquisition of Alaska was made with the
view of extending national jurisdiction and re
publican principles in the American bemispheii
Believing that a farther step could be taken in
the same direction. 1 last year entered into a
treaty witli the King of Denmark for tlie pur
chase of the Islands of St. Thomas and St. John,
on the best terms then attainable, and with the
express consent of Hie people of these Island .
This treaty still remains under couijideralion in
the Senate. A new convention has been entered
into with Denmark, enlarging the time fixed for
final ratification of the original treaty, Conqri
liensive national policy would seem to sanction
the acquisition and incorporation into our Federal
Union of the several adjacent continental and
insnlar communities as speedily ns it can be done,
peacefully, lawfully, and without, any violativi
of national justice, faith or honor. Foreign pos
session or control of these communities lias liitii
ert, hindered the growth and impaired the iutlr,
ence of the United States. Chrome revolution
and anarchy there would be equally injurious.
Each one of them, when firmly established as an
independent republic, or when incorporated iun
the United States, would be a new sottrt. of
strength and power.
Conforming my administration to these prin
ciples I have on no occasion lout supporter ink
ration to unlawful expeditious on foot upon tin
plea of republican propagandist!!, or of nation::
extension or aggrandizement. Tbe necessity,
however, of repressing such unlawful movemem.*
clearly indicates the duty which rests upon us
of adapting our legislative action to tho newer
cums’anees of a decline of European inoiarebi
cal power and influence, and tho inci’ea f of
American Republican ideas, interests and syi .
•pathies. It cannot be long before it will be
come necessvry for this Government to 'end some
effective aid to tbe solution.<>f the political and
social problems which are continually kept be
fore the world by the two Republics of St. I><
mingo, and which are now disclosing themselves
more distinctly than heretofore ini IstanAil
Cuba.
The subject is commended to your eousidn
ation with all the more earnestness because I
am ’satisfied that the time has arrived when
even so direct a proceeding as a proposition lor
an annexation of the two Republics of the
Island of St. Domingo would not only receive
the consent of the people interested, birtvvoukl
also give satisfaction to all other foreign Na
tions. I am aware that upon the question of
further extending our possessions it is appro
hended, by some, that our political system
cannot successfully be applied to an arc more
extended than our Continent. Hut the con
viction is rapidly gaining ground with Ameri
can mind that with the increased facilities for
inter-communication between all portions of
the earth, the principles of tree government,
embraced in our Constitution, if faithfully
maintained and carried out, would prove of
sufficient strength and breadth to comprehend
within their sphere and influence the civllizri
nations of the world.
' ‘ Tb 4 attention of the Senate and of Congress r
again respectfully invited to the treaty lortbv
establiflimeni of couiniereiai reciprocity with the
Hawaian Kingdom, entered into last year, mJ
already ratified by that Government. The atti
tude of the United States toward these Islands
is not very different from that iu which they
stand toward the West Indies. It is known and
felt by the Ilawaisn Government and people that
their Government and institutions are feeble and
precarious; that the United States, being '
near a neighbor, would be unwilling to see the
Islands p»»s under foreign control. Their pros
perity is continually disturbed by expedition
and alarms of unfriendly political proceedings,
a, well front tho United States aS from other
foreign powers.
A reciprocity treaty, while it could not mate
rially diminish the revenue of the United State
would be a guarantee of the good will and lor
bearance of all nations, until the people of the
Islands shall, of themselves, at no distant day,
voluntarily apply for admission into the
Union. ,
The Emperor of Russia has acceded to the
treaty negotiated here in January last, for the
security of trade marks in tho interest of mann
facturers and commerce. I have invited his
attention to the importance of establishing now,
while it seems easy and practicable, a lair an
equal regulation of the vast fisheries belonging o
the new nations in the waters ot the -bort
Pacific Ocean. .
The two treaties between the I mud Diarra
and Italy for the regulation of Consular -pow ei’
and the extradition of criminals, negotiart.
and ratified here during the lust session ot c
gress, have been accepted and coniirnw' .
the Italian Government. A liberal Const
convention. which has beeu negotiated "•
Belgium will be submitted to tl c Senate,
less important treaties which were uegoti*
between the United States and North Genna-iy
and Bavaria, for the regulation ot the iii.b
naturalized citiz.ens, have been du y rati •
and exchange and similar treaties hay' l - j
entered into with the kingdoms ot Belgium
Wurtembert’, and with the Grand B ue “ l .* , 0
Baden anti Hesse. I hope soo? t< ?. be th ,.
submit equally satisfactory contentions >
same character now lit the courseot nego
with the respective governments oi l-
Italy, and the Ottoman Empire. .
Examination of claims agaiust 6w
States by the Hudson Bay Company ““
Puget's Sound Agricultural Company, on a a
of certain poesessory rights in the State ot
and Territory of Washington, alleged sot tuew
Companies in virtue of provisions of tilt. .
between the United States and Great Bnta , .
Jnne 15, 1846, has been dihgentlv P r ’ . , u
under the direction of the joint internation’
mission, to which they were submitteu w j .
cation by treaty between the two Govern®. m
of July’J. JMKf.tmd will.it is expected
eluded at an early day. °,PT* « ?-I can be
concerning cokmml trade »ud the . sta;e ,
accomplished by treaty tietwecn the ! i
and Great Britain until Cougrew p J.‘j uc ; P le
pressed their fudgmeul coneesniifi , e J.......*1,r
Involved. Three other question’- a ,' Kri[a) ',i r,
tween the United States anil Great U
main open for adjudication- Theee ’’ lV ' , arv
tnal rights of naturalised citizens, the Sau
queetion, involving the title t<> the Iria | w)in ,
Juan, on the Pacific coast, and mu » hßi ,
atieing since the year 18-sl, of the c . , lU ,|
subjeets of the two countries, tor ' ll -l""'j T ,
depredations committed undu the
their respective Government a.
Negotiate S’ upon these objects are pem s
and 1 am not without hope ot bving a® 4
