IConeintiedfrom the First page.l
Ibis exhibit shosva that the largo , sum of 51,4.
m2,660,537/68 was expended in the payment of.
the interest and of other demands upon tho:
Treasury ha three years and seven months, being'.
an average annual expenditure of ft508,6*.16,
861.68. • - •
If the statement of the debt on the first
day of April, 1865, had i ruled all debts due all
that time ; and $1,822,6. ,537 68 had really heed
expended in payment of the interest on the pith-L.
to debt, and the current expenses of the Govern 4
merit between that day and the first day of No- t
umber last, there would have been a profligacy
.and a recklessness in the expenditures of the
public moneys discreditable to the Government,
and disheartening to tax-payers. Fortunately
this Is not the fact. That statement (as is true'
of ,all other monthly „ statements of the
Treasury), exhibited only the adjusted debt
according to the-books of the Treasury, and did
not, and could not, include the large - sums duo to
the soldiers of the great Union army (numbering
at that time little less than a million of men) for
"nay" and for "bounties." or on claims of we'll
one kin& which must of zit cesslty have been un
settled. For the purpose of nutting this matter,
right, the Secretary bus endeavored to ascertain
from the War and Navy Departments how unfelt
of their respective disbursements, since the close
of the war, has been in payment of debts proi
perly chargeable to the expenses of the war. The
Yellowing is the result of his inquiries:
By the War Department ... 9Q
By the Navy Department... 35,000,000 00
it has been impossible to obtain an exact state
ment of the amount of such debts paid by the
Navy Department, but sufficient information has
been received to justify the Secretary in estima
ting it in round numbetnnt thirty-five millions,
which is probably an under 'rather it an ovee-es
liniate. The expenditure& of the War Depart
ment have been furnished in detail, and are be
lieved to be sebstantially correct.
These figures show that the money ex
pended by the War and Navy Departments, be
' Sweat the first day of April, 1865, and the first
day of November, 1868, on claims justlycharge
able to the expenses of the war. amounted
t 05630,421,125 90
_ _
To which should bc•added amount
advanced to the Pacific roads..
Amount paid for laska
$679,825,125 90
Deducting this sum from the amount of the re
venues, $1,662,476,06220, and $160,174,47548, tho
Increase of the public debt—the remainder,
*1,142,825,411,078 or an average of $318,928,02189
per,annum, is the amount actually expended in
the payment of current expenses and interest.
It is thus shown that within a period of three
„years and seven months, the revenues or the re
ceipts from all Foams of revenue reached the
'enormous sum of $1,662,996, 062 20, and that
*630,431,125 90 were paid on debts which were
actually due at the close of the war, and for
bounties which, like the pay of the army, were a
part of the expenses of the war. Adding the
amount thus paid to the debt as exhibited by the
..booke of the Treasury on the first day of April,
.1865, it appears that the debt of the United States
at teat time was $2,997,386,203 24, and that the
actual reduction has been $470,256,650 42; and
.but for the advances to the Pacific roads, and the
amount paid for Alaska, would have been $519,-
650650 42.
Nothing can better exhibit thegreatness of the
resources of this young nation than this state
ment, or show more clearly Its ability to make
"short work" of the extinguishment of the pub
lic debt. It will be borne in mind that these im
mense revenues have been collected, while one
third part of the country was in a state of great
destitution, resulting from its terrible struggle to
separate itself from the Union, with its political
condition unsettled, and its industry in a great
degree paralyzed; and while aidd the other two
thirds were slowly recovering from - the drain
upon their productive labor and resources—a ne
cessary accompaniment of a gigantic and protrac
ted war.
The Secretary has noticed with deep regret in
dications of a growing sentiment in Congress—
notwithstanding the favorable exhibits which
have been from time to time made of the debt
paying power of the country—in favor of a post
ponement of the payment of any part of the
principal.of the debt, until the national resources
shall be so increased as to makti the payment of
it more easy. - If this sentiment shall so prevail
as to give direction to the action of the Govern
ment, he would feel that a very great error had
been committed, which could hardly fail to be a
severe misfortune to the country. The people
of the United States will never be so willing to
be taxed for the purpose of reducing the debt as
at the present time. Now, the necessity for its
creation is better understood and appreciated than
it can be at a future day. Now it is regarded by
a large majority of tax-payers, as aJ part of the
great price paid for the maintenance of the Gov
ernment, and, therefore, a sacred debt. The
longer the reduction of it is postponed, the
greater will be the difficulties in tee way of ac
complishing it, and the more intolerable will
seem to be the burden of taxation. The Secre
tary, therefore, renews the recommendations
made in his first report, that a eertain definite
sum be annually applied to the payment of the
interest and the principal of the debt. The
amount suggested was two hundred millions of
dollars. As the debt is considerably smaller than
its maximum was estimated at, the amount to be
so applied annually might now safely be fixed at
one hundred and seventy-five millions of dollars,
according to the estimate already made in this
report.
The subject of the currency in which the five
twenty bonds may he paid—agitated for some
lime past—was freely discussed during the recent
political canvass, and made a question upon
which parties, to some extent, were divided. The
premature and unfortunate( agitation and discus
con of this question, have been damaging to the
credit of the Government, both at home and
abroad, by exciting apprehensions that the good
faith of the nation might not be maintained. and
have thus prevented our bonds from advancing
In price, as thcs otherwise would have advanced,
after it was perceived that the maximum of the
debt ...ad been reached,and have rendered funding
at a low into of interest too unpromising to be
undertaken. In his report in 1865, the Secretary
used the following language:
"Before concluding his remarks upon the na
tional debt, tee Secretary would suggest that the
credit of the five-twenty bonds, issued under the
acts of February 25, 1862, and June 30, 1864,
would be improved in Europe,and,consequently,
their market value advanced at4tome, if Congress
should declare that the principal as well as the
interest of these bonds is to bo paid in•coin. The
policy of the Government in regard to its funded
debt is well understood in the United States, but
the absence of a provision in these acts that the
principal of th:, bonds issued under
them should be paid in coin, while
sueh P. , rovialon is contained in the
act under which the ten-forties were issued, has
created some apprehension in Europe that the
Sve-twenty bonds might be called in at the expl
eation of five y,,ars, and paid in United States
:notes. 41though it is not desirable that our se
curities should be held out of the United States,
it is desirable that they should be of good credit
le foreign G ..rkete on account of the influence
which these markets exert upon our own. It is,
therefore, important that all mb3apprehenelons
on these points should be removed by an explicit
declaration of Congress, that these bonds are to
paid in coin.
Without intending to criticise the inaction of
Congress in •regard to a matter of so great im
portance, the Secretary does not hesitate to say
that, if his ..ecommendations had been adopted,
the public debt would have been much lees than
it is; and that the reduction of the rate of inter
est would ere this have been in rapid progress.
The Secretary doBs not think it necessary to dis
cuss the question in this report. His opinions
upon it are well known to Congress and the peo
ple. They were definitely presented in his report
for 1867, and they remain unchanged. He begs
leave merely to suggest, as he has substantially
done before, that alleviation of the burden of the
public debt is to be obtained—note.in a
decrial of the national credit—not in
threats of repudiation—not in a further
iseue of irredeemable notes—not in arguments ad
dressed to the tears of the bondholders—but in a
clear and explicit declaration by Congress, that
the national faith, in letter and spirit, shall be in
violably maintained—that the bonds of the
United States, intended to be negotiated abroad,
as well as at bored, are to be paid—when the
time of payment arrives—in that currency which
is alone recognized us money in the dealings of
nation 'with nation. Let Congress say thing
promptly, and there can be but little doubt that
the.eredit of the Government will so advance that
within the next two years, the interest on the
larger portion of the debt can be reduced to a
isatisfaetory rate. Ile therefore earnestly recom
mends that it be declared, without delay, by joint
reaclagion, that' the principal of all bonds
Of the United States is to be paid in coin.
It is also recommended that the Secretary be
authorized to issue $500,000,000•of bonds, eno,-
41gai.000 of which shall mature annually; the Unit
0b0 2 000,000 to be payable, principal and interest,
D mural- money—the principal and interest of
the rest in coin; and also suck further amount of
Sends as way by necessary to take up the ov.t-
standing six per cents. and,the non.interest bear- t
hag debt, payable in coin thirty years after date, ,
and redeemable at any time after ten years at the
pleasure of the GpVernment—the interest to be
paid semi-annrArin'coin, and in no case to ex-,
cud the rate of flveper coat:'; provided the Beer&
tary may, in Ips t , disemtion, make the principal
and interest of 000,000;000 of these bonds pay
able at such city or cities in Europe as he may,
dcem.best. ,
The, met that; necording 'to ',the re,Comnenda-,
lion, $50,000,000 of the bonds to be leaned are to
become duo each year for ten consecutive years,
(at the expiration of which time:all of the bonds
would be under the coLtrol of the Government)
would ensure an annual reduction of $50,000,000,
of , the, public. debt, and impart a credit .to the
other bonds which 'would ensure- the
of them onftivorable terms.
* * * w * *
In recommending the issue of bonds beating a
lower .rate .of intereSt, to be exchanged for the'
outstanding six per cents., the Secretary must,
not be understood as having changed his opinion
in regardto the expediency or the wisdom of thO,
recommendation in his last report:
"That the stet of March , 3, 1865, , be ao amended
as to authorize the 'Seeretary of the Treasury to,
issue six per - cent. - gold-bearing bonds; to be
known as the Gonsolidated debt of the United'
States, having twenty years to run, and redeem
able, it it may be thought advisable, at an earlier;
day, to be exchanged at par for any and all other
obligations of the Government, one-sixth part
of the interest on which, in lien of all other
taxes, ateach•semi-annual payment, shall be re
served by the Government, and paid over to the
States according to population.'
He refers to What ho then said in advocacy of
that recommendation, as an expression of his
well-considered opinionS at the present time,and
be is only prevented from repeating the recom
mendation,, by•the fact that it met with little ap
prove] at the last session, and has not grown into
favor since. Ho sincerely hopes that the future
history of the debt will vindicate the wisdom of
those who are unable to approve the proposi
sition.
, The following is a statement of the pablic
debt on,the let of July, 186 a:
)I+llT MARINO COIN INTEREST
5 percent bonds 46221,589,480 00
6 per cent. bonds for 1867 and
42,194,000 00
7,200,900 00
per-1868
ti cent-nnittinni
6 per eent p. 20 bonds
Nairy pension fund..
6E03,441. 80
. 283:677,200 . 00 ..
.1 657,644.600 00
13.000,000 U 0
$2083,003,64180
DEBT BEARING CI7P.,RENGT INTEREST.
per ceut bonds... .. . . $29.088,000 Od
3-year compound interest
notes 21,604 890 00
a year 7.3onoies 25,634 900 00
3 per cent. cor.ificates 50,000 OM 00
126,228,790 00
MATURED DEBT NOT PRESENTED FOR PAYMENT.
8-year 7 10 noteO, due August
15.1867, and June 15 and
July 1 5.1 186 a..... • • ... $12,192,750 00
Compound interest notes,
matured Jtuital), July 15,•
August 15, O cto b
er. 15, and
December.lsll367,,And May. •
15 leak ....... . . .... ..
6,556:920 00
Bonds, Texaaisdemnity.... 256800 00
Treasury .notes,nets July 17.
1861, and prior thereto.... 155,111 64
Bonds, April 15 1842 ... . ti,UUJ 00
Treasury notes, March 8, •
.1868 555.492 00
Temporary loan. 797,02.9 00
Certiticata of indebtedness, 18,000 00
20,527,302 64
DEBT BEARING NO INTEREST.
•
United States notes.... $256,141.723 00
.1. factional currency 32.C6 951 75
tlold certificates of deposit.. 17,678,640 00
Amount in Trevaury, coin.. :5 $
61
28
27 4 1z 06, 6 : 23 7,3 7704. 1.4 , ±
Total deb 159
L
Amount in Tioaeury,cur.3o 505,970 97
......
$1 1 31.096,532 25
reneY• • • • • " • " ......
---
Amount oe debt, less cash in Treasury .. 2,505,200,516 Pi
The following is a statement of receipts and ex
penditures foi the fiscal year ending June 80,1868;
Recatpts from $164;454.509 56
Receipts from lands.... 1,348,715 41
Receipts from direct, 1,788.143 85
Receipts from internal revs. -
nue. . .... . . ..... , 191,087,'w 41
Receipts irom
sources (of which mint
theta was received for pre
mium on bonds sold to re
deom Treasury notes, the
sum of $7,078,203 42)...'....• 48,949,033 9
Total receipts, exclusive of loans... IL. $405,018,1183 M
Expenditures for the civil
service, (of which amount
there was paid for pre
mitim on purchase of Trea
sury notes prior to matm
rity, $7,001 151 0i.... ...... 560,011,018 71
Expenditures for pnsions
and ... . 27,883,069 10
Expenditures by War De
partment 123,246,648 62
Expenditures by Navy De
_rartment.. .
interest on 25,775,502 72
Expendi turee for
the public debt 140.424,045 71
Total expenditures, excin.
• ive of laitcipall of public debt............ $377.340,284 83
The following is a statement of receipts and
expenditures for the quarter ending September
80, 1868:
The receipts from customs $49,676,594 67
The receipts from lands... . 714,895 03
The receipts I tom direct tax 15,533 02
The receipts from internal
revenue 313,785,836 tiB
The receipts from miscel
laneous ourcen (of Which
amount there was received
from premium on bonds
sold to redeem Treasury
Dotes the sum of $587,72512) 6,249, 979 97
---
Total receipts, exclusive of 10am....... $95.35, 868 77
Expendituree for the elvil
e. rvice (of which amount
there woo paid as a pre
mium an purchase of Tres
spry notes prier to mato.
xpenichtute
8 , 300,C00 8121,227,106 33
for pensiLias
and Indians— ..... 12,358,647 70
War epartment.... ...... 27.219.117 01
Navy Department.... . 5.64,7E15 3i
Interest on public debt.... 38.742,811 37
Total expenditures, cadmic° of principal
of public debt . ........ ........ ..... 105,152.470 73
The Secretary estimates that, under existing
laws, the receipts and expenditures for the three
quarters ending June 30,1869, will be as folio we:
krona cuetonia. $12.5,000,000 00
Lando 1.1,00,0 W 00
Internal revenue. 100,000,000 00
Dliscellnneoua sources.. 20,000.000 00
.. ........ ......
And that the expenditurea for the
same period, if there be no reduction
of the army, will be—
For the civil t'el vice
Pensions and indlane....
War Department, inclu
ding $6,000.01 , 0 bounties. 66.00w.w0 00
Navy Department........
interest on public debt.. p 1 1)00,500
Expendlturca 231,030,00(1 00
The receipts ana expenditures under existing'
laws for the fiscal year ending Judo 30, 1370 , are
estimated as follows:
suldOoo,ooo uu - 4 , k
Internal 14(1,003.000 00
..... 2,030.01 X) 09
Mieeeltantoue eolareet3 !25,u.0,000 00
Receipts • 1 1 11 t 1 7.000.1100 011
The expenditures for the same Period, If the
expenses of the army should be kept up to about
the present average, will he as follows
For the civil eervice....... . & 60,000.000.00
Peneioua and
diens... .
War Department..
Navy Department.
Intueet OD Public
debt
Earenditurem ....... OM, 003,000'00
The accompanying report of .the Commis
sioner of inicrnal Revenue gives the neceSsary
information in regard to the Bureau, and con
tains many veryjudicious recommendations and
suggestions which are worthy the careful con
sideration of Congress.
The' internal branch of the revenue service is
the one in which the people feel the deepest in
terest. The customs. duties are collected at a
few points, and although paid eventually by the
consumers, they aro felt only by the great
mass of the people in the increased cost of the
articles consumed. Not so with the internal
taxes. These are collected in every part of the
Union; and , their burdens fall, to a large
extent, directly upon the tax-payers.
Assessors, collectors, inspectors, detectives--
necessary instruments in the collection of the
revenues—are found in every part of the coun
try. There is no village or rural district where
their faces are not seen, and where collections
are not made. The eyes of the whole people are
therefore directed to this system, and it is of the
greatest importance that its administration should
he such us to entitle it to the public respect. Un
fortunately this is n% the case. Its demoraliza
tion is admitted; and the question arises, 'where
Is the remedy ? The Secretary is of the Opinion
'that it is to be found in such amendments to the act-as will equalize the burdens of ta.zatio;n, and
in an elevation of the standard of qualification
for revenue offices.
"'Upon the subject of internal taxes the Secretary
has already spoken. In regard to the character of
the revenue °dicers he has only to say, that there
must be a decided change for the better in this
respeet if the system is to be rescued from its de
moralized condition. After careful reflection;
the Secretary has come to the conclusion that
this chane would follow the -passage of the bill.
reported by . M.Jenekep from-the Joint Commit
tee on Retrenehinent and Ittifornr, - .on the l•ith of
May last s entitled "A bill to 'regulate the civil
service and orovaote thu eilleieney thereof." Die
Secretary gives to this bill his hearty approval,
•
TH4'1)4111;1 7 , EV EIIINGr BULLEVN7-PHILADELPIIIA; WEDNESDAY, ;DECEMBER, 9;.1868.7-TRIPLE -SHEVIAf'
$2413,000,u0u 041
9340.00th000,0u
ia,uuo.mo uo
so,000 • 000,00
76,0tX),01MuU
20,1100,0U0,(X)
128,0va,000,0u
and refers to the speech which was mado,upon ite
introduction, by the gentle - man who reported it,
• for an ahle and lucid exposition elite provisions,
' and for a' truthful`and graphic description of the
evils of the present system of
,appointments to
office. • '
On the fifth day of October last, the day for
their regular quarterly reports, the, number of
National Banks was sixteembundred and forty
four, seventeen of ,whieh were in-voluntary liqui
dation.„ • •
Their capital wa5....,.... .. .. $420,634,511 00,
do.. discounts. ' .. .. 655,875,277 35
.
do. circulation .. . ..... ....... 295,684,244 00
,'do. ..,. _601,830,278 40
In no other country was . so large a capital
ever invested in banking, under a single system,
as is now invested in the National Banks; never
before were - the interests of a people so inter-,
woven with a system of banking, aa3aro the In
terests of;the people of the 'United States with
their National Banking system. It is not strange,
therefore, that the condition and management of
the National 'Banks should bey to them and their
representatives,a matter of the deepest concern.
That the National Banking system is a perfect
one it not asserted by Its friends, that it is a
very decided. improverneittras far.as , circulation
is regarded, - Itp - on - thd systetn - whiehlt has super
seded, must , be ,admitted ,by its op-'
ponents. Before it 'was established, the
several States, whether "in conformity , with
the Constitntion or not—jointly with the General
Government, during the existence of the charter
of the Unikd States Bank, and solely after the
exygration of that charter—axercieed the power
ofissuing bills of credit, in the form of bank
notes, through institutions of their own crea
tion, and thus controlled the paper money, and
thereby.a in nO small degree,. the business and
commerce of the country. In May, 1863, when
the Nahanni Courtney Bureau was established in
Washington, sane-fifteen hundred banks, organ
ized under State laws, furnished the people of
the United States with a bank-noto currency. In
some of the States, the banks were compelled to
protect—partially at least—the holders of their
notes against loss; by deposits Of sectulties with
the proper authorities. In other States, the cap
ital of the banks (that capital being wholly under
the control of their managers) was the only se
mirlty-for the redemption of their notes. In
some States there was no limit to the amount of
notes - thatmight - be - issuedTifseent - e - d according
to the requirements of their statutes,nor any ne
„gratify relation' of circulation 'to capital. lik e ,
others, while notes could be issued only in cer
tain proportions to capital, there was,no restric
tion upon the number of banks that might be or
ganized. The notes of a few banks, being pay
able or redeemable at commercial
centres, were- current ' in most of
the States, while the notes of other
banks (perhaps just as solvent) were uncurrent
beyond the limits of the States by whose authority
they were issued. How Valueless were - the notes
of many of the State banks is still keenly remem
bered by the thousands who sufferedliby their in
solvency. She direct lessee sustained by the
people by tal juisecured bank-note circulation,
and the indirect losses to the country resulting
from deranged exchanges, caused by a local cur
rency constantly subject to the manipulations of
money changers, and from, the utter unsuitable
ness of such a currency to the circum
stances of the country, can be counted
by millions. It is only necessary to com
pare the circulation of the State banks with that
furnished by the National Banks, to vindicate the
superiority of the present system. Under the
National Banking system the Government, which
authorizes the issue of bank notes, and compels
the people to receive them as money, assumes its
just repensibility, and guarantees their payment.
This is the feature which especially distinguishes
it from others, and gives to it its greatest value.
The object of the Secretary, however, in re
ferring to the National Banks is not to extol
them, but to call the attention of Congress to the
accompanying instructive report of the Comp
troller of the Currency,especially tolhat part of
it which exhibits the condition and management
of the banks in the commercial metropolis, and
to the amendments proposed by him to the act.
On the fifth day of October last, the loans or
discdruits of the banks in the city of New. , York
amounted to $163,634,070 23, only $90,000,000 of
- which consisted of commercial paper,the balance
being chiefly made up of what are known' as
loans on call, that is to say, of loans on collate
rale, subject to be called in at the pleasure of the
banks. Merchants or manufacturers cannot, of
course, borrow on such terms, and it is under
stood that these loans are confined mainly to
persons dealing, or rather speculating, in stocks
or coin. This statement shows to what extent
the business of the banks in New-York has been
diverted from legitimate channels, and how
deeply involved the banks have become in the
uncertain and dangerous speculations of the
street.
The deposits of these institutions on the day
mentioned, amounted to :$226,645,655 80, and of
their assets $113,332,689 20, consisted of certain
cash items which were in fact mainly certified
checks, which had been passed to the credit of
depositors, and constituted a part of the $226,
645,655 to of deposits, although the banks always
deduct such checks from their deposits, in mak
ing up their statement for the payment of inter
est, and their estimates for reserves. It Is under
stood to be the practice of a number
of the banks (perhaps the practice exists
to a limited extent in all) to cer
tify the checks of their customers in ad
vance of the deposits out of which they are*e.x.
pected to be paid; in other words, to certify
checks to be good, under an agreement between
the banks and- the drawerS, -that the money to
protect them shall be deposited during the day,
or at least before the checks, which go through
the clearing lionse,can be presented for payment.
The secretary has learned with great surprise
that a number 'of banks—generally regarded
as being under judicious management—certify
in a single day, the checks of stock an,l
gold brokers to many times the amount
of their capitals, with no money actually
on deposit for the protection of the cheeks at
the time of their certification. A more dangereiu.;
practice, or one more inconsistent with prudent,
not to say honest banking, cannot be conceived.
It is unauthorized by the act, and should be pro
hibited by severe penalties. Aside from the risk
incurred by this reckless method of banking, the
effect of such practices is to foster speculation by
creating Inflation. It is in fact part atul parcel
of that fictitious credit which is so injurious to
the regular tiusiness of the city, and to the busi
ness of all parts of , the country,. which' feel and
are affected by the pulsations of the commercial
centre. It is this very dangerous practice com
bined with the more general practice of making
loans "on call," which leads to unsafe exten
sions of credits, and makes - many of the
banks In New York helpless when the
money market is stringent. Can anything
be more discreditable to the banks of the great
emporium of the country, or afford more con
clusive evidence of their imprudent management,
than the fact,that with a capital—including their
surplus and their undivided profits—of one hun
dred millions of dollars, the withdrawal from cir
culation of ten or fifteen millions of legal -tender
notes, by combinations for speculative purposes,
can create a money stringency,by which not only
the stock market is broken down, but the en.ire
business of the city, and to some extent the busi
ness of the country Is injuriously affected! If
the banks were no more• extended than they
ought to be, or had proper control over their
customers, no such combinations would be likely
to bo formed, or if formed, they would utterly
fail of their object.
These remarks do not of course apply to ail
of the banks in New York; for some of them are
strictly commercial institutions, and are under
the control of men who are distinguished alike
for their talents and their conservatism. They
are, however, applicable to them as a class, and
they undoubteely apply in some measure to
many banks In other cities.
The recommendation of the Comptroller that
all National Banks be prohibited by law from
certifying checks which are not drawn upon de
posits actually existing at the time the checks
are certified to be good, is heartily concurred in.
The Secretary has long entertained the opinion
that the practice of paying interest on deposits—
tending, as it does, to keep the hanks constantly
extended in their discounts—is injudicious and
unsafe. Be therefore approves of the reeme
mendation of the Comptroller that National
Banks be prohibited from paying interest on
bank or individual balances.
The Secretary also agrees with the Comptroller
in his recommendation,. that authority be given
to him to call upon the banks for reports on
days to be fixed by himself. If a reserve is ne
cessary, it should bo kept constantly on hand,
and the business of the country ought not to be
disturbed by the preparation el the banks for the
quarterly reports.
The views of the Secretary in regard to the ne
cessity of a central redeeming agency for the
National Banks, have been frequently , presented,
and it is not necessary for bin to repeat them.
There are other suggestions in the Comp
troller's report deServing the attention ot_Con
gress, which. the eneretary lacks the time to con
sider. There Is., one subject, however, not dis
cussed by the Cornptroller,to which the Seeretary
invitee-special attention.
I.3thougb the NatlOmad Bulking oyeWai kltuir/d
be
relieved from the limitation s - now' - imposed
..
upon the aggregate amount of notes that may be
issued, this cannot eafelY be done' us long as the
euspension of specie payments contianes. Never
theless, measures should at once be adopted to
remedy, as far as practicable, the ineqciality.which'
exists - in the distribution °PHI° circulation. <As
the Government has .bythe tax upon the notes
of State banks, deprived the States of the power
of furniehink facilities to their citizens, it is ob
viously Just that those States, which are thua de
prived of these facilities, or svhieh do mit ehare
equally with other States in 'the benefits of the
National -Banking system, should be supplied
with both banks 'and notes. . There are
- two modes by `which'this may be
accomplished.. Ono by reducing the circulation
of the banks of large' capital only—the other by
limiting the,amount of notes to be furnished to
all the binkti-L-say to seventy por Cent. of their
resioective capitals: The latter mode is pref re
ble, as by it no disetimlnation would be mad be
tween the banks, and all would be strengthened
t
by a reduction ofheir liabilities,and by a release
of a port of their means now deposited with the
Treasurer, which would be of material service to
them in the preparation they must make for a re
turn to specie, payments. If a redeeming agency
should be established, the reduction of the circu
lation of the existing banks could •be effected as
rapidly as now banks can be organized in the
Western and Southern •• States where they aro
needed. s .
The new Territory of Alaska bas been the
object of much attention during the past year,
but its distance, and the uncertainty and infre
quency of communication with it, and our
imperfect knowledge of its condition, have
somewhat embarrassed the Department in or
ranizieg therein a satisfactory revenue system.
Under the authority of the act of the last ses
sion. the administration, by • special ' agency
(which in the absence of the regularmachistery
was of necessity resorted to), has been super
eeded by the appointment of a collector to reside
at Fitka,' who left for his pest in Septetabeflat,
ii7 , -.1 has probably, ere this, entered upon the dis
charge of his duties , ' - - • ,•
A gentleman from this Department accom
panied him to assist in establishing thetollection
service on a proper foundation. and in perfect.;
lair arrangements for the prevention of snsug-
RecogniAtiralsb - thevastimportancei of relia
ble information on matters not imufediately con
nected with these objects,but having nevertheless
a most important' bearing upowthem more or
lees direct, another agent, long familiar with that
country,' was, at the same time, despatched with
directions to apply himself to the ascertainment
of its natural resources, the inducements and
probable channels of trade,and the needs of com
merce in the way of lights ann other aide to navi
gation. He was also particularly entreated with
a supervision of the fur interestesandthe enforce
ment of the law prohibiting the killing of the
most valuable fur-bearing animals. ,
The existence of coal at numerous points
has been known for years, and some of the beds
were worked by the Russians with indifferent
success; none;hoWever, has been hitherto pro-
Ors d on the North American Pacific coast equal
to that from the Nanaimo mines, on Vancouver'd
island: and this, though raised from considerable
depth, is not of superior quality. The officers
of the cutters were therefore instructed to ex
plore the coast as far as practicable, for the pur
pose of ascertaining the supply and the quality
of coal in the Territory. A number of localities
producing coal were visited, Including the aban
dontd Russian mines, but at none did the -out
croppings exhibit any flattering 'promise except
on the egad of Cook's inlet. There, near Fort
KenayMibout seven hundred miles from Slikei,
were found upon the cliffs numerous parallel
veins extending many miles along the shore.
Some of the coal taken from them proved to be
superior to that from the Nanalmo mines. The
indications are that the supply is abundant and
the quality faits - _ _ _
The protection of the fur - bearinganimals is a
matter of importance hardly to, be overrated. In
consequence of information received last spring,
the captain of the 'Wayanda. was - directed to
visit, as early in the season as practicable, the is
lands in Behring's sea, where the fur seal chiefly
abounds...On hie arrival at St. Paul's and SL
George's islands, he found there several large
parties engaged in hunting the animals indis
crimately, and in traffic with the natives in ar
dent spirits and other forbidden articles. Quar
rels had arisen, and the natives complained that
the reckless and unskilful movements of the new
hunters bad already driven the animals from
some of their usual haunts. The captain of the
cutter instituted such measures us he felt au
thorized to institute for the maintenance of the
peace and the protection of the animals from in
discriminate slaughter.
The preservation of these animals, by the ob
servance of strict regulations in hunting them, Is
not only a matter of the highest importance in
an economical view, but a matter of life or death
to the natives. Hitherto, seals have been bunted
under the supervision of the Russian company,
and exclusively by the natives, who are trained
from children to that occupation, and derive
from it their clothing and subsistence. They
have becifgosierned by exact and stringent rules
as to the time of bunting, and the number and
kind of seals to be taken. It is recommended
that these rules be continued by legal
enactment, and that the existing
law prohibiting absolutely the killing of the fur
seal and sea otter, be repealed. as starvation of
the people would result from its strict enforce
ment. The natives (with the exception of the
Indians in the southernpart of the Territory,
who are fierce and warlike) are a gentle, harm
less race, easy to govern, but of great enterprise
and daring in the pursuit of game—many of them
passing annualy in their skin canoes from the
main land and Aleutian islands to the islands of
St. Paul and St. George, a distance of about one
hundred and fifty miles, thretigh a strong sea,and
returning with the proceeds of their hunt.
The seals are extremely timid and cautious.
They approach their accustomed grounds each
year with the greatest circumspection, sending
advance parties to reconnoitre and at once for
saking places where they are alarmed by unusual
or unwelcome visitors. They have been in this
way - driven from point to point, and have taken
refuge in these remote islands, whence if they are
now di iven, they must resort to the Asiatic
coast. There can be no doubt that, without
proper regulations for hunting these valuable
animals, and the more valuable but lees numer
ous sea otters. a very profitable trade will very
soon be entirely destroyed. - - ' " .
The United States cannot of course administer
such a trade as a Government monopoly,and the
only alternative seems to be to grant the exclu
sive privilege of taking these animals to a re
sponsible company for a series of years,limiting
the number of skins to be taken annually by
stringent piovikions. ' A royalty or tax might be
imposed upon each skin taken, and a revenue be
thus secured sufficient to pay a large part of the
expenses of the Territory.
Our relations with the Hudson Bay Company,
and the regulation of the transit of merchandise
between their interior trading posts and the sea
coast, by ' way of Stikine river, will doubtless re
quire early attention, but at present the Secre
tary is not sufficiently advised to offer any recom
mendations upon the subject.
The recent political changes in Spain, and the
indications of a more liberal commercial policy
on her part, before thorevolutlini took place, add
force to the remarks and recommendation of the
Secretary in his last report,in regard to our com
mercial relations with that -country. Ho again
stitongly recommends the repeal of the acts of
July 13, 1832, so that Spanish vessels may be sub
ject to our general laws, which aro ample to af
ford protection against unfriendly Spanish legis
lation, and are free from the innumerable diffi
culties of administration, which exist under these
special enactments. .
The Secretary asks attention to the necessity
of more exact and stringent lams respecting the
carriage of passengers, and also of such legiela
don as shall settle, as far as they can be settled
in this manner, some of the vexed questions ari
sing under steamboat laws,
It is necessary merely to repeat, what has been
at other times stated, in regard to the insuffi
ciency of the tax fund to meet the necessary ex
penses of the marine hospitals, notwithstanding
the economy which, during the past year, has re
duced the expenditures more than $12,000.• It is
impossible to ignore the fact that these hospitals
are and must be, unless the rate of the tax is
largely increased, a constant drain upon the
Treasury.-
The revenue cutter service now comprises
twenty-five steamers aud seventeen sailing
steamerss. Of the six steamers on the lakes all Yes
bat
one are at present, agreeably to the views of
Congress, .ont of commissiOn, the "Sheyman"
alone being In active service.
Five of the steamers on the seacoast are:small
tugs, from;forty to sixty tons bUrden, thq utility
and'efficiency of which at the leading;-ports--as
substitutes !or ordinary row boats' on the < one
broaa.'and for thelightentters on the other, both
In the harbor duties of Inspection - and police, and
in the prevention and detection of smuggling—
liaVe'been so thoroughly - tested by OrPerience,
that it la 'thought they should be emplpyed.'sttll
more ex tensivelY awn theYxiciW, are. _.::Upon_ the
Woe In' particular,. they would hoof rue greatest
'ollie,. and they should be autatittit4 tor the
large steamers now there, which should, with one
exception c be sold, as they are depreciating in
value and area useless expense. The exception is
the B. P. Chase, which is of such dimensions that
the might bo 'brought tethese t-coast, where she
could be need ; to, advantage. , . ,This 'would prub..l-
10 bd preferable to a sale Of her where she lies.
The schooner 'DUO," being old and not lit for
thither service,bas been sold. The "Morris" also
is 'about to bo disposed of for the same reason..
Tbetteamer "Nemaha," stationed at Norfolk,bas
been destroyed by accidental fire. r
On the Pacific r.coast are the "Wayanda" in
Alaska, and the "Lincoln" at tan
' in Excellent ccindition• the schooner "Reliance,"
recently ordered to Bides, is also is good order.
"The schooner -." Lane," at Puget Seknd;
,is
Old and 'unfit for, the', requirements, of at
station. •
"the addition of several thousands tulles of sea
' coast, by the purchase Of Abiska,renders the cutter
force in the,Pacitle inadequate for even the-ordi
nary duties pertidning to the service; without re
guru ,to the additional demands upon it for the
prOtCctiOD of the fur-bearing, snituals. Tete re
commendation heretofore made that two' first
close steamerg be built or, ptirehased for the West
ern coast le therefore renewed.-- A steam cutter
is also needed for Charleston, and one for the
coast ot Texas.
In the Coast Survey forty. eight charts
have" been entirely or partially engraved daring
the year, of which nineteen, have been published.
Regular observations of the tides at seven princi
pal stations have been kept up, and tide tables,
tor all parts of.the United - States, for the ensuing
year, have been published. A new edition_of the
Directory or Coast Pilot for the western coast
tas been prepared, and a preliminary gtilde fur
the navigation of the northwestern cosst bas
been compiled.
, The attention of Congress is called to the an
-final report of the Director of the Stint, which
- contains the usual statistics of the coinage of the
countrY, and various suggestions and recommen
dations, which are svorthy of consideration.
The total value of the bullion depoaited at the
mint and branches during the fiscal year sas
$27.1.66,318 70, of which 15:15,472,894 8:2 was in
gold, and $1,98.3,423 - tis in silver. Deducting the
redeflospa theiltlloOnt.f4ffielltaldeposit.was.s24,,
— 59132 - 5 - 84.
The coinage for the year was In gold coin SlB,-
114,425; gold bars, $6,026,810 06 ; silver coin,
$1,136,750;:5i1ver bars, $456, 23640; nickel, cop
per• and bronze coinage, (one, two. three, and
five-cent pieces,) $1,713,355; total coluage, $20,-
964,560 ; total bars stamped, $6.483,016 &t.
The gold deposits of domestic produedon were
at Philadelphia, $1,300,1338 53; at San Francisco,
$14,850,117 81; at New York, $5,•109,:)96-55; at
Denver &357,93511. The silver deposits were at
Philadelphia. $67,700 78; at San Francisco. $651,-
289 05; at New York, $262,812 96 ; at Denver,
$5.082 67.
The gold and 'sliver deposits of foreign pro
duction were $1686.602 35. The amount of gold
coined at Philadelphia was $3,864,425; at dan
Francisco, $14,979,558 52; of silver, at Philadel
phia, 6314,750; at San Francisco, $822,000; of
nie_kel,copper and bronze at Philadelplaia.s
885. Total number. of
Denver
struck, 49,7115,840.
The branch mint at Denver has never coined
money, and its expenses are entirely out of pro
portion, to its busineea. The law tun', which It
was organized should be repealed, , , the insti
tution reorganized as an away. Mil
During the past year the brans , a int building
at Carson City, Nevada, has bet t completed. and
the necessary machinery and fixtures have been
forwarded. It will be ready for work early next
season.
The mint at Philadelphia and the branch mint
at San Francisco have the confidence of the peo
ple and of the government, and when the new
mint building in Ban Francisco is erected, these
mints will be of ample capacity to supply coin
age for the whole country. The business of
coinage requires large and expensive establish
ments, under charge of men of science and of
undoubted integrity; and such can be successfully
maintained only at commercial centreS, where
bullion of different degrees of fineness is con
tinually offered for manipulation.' The
establishment of additional branch mints is,
therefore, unnecessary, and would be injudicious.
The entire deposits at the branch mint in Sin
Francisco wereiormerly In =parted-bullion; now
nearly two-thirds of the amount is deposited in
bars, refined by private establishments. The law
requires that the parting chime shall equal the
actual cost of the process; but the experience of
the past four years shows that not leas than
thirty thousand dollars annually may be saved
to the government by discontinuing the business
of refining upon the Pacific coast; and it is,there
fore, recommended that the Becrettuy htr author
ized to exchange the unparted bullion deposited
at the mint for refined bars whenever, in his
opinion,it may be for the public interest to do so.
it is also recommended that authority be given
for the redemption of the one and two-cent pieces
by the Treasurer, under such rules and regula
tions as may be prescribed by the Department.
During the war the business of the Treasury De
partment was so largely and rapidly increased,
and so many inexperienced men were necessarily
employed, that perfect - order and system could
not be enforced. Many accounts were unsettled,
and some branches of business had fallen into
confusion. Much attention has been given by
the secretary "to straightening up" the affairs of
the Department. He is now - gratified in being
able to say, that order and system have been in
troduced *here they were found to be
needed; that the Bureaus are in a good
working order; and that the "machin
ery" of the , Department Is in - as
satisfactory condition as perhaps it can be, un
der existing laws. The result of the examina
tions which he has caused to bo made has excited
his admiration of the wisdom displayed by Mr.
Hamilton in the system of accounting which he
introduced, and most favorably impressed him
with the value of the services of the men, who,
- poorly paid, and little known beyond the walls
of the Treasury building, have for years con
ducted, with unfaltering fidelity, the details of a
business, larger and more complicated than was
ever devolved upon a single Department by any
Government in the world.
In concluding this communication, it may not
be inappropriate for the Secretary, in ..a tow brief
words,
to review some points in the general pol
icy of the administration of the Treasury for the
past four years.
- The - following statement—published in the lastt
Treasury report--exhibits the condition of the ,
Treasury on the let of April, 1865 ;
Funded debt..
Matured Debt
- - -
Temporary loan certificates
Certificates of Mdebtedneaa.
interest-bearing notes
Suspended or unpaid requisitions
United States notes, legal tenders
Fractional currency
Caeh in the Ttenaury
By this statement it appears that, with $50,-
481,924 84 in the Treasury, there were requisi
tions waiting for pay Mfgit (the delay in the pay
ment of which was greatly discrediting the Gov
ernment) to the amount of $114.256,548 93, that
there were $52,452,328 29 of temporary loan
certificates liable to be presented in t'rona ten to
thirty days' notice, and $171,790,000 of -certifi
cates of ind ebt ed nesswhich had been issued to con
tractors, for want of •the -money to pay the re
quisitions in their favor, and which were matur
ing daily. At the same time, the efforts to nego
tiate securities were not being attended with the
usual success, while the expenses of the war were
not less than two millions of dollars per day. The
vouchers issued to contractors for the necessary
supplies of the army and navy—payable-one-half
in certificates of indebtedness and the other half
in money—wore being sold at a discount of from
ten to twenty per cent, indicating by their de
preciation how low was the credit of the Govern
ment, and how uncertain was the time of pay
ment.
The fall of Richmond Mid the surrender of the
army of Virginia under General Lce, (which vir
tually closed the war,) had not the effect of re
lieving the Treasury.. On the contrary, its em
barrassments were increased thereby, inasmuch
as it, seemed to leave ^the Government without
excuse for not paying its debts, at the:same time
that popular_appeals for subscriptions to the
public loans were divested of much of their
strength. As long as the Governinent was in
danger, by the continuation of hostilities, the
patriotism, of the people could b e Emcees ,
hilly appealed tO , for , the purpose of
raising money and sustaining the public credit ;
without which the war could not be vigorously
prosecuted. When hostilities ceased, and the
safety and unity of the GoVernment . were
assured, self-interest became again the controll
ing power. It will be remembered that it was
then generally supposed that the country was al
ready fully supplied with securities, and that
there was also throughout the Union a prevailing
,apprebension that financial disaster would speedi
ly lollow the termination of the war. The great
ness of the emergencv . gavtithe Secretary no Lime
to try experiments for borrowing on a new seen
aity, of long time and lower interest; and -removed
from bid mind. alidonhts or hesitation in regard
to the muse be , ptireued. It , wati estliditted
that at least seven hundred , millions of dollars
should be raised, in addition to the revenue re
ceipts, for the payment or the requisitions
already drawn, and those that must aoon follow s --
preparatory cto the disbandment of, the great
• Union army—and of other dethande upon the
Treasury. The anxious inquiries thea were, by
what means can this `large amount of money be
raised and not what will be the cost of raising
'it. ' Howe.= the ioldiera be paid, and the army
be disbanded, so that the extraordinary expenses
of the War Department may beiltopped? and
not what rate of Interest 'shall am • paid for the
money. These were the inquiries pressed upon
the Secretary. lie answered them by calllng to
his aid the well-tried agent who had been, em
_,ployed by his predecessors and by of
' tering the seven and three-tenths note;—the most
popular loan ever offered to the ocOplo—in every
city and villoge, and by securing the advocacy of,
the press, tbrOughout the length alad"breadth of
the land. In less than four - months from the
time the work of obtaining subscriptions was
actively commenced, lino Treasury was In 4 con
dition to meet every demand upon it.
-But while the Treasury was thus relieved, the
character of the debt was-by no means satialac
.tory.--On- the first day of-September It consisted -
of the following items
Funded debt Matured deht':
........ . . . . .
Temporary lottii "
Certificates of indebtednors.........-.
rive per cent lora tender notec
stemmas Interott leinti.tender notes..
Sloven-thirty 'totem.. . • z • ..
totted States n ote s , lcifattenilerf..
FreCtlOnsl currencyq.
Suspended Indldir/U .pas zor•• • • •
Total. . . . .
liceucietinif .
Balance. .... ........ 2,757.6M671- a3
Prom this iditni;mea it wiltVe perceived that
491.276,94,123_25 of tbe_punimasensgemeene s i as
villeins forms of temporary securities; $4.33,160,-
560 of United States notes—the e;cesa of which.
over $400,000,000 baying been put into circula
tion in payment of temporary loans—and $26,-
344.712 of fractional - currency. Portions of this
tempos rY debt were maturing daily, and all of
It, including $18,415 00001 the funded debt, was
to be provided for within-a period of three years.
The seven-thirty notes were, by law and the
terms of the; loan, convertible at maturity, at
of theholder s into - five-twenty - hondssor
payablelike the rest of these temporary obliga
tions in lawful money.
it WS of counsel necessary to make provision
for the maturing debt, and also for taking np,
from time to time, such portions of it as could be
advantageously converted Into bonds, or pail in
currency, before maturity, for the purpose of
avoiding the, necessity of accumulating large
sums of money, and of relieving the Treasary
froiii the danger it would be expostal to-if a very
considerable portion of the debt were permitted
to mature with' no other Means far paying It than
that a ff orded by sales of bonds, In a market too
uncertain to be confidently relied upon in an
emergency. In addition to the tern
- portuy loan, payment of which could
be demanded on so abort a notice as to make it
virtually a debt payable on demand—the cer
tificates of Indebtedness, which were maturing at
the rate of from fifteen to twenty millions per
month—lbe five per cent. notes which matured
in January following, and the compound interest
1101tSwhich were payable at various times within
a period of three years--there were e 830,00,000
ol eeven-thirty notes which would become due as
follows. viz.:
Atottyl 15. MI; . ....... 83:0,101rso
&met% 2tAtot.traf
July t ... ....... :Montan
As the option 'ea" conversion . .... with the
holders of these notes, it depended upon the
condition of the market, whether they would be
presented for payment in lawful money, or to
be exchanged for bonds. No prudent man, in
trusted with the care of the nation's interest and
credit, would pernaltlwo or three hundred mil
lions of debt to mature, without making pro
vision for its payment; nor would he, if it
could be =avoided , accumulate large sums of
money in the Treasury which would
not be called for, if the price of
bonds should be such as to make the con
veys-lair-of the notes preferable to their payment
in lawful money. Thapolley of the Secretary was,
therefore, as ho remarked In a former report, de
termined by the condition of the Treasury and
the country, and by the character of the
debt. It was simply, first, to put and keep the
Treasury in such condition as not only to be pre
pared to pay all claims upon presentation, but
also to be strong enough to prevent the success
of any combinations that might be formed to
control its management; and, second, to take up
quietly, in advance of their maturity,by payment
or conversion, such portions of the temporary
debt as would obviate the necessity of accumu
lating Large cut rency balances in the Treasnry,and
at the same time relieve It from the danger of
being forced to a farther issue 0110 gal-tender
notes, or to a sale of bonds; at whatever price
they might command. in carrying out this
policy, it seemed also to be the duty of tees, Sec
retary to have due rented to the interests of the
people, and to prevent, as far as possible, the
work of funding from disturbing legitimate busi
ness. As financial trouble hoaalmost invariably
followed closely upon the termination of pro
tracted ware, it was generally feared, as bar-been
already remarked, that such trouble would be
unavoidable at the close of the great and expen
sive war In which the United States had been for
four years engaged. This, cf course, it was im
portant to avoid as its occurrence might not
only render funding difficult: but might pros
trate those greatinterests upon which the Gov
ernment depended for its revenues. It was, and
constantly has been therefore, the aim of the
Secretary so , to adm inister the Treasary, while
-borrowing money and funding the temporary
obligatione, as to prevent a commercial crisis,
and to keep the business of the country as steady
as was possible on the basis of an irredeemable
and constantly fluctuating currency. Whether
his efforts have contributed to this end or not,he
does not undertake to eayinnt the fact is unques
tioned, that a great war has been closed—largo
loans have been 'effected—heavy revenues have
been collected, and some thirteen hundred mil
lions of dollars of temporary obligations have
been paid or funded, and a great debt brought
into manageable shape, not only withodt a thaarl,
cial crisis, but without any disturbance to the or
dinary business of the country. To accomplish
these things snecessfally, the Secretary deemed
it necessary, es has been before stated, that the
Treasury should be kept constantly in a strong
condition, with power to:-prevent -the credit of ' 9 '
the Government and the great interests of the
people from being placed at the mercy of ad
verse lulluences. Notwithstanding the magni
tude and character of the debt, this power the
Treasury has, for the last three years, possessed;
and It has been the well-known existence, rather
than the exercise of it, which hasaits repeated in
stances, saved the country from panic aneldises
ter. The gold reserve, the maintenance of which
has subjected the Secretary to constant and
bitter criticism, has given a confidence to the
hoiden) of our securities, at home and abroad,
by the constant evidence which it exhibit ed
of the ability of thes • government,
without depending upon purchases in the
market, to pay the interest upon thespublic debt,
and a steadiness to trade, by preventing violent
fluctuations in the convertible value of the, cur
rency, which havo been a more than ample com
pensation to the country for any loss of interest
that may have been sustained thereby. If the
gold in the Treasury : had been sold down to what
was absOlutely neededfor'-the pa - V . 1316A of the in
tercet on the , public debt,not only would the pub
lic credit have beeri endangered,but the currency,
and, consequently, the entire business of the
country, would - have been constantly,subject tes
the dangerous power of speculative combina
tions
$1.100,384241 80
52,452,103 29
171,7901X:0 to
820,812 800 00
114,256,50 93
433 160.569 00
A 254,094 07
2,423 1 437.002 18
5b,481,82,1 84
2.3e6.953.077
• .
- • ' Of the unavailingg - Wert that was - made by the
to Contract, the currency, with the
view of appreciating it to the specie standard he
forbears to speak:. Ills. action in respectto. con
traction, although authorized, and' for. a- time sus
.
tained, was subsequently' disapproved , (as he
thinks unwisely) byteongress. This is a ques
tion, hosever,thgtein be-Jiatter deternined her
eafter ° than now.
Compinint has been made that in the administration
of the Tram-Airy Department since the war there has been
too lunch of interference with the stick and money
market. This complaint, when honestly mado, hiui been
the Jesuit of a want of rallecti , n or of imperfect know
ledge of the financial coudi tiou of the government. 'The
transactions of- the Treasury have from mecca
sity been connected with . the stock and money•
market of New York. if the debt after the clot) of
the war bad been .a funded debt, ; with. nothing to be
done in relati•m to it but to pay the accruing Interest. or
if business had teen conducted on a specie baste, and
consequently been free from-the constant changes to
whirb in has beetrand must be subject as. long as there
is considerable , difference between the I,gcl and commer
cial standard of Value; the 'rrenstry - could have. been
managed with entire independence of the exchange
.or the gold room huh, however. wits not the fact. More
than ote.half of the national debt, according to the, fore
going exhibits; consisted of temporary obligations, which
were to be made igt lawful money or converted into
bends, and there vies in circulation a large amount of
redeemable prondees, constantly ehallging in their con
vertible value. Tho nocretary. therefore, could not be in
different to the condition of the Market, nor avoid' con
nection with it, for It was, in fact, with the market he
had to deal. Ile would have been happy had it been
otherwise: • if bonds ware to ha old to provide tho moans
foE paying the debts that were pay able iu lawful money
it Wan matter of •, great impedance to.' tho
Treasury that the price of bows should not be-depressed
by • artificial Drowses. If the seven.thirty
notes were to be converted into five twenty bonds it was
equally iiffportant that they should mist sin sucirrelatioas
to , fto b e th e r in m'Cgard to prifm.g , that conversions would
be effected. If bonds were eta wecount the notes would
$111,5301191 Bo
toosozo 03
167.148,71310
25,0/Kkooooo
f6mXso oo
217 024,169 001
870.0Y3,000 001
160,553 oci
15344,143 51
• 2311,000 ou
Ml 5 907.613
80 1118,036 13
. •
be preseuted for payment in legal tenders, mid these amid
only be obtained by further issues or thetale of some kind ,
of securities. -For ft:wee years, therefore, the state of
the nuir.kr,t brut hese* matter of limp solicitude to the
ectetsr.v. II be bed been indifferent to it • r felled
car , folly to study the influences that controlled it, or had
hesitated to :ercerelso the power with - which
congrest had clothed him for successfully
fun ins the temporary debt by conversions or satea, he
would have been false to hie tried. The t ask of convert ,
ink a thousand millions of temporary, obligations into
funded debt on a market constantly smith:et to natural
and axtilicial fluctuations, without dopreßring the prices
oflmnds, and without disturbing the businets of the
country. however it may be regarded now when the work
has been . accorni lithe& was, while it IVILS JUR- Pe'
formed, an excesdinely dell.ate one. it Is = but timple
justice to say that lta successful accomplishment is, fir
great measure, attributable to tho judicious action of the
Assistant-Treasurer at New York, M.r. Van
Dyck- Similar complaint has , also been made
of the manner In wish gold and bonds have becrt dta.
Dosed of by what hat been styled 'secret sales. , and yet
precisely the same course as been pursued in theme gates
that careful and pflurent men pursue who sell on their
own account. Tito sales hams been made when currency
Waif needed and pricers were satisfactory: ilt was not
considered wise or prudent to advise the dealers precisely
when and to what ap 01114 • gales were, to be read°. No
vane men operating midis own account would have done
this..lßat all ERICA of gold have been• made in the
open market, and of bonds by agents_ or 1.110 AllllBl4lll.
Treasurer in New York in the .ordinary' way
with a view Of obtaining the very best prices and
with the least possible di•turbance of business. In tho
large transactions of the. Venality. agents haVo been in.
dhpensable. but none have been employed when the
could be done r•loudly welt by the oflicers of the do
Partmeot. Whether done by agents or officers. the Soc.
retary has reason 10 suppose that it has not been done
skilfully and bonmtly an well as economically., lie te
now gratified in being able to say that unless a very
stringent market. such as tram produced *few weeks RRO
hy prry.yerf corribinatirms in New York, should wend to
the Treasury large amounts •of the three
per cent. certificates for redemption no
further retell_ of bonds are likely to be
necessary. • La th, however. the receipts from internal
revenues are Increased, the necessities of the government
requirrrthat the sales if acid shall be continued.
These sales are'now being made by adverthements for
grated bide,'lns'ead 01 the agencies heretofore enielnyed.
The-result to far has not been entirely eatisfactory, but a
proper_ternett_for what.flecordin to.the tone of the pros,
nomiredfo be thoplibilc sentiment. seemed req tire it.
The unit bib's will he fairly tested and continued, if' it
can be without a sacs Itiee of tau public intereat. The
Secretary hat thus referred to a few points in hit admin•
istration of the Treastiry for the purpose of.. explain Ina
Nome things which may have been imperfectly under-
Mood, and not foists purpose of defendiner-hts own sac.
!lon. Deeply sensible of the responsibillries resting
neon him, but neither appalled nor dishearten
by tbelar Ile has performed the duties of hie of
fice according to th e nest of hit judgment - and
the lights that were haute him without dsprecat•
ing criticism, and plainly and earneatly presented his
own view s without seeking popular favor. has
been his good fortune to luivo had for immediate
- predeomrstes tire of- thee aelest men.-tn-ther-countrv. to
whose ludic:out labors be has been greatly indebted for
any ElY.ceos that may have attended Ids administration
of the Treasury. Nor it hs under less obtigation to his
associates. the Officers and leading clerks of the depart
moat. whore Ability nod whose devotion to the public
eervice have ibinmanded his respect and dmf ration.
HUGH IIeCULLOCII,
Secretary of the Treasury.
To lion. Fcbuyler Colfax, Speaker of the !louse of
I re, urea r. as natives."
xtio]Poa_vr
Commissioner of Inlernal Revenue
TRZAICZY DEPAZTIMT,
OFFICE OP INT7rONSL H.ZPTL'NUC,
'Matamoros. November2o, 1868.
tlin. The first measure adopted by Congress after
the outbreak of the rebellion, pravlding revenue from
internal taxation, wee approved august -5, 1861. From
that date until the summer of 1805 too costa of the war
were annunllyincreasne, and these costa coupled
with the interest on the rapidly augmenting public
debt.and the necessity of preserving the national Credit
made constantly increasing taxation absolutely Indus
penreble.
During all that Period the attention of the Treasury
Departmt ntand of Congress tees continually employed
in the dletxtvery of new objects of taxation and addi
tional sources of revenue. That the people carried
thelturdens thus imposed upon them so universally,
and carried them, too, so unctitinpliErdinglY, will for
ever be evidence to their prosperity of cue: power and
their loyalty. It was not until the authority of tee
government had been fully established, its liabilities
determined and
a its finandel capacity ld, and • re
thorngh.ly proven to the wor that any
relief from tax was fazinshed, or even generally • de
eirea,
The largest receipts of internal revenue were daring 1
the fiscal year 1866. when taxation bad reached ite
highest limits, The estimates of the reductions
since that period. made from time to time, with refer
nnee to proposed legislation, were:
Annual/v.
By statute of July 13, 1866 . ..... 865,000,000
By statute of March 2, 1867 . 40.000,000
By statute of February 3,1168... 93,000,000.
By statute of Mara 04 1943
By statute of July 20, j 45,000,000
_ .
The receipts for the lasiCkf , 1% i year were from the
statutes misting July 1, 3Eki7, modified by the act of
March 31,1569. _ .
The frtatute of February relates to cotton, and re
lieved only that grown Alter the year ISO 7.
2.0C111G ATE U.rcEIPTO
The aggregate receipts from internal revenue. ex
clusive of the direct tax upon lands and the duty upon
the circulation and deposits of National banks, were
for the year—
__
$310,90r3,951 17
20,920.474 65
—191,160,561 28
RECEIPTs YIIOM SZvERAL tfOVBCDS.
.Banda. Trtmt Compahies. al fit 1 4 \avinga h a tit t giou
lbtk. 125G3.
Dividends and
additions to
surplus $4,166,023 72 63,774,975 $3,1324,;7499
990.338 U 209,276 07, 26,901 99
Dep05it5......... 2.099,635 83 1,333,31. t 9S 1 - ,4 , k4,512
Capital . 374,974 ii 476,847 71. 399,562 90
Raitivade.
1666
Dividends and
Inprofits 2 .02,205,801 45 . 1 3 -, 262 rj i 2,630,174 08
on bonds 1.Z5.910 ff 7 " ' 1,2.59,155 80
Gross receipts 7,614,418 12 -11:.,2M 21 :3,131,397 19
Daring the 'decal year 1606 and two months of 1867
the tax collected was from assessments upon the gross
receipts for the transportation of property as well as
of persons.
Inaurun,•t Curnpk, (es.
1)44. 1867- 18138.
Divrea and addi
tions to surplus. 6767.231.12 950.473.93 6605,489.78
Premiums and as- .
sesaments 1,169,72 - 3.23 1.326,914.351.2,743.79
Groan Receipt , Tdclraph Companiee.
... 6309,437 62
239,691 93
214,699.18
Grose Receipt ,. uY E.rpre..g Companies.
6615,769. Oa
55% 359 28
671,919,42
Re rehtte Stamps
1866. 615,011,373.18
1867 A 16.094.718A1
1868 1.1X2,252.02
In 1587 $1,i17,117 56. and in 16t4.82,026, 623, were
received from the sale of one cent stampa.
The slim of $3,231,247.27 in 1867, and of $3,549,177.9.2
\ 110868, was received for etaMVO from spelal dies for
ruutuhtu. perfumery, cosmetics, medicines, and other
proprietary articles. -
Legaelfd and SfteCessionv,
81,168,765.59
1,8i1,429 16
2,818,751.97
1866 860,891,185.85
. 57 040,690.67
1868 82,027,610.76
The amount collected in the fiscal year 1866, and,,,,
four-fifths of that collected In 1867, were assessed at
she highest war rates, and the increase of exemption
appeared for the first time in the returns of 1862. The
assessments on the incomes forihe calendar year can
not ell be collected in the same fiscal year, although
„great progress towards this end 'was made with the
last annual list. The total amount thus far reported
from the tax onincomes of the calendaryear 1866 is
*27,417,956.6E and from that of 1867 $22,236.301.79;
of the former amount $9,173.858 were collected in the
fiscal year 1867, and 617,694,098 ,in 186 i. Of the
tax on incomes of 1867 $11,389,781 were collected In
the fiscal year 1868, and bat $7,84¢„600 in 1869. There
"remain several districts from which full returns have
not been received, and it is believed that the amount
actually collected• upon the incomes of 1867 exceeds
.123,000,050..
The number of persona assessed for an income tax
on the annual list of 1865. before the increased ea
emptien, was 460,170. In 1867 the number Was :259.385,
and in 1868;-1n 222 districts, from Which reports have
bten leceived, the number was 222,775. In the 18
missing diatricts the number in 1867 was 20,948.
The e6mparative receipts from several sources dar
ing the , last two years are presented in the following
table:
Apothecaries
Auctioneers..
Bankers
Brewers • ..... 238,155.14 270,265.22
I.lrokens of various sorts.. 1,98,854.94 588,417.48
Claim agents 84,627.49 63,149. 90
Dealett, retail 2.047,860.77 2,18.,,4132.00
Dealers, wholesale 1,880,281.13 1,854,387.80
Denier's, retail liquor 2,966,688.73 3,242,915.81
1... 'are, wholesale liquor.. 987.134.91 592,045 72
Dist - filers, coal oil 21,809.32 19,629.66
Distlllers,spirituous liquors 174,445 71 121,863.92
Dtetillers, apples, erapes... 57,332.15 • 74,188.45
Hotels.... . ... 663.656,32 656,705 41
insurance agents 148.617.85 152,148 51
Lawyers 857.248.41 383,0341,95
Manufacturers....... ....-1,296 487.27 1,427,688 52
reddlers... ..... : ..... 708,1.13.28 • 724,210.29
Physicians and surgeons.. 549,368 64 580, 566.31
Rectifiers • 8 0 , 470.06 87,770.28
Cation. '' . .
$18.409,651.110
.23,769,0713.80
1.1,500,1147. ii
Cigars, Ciffitrettrs foal Cheroots .
1566 $3,4-70,236.80
1867.... 3,661.981 39
1868 t 1,951,6715.20
During the Racal year ISB6 the tax upon cigars Was
$lO per thotteand. From Au.euet 1,°1866, to March,
1867, the rate waripartly epecillc and in part ad 'ado.
Afterthe laet , named date the tax was uniform,
and at $3 per thoneand. Since the act of 1562 the rate
upon cigars has been frequently changed; but as their
OF TOE
11E67. : • _. 1868.
8.55.;447,41 &58,572.46
98,081.8 i 97,448.14
1433,716.79 1,400,383.95
• , • , .• • " , •• ' , ' •• • • . •,„ • • • , • ,
• •'• • , • • , •,r, • • , • . •-• • , k ,
T :I).Aitir - tEitIN.G,..BIILLETN-7PIIILADELPH I .4,:-..WEIWESDAY;..DE.OEUJIER
• .
•
number has always been en , element tn. .deterullatug
the amount of tax, it has been , pract(cahle evory,
year to compute from the returns of, the local ollielre
them:antler of clkare uPon which the ter, has been col iccted
-
From . there it appears that the number in the fiscal.
years
1013 true ... . . 193,e86,231
1b64 4er.IBQ.IVO
)FCS 66 ... .. . . . 668,t40,089,
1E56 " . . 317.443,e01
1667 6 ' ......... •.. 483,800 456
1068 66 . . 5:0,83,0:52
Chewing and Smoking Tobacco.
........ 15;246,477.61
14.317,167.58
2 4 ~j6
1~~
Tbo amount stored in bonded warehouse on tirst , day.
of July, 1866, was 4,123,631 pOunds; /807. 7 , 6 2 5 . 001
pounds; 1888,1 s, 280,53 poundis.
The amount exported in bond dash:lz 1867, was
11;015, 608 pounds; 1869, 11,062. 670 pounds.
Fermented LiporA.
1806
184.7 -
1568 _ 5555,603
The tax at St per barrel has neen uniform daring
tboyear.-
Spfrifrand Brandy.
• Die. spirSlS. Drantly
-029.11*.678.15 ,_ $288:49904
.."
28,290461 31 - N 848.W.5.03
13 419,002.74 871,638.21
Ibo 7 • •
The frilling error r4reipts in 1888 resultedin some
degree from the general expectation that. the tax.
would be reduced, and the consequent unwillingueas
to withdraw spirits from bond at the higher rate., but
mainly from the frauds which made each rethicttort
indlaperisably. necessary. In my lasi annual report, I
discussed at so great length ;the nature and=excent of
these frauds, and that. too. after so long and, so care
ful attention to the subject, that it Is unnecessary, for
me further to dinner, them. Their remedy; lies in
the improved chracter of the revenue and judicial
Mlle :era, rather than in the increased stringency of the
law or improved regulations and requirements of the
department. The above figures do not include the
receipts from forfeitures.
The amount of spbits in bonded warehouse Ju'y 1.
ISO. was 0,081,5151 gallons ; inlBo7, 17,857,272 gallowl
in 18hcl, 27,278,420 gallons.
The quantity oat •of warehouse under transporta
tion bonds'at. the beginning of the fiscal year 18. Si and
of IE4B was at each date considerably in excess of
;1,000,000 ttallom There was none at the commence
mint of lbisi). The quantity:exported , in bond in 1687
was, 4,654.810 gallons, and,in 4,128.1884za110n5.
7'he number of gallons removed to "Claes 2 ware
houses," in 18417, for the manufacture of, cosmetics.
medicines,-cordials, for exportatton, was 892,-
727 ; while In 1868. allowed by' law during only a
portion of the time, it was 98,213.
Z.ICIRZNIMI Or COLIZOT/150 TUE InMENITEr.
The major part of the cost of assessing and collect
ing the revenue is the compensation of locaL °Dicers,
including assistant assessors and rummers' clerks,
who are paid a fixed and dednite sum per day or year,
re,gardlms of the amount accruing to the Treasury
through their services.<
llnhi the statute of March, 1601, and the' close of
the last fiscal year. it was found .necessary to retain in
most of the collection districts the full number of
en*ordinate officers, and the effect of the reduction
since that time will not appear until the next annual
reocrt of this °Mee.
Experines of axPeNting ay4 colt cling inlgrnal men fie
for theffreal ware Eitding June 80, 1807, a 94 1868.
1667. 1803.
Compensation and ex
pulses to ass°. sots and
assistant, assessors..'
-. 81,811,05.62 0,181.179.97
Compensation and ex
penses to collectors 2,153 050.89 2,262.231 69
Superintendente of exports 15,431 71 204335.97
Revenue agents-. . 45.61L85 61,210.32
Special agents to this office 39,812.00 91.00.99
Revenue inspectors........ 169,27L8t 371,518.73
Special revenue commis
sion...
1,22.5.85
Officers and clerks of this
bureau 290,f+09.75 316,709 82
Stamps and Cotton tags... 186.234.61 139,305.71
0. her incidental expenses
of this office 87,999.69
Commissions on vale of
05,53822 805,4138.69
Total ...... 58,982,6861x3, $9,;3117,301.74
These statements comprise the accounts adjusted
and passed by the accounting officers of the depart
ment. and appear more in detail la the report of the
Fifth Auditor.
These amounts in the-shove statement have been
charged. to their appropriate yean - -The increased coat
for assesainglarll36B above the expereatof 1867 was
occasioned main
fromthe increase of the pay of as
sistant assessors $4 to $5 per day. A much
larger number of special agents and inspectors were
in service during the lest year than in anyyear pre:-
ceding but these were all retired by the act of July
20 1668. The number of assistant assessors in com
mission on the Ist day of. November; 1867,-was 3,180.
This number. with the sources Of revenue diminished
by the act of March last, has been largely reduced, and
on the first day of the present month bat 2,284 were in
service. The slicnvance to assessors for clerical ser
vice is, under the tams of the statute. - made by "the
proper officers of the treasury." This language has
been construed to mean the accounting officers, and.
the Commissioner has no voice in determining the
amount; but it is understood that it is being gradually
reduced. -
Te receipts of internal revenue for the fecal years
1866, 1667 and 1868, respectively, and the ratio thereto
of the expenses during thesame periods, were as fol
lows :
Years. Gross collections. Refunded. Drawback.
1666.........5310,906,054 17 $514.6.14 43 5796.866 73
13,7 265,920,474 61 706.551 69 1.664.631 6.8
166.8 191,160,564 28 1,018,334 61 1,379.980 01
Yew. :yet wilting Expenses. Per cent. Per cent.
gross cot- ne t col
lections. lections.
1 6 66 - • 8:N.9,5 9 3, 2 73 0157,659,700 46 $2.47 $2.49
1867.. 263,319,261 28 8,982,680 03 3.38 3.4 t '
1868.. 188,762.249 41, 9,327,301 74 488 4.94
The ratio of coats to collections has increased, of
course, with the reduction of the latter. It has re
quired the same machinery and the same number of
officers to collect taxes at two or three per ceutam as
at five per centum, and until the passage of the stat
utes of the present calendar year it will be necessary to
keep the Officers substantially to their maximum num
ber.
Fuer:ants BECEIPT3 FOR TUB P.RIMEAT FISCAL YEAR.
It has always been difficult to make any accurate es
timate-of tht- -eceipts for the future from internal
taxation. Ti frequent modificationa of the laws
themselves; varying condition of different manu
facturing bil....szts, the shifti.ng values consequent
upon paper currency, together with other disturbing
elements, have materially affected the worth of data
collected at this alas from which otherwise the re
ceipts for any fiscal year could be foreshadowed with
considerable accuracy.
The reduction of the sources of revenue has now,
however, somewhat diminished these embarrassments,
and the collections for the current year can he cal
culated with reasonable certainty.
The following tabular statement presents the ag
gregate of certificates of deposits by collectors received
at this office during July, August: September, and
October, for the fiscal years 1867, 1868, and 1869, re
spectively :
1868. 1869.
July ......$27,09,103 38 $21,731,656 14 $16,989,619 92
Auga5t....39.043,340 81 17,8 , 1051 29 13,900,385 70
66 13,183,606 99 9.760,798 29
Oct .213.414,430 29 114,486,636 10,092,835 24
Ot the amount collected in ltkir' there was from in
come $43.403.695 43; In 1868 $17,783,71.1 04, and. in
1869 88,365,817 68.
I herewith present, also, the collections from the
several Bourses of revenue during the first quarter of
the presentfiscal year in comparison with those of
like character during the corresponding period of the
fiscal year 1888.
The monthly abstract of the collector of the sth
district of North Carolina for August, 1868; and of
the collector of the 3d district of Louisiana for Sep
tember, have not been received, and the collections in
their districs for the months stated are not included
In the receipts for 1869.
Jaly, August, July, August,
and Septem• and Septem
ber of fiscal bar of fiscal
year 1868. year 1869.
Banks and bankere,spe. •
cial tax. and tax on
. -
capital, circulation, and
deposits $1,090,661.26 $336,078.06
Other special taxes 4,053 22t. 87 2,969.497.27
Legacies no 277.97 278,590.36
Successions. 230,730.88 251,065,55
Articles in schdule A.... 997,900.34 300,849.69
PassportQ . . .... 1.9.M../5.00 8,66.00
Gar 313,076.70 811,127.72
Sources not otherwise
herein specially edu
merated, including
cotton and manufac
tured articles
Penaites, &e,
`St amps, other than those
ror spirits, tobacco, - -
and fermented liquors 3,12,970.23 3,3:13,471.73
Salaries of United
States officers and em
plo3 es
Grand total „.. $53,897,963.01 $38,620,893.75
The principal cause of the reduction in the aggre
gate receipts of 1E69 below these of 1668, as shown
above, lathe repeal of the tax upon manufactures. ,
The stun of $5,059,492.60 was received in tiscal, year
1669 from the tax of 50 cents per gallon upon spirits
in bond July 20, and withdrawn therefrom after that
dEfe„ The sum of $062,136.3 4 was either collected
prior to the act of July 20, 1608. and at the rate of $2
per gallon, or f rom spirits distilled after that date
and removed from Itharehow3e at 50 cents per gallon.
01 the spirits in bond at the passage of the act in
July last, 14,976.298 gallons were remaining on the
Ist of November. This by . the requirements of law
must all •be withdrawn on or before the 20th darof
April next, and with the tax of 50 cents per gallon
and 43-1 per barrel of forty proof gallons will yield a
revenue of $8,605,779.
From a careful eonsideration of the above, and of
other data which the proper limits of my report
will not allow me to present, I confidently believe that
the receipts for the present fiscal y ear will reach the
sum of $145,000,000.
UNITED. STATES COURTS AND: ATTORNEYS
. It is the duty of the district attorneys, under the
act of March, 18G7, to make report to,thie °Rice at the
doze of every term of court, of suits brought and the
condition of all ' suits or proceedings in which the
Putted States is A party,. , and,character of
:these reports prevent the distribution of tbe suits
throngn different fiscal years with positive' Accuracy,
but the following statements believed:- to -be
measurably> correct for the Year illeoai
.umber of snits brought to federa contts, F 5 ,3 05
Of these 'the nuMber of proceed ma in rein
-- •
,
I wigs .wrS. - • 2,21.11
Vamber of inolcaentil found and. tiled 1,081
Number of other proceedings in person am 1,033
guomutit recovered in proceeutngs for
forfeiture. 1,261
Convictions on indictment, some includ•
pit more tinuil 0110 person'
Number of
Dinmber of ar)tte decided in favor of the
United Stales - 9,532
Number of suits decided against 'United
States. . 382
number of suits settled or dia . missed.... 621
Number of mitts petding, July. 1, 1868... , 0J.5
Amouht of judgments - recovered In suits • • --
, personain $741,797.47
Amount collected from judgments and
paid Into courts 127,810.01
Proceedso of forfeitures paid into courts., 1,130,150,73
. ..$5.116;14 0 ,40
6.819,34549
T0ta1.... -41,154,027.61
oisruxso smarts —OPne.6.TIOSISOP THE NEW TAW.
The rernocelfing of distilleries to conform to the
law and the reguiations, and the erection of distillery
warehonees, have been the occasion of great expense
and delay to their proprietore,whtle the survey , of tits
ti Hertel'. the procureinent mid distribution of stamps,
the preparation or Yforms and regulations, and the
grcatly increased correspondento consequent upon
the inauguration of the new law, has imposed an im
mense latter upon this oflice,"aild - epon the local °fib
cers.of the district where distilleries are situated. The
nature and extent of this work will be beat 'exhibited..
by &brief refirence to epee of the most important re
quireteents of the statute.
Every dietillery, whether intended for use or other
wise, must be registered with the • assessor of its dig
tract. Its owner must file with' that ofilcer notice of
its location, description and boundaries, its mashing,
fermenting, and distillingcapacity, and its. ferment--
tee period , - together with the number, kinds, and con
tents of , the tulle, boilers, tuba audjoisterns employed.
An;accurate plan of the distillery and its apparatas,
eliiving, the relative location 'of every atilt, boiler,
doubler, worm-tub, cistern, Pipe-valve, and, other
p_aris of the machinery , must be displayed upon the
pretrifsee, and a copy tlled with ' the assessor. ' With -
the aid of aperson _skilful and competent for such
purpose, the assessoria required to make a survey of
every distillery, and to estimate and determine its
trueproduchig capacity, for- the purpose of assess
mesh in case of-deficient returns. Coates of all the
papers above referred to are sent to this office, where
a full and complete record is kept'of ' every distillery.
A warehouse meet be established for every distil- •
Itry, and, under the direction and control of the col
lector of the district, placed in charge et a more
itesper appointed by, the Secretary of the Treasury. A
bond in the penal sum of double the tax upon the
possible production of the distillery for fifteen days
must be given t y the distiller, with at least two sare
ties approved by the assessor, creditioned, among
other things. to a faithful compliance with all the
provisions of the law.
All this meet be done before a d istillerris allowed
to commence operations Afterwards daily reports
to this office ere made by ite storekeeper of all spirits
entered end withdrawn from warehonee., and monthly
reports of materials used, beer msde and spirits pro
duced at the distillery.
Reports of like character are made each month by
the:assessors. based upon the tri-monthly reports to
them front distillers, and including also their assess
ments of deficiencies, and of the per diem and per
bairel. taxes imposed by law. These various
reports when received here, compared with
and chsetred by each other, are dully , recorded and
filed.
The number of distilleries registered and thus
far reported to this office.inciadinfr those not intended
' for present use and those for the distillation of fruit,
is 1.290.
The plans of 316 distilleries, other than of fruit.
have been received and filed as in accordance with
the law and regulations, and otherb - have been returned
for correction. Of these, 64 arein Pennsylvania. 51
in Ohio, 41 in New York, fZ in. Illinois, 26 in Ken
tucky. 16 in iudiptia. 14 in Virginia, 10 in Tennessee.
10 in fdissouri, 10 in Maryland, 7 in Massactitsetts, 7
la Wisconsin, 6 In Louisiana, 6 in lowa. 3 in West
Virginia. 2 in Connecticut and 1 in each of the States
of Alabama; Arkansas, Delaware, 11 pants, New
Hampshire, New Jersey, and 1 in Utah. and 'l in Mon-
71.349 ES
11,806,928.4 9 $74,430.98
250,150.69 E 06,402.45
229,659.55
220,85u.53
costerrozahas,
The power of compromise has been exercised with
great cure. and only npon the recommendation of the i
local revenue officers or district ' attorneys. and the
approval of the Secretary of the Treasury. Nrtalleged
violation by distillers had treets compromised except
upon the opinion of the government attorney that the
offence was technical, or could nor be proved to the
The number of cases compromised during the year
MB Oa
From these there was received as tax.... $419.043.0
Assessed penalties. fixed, - by law . 142,0!. 3 -
In lieu of flnes,penahes,and forfeltar,s. 002,027. ed
No plans bave been received from the 'Pacific coast,
although distilleries there have probably been pat in
operation.
Distillery Wharehowses have been establledied to the
number of 459._
••
•
rom the repo of the storekeepers it appmrs that
•Af-i distilleries are in operation, with an aggregate
daily producing capacity of 227.758 gallons.
The number of Class.it wharehouses existing on the
ist day of July last was 779. Their number was grad
ually and rapidly reduced until the Ist tristard, when
the number was 172, containing manufactured to
bac= aid most of the _spirits distilled prior to the act
of July 20, and still in wtuirehouse.
The statute now in operation contains many im
provements upon that of '1866, is faller and more
definite in Its exactions, places the distilleries and
their operations more completely in the hands of the
government., and 18 more rigorous in its punishment
of offenders, but its successful operation atter all must
depend upon the vigilance and fidelity of the local
officers. The corruption of storekeepers, gangers
and assistant - assessors, even when assessors and'
collectors are above euspicion, will always open
sources of rain to honest tax-payers and loss to the
treasury, which neither the 'wisest legislation nor
the most stringent regulations of the department can
MBE.
Since the date of the present statute, however
there has been a large reduction in the number of
illicit stills in most parts of the country. Those
properly registered and authorized have paid, it is
believed, a greater proportion of their liability than
under the previous law, and the receipts have been in
marked and favorable contrast to those of the corre
sponding time last year.
t3PIRIT • ItETZHE.
It-will be remembered that the joint resolution of
February 3.1868, providing for the appointment of a
commission to examine and test spirit meters, further
provided that, until the report of the commission and
additional legislation upon the subject, all work on
the construction of meters under direction of the de
partment should be suspended, Although this report
was laid before Congress in. March, following, no ac
tion was taken thereon until the act of July :10, by
which the Commissioner of Internal Revenue was au
thorized to adopt and prescribe for use such meters as
he should deem necessary.
The meters adopted by the Secretary of-the Treaso
n, on the ltith of Aprll, 1867, and in progress of con
struction at the date of the joint resolution above re
ferred to. w ere three of Mr. Isaac P. Tice. of New
York. That no injustice should be done distillers,
who were required by law and regulation to purchase
these meters, it was stipulated with Mr. Tice that
their price should be fixed by a committee of three—
one named by the Secretary of the Treasury, one by
the Commissioner of Internal Revenue, and one by the
manufacturer.
CII. , LNOZEI OF BTATT". TSB
Next to frequent changes of officers there is noth
hag eo prejudicial to the personal convenience and in
terests of tax-payers, and eo productive of loss to the
revenue. as frequent changes of the statutes.
The recent act relative to distilled spirits. tobacco.
snuff and cigars, has been in force for so brief a period
that but few modifications which its operations may
prove necessary can now be recommended with
confidence. I would respectfully suggest, therefore,
that the general codification of the revenue 'laws, be
gun at the last session of Congress, be postponed a
and that
tt this statute ma be more throu.
aa a single act theny o
be passed embgracing hly Lal
that is valuable in existing laws, and of each char
acter as to Inbar° it against the necessity of amend
ments for several years.
Some legislation, however. In addition to that re
commended in my report last year, and not covered
by the act of July last, is, I think, advisable at the
present time. •
LIMITATION OF COMMISSIONERS' AUTHORITY TO RE-
- FUND TAEZ.9 FLBRONEDUEILT COLLECTED.
The authority vested in the Commissioner of Inter
n al Revenue to refund taxes erroneously collected has
been the means of preventing muchinexpensive litiga
tion, and hat afforded speedy and expensive relief
to many persons who have been compelled to pap
more.than was legally due. While a withdrawal of
this authority would be productive of great hardship
in many cares, I am satisfied that a statutory limita
tion, of the time within which such claims must be
presented would tend to prevent much abase.
I would recommend that 110 claim be allowed unless
it is presented within fifteen months from the time
when 'the tax was paid:
STAIIIPS UPON TAN-PAID TOBACCO - AND . SNUFF
It having been found practically impossible to pre
pare and furnish to collectors in all parts of the coun
try within : sixty days from ths passage or the act of
July 20,1668, the stamps required for distilled spirits
and tobacco, the Secretary of the Treasury, lathe ex
ercise of the authority conferred' open- him by the
108th section of the act, fixed. the 2d day of 'November
as the - day for putting into operation the
proviKons relative to. the use of stamps.: upon
distilled spirits,. and the twenty-third day of No
vember for atampa upon tobacce and. cigars.
In anticipation of a much earlier nee of stamps upon
tobacco, it was enacted that after theist day of .Tann
ary, 1669, no smoking or fine cut chewing tobacco or
snuff shall be sold or.offered for sale except at retal4
from: stamped wooden packages, melees put up in the
prescribed form of package and duly_ stamped.
It was believed that, by the close of the , cal
endar year. the:: ,etock on the market , : when
the use of ' staMpc should begin, =Would - be se
nearly exhausted that it would not be bardensomd to
impose a second tax upon the small remnant uncon
slimed:- -- The short interval between the 23d day of:
November and theist day of January will not give
the Intended opportunity for the conaumption of un
ataineed tobacco, and;Congress will probably see fit to
'enlarge it I. have been urged to recommend that
provision be made for issuing stamps without charge,'
to be affixed to all, such tobacto as may bet in the hands
-of dealers on the appotnted day. Evasions of the law
'will be comparatively easy en hug as tobacco may be
sold without stampe„ and prominent maunfactarers
believe.that the advantage to the revenue of the early
termination of thetas opportunitlea willmore than
.compensate for the (Aliens° andlnconvenience attend
lng it. I fear, however, that" if this method; Were'
adopted:it would be impossible to Prevent the misuse
of tie-free stamps upootobaccoproperly taxable' 'and'
;prefer, therefore. a poatponementt to vilWater tbamt
the let dap of Januar.
riatix.sna xsy Baomswe.sai,me
. ,
' I have heretofore, in ' annual reports, expreseed
the opinion. that the attempt to et:Meet taxes by means
of stampie upon !Detriments• having no permanent
value for Purposes of evldericer woald prove a falters.
Cettainty rather than Beverrity of punishment must be
relied on to support the sanction of penal statutes.
To no one ot-the various steata taxes now imposed
do theee considerations apply with (creator force than
to the memoranda required of brokers when making
eales of coin and 80cl:irides. Theao memoranda aro in
nokonse evidences of title. During tne fiscal year 1866,
when the tax upon sales of this description was paid'
Monthly to the collectors. the receipts from this
source were in excess of 62,6(0,000. In Aagnst, 1866,
the tax was reduced from one-twentieth to one-hun
dredth of one per cent, and:made payable by stamps;
bet at the same time such chenges were made in the
tetras of the statute ae to render aubject many alai
which had• before escaped taxstion, and thus to some
extent to counteract the effect of the reduction in rate.
eince that time the sates of stamps have been scarcely
larger than before, and L am satisfied that a return to
the for Mer method would ' esenre ca more thorough
enforcement of the law and yield nincti,richer results.
COMPENSATION OP ACTING cottecroits.
By' the third section of the act regulating the tenure
of offices, approved March 2,1867, it is provided that
in awe no appointment is made to a vacant office der
ive the eessiot of the tsenate„ "the office shall remain
in oheYanOo without any salary, fees, or emoluments
Attached thereto," and "the powers and _duties. be
longing to such office shall be exercised by such other
officer as may by law exercise such powers and duties
in case of a vacancy in such office."
Under the statutes relating to internal revenue a
collector appoints his deputies and pays Orem oat of
his cowl:Maidens, and when a vacancy, occurs in the
office of collector, the duties of the office devolve upon
one of his deputies. It follows that when a vaaincy
in the office of collector of internal revenue Is not
filled during a session of the Senate, a deputy Collector
must act as coltector, while no provielon is made for
conmensatang him for discharging the duties of either
office; At the edjournment of.Cengress on the 3d of
'blotch, 1867, there were 69- vacancies in the-office of
collector. Deputies of` the retiring' collectors re
mained in charge of , their reopecttve offices until new
eippointments were made, -- and they have - not received
compezeation for their services. 1 recommend that
some provision• bo made for paying them proper sal
aries, and also to meet similar cases that may occur
hereafter
Much inconvenience and delay is now experienced
in paying the ettbordinate officers in a district When
ever a vacancy occurs in the office of collector, as the
deputy who acts as collector is not authorized to act
as disbaraing agent.
I recommend either that the official bond of a col
lector be made to cover his liabilities as disbursing
agent; or-if-that is-not deemed-advlimble r then that
the bond given by the collector in the cipacity of dis
bureir g agent be made available upon the default of
his deputy acting in like capacity, as the official bOnd
of the collector now Is for the acts of all his deputies.
~~ ~s Y' ~ ess 1= s ~ ~
+ The act of July. 1566,- provided a summary process
for the sale by collectors. without the decree of for
feiture, of goods seized for violation of the revenue
laws, where the aggregate value of such goods should
not exceed 61300. Ample checks are thrown around
the exercise of this authority for the emtection of
the innocent, and I believe that no serious complaint
of its abuse has ever reached this office. The customs
laws have long contained a similar provision, and I
are informed that its working hes given general sat
isfaction. .che statute in its terms now only applies
to goods forfeited under the acts of 1866 and those of
an earlier date, and it should be so amended as to
apply to forfeiture for violations of any revenue law.
The expenees attendant upon sales made in this
way are eo small when compared with the costs which
accrue before pro, err/ can be sold tinder decree of a
United States court, that it would, in my judgment,
be wise if the same method of procedure be authorized
in the cave of goods of a much higher aggregate
value.
The act providing for the appointment of supervis
ors of the revenue requires that each shall be assigned
to a district composed of one or more judicial' die
theta. The services of these officers ut k be princi
pally devoted to matters having little r erence to the
boundaries of judicial districts, sind a' much more
convenient arrangement can be made if this particular
provision is repealed. In each of the States of Penn
sylvania and Ohio the amount of work has been
thought to be such as to require the services of two
supervisors, but the line between the two judicial
districts in neither case coincides with the boundaries
of collection districts. Two collection districts in the
former State, and four in: the . latter, are thus
placed severally under the jurisdiction of ,two super
visors.
ilgain, the proper supervision of the revenues in
the five districts of New Jersey hardly , furnishes em
ploymentfor one officer, while it is not convenient to .
attach the whole State either to the districts inclu
ding the City of New York, Or to that covering the
City of Philatlelphia. Violations of toe revenue law
in the northern part of the State will ordinarily be
found connected with transactions in the one city,
while in the southern part the connection will be
with the other. In general terms the same may be
said of many other parts of the country, and I would
therefore recommend that the law be so changed
that each supervisor may be assigned to a district in
cluding such collection districts as may be deter
mined, by the Commissioner of Internal Revenue.
iIEVEYME BTAN.P9. ITPOI7 EECETPTES.
. The written instruments subject to stamp duty are,
with few exceptions, prepared by persons familiar
with the requirements or law, and at places where
stamps of the proper denomination are kept, and when
'neceesary may be attached without inconvenience.
Among these exceptions receipts for money or the
payment of debts exceeding $2O are the most prom
inent. These are often given under circumstances
when compliance with the law would be exceedingly
inconvenient if not impossible. and by and to people
ignorant of the obligations which the law imposes.
It thus often happens that a person innocently issu
ing an unstamped receipt may be put in peril of
prosecution, while a person innocently receiving it
may find, too late, that thq courts refuse to recognize
it, and that he is wronged. Without remedy.
I am convinced that there is no form of taxation
which, producing so much annoyance to the tax
payer, yields so little revenue to the goveynment. and
I recommend that receipts be stricken from the sche
dule of instruments subject to stamp duty.
CIVIL SEEMVTCY.
In my last annual report I p:resented the distinctive
features of the civil service of Great Britain and of
several countries of the continent, together with the
reasons which, after a study of their superior work
ings, had convinced me of the pressing necessity of a
change for the better in the service of oar own country.
My experience and observation since that time have
deepened my convictions that justice to honest tax
payers and due regard to our national reputation
alike demand the elevation of the revenue service
above indivianal preferences and the flucta Wens of
Fades.
I fully admit that the spirit of our people is some
what averse to the permanent service I eo strongly re
commend; that political aid from those in public
positions is exacted by all political parties, and that
rotation in office is the long-established practice
under local as well as under the general government;
but, unless free institutions mete prove failures,
ballots Minn be cast:from honest convictions rather
than the hope of political preferment or the fear of
political displeasure. The inevetiable tendency of
such prp t strce is-the demoralization of oar institu
tions and the degradation of official
position—good men in all parties relaxing
their interest in public affairs when place-hunting
instead of principle is the controlling power, and men
of well-earned and established reputation refusing to
imperil it In places which have been desecrated by in
competency or fraud. The principles of Mr. Jeucke's
bill, repotted to the House of Representatives from
the Joint - Committee on Retrenchment, passed into
law, would prove of immense public advantage.
TEE OFFICE OP CODIRISSIONER.-A SEPARATE DEPART
WENT.
The bill 'reporfecT---by . the Committee of Ways and
Means at the last. session of Congress, proposed to
create this office into a separate department. with the
Commissioner as its bead, instead of continuing lt, as
it has hitherto been, a bureau of
the Treasury - Department. My experience
long ago convinced me that such a change would he
productive of great benefit to the service; bat the sub
)ect could so readily be made to assume personal and
partisan aspects, thati have hitherto refrained from
its advocacy. Jadginglrom tht past, the passage of
no general revenue law can be expected until near the
close Of the approaching session; and as the change,if
made, will thus coincide with the incoming of a new
administration, the question can now be considered
solely in the light 'of its adminstrative merits.
I believe the public interest would be best eel served
by the erection of a new department, which Should
embrace the collection of all the national revenues ex
cept those derived.from thcsale of the public lands.
I am, sir, with great respct, your obedient servant,
B. A. RoLuss,
Commissioner.
Hon. H.MeCalloch,
beeretary of the Treasury
IBM .1E" 4001=1.7C
OF THE
SECRETARY OF THE INTERIOR.
DEPARTMENT OF THE INTERIOR, Nov. 30, 186'3.
have the honor to inform you that the
reports received by this Department from its
bureau and'other officers have, pursuant to law,
been transmitted to the public printer.
During the last fiscal year 6,655,7422,4 acres, of
public lands have been disposed of. Less by
885,372 acres that than disposed of the previous
Tho cash receipts of the office during the same
period, from all sources, amounted to $1,632,-
145, which exceeds the amount received from
the same sources the previous fiscal year by
$2.84,883.
Lands still undlsposed of are 1,405,366,678 acres.
Of the two Revolutionary soldiers pensioned
by special acts of Congress in 1867, John Gray, of
Ohio, has' died. The other, 'Daniel F. Bakeman,
of New York, is reported as living.
There are at the present tithe , ou the rolls' the'
names of 888 widows''Of 'ReVoltitlonary soldiers
and 1,803 widows and' children of, soldiers , who
'served in. Wars finlisequentte;the Itexelutio.o,444
prior to the rebellion. )
During the past year theni weie exaniiirect
011 owed. 9,825 Iterr apPlieatiOtts for invalid pen
__
'Mons of soldiers Man aggregate annnal - rate ~ of'
$628,271, and 4,854 applications .for, increased
pension"of Invalid-soldiers, at an anneal aggre
gate rate of $280,487. Daring the saute period .
19,242 original pensions to widows, Orphans and
dependenrrelatives of soldiers wore allowed, at
tm aggregate annual rate or $1,01a,202, -and
27,053 applications by the same Class for in
creased pay were also admitted; at;
a total
annual, rate of $1,725,960. On the 30th" of
June,4lB6B, there were on the rolls 14,782. invalid
Military pensioners, whose' yearly , perisione
amoanted to 186,828,025; and _92,213 .widows,
orphans and dependent relatives of soldiers,
whose yearly pensions amounted to $12,065:068,
making the total aggregate of army pensioners
167,095, at a total annual rate of $18,893,094. The
whole amount paid during the last fiscal Year to ',
invalid military' pensioners was $7,484,780; to
widows. orphans and dependent relatives $l6,-
173,801, a grand 'total of $23,658.598, which in-,
eludes the expenses of the disbursing agencies.'
During the same year there were admitted 135
new applications for invalid navy pensions. at
an annual rate of $12,890; fifty applications for
increased pensions of the same class at an annual
aggregate of $2,994;;219 original applications of
:widows.. aena_ and_deperidept _relatives of,
those who died in the navy, at an aggregate rate
of $26,012 per annum, and 'seventy-twopen
sions of the same class were increased nt
a- total yearly rate of $3,600. On ,the 30th
of June,lB6B.tbe rolls of the navy pensioners bore
the names of 1,175 invalids, at an annual aggre
gate of $94,833, and 1,443 widows, orphans and
dependent relatives. at an aggregate annual rate
of $236,256. The amount paid during the'last
fiseal year to navy invalids was $97,340, and to
widows, orphans and dependent relatives or-offi
cers and seamen _of _ the_ navy,_ $255.013; a total
amount of $352,383: • • '44
During the year there were added to the number
of - pensioners of all there--were
dropped, from various causes, 14,752, leaving on
the rolls, January` 30;'1868,169,643. The total
amount paid for pensions of all classes, including
the expenses of disbursement, was $24,010,981, a
sum greater by $6,391,025 53 than that paid the
previous year.
There were 1,077 bounty land warrants is,ued
for 167,720 acres.
The expenditures for special agencies are largely
exceeded by the pecuniary gain to the govern
ment. Over NU claims 'have .thus been Rand
fraudulent, amounting to $27,000 per annum.
An act approved March 2, 1867, established a
Department of. Education, entrusted the manage
ment thereof.to a commissioner, provided for his
appointment, and authorized the employment of
sundry clerks, who wort made subject to his ap
pointing and removing power. It devolved upon
him the duty of presenting to Congress annual
reports, the first of which was to contain a state
tnent in relation to the land grants made by Con
gress to promote education. An act of the last
session declares that the Department of Educa
tion shall cease from and atter the 30th of June
next, and that there shall be established and at
tached to this department an office,to be denomi
nated the "Office of Education," the chief officer
of which shall be the Commissioner of Education.
As In the past so in the future, when new
States &all be admitted into the Union Congress
will grant tbem land for educational and other
purposes, and the •administration of the fend
derived from the sale of it should he confided to
them. Interference by Congress in matters of
purely local concern can be productive of nothing
but unmixed evil.
should, however, "the Office of Education" be
perpetuated, I suggest the propriety of enacting
by whom the - Commissioner shall he appointed. -
The act of last session in other respects.
should 'be modified. Under the constitution
"Congress may . by law vest the appoint
ment of such Inferior officers as they think
proper in the President alone, in the courts of
law or in the heads of departments:" It has
been Judicially determined that clerks are offi
cers within .the meaning of this provision, and
the power of appointing such as this bureau may,,
in the opinion of Congress, require, would there
fore be vested in the Secretary of the Interior.
The Commissioner s as other officers of like grade,
should be required to report to the department
under whose supervision he acts, and not to Con
gress. An appropriation for the next fiscal year
of $6,000 will be required to pay the contingent
expenses of the office„salaries of the Commis
stoner, and two clerks of the first class to be ap
pointed by the Secretary of the Interior. This
sum will be ample if the office be economically
administered. No greater clerical force 'should
be authorized.
During the year ending September 30, 1868,
there were 20,112 applications for pat:ODES; 14,153
patents (including reissues and designs) were
issued; 1692 applications allowed on which
patents did not issue owing to the non-payment
of the final fee: 3,789 caveats filed; 180 applica
tions for the extension of pilots received, of
which 133 were granted. TII receipts were
$696,786, being $l7l less than the expenditures.
Congress, on the 20th of July last, directed that
all moneys standing to the credit of the patent
fund, or in the hands of the Commissioner, and
all moneys thereafter received at the Patent Of
fice Should be paid into the Treasury without de
duction; appropriated $250,000 for salaries, mis
cellaneous and contingent expenses and other
purposes, and reouired it to be disbursed under
the direction ci the Secretary of the Interior.
The cash then on hand, $63,025, was accordingly
paid, and the amount of the credit of the patent
fund transferred on the books of the Treasury.
The expenses from that date to the Slat of Octo
ber were $173,461. The expenses for this and
the following month, including the outstanftg
chime, are estimated at $120,000. An appro
priation of $360,000 will be repaired for the re
mainder of the fiscal year.
At the date of my last annual report you had
accepted four hundred and ninety miles of the
road and telegraph line of the Union Pacific Rail
road Company, and the Commissioners wore then
engaged in the examination of an additional sec
tion of twenty miles. Since that date, including
said twenty miles, 330 have been accepted. The
commissioners have submitted reportg.nion four
additional sections, amounting to 100 miles.
By a report from the government directors it
appears that the expenses for operating the, road
for the year ending September 30, 1868,were $3,-
21.1,565. The amount received from passengers
during the same time was $1,109,501, of which
$130,239 was from the United States. The
amount received from freight was $3,077,33e, of
which the government paid $550,759.
This Department, on the 25th of September,
represented to you that the time had come for
such revision. Brevet Major-General Governenr
K. Warren. United States Army: Jacob Blinkers-.
dei fer, Jr., of Ohio, and James Barnes, of Mas
sachusetts, were appointed commissioners for
that purpose. The first 14 an accomplished ofil-T
cer of the corps of engineers, the other gentle
men are civil engineers of large experience, and
ate reputed to be thoroughly versed ir. the science
and practice of theirprofession.
The commissioners' report has just been re
ceived. The trust confided to them appears to
have been executed with intelligence and fidelity. ,
A description of the location of the road is given.
The elevation at Omaha is 946 feet above tide
water, and at the head of Great Salt Lake. 4,315
feet. The sum of the ascents going westward is
12,995 feet, and the consequent sum of the de
scents is 9,626 feet. They are of the opinion
that the location of the road, as a whole 'and in
its different parts,is upon the most direct, central
and practicable route, but that the . line is not
in all respects well, adapted to the ground,
as there are points where the full capabilities" "of
the country have not been developed, and otharti
Where, in its details, the location is ,radically
wrong. This has been occasioned by a 'desire to
diminish the cost of work by the introduction of
more and sharper curves than the circumstances
require, although the saving in cost was but
small in comparison to the permanent Injury of
the road. The commissioners are of opinion
that the line, as built, should not be permanently
adopted, and that economy and the beet interests
of the road require alterations and improvements
to be made.
The road, when examined, was built 890 miles
from Omaha. Its construction, so far as exca
vations and embankments were required, was
easy. From Omaha to a point 5'35
miles west there •are no rock excavations, and
the natural surface of a great portion of the in
termedlate country presents nearly practicable
grades. From the latter point to the end of the
track, the work Is less than on Eastern roads of
the same length, and the moat difficult parts are
light'in comparison with roads in the Allegheny
mountains. There is but one tunnel. It is on
the bank.of St. Mary's creek, 230 feet in length.
The rolling stock ol the road consists of 117
locomotives, 19 first-(lass and 8 second-class pass
senger cars, 15 baggage, ' 442 •box, 1,227 Ilat, 43
coal and 72paboose Care, besides hand and other
ears suited to special purposes., Thelocomotires
are well constructed and the nUmber, on hand
~ I:!rtibably'suflielent for the present want''of the
road. An additional firinabnn Will he required, foe,
thatpart the road where the line is open for'
through traffic. The ma are Ciptal to those on ,ttio'
best roadai and thhaccounnodations for the dare.,
,Maintenance and repair...9f the rolling stet* are
now sufficient tanleet curient idnlnitfidEcinat
.abet effiraged !nine' to meet' , -in
clueing neceeoitiCo of tlto rod.
• The CorelniesionerB submit the fellowleg
mate of expendlture'whicli will reqnired to
render the first 890 milea sof tee rot4',equal to ar t •
fully completad flrst-crags.rallroad:': Ne
antes are made for workinProgmasormaterifq # l
and equipments ordered or reported ,10 be 8n
transit:, for delliery or already delivered, exctot
So far as they are placed in position in. Rao strusot
lures themeelves-46,401 4 ,550. • '
-The following estimate Is furnished by the
Commissioners of the cost of constructing *el
fully equipping the road from the month -of tbe
Weber canon to the head of the Great - Balt litke
—43,5 . 15,550.. _
As the actual cost of this road 13 a matter of
public interest, I deem it proper to present, In tal
cendensed form, the estimates subtnitted,.on the
14th inst.; by Jesse L. Williams. Ile states . that •
the cost of the road as shown on the tho Woke
of the railroad company is, of course, equivabint
to the contract price per mite. The actual cost
to the contractors, forming an association which
embraces most of the larger stockholders of the
tempany, is shown only by their '011 2 ;
vato :books, to which the government
directors , . have no aecess. • The calmly,-
Lions were, therefore, made from the most scan - .7;
rate, aVallable.dataankthe estimated _cost of the
first 710 miles of the road was taken as the basis
for computing that of the whole Ilde. Shetridt
the road, as is expected by the company, form'
a junction`with that of the California company,
near, the northern`extreme, of Great Salt Lake, a.
little west of Monument Point, its length wont&
be ablaut 1,110 miles. The cost of locating, cae-:
strutting and completely equipping, it And the
telegraph line is $38,824,821,an average per miler
of $3.1,977. •
• The government subsidy in bonds for that 4 dltt ,
tanceat par amounts - to $20,501,000, an 'aver - eget '-
per mile of $26,580. Thu company's first more
gsge bonds are:estimated at 92 per , cent:, and;
would - yield - $27,143,680: The fend realized by.- - -
the company from these two sources amounts ,
$56,647,680,being an average per mile of $51,03f,
exceeding by $10,056 the actual cost ofconstrae,t7
big and fully, eqUipping the reed - ; end yielding it'
profit of more than $17,750.000.
The Central Pacific Railroad Company, of
California, have constructed 390 mUes of, their
road and telegraph line, of which 203 were con- '',
etnicted and accepted since my last annual re
port. ,This cOmpanyfiled a map of the dedett*
location of their road from Humboldt;Walls, by. 4.
way of the head of Great Salt Lake, to the,mouth
of Weber canon. .On the 15th of Slay last 'gave
my "consent,and approval" to the location, as
far as the head of Great Salt Lake, a distanee of
140 miles. Subsequent surveys corrected 'and
improved the unaccepted part of the llnec - ittni,ott
the 14th ultimo they tiled a map and profile from
the head of Great Salt Lake to Echo Summit, to;
which -
which - location I gave my "consent awl appro
val."
The company state that their earnings for the 4
six months ending June 30, 1868, were, from pas
sengers, $145,048, and from freight, $261,410.
Their expenses for the same period - were $157,031
and their indebtednces at that date, $23.862,727,
of which the sum of $7,340,000 was on account
of bonds issued, by the United States In aid of the
construction of the road. _ _ _
On the 13th ultimo Special Commissioners
Sherman Day, United States Surveyor General of
California; Brevet Lieutenant Colonel „R. S. Wil
llamson, United States Army, and Lloyd Tevis
were appointed to examine the roads and tele-
graph lines of the Central Pacific Railroad Com- -
patty of California and the , Western Pacific Rail-;
road
road Company. They were instructed to report
in regard to the location. road-be.d, ewes -ties,
track-laying, ballasting, rolling stock: repair
shops ; station buildings,, culverts, bridges, mkt-
ducts, turnouts, and all Other appurtenances of
the roads, and the amount of expenditure re
mitred to render them, so;far as built, equal in
'every respect to fully constructed first-class rail
, roads. No report has been received.
At the date of my last anneal report the Mien
Pacific Railway Company, Eastern Division, had
constructed 305 miles of their road and telegraph.
line, and 285 miles thereof had been accepted,
Since that date 88 9,425.10,000 additional miles
have been constructed and accepted.
The amendatory act approved July 3, 18C6,
:authorized this company to designate anew wide
and file a map thereof. They: wererequired,
however, to connect with the Union Pacific, at a- ;
point Rot more than fifty miles westerly 'from .
the meridian of Denver, in Colorado. •
Their right to, bonds was limited to the amount
they would have received had, the road been
constructed on the original route to the one
hundredth meridian of limagitude. No accept
able survey had been made from Fort Riley to
that meridian; and as the department was not
officially advised of the exact distance between
those points, Brevet Major C. W. Howell, Cap
tain of Engineers, United States Army, was, at
my request, assigned, on the Bth of Jane last, by
the Secretary of War, to make such survey. He
executed the duty and submitted a report under
date of September 28, 1868. He determined the
distance to be 258 9,495-10,000 miles. He.
also
also ascertained that the meridian is 9,300
feet west of the point desiguated .by
the Union Pacific Railroad Company.
This survey was approved by you. The distance,..
for 'which the company was entitled to bonds is
393 and 9,425-10,000 miles. The following sum
mary is made from their report: They have . con,,
strneted and operated the road , 195 miles west of
the initial point. It, has been provided with
round-house accogratodations . repair , shops -
turn tables, water tanks , sidings, Av., to meet
the immediate wants of business, and the neees-' -1
eery warehouses and depot buildings have been
erected at the stations for the accommodation ,
of passengers and freight. The equiPment
is as follows—Twenty-nine locomotive' '
engines, twenty-one passenger, and 87K"
other care. The aggregate earnings from Sep- ,
tember 1, 1867, to August 31, 1868, were $1,878,-
588, and the expenses $1,247,816, leaving the net
earnings $630,771. The average length of road ,
operated during the year .was 331. a miles, and
the average earnings per mile.ss - ,669. Surveying
parties employed in examining the routes of the
thirty-second and thirty-fifth parallels, have ells-,
covered on the latter a practicable routs westward
from Albuquerque to the Pacific. It crosses
the Colorado river south of Fort Mohave,.
and thence runs westward to the city of
San Francisco, through Tchaehepah Pass of the
Sierra Nevada Mountains, which is only _4,020
feet above the sea. The highest point is la ,the
San Francisco Mountains. 7,461 feet. The entire
line is exempt from obstruction by snow, and
traverses a country rich in mineral wealth-:and,
abounding in timber and coal. Surveys have
also been made from Fort Mohave; on the Colo
rado river, to San Diego, [Lad from Fort Wallace,
Kansas. by way of Puede Pass and San Louis
Park, to Albuquerque. The cost of surveys in
-1867 and Dela was about $225,000.
Sixty-nine and one-half miles of the ;road and •
telegraph line of the Sioux City. and Pacille , Rail- ,
road Company were completed, equipped and
accepted in March last. About thirty-one, and
a half miles, necessary to make a connection with
the 1.7r.i0n Pacific Railroad, are under contract
and in process of grading. The iron has been
purchased and is 1U tre2lainl. The company has
secured a water (rout of about one mile on
each side of the Missouri river; and has con- -
tracted for a steam ferry to pass the cars over.
the river.
The indehteduess of the compaaa is represented
to be $3.299,801.
fire amount received is given as $96,699; opar
,
acing expenses, $53,184.
The company have six first clasa • 'ocean:dives ,
and ninety-nine passenger and other cars in use.
They expect to have the whole line of road com
pleted and in operation next month.'
No track has been laid by the Western Pacifie
Railroad Company within the past year. They,
however, reported on the 15th of September_ last _
that the grading of theuhfinished part of the road
would be completed and ready for the track in 'a • •
few months.
No portion of the Northern Pacific Railroad;
has been constructed. The company report
that surveys have not been continued - diving the
past season for want eta military escort \ to pro-
tect surveying paeties.
In 1867 two routes were run - rom Lake Supe
rior. One commencing at the west end of the
lake and the other at Baytielda The first, follow-
ing a westerly course, crosses the Mississippi
about twelve miles above Crow Wing; thence
rens south of and near to Otter Tail lake, and,
pursuing the same general courses intersects the'
Red river at a point botween,Fort Abercrembie.
and the mo u th of the Sioux Mood river.
The second follows a southwesterly courser
for fourteen 'miles to Pleasant bay; thence Wester
ly to within eighteen miles ,or auperlera thence
its course is direct to the Miseissippl,crossieg that
river at St. Cloud; thence northwesterly up the
Sauk Valley to the Sioux' Wood river, a little to a';
the south of Whertait joins the Otter Tail river.
Both of these , lines have with a`direction on ap
proaching the Red or - Sioux Wood rivers that:
wherecontinued westerly they will pass to the
south of and near the Cheyenne river in Dace
tah.. The dietaries of the first Is 232 miles;and its
estimated cost $7;a67,000, being an .avorAgo per
tale e 114,857:, The distance of the iteemid is
! aa.'7, Milos and its estimated ,$1.1„815,000, , k4a. 1 ,
the alt average per mile of $37,236- The *Eget
nianViefavorablOnii both rendes. The Ittraidoip* ,
[o(irititiacel an ago Eiska Pasuj •