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FRIDAY, DECEMBER 'll, 1868,
EEPORT OF THE
SECRETARY OF THE TREASURY.
In submitting to the consideration, of Congress the re*
.Jport on the state of the finances, required of him bydaw
at the commencement, of each session, the Secretary of
the Treasury lias much satisfaction in being able to s&y,
in general, that the operations of the Department en
trusted to his charge have been attended,during the last
fiscal year, by a greater measure of success than he ven
tured to anticipate at its beginning.
At the bcginuiog of that year all demands on the trea
sury had indeed been discharged, and there remained a
balance to the credit of tho Treasurer of >513,043,516.51,
3utthe Urge disbursements, constantly demanded by
military and naval operations, reduced, by comparison,
this seemingly considerable balance to almost Incon
siderable, proportions, and the practical operations of
the rettrlctive provisions of the acts authorizing tho ne
f;otiatton oflhe bonds known as fiye-twentiea, the most
mportant loan acts not' already fully availed of, made
mew negotiations for adequate amounts and ou adm'ssl
fcle terms quite impracticable The reverses which befel
cur arms in Jane, July, and August, increased the diffi
culties of the situation, so that, thongb the Secretary
Was en&bltd under existing legislation to provide large
ly for the increasing disbursements, there remained ne
cessarily unpaid, on the first day of the last session of
.Congresfi.reqnisitiona on the treasury, chietly from the
“Warand ft’avy Departments, amounting in the aggre
gate to the -sum of $46,594,876.80.
To provide for these requisitions and for current de
mands, Congress,on the 17th of January, lSa3. authorized
an additional issue of Untied Stages notes to the amount
of one hundred millions of dollars; but did not reach
any definite conclusions in regard to loaasin time to em
body them in an act before the day on which tho session
dosed.
On that day,March 3» 1863, tho act to provide way i and
means for the support of the Government received the
approval of the President and became law. In addition
to various provisions for loans, it contained clauses re
pealing the restrictions affecting the negotiation of the
five-twenties, and thus disengaged that important loan
irom the tmbarrassments which had previously ren
dered it almost unavailable.
A week earlier,on the 25th of February, an act, even
more important to the credit of the Government—the act
to p: ovide a national currency through a national bank
ing system—had received the sanction of Congress and
the President. The salutary effects of these two great
acts were soon conspicuous. • • ~
Notwithstanding the aid afforded by the additional
. Issue of United States notes, under the joint resolution, of
the Secretary had found it impossible to pre
■vent a gradual increase, during the session of Congress,
Kin the amount of unpaid requisitions. Those which were
Unsatisfied, at ;he beginning of the session were indeed
large sums were applied to new demands
current disbursements. But the aggregate of dis
agreements, remaining necessarily unpaid, increased
notwithstanding all efforts to prevent it. until it
the session, the sum of #72,171,-
(Theloan act and the nationat banking act were fol
llowed by an immediate revival of public credit, Success
■quite be) ond anticipation cro fvned the efforts of the Se-
Icretary to distribute the five-twenty loan in all part 3 of
■the country, as well as every other measure adopted by
|him for replenishing the treasury. The result was, that'
pwithintwo-months after the adjournment of Congress
Lthe whole mass of sutpended requisitions had been sa
tisfied, all current demands promptly met, and fall pro
■vision made for the pay of the army and navy. During
the remainder of the fiscal year no embarrissments at
■tended the administration of the finances except those
fcvhich are inseparable from vast expenditures. Not
pvtihstandieg these expenditure), It is gratifying to be
■tbie to state that daring the last year the total of dis*
■bnrsements did not greatly exceed, while the increase of
■the public debt did not equal, the estimates submitted to
■Congiesß by the Secretary at the last session, Tacts,
Kvhlle It was then estimated that the public debt on the
■3oth of June, 1863, would reach the sum of $1.122.297,403.24,
|ts actual amount on that day was $1,098.703,151.37:
Kind while the disbursementsfortheyear were estimated
■it $693,346,321.45,the real total was $714,709,995.P8
aggregate receipts from all sources, including the
■Glance irom the preceding year,as shown by the books
fcf the treasury, were, during the last -fiscal year ,$901.-
K 25,674.86, and the aggregate disbursement $595,796.610 65;
■feaving a balance on the 30th of June, 1863, of $5,329,-
■44.21. Bnt sums borrowed during the year.and applied
■during the same time in payment of debts, affect on ly no
fminally iheutal of receipts and of disbursements. The
sums thus borrowed and applied during the last fiscal
, year amounted to $151,056,635 07, This aggregate, there
fore, should be deducted from both sides of the state
ment, making the true amount of receipts, including ba
lance from lass year $720,039,039 79. and the true amount
of disbursements $714,709,996.68. The balance,of course,
remains the same.
It is gratifying, also,to be able to state, that while debts
did not reach the amount anticipated, the receipts from
all sources of income, except internal revenue, exceeded
ihe estimates. Thus the receipts from customs, estimated
at $G5,C41,736. were actually $:9,069,642.40; from lauds,
estimated at $55,724 16, were $167,617.17: and from mis
cellaneous sources, estimated ac $2,244,316.32, were $3,-
£46,616,36. Din ct tax receipts were estimated
620,717 99, and this amount, or nearly thi3 amount, has
boon received in the form of payments for military sup
plies and services by the States.ior which they are enti
tled to credit beyond their several proportions of the tax.
In consequence, however, of incomplete settlements,
only the Burn of $1,485,103.61 appears on the books as re
ceived into the treasury.
While the receipts from other ordinary sources of re
venue thus closely correspond with, taa estimates, or
largely exceed them, the receipts from internal revenue
have alone disappointed expectation. The estimate, in
deed, was made of the operation of a law recently enact
ed, and necessarily imperfectly executed: hut such, cars
had been taken to obtain correct premises that it was
hardly thought possible that the conclusion deduced
from them could be wide of the truth Under the in
structions of the Commissioner, at the instance of the
Secretary, a very competent gentleman was for some
time employed in ascertaining, with the aid of practical
men, conversant with business, the probable amount
of revenue from each object of taxation. The result of
his inquiries was the estimate which, sanctioned by the
Ccmmltsioner, was believed to be correct by the Secre
tary, and therefore submitted to Congress.
Experience has oemorsirated its error. The estimate
was j s2fi,4£G,SQ3.73, while the actual receipts were
$57,640,787.95. A part of the deficiency may oa attri
buted to the imperfect execution of the law, and a part
to the changes made in it by Congress after the estimate
was made ; but it is sot probable, had neither cause ope
rated- to reduce receipts, that the revenue from this
source Would have exceeded half the estimated amount.
It is clear that the law, unless materially amended, will
not produce the revenue expected from it.
The whole of the receipts and disbursements for the
last fiscal year may be more easily understood from a
somewhat more formal statement.
The receipts estimated and actual, then, for the last
fiscal year, ending on the 30th of June, 1863, were, In
cluding balance from the preceding year, as follows: 1
__ Estimated. Actual;
From customs $68,041,75&59 $69,059,642 40
Fxom lands 88 724 16 167,617 17
From miscellaneous 2,244 316 32 3,046,615 35
From direct tax 11,610,717 99 1,485,103 61
From internal revenue. ..... 85,456 303 73 57,640,787 95
Balance from, last year 13,043,546 81 13,013,546 81
Total receipts from all ordi*
nary sources $180,495,345 60 $124,443,313 2?
The additional sums, actual or estimated, necessary to
meet disbursements, were, of coarse, derived, or esti
mated sb derivable, from loans.
The disbursements, estimated and actual, were as fol
lows
.~532.511,543 23 $23,253,922 OS
.. 598 J, 906 43 4,216,520 79
.. 747,359,828 9S 699,293,603 S 3
... 82.177.510 77 63,211,105 27
... 25,014,632 07 24,729.846 61
The civil service
Pensions and Indians.
War Department
Navy Department....
Interest on debt.......
Total gross e5timate......5593,346,321 48 $714,703,595 5S
But this amount, it was sup
posed, would remain un
drawnatondofyear, and
was therefore deducted
from the gross estimate.. 200,C00.000 00
Jdakingactual e5timate?*..5693,346,321 48
In bis last report, the Secretary state! that if the ap
propriations should equal the estimates, the balance un
expended at the end of the year would probably reach
$200,0(0.000, and that this sum should therefore be de
ducted from the departmental estimates to make the a? •
gregate correspond with probable conditions. The
above statement shows-that the aggregate of estimates,
thus reduced, was $093,346,321.43, while the expenditures
were $714,709,995.58, exceeding the reduced estimates
$21,383j 674.10.
I From the actual expenditures, $714,709,995.58, there
.mutt be deducted the actual receipts, $124,443,313.29, in
-order to show the amount derived from loans, $590,266,
•662.29, which sum. added to the amount of the debt on
the Ist July, 1862, $508,626,499 OS, (heretofore erroneously
stated at $554,211 371.92.) gives as the true amount of
debt t-n the Ist July, 1563, $1,093,793,181 37
The estimatea fo-r the current fiscal year 1861 next-claim
attention. These are founded on actual receipts and dis
bursements for the first quarter, which coded September
80, 1863, and on opinions formed upon probable events
.and conditions as to the other quarts rs
jThe following statement exhibits what is actually
. -known, and what, aftercareful reflection, the Secretary
+ thinks himself warranted in regarding as probable:
For the first quarter, ending September
30,1863, the'flcmalreceipts were:
From customs. $22,562,018 42
From internal re venue 17.559,713 69
From lands.-.a 136,182 09
'Fromniißsailaneous sources 641.642 04
Total actual receipts for first
I quarter ...$40,939,456 14
'To which add balance July -
1 1, 1863.- , - 5,329,044 21
.Jfakingfolal leceipta of first quarter, ex- _
cept loans $l5 268 oOQ 35
Fortbree remaining quarters, ending
on the3Uh of June, 1264, it is estimated
there will be received: _
From customs. $50,000, COO 00
From internal revenue 60 COO, 000 00“
From lands. 300,(00.00
Frommiscellaneoussources 6,000,000 00
5115,800,000 00
Slaking a total of receipts from ordinary
sources, actual and estimated, and in
eluding balance, of,»«,«* $161,568,600 33
To whien add the actual and estimated re<
ceiptsfroiu loans ■
Ka> ing a total of actual and estimated re
ceipts from allsourcee, forJB64 $755,568,500 35
The expenditures may be stated as fol
lows:
For the first quarter, ending September
30, 1863, the actual disbursements have
been:
Tor the-civil service $7,216,939 31.
Tor pensions and Indians. . 1,711,271 95
For war Department...... 144.357.473 97
Tor Navy Department...... 18,511.618 86
For interest on public debt. 4,283,628 37
Actual expenditures for first quarter..... $176,110,932 4$
For the remaining three quarters the
estimates, founded on appropriations and
estimated deficiencies, are as follows:
Tor the civil tervice.... $27,050,672 21
Tor pensions and Indians,. 6,129,0-12 86
Tor War Department....... 741,092.037 14
ForlTavyDepartment...... 94.467 667 74
For interest on Public debt. Jim 503 01 „
Slating a total aggregate of actual and
estimated expenditures of. .. ....$1,099,731,269 42
Bat as these estimates include all unex
pended balances of appropriations from
former years, they are necessarily much
too large, and there may be safely de- ;■
ducted fro 01 their aggregate, as likely
. to remain unexpended at the close or _ __
the fiscal year, theisura of. .•. ■• ■ • $350,000,000 00
BlLeaving the total actual and estimated • '
1 expenditures for 1864 $749,731,960 42
W 'The total of exoenditurea being deducted r
from>the to’al of receipts, there will be
i an estimated balance on the :10th of
June, 1564, of. $5,836,539 93
From this statement it appears that the
total rfcaipts required for the probable
disbursements of the year, and in
cluding estimated .balance at its close
will amount to. i * $750,£63 500 35
Of which there have been provided and •
applied during the first quarter........ 176,110,031 ‘l6
leaving to-be provided-
Of which It is estimated there will be re
ceived fo m ordinary sources dar'-ng
the three otter quarters 115,300,C00 00
leaving yet to lie provided by loans *1M,157,507 89
The amount of debt created during the anarter is
ascertained hr deducting from the total expenditures
*176,110,952 16. the aggregate of ordinary receipts and
balance from last year, amounting together to *40,265,-
600.85, which gives as the increase of debt *129,842,432.11.
To this sum. If there be added the sum yet to beprorlded
by loans. SUM. 157,667.69. the result will be *591.000,000,
from which, if there lie deducted the estimated balance
on the Ist or July 1864. $5,830,639 83,-the remainder will
be $689,163,460 07. and will represent the total increase,
on the DBBia of tktse estimates?, of public debt duringthe
year. Ibe deb: on the Ist of July, 1853, was $1*098.793,-
181.37; to'wbieh if this estimated increase be added the
total debt on the Ist of JaJy, 1861, will be $1,635,9)6,
641.44, instead of $1.744,635,6«G. 80, as Q3tiraited in the
report of last December.
It is not certain, or perhaps probable, that the actual
expenditure? or actual-debt will quite reach the amounts
now estimated. Indeed, if the expenditures for the first
quarter; $176,110,932.40, and the ordinary receipts,
*40,050,45614 for the same quarter, bo taken as the
standard, the total expenditures of the year will be
$764 443 729 S-l. and the total receipts $183,767 624.56. To
these receipts, if the balance on the Ist of July, 1853,
$0.b20,044 21. he added, it will, make the total ordinary
resources ®H9,C80.£68 77; and the subtraction of this anm
from the-tot3l expenditures will give the whole amount
to be provided bv loans during the yooras $W d, 3 j 6,811.07.
This sum will, there'olo. be, on this hypothesis, the in
crease of debt /or the year, and, added to the debt exist
ing on the let of July, 1883, will make the total amount
■on the 30th of June. iSB4, #1,634,150,G4144.
Jt is not impossible that vigor in the prosecution of the
War, and economy in every branch 01 expenditure, en
forced by wiee legislation, may reduce actual disburse
ments and I'onteqaent increase of debt av*n balow.iheie:
figures, andlrertatnly few things can bo more desirable
than snch ledoctlors. . .. ..
The nctiou necessary to these ronuts. is not. how
ever except as to the comparatively small expendi
tures of th» Treasury Department. within tho sphere as
islKMa to tu«-'SgeretOT' Be to accept
Estimated.
694,000,000 00
.4570,457,567 89
VOL. 7—NO. 113.
the estimates of the several departments, and the actual
appropriations by. Congress based apou thorn, deducting
only that proportion which experience has indicated as
likely to remain as balances u.nexpouded at the close of
the year. He thinks, too, that sound prudence requires
adherence to tho rule he Pj escribed to hitnself from the
first, of overstating rather than understating the bur
dens created by the war and the demands thence arising
upon the resources of the country. He lias sought to
avoid exaggeration on both Hides, but be has thought It
more prudent to exetio a little too much apprehension
than to encourage too sanguine hopes. The real riifiicnl
ties have been, and are, too serious, and the real bur
dens too great, notto warrant earnest demands on ail the
resolution, all the energy, all the wisdom, and all the
economy, which the strongest representations, sanction
ed by reason, could or can bring into action.
In addition to the estimates for the carrent year just
stated, the Secretary is required to submit estimates of
tbe receipts, and expenditures of the next fiscal year.
These estimates, always uncertain, must, in the present
condition of the country, be even less reliable than
-usual. .
Bat the Secretary is encouraged to attempt them by the
circumstance that the estimates for the fiscal year, 1664,
submitted in his report of December, 1862, are less ma
terially modified than might have been expected by the
actual receipts of one quarter, and by the probabilities
affecting those of the other three, and the general result
is more favorable 1 han was anticipated.
Tbe aggregate receipls for )S6i were estimated in that
report at $223,025,000, while the actual receipts, other
than from loans forthe first quarter, and the aggregate
of expected like receipts for the remaining quarters are
now stated at only *161,668,600 85, in consequence of the
large deficiency in the receipts of internal reveaae. On
the other hand, the aggregate expenditures were esti
mated last year at $845,413 183 56. and are now estimated,
on. the basis of actual returns for part and of estimates
for the remainder of the year, at $755,663,503 33. The
subtraction of receipts from expenditures -Shows the
amount now estimated as required from loans for the
year 1864 to be $594,000,000, in dead of i 622,353,183 .Iff, as
heretofore estimated. These figures show that the esti
mate of expenditures is now $59,844,683 21 less than the
estimate of last year; so that, although the ordinary re
ceipts' as now estimated will be $6l 4*6,499 45 less than
was anticipated a year ago, still the increase of debt
will bo $28,365,183 56 less by the present than by the
former estimate, which, it should be remembered, as
sumed the debt, on July 1, 1563, at $L 122,297 403 24.
whereas, in fact, it only reached, at that dale, the sum of
$1,098,793,151 37
With these ilhutiatlons of the uncertainty of estimates
for a year, which is to commeace more than six months
after the makiog of them, and without professing any
sanguineeipectations that the estimates now to be sub
mitted will, when tested by experience, prove, like the
last, less favorable to the country than the actual results
of administration, the Secretary sub mils the required
statement for tbe fiscal year 1865. founded on the esti
mates of their piobaiile requirements famished by the
several departments, and on what seem to him proba
bilities concerning receipts from ordinary sources of re
venue.
He 66tint>ates the probable receipts as follows:
Estimated balance, July 1, 1854 $5,836,539 93
From customs 70,600,000 00
From internal revenue 125.000,000 00
From lands 1,000,0C0 00
From miscellaneous 50urce5...........5,000,000 00
Making estimated aggregate receipts..., -$206,836,539 93
And he estimates the expenditures as follow*:
Estimated balance of former appropriations, unexpended
July 1,1864 $350,000,000 00
For the,civilservice. 27,973,194 Si
For pent-ions and Indians..... 9.631,304 73
For the-War Department. 636,204 177 77
For theNdvy Department. ...» 14?,6t8,785 40
For interest on public debt. 4 95.837 677 15
Making the aggregate of estimated ex
' penditnres.. ~„sl,lsi t Sls,C&S^S3
But he estimates as likely to remain un
drawn on the 30th Jane,U6s, and there
fore to be deducted from this aggregate.. 400,030,000 00
Making the real estimate of expenditures
for the year ‘.‘5751,815,053 86
From which deduct estimated receipts
from ordinary sources, as before stated. 205.826,539 93
heaving to be provided by 10an5..;*..., $54*,973,545 93
Tbe sum to be provided by loans represents the in
crease of debt during the year. Assuming, tnerefore,
the correctness of the estimate which puts the debt on
the Ist July, IStti, at $1,685,956,641 44, It will result,from
these estimates, that the whole debt will have reached
on the 30th of June. 3865. the sum of $2.2:311916,190 87.
Tables are appended to this report exhibiting, in more
ae ail and in a different form; ihe general results already
stated. The first shows the actual receipts and expendi
tures for the fiscal year ending Jane 30, 1863; the »econd,
the receipts and expenditures, actual and estimated, for
the fiscal year ending June 30,1554, and separately for
the two-months of October and November, 1833, with
notes, showing in detail the amount received from new
loans and applied in discharge of existing debt daring
the first quarter and the first two months of »he second,
and the amount yet required from loans for the year, and
the probable inci ease of the public debt; the third shows
the estimated receipts and expenditures for the.fUcal
year ending June 30, 1565; the fourth i 3 the Regi-ter’s
statement of revenue and expenditures daring the flscsl
jtar ending June >O, 1563; the fifth is a similar statement
trom the same office for the first quarter of the fiscal
year 1564 enoing September 30,. 1863; and the sixth is a
complete statement of the. origin, progress, and condi
tion, on the 30th June and 30th September, 1863, of the
national debt.
The reports of the heads of the several bureius of the
Department, including that of the Comptroller of the
Currency .and the Commissioner of Internal Revenue,
will also accompany this report of the Secretary. They
show in detail the operations of ihe several bureaus,
and the statements and suggestions made in them are
commended to the consideration of Congress.
.Another statement, showing the prices of the leading
articles of cojuumption at New Xork, on or near the first
day of each month, for thirty-nine years, commencing
withlSJo, has been prepared under the direction of the
Secretary, and accompanies this report From this
statement he hopes that some help may be obtained to
ward correct opinions on many important questions,and
particularly those concerning the contraction and ex
pansion of currency, whether metallic or paper.
It has bee a already seen that the amount required for
general disbursements, • exclusive of payments on ac
count of public debt, for the three last quarters of the
current fiscal year, was, on tae Ist of October last,
8679,467,£67.89, of which sum, $115,800 030 was expected
from ordinary sources, and the remainder, $464,157,567 89.
wsb expected from loans. -
The receipts and expenditures during October and No
vember, other than on account of principal of debc,
amounted each, as far as has bsen ascertained, to
*147,060,731 16, without balance. Of these receipts,
$35,629,703. IS were from ordinary sources, and SUI, 931,-
027. 9Slrom loans, either temporary or permanent, leav
ing t<y be obtained during the remaining seven mon* hs
from ordinary sources $79,670,296.82, and from loans,
$35*2,226,5£9 62.: On the basis of these two months, the
receipts and expenditures from ordinary sources for the
last three-quarters of the year wilL respectively exceed
the general estimates by $43.033.664.31, and $39,532,257.72,
making a difference in favor of the country of $3,501,-
*.6.59 1
The Secretary admits, therefore, no apprehension of
deficiency on comparison with estimates, in any of the
ordinary sources of income, except, perhaps, the inter
nal revenue: nor does he anticipate any formidable
difficulty in providing the amount to be obtained .from
loans if the successes vouchsafed by a gra
cious Providence to our armies during the last nine
months snail continue to attend them. ..
But no one can be more profoundly convinced than
himsell of the very great importance of providing even
a larger amount than is estimated from revenue. To
check the increase of debt must be, in our circumstances,
a prominent object of patriotic solicitude. The Secre
tary, therefore, while submitting estimates which re
quire large loans, and while he thinks it not very diffi
cult to negotiate them, feels himself bound by a pra
dent regard to possible contingencies, to urge on Oort*
giess efficient measures for the increase of revenue.
It is possible that .a limited additional amount of in
come may be derived f romijudicious modification of some
provisions of the laws imposing duties on foreign im
ports; but the chief reliance for any substantial increase,
and even for the prevention of possible decrease, must
be on internal duties.
The Commissioner of Internal Revenue recommends
an increase of the tax on Ebank-noie circulation to two
and two-fifths per cent.; aj increase of tne duty, on dis
tilled spirits to sixty cents per gallon; an increase of
duty on tobacco to twenty cents per pound on leaf, and
from five to twelve cedts, according to quality, on manu
factured; a duty of ten cents per gallon on crud * petro
leum: a duty of two cents per pouadon cotton; the re
peal of the tobacco and petroleum drawbacks; and va
lions other changes of the internal revenue laws, de
signed to augment the receipts from this sonree. In the
particular recommendations jusi mentioned the Secre
tary fully concurs, and commendß all his suggestions to
careful attention. The enactment of such laws as will
secure an increase of the internal revenue to the amount
originally estimated, ofone'hundred and fifty millions a
year, is required by ihe strongest considerations of pub
lic policy.
Hitherto, the expenses of the warjhaye beengdefrayed
by loans to an extent whichnothiog but the expectation
of its speedy termination could fully warranc.
In his fir<t r report, submitted at che special session in
July, 1861, the Secretary stated his conviction that, to a
sound financial cobdition, a system of taxation certain
to produce a sufficient revenue to pay the whole ordi
nary expenses of the Government in times of peace, and
the entire interest on the public debt, and to create a
gradually increasing fund for the redemption of its prin
cipal, was indispensable It was not important, bo long
as it seemed highly probable that the war would be
speedily brought to a successful close, that the revenue
should largely exceed the ordinary expenditures and
the interest. On the contiary;it seemed wisest toob*
tain the means for nearly the whole of the extraordi
nary expenditures by loans, and thus avoid the necessi
ty of any considerable increase of the burdens of the
people at a time when the sudden outbreak of flagitious
rebellion bad deranged their business, and temporarily
diminished their incomes
The financial administration of the first fiscal year
after the outbreak of the rebellion was conducted upon
these ideas The acts of Congress at the extra,session
of July,lB6l, were framed with the intention of supply
ing the full amount ol revenue demanded by them.
But receipts disappointed expectation,, and it soon be
came obvious that a much larger proportion of the
means needed for the fiscal year 1562, than the principle
adopted would allow, must be derived from.loans,
When, therefore, Congress assembled in. regular ses
sion on the first Monday of December, 1831, the Secretary
directed attention to the necessity of increased.taxation.
The responsibility was promptly assumed, by Congress
and the internal revenue law was enacted, and such mo’
difleations of the tariff! act were made that amnle-pro vi
sion for the desired objects was now supposed to have
been certainly secured. It was not expected, however,
that the influence of this legislation would, affect the re--
suits ol the then current year. Nor did it affoetthem,
The total receipts from ordinary sources to the close of
that year, June £0,1862, w«re insufficient for the pay
ments expected to be made from, them The receipts were
$51,^35-720.76 while the disbursements tor the-civil ser
vice, for Pensions and Indians, and for interest, were
$37,701 801.11; leaving only $14,2-3,919;65. for the War
and Navy Departments, the expenditures of which in
the last year of peace had been $27,922,917 2-1, and no
thing at all for extraordinary expenditures or a sinking
In his report at the December session. IS&3, the Secreta
ry, considering, this deficiency and assuming the cor
rectness of the estimate of $1(0,600,000 as the amount of
receipts from internal dutieß, and taking doable the-ex
pem es of the War and Navy Departments in the last
year of peace as the amount likely to be annually re
quired after the suppression of the reoellion, expressed
the opinion that the probable receipts under tho legisla
tion of the preceding session would meet ail ordinary
expenditures for the fiscal year of 1863, and interest* and
leave a laige surplus to be applied, fir tha preient, to
the extraordinary disbursements of the war, or, tfier
its close, to the reduction of debt. In that repor., the. e
fore, and in his subsequent communications to the proper
commits es, tbe Secretary suggested no increase of taxa
tion, but confined his recommendations to .other mea
sures for the improvement of the public credit, among
which thofc relatix g to loans and to uniformity of cur
rency held ihe foremost place. : ~, , .
Congress gave effect to these recommendations by the
loan act and the national banking act. but at the same
time somewhat diminished tha expectations of income
•by modifications of the internal revenue act.
Notwithstanding this dim nation, however, and not
withstanding the much larger diminution caused br the
failure ol receipts expeoted from internal duties unaf
fected by tbiß legislation, the Secretaryhasnowthe/ia
tisfaction of being able to show that th e actual receipts
of the last fiscal year did pay the,-whole interest, the
whole amount of ordinary expenditures, estimated for
the army and navy at double those of the last year of
peace, and a portion of the extraordinary expenditures
which, undtrthe circumstances, was equivalent to a
payment in the sinking fund.
Thus the total amount of receipts during
the fiscal year lSG3was $124,443,313 29
■White the expenditures were
For the Civil Service, and foiJPensiona and • •
Indians : $27,470,442 87
For interest. 24.729.846 61
And would have been for ordinary dis
bursements of War and Mavy Depart
ments, estimated at double those of the
last year of peace 65.815.834 48
• -$108,040; 123 06
Leaving difference between receipts and
ordinary.expenditures applicabte to ex
-18,397,139 83
Had it been possible, therefore, to suppress rebellion
and restore expenditures to a peace basis after oneyea?
of war, and beforo the Ist of July 18b2, there would
have been a balance on the Ist of July. Ices, of in ore
than sixteen millions of dollars applicable to the reduc
tion of debt. , - ■■ . . .
So, assuming as correct the estimates of receipts and uis
burttinsnts for tfce current year 1864, based on actual re
ceipts and expenditures of one quarter, aou making tus
total amount of receipts $l3l 563,600.35, and taking the dis
bursements for the Civil Service. Pensions, and Indians
to be $42,108,126. &3 fur interest, $59,165 136.38, and for the
.ordinary expenses of the army and navy, as before tj
bo double those of the last year of peace, 0r.553,845 S« -
48. and deducting the total of ? hose disbursements, $157,-
119,097 i‘J from the total of receipts, and theretvill remain
an unexpended balance of $4,040,403 10. flad it been
possible to suppress rebellion after two years of war,
and before July, 1863, this sum would have been appli
cable to the purpose of a sinking-fund. ; -
So, also, assuming again as correct the general esti
mates of receipts and exi>eaditares for the next fiscal
year, 186 f, the total receipts for the year will bo $200.-
£86.639.93; while the expenditures for the Rivil Service,
and Pensions and Indians, will be $37,604,499.64; for in
terest, $85,387,676.16; and for the army and navy ob
serviDK tbe rule alveady stated, $56,846,814.48 making
a total of $178,838,010.17, which sum\ if deducted from
the total of receipts, will give a. remainder of $27,993,-
629 76. Should the rebellion be suppressed after thres
venrs of war, and before the lirst of July. 1534, that re
maludei will be applicable topayment of debt.
These statements are subject to some moditicationsbe
sides those which may result from errora of estimate?;
but these cannot reduce, though they may Increase, the
applicable balances, and therefore cannot affect unfavo
rably any deductions from the flgares which have been
aSateinontßilluatrato the great importan«|-of pro
viding, beyond all contingency, for ordinary expend!-
turns aud it terest on debt, and tor the largest possible
amount of extraordinary expenditures,-by taxation. In
proportion to tliei amount tha .neowarj*
sums for ordinary demands will be the diminution of
doW, tuo dimimuioa oj jmteKUt, and tb« topwvsrant oi
credit. It is hardly too much—perhaps hardly enough—
toeaythat every dollar raised for extraordinary ex
penditures or reduction of debt is worth two in tho in
creased value of national securities, and increased fa
cilities for the negotiation of indispensable loans.
These statements illustrate equally the importance of
flu economical and vigorous proaecatlon of the war. No
prudent man Will recommend economy at tho expense of
efliciei cy. Such nominal economy is real extravagance.
But efficiency is not promoted by profusion, or waste,
andSleait of all, by misuse of public money or public
property. Every dollar and every man are freely offer
ed by a generous people; how 6acred the obligation that
notone man should bo wasted, and noloue dollar mis
applied. Nor is rashness. in war, vigor. But the
vigilance that misses no opportunity, the energy that
relaxes no effort, the skill that . vitalize* all re
sources, and the perseverance that never grows weary—
these make true vigor If by such vigor the rebellion
can be suppressed, and the war ended before the Ist of
July next, the country will be saved from the vast in
crease of debt which must necessarily atteud its continu
ance during another year, and the debt itself can at once
be placed in a course of steady reduction. And when
ever progressive payment shall begin, the value of na
tional securities will rapidly rise, and reduction in
rates of interest will gradually diminish, tho hardens of
debt.
While the Secretary thus earnestly urges that the
largest possible proportion of expenditure d* provided
•by. diiect contributions from the property and incomes
of the people, he is aware that n still larger proportion
must, as yet, be provided by loans.
In the creation of debt, by negotiation of loans or
otherwise, the Secretary has kept four objects steadily
1° \iew: (]) moderate interest? (2) general distribution;
(3) lutur© controllability ? and (4) incidental utility.
Towards tho accomplishment of the first object, the
nearest approach that seems possible has been made.
The earliest negotiations were at the highest rates of in*
terests for it is a distinguishing characteristic of oar
financial history in this rebellion that the public credit,
which was atithe lowest ebb in the months which pre
ceded its breaking out, has steadily improved in the
midst of the terrible tria’s it has brought upon the coun
try. Tbe first loans were negotiated at seven and thirty
hundreaths per cent,; the next at seven; the next at
six; more recently large sums have been obtained at five
and four; and the whole of the debt which is repre
sented by United States notes and fractional currency
bears, of course, no interest, -
The interest on the debt which exists'in tho form of
treasury notes and certificates of indebtedness or of de
posits, and is called temporary debt, is paid in United
States notes; while the interest on debt which exists in
the foim of bonds, and is called funded debt, is paid in
coin—a diecrimtiatlon which is intended to bring the
payments of coin interest withiutaoderate compass,and
at the same time to offer special inducements to invest
ments in bonds, in order to avoid a too rapid increase of
circulating notes and consequent depreciation.
The average rate of intereston the whole debt, without
regard to the varying margin between coin and notes,
was, on the firatjday of July. 1862, 4.3Bper centum; on
the first day of January, 1853, 401 per centum; on the
first day of July, 1563, 3.77 per centum; and on the first
day of October, 1563. 3 95 per centum.
it will not escape observation that the average rate is
now increasing, and it is obvious that it must continue
to increase with the increase of the proportion of the in
terest-bearing to the non-interest bearing debt. And as
the amount of the latter, consisting of United States
notes and fractional currency, cannot be materially
■ acumen ted without evil consequences of the most serious
character, the rate of interest mast increase with the
debt, and approach continually the highest average.
That mast be greater or less in proportion to the duration
and cot t of the war. •
The general distribution of the debt into the hands of
the greatest possible number of holders has been the
second object of the Secretary In its creation. This has
been accomplished by the universal diffusion of United
States noteß and fractionalcurrency, by the distribution
of certificates among great numbers of contract creditors
and temporary depositors, and by arrangements to popu
larize the loans by giving to the people everywhere op
portunities to subscribe for bonds These subscription
arrangements have been especially useful and success
ful. They have been adopted as yet with reference to
/only two descriptions of uonds—the two commonly
known as seven-thirties and five- twenties, t o named, fhe
first, from tholr rates of interest, and the second from
theirperiods of payment. The plan of distributingthe
seven-thirties was that of employing a large number of
agents in many places, and directing their'action from
the Department.. It worked well for a time, but was
soon found inadequate to tbe financial necessities of ihe
Go reminent. For the distribution of the fi ve-twentie?,
there fore,a different plan was adopted. After ascertaining
by inquiry tbit they could not be disposed of to aapi
ialistsin amounts sufficient for prom&t payment of the
army and navy t snd for the satisfaction of the. just
claims of public creditors generally, without serious
lost, the Secretary determined to employ a general
agent, under adequate bonds, and confide the whole
work of distribution, except so far as it could be effected
by the Treasurer, Assistant Treasurers, aud Designated
Depositors, to him and to sub agents designated by him
and responsible immediately to him Under this plan,
and chiefly through the indefatigable efforts of the gene
ral agent and his sub-agents, five twenty bonds to the
amount of marly four hundred millions of dollars, in
denominations of fifty, one hnndred, fi ?e hundred, and
one thousand dollars, were distributed throughout She
whole eountry not controlled by the rebellion, and
among all classes of onr countrymen. The hisiory of
the world may be searched, in vain for a parallel case of
popular financial support to a national Government.
'Jhe Stcretary is unable to perceive in what batter or
more effectual mode the important object of distribution
be accomplished, and he proposes no departure
from.it, except such as considerations of economy, har
monized with efficiency, may suggeit.
The object of future controllability has also had a pro
minent place in the regards of tbe Secretary. Under
the conditions which existed at the outbreak of the re
. bellion, he acquiesced in the necassity which seemed to
dictate the negotiation of b nds payable after twenty
years; but he acquiesced with reluctance, and, as soon
as permitted by circumstances, recommended the enact
ment of Jaws authorizing the issue of bonds payable
after shorter periods, as well as the creation of temporary
debt in other forms. In harmouv with those viows
Congress provided for the issue of ihe bonds known as
the live-twenties; and--ai3o for the issue of treasury -
notes payable three years from dace; for certihcuoj of
indebtedness payable in.one year; and for temporary
loans by deposits, reimbursable after ten days’ notice.
At the last session Congress repealed some embarrassing
restrictions of former acts, ana authorized the issna of
bonds payable, after ton years, and of treasury notes
payable at pleasure or three from dat*. These
treasury notes were made legal tenders for face value or
convertible, for amount and interest into Untied States
notes. '
The Secretary availed himself of this legislation by
placing with the people as large an amount as possible of
live-twenty bonds, and byu6ing the other powers so as
to put the whole debc, except the long loans first negoti-.
ated, in such a shape that prompt advantage can be
taken of'favorable circumstances to diminish the bur
dens it Imposes oi industry. Whenever the constitu
tional supremacy of the nation shall be re-established
over all its parts, it w;ll be completely within the power
of Congress and the Secretary to’fund the whole or any
part of the temporary debt in bonds bearing a very mo
derate interest, and redeemable at the pleasure of the
tho Government, after very brief periods, o*. perhaps,
at any time after their issue. Nothing further seems de
sirable on the score of controllability .
The final object o 1 the Secretary was to extract from
tbeunavoidab.e evil of debt as much incidental benefit
as possible.
To this end, he desired authority to>recaiva temporary
loans in the form of deposits, reimbursable after,a few
days’ notice. This measure was retarded by many with
something less than favor at first; bnt Congress, after
full consideration, authorized the receipt of such depo
sits, at an interest not exceeding five per cent., to the
amount of twenty-five millions of dol ars; then raised
the limit to fifty millions, and then to an hundred mil
lions; and provided a reserve of fifty millions of United
States notes to meet demands for reimburßerninis beyond
other convenient means of satisfaction. It was not long
before the: e deposits reached the highest limit, and, be
fore the Aow could be well checked, somewhat exceeded
it. The utility of tfia measure was very conspicuous on
the recent occasion of great stringency in New York,
when the Secretary was able to reimburse over fifty mil
lions of these deposits during the last weeksbf the year; :
by which action the pressure was sensibly alleviated,
with the use of only a fifth of the reserve.
In former reports the Secretary has stated his convic
tions, and the grounds of them, respecting the necessity'
and the utility of patting a large part of the debt in the
form of United States notes, without interest, and adapt
ed to circulation as money. These convictions remain
unchanged,'and seem now to be shared by the people.
For toeifiret timein our history has a real approach to a
been made; and the benefits of it,
thbugh still far from the best attainable condition, are
felt by all. The circalationhas been distributed through
out the country, and is everywhere acceptable- It is a
gratification to know that a tribunal so distinguished
by the learning and virtues of: its members as the Su
preme Coutt of New York has given the sanction of its
judgment to the constitutional validity of the law.
So, too, real and great advantages are derived from the
wide diffusion of the debt among tbepeople, through bu
siness transactions, and through the exertions -of the
officers of the Department and the agents for loans, al
ready noticed. ...
It is impossible to estimate the advantages to national
unity and national strength secured by thiß distribution-
Every holder of a note or bond, fromm five-cent frac
tional note to a five-thousand-doHar bond, has a direct
interest in the security of national institutions, and in
thestability of national administration. And it is an
other and no small advantage of the distribution, that
the burdens of debt, always heaviest when loans are
held by few, and especially.by foreigners, diminish ia
propoitionas the receivers of interest become identified
with the payers of taxes. • . . _•
Another incidental good growing from the bitter r >ot
of debt has been fully explained in observations hereto
fore submitted on the national banking system. Ex
cept through such a system, no sure way is seen to the
complete and permanent establishment of a uniform cur
rency; and a system of national banking, fair to all and
secure for all, can only be safety and firmly established
by making use of a portion of the national debt as secu
rity for thenationnl currency.
In these several ways majKeven such great evils as are
brought upon ns by rtbellion be transmuted, by a wise
alchemy, into various forms of utility. The Secretary
has endeavored to use this alchemy, with what success
the country will j ndge when time and trial shall have
app'ied to hiß work their unfailing tests.
additional loans sre repaired, and, aslegla
latiTO now stands, several modes are open.
The limits of deposits for temporary loan are fixed at
one hundred millions of dollars.. The amount of Ahia
deposit on the first day ol December had been reduced to
$4-5.5(6,120.01, and payments of $10,000,030 had been made
from the reserve. The additional payments will bj con
fined within the narrowest possible limits, and can
hardly exceed tweoty-ftye millions.' The reflow of de
posits has already begun, and will probably soon exceed
reimbursements, and so arrest payments from the re
serve. The whole reflow beyond the amount of these
pay ments will be available as part of the additional loan
requiied, and may be stated, without much risk of mis
take, at twenty-five millions of dollars. The Secretary
perceives no solid reason for retaining the restriction on
loans, in this form, to one hundred millions. It may, as
be thinks, be usefnlly removed!. As the advantages of
these deposits become better and more generally under
stood, tbe loan iu- this form-will, doubtless, in the ab
sence of restriction, be largely increased, and the possi
bility of demands for reimbursements, bevond means to
meet th»m, can be fully provided for by an increase of
the existing proportion between deposits and reserve.
Such an arrangement, the Secretary inclines to think,
i would operate beneficially by increasing the amount of
currency when unusual stringency shall require in
crease, and reducingits amount when returning ease
shall allowurednction. / , ,
Another portion of the additional loan required may
be obtained through the- sale of the remainder of the
bonds known as five-twenties. The amount of these
bonds unsubscribed for on the first of December was
$1 1,059,600. It willnotbe difficult to dispose of these at
par, and it is possible that a small premium may be ob
tained on apart. ■ ~ 4 , ,
In a former report, the Secretary placed the limit to
which the loan in the form of certificates of indebtedness
could be carried, at one hundred millions of dollars
Experience has shown that it can be carried to one hun
dred and fifty millions, and that Its natural limit is
about that sum. On the first of December the amonnt of
these certificates was $145,720,0C0. It would he unsafe,
therefore, to rely on any substantial increase of loan in
Tbe limit prescribed by law to the issue of United
States notes has been reached, and the Secretary thinks
it clearly inexpedient to increase the amount, when
circulation exceeds the legitimate requirements for reel
payments and exchanges, no addition to its volume will
increase its value. On the contrary, such addiiion
tends inevitably to-depreciation; and depreciation, if
addition be continued, will find its only practicallinnt
in the utter worthlessness of the augmented mass..
When Congress authorized the creation of debt, to a
certain extent, in the form cf United States notes, and 1
impressed on these notes the qualities , of a circulating
medium,, its action was justified by the disappearance of
coin in consequence of the suspension of spasie pay
ments ; by the necessity of providing a medium in which,
taxes could be collected, loanß received, and payments
made; and by the obvious expediency of providing that
medium in the lorm of national issues instead of resort
ing to the paper of banks. Under the circumstances, its
action was wise and necessary; hut it was equally who
and necessary to limit the extent of the issues by the
necessity which demanded them. They were wanted to
fill the vacuum caused by the disappearance of coin a.nd
to eurply Ibe acditionai demands created by the in
creased number and variety of money payments. Con-
Kiess belitved thatfoiw hundred millions would suffice
fi r these purposes, and, therefore, limited Issueßtothat
6 *The Secretary proposes no change of this limitation,.
ai.d places no reliance, therefore, on any increase of re
sources from increase of circulation. Additional loans
in this mode would, indeed, almost certainly prove
il'uEory; for diminished value could hardly fail to neu
tralize increased amount. ' ,
fcnfficient circulation having been already provided,
the Government must now borrow like any other em
ployer of capital temporarily.requiring .more than in
come will supply, and rely for the credit which will se
cure advantageous loans upon good faith, industrial
activity, accumulated thoughnot immediately available
capital, amt satisfactory provision for punctual payment
of accruing interest and ultimate reimbursement of
principal. lt _
To subscriptions for the remniningfive-twentles and
deposits lor temporary loan, therefore,must ba directed
all reasonable expectation of means fOT ihe service.of the
current year, except from negotiations uuder the act of
Jastscesicn. Thosumstohe looked for from these two
eonms have already been stated, and amount to $126,*
OC9 6(0 Iftbisaggregiitebededacted frorn the amoimt
lo be provided by loans for the last
current year, already shown to be $052,226,539,
will jemain tne sum of $2i6,1C6,&D9 to bo provided.by
: negotiations under.the act of last session: and, under
eome like act, must be provided in like manner, if the
continuance of the war shall make it nece<s-»ry,_ the sam
-of s64* 978.648 93, estimated as likely to be required from
last tho loans supposed to
he required for the fiscal years of 1E53 and 1864; and. of
ihe amount required for the service of these two years
to the first of December now current, one hundred'.and
fifty millions in United States notes, and fifty millions
by a ioan for two yesrs five per cent, treasury notes
bfrve alrrady been provided under that
a» tis so wall cniceiTPd and expressed that llttio other
KtfllSttSftor th “Si« -of ISM Lnd JS6S will be paired
then the application to those Years of Us loading pro
visions.' It will doubtless be thought thia.
i se»sioD, as last seseiou, to authorize tbe borrowing, in.
a* me form, of three hundred millions ,or the current,
and six hundred millions for the next, flsoal year. I?*
r deed, the only modifications of the act of last session
{ - bvUptUtotfi.9 rsquiMUW&teor tas
PHILADELPHIA, FRIDAY, DECEMBER 11, 1863.
and coming year se*m to be: (1) the omission of all re
ference to United States notes beyond the giving a simple
authority to the Secretary to ascertain from time to time
the amounts destroyed or lost, and to replace them by
new issues; (2) the repeal-of the existing limitation of
the deposit loan to one hundred millions of dollars, and
the substitution of a provision for & reserve equal in
amount to half the deposit; (3) the permission of the ne
gotiation of loans redeemable absolutely at pleasure, or
atpleasnre after a time fixed, not more remote than
forty years: and (4) the omission, perhaps, of tha.clause
taxing circulation and deposits, as being more appro
priate to an internal revenue bill. It is hoped that tbe
other provisions of the latt maybe retained in the new
loan act.
Under such legislation, the Secretary entertains littlo
doubt of being able to obtain whatever funds will .be
needed, through loans, at reasonable rates of interest,
for bonds or treasury notes.*
For a warrant of this confidence, however, he must
not omit to Eay that he relies much on the support to be
Riven to tbe public credit by the national banking sys
tem, and by the nationalization of the currency. There
is. as he thinks, no possibility of & permanently success
ful administration of the finances, under circumstances
involving the creation of large debts, unless loans can
be effected in a medium of general and equal credit
throußhoat tho country, and not liable to variation in.
quantity or in value except under the operation of na
tional legislation t>nd the general laws of trade.
Only two kinds of currency fulfil these conditions:
the first, a circulation of coin; the other, a circulation
of notes of uniform'd ascription and value, issued by the
Government, and either paid directly to Government
creditors, or supplied to banking associations to be em
ployed in general business.
The circulation, now generally used in this country,
except so far as it consists of bank notes, is of the latter
sort* and no circulation, not immediately convertible
into coin, can be bettor.
It is an error to suppose that the increase of prices <is
attributable wholly or in very large measure to this cir
culation. Had it been possible to borrow coin enough,
and fast enough, for the disbursements of the war, al
most if not altogether the same effects on prices would
havebeen wrought Such disbursements made in coin
would Lave enriched fortunate contractors, stimulated
lavtih expenditures, and so inflated prices in the same
way and nearly to the same extent as when made in
notes. Prices, too, would have risen from other causes.
The withdrawal from mechanical and agricultural occu
pations ef hundreds of thousands'of our best, strongest,
and most active workers, in obedience to their country’s
summons to the field, v> onidunder any system of curren
cy, have increased the price of labor, and, by consequence,
the price of tbe products of labor; whiLe the prices of
many things would have risen, in part from, other
causes, as for example, theprico of railroad bonds from
vast increase of income, through payments for military
transportation; and tbe price of cotton from deficient
sujply.
hluch the greater part of the rise of prices not account
ed for by the causes just stated, as well as much the
greater part of the difference between-notes and gold, is
attributable to the large amount of bank notes jyet in
circulation. Were thoee notes withdrawn irom use, it is
believed that much of the now very considerable differ- ;
ence between coin and the United States notes would dis
appear. Certainly there ought to be no difference.in
favor of coin, when it is remembered that Untied States
bonds bearing six, or even five, per cent, coin interest
aie intrinsically worth, unless the theory of-national
hid faith or national insolvency is to be admitted, more
than their amount in coin; and yet snch bonds can now
be bad for their amount in Untied States notes.
&or can a condition of affairs m which excessive prices
prevail, or national notes command less than par in coin,
be regarded as of permanent duration. While it lasts, it
. must be borne'with patience, and made tolerable by eco
nomy. Ho useful remedy will be found in extravagant
increase of salaries and disbursements, but. an aggrava-:
tion rather of the evil. All proper measures should, be
adopted to hasten the return to the normal- condition of
prices and business; the patriotism and intelligence of
the people must be relied on for the rest
The Secretary has heretofore expressed the opinion
that whatever may be the true degree in which the cur
rency of the country is affected by a bank-note circula
tion, issued without national sanction and by corpora
tions independent of national authority, and not receiva
ble for-national dues, it cannot be questioned that in
some similar degree, • the negotiation of national loans
must be prejudiced,' and their value to the national
finances diminished. This opinion is confirmed by obser
vation and experience.
Impelled, therefore, by a profound sense of the present
necessity of a national currency to the successful prose
cution of the war against rebellion, and of its utility at
all times.in protecting labor, cheapening exchanges,
facilitating travel, and increasing the safety of all busi
ness transactions; and at the same time unwilling to
urge even salutary and necessary reforms in such a way
as needlessly to disturb existing conditions lor impair
the value of existing investments of capital, the Secre
tary recommended, in two successive reports, the autho
rization of national banking associations, to which the
capital of the corporations now issuing notes for circula
tion might be transferred, with advantage to ths parties
in interest as. well as to the general public.
The sanction of Congress was-given to these views at
the last session: and the simple assurance thus given
that, henceforth, the country is to have a national cur
rency. secured by a pledge of national bonds, and the
belief that this currency will, at no distant day, take ihe
place of the heterogeneous corporate currency which has
hitherto filled the channels of circulation,- at once in
spired faith in the securities of the Government, and
more than any other one cause enabled the Secretary to
"provide for ihe prompt payment of the soldiers and the
public creditors
If tbe policy thus indicated shall be fairly and judi
ciously pursued* and proper measures adopted to induce
the convert ion, at the earliest practicable period, of the
bank corporations of the States into national thanking
aseociat ons, and of the corporate circulaiioninto na-;
tional currency, the Secretary believes, and, as he
thinks, not without good grounds, that all the money
nfeded for prompt payment of troop 3, and for the most
vigorous prosecution of the war, can be obtained by
loans on reasonable terms; while all interest on debt,
and all ordinary expenditures, and a considerable'part
alto of the' extraordinary expenditures .caused by this
war, will ba met by the ordinary resources. Nor does
he doubt that, through wi«e.leiislation, sustained by in
telligent popular will, and supported by prudence and
energy in ciflil and military administration, national
cuirency canbeso approximated in recognized value to
coin that a resumpuon of payments in specie can be
brought about much sooner than even sangaino persons
now permit themselves to hops.
. The Secretary has already referred in general terms to
the reports of the heads tf the various bureaus and
b) anches of administration in his Department A pecu
liar interest is felt at this time in their operations, and
especially in the operation of those moat recently
brought into existence
The Comptroller of the Currency reports the organiza
tion under the national banking act, prior to the 20ch of
November, of one hundred and thirty-four sssociations;
all which,'upon the suggestion of the Secretary, have
adopted the name of Naiioual Banks, distinguished by
order of organization and by locality. These banking
associations bavedieen formed in seventeen States, and
the District of Columbia, and have an aggregate capital,
of s2b‘,OS3,fCo- The great care and labar required for ihe
preparation of suitable notes for the new national cur
rency hag delayed its issue beyond expectation j but the
printing is now begun, and the severa* associations will
be supplied with the amounts to which they arereapec
tively entitled within a few weeks. Besides the asso
ciations reported as actually organized, there are many
others in process of organization. There is hardly a
State cot controlled t y the rebellion, and'hardly a con
siderable city, in which a national banking association
has not been organized, or is not being organized. Sven
New Orleans is not an exception to this statement.
Thus the great work of introducing a permanent na
tional currency has been entered upon in a spirit and
with an energy which promise perfect success. The
Secretary thinks he risks nothing in saying that, within
the present 5 ear, the benefits of the system will have so
Reproved themselves to the sense and patriotism of the
people, that it will be beyond the reach;of successful
ascault. ~ „ , .
The Comptroller has indicated some amendments to
ihe law which the Secretary concuts]with, him in regard
ing as important to its success. As among the most es
semialof these, the Secretary asks the special attention
of Congress to the proposition for a uniform rate of inte
rest, and the repeal of the section which connects the
issues of national currency in. any degree with State
banks. The Secretary also recommends, aslikelytobe
useful, a provision to he made bylaw for the deposit
with national banks, and also with the Treasurer and
Assisiant Treasmers, at such rates of interest and for
such periods of time as the Secretary may prescribe, of
moneye paid into or invested under the orde s of j udicial
courts. It is not impossible that in this way many mil
lions would he placed in the treasury at moderate rates
of interest, ; .
The Secretary has already referred to the recommenda
tion of the Commissioner of Internal Revenue, in favor
of Increased duties. Be cannot add anything to the
general considerations ho has already urged in favor of
augmenting revenue by these methods. H may be use
ful, however, to invite special attention to some con
siderations which enforce the recommendation of a duty
of two and two-fifths per cent, a year on corporate note
circulation.
The proposition contemplates a duty of one fifth of one
per cent, per m >nth on circulation: and the Secretary
suggests, in addition, one twenty-fifth of one percent,
on deposits in each month, making twelve twenty-fifths
a year. Under the existing law the duty on circulation
is one percent a year on a certain proportion; two per
cent, on amoants exceeding that proportion, and one
fourth of one per cent, on deposits. The small addition
proposed will not be regarded as unreasonable or one
rous. when it is considered that ail corporate circulation
is in fact a loan by the people to the banks cost,
except that of preparation, and without interest, except
the duties imposed on it. The whole question then re
vives itseli into this: Is the duty proposed, added to
the Slate taxation, and the cost of preparation, more
than equivftleDt to a fair interest for the loan ? If not,
smeJy it should be paid withoui’demur as a leasoaa
ble contribution to the common welfare. The duty pro
posed on deposits is much lighter for obvious reasons.
its whole amount is lees than one half of one per cant,
per annum; and being in the natnre of a tax on profit?,
rather than on property, will distribute itself among all
who partake of the benehtg of the deposits, and press
hardly on none. .
Itisproposedto make the duty payable in small percent-,
ages, because it will be thus distributed over the business
ofibeyear; and, because, by requiring monthly returns of
circulation and deposits with reference to the duties, in
formation will be regularly obtained in respect to the
amount of circulation of all descriptions in the whole
-country the publication of which will be an important
benefit to all men of business, as well as a valuable
guide to financial legislation and administration.
monthly returns are now required of many of the na
tional banking associations, and should be required of
all; and from them, as well as from the banks not organ
ized under national legislation, should be required a
fair con-ributlon to the general burdens of the oeopte.
The Secretary refers to Congress the question, whether
the duty on national currency, and the deposits of na
tional banking associations, shall correspond with the
duties on other circulation and deposits. He thinks that
for the present, at least, some discrimination in. favor of
the.national associations may be properly admitted in
consideration of the indispensable importance of a na
tional currency, not adapted, only. Hire United States
notes, to temporary- emergencies,. but. permanent in its
very nature, and adequate to all demands of business,
ai d capable, at no distant period, of being made equal
to and convertible into coin, and therefore its real repre
sentative and equivalent.
The operations of the Mint have been of less import
ance than usual during the last year.
The amount of coinage was increased over that of last
year at San Francisco alone. The value of the bullion
received $24. 824,101 31; in gold $23,149,495 41; and in
silver $1,67'4,605.90; from the total of which, must be de
ducted the bars made at one branch, and deposited for
coinage at another, making the actual amount deposited
$23,701,837.31. Thecoinageof theyearwass24 688,477.12;
of-which $20,695,552 was gold coin; $1,919,877.90 gold
baTs; $1,174,092,80 silver coin; -$390,204 42 silver bars;
and $478,450 cents. Of this coinage 'sl-181,497*37 in
49 108.402 pieces was effected at Philadelphia; $18,551,-
59S.eSin 2,872,173 pieces at San Francisco,.and $2,137,-
642.82 in 3.404 gold and silver bars at New York. -
The branch mint at Denver has been organized and pnt
in operation during the year, but its operations are con
fined, for the present, to melting* refining, assaying - ,
and ttamping bullion. „ ,
A report has been made on a sice for a mint in Nevada,
and measures will be taken for its establishment as soon
as possible. '
The Secretary renews the recommendation of prece
ding i eporta in relation to the universal- measure of com
m*-Tcial values by an International decimal coinage.
The operations of ihe treasury proper, have reached
unprecedented magnitude. These are conducted under
the direction of the secretary, by the treasurer, the as
sistant treasurers, and the-designated' depositaries, by
whom moneys which come into or go oat of the National
Treasury are received and - disbursed. As receipts and
payments have increased in number and amount, and
aseumed new forms, the labors and responsibilities of
these officers have taken vaster proportions of magnitude
aid importance. The general operations of the year are
seen in the statements already made of Receipts and Ex
penditures, tut no general statement can convey an ade
quate idea’ of then - variety, extent, and perplexity.
The labor, and car« , and anxiety incident to the borrow
ing, receiving, and paying of the sumsiecesiary to meet
the* debt becoming due during the year; or, in other
words, the making and applying of the loans necessary
to the renewing of maturing loans, make little show in
the report, and yet embrace transactions, often complex,
and necessarily multitudinous, which reached, daring
the year, an aggregate of more than a hundred and
eiihty-one millions of dollar*. The responsibility aad
labor of the whole! money operations of the Treasury
may be inferred from this statement concerning a com
paratively small part. . ' . • , .
The receipts at the office of the Treasurer in Washing
ton during the last fiscal year were $1,348,029,543.93, aud
the disbursements $1 334,615,175 67. At the office of
the Assittant Treasurer in New Fork the receipts were
63, and the disbursements $622,542 627.92. At
the t files of the Assistant Treasurer in Boston the receipts
were $118,900.(00, and the disbursementssll6,7so,ooo At
tl-e cflice of the Assistant Treasurer in Philadelphia the
Yecßiut* were $ll3 245.031.27, and the disbursements
'ihe receipts and disbursements at the offices of the
Assistant Treasurers at San Francisco and Bt. Louis, ■
and of the Designated Depositaries, especially at Balti
iru're, Cincinnati? and Louisville have beau lai’ge be
yond precedent, imposing labors and responsibi.itea
coueFpondiDßly large. The secretary cannot express
too strongly his satisfaction with the manner in which
theta officers have generally performed their onerous
and mnAifoim duties. • • t . . .
‘J be act of Congress relating to captured and abandoned,
property, approved March i 2. 1863. and the proclama
tion of the President of the 3lstof the same month, de
volved upon the Secretary tho-duty of regulating com
mercial intercourse* in conformity with the acta of- July
13 'B6l and May 20, 1562, aDd under license of the Pre
sident. between the States Aaq'ared to .he.in : insurrec
tion and the other States of the Union; or, touso the de -
scription commonly employed, between the rebel aud
" the loyal States. This duty'has been found exceedingly
Biducuß and perplexing. - - ■ • -
Prii r to the act and proclamation of/March» the Secre
tary bad attempted soma restrictive regulations with, the
view of preventing supplies to rebels rbut the state of
the law, and the terms.of tho original prcnlamation,
made it difficult to act'with much efficiency or useful
ut:*F, and the of ihe trade was assumed al
most exclusively toy the military authorities, Immedi
ately, however, on' the publication of the proclamation
of March; the Secretary issued regulations of. hade,
frsmed on thq best information and with the best con-,
sideratioa ho was capable of giving them; and earnest
and pers6veiln g endeavors were made to bring the whole
subject under lh.ehr coi.trol and under proper supervi
sion. Experience revealed defects in the regulation",
and they were revised, amended, and republished in
; The subject is too vast and complicated, the appetite
i tot mil too eawt a sA wetlog, aa<lUw tojatistwa
ol all restraint, however salutary or del 'essary, is too
great'to allow any hope of avoiding man y and some
times just com pi iota. Bat the has kept
steadily, in view the plain duty prescribed by ?'
preventing any supplies from being carried inti l , districts
controlled by rebels; the equally plain duty t'i allow*
ing and securing, so far aB practicable, }u
teicouree with rebels, supplies of necessaries to the in
habitants of districts in which the rebellion has ’ ireem
suppressed; and the clear policy-of supporting And
facilitating the efforts of loyal citizens to obt.'tD»
wherever obiainable, without going beyond .'he
lines, of national military occupation, cotton, snga'r,
tobacco, tar, rosin, and such other products.of the rebe'l
Slates, for the benefit of loyal commerce. To this end
be bas'selected persons of known intelligence and pro
bity as supervising special agents, and through them
others of libo character as assistants and local special
aiente, to exercise the necessary powerover intercourse,
and has imposed, with the sanction of the President,
acd as conditions of license, such fees and contributions
on th e trade permitted as were thought necessary to de
fray the cost of supervision, and add something to the
means for the prosecution of the war. Tj&e'agents of all
grades have generally been diligent and faithful in the
discharge of their several duties. Af*w of subordinate
fti&de have proved incompetent or unworthy," and have
)een dismissed; and the same measure will be promptly
applied to all, of whatever grade, to whom pnDlic duty
may require its application. '
By an order of the Secretary of War Is Basil on tho last
of October last, the .care of anaadoned plantations and
oimr real estate has been devolved upou.thesapervieing
dgfnts,.who ; baye .been Instructed to accept the charge
and use their best endeavors in its execution. The
Charge Of RDftndOhed lands and plantations necessarily
carries with it, to some extent, ihe charge of freedmen.
- J ,be w'buie charge is at present under military sanction
only; for the acts-of Congress concerning abandoned
property, relate exclusively to personalty. The order is
of too recent date to allow receipts of reports concerning
its practical effects. It is only very clear that some sys
tem should be adopted and steadily pursued which will
best Berve the great objects of restoring tranquility,
order- and prosperity to the States and parts of States in
wh Ich the n ation al authority is or may be re • established,
and at the6ame time securing the righiis and welfare ofr
the loyal and enfranchised people. Tb these result.* the
labors of the Commissioners of Direct Taxes, as well as
judicial action, under the acts relating to confiscation,
must largely contribute. Already, tinder the sales for
direct taxes in South Carolina, considerable prooart es
divided imp small tracts have passed .into loyal posses
sion, and are cultivated successfully by the labor of
frtedmen. Iffthis connection tbe Secretaryasks permis
sion. to repeat a sugßestion heretofore made, that the
proceeds ot cotton-raised by the freedmen before emanci
pation, and collected from those properties, should bo
applied in some judicious way for’the benefit of those
who raised It. The whole subject will doubtless com
m*Dd the attentive consideration ofrCongress.
The important and responsible duty of securing and
keeping, undor the dirtetion of the President and War
Department, commutation money from drafted citizens,
hߣ been assumed by the collectors of internal revenue,
at tbe instance of tbe Secretary of. War. In the judg
mentof the Secretary of the Treasury, this money should
be paid directly into the Treasury, and drawn out upon
requisitions for Ihe purposes to which it is appropriated
bv CoEgiess. The Secretary.of War thought, however,
that the other mode of collection--and disbursement
would be less burdei some to drafted men and more con
venient for the payment of substitutes His.wlßh.es
weie promptly complied with, and the whole matter is
i ow submitted to Congress >
Under a resolution, of. the Senate, adopted on the 12th
of March last, the Secretary has taken measures forthe
preparation erthe fullest etalement possible, with ex
isting means of information, of the foreign and domestic
commerce of the United S:ates; including that of the
Pacific coast. The learning and ability of the gentle
men; employed in. this work warrant the expectation
that a very instinctive accounftwlll be obtained of the
condition and prospects of our foreign commerce from
and to the Atlantic and Pacific coasts, as well as over
land, northward and southward, and of our internal
and inter-State commerce, including the trade between
loyal and rebel States, and between the bread producing
and gold and silver producing districts of our country.
The materials for a proper Statement of this internal
commerce must be sought in reports of State commis
sioners of statistics, of boards of trade, of railroad and
canal companies, and occasional or periodical publica
tions relating to trade and business. 2 his is a depart
ment of statistics comparatively now and difficult of ex
ploration, but no paias will be spared in the search, in
the hope of being able to submit to Congress a result of
no insignificant value to the business community and
to those charged with, the duties of legislation and ad
ministration, which will itself suggest the action ne
cessary to enlarge and protect the important interests
involved. ”
Under the sanction of the nets relating to the-subject,
the Secretary has taken measures for preparing and
printing fractional currency bonds and notes in the
Treasury Department, with a degree of success which
already assures decided economical advantages, and
The Secretary hfcs alreaay inviti d attention to the re
ports of the-Register, the Comptrollers, and the several
Auditors,
Tbe Report on Commerce and Navigation for the fiscal
vear 1562, prepared in the Register s office, has been
greatly delayed by causes explained in his report. The
same Report for the fiscal year 1363 is also nearly ready,
and will be sent to Congress within the.next month. Its
important information will be founts much better classi
fied and arranged, and much more clearly stated 1 , and
therefore much more acceptable for use than heretofore.
The Secretary suggests that it will promote the interests
of commerce and expedite future reports if provision be
made for the raontnly, or at least semi-annual, publica
tion of the returns of imports and exports: ~
The suggestion of the Second Comptroller that the
salaries insthe offices of the Comptrollers should be
higher than those inthe Auditors, and that-promotion
should take place from the latter to the former, is re
spectfully commended to legislative consideration. If
sanctioned by law, it will doubtless promote accuracy
and promptitude in the ravision of accounts. ,
The vast expenditures of the war, 1 in l life and treasure,
have devolved Unexpected labors on -the/Auditora’
Bmeaus, and-especially those or the Secohd and Third
Auditors; and the difficulties, attendant on the organi
zation of a proper force foirihesettlament of theeuddenly
accumulated accounts, have-caused some delays, which
the most strenuous efforts have been made, ia vain, to
av. id, It is hoped, however, that the accumulatiou'
will now be arrested and henceforth steadily reducad.
The Secretary respectfully suggests that .some' provision
he made by which officers of the Department may be en
able d to attend tbe armies and collect -information, and •
especially in regard to the wounded, the missing, and 1
the killed, which will facilitate the promptest settlement
of the claims made in beha.f of- destitute families,- and
widows and orphans
The Report of the Solicitor will exhibit the action of
that officer in the investigation of frauds perpetrated by
certain persons formerly employed in the New York
custom house. 'The -legislation; of last session, the
prompt dismissal of the guilty parlies yet remaining ia
office, and the*measures of prevention devised-and
adopted, will, it is believed, sufficiently protect the Go
•cosnmfnt against the repetition Of these or the commjb
sion of like frauds. .-
The Secretary renews the recommendation, submitted
in his last report, of the purchase of the Merchants’ Ex
change in New York, now occupied under leas 9 as a
custom house.
The operations of the Coast Survey have been -distiu
' guished.by even more than usuaL activity. On the
northern coast the work has been vigorouslyjprosecufced,
notwithstanding the existence of the war; while,ia com
pliance with application* from military and naval com
manders, parties have been detailed for work on the
coast, on the rivers of the interior, and, in
deed, wherever their services conld be made available.
From these labors, of an importance cordially acknow
ledged by the officers to whom they have been rendered,
the value of the survey, and the- merits of those by
whom it is conducted, receive fresh illustration.
During last summer a number of rebels ran into Port-*
land harbor in the night and revenue cutter
lying there, its commanding officer being sick ou shore,
and a portion of the crew absent on leave. They suc
ceeded in leaving the harbor-unobserved: but early in
the morning the Collector of the Port, hearing of the af
fair. tcokinstant measuresforpursuifcby chartering two
patsenger steamers arming them with whatever could
be most promptly obtained, and providing the necessary
force of volunteers, citizens and s oldieis. In a lew hours
the rebels had been compelled to abandon their prize,
after setting her on fire, and being themselves taken pri
soners. The vaiae of this captare can best be estimated
by tbe damage inflicted on commerce by the same rebels
intheTacony. a vessel every way inferior to the one
they bad seized. The Secretary deeply regret? tnafc the
Collector no longer livts to read this acknowledgment of
his prompt, energetic, andjudteious action.
The Report of tbe Board of Supervising Inspectors of
steam vessels, to whose supervision Congress has wisely
committed tbe employment of steam in water transpor
tation, is herewith transmitted. The importance of its
action may be inferred from , the simple statement that
there have been inspected during the past year 9J3
steam vessels, valued at $10,135.057,C00, with au aggre
gate tonnage of 405,000 tons, which have carried, for
shorter or longer distances, 6.420,000 passengers. The
becretary invites attention to the suggestion of a safe
■system of signals, by sounds and lignts, adapted to the
use of steam vessels, whether in the merchant or na
tional service; and which may, perhaps, be extended so
as to embrace sailing vessels'also. Such signals, under
stood by all, might avert many disasters and be th 9
means of many benefits, without at all interfering with
any peculiar system reqaired for special communication
between vessels of the navy.
The Secretary renews the recommendation of his last
report, that authority be given 10 sell the buildings
erected, but not needed or used, for hospitals, and also
such other buildings aj are unoccupied or not-required
for the objects of their intended purposes.
The operations under the charge of the Light-house
Bureau have been sati-sfac.orily prosecuted during the
year. The Gape Charles light-nouse, at the entrance of
Chesapeake bay, was destroyed: by guerillas in August
last. Its reconstruction is of great importance to com
merce, and should be immediately authorized and pro
vided for. ; ; 'J.... ,
The light-house system'of the United • States, unlike
those of-commercial nations generally, is maintained
wholly at onr own cost. - The Secretary suggests the ex
pediency of providing for its support and enlargement
rererfter, so far as treaty stipulations will permit, by a
small duty on tonnage for llght-houte purposes. The
benefits of the system accrue to -foreign as well as to
American commerce, and its burdens should be appor
tioned accordingly*
In this reoort, the Secretary necessarily omits rniny
things; but he cannot omit the expression of his cordial
appreciation of the zeal, intelligence, and fidelity which
the officers of the Department generally have brought to
the ditchaige of their several duties. To their labors he
sensibly feels and gratefully acknowledges that he is in
debted, in great part, for the measure of success which
has attended his administration.
Still less could he excuse himself should he omit to say
haw distinctly he recognizes, on looking back through,
the year, the tokens of that Divine Providence which
has led our country through perils of every kind. How
steadily and grandly, under that benignant care, the
Great Republic has moved on. -How confidently may we
trust its future, to the same sacred guidance.
* 5. P. CHASE,
Secretary of the Treasury.
Treasury Department, Dec. 10, 1863.
KEPORT OF: THE;
SECEETAKY. OF TJHE INaRERIOR.
DEPARTMENT OF THE INTERIOR,
: ’Washington, December 5,1863.
Sib: I have the honor to inform you-that manuscript
conies of the: several reports, and accompanying do
cuments, from the bureau and other subordinate officers
of this Department , for the current which it has
hitherto been customary to communicate to the two
houses of Congress with the annuai message, have been
plTiced in the hauds'of the Superintendent of the Pablic
Printing, in obedience to dhe requirements of the joint
resolution * ‘ to expedite-the - printing of the President’s:
message and accompanying- documents,” approved the
third of March, and-sixty-three.
For information, in detail, as. to the operations of the
public land system, reference is made and attention spe
cially invited to the comprehensive and able report of the
Commissioner of the General Land OfiSce. It will be seen
from it that the* quantity; of land disposed of during the
last fiscal year, for cash,’by the location of bounty land .
warrants, as swamp and overflowed land, for railroad
purposes, and-under, the homestead law, wa52.966.695. 43
acres, as against 1,377;922 acres disposed of during the
previous fiscal year, and during the-first quarter of the
present fiscal year 874.850.66: acres, making the entire
quantity thus disposed of during the period named
3,841,£49.C9 ; acre5. 7 he increase arises chiefly from the
operation of the homestead law, under which alone
1,456,614.96 scres.were taken up since the Ist of January,.
18 3. when it took effect. ’ ,
The revenue derived from the sale of the public lando
during the last fiscal yearamounted to $136,077.95, being an
increasuof $11,029.65 over the previous fiscal year. During
the quarter ending 80th September laet the sales amounted
to $90,090.65 which ie- $77,60.59 more than was realized
during the quarter ending September 30,1861 The rapid
increase now observable ia the sales of the public lands
affords additional evidence of the entire confidence ofrthe
people in the stability of the Government, and thabthe
in dustrial resou ces of the nation have not been material
ly diminished, .'notwithstanding the immense armies it
has placed in the field. -
No subject committed to the management of this De
•panment is of greater importance tianthatof the public
lands, nor has any been more prolific of legislation.
Congress, at an early period, recognized the expediency
and importance of the speedy settlement of tlm pnbho
domains and of a liberal policy towards the actual set
tler. The prudence and wisdom of the syatem thus
early inaugurated, and which has finally culminated
in the enactment of the homestead law, are attested.by
the vast extent of fertile country which, has been re
claimed and formed into now populous and flonrishine
States, which contribute of the superabundance of tbeiy
agricultural and mineral productions to the necessities
of tbeeatlier settled portions of the country and to £e
reisana-ions. " . „ ; , „
Tr.e progress being made in the of
a railway to unite still morec l osely the States ontho-At
-1 attic to those t .ou the Pacific will sowi attract settle
ments aloQglts entire route, and'tbe Commissioaer of
the General Land Office, with wise forecast, has. with
tbo approbation of the Department, sljghtly increased
ilie usual i uxveying estimates, in order to meet ihe exi
gencies which will thus be created. . .
Jn order to obtain the benefits of the act of May 20,..
1562, 4 to secure homesteads to actual settlors ontho
public domain. ” cerlain preliminary acta aro required
to be performed before the register or receiver for the
district of lands in which the sottlement
be made b 7 the party applyina-tA 33ersc». Thla re
quirement of the Jaw is thongUi to operato invidiously
towards persons who are engaged in the* military and
naval service of the Uniied States, and, >to remedy the
evil, it is respectfully suggested that jhe law- might,
with propriety, be so far modified as to permit the wife
or other proper of a person so employed
in the public service to take the preliminary
-steps for the legal inception of.hls claim : I also concur
in the opinion expressefiibythe Commleeioner of Public-
Lands, tbat ifc is expedient, and proper ta requireper-
Bons claiming the benefits of tlye lakt to nay the full
commissions of the sagUter and receiver at the time tho
entry is made, instead of deferring the payment of - ’ one
half thereof until iihe final issue oftlie certificate, at tho
end of five years.
AMhellme of the discovery of the great mineral wealth
of portions of public domain-the nation was In the
enjt yrif nt of domestic tranquility and unrivalled pros
perity, and-could well afford to throw open her rich
.mines of tie precious metals to the unrosUioted enter
prise of tto world;.hut having now been forced into a
war for ihd preservation of our national existence, as an.
in expense as in magnitude, the question
Whether we can, in justice to other branches ofmdugvry
uad exempt U 49 of
individual revenue from Ub equitable share of the pub
lic burden, becomes of much importance. A small tax
upon tbe net profile of the gold mines of the United
btates would largely increase the means of the treasury;
sndftftiio mod reason stems to exist why the n»tion
should not, in its hour of need, derive some direct assis*
lance from its extensive fi el d b of gold and silver mines,
I .earnestly press the consideration of the subject with a
view to that end.
Jl’he attention of Congress la also called to thenecessity
of providing br law for the appointment of a surveyor
general, and the establishment of a district land office,
m the Territory of Idaho.
In view of the disturbing canoes that have existed, our
relatione With the various radian tribes are as favorable
as could reasonably be expected. The experience of the
past few years, however, clearly iemonelratos the ne
cessity of important cba'ngos in tlie’policy hitherto pur-
towards them '
while the regions of country occupied by the laxtians
rc-majned uninhabited by We whites, tba plan of setting
apart separate reservations for different bandß of the 1
fie.me tube, or foreman tribes possessing similar habits
ana customs,, and prlvileßed roam over common hunt
ing grounds in*queat of the means of subsistence, as in
Michigan, Wisconsin; Minnesota, Kansas,and Nebraska,
Bennea wise and to promise suecets; but aB tbe country
becomes settled, their dependonco upon game and the
spontaneous production* of the easih becomes more and
more, precarious, whtiS'tbe necessity for their keeping
within'tbd" limits of thoir reservations increases: The
Indians are'tbns left without i heir Rconstomedvesocrces,
and in the msdst of a population with whose customs-and
arts of life they.’ are wholly unfamiliar. They conse
quently become'discouraged, and, looking splelytO their
fccaniy ammitits horn the. Government, or to bagging
and pilfering forthe necessaries of life; fail an easy prey
to the sharpers and whisky traders who gather around'
their reeervations-for the purpose ' of’obtaining their
moufrys. The smaller tho reservation, the greater are the
facilities for the oxercke of this pernicious influence,
and hence tbe neceesityof concentrating scattered bands
and tbeswaller tribes of similar habits, Jangnag*,aud cus
toms, into as large communities as possible, and their loca
tion upon themore remote portions of the public domain.-
They will soon become extinct unless they acquire the
aits<-of civilized life, and to this end it is indispensably
necessary to place them beyond the reach of any influ
ence cave that of their agents, teachers, and assistants.
The vatt emigration to the uewlv discovered gold-bear
ing regions of the interior has brought us into more im
mediate contact with large and powerful tribes, with
whom no treaties other than of amity have yet been
negotiated, and all the energies .whiofr the Department
can possibly exert in that direction will scarcely be ade
quate to the pressing demands thlrt will be made upon it
during tbe next few ytars by the exigencies of the In
dian service in those regions. Immediate step's 6hould
be taken to prevent collision between them and our own
people, to provide suitable locations-for the Indians,
and to induce them to settle upon, them acd engage in
the cultivation of the soil, and the rearing of domestic
animals, and In the meantime to fnfnish them such sup
plies as may be absolutely necessary to prevent starva
tion. Tbe number of Indians under the direct supervi
sion of the Department is thus rapidly becoming larger
than at any former period, and the wisdom of antici
pating this increased demand upon its resources by a
corresponding increase in the appropriations for the In
dian service, whether we are to be guided by the prin
ciples of justice and humanitj', or economy, must be
manifest io all.
Particular attention is also invited to the condition of
Indian affairs in California. That State'has'hitherto
been divided into two districts—the Northern and the
Southern—each under the charge of a saperintending
agen;, There is no good reason lor continuing thig ar
rangement, and on the score of economy alone it ought
to be abolished and our Indian relations throughout the
Stale placed under the control of one superintendent.
The good of the service and the fature welfare of the
Indians also imperatively demand the establishment of
two reservations in- the, northern part of the Stated-one
near the coast, and the other in the interior—of sufficient
extent for the accommodation of all the Indians in what
is now designated as tbe Northern district, aod at least
one suitable reservation for those in the southern portion
of the State. The necessity for these different reservations
arises from the great dissimilarity that exists in the
habiisand'customs of the several, tribes for whom they
are intended.
The hostility of the powerfal tribes of the Apaches and ;
Navajoes, mainly located in New Mexico and Arizona,
is such, that for the present their management must fee
left chiefly to the military branch of tbe Government;
but measures should be promptly taken for the establish
ment of writable reservations for the other Indians in
those Territories, and for those now in hostility to the
United States,- whenever th*y shall have been properly
eubdned.
The unforturate result c.f the effort made last spring to
return the re ugee Cberokees to their homes has largely
added to the number of refugees, and greatly increased
the expense of then’ subsistence. This, together with the
advance in ihe prices of clothing and provisions, has so
augmented the expeu&eof providing forthem’as to ex
bausi the funds set apart for that purpose, -and renders a
further appropriation necessary. It is doubtful whether
the supplies needed could, even now.be forwarded in time
toprevent much suffering, and hence the importance of
as early acfic-n by Congress in the premises- as maybe
practicable. -
The able reportof the Commissioner of Indian Affairs
willbe found to be replete with interesting facts, and
judicious suggestions on the subjects to which it relates.
The number of Revolutionary soldiers borne upon the
penfion roils had dwindled down to eighteen on the 30th
of June last, of whom only ten had made application
for their stipends on the 4th of March., Thenumberof
widows of Eevolutionaij’ soldiers on the rolls, at tbe
same period, was 1,573. The whole number of army in
valid pensioners on ; the rolls the 30th. of .Tune was
7,245, most of whom were pensioned on : account-of
wounds received or disease contracted in the service
during the present war. The widows, orphans, and de
pendent mothers of 3‘673 deceased soldiers of the present
war were inscribed upon the rolls during the last fiscal
year, making the whoie number of this class on the
rolls at the close of the year. 4 Bio. The number of navy
invalids on - the rolls at the close of the year was 541, and
the number of widows, orphans, and dependent mothers
of deceased officers and seamen of the navy, The
whole numerof army pensioners added to the rolls da 1
lug the last fiscal year was 7.581, and of the navy,*3iB.
Ihe number of armypeurioners,. of all classes, on the
rolls on the 30th June las*, was 13,659; and of the navy,
1,132, The payment of the former requires the sum. of
$1 227,041 SS, and the latter, $144, t7l 61 per annum.
The remittances to the agents for paying pausio as have
been so regulated aceordisg to law *•* as to prevent an
undue accumulation of balances in their hands. ”
Duringthe year 602 bounty land warrants have been
issued, calling, iirthe aggregate, for 94;250 acres of laud.
It appears from the Commissioner’s report that the
whole amount of motey expended by the Government
for pensions to the close of the la sfc fiscal year was $91.’893.-
660. fc7, and that the quantity of land granted for military
and naval services was 65,896,142 acre?, which, at $1.25
per acre, would amount to $82,370,177.50. ’
Congress at ihe last session provided for an increase of
the clerical force of the Pension Office, and I am happy
in being able to say that it lias enabled the Commis
sioner to dispose of-the greatly.increased amount of
business thrown upon it with satisfactory promptitude.
During the first quarter of the present fiscal year 7.162
claims were admitted,- and a- much larger number
examined and suspended for farther.evidence. .
The Comiuiisioner estimates the whole number of
claims that will be admitted' during the present fiscal
year at about 30,009. •
The anuointmsnt of surgeons: as authorized by- Ihe act
of July 14, ISO 2, to make the biennial examinations of
pensioners, and to examine applicants for invalid pen
sions, has been attended with marked advahtage-and
saving to the Government. For the information of the
public and those more immediately interested, the Com
missioner has embraced in his report th e names of the
Burgeons thus appointed in the several States, with their
pcsi office address.
The act of 3d March, 1859, requiring the biennial exa
mination of invalid pensioners, prescribes that the exa- -
minacious shall be made by two surgeons or physicians.
The Commissioner is of the opinion, in which I.concar,
that the examinations will be as satisfactorily made by
a single surgeon, appointed by the office, and
with less inconvenience to the parties interested, and a
modification of the law in this respect is therefore recom
mended.
The increase of the navy pension fund from the sale of
prizes ambunte, at the present time, to probably'one and ;
a half million of dollars. . ; \
The old laws in relation to the navy pension fund seem ! ]
to authorize and require the Investment of this money; \ 1
but as the question is not entirely free from doubt, I re- ! <
commend the passage of a law authorizing the Depart- , 5
ment to invest the amount, which has been and may j 1
hereafter be derived from the sale of prizes, in Govern- ■ 1
ment bonds,'and p.puly the interest thereon to the pay- ' 1
ment of navy pensions, or that' the Secretary of the [ •=
Treasury be authorized by law to’credit this fund with < 1
the interest which would semi-annually accrue thereon, t 1
if so invested. . 1
A decision has been given by the Department in a cas9.i
arising under the act of July 14, 1552, and as it will fur- < 1
nish a rule of action for the Pension bureau, in con- I 1
riant y recurring cases of a like character, I beg leave to 1 ]
refer to it specially s <
The second, third, and fourth sections of that act make s
provision for the widow, children, dependent mother, i ]
or orphan siiters, as the case may be, of any officer or j <
othtr person named in the first section, who has died ; 1
since the fourih day of March, 1861, or who shall there- j :
after die. by reason of any wound received or disease •
contracted while in the service of the United States and ; j
in the line of duty.-: An officer of the navy had con- t
tracked, under these-circumstances, a disease of which i
he died. Some months previous to his death, he ten- 1
dered his resignation,'as his declining health, impaired '
by the disease which ultimately proved fatal, incapaci
tated him for the efficient discharge of duty. His resig
nation was accepted. 9he claim of his widow for a pen
sion was rejected in the Pension Office, solely upon the
ground that be was not, at the time of his death, in the
naval service of the United States. The case was, by
appeal, brought before the Department. * '
The action of the Pension bureau conformed to the con
struction which had.been given to preceding acts of Con- J
gress, granting naval' pensions. Some<of these acts ex
pressly coniinedth'e right of the claimant to cases whera
the death of the officer occurred during the period of his- i
service. O.heracts such as that of 1813, and the second
section of the act ol 1814, secure to the beneficiaries, for a -
specific period, half of tbemonthly pay.to wh.ich.the de
ceased was entitled at the time of hisidealh'. The late-
Attorney General Butler decided that the death of an
officer or seaman, before the expiration of his service,
was not essential, under the latter acts, to the validity
of hie widow’s claim-to a pension. He subsequently
withdrew that opinion, and, although considering such
a claim within the general equity- of the system he
came to a conclusion, adverse to it under-those acts,
owing to their peculiar phraseology, and from the fact
-that Congress had given a construction to them by the
continuing acta of May 23. IS2B,.and June 28,-2332.
The act 0f1562 does not, in direct terms, exclude from
Its benefits the widow or other designated relatives of
pertons who, after their resignationor discharge, shall,
die of wounds received or disease contracted in the naval
service, and inthe line of duty, nor does.it determine
the amount of pension r by the monthly pay-of the de
ceased at the time of his death. The latter provision
would £e?m to require that the connection, of the de
ceased with the service shonld subsist until his death..
By the uniform practice of the. Pension bureau, under
the existing act, a military pension .was granted! to the
relatives of the party, without regard to the time of his
death, if the claim in other respects was free from ob
jection. Uniformity in the administration of. the act is
desirable, and a settled interpretation of.it should be
adhered to, unless it- be manifestly wrong. Although,
in the former legislation of Congress, military and na
valpensions wore granted under.separata and independ
ent enactments, both classes of pensions arc.-pnmded
for and placed upon the sam9 footing „by the act under.,
coisideiation. No distinction is made between the two
branches of the service. I could not sanction.a decision,
making such a distinction, and I was satisfied that the
action of the Pension bureau, in regard.to military pen
sions, was amply justified by the spirit, and*was not in
violation of the letter, of the statute. -
The effects and consequences of the opposite construc
tion are worthy of attention.. Accordant to ia, no provi
sion is made for the bereaved and often necessitous and
helpless family of a deceased who has received a
mortal wound or contracted a fatal diseass-in the line of
' duty, if hisdeeth-occurred after of the
period of his rervice. Had the .wound or disease inflict
ed a disability, it is clear that, .had rue survived it. he
would have been entitled to a pension proportionate .to
each disability. The pension vrou^d-not commence in
any event until after his discharge. Should the disabled
. and discharged soldier or seaman die after receiving his -
pension, or before estabUshingbisxlaimto it, uis rela
tives won 1 d.be excludsd from the oounty ot Congress,;
although it couid be ihown by. indisputable proofs that
his death was Ihe direct andlnsyitableiesult of a wound
received on the field or the deck, from,she enemies of lus
C °ltseemedtometobe'moreinAc.corSfincewßli the le
gislative intention to. hold that, the death of a
after his resignation or discharge, would not be fatal to
the claim of niß widow,or relative* t*>a pension.
Shonld I have erred in thisVsqewu Congress can app_y
the appropriate corrective in regard) &o future ca«es. .
I would advise, however, thatr3ome limit should ja .
fixed bT-law, within which the dea'.h should occur--to
entitle the beneficiariesnamedia,tha second and the fol
lowing sections of the act to the benefit of its provision s
During the year ending 30£h September last s,l3£*o
plicaffions and 811 cayeats.w.ero received at the Patent
Office 29 applications were filed for tbe extension of
patents previously, granted, ; During the earns period ,
3.8T7 patents were issmd and 40 extensions granted.
Quite a diminution is observable in the number of riaims,
oiv which patents.have been allowed, but not issued
became of the non-paymanV of the final fee within the
time prescribed by law, the number being abouh37o.
The balance in Eho tteaaarv to the credit of the patent
fund on the Ist of October, 1563, was 645.157.2 U The re
ceipts of the office to September 30,1563, to .
$179,378,55, making its entire resources for the. year
$227,535.76 Tbe expenditures of the office during that;
period have been $189,303.13. leaving a bailee, on hani
on the Ist October. 1853,, of $37,732 63
The work of classifying the results or. the eighth
census for publication has progressed satisfactorily, and
the printing of Vnq volume of population statistics. ia,so .
far advanced as to insure its completion and delivery
early inthe coming session of Congress. The succeed,-
ins volumes will be supplied to the two Houses as fast
ns the capabilities of the public printer; will adm&.
The marshals and assistant marshals in ,th» loyal
Siates have generally beenpaid in foliior theirseryices,
and the account* of those employed, to take Ste terri
torial census of-Nevada, Dakota, and Colwado, for-v
which provision was made by tbe sstof Mas an 3. 1063;
have been paid-in part, and the arerin pro
cess of adjustment. The final setUement of the accounts
of 1,507 marshals and assistants In States afiected.by the
rebellion has been precluded condition of public
afi'airs and the refusal of those officers ta take
the oqth proscribed by law asi a condition precedent to
reports from th* Board of Visitors and the
Superintendent of Constiuoison of tha Government llos
• pltal for ihe Insane will by all with, muoh inter
est Tbe advantages of iiis institution at the present
time cannot be overestimated. Those who. while en
gaged in the land aud. xaval service of the country, in
this trying honr, for ihn preservation of our Government,
are overtaken by mental disorders,, there find a
refuge, and are treated wilh the highest skill
which has yet beffli attaiiwd in the- treating
Ihe Insane. The success wilehhas attended their treat
ment, and the numbers who are the
most flattering teßtimonlals in behalf of those who have
had charge of inslltutlon. Theiv devotion to their
calling is cnly ifi be fully appreciated when it is remem
bered that a larger number of patients have been admit-,
ted to this Institution duringthe last, year than have
ever befow. been admitted into any similar hospital in
this in the same space of time.. Although eo
large a number have been admitted, ana the increase
been Chiefly derived from the army and navy, it in grati-.
fling to bo assured that neither the existence of the war,
doubt a* to the justice of tho cause, nor distrust as to its
I '‘final result, Is to be imputed as the cause of the malady
E' wU’i trM* the patients liht« been sfflletea v l)Ut ijwtft
THREE CENTS
ig rather the result of overtasked efforts of coustitutiorcs
previously impaired by sickness contracted in the liny
of o’etf y.
other advantages ■which this instittiUon
afford Vrieth&ttbote who have suffered a loss of a limb
in the k'ervlce may here have it replaced by an artificial
one; fab Treated by persons of the highest skill, without
cofct, the beiog maintained at the hospital, free
of expent during the time the artificial limb is being
prepaied, l.’iade familiar With its mech.aniam-and.ttBe,
and thus aiU&Jed to adopt their new help with the
greatest advi.'atage and ease to themselves. , '
During the year mcch difficulty and perplexity
have been tx’Perienced by the Department in the
admhaion of l'ntients to this institution under the
pi stent laws. Jffany applications have been made
for admission cf peisona who have sought refage
in this district tot'have not their permanent homes
here, so as to be clearly entitled to admission Into
the hotpital, as tagldent paupers' at the time' of
becoming Insane. Taese persons have, in many in*
stances, been a fierlons charge upon the War Depart
ment, which has been vflmpeiied to take care of them in
camps and other unsuitable places forzuch persons, and
coi-sequeatlv at groat expense and Inoonveniencs:
It is recommended tha'i*exhting lawn on the subject be
fo modified as to pern.’.it the Department, in the.ezercise
of a proper discretion, to s,datlt this class of persona into
the asylum Until they c.an Mmore properly of.
I cannot conclude ray .notice of this institution without
adding my testimony io thaS of all my predecessors-'.to
the marked'devotion and ability and fit
nets of the. gentleman vbo h£3-’oueupied potition cf
fcureriutt-ndenfc from tk«-foundation of the naylazn.
Ko dererveo the gratitude ofShecountryforhis ze alone?
and perhigten ( t efforts to snake Institution under his
charge a model one in every retpesfc in which it may be
viewed.
The appropii&tijUfl whivb are ?„b1 e-d for the’ensuing
fipcal yearare earnestly recommended. Ko application
of public money ba« ever keen moro wisely, ecocotal
cally, and tatisfhotorily mads, thau-have' the de
dicated by Cong«s»?o this humane and benevolent iu
fctiruiion,
The Colombia-Initttution for the•in&fcructioa c?tbe
deafand dumb and- tira-blind has beoir managed IwUh
great ability and success. The buildings, however, are
manifestlyimufifbientftirilie proper accosnmodatioE’of
the r upils admitted and the growing wants of this conh
mnniiy.
The report: of the presi dent of the institution will b&
read with interest; It expresses an earnes&desdra forthe’
acquisition of more adjacent land—to the cxteaiof about
thirteen the instruction of the pupils in horti
tulture and agriculture? the erection of more-permanent
and commodious'mechanic shops and other neaebsary
boildirgs, and for the introduction of thfr Potomac
■water, and asks for these purposes additional appro
priation s amount!* gto-abcu: $6O, COO If it be the inten
tion of Congress to make this institution a receptacle or
all who will probably apply for admission iatoit, the
proposed enlargements c/ie-eminently.proper, I ’and?should
be made without delay, in order to secure the requisite
lands before they shall have advanced in price or bo
otherwise appropriated. Butif it be only designed tomake
provision for the unfortunates of this class inhabiting
th e District of Columbia, and the children of persons in
the military and naval service, who are unable to-pro
vide for them elsewhere*, then it is doubtful whether it
will be proper to increase the extent of the groundK or
to construct the buildings, as proposed. In either case,
bewever, the wooden structures now appurtenant to
the buildings occupied are entirely unsafe for the'pur
poses to which they are applied, and should be removed,
and their places BUpnlied r by tubstantial brick building,
tnd about two acres of land added, for the purpose of
creeling thereon proper workshops.
I abstained from submitting the estimates proposed for
the larger sums, because I was-not prepared to eay what
the wtil of Congress might be on the subject; but I'
earnestly recommend that provision be made, if notfto the
full extent asked, at least to that required for
aud safe accommodation 1 of the children of the district
who are entitled to admission into the institution. It
ihould also be-supplied with water, and T r-commsnd
the apprcp.iation of the amount asked for that purpose.
: Satisfactory progress-has been made on the work of the
Capitol extension and new dome, notwithstanding the
difHctfUie* encountered in obtaining fhd marble for the
former, and artisans of the-requisite skill and expe
rience for the peculiar character of the work to be done
on thelafcter- • r . ' "
Slice tbe last annual report from this Department,
the eastern l portico of-the-north wing has been. con
structed, and much woTk’done on that of the south wing.
The porticoes of the connecting corridors, and the aranite
plaiiomsand steps between the old or central portions
of the betiding and the nevrwings, as well as the ap
proaches tobothwings on the western front, have also
been completed. It is expected that the eastern, entrance
to the north wing will alsobefinished the present season.
The groop of statuary which was executed here in
marble, from models madeby thelateThomasCrawford,
forfbe pediment of the eastern portico ofthe north wing,
designed to represent “the progress of civilization,”
»nd ; rbeataiues of ‘‘ Justice” and '“History,” which
were also designed by Crawford, and executed in Italy,
have been put in their respective places, and attract
much attention and merited admiration.
The expensive and elaborately-wrought bronze door,
designed by Randolph Rodgers, and cast at the Bavarian
foundry, in Munich, and the marble statues of Franklin
and Jefferson, executed in Italy, by Hiram Powers,
under a. contract made by your immediate predecessor,
under theaufhorily of an act of Congress, have also been
received and placed in appropriate positions in the
tui’ding.
All there works of ait, and a few others not yet com
. plated, weTe er-empted fromHhe restrictions which were
imposed upbf. -the embellishment of the Capitol with
statuary and*paintings by the recent legislation of Con
gress,
The colorsal figure of *. Freedom,"designed by Craw
ford and executed by C‘ar* Mills, was, on the 2d inst,
successfully raised to its elevated place on thejiew dome,
and forms a grand and appropriate crowning to the Ca
pitol of the cation.
With a view to economy,* during the present year I
abolished the office of architect of the Patent 'Office,
betiding, nod added thedntiei of the same to those of tae “
architect of the Capitol extension. Preparations have
been made for finisbingrbe 6alooa of the north- front,
and for faraislun g the same with suitable cases for the
reception and exhibition of-models.
The work will be completed during the approaching
season, and with the appropriation made at the lae-t ses
sion of Congress for that purpose. The architect atrong
lyurgesthe propriety and necessity of completing the
exterior ofthe north front, and an appropriation for
that purpose-has been submitted in the annual estimates.
It became indispensably necessary,;for the proper ac
commodation of the Sunreme Court of the District of
Colombia, and the offiders• connected therewith, to
make certain changes and improvements in the eistsm
portion ofthe City Hall, which I have caused to be
made, at the expense of the judiciary fund, upon which
it has beeu ufcual to draw for such purposes, and the
court is now enabled to dispatch the business coming
before it with much greater convenience and satisfac
tion to the public. *
The report of the Commissioner of Public Buildings
will indicate to Congress the alterations and repairs
which have bten made to the finished portions of the
‘ Capitol, and v» hat additional improvements he'd eeme it
advisable to have provided for by farther legislation.
It also explains the mannerin which the moneys appro
priated for the public works under his charge have been
expended during the past year, and recommends other
Improvements of the streets and public grounds, which
recommendations will, no doubt, receive the considera
tion of the appropriate committees of Congress.
The duties properlylacpeitaining to the office of Com- •
mifcsioner of the Public Buildings and Grounds have
been greatly augmented within the past few years, and.
sometimes by me imposition upon him of duties not
strictly belonging to his office. In justice to him, there
fore, as well as to the public service, at tha com nance- ;
meat of the present fiscal' year I. relieved him, to some •;
extent, by the appointment of a general superintendent
and special disbursing agent for the Capitol extension,
the Patent Office building, and the Washington aque
duct. In making this arrangement, a saving to the Go
vernment was effected, while I, at the same time, se
cured for these important works the services of a pro
fessional and practical architect.
* The work on the Washington aqueduct has progressed,
in pursuance of the act of Congress transferring the same
to this Department, with but slight exceptions, and the
water of the Potomac river been this day introduced
into the reservoirs. The walls and banka of the dis
tributing reservoir were designed, by the engineer who
projected the aqueduct, to be protected with broken
ttone, and a contract was made and the work commenced
on tb at pi an; but it appeared to me to be so nnsnbstantial
and insufficient for the purpose that I caused an inquiry
to be made as to the manner of protecting similar em
bankments in other localities, ana found that, with but
few if any exceptions, the walls were lined wi r h solid
stone masonry,laid in the best of cement. Influenced
by the example and experience of others, and by the ad
vice of eminent engineers, I directed a thin dressing of
broken stone to be placed upon the interior walls for a
foundation, and thevwhole to he faced with solid stone
woik of about the same thickness as the contemplated
riprap or broken-stone wail. According to the original
plan ofthe aqueduct, the water from the Potomac is con
ducted into a receiving reservoir formed by.a daimactoss
a stream called Powder Mill or Little Fails branch, about
nine miles below the head of the conduit, whence it is
convey* d about two miles farther downto a distributing
reservoir, divided into two equal sections, or basins, by.
an embankment designed chiefly for. filtering purposes.
It is thus always intermingled with the water ftom
Powder Mill branch.-.' The latter stream drains a
considerable extent of country,, and is subject to
frequent and heavy^freshets which render its water
unfit for immediate use. At limes this stream is
clear, while the water of the Potomac is rendered
impure, by reason of heavy rains nearer ita source.
It is, therefore, important that should
he so constructed , as to afford an adequate- supply
of water from whichever of these sources may, for the
time, be most free from impurities, and to exclude that
which may be unfit for use. For this purpose, the engi
neer in. charge proposes to connect the condnit abovethe
receiving reservoir with that below it, so that the water
from the Potomac may he brought directly into, the dis
tributing reservoir without being adnlterated’hy that of
Powder Mill branch. He also proposes to construct a
gate-house in the dividing wall ofthe distributing reser
voir, so as to admitof the use of the water from either
. section, as may become desirable. By means of these
improvements, the requisite supply of water may be
drawn from whichever of four distinct sources msybe
the purest and best, viz-:, the Potomac river. Powder
Mill branch, or either section of the distributing reser
voir; but, without some such, arrangement.. “anun
failing and abundant. supply ofjgood and wholesome
water” cannot at all. tlmeß be-ohtained. under these
circumstances, I have deemed it necessary to orderthese
changes in the original plan, and have made the esti
mates of appropriations for the.completion of the work
to conform thereto.. For information in,detail in refer
ence to this subject, I invite attention to the full and able
report of the chief engineer.. .. ...
Certain parties having, from-time to time, made claim
to heavy damagesfor the diversion of the water from the
Potomac river, my immediate- predecessor, with a view
to settle and end thisclainventered. into an agreement
of arbitration with the claimants. Pursuant to thin
1 agreement,-the arbitrators, met from tinae to time, and
finally submitted their award,, by which they adjudged
in favor of the claimants upon each'and- all of the plans
and modes submitted to them,, being three in number,
for the construction of tbe dam .across- the Potomac, and
also $12.C00 for their ownfees as arbitrators, ands7ol.S4
for tbe expenses of arbitration. The sums being solarge,
I did not feel justified in, applying .the existing appro
priation for the completion of the aqueduct to the pay
ment thereof, preferring to submit the whole matter to
Congress for ilB : determination. , Ifc appears from the re
port of the experienced engineer, inensrge ofthe work,-
as must be obvious to every observer, that an ampLe
supply of water for the use of tte oit.es of Washington
and Georgetown, for manr.veaca to come, can be ob
tained from-the Potomac by.the.erection ofatightdam,
extending from the Maryland, shore to Conn’s island, to*
a height which will give a.head.of six feet of water in.-
the aqueduct, and yteld.-a, dally supply of about-,
6G»CCO.OOO gallons, which, ris ..thirty-three and one-third
per cent, more than was used, w the city-, of Eew York
in the year IS6I, when its .population was over SOO.OOO-
In view .of this fact, I-havs.ih&iructed the engineer to
construct a dam of crit.stone,. with a base sufficient ho
bear a superstructure of -tha.r&qaired height for the fall
. icapacity of the aqueduct,- whenever it may be caned
inio requisition:.. / , •, ... ...
It in difficult to coiiceiv©-isaw a dam of this character
can work any injury to of the watertight
cUimed at the Great Falls. M the utmost.it could caly
raise the water to alevel.&iittteheadof the island, while
at ordinary stages and at lew water (the only timawhen
any value, can properly ba-placed upon the rigptsv it
would not increase or the flow ofwater.m the
main channel on the wsst'Side of the island; and it sure
ly cannot be pretended,that*the parties claiming the wa
ter right can lawfully dlijerS the ordinary flora of the
water on the east side cirthe island. A dam of the east
cb annel that would.raise-the water to a height sufficient
to fill the aqueduct would be a great advantage to tlie
claimants.for the reason that it would enable them to
avail th e luselves of ike-power by the but one
dam. while one that wouH only back the water to the
head of the island must be a matter of total indifference
to them; because, in the very ns lure of thing®, it can
work Iheinuodetrlment. whatever. ' _ T
If this view shall be taken of the case hyCongress, I
re commend that sum be fippropriaiea to pay
the expenses of the arbitration, and that ths eetimate of
the costof tho-.dam: aososs the main ci\>pnei be aimln
ished to the estimated, eosfc cf the dam ojrm the east chan
nel, thus leaving the greater expense of« the dam to be,
provided for a's.the exigencies of the auies. of Washing:-
ton and Georgetown, by tne increase oitheir popula,tloi^„
ths, engineer will ugil fail to arrest the*
attentiosu of-Congress in another important particular.-.
The immense volume of water which the aqueduct
will soon furnish will afford an ample supply for fcun--
tains at all appropriate places, and. for cleansing the.
streets and 'sevms of the city, keeping them at all times
in a healthful and agreeable condition. But lu order to.
the accomplishment of this mo.sk desirable obje4> .the
present system of expenditure repairing
and the comiiruction of sewera-mnst be abandoned, op
modiffed-to snob an extent a& i;©. place it under aaa>con
,tr®l. I can perceive no good#reason why the»(?Qvern
ment should take upon itself .the exclusive managemont
amd repair of one or more sf who streets and ayenues of
the cjty, while a.ll are eomlly necessary t-o.rtio ooa
venience and comfort of hie citizens of the united States
visiting ov residing in the city of Washington. The
great width of its numerous, streets and av.enuea quite
discourages any attemj&to completely ra,ve.them; nor
is it desirable that it sX-inld be generally done, when we.
consider the incieaesd amount of heat that would be
radiated from their exposed surfaces, and the clouds of
dust that would be constantly Bweepiiuf.over them.
it is believed thcAthis may be avoided:to a great extent,
by allowing in some instances tbe adjoining proprietors
to extend the sidewalks into the streets, so as to reduce,
the latter to a proper width for pavement'or concrete,
and to afford, space for grass plots la, front of their dwell-'
in rs, and in . other streets by making a park of proper
width through the middle for the cultivation oJ trees
and plants, sa& the erection of fountains. By the. adop
tion of such a course, the streets and avenues of the city
would bet reduced to sucli width as to admit of their
being tl\o.#onghly paved at a reasonable cost, and the
beauty and comfort of the city immemely increased,
Butncdlher this nor any other, great improvement can
he exacted tinder the present laws. They ebould be so
modia-ed as to require a uniform and perfect system or
sewerage throughout the city; and to superintend this,
and improve and repair the streets,commissioners should
be provided, one to be appointed by the Goyerumeut,
and one or more by the corporate authorities of the cuy
the money appropriated by Congress to be expencea in.
such proportion to the sum provided by the city as shonld
be prescribed by law, and the obligation
the city to raise by taxation,’ annually, ® n ®*L sum as
might be deemed by the commissioners necessary for the
objects to he accomplished. , , t , _
An aot of Congress to extend Sthe
andrla and Washington Railroad JJj} /&J
other purposes, approved .March- 8,1863. authorized the
company to ereot-nn additional structure or passage.
way alopy eithw M 5U9 Ffftww* brl&n t?c W4’
TUE .AE FEEHEI
(PUBLISHED WEEKLY.)
m War Fmu Will be sent to subscriber* by
mall (per usua it advance) iim , 00
Three a nn
Ilweopte. ~ __ 8 oa
Ten —~ls OO
Larger Club* than Ten will be charted: at th* B %xne
ate, IL BO per copy.
&icmoney must alwayt accompany (he enter% meet
in no instance can these terms he deviated/rom, as they
afford verv little more than the cost of the paper..
are requested to act as Agents fry
mWAnPnsßfl.
To the aetter-ny of the Club ci ten or twenty, atf
extra copy of the Paper will be given.
fcut ?° aB not bincSer the general
nee of said bridge for ordinary travel. The a array*,
for the construction of this bridge.
with a model of the proposed draw, were euh
(flitted to and approved by me aB required by the act re«
1 erred to; and the company immediately thereafter eu*
k r hf gn Ib located on a centre)
line fc6venty-flve feet below the cfrntre line of the old
oridge, and has progressed with such remarkable ca-
f s . to Justify tie belief that it will be fallr com
pieced daring the early part of the approaching session
of -P,°£*^ B8 * it is expected that the railroad travel
J” 1:l .Vto it, and the restored to th«
u ®*;, o ® public, for whom it was'intended.
a dilapidated condition, and there ig
tB\\* s iumiediate repair.
The iveport of the Police Commissioners will be found
to be an elaborate and interesting account of tnelr opera*
tioua dnring thfi past year, and folly attests the useful
ness and importance of their organization. It, however,
contains m any recommendations which if fully adout
ed, wi‘! impose greatly increased expenditures upon the
Government. Prom the examination which I have bean
sole to give to the subject, I anrinclined to think an in
crease of the force. and of their compensation, is expedi
ent and proper, but aot to the extent indicated by the ~
commissioners.
1 have no* been able to convince myselfof the justice
of imposing she entire support of this police system upon,
the Federal Government, it was shown by the census of
1860 that the District of Colombia then contained seventy
five thousand psimanent inhabitants, since which time
its population has evidently been largely lucreised.
? *«*? v no city within the United States, it iB believed,
in w cic’h propenty of all kind.Tyielda a larger income, in*
iw vslne, and no" good reason exists why
it phodd not nelp ts defray the expense of its own pro-
S S 1 ,.! I ’.!, 1 ? 3 . 1 *? itt making this sasges
txou, by the raci tha. She annuil tax imposed upon pro
per, y in this District is much less than that imposed oa‘
ue prrreity in sny of the principal cities in the United
ota tee.
/xhe suggesSSoßß of the Commissioners of the PoDco for
trc**ffiore economical and epeedy punishment of crime
are just and proper, and deserve the carefal coaaideru
i:ou of Congress
Ahor.ee of correction andfor tie detention of juvenile
ofieucers sbopla he provided, andaeystem adopted bv
which ‘ragranis 'and petty oilenders, on conviction upon
injamaiy trial before the rol.hh magistrates, shouid re
ceive punishment, by being* compelled to work
upon the street*, to break stoce in the quarries for their
naproveraent, or to labor in eome other useful way
-The wfcjtf of a penitentiary has been particularly fait
id theadminifctrstfon of justice in-thie District during
the past y€ 37. The vrioie number of. convicts now un
der senteico from this- District is 179 ; of this number
343. have bee^conviewed and sent to the penitentiary at
Albany, Kew-lork, sines the appropriation of the peni
tentiary ofp* United States for the District of Colum
brahy the The average coat of trans
porting convict from ihis District to the penitentiary at
j lb-Any is about fifty dollaie, and that of maintaining
them there one cbellar and twenty-five cents per week,
or sia ty-fcve dollars per annamv It is confidently be-'
lieytd/that, wivh-'a penitentiary posaessing the an-'
pliances necessary for the judicious application of the
i abor of the convistv, they could be much more economi
cally maintained iathigDistrict, and the moral advan
tages secured to the «omm unity of having institutions of
this character locatsd intfceir midst.
nieGovemmeit nowowne atractof land, containing,
two hundted'and eljihty-one acres, upon which the re
ceiving reservoir of tte Washington aqueduct is situ
ated, which embraced-several suitable site* for a peni
tentiary, asd abouse for the detention and reform of
juvtsile offenders. Thaeo lands are now lying vacant.
*Jhere are excellent’ e&arriee immediately contiguous
thereto, from- which substantial buildings could ba
erected. They ceuid be-locate din close proximity to the
canal, whence :uel could be-obtained at the cheapest
rates, t’ewerage could be easily constructed, and alt ths
nectsEarr waterpower for propelling the requisite ma
chinery for the successful and proper employment of the
labor of the convicts could be procured from the surpiua
water of the reservoir at a very small cost I think It'-
would be good ecoromy to provide for the erection of
penitentiary baiUings- upon these lauds, and that it
would be well for Congress; at ics approaching session.
to make the necessary provision for ike commencement
of ;he work. In a very short time many of the convicts
could be provided with secure and comfortable quarters
upon the premises, and'employed in qnarryinz stone,
and other laboT pertaining to tie construction of sack
works.
The act of March 3, 3£53. making appropriations for
sundry civil txpenses of the Government for the year
ending June cC. 1564, and for the year ending June 30.
3562 1 , and for other purposes, transferred from the appro
priation made and placed under the control of the Secre
tary of the Tnaiury by the act of June 23, 1380, for the
detection and arrest of counrerfeirer* of the coin ofthe
Tnited States, the sum of eleven hundred and eighty
fourdoll&TS. or to much thereof as might be necessary
to enable the Secretary ofthe literior “ti pay detec
tive police employed by a former head of the Depart
ment, for expenses incuned and services rendered in
the cities of Washington an a Philadelphia in the detec
tion and arrest of counterfeiters of United States coin.
Baving examined all tbe claims presented, and found
thfm to have been liquidated and paid asper agreement
mace with the'c’aimants-prior to the rendition of the
service, ! recommend the passage of a lawto repeal tha
provision alluded to in the act of March 3, 1333. and to
lestcre the,amount thereby transferred to the control of
ike fiecietaivof the Treasury for the purposes originiUy*
designed;
While the African slave trade is known to be still car
ried on from some foreign poets to a lamentable extent,
it is gratifying to he able to state that so successful have
been the efforts of this Government to prevent citizens of
the United Hates from engaging in it, that not a single
vewel is known or believed fo have-been fitted outin
car own waters for that purpose during tbe past year,
and the wholesome examples wMch resulted from
the energy and vigilance which have been an * are still
being displayed by the cfiicers-fmroediately cnarged*
with Ihe enforcement of the laws on this subject, to
■ i ether with the growing tenre of'justice among our peo
ple towards the African race,-will, it is hoped, effectu
ally deter persons from any future participation in so
unrighteous a traffic.
The officers' appointed pursuant to the requirements of
the treaty of April 7.1552, with Great Britain, have re
paired-to their several stations; and the mixed courts of
justice, to reside at the city of 2few Tork. Sierra Leone,
and the Gape of Good Hope, have been duly organized
and established-. •
The accounts of the American Colonization Society
for the support o'recaptured Africans in Liberia have
not yet been finally' settled, owing to tbe imperfect
manner in which they have been kept by the resident
agent of the United States in that Republic, and by the
Liberian authorities after the transfer of the recautives
tothem.’ The information and facts required to be re
gularly reported not baving been recorded and praserved
by them, it is feared they cannot"now he obtained with,
the accuracy of- detail contemplated by the strict terms
of the contracts, end hence it is respectfully recom
mended that the Department he authorized by* law
to au just -and settle the accounts on equitable princi-
Kolfnrth er appropriation'is asked for this object, the
unexpended balances of former appropriations being
sufficient to meet all the legal demands that can possi
bly be made during the'present and the next ensuing
fi-caJ year. The re-enactment of the joint resolution of
Ed of Mai cb last, respecting the compensation of judges
and so foith, under the treaty with Great JBritian, and.
other persons employed in the suppression of the slave
trade,” will be necessary, however, to authorize the
use of tbr-se-fand&for the service of the-fiscatlyear end
ing the SOih of June, 1865.
- I am unable to report any greater disposition, gone
rally, among the colored persons, for-whose coloniza
tion provision was madeby certain recent acts of Con
gress, to emigrate,* than had been exhibited at the time
oi your last annual message. Since that time, however,
about four hundred snd fifty have been deported to the
He a Vache, adjacent and belonging to the Republic of
Hayti. The condition of this colony has been variously
represented, and an agent has been deputed by the De
partment to visit-the island and report the real situation
of affairs, and the future prospects of the emigrants
there They were emigrated under a contract entered
into for that purpose, with persons who were repre
sented &s possessing- every qualification and fitness for
insuring ihe success of the experiment; but nothing has
y et been paid them under it, nor will there be until the
report oi the agent shall have been received and found
toiustifyit.
In depend ent of the seeming unwillingness of this class
of persons to leave the United States,- the experience the
country has derived since the passage of the acts of Con
gress on the subject of colonization, and the action of tha
ovemment towards them in adopting the able-bodied,
men into its armies, render it a question of great im
portance whether-the-efiort to colonize them beyond the
limits of the United States should be continued, unless
the way' should be opened for the establishment of a
friendly colony.in some one of the Central American
States, at a favorable commercial point,- for traversing
that country by a new route to the Pacific.
Although much prejudice has been-manifested through
out most of the free States in regard to the introduction
of colored persons therein, there is a place where many
of them can now be'advantageously employed at remu
nerative prices, and where tr-e objection to color does not
exist. 1 refer to the line of the Pacific Railroad. Upon <
this work there are already about three hundred free co
lored laborers, ont of fifteen hundred employed, and I
am assured they perform their duty faithfully and well.
Tbe Department has been repeatedly urged to use its in- •
fluenco to cause as many colored- laborers as can bs
procured lobe employed on this work, and it is worthy
of consideration, therefore, whether the money appro
priated to remove those who are now a charge upon
the Government, to foreign countries, will not be more ■
judiciously applied in transporting* them to those fields-,
of labor within the dominions of the United States where
they are’wantea, and where they will be welcemed. In
this way the expfnse, to which the Government is now
subjected, will be-greatly diminished, and we-shall
have the satisfaction of placing these people in a position t
of usefulness,- security, and peace, where.they will be -
it strumental in the construction of a work in which the
ration has of all others, save the putting down of this .
rebellion, the.ereatest interest.
The need at the seat of. Government of a Bureau of
National Statistics has long been felt, and-often been
called to and engaged the attention of Congress, but so .
far without any p> actical result. The facts and Informa
tion which a properly organized bureau' of this charac- ..
ter would collect and exhibit are often indispensable, as
well to the enlightened legislator, as to the several de
partments of the Government and the people at large.
It is confidently believed that it would contribute im- -
men'ely to the advancement ofthe commercial, agricul
tural, financial, scientific, manufacturing, and other in
terests of our people, and, by the dissemination of cor
rect information as to our national wealth, interests*
and resources, lead to a more just appreciation of the
value to all of the American; Union, and contribute, in ,
no small degree, to the more universal establishment
and maintenance of friendly relations between ourselves..
and the other civilized nations of the earth.
Such a bureau could be established now with but lit-
tie outlay, and if made, to include the duty of enninera- .
tin g the population of the TJni cd States, for which pur- .
pose a bureau is now required to be temporarily or
ganized every ten years, at considerable expense and ;
labor, would effect a positive saving to the treasury,
while tbe work would be better performed, as the office
would then be permanent, and the experience gained in
tie operations of one decade not wholly lost before the
next was entered upon, as is. now the case, ifosten-.
lightened nations have, perceived the necessity and
utility of organized effort for the attainment of accurate .
statistical knowledge, and to profit by their experience
is the dictate of wisdom. Deeply impressed with the .
importance of the subject, I venture to refer to it again,
and to invoke for if the favorable consideration of Con
gress.
On the 3d of March, 1563, a joint resolution was an- .
acted authorizing and'nirectirg the Secretary of the In
terior. and. ail otter custodians thereof, to cause equal
distribution to be forthwith made among tbe members of
the two Houses of-the then-expiring Congress, of all
hooks and documents which had' been.printed or pnr
chaied at the cost of the Government, and not actually
belonging to any public library, or the library kept for .
use in any department of the Government, excepting,
however, all isuch books and documents as were em
braced in order for the distribution thereof •
among the members of either.. House of .Congress. I
-'found, on examination, that the numberof volumes of.-
the.docuiEants referred to, thjaix incompleteness as sets .
or works, and the uncertainty as to their value, aggre
gately or separately, were .such as.torender.it wholly
impracticable td'earry the provisions of the joint res/uo
tion into Sect, and the subject is therefore.respectfnlly .
submitted fbr the further* conn leration and action of •
'jotl™ past tlia Department has had to (ncouiitar
difficulties in providin g suitable accommodations for th®
TJniteu States courts in the dtr of New York. Congress.;
alone can apply the remedy, and it should no.t ba, longer
deferred- For many y jars apartments in the City .Hall
wire used for this pnir-pse, but theincreasingnecesßities
ofthe.mty demanded them, and they had tobe given up.
Since then the Department haslbeen obliged..to rent
oOerbuildings annually, or for a short term,Qf. years,
and to-alter and fit haem up at. considerable expense.
The premises -now umd were leased by the Department
in the year 1858, for the sum of sixteen thousand dollars
per annum. A large sum has been expepded.for altera
tions, occasional repairs, and furniture,, amounting, jo
six years, including, rent, to upwards of one hundred
and.twenty-five thousand dollars. The present lease of •
the sffopemy will, expire on tbe Ist of. May next. The
owner of it handled since the original lease was made,
and the executors, though still willing, to dispose of it at
tbe price then^xed—two.hundred and fifteen thousand
dollars—are averse to extending the lease, so that the ,
Department will soon hava to procure other .temporary
accommodations for the courts Bitting at New York city,
unless Congress, shall provide the means to secure per-.
xmnentOßsa.
The Government baa pnrehased or erected buildings
at Philadalphia, Boston, and a number of loss important
cities, for the. use of the' Federal courts and for other
public purposes and aommencedfhe erection of one also.
at Baltimore. The propriety of extending this prudent
policy to the city of New York seems too manifest to re-,
quire-argnment. Sconomy alone demands it.
. The Department is not .prepared to say that the pur .
chase of the building now. used,, for the fj¥± l M*®?v
wouJd be the mbstadvantageons SvsSIJHJ;
he made: buf.it would, in the the saving of
considerable txnenee to the treasury. 1, therefore,
eaSesbly reotsuamd thatthe Department be empowere*
ly Cmireesto provide tuitable and permanent accom
modaHnne htv the Suited States eonrts at Her" York, and.
ftaten l/emmte a“ppr M riaSion be made for that pur-'
Pacific Eailroad Company, chartered by.
the act l entitled “An act to aid lathe con
etrnction of a*ailroad and telegraph line from the Mis-.
"tonri river to the Facifio ocean, and to secure to the Co
vernmSt tne use of the same for postal military, anw
other pnrpcefs,” approved Jnly 1, 1562, haa been or
oflnltfld by the election, of directors and other officers,
lid the subscription of tbe requisite amount of stock. ’
ova character and pecuniary ability of the stockholders
ntfard the most ample guarantee that this gTeat worK
•will be prosecuted to a snccsssful isbuo. The work upon,
tbe branch lately located by you has already been com
menced with a determination to press'll to. a rapid com
pletion, despite the inclemency of the season and otiiec
branch of the road, having-!it|
terminus at the mouth of the Kansas river, and now
known as that of tbe “ Pacific Bad Toad Company,
eastern divieion.” is being constructed With tmpajflJlelGd
energy. Since the first of September last,, about forty
miles of this branch have been graded, tne ties made
«a!y, the iron and rolling stock purchased and delivered
or now in transitu. We have, assn
rances upon which a well-founded belief maybe based,
tbftt eaTlv next month it will be completed, and daring
vfieaSS eSed to Fort KUey, a distance of about
OD ThVprin e fipavl)hßtacTeto the rapid progresa of the work
is the ecarcity of labor, which may be overcome by the
employment of the freedmen, as before indicated in this
branch of the Pacific BaUroaiiibsimi.
coaijtf'Wife pisictlea'W,. despatch, gg.4 tbin »