"the most decided measures that Oelong to the powers and obligations of the represen tative office." Notwithstanding this warn ing, the banishment was eiilorced, and Mr. Forsyth promptly announced to the govern ment the suspension ol the political relations ol his legation with them, until the pleasure of his own government should be ascertain ed. did not regard thecontri bntion imposed by tlio decree of the 15 li May last to be in strictness a ' forced loan," and as such prohibited by the 10th article of the treaty of IB2H between Groat Britian and Mexico, to the benelits of which American citizens are entitled bv treaty: yet the imposition of the contribution upon foreigners was considered an unjust and oppressive measure. Besides, interne! fac tions in other parts of the republic were at the same time levying similar exactions upon the properly ol our citizens, and inter rupting their commerce. There had been an entire failure on the part of our minister, to secure redress for the wrongs which, our citizens had endured, notwithstanding his persevering efforts. And from the temper manifested by the Mexican government, lie had repeatedly assured us that no favorable change could be expected, until the United Stales should 'give striking evidence of their will and power to protect their citizens," and that "severe chastening is the only earthly remedy for our grievances." From this statement of facts, it would have been worse than idle, to direct Mr. Forsyth to retrace liis steps and resume diplomatic relations with that government; and it was, therefore, deemed proper to sanction his withdrawal of the legation from the city ol Mexico. Abundant cause now undoublly exists, for a resort to hostilities against the govern ment still holding possession ol the capital. Should they succeed in subduing the con stitutional forces, all reasonable hope will then have expired of a peaceful settlement of our difficulties. On the other hand, should the constitu tional parly prevail, and their authority be established over the republic, there is reasot. , to hope that they will be animated by a less unfriendly spirit, and may grant that redress to American citizens which justice requires, so far as they may possess the means. But for this expectation, i should at once have recommended to Congress to grant the necessary power to the President, to take possession of a sufficient portion of the re mole and unsettled territory of Mexico, to be held in pledge until our injuries shall bo redressed and our just demands be satisfied. We have already exhausted every milder means of obtaining justice. In sucli a case, this remedy of reprisals is recognised by the law of nations, not only as just in itself, but as a means of preventing actual war. But there is another view of our relations with Mexico, arising from the unhappy con dition of affairs along our southwestern frontier, which demands immediate action. In that remote region, where there are but lew white inhabitants, large bands of hostile and predatory Indians roam promiscuously over the Mexican Sates of Chihuahua and Sonora, and our adjoining territories. The local governments of these States are per fectly helpless, and arc kept in a state of constant alarm by the Indians. They have not the power, if they possessed the will, even to restrain lawless Mexicans from passing the border and committing depreda tions on our remote settlers. A state of anarchy and violence prevails throughout that distant frontier. The laws arc a dead letter, and life and property are wholly in secure. For this reason the settlement of Arizona is arrested whilst it is of great im portance that a chain of inhabitants should extent all along its southern border, sufficient for their own protection and that of the U. Slates mail passing to and from California. Well founded apprehensions are now enter tained, that the Indians, and wandering Mexicans equally lawless, may break up the important stage and postal communica tion recently established between our Atlan tic and I'r.cific possessions. This passes very near to tlie Mexican boundary, throughout the whole length of Arizona, i can imagino 110 possible remedy lor these evils, and no mode of restoring law and or der on that remote and unsettled frontier, hut for the government of the United Slates to assume a temporary protectorate over the northern portions of Chihuahua and Sonora, and to establish military posts within the satno—and this I earnestly recommend :o Congress. This protection may 'be with drawn, as soon as local governments shall be established in these Mexican States, capable of performing their duties to the United States, restraining the lawless am preserving peace along the border. I do not doubt that this measure will bo viewed in a friendly spirit by the govern- J meats and people oft.hihuahuaand Sonora, u as it will prove equally effectual for the pro tection of their citizens on that remote and lawless frontier, as for citizens of the United States. And in this connexion, permit me to re call your attention to the condition of Ari zona. The population of that Territory, numbering, as is alleged, more than ten thousand souls, are practically without a government, without laws, and without any regular administration of justice Murder and other crimes are committed with im punity. This state of tilings calls loudly iorredress; and I. therefore, repeat my re commendation for the establishment oi a territorial government over Arizona. The political condition ol the narrow Isthmus of Central America through which transit routes pass, between the Atlantic and Pacific oceaii9, presents a subject of deep interest to all commercial nations. It is over these transits, that a large proportion of the trade and travel between the Euro pean and Asiatic continents, is destined to pass. To the United States these routes are of incalculable importance, as a means of communication between their Atlantic and Pacific possessions. The latter now extend throughout seventeen degrees of latitude on the Pacific coast, embracing the important State of California and the nour ishing Territories of Oregon and Washing ton. All commercial nations, therefore, have a deep and direct interest, that those communications shall be rendered secure from interruption. If an arm of the sea, connecting the two oceans, penetrated through Nicaragua and Costa Rica, it could not be pretended that these Slates would have the right to arrest or retard its naviga tion, to the injury of other nations. The transit by land over this narrow Isthmus, occupies nearly the same position. It is a highway in which they themselves have little interest, when compared with the vast interests of the rest of the world. Whilst their rights of sovereignly ought to be re spected, it is the duly ol other nations to require, that this important passage shall not be interrupted, by lite civil wars and revo lutionary outbreaks, which havo so frequent ly occurred in that region. The stuke is too important, to be left at the mercy of rival companies, claiming to hold conflicting con tracts willt Nicaragua. The commerce of other nations is not to stand still and await the adjustment of such petty controversies. The government of the United States expect no more than this, and they will not be sat isfied with less. They would not, if they could, derive any advantage from the Nica ragua transit, not common to the rest of the wrold. its neutrality and protection, for the common use of ull nations, is their only object. They have no objections that Nica ragua shall demand and receive a fair com pensation, from the companies and individ uals who may traverse the ronte ; but they insist that it shall never hereafter be closed, by an arbitrary decree of that government. I 11 disputes arise between it and those with whom they may have entered into contracts, | these must be adjusted by some fair tribu nal provided for the purpose, and the route must not be closed pending the controver sy. This is our whole policy, and it can not lail to be acceptable to oilier naiions. All these difficulties might be avoided, if, consistently with the good faith of Nicara gua, the use of this transit could be thrown open to general competition ; providing at lite same time for the payment of a reasona ble rate to the Nicarognan government, on passenners and freight. in August, 1852, the Aneessory Transit Company made its first interoceanic trip over the Nicaraguan route, and continued in successful operation, with great advan tage to the public, until the 18th February, 1856, when it was closed, and lite grant to this company, as well as its charter, was summarily and arbitrarily revoked by the government of President Ilivas. Previous to litis date, however, in 1854, serious dis putes concerning the settlement of their accounts had arisen between the company and the Government, threatening the inter ruption of the roulo at any moment. These the U. S. in vain endeavored to compose. It would be useless to rarrule the various proceedings which took place between the parties, up till the time when the transit was discontinued. Suffice it to say, that, since February, 1856, it has remained clos ed, greatly to the prejudice of citizens of the 'lulled States. Since that time (lie com petition lias ceased betweon the rival routes ol Panama and Nicaragua, and, in conse quence thereof, an unjust ami unreasonable amount has beon exacted from our citizens for their passage to arid from California. A treaty was signed on the 16th day of November, 1857, by the Secrelary of State and Minister of Nicaragua, under the stipu lations of which the use and protection of the transit route would have been secured, not only to the Uniiou States, bui equally to all other nation?, How and on what pre text this treaty has failed to receive the rat ification of the Nicaraguan Government will appear by the papers herewith commu nicated from the Slate Department, 'lite principal objection seems to have been to lite provision authorizing the United States to employ force to keep the route open, in case Nicaragua should fail to perform her duty in this respect. From the feebleness of that republic, its frequent changes of government, and its constant internal dissensions, this bad be come a most important stipulation, and one essentially necessary not only for the secur ity of the roulo, but for lite safety of Ameri can citizens passing and repassing to anil from our Pacific possessions." Were such a stipulation embraced in a treaty between the United States and Nicaragua, the knowl edge of this fact would of itself most proba bly prevent hostile parties from committing aggressions on the route, and reialer our actual interference for its protection unnec essary. The Executive Government of this coun- | try, in its intercourse with foreign nations, j is limited in the employment of diplomacy alone. It cannot legitimately resori to force | without the direct authority of Congress, ! except in resisting and repelling hostile at- | tacks. It would have 110 authority to enter j the territories ol Nicaragua, even to prevent j the deslruction of the transit, and protect 1 the lives and property ol our own citizens on their passage It is true that, 011 a sud den emergency of this character, the Presi nent would direct any armed lorce in the vicinity to march to their relief; hut in doing this he would act upon his own responsi bility. Under these circumstances, I earnestly recommend to Congress the passage of an j act authorizing the President, under such restrictions as they may deem proper, to '< employ the land and naval forces of the U. j S. in preventing the transit from being ob- ] strucled or closed by lawless violence, and in protecting the lives and properly of Amer- ! ican citizens travelling thereupon, requiring at the same time that these forces shall be withdrawn the moment llio danger shall have passed away. Without such a provis ion, our citizens will be constantly exposed to interruption in their progress, and to law. 1 less violence. A similar necessity exists for the passage of such an act for the protection j of the Panama and Teliuantepec routes. In reference to the Panama route, the U. S. by their existing treaty with New Gratia- j da, expressly guarantee the neutrality of the Isthmus, "with the view that the free tran sit from one to lite other sea ntay not he interrupted or embarrassed in any future time while this treaty exists. lit regard to the Teliuantepec route, which has been recently opened under the most favorable auspices, our treaty with Mexico of llio 30th December, 1853, secures to the citizens of the United States a riglu of transit over it for their persons and merchandise, and stipulates that neither Government shall ' interpose any obstacle'' thereto. It also concedes to the United Stales die "right to transport across the Isthmus, in closed : bags, the mails of the Uuiled States not in tended for distribution along the line of the communication; also, the elfect ol'llie U. S. Government and its citizens which may be intended for transit and not for distribution on tiio Isthmus, free of custom house or other charges by the Mexican government." These treaty stipulations with New Gra nada and Mexico, in addition to the consid erations applicable to the Nicaragua route, seem to require legislation lor the purpose of carrying them into elfect. 'the injuries which have been inflicted upon our citizens in Costa Iltcaand Nicara gua, during the la-t two or three years, have received the prompt attention of this Gov eminent. Some ol these injuries were of the most aggravated character. The trans action at Virgin lluy in April, 1850, when a company of unarmed Americans, who were in no way connected with any belligerent conduct or party, were fired upon by the troops of Cos'.a Rica, and numbers of them killed and wounded, was brought to the knowledge of Congress liy my predecessor soon after its occurrence, and was also pre sented to the government of Costa llica, for that immediate investigation and redress 1 which the nature of the case demanded. A similar course was pursued with refer ence to other outages in those countries, some of which were hardly less aggravated in their character than the transaction at Virgin Bay. At this time, however, when our present Minister to Nicaragua was ap pointed, in December, 1857, no redress had been obtained for any of these wrongs, and no reply even had been received to the de mands which had been made by this gov ernment upon that of Costa ilica, more than a year before. Our minister was in structed, therefore, to lose no lime in ex pressing to those governments the deep regret with which the President had witnes sed this inattention to the just claims of the U.S., and in demanding their prompt and satisfactory adjustment. Unless this demand shall bo complied with at an eurly day, it will only remain for this government to adopt such other measures as may be neces sary, in order to obtain for itself that justice which it has in vain attempted to secure by peaceful means from the governments of Nicaragua and Co-ta Ilica. While it has shown, and will continuo to show, the most sincere regard lor the rights and honor of these Kopublics, it cannot permit this regard to be met by an utter neglect on their part, ol what is due to the government and cilizons of the United Stales. Against New Grenada we have long stan ding causes of complaint, arising out of the unsatisfied claims of our citizens upon that Republic; and In (best) liavo been more re cently added the outrages commuted upon onr citizens at Panama, in April, 1856. A treaty for the adjustment of these difficulties was concluded by the Secretary of Stale and the Minister ot New Granada, in Sept., 1857, which contained just and acceptable provisions for that purpose. This treaty was transmitted to Bogota, and was ratified by the Government of New Granada, but with certain amendments. It was not, however, returned to this city until after the close of the Inst session of the Senate. It will be immediately transmitted to that body for their advice and consent; and should this be obtained it will remove all onr existing causes of complaint against New Granada on the subject of claims. Questions have arisen between the two governments as to the right of N. Granada io levy a tonnage duty upon the vessels of the United States in its ports of the Isth mus, and to |evy a passenger tax upon our citizens arriving in that country, whether with a design to remain their or to passfrom ocean to ocean by the transit route; and also a tax upon the mail of the U States transported over the Panama Bail Road.— The Government of New Granada has been informed that the U. S. would consider the collection of cither of these taxes as an act in violation ol the treaty between the two countries, and as such would be resisted by the United States. At the same lime, we are prepared to discuss these questions in a spirit of amity and justice, and with 11 since desire to adjust them in a satisfactory manner. A negotiation for that purpose has already been commenced. No effort lias recently been made to collect these taxes, nor is any anticipated under present circumstances. With the empire of Brazil our relations are of the most friendly character. The productions ol the two countries and espe cially those of an agricultural nature, are such as to invite extensive mutural ex change*. A large quantity of American flour is consumed in Brazil; whilst more than trcbhle the amount in value of Brazil ian colfee is consumed in the U. S. Whilst tliis is the case a heavy duty has been levied, until very recently, upon the impor tation ol American flour into Brazil. lam gratified, however, to he able to inlorm you that in Sept., 1858, this has been reduced to from SI 32 to about -19 cents per barrel, and the duties on other articles of our produc tion have been diminished in nearly the same proportion. 1 regret to state that the government ol Brazil still continues to levy an export duty of 11 per cent on cofi'ee, notwithstanding this article is admitted tree from duty in the U. S. This is a heavy charge upon the consumers ol coffee in our country, as we purchase halt the entire surplus crop of that article raised in Brazil. Our Minister, under instructions, will reiterate his eflerts to have this export duty removed; and it is hoped the enlightened Government Empe ror will adopt this wise, just andequal pol icy. In that event there is good reason to believe that lite commerce between the two countries will greatly increase much to the advantage of both. The claims of our citizens against the Government of Brazil are not, in the aggre gate, of very large amount; but some of these rest upon plain principles of justice, and their settlement ought not to be longer delayed. A renewed, and earnest, and, I trust, a successful effort will be made by our Minister to procure their final adjust ment. 011 the second of Juno last, Congress pas ed a joint resolution authorizing the Presi dent "to adopt such measures and use such force as, in his judgment, may he necessary and advisable," "for the purpose of adjust ing the difference between the U. States and the Republic of Paraguay, in connec tion with the attack 011 the United Slates steamer Water Witch, and with other meas ures referred to" in his annual message.— And on 1 lie 12th July following, thoy made an appropriation to defray the expense and compensation ol a commissioner to that Republic, should the President deem it proper to inake such an appointment. Incompliance with these enactments, I have appointed a commissioner, who has proceeded to Paraguay with full powers and instructions 10 settle these differences 111 an amicable and peaceful manner, if this be practicable llis experience and discre tion justify the hope that lie may prove sue cesslul in convincing the Paraguayan Gov ernment that it is due, both and justice, that they and promptly make which they have U- Slates, and indemnify citizens whom they have forcibly wprived of their property. Should onr commissioner provo unsuccess ful, after a sincere and earnest eifort, to ac complish the object of his mission, tlion 110 alternative will remain but the employment of force to obtain ' just satisfaction" trom Paraguay. In view of this contingency the Secretary of the Navy, under my direction, has fitted out and despatched a naval force to rendezvous near Beunos Ayres, which it is believed will prove sufficient for the oc casion. it is my earnest desire, however, that it may not be found necessary to resort to this last alternative. When Congress met in December Inst, the business of the country had just been crushed, by one of those periodical revul sions which aro tho inevitable consequence of our unsound and extravagant system of bank credits nnd inflated currency. With all the elepients of national wealth in abun dance, our manufactures were suspended, our usual public and private enterprises were arrested, and thousands of laborers were deprived of employment, and reduced to want. Universal distress prevailed a ntoiig the commercial, manufacturing, and mechanical classes. This revulsion was felt the more severely in the United Slates, because similar causes had produced the like deplorable effect throughout tho commercial nations oi Eu rope. All were experiencing sad reverses at lite same moment. Our manufactures everywhere suffered severely, not because of lite recent reduction in the tariff of duiies 011 imports, but because there was no de mand at any price for their productions.— Tito people wore obliged to restrict them selves, in their purchases, to articles of 1 prime necessity. In the general prostra tion of business, the iron manufacturers iri different States, probably suffered moto than any other class, and much destitution was the inevitable consequence, among the great number of workmen who had been em ployed in this useful branch of our industry. There could be no supply where there was no demand. To present an example; there could bo 110 demand for railroad iron, after our magnificent system of railroads, ox tending its benefits to every portion of tho Union, hud been brought to a dead pause. The same consequences have rcsultod from similar causes to many other branches ol useful manufactures. It is self evident that whore there is no ability to purchase manu factured articles, these cannot be sold and consequently must cease to be produced. No government, and especially a govern ment of such limited powers as that of the United Suites, could have prevented the late revulsion. The whole commercial world scorned for years to have been rushing to this catastrophe, Tho same ruinous conse quenees would have followed in the United States, whether the duties upon foreign im ports had remained as the were under the tariff of 1846, or had been raised to a much higher standard. Tho tariff of 1857 had no agency in the result. Tho general causes existing throughout tho world could not have been conlroled by llio legislation of any particular country. 'I lie periodical revulsions which have! existed in our past history must continue to ' return at intervals, so long as our present unbounded system of bank credits shall pre vail. They will, however, probably be the less severe in future, because it is not to be expected, at least for many years to come, that the commercial of Europe with whore iulcty'stGVir own are so. materially involved,, will expose themselves to sipiilnr calamities But this subject was treated so much at large in my last message, that I shall not now pursue it further. Still.* I re spectfully renew the recommendation in lavor of the passage of a uniform bankrupt law, apptlmrblo to banking institutions. This ,is all the power over the subject which 1 believe, the Federnl government possesses. Such .a law would mitigate, though it might not prevent the evil. The instinct of self preservation might produce a wholesome restraint upon their banking business if they know in advance that a suspension ol specie payments would inevitably produce their civil death. But the efi'octs of llio revulsion arc now slowly but surely passing away. The en crgy and enterprise of our citizens, willi our unbounded resources, will, within the period of another year, restore a state of wholesome industry and trade. Capital has again accumulated in our large cities; the rate of interest is there very low; confi dence is gradually reviving, and so soon as it is di-covered that this capital can bo profitably employed in commercial and manufacturing enterprises, and in the con struction of railroads and other works of public and privnte improvement, prosperity will again smile through the laud. It is 111 vain, however, to disguise the fact from ourselves that a speculative inflation of our currency, without it corresponding inflation in other countries whose manufactures come into competition with our own, must ever produce disastrous results to our domestic manufactures. No tariff, short of absolute prohibition, can prevent these evil conse quences. In connection with this subject, it is proper to refer to our financial condition. Tho same causes which have produced pecuniary dis tress throughout the country, have so reduced the amount of imports from foreign countries that the revenue lias provod inadequate to meet tho necessary expenses of tho govern ment. To supply the deficiency, Congress, by the act of the 23rd of December, 1857, authorized the issue of $20,000,1)00, treasury notes; and litis proving inadequate, they authorized, by the act of June 14th, 1858, a loan ot $20,009,000, "to be applied to the payment of appropriations made by law." No statesman would advise that we should go on increasing the national debt to meet lite ordinary expenses of Government.— This would be a most ruinous policy. In case of war, our credit must be our chief resource, ut least ior the first year, and this would be greatly impaired by having con tracted a large debt in time of peace. It is true policy to increase our revenue so as to equal our expenditures. It would be ruin ous to continue to borrow. Besides, it may be proper to observe, that the incidental protection, thus afforded by a revenue tariff', would at the present moment, to some ex tent, increase the confidence of the manu facturing interests, and give a fresh impulse to our reviving business. To this, etirely, no person will object. lit regard to the topde of assessing and collecting duties under a strictly revenue tariffi, I have longentertained and expressed the opinion that sound policy requires litis should be done by specific duties, in cases to which these can be properly applied.— They _iye well adapted 10 commodities which usually sold by weight or measure, and which, irom their nature, are of equal or of nearly equal value. Such, for exam ple, are the articles of iron of difierent clas ses, raw sugar, and foreign wines and spir its. in my deliberale judgement, specific du- j ties are the best, if not the only means of j securing lite revenue against false and fraud- I ulent invoices, and such has been the prac- ! tice adopted for tliis purpose by other j commercial nations. Besides, specific i duties would airord to tho American tnanu- i facluror the indental advantages to which j lie is fairly entitled under a revenue tariff. The present system is a sliding scale to his I disadvantage Under it, when prices are j high nnd business prosperous, the duties 1 rise in amount when he least requires their ; aid. On the contrary, when prices fall, and I he is struggling against adversity, the duties | aro diminished in the same proportion, I greatly to his injury. Neitlejr would there bo danger that a ! higher rale of duty than that intended by | Congress, could be levied in the form of j specific duties. It would be easy to ascer- ( tain the average value of any imported j article for a series of years; and instead of! subjecting it to an ad valorem duly at a ' certain rate per centum; to substitute in j its place an equivalent specific duty. By snob au arrangement the consumer i would not be injured. It is true, he might j have to pay a little more duty 011 a given I article in one year; but if so, he would pay i a little less in another, and in a series of ! years these would counterbalance each other, and amount to the same thing, so fur as his interest is concerned. This incon venience would be trilling, when contrasted with the additional security thus afforded against frauds upon the revenue, in which every consumer is directly interested. 1 have thrown out these suggestions aR the fruit oi my own observation, to which Con gress, in their belter judgment, will give such weight as they may justly deserve. The report of the Secretary of the Treas ury cxpiairtSjjn detail, the operations of that department of the Government. The re ceipts into the Treasury, from all sources, during the fiscal year ending tho 30th of June, 1858, including the treasury notes authorized by the act of Decomber 23d, 1857, wore seventy million two hundred and sevenly-lhreo thousand eight hundred and sixty-nine dollars and fifty nine cents ($7O 273,869 59.) which amounts with the balance ol seventeen million seven hundred and ten thousand one hundred and fourteen dollarß and twenty seven cents, ($l7 710.114 27) remaining in the Treasury at the com mencement of the year, made an aggregate for the service ot the year eighty seven million nine hundred and eighty throe thousand nine hundred and eighty three dol lars and eighty six eonts ($B7 983,983 86. The public expenditures during the fiscal year ending June 30, 1858, amounted to eighty one million five hundred and eighty five thousand six hundred and sixty seven dollars and seventy six cents [BBl 589,667,- 76.] of which nine million six hundred and eighty four thousand five hundred and thirty seven iloHarsaml ninety nine cents [59,684,- 535, 99 A were applied to the payment of lite public'ucbt, and the redemption of treasury notes with the interest thereon, leaving the Treasury on July 1, 1858, being the com meneemertt of the present fiscal year, six million three htindred and ninety eight thousand three hundred and sixteen dollars and ten centr, [56,398,318,10.] The receipts into the Treasury, during the firs', quarter of the present fiscal year, com mencing the Ist July, 1858, including one half of the loan of twenty millions of dol lars. with the premium upon it, authorized hy the act of 14th June, 1868, were twenty five millions two hundred and thirty thou sand eight hundred and seventy-nine dollurs and forty-six cents, ($25,230,879.46,) and the estimated receipts for the remaining three quarters to the 30 June, 1859, from ordinary sources, uro thirty-eight million five hundred 1 thousand dollars, ($38,500,C00,) making, with tho balance before stated, an aggregate of seventy million one hundred and j nine thousand one hundred and ninety-five | dollars and filty-six cents ($70,129,195 56.) 1 The expenditures, during the first quarter 1 oftlie present fiscalyear,weretwenty onemil- 1 lion seven hundred and eighty thousand one 1 hundred and ninety-eight dollars and fiity one cents, ($21,701,198.51.) of which or.e ] million ten thousand one hundred and forty- i two dollars and thirty-seven cents, ($l,OlO,- ] 142.37,) were applied to the payment of the i public debt, and the redemption ol treasury 1 notes-and tlie interest thereon. The eslirnat- 1 ed expenditures, during the remaining three 1 quarters, to 30th June, 1859, are filty-two million three hundred and fifty-seven thou- 1 sand six hundred and ninety-eight dollars 1 and forty eight cents, ($52,357,698.48,) mak ing an aggregate of seventy-four millions sixty-five thousand eight hundred and ninety six dollaTs and ninety-nine cents, ($74,065,- 896,99,; being an excess of expenditure beyond the estimated receipts into the Treasury from ordinary sources, during the fiscal year to the 30th June, 1859, of three million nine hundred and thirty-six thousand , seven hundred and one dollars and iorty throo cents, ($3,936,701,43.) Extraordina ry means aro placed by law within tho com- 1 maud of the Secretary of the Treasury, by the re issue of treasury notes redeemod, and by negotiating the balance' of tho loan au- , thorized by the act of 14th June, 1858,tothe extent ol eleven millions,ol dollars, which if realized during the present fiscal year, will | leave a balance in the Treasury, on the first 1 day of July, 1859, of seven million sixty- 1 throe thousand two hundred and ninety- 1 eight dollars and fifty-seven cents, ($7,063,- j 298 57 ) 1 The estimated receipts during the next 1 fiscal year ending 30lh June, 1860, are sixty- 1 two millions of dollars ($62,000,000) which 1 with the above estimated balance of seven million sixty three thousand two hundred 1 and nincty-eightdollars and fifty-seven cents, 1 ($7,063,298,57 ) make an aggregate for the ( next fiscal year of sixty-nine million sixty- 1 three thousand two hundred and ninety- , eight dollars and fifty-seven cents, ($69,063, 1 298 57. The estimated expenditures during the next fiscal year, ending 30th of June, , 1860, are seventy-three million one hundred I and thirty-nine thousand one hundred and I < forty-seven dollars and ioriy-six ! ] 139,147.46,) which leaves a deficit of esti mated means, compared with the estimated expenditures lor that year, commencing 011 the first of July, 1859, of four million and seventy-five thousand eight hundred and forty-eight dollurs and eighty-nine cents, ■ ($4,075,848.89.) In addition to this sum, the Postmaster General will require from the Treasury, for I the service of the Post Oifico department, | three million eight hundred and thirty-eight j thousand seven hundred and twenty-eight dollars, ($3,838,728,) as explained in lite re- j port of tho Secretary oi the Treasury, which j will increase the estimated deficit on the 30th 1 June, iB6O, to seven millions nine hundred j and fourteen thousand five hundred and sev enty-six dollars and eighty-nine cents, ($7,- [ 914,576,89 ) To provide for the payment of this estimated deficiency, which will be j increased by such appropriation as may be I made by.Congress, not estimated for in the report of the Treasury Department, as well as to provide for the gradual redemption, | Irom year to year of llio outstanding treas ; ury notes, the Secretary of the Treasury recommends such a revision oi the present. , tariff as will raise the required amount.— ! After what I have already said I need scarce- ' ly add that 1 concur in the opinion expressed ; in his roport, that llio public debt should not 1 I be increased by an additional loan, and : I would thereiore strongly urge upon Congress I j the duty of making at their present session, | the necessary provision for meeting these ! j liabilities. j The public debt on the Ist July, 1858, the ' commencement of the present fiscal year, 1 j was $25,155,977.66. | During the first quarter of the present year, j I the sum of $lO 1)00,000 has been negotiated ! ! of the loan authorized by the act of 14th } j June ? 1858—making tiie presentoutstanding j I public debt, exclusive, of treasury notes, j $35,155,977.66. There was on the Ist of Ju- ' ' ly, 1858, of treasury notes issued by author-' ity of lite act of December 23, 1857, un-re- 1 ' deemed, the sum of $19,754,800 —making j j the amount of actual indebtedness, at that 1 date, $54,910 777.66. To this will bo added ; ] $10,000,000 during lite present fiscal year— : j this being the remaining half ol' the loan I j of $20,000,000 not yet negotiated. I The rapid increase of the public debt, and j the necessity which exists for a modication j ! of the traiff, to meet even the ordinary ex-! ( penses of the Government, ought to admon- j j tsh us all, in our respective spheres of duty, j to the practice of rigid economy. The ob- j j jects ol expenditure should be limited in j number, as far as this ntay be practicable, | j and the appropriations necessary to carry | them into effect ought to be disbursed under ■ I the strictest accountability. Enlightened j I economy does, not consist in the refusal to 1 J appropriate money for constitutional purpo- j I ses, essential to the defence, progress, and | prosperity of the Republic, but taking care 1 j that none of litis money sliall be wasted by j mismanagement, in its application to tho j objects designated by law. Comparisons between the annual expen- j ( diture at the present time, and what it was j [ ten or twenty years ago, are altogether falla cious. Tho rapid increase of our country in ' I extent and population renders a correspon- , j ding increase of expenditure,to some extent, 1 j unavoidable. This is constantly creating j new objects of expenditure, and augment- j ing the amount required for the old. Tho I ! true questions, then, are, have these objects j | been uuneeessarially multiplied ? or, has the j amount expended upon any or all of them been larger titan comports with due ecofto- | my? In accordance with these principles, j the heads of the difierent executive depart ment of the Government have been instruc- j ed to reduce their estimates for the next fiscal ] yearto tbeloweststandardconsistent with the : efficiency of tho service, and this duty they | have performed in a spirit of just economy. I The estimates of the Treasury, War, Na- ; vy, and Interior Department have each been in some degree reduced ; and unless ; a sudden and unforeseen emergency should j arise, it is not anticipated that a deficiency j will exist in either within the present or ttie next fiscal year. Tne Post Office Depart- j rnent is placed in a peculiar position, differ- j ent from tho other departments, and to this 1 shall hereafter refer. I invite Congress to institute a rigid scruti ny to ascertain whether the expenses in all the departments cannot bo still reduced; and I promise litem all the aid in my power in pursuing the investigation. I transmit herewith the reports made to me by tho Secretaries of War, of the Navy, of the Interior, and of the Postmaster Gen eral. They each contain valuable informa tion and important recomcndations, to which i invite the attention of Congress. In my lastatinual message I took occasion to recommend the immediate construction of ten small steamers, of light draught, for the purpose of increasing tho efficiency oi the navy. Congress responded to the recommen dation by authorizing the construction of 1 eight of them. The progress which hasbeen made in executing this authority is stated in the report of the Navy. 1 concur with him in the opinion that a greater number of this class of vessels is necessary for tho purpose 1 of protecting in a more efficient manner the persons and property of American citizens i on the high seas, and in foreign countries, as well as in guarding more effectually our own oosis s. I accordingly recommend the passage of an act for this purpose. The suggestions contained in the report of Secretary of the Jnterior,especially those Wrregard to the disposition of the public do main, the pension and bounty land system, the policy towards the Indians and the amendment.of our patent laws, are worthy of the serious consideration of Congress. The Post Office Department occupies a position very different from that of the other department''. JTor many years it was the policy of Ihe Government to render this self sustaining department; and if this cannot now be accomplished, in the present condi tion of the country we ought to make as near an approach to it as may be practicable. The Postmaster General is placed in a most embarrassing position by the existing laws. He.is obliged to carry these in o ef fect. He has 110 other alternative. He finds, however, that this cannot bo dona without heavy demands on the Treasury, over and above what is received for postage; and these have been progressively increasing from year to year until they amounted for the I last fiscal year, ending on the 10th June, I 1858, to more than four millions and a half of dollars; whilst it is estimated that, for the present fiscal year, they will amount to $6,- 290,000. These sums are exclusive of the aunual appropriation of $70,000 for ' com pensation for the mail service performed for the two houses of Congress uud tlio other departments and officers of tho Government in the transportation of free matter." The cause of these large deiicits is main ly attributable to the increased expouso of transporting the mails. In 1852 the sum paid lor this service was but a fraction abovo four million and a quarter. Since that year it has actually increased until in 1858 it has reached moro than eight million and a quar ter, and for service of 1859 it is estimated that it will amount to moro than ten million of dollars. Hie receipts of the Post Office Department can be made to approach or to equal its ex penditure, only by means of tho legislation ! of Congress. In applying any remedy, care j should be taken that the people shall not be j deprived of the advantages which they are '• fairly entitled to enjoy from tho Post Office I Department. The principal remedies re- ' contended to the consideration of Congress I by the Postmaster General, we are to restore ' tho former rate of postage upon single let- j letters to five cents,to substitute tor the frank- | ittg privilege the delivery to those now en titled to enjoy it, of post office stamps forj their correspondence, and to ditect tho de- ' partment, in making contracts fot the trans- j portation of the mail, to confine itself to the ! ■payment of tho snra necessary for this sin- j ! glo purposes, without requiringil to bo trans ported in post coaches or carriages of any j peculiar description. Under the present system, the expense to the Government is j greatly increased, by requiring that the ! mails shall be carried in such vehicles as ] will accommodate passengers! This will ! be done without pay from the department, i over all roads where the travel will remuner- | ate the contractors. Tliese recommendations ; i deserve tho grave consideration of Congress | I would again call your attention to the i construction of a Pacific railroad. Timeand j j rellectiou have but served to confirm me in I the truth and justice of the observations | which I made on this subject, in my last | annual message, to which 1 beg leave re spectfully to refer. it is freely admitted that it would be inex pedient for this Government to exercise the | power of constructing the Pacific railroad j by its own immediate agents. Such a policy ; i would increase the patronago of tho execu- i ; live to ti dangerous extent, and induce a j i system of jobbing and corruption, which no j ; vigilance oil tlio part ol bedoral officials ( . could either prevent or detect. This can | | only be done by tho keen eye, and the active j | and careful supervision of individual and j I private interest i The construction of this road ought, there-1 ; fore, to be committed to companies inoor- j [ poraled by the States, or other agencies j whoso pecuniary interests would bo directly i involved. Congress might then assist thetri ! | in the work by grants ot land or of money, | i or Doth, under such conditions and restric- j l lions as would secure tho transportation of j | troops and munitions of war free from any | i charge, and that of the United Slates mail at a fair and reasonable price. ! The progress of events since the com ! mencenten'. of your last session has shown ' how soon difficulties disappearbefore a firm ; and determined resolution. At that time j such a road was deemed by wise and patri otic men to be a visionary project. The great ! distance to be overcome, and the intervening I ! mountains and deserts in the way, were ob stacles which, in the opinion of many, could | j not be surmounted. Now after the lapse of ; but a single year, these obstacles, it has been i discovered, are far less formidable than they j , were supposed to be; arid mail stages, with J I passengers, now pass and repass regularly, twice in each week, by a common wagon road between San Francisco and St. Louis I and Memphis, in less than twenty-five days. ; The service has been as regularly perform ed as it was in former years between Now York and this city. While disclaiming all authority to appro priate money lor Ihe construction ol this ■ road except that derived lrom the war mak- I ing power of tire Constitution, there are im j portant collateral considerations urging us to ! undertake the work as speedily as possible j The first and most momentous ol these is, that snch a road would be a powerful bond I of union between lire States east and west |of the Hoeky Mountains. This is so self evident as to require no illustration, i Hut again, in a commercial point of view, | I consider this the great question ot the day. With llreeasternfrontol our Republicstretch | ing along the Atlantic, and its western front along tire Pacific, if all the parts should bo ! united by a sale, easy, and rapid intercom i munication, we must necessarily command a very large proportion of trade both of | Kuropc and Asia. i Our recent treaties with China and Japan i will open these rich and populous empires to our commerce; and the history of the ; world proves that the nation which has gain ed possession of the trade with Kastern Asia has always become wealthy and powerful The peculiar geographical position of Cali fornia and our Pucifie possession invites American capital and enterprise into this fruitful field. To reap the rich harvest, however, it is an indispensable prerequisite that we shall first have a railroad to convey and circulate its products throughout every portion ol the Union. Besides, such a rail road through our temperate latitude, which would not be impeded by the frosts and snows of winter, nor by the tropical beat of summer, would attract to itself much of the travel and the trade of all nations passing between Europe and Asia. On the 21st of August last, Lieut. J. N- Maffit, of the United Mutes brig Dolphin, captured the slaver "Echo," [formerly the Putnam, ol New Orleans,] near Key Vsfde, on the coast of Cuba, w:tu more than three hundred African negroes on board. The prize, under the command of Lieut. Brad ford, of the Unhed States navy, artired at Charleston on the 22nd ol August, wlitn the negroes, three hundred and six in.number, were delivered iuto the custody of the United Stales marshall for the district of South Car olina. They were first placed iu Castle Pickney, and afterwards ir. Fort Suinpter, for , sale-keeping, and were detained there until , the 19th September, when the survivors, Mo , /hundred and seventy one in number, wtero , delivered on board the United States steam er Niagara, to be transported to the coho-l of ■ Africa, uuder the charge of the agent of the : '-i...... &*■ r United State". person' I to the provisions of the act of the 3d Marcti, 1849. "in addition to the acta prohibiting the slave trade. Under the second section ol this art, the President is "authorized to make such regu lations and arrangements as he may deem expedient lor Ihe safe keeping, support, and removal buyonil tlie limits of the United Slates, of all snch negroes, rniilaloea or persons ol color" captured by vessels of the United Slates, as may be delivered to the marshall of the distritt into-which they are brought ; "and to appoinf a proper person or persons residing upon the roast of Africa, as agent or agents lor receiving die negroes, mulatnes, or persons ofcnlor, delivered Irotn on board vessels seized in the prosecution of the slave trade by commanders of the United Slates armed vessels. A doubt immediately arose as to the true construction as to this act. it is quite clear from its terms that the President was au thorized to provide ' for the safe keeping, and removal" of these negrces up till the tunc of their delivery to the agent on the coast of Africa; but no express provision ' was made for their protection and support after they had reached the place of their destiiiaiinn. Still, ar, agent was to be ap pointed to receive them in Africa ; and it could not have been supposed lhat Congress intended bo should deseit ihem at the mo ment they were received and turn them loose on that inhospitable coast to perish for want of food, or lo become aniu the vic tims of the slave trade. Had this been the intention ol Congress, the employment of an agent to receive litem who is required to reside on ihe coast, was unnecessary, and they might have been landed by out vess. els anywhere ill Africa and left exposed to Ihe sufferings and the late which would certainly await them. Mr. Monroe, in ins special message of lite 17ih of December, 1819, at the first session after the act was passed, announced lo Con gross what in his opinion, was its (rue con struction. He believed it to be his duty | under it lo follow these unfortunates into I Alrica, und make provision for them there | until they should be able to provide for : themselves. In communicating this inter pretation of the act of Congress, lie staled | that some doubt had been entertained as in ! its true intent and meaning, arid he sub-nit ' led Ihe question tolliem, so that they might, | "should it bo deemed uilvisable amend (lie j same belore lutther proceedings are had I under it." | Nothing was done by Congress to explain l the act, and Mr. Monroe proceeded to carry j it into execution according to his own inter ; pretation. This, then became the prae.tical construction. When, the Atricans f.orr. on I board the Echo were delivered to the mar— | shal at Charlestown it became my duty to consider what disposition ought to be made Jof them under the law. For many reasons j it was expedient to remove ihem lrom that j locality as speedily as possible. Although l tho conduct of the authorities and citizens j of Charleston, in giving countenance lo Ihe i execution of the law, was just what might j have been expected lrom their high charac ter, yet a prolonged continuance of threo hundred Africans in Ihe immediate vicinity j of that oily could not have failed to become j a source of great inconvenience and anxiety |lo its inhabitants Where to send them was Ihe question. There was no portion of the ! ooast of Africa to which thpy could be rc- J moved with any regard to humanity, except to Liberia. | Under these circumstances, an agreement ! was entered into with the Colonizaiion i Society on Hie 7th of September last, a copy |of which is herewith transmitted, under ! which the society engaged, for the consider ation of forty five thousand dollars, to receive ! these Africans in Liberia from Ihe agent of the United Slates, and furnish Ihem, during i the period of one year tfterealler, with enm j forlahle shelter, clothing, provisions, ami ; medical attendance, causing the children to j receive schooling ; and all, whether children { or adults, to be instructed in the arts of civ j tlized life suitable to their condition. I This aggregate of forty-five thousand j dollars was ba.-e l upon ar- allowance of one ' hundred and filly dollars for each individual j and as there Ins been considerable moduli j among them, and may be more beforo they reach Africa, the society have agreed, in an equitable spirit, to make such a de duction lrom tlio amount as, under (he cir cumstances may uppear just and reasonable. This cannot be fixed until we shall a-ceriai.r the actual number winch may become a charge to the society. It was also distinctly agreed lhat under no ! circumstances shall this Government be c.il { led upon for any additional expenses, j The agents of the society manifested a laudable desire to conform to the wishes of the Government throughout the transaction. They assuied me that after a careful calcu lation lliey would be required lo expend Ihe sum of one hundred and filly dollars on each individual in complying with Ihe agree ment, and they would have nothing left to remunerate liiem for. their care, trouble and responsibility. At all even's I could make no better arrangement, and there was no other alternative. During the period when the Government itself, through its own agents undertook the task of providing lor the captured negroes iu Alrica, the cost per head was very much greater. There having been no outstanding appro priation applicable lo this purpose, I could not advance any money on the agreement. 1 therefore recommend thai an appropriation may be made of the amount necessary lo carry it into effect. Other captures of a similar character may, and probably will he made by our neval forces; and I earnestly recommend that Congress may amend the second section of the act of March 3, 1819, so as lo free its \ construction from die ambiguity which has so long existed and render llifcdulyof the I President plain ill executing iis provisions. 1 recommend In your favorable regard the looal inlerests of the Districts of Columbia. As the residence of Congress and tire exe , entice (lepanrnent of the Government, we , cannot fail lo feel a deep concern in its wel fare. This is heightened by the high char- I -ncter and the peaceful ana orderly conduct of its resident inhabitants. 1 cannot connlude without performing the , agreeable duty of expressing my gratifica , lion lhat Congress so kindly responded to I the recommendation of my last annual ! message by affording me sufficient lime be fore the close of their late session (for mo examination of all the bills preseritedtn me for approval. This change in the pfpctice of Congress has proved lo be a reform. It exerted a beneficial itiffnenee on ihe transaction of legislative justness and elicited the genera! approbation of the coun y. It enabled Congress to adjourn with that dignity and deliberation so becoming to the representatives of this 'great Republic, without having crowded Into general appro priation bills provisions foreign to their na ture and of doublftj} constitutionality and expediency. Let mo warmly and strongly coinmer.d thia precedent established by themselves as n guide, lo their proceedings during the present session. JAMES BUCHANAN. WssmlNtiTON CITV, December fi, 1858. jTlook at this. gVKT.L those that have s'anding account with b ** the firm ol Mendenhall & Mench, and '; with 'to subscriber, are hereby notified that unless payment is made by the 15th of Jan uary next cost w ill be added. lam in euru est tills time, so gentlemen, come toe tho mark. A. C. MENSCH ' Blonmßburg, Dec. I, 1858.—3 i.
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