. .=..
•
r
..,
.:.
1-.7,7'..* - ---z , ... P• 7;.•
14.- —,. - -- - .., 7,,,
, 1- I
~,,
7 ,
1-,:17-77 - 7'lE.,
•:i : 1. I
-- - ‘• -t k: , ' e. , - -
s._ •,. 4 7.27 -:
:1 101.
. gao l -th
' ' 0 0. 1 F 4414
•
I : • Ikti
. 5 .77 4 th i
..;-', • metio
1 lirtatlii
1 *tifi
• • '.744 . 71 - %
1 . ';•-**
, 4; 1
-4::
..,•.•.
• 1 ,-if ..
.- •!•'..t.,!-:••
. - In.lii
- • ~,,,J....•.
• -...,•.:••••,
.„.._
••,,
„Irons mai namerns.
'thellematnel . of the Trea.
ifrohiessege, of - the Preat
Iniinet ant Oen:Merit which
oftenging ddla forth. Evan
;reports '.the War and
Oa eat hardly be said to
keitr.for both imsties and
dtri- soid depend ipon, the
reimitt of long experience,
coilicet of • thomorld's his-
CU embodied in the cam
- e as sinew Vicar!"
patpi hamito raise the money,
hal Wbiehit may be done with
iiI4SIIITECI*IICI i IlltS allays deeply
* them
Idleettindon to .
Oilittb7cets °
ItOpteirMnee of this muting
atowardship, which the &ora
l:be treasnry renders to the nation.
r s eaenOtif the report, which ocen
'deige*pert Yin of our spare to-day,
lgits from entering into any exam.
ONO . rtMerateendations, with regard
. ,
:14.Ajtifi**4 the on certain commod
in!'Jlchuni zaanuftictsuring friends
11* -4443*id, Such ai distilled liquors,
litiAiltalt;Utc. These, howtmer, wi7lbpesd
li ettrapt the attention , call fbrth the
pirtioloof the business
•
:•; .1.13/190 of theiSeeretat7 of the
Treas,u l7 .
!',f.-In: , ;s4mootA:ig to consideration of
on the_state of the finan-
of :late by law at the cam
t-
each ender', the Secretary
attho Treat , nil heti:much satisfaction in
bityg arils to say; 'in general, that the op
-4.nc the department entrusted to hie
hiorebeen'attended, during the last
itinifitiiti,hy a greater measure of success
than 'iii.'ittaitnzed to anticipate at its begin
rrg' 01 LU? MC" TKLIL
• , .11, ,
' 1 ' •'
' "l9 . ' ''.
. had indeed been
iniireir ' 612 - 0° ..• remained.. A
.':-.',..' m0,,,/6„ona.--- - and - • . .of $18,048,-
, h - i .. .....,:z_.,,i , ot the, Ttewurer non
balance
,',:.10,110,77iitit the inzie disbursem ents.
._
' t- 15 0 3 :'- 81 1 , '' •, • - e4L-hy military d natal
a wi
can
s -Naga ''
' „ -„, a ed;' by compar ison, t
i'4,•-= no ' bane , to al mos t
______ e _. . -,,,emoderablo, d th e pm,
~._.....11n.. IliitaiY,Prol°44°P!' An d
Prmis
,, ~•.:_innoto.
~ • n„.. o t , , the restri ctive
no_ti,
, :Aiikr operations authorising th.
'.'"'''ll)lo;l4'biadt. kn°7lt a, - five - twenties. i already
acts no
:41*31"4;ii lion
"jito" nation: for
viellund,„,,
tilt iteeleinawl,____ll..t. me terms
°64Prkt amounts i n id on mime... which be.
00$ Wpssetab ".- . . reverses
in
»gz.4tinajfj Terini:l.,llMon or liiiiituntinsoiti:l
~7*-.- / .iiri*.d ,' , # . 4) - Ms' Secretary was
large
itr..,,:thati'l= kotintionia p rov ide, than
,21Pieri' • ' r int,4,l,4— on iL , first
~.....,_-tiftlitir,,pics,;."B , un p a id, on ~ ..
. y 1, ; ,. ~ ....e setem, r,..—•• ';remained ;:..¢ eeeneartily.
congrus, reqtual
7,-,,5'.....,--,,, 'tat end9ri of the War
~,, -tay,'Of O. --, ' eblo7 ham in the
'-',,,' - , eitthetreldraty l , amounting
''''''4l4l3l 'DaP:43/4lnts' 875 80.
4 aii4PfTy-_, = (44546,89.
..
la:thegU e'rettliili ors end
offor
''._"•,'..,:::.:.: : •,prO:idafor: -
demands,.. Congress , - on the 1 Atli
car17'4: ' , ,1858, 4:dhoti:ad an ' additiona l minof
'l'lizil47l7latea.Stawni-9testf'tie but didnot
;cue hun d red
to
•":7,,,7:....,-, -- tit conchnuonl i !:__
. 0 , be _
.4F2.-.l . goatkiPT_ - • toetnbOdY 011ulm - closed.
1i the session
_ act to
fk•;:-.1,,,,fpitii-aity-;,zoiti,3,g8610' ;p ar t of
`‘.,:,A2:--91,146-aanya seil,lneall : r the ,pprOTAI ?f
'- .. 3?, ,Cl,, toi l era P it j t , ,, :2 7: s4 - 6 law. iti_ad eo t .
*:,ukris)tit,„,:vir,#l. o-.. t r f. l-;', .. i., trl i : -,
i.5.1,,,,„1.4,441;i1et " = g n t , the 6 '
..::..
:'"lr'.7l,H-- —ail'A4T*ltHftbt4'iuPg°'*sttillagC4':!'Atst 1 7:••,. - ;-: .-.-- "T,i .
14i11462.4
- ALIT" earlier, on ate 25th of. February,
k'' t Snieri even; mote important to the credit
K Atthir government—the act to provide a
V - tadl9l4 currency thrugh a national Ma
n- -thir atom-had received the sanction of
*goes and the President. The salutary
effects tit these two great acts were soon
eons
lotwithstaaing the aid afforded by the
..-
additional Issue of re l United States notes,
'''' ander the joint Mien of January, the
:had fo it imp o ssible to pre.
r... want i gnulualinerema during the session
..-..,-Ofiltisilaali in the amount of unpaid re
"Ly quillitions.: Thom which were unsatisfied
:. 441hotheeening of-the email= were indeed
lllisedterged, and bergs gams were applied to
,
,- new dentionis' for : current disbursements.
, Butemeggregate ot distorreements,rernain
';` big neemetarity unpaid, increased steadily,
'.surtaithstending ill efforts to prevent it,
l4'
0
until it ruched, at the don of the suasion,
kl' - aelinanof $74,121,189 41.
The loast act and the national banking
C. lta Were followed by ea immediste revival
:,.,i. ,r of puha:re:edit. Success quite beyond an
"l tlaPidiett enewaed the efforts of the Socre-
IT- !My Ile distribute the tims.twenty loan its
„..- on pow of the moot:7; as well as -awry
a....,
other mesa= adopted by him for repten
-tailing the treasury. The result was that
r 1 . , -- erithth two months after ~the adjournment
etVagrant ihe whole roue of suspended
s z ;! , )requisitlear hod bees satisfied, all current
,!,,„ the:Masi promptly met, and full provision
x- ..fatede lb? the.pay of the anny and navy.
t; : : paring the - romainder of the Iml•
. year no
-.'. matiessemnenteattindedtheadralrustration
iet la Arum= except those which are in
fromi Tag expenditares. Not
battidit these expenditures it is grat
'i...4 Adak to;be able to stste that during the
t\ /Miner the total or dloburistments did not
, =meted, while the increase of the
debt (RAMA eqtal,th° estimates sub.
mitittatieedgreasby the ihs:lretrtry , l ath e l a m,
) - - ,- ....elaeliett• Thus, while It was than -anima-
ON . Q , ' , tad *Mao Public debt on the soth ofJune,
C, 186% . - 4 7111 reach the sum of-$1,122,297,-
*-4011 , it
s actual amount on that day w
. . 4 ..t , VAS. 4181 87 ; , ' and while the disburse-
Atil for tut year were Itsbnatel at &398,-
t .. itifcit2t 48 0 ,11E54e5'; total -was $714,709;
t..005GM - 1 - -',-,. - ---='''
1 v
'eli l The aggregate reeeipts froze all sources,
,' , 414veteg the Wane* ,from the preceding
yog i MAMA by thebooks of the Memory,
.;•,_', doriegltil liMt fiscal year, $901,125,-
m
2,674 sad the aggregate disbursements
10 + 6BQ - OS ; learinga Wince on the
Opted nee, 1E53, 0f.56,829,044 21. , Dot
- salmi borrowed 'during the year, and rip
, tiring 1114 same time in payment of
aro:tow nominally the total of to-
MA
4 , Or dbibuneratata. -The sums
,tittialiMalred and applied during the last.
P 1, 1 1. 1 1,_ 1 _ t
Legate, Year Amounted to $181,0813,036 07.
l'A°4• iitecerefo, should - be de
4aPiitltrac!" bah OldeS of ato,Matement,
' , sat of receipts, fueled
'‘el Year,-$720,089,-
vent of disbars°.
The balance, of
ES
BE
. ,
-1 ,
_;;,
‘ t 1 :1 4 4
'IV
MEM
. .
• ' I A -4 -1 - WlV:it'•%l ,, f+) ,- "" 4 •?' , 14 - _,Pi.'-ft-T.ZWT - •• - ---. •
- 4 - -
Ith
„....„ .__,
...7.7,,.,,,,,.
. 1 , „ ...., .:,
”
~,:• i.,., , •
'rra; rater theinstiectioes of {be Com.?
talitslortee Mate huttatioeef the Secretary
a veil. compeSeatleetleosits wactor some
time employed lit aocertainialg, with the aid
of practical men, conversant with business,
the probable amount of revenue from each
object of taxation. The result pf hie in
.(ll4fitti wax the estimate which, sanctioned
'by the Coiamissioner, was believed to be
cornet by the Becretaity, and therefore sub
mitted to Congress.
Experience, hes demonstrated its error.
The estimate was $133,456,303 73, while the
actual receipts were $37,640,787 95. A
part of the deficiency may be attributed to
the imperfect execution of the law, and a
parfto the changes made in it by Congress
after the estimate wee made; but it is not
probable, had neither cause operated to re
duce receipts, that the revenue from this
source would have exceeded half the esti
mated amount. It is clear that the law, un
less materially amended, will not produce
the revenue expected from it.
The whole of the receipts and disburse
ments for the last fiscal year may be more
easily nuderetood from a somewhat more
formal statement,
1146#1
The receipts, estimated and actual, then,
for the last fiscal year, ending on the 30th
of June, 1863, were, including balance from
the preceding year, as follows:
I?=
From taltealatacons-.. 2,244,310 11 3,049,816 15
from direct tax-- 11,C47,17 99 *1,415,103 GI
From interaalrereaue. 85,456,3191 T 1 37,940,787 95
Balacwa from tut year.. 13.041,549 81 13,041,546 131
Total receipts from all
Ordinary mugs. 180,415,345 en) 1124,443,313 29
*See on lot page explanation of difference between
the apparent receipt and the actual, which nearly or
quite equalled the estimate.
The additional sums, sett:oil or estimated,
necessary to meet disbursements, were, of
course, derived, or estimated as derivable,
from loans.
The disbursements, estimated and actual
were as follows:
Fatbnated. Actual.
The Ctrel Berolco.-.... 633,811,543 23 623,253,92.1 08,
Rondo= and lupus. 5,982,900 43 4,216,520 79
War DopartanouL-.... 747,359,678 08 592,08,660 81
Navy Dopartroont..— 82,177,510 77 03,211,105 27
Lutanist on dobt..- ..... 25.014,1533 OT 24,729,846 61
Total gross estimate. 893340,T21 48 714,709,995 58
But thlsamount,it waa
aappossa, would re- -
maln
undrawu at
•
and of year, and was
therefore deducted
from the gross
200,000 000 02
Making actual tatimata.C.l3,346,=l 48
Itt his last report the Secretary stated
that If the appropriations should equal the
estimates, the balance unexpended at the
end of the year would probably reach
$200,000,000, and that this sum should
therefore be deducted from the departmental
estimates, to make the aggregate correspond
will probable conditions. The shore state
ment shows that the aggregate of estimates,
thus reduced, was $693,346,321 48, while
the expenditures were $714,709,995 58,
exceeding the reduced estimates $21,363,-
674 10.
From the actual expenditures, $714,709,-
995 58, there must be deducted the actual
receipts, $124,443,313 29, in order to show
the amount derived from loans, $590,260,-
682 29, which sum, added to the amount of
the debt on the let July, 1862, $508,326,-
499 08, (heretofore erroneously stated at
$514,211,371 92,) gives as the true amount
of debt on the Ist July, 1863, $1,098,793,-
181 37.
The estimates for the current fiscal year
1864 next claim attention. These are
founded on actual receipts and disburse
ments for the first quarter, which ended
September 30, 1863, and on opinions formed
upon probable events and conditions as to
other quarters.
The following statement exhibits what is
actually known and what, after careful re
flection, the Secretary thinks himself war
ranted in regarding as probable:
For the first quarter, ending September
30, 186:, the actual receipts were :
From enstoms...--- 34 53 4 0 / 8
From lorernal rovertoo. 17,571,713 71
From 134181 OS
Flom mincers sources— 641,612 01
Tots.' aettiitlreceipta fur
•rter i —...-- c .. 10,039.456 11
be able to state,
reach the stoonnt
Erect all sources of
:meaner exeeeded
-retisipte from ens
-
041,786. were
lands, esti
lrere' $1671.07 17
s aur c es, estinia
$8,010,815,: 85, I&
eiticuttedet 4 /; 621 V
;or neatly this
formof
ipplieaaud
41.14/1 they 'are " ti "
their -several PnVer"
xrdosigt - mai, - however,
tram of
Allesoo/4 as rs
,:iJ4o4ry itt i
t i n i him
;:fie tietl-
lereltteldfott Of
'4014t1 been ,
1414-4141
'
'
:~S.n~"
Estlmnted. Actusl.
E 63,041,730 14.1 569,M9,612 40
88,724 16 167,617 17
larrimAtts vast 1864
• rig total resell:as of Orin quarter,
rer three remaining qurtins,:ted•
the month of Jane
It
la ortimated there will be itosired
From rusteme..- $50.010,000 0 3
Fran Internal num= co,ooo,ona lu
From lands stxkom LV
•
gragtrell 5,003,(0) CO
Halting a total of rr.relpta from ordi
nary warms, sal:oda:ad atimated,
and Including balsam, Of—. —8 10,568.500 33
To which add l b . actual and eattrua.
k.lreCelm from kams—...—.
Making a total of actual sad erilma
ted receipts from all sermon for
185 - 5 rooes,6oo 35
The expendirunse easy be detects.
For„tbes.•fiest quarter, ending September 30, ISO
the seassi disbursement. have Gem
For the Civil Sersiee—S 7.216,930 31
For Pemba.. and I.
dians ........ _...---. 1,711,211 ie. A
For War Department_ 144,387,473 27
For Navy Departmont=lB,sll,Blo 12/2
For interest an Public
Debt 4.2a3,2.2t 27
Actoal expenditure for first q0arter,..1176,110,1n2 on
For the turealning three qoartere
the estimate, foundation appropria
tions and estimated attendee, are
as follows:
Far the Clan Service...l 27;15 , 0,072 II
For Pinions and la
dle. 0,021,012 80
For War Department. 741,092,807 14
For Navy Department 04,407,547 74
For Interest on public
debt
CUE=
Disking a total aggregate of actual
and eettmatad expenditures 0f..1...51.0%),731,9 , 41 4'
But u thee° estlmatat laclude all oo•
expended balanced of sppropris-
tlona from former years, they are
merman) , much too larga, and
there may be safely deducted from
their aggregate., vs !hely to rentals
enerxpended at the dam of the de
al year. the sum of 950.0430,000
Leastorttra total actual expeudithre
for r 42,731,000
The tonal' expenditures being deduct
ed from the total of reinnita, than,
will ban animated balance on the
both of June IBM,
From Mb statement it appear. that
the total •oomityte regidoed for the=
probable disboraenomla of the year
and Inelndlog animated balance at
Ito data, will amount to ---- $755,663,503 35
Of ',bleb there bar. boon prvoldod
and applied dating Ow fl .t guar=
ter—
-176,110,5 T/ 4a
Leaving to be g.,79,4gfA57 O)
Os which It to estimated there willies •
remised from ordinary eoarees dog:
tag the three other quarters 4 . 115,300,000 00
Leaving lot to to providut by loom T.1C4;167,547 89
The amount or debt created during the
quarter is •asourtained by deducting from
the total expenditures $170,110,932 46, the
aggregate of ordinary receipts and balance
from last year, amounting tqgether to $46,.
268,500 85, which gives as the increase
of debt $129,842,482 11. To this sum, if
there be added the sum yet to bo provided
by 10an5,5464,167,667 89, the result will
be $594,00,000, from which if there bo de
ducted the estimated balance on the first of
July. 1864, $5,836,689 98, the remainder
wufbe $588,168,460 07,15nd will represent
the total increase, on the bails of these es
timates, of public debt during the year.
The debt on the Ist of July, 1863, Was $ 7 ,-
098,793,181 87; to which if this estimated
Increase bendded the total debten the first
of July, 1801, will be 81,686,956,641 Win
stead of $1,744,686,686 80, as estimated in
the report of last December.
It is not certain, or perhaps probable,
that the actual-expenditures or actual debt,
:will quite reach the amounts now tams-
Lted. Indeed, if theexpenditures for the first
quarter, $176,110„982 40, and the ordinary
receipts, $40,989,466 14 for the same quar
ter, be taken as the standard, the total ex
penditures of the year will be5701,443;729;-
84, and the total receipts $163,7,7;8.' 1 4'60.
To these recelptkif the balance on the Ist
Of July, 1868, $6,829,044'21 be added,_it
will make tho , total ordinary ' resources
169,080,868,.77; and the subtraction of
suuS;frent the total eipenditurie will
the whole amount to be provided by
Jeans daring the year as F 0 , 860,881,
, This sem will therelbrit be, on this hy
pothals. awfu:reale or debt - tor the yori
and, added the debt existing t& lid
1n1y,1868, will MOO the total amount en
the 80th °Clung, 1864, $1,634,164012:44.
•.•;. 14 is not Imposs ible' that vigor in the
Presetwiltoi,'"erwui>. and economy, lf►
*raj? -bream of erspendtte* enforeettl.y .
wiseligNagoti;;-'._lll*,t7m4tpoixouil'il*
basements and consegrierdAnotom of
debteSren below these *nes; sad eettainlj
few things can be more desirable than so
redactions. ..r
The action necessary to these results, is
not, however, except as to the comparatively
Small expenditures of the Treasury Depirt
meat, within the sphere assigned to the Sec
retary. He therefore prefers to accept the
estimates of the several departments, and
the actual approPriations by Congress based
upon them, deducting only that proportion
which experience has indicated as likely to
remain as balances unexpended at the close
of the year. He thinks, too, that sound
prudence requires adherence to the rule he
prescribed to himself from the first, of over
stating rather than understating the bur
dens created by the war and the demands
thence arising upon the resources of the
country. lie has sought to avoid exagger
ation on both sides, but he has thought it
more prudent to excite a little too much
apprehension than to encourage too san
guine hopes. The real difficulties have been
and are too serious, and the real burdens
too great, not to warrant earnest demands
on all the resolution, all the energy, all the
energy, all the wisdom, and all the economy,
which the strongest representations, sane-
Honed by reason, could or can.bring into
I action.
ESTIMATES Toll 1865
In addition to the estimates for the cur`
rent year just elated, the Secretary is _e
quire(' to submit estimates of the 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.
But the Secretary is encouraged to at
tempt them by the circumstance that the
estimates for the fiscal year, 1864, submit
ted in his report of December, 18112, are less
materially modified than might have been
expected by the actual receipts of one quar
ter, and by the probabilities affecting those
of the other three, and the general result is
more favorable than was anticipated.
•
The aggregate receipts for 1864 were esti
mated in that report at =3,025,000, while
the actual receipts, other than from loans
for the first quarter, and the aggregate of
expected like receipts for the remaining
quarters, are now stated at only $161,568,-
500.35, in consequence of the large defi
ciency in the receipts of internal revenue.
On the other hand, the aggregate expendi
tures were estimated last year at 8845.413,-
183.56, and are now estimated, on the basis
of actual returns for part and estimates for
the remainder of the year, at $755,568,-
500.35. The subtraction of receipts from
expenditures show the amount now esti
mated as required from loans for the year
1864 to be $554,000,000, instead of $622,-
388,183.56 as heretofore estimated. These
figures show that the estimate of expendi
tures is now $36,844,683.21 less than the
estimate of last year; so that, although the
ordinary receipts as now estimate.] will be
$61,4:".6,490.45 less than was anticipated o
year ago, still the increase of debt will be
8,28,368,183.56 less by the present than by
the former estimate, which, it should be re
membered, assumed the debt, on July 1,
186:1, at $1,122,2.97,40.1.24, whereas, in fact,
it only reached, at that date, the stun of
$1,098.793, I
W ith these iHu.strations of the uncertainty
of estimates for a year which Is to commence
more than six months after the making of
them, and without professing any sanguine
expectations that the estimates now to be
submitted will, when tested by experience,
prove, like the last, less favorable to the
country than the actual results of adminis
tration, the Secretary submits the required
statement for the fiscal year ISIIS, founded
on the estimates of their probable require
ments furnished by the several departments,
and on what seem to him probabilities con
cerning receipts from ordinary sources of
revenue.
lie estimates the probable receipts as
follows:
Estiroute.l balance, July I, IBA
From m.uttoms 711,000.1.11111.110
From Internal mwettue
1221221
Frt. miscellancow wart.
Making mtlmated sonvstemr_lpt3..D.l,W3/:,53.9.93
And he estimates the expenditures as
follows:
Le/boated balance of former approprb
talons unexpended, July 1, 160 531,Olfb1Kal.tu
For the dell err-rice
• . . .... .
For Pensions sod Indians .......s. 9,ati.4.7a
For the War Department ' , A.4ivvt.1 . Y7•77
Yor the Navy Departrasut . ..- 142,.15,7NN.40
For Intermit ou public debt ._-_. ..... ... FiIiIN7•TFI3/5
Making the aiwregrite of estimeted ex
.............
Hut be atLcustes as likely to remain
endreven on the .311th Juno, 11141 S, and
therefore to be deducted from this
aggregate 400.Q10,1/00.0J1
115,9X.,M 00
■.king the mat °etiolate of expend'.
turn for the pox . $761,8111,083.an
From which dedort animated mcalpte
from ordinary sourcee,as beton, stated t9X,0tta,f49.9.3
Leaving to tow prtividni by 10at......4544.978,54.5.1nt
The sum to ho provided by leans repre
sents the increase of debt during the year.
Assuming, therefore; the correctness of the
estimate which puts the debt on the let of
July, 1864, at $1,686,956,641.44, it will re
sult from these estimates that the whole
debt will have reached on the 30th of June,
1865, the sum of $:4231,935,190.37.
It has been already seen that the amount
required for general disbursements, exclu
sive of payments on account of public
debt, for the three last quarters of the cur
rent fiscal year, was, on the Ist of October
last, $579,457,567 89, of which sum, $113,-
300,000 were expected from ordinary sour
ces, and the remainder, 8164,157,367 89,
was expected from loans.
The receipts and expenditures during
October and November, other than on ac
count of principal of debt, amounted each.
so far as has been ascertained, to 8147,060,-
731 19, without balance. Of these receipts,
$35,620,703 18 were from ordinary sources,
and $111,931,027 98 from' loans, either
temporary or permanent, leaving to be ob
tained during the remaining seven months
from ordinary—sources $79,670,206 82, and
from loans, $352,226,689 82. On the basis
of these tw months, the receipts and ex
penditures from ordinary sources for the
last three quarters of the year will respec
tively exceed the general estimates by $43,-
038,694 31, and 89,532,257 72, making a
difference In favor of the country of $3,-
501,409 59.
I=l3
The Secretory admits, thereforv'no ap
prehension of deficiency on comparison
with estimates, in any of the ordinary sour
ces of income, except, perhaps, the internal
revenuer, nor does he anticipate any formid
able difficulty in providing the amount to
be obtained from loan, especially It the
successes •ouch sated by a gracious Provi
dence to our armies during the last nine
months shall continue to attend them.
Bat no one can be more profoundly con
vinced than himself of the very great im
portance of providingeven a larger amount
than is estimated from revenue. To chock
the increase of debt must be, in our circum
stances, a prominent object of patriotic
solicitude. The Secretary, therefore, while
submitting estimates which require largo
loons, and while he thinks it not very diffi
cult to negotiate them, feels himself bound
by a prudent regard to pogaible contingen
cies, to urge on Congress efficient measures
for the increase of revenue.
WAYS MID 1ff..i.141--MODIFICATION OF DUTIES
It is possible that a limited additional
amount of Income may be derived from
Judicious modification of some provisions
of the laws Imposing duties on foreign im
ports; but the chief reliance for any sub
stantial increase, and even for the preven
tion of possible decrease, must be on inter
nal duties.
The Commissioner of Internal Revenue
recommends an increase of the tax on bank
note 'circulation to two and two-fifths per
cent an increase of the duty on distilled
spirits to sixty cents porgalion; auburn:me
of the duty on tobacco to tWenty cents per
pound on leaf, and tram nee to twelve cents
according to quality, on manufacturid; a
duty of ten cents per gallon on crude pe
tioleum; a duty of two cents per pound on
cotton; the repeal of the tobacco and petro
leum drawback's, and miens other changes
of the Internal revenue'laws, designed to
augment the receipts 'from this source. In
the particular reoommendstions just Men
tioned theSer.retar7 folly concurs, and,
comniernbi ill his suggestions toearefulat
'The enactment of , each laws. tie
wilreeente .
tier - ease of the . internal
revenue to the amonsteriginelly
of one 6i:m*6d and MY. tenon ti - yeet., is
bs thisir4W.O...'o3lddsTo4o4 of
olio Ifs
'••
.5:,• , '"X.01!1.""•1if' ..-, `': •
• IlitatitOdOf expenses of the wer +re.
been defrayed t.y_ to.*eiteitt
_
-
'l' •
nothinibut the eiPeccition'ef its speedy
ternination could 1541Y:warrant.
In hiii . fuet report, submitted et the spe
cial session in July, 1861, the Secretary
stated his conviction that, to a sound finan
cial condition, a system of taxation certain
to produce a sufficient revenue to pay.the
whole ordinary expenses of the government
in times of peace, and the entireinterest on
the public debt, and to create a gradually
increasing fund for the redemption of its
principal, was indispensable. IL wax not
important, so long as it seemed highly pro-
bable that the war would be speedily
brought to a successful close, that the re
venue should largely exceed the ordinary
expenditures and the interest. On the con
trary, it seemed wisest to obtain the means
for nearly the whole of the extraordinary
expenditures by loans, and thus avoid the
necessity of any considerable increase of
the burdens of the people at a time when
.the sudden outbreak of flagitious rebellion
had deranged their business, and tempo
rarily diminished their incomes.
'rhe financial administration of the first
fiscal year after the outbreak of the rebel
lion was conducted upon these ideas. The
sots of Congress at the extra session of
July, 1861, were framed with the intention
of supplying the full amount of revenue
demanded by them. But receipts disap
pointed expectation, _and it soon became
obvious that a much larger proportion of
the means needed for the fiscal year 1862,
than the principle adopted would allow,
must be derived from loans.
When, therefore, Congress assembled in
regular session on the first Monday of De,
cember, 1801, the Secretary directed atten
tion to the necessity of increased taxation.
The responsibility was promptly assumed
by Congress and the internal - revenue law
wits enacted, and such modifications of the
tariff act were made that ample provision
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
sults of the then current year. Nor did
it affect them. The total receipts from
ordinary sources to the close of that year,
June 80, 1802, were insufficient for the pay
ments expected to be made from them.
The receipts were $51,935,720 70, while
the disbursements for the civil service,
for Pensions and Indians, and for interest,
were $57,71.11,8/1 11 ; leaving only $14,-
233.1119 05 for the War and Navy Depart
ments, the expenditures of which in the last
year of pence had been $27,922,917 24, and
nothing at all for extraordinary expendi
tures of a sinking fund.
In his report at the December session,
IStl2, the Secretary, considering this defi
ciency and assuming the correctness of the
estimate of 5130.000.000 as the amount of re
ceipts from internal duties, and taking
double the expenses of the War and Navy
Departments in the last year of peace, as
the amount likely to be annually required
after the suppression of the rebellion. ex
pressed the opinion that the probable re
ceipts under the legislation of the preceding
session would meet all ordinary expendi
tures for the fiscal year 1963, and interest,
and leave a large surplus to be applied, for
the present, to the extraordinary disburse
ments of the war, or, after its close, to the
reduction of debt. In that report, therefore,
and in his subsequent communications to
the proper committees, the Secretary sug
gested no increase of taxation, but confined
his recommendations to other measures for
the improvement of the public credit, among
which those. relating to loans and to uni
formity of currency hellthe foremost plate.
Congress gave effect to these recommen
dations by the loan act and the national
banking act, but at the same time somewhat
diminished the expectation of income by
modifications of the internal revenue act.
Notwithstanding this diminution, how
ever. and notwithstanding the much larger
diminution caused by the failure of receipts
expected from Internal duties unaffected by
this legislation, the Secretary has now the
satisfaction of being able to show that the
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 extra
ordinary expenditures which, under the
circumstances, was equivalent ton payment
into a sinking fund
IMICEEI
D=CEI
5,003,000,0
Thus the total amount of rtavii.ta
dating the ()seal year 1,3 ..
Whit.. cupundll arc. vrerc
roc Mc rl.n gcrvicc *JO rut l'cu
and Indians $ . 27.170.411
For int..men
And Iroold lur« Iron far ordlnary
diriborownromtr of War uul ry
Urpartmentr, ndlniat,tl nt dontl«
ht but r of 1000 .",,,F45,834 48
Leaving dtfterotaca lo.tween rneipta
and ordinary expendtturra arplica.
Erie to ratraAirdlnary capniditum.
t==
Ilea it been possible, therefore, to s up
press rebellion and restore expenditures to
a peace basis after one year of war, and
before the Ist of July, 186'2, there would
have been a balance on the Ist of July,
1863, of more than sixteen millions of dol
lars applicable to the reduction of debt.
So, assuming as correct the estimates of
receipts rind disbursements for the esrrent
year 18d4, based on actual receipts and ex
penditures of one quarter, nod making the
total amount of receipts $10,.568,r00 ;15,
and taking the disbursements for the Ci•il
Service, Pensions, and Indians, to be $4:2,-
108,126 :13. for interest, $59, 165, 1..", G :18,
and for the ordinary expenses of the army
and navy, as before, to be double those of
the last year of peace, or 556,845.8t14 48,
and deducting the total of these disburse
ments, $157,119,1817 19, from the total of
receipts, and there will remain an ones
pended balance of $4,049,403 16. it
been possible to suppress rebellion after two
years of war, and before July, 1t . t6:1, this
sum would have been applicable to the pur
poses of a sinking fund.
So, also, assuming again as correct the
general estimates of receipts and expendi
tures for the next fiscaLyear,lB6s, the total
receipts for the year will be5206,836,a5 53;
while the expenditures for the Civil Ser.
vice, and Pensions and Indians, will be
$17,644,405 54; for intere5t,565,387,676 IS;
and for the army and navy, observing the
rule already stated, $55,845,834 48, making
a total of 5178,836,010 17, which sum, if
deducted from the total of receipts, will
given remainder of 27,998,529 76. Should
the rebellion be suppressed after three years
of war, and before the first of July, 1864,
that remainder will be applicable to pay
ment of debt.
M 1213
These statements are subjeetto some mod
ifications besides those which may result
from errors of estimates; but these cannot
reduce, though they may increase, the 4-
plicable balances, and therefore cannot
affect unfavorably any deductions from the
figures which hare been given.
These statements illustrate the great Ito
portanco of providing, beyond all contin
gency, for ordinary expenditures and In
terest on debt, and 2r the largest possible
amount of extraordinary expenditures, by
,'taxation. In proportion to the amount
raised above the necessary sums for ordi
nary demands will be the dimunition of
debt, the dimunition of interest, and the
improvement of credit. It is hardly...We
Much—perhaps hardly enough—to say that
every dollar raised for extraordinary ex
penditures or reduction of debt Is worth
two in the increased value of national secs
, titles, and increased facilities for the nego
tiation of indispensable loans.
These statements illustrate equally the
importance of an economical and vigorous
prosecution of the war. No prudent man
will recommend . economy at the expense of
efficiency. Such nominal economy is 'real
extravagance. But efficiency is not .pro-
meted by Trofusion, or waste, and least of
all, by misuse of public money or public
property. Every dollar and every max are
'freely offered by a generous people; how
sacred the obligation that not one , ntan
should be wasted, and not one dollar mis
applied. Nor is rashness, in war, Vigor.
But the vigilance that misses no opperrtu-
Idly, the energy that relaxes no effort, the
skill that vitantea all resources, , 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.lst ofJuly next; thenorm-
Vry will be saved frptii . the 'TOIL inert:too of
debt which must necessarily: ttend its con
tinuance durintanother year, pad tint debt
itself can at once be placed in course 'of
steadynedection.'And whenever. ptbgreq -
Aye
,payment shall ,begin, the;:?slue :of
nistionalsonuithit- will rapidly: I*, and
redaction In rites alibi - rest will_igniduallp
Atuelnishtheburderis et'debt. _
I SP, the 8.01:4W—Thnf..44"41.
tbs4ibelarpedLipoisibie.proportion of ex
pandit/setae provided by direct contribu
tions front the property and incomes of the
people, be is aware that a still larger pro
portion must, as yet, be provided by 10,toS.
THE 54j10NAL EIZEIT---011JECTA KEPT 10 clef
In the creation of debt, by negotiation of
loans or otherwise, the Secretary has kept
four objects steadily in view: (11 moderate
interest: (2: general distribution; (5) future
controllability; and (4: incidental utility.
I.—Towards the accomplishment of the
first object, the nearest approach that seems
possible has been made. The earliest ne
gotiations were at the highest rates of in
terest• for it is a distinguishing character
istic of our financial history in this rebel
lion that the public credit, which was at the
lowest ebb in the months which preceded
its breaking out, has steadily improved in
the midst of the terrible trials it has brought
upon the country. The first loans were ne
gotiated at seven and thirty hundredths per
cent.: the next al seven; the next at sic;
more recently large sums have been ob
tained at five and four: and the whole of the
debt which is represented by United States
notes and fractional currency bears_ of
course, no interest.
The interest on the debt which exists in
the form of treasury notes and certificates
of indebtednessor of deposits, and is called
temporary debt, is paid in United States
notes; while the interest on debt which ex
ists in the form of bonds, and is called
fundedolebt, is paid in coin--.a discrimina
tion which in intended to bring the payments
of coin interest within moderate compass,
and at the same time to offer special in
ducements of investments in bonds, in order
to avoid a too rapid increase of circulating
notes and consequent depreciation.
The avenge rate of interest on the whole
debt, without regard to the varying margin
between coin and notes, was on the first day
of July, 18132, 4.36 per centum; on the first
day of January, 1863, 4,02 per centum: on
the first day of July, 1863, 3.77 per centum:
and on the first day of Octoher, 1667, 3.1. t:)
per centum.
14 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
Interest bearing to the non-interest bearing
debt. And as the amount of the la t ter, con
sisting of United States notesand fractional
currency, cannot be materially augmented
without evil consequences of the most
serious character, the rate of interest must
increase with the debt, and approach con
tinually the highest average. That must
be greater or leas in proportion to the dura
tion and cost of the war.
2.—The general distribution of the debt
into the hands of the greatest possible num
ber of holders has been the second object of
the Secretary in its creation. This has
been accomplished by the universal diffu
sion of United States notes and fractional
currency, by the distribution of certificates
among great numbers of contract creditors
and temporary depositors, and by are
to popularize the loans by giving to
the people everywhere opportunities to sub
scribe for bonds, These subscription ar
rangements have been especially useful and
successfuL They have been adopted us yet
with reference to only two descriptioni of
bonds—the two commonly known as seven
thirties and five-twenties, so named. the
first, from their rates of interest, and the
second from their periods of payment. The
plan of distributing the seven-thirties was
that of employing a large number of arents
in many places. and directing their action
from the Department. it worked well for a
time, but was soon found inadequate to tLe
financial necessities of the government.
For the distribution of the five-twenties,
therefore, a different plan was adopted.
After ascertaining, by inquiry, that they
could not be disposed of to capitalists in
amounts sufficient for prompt payment of
the army and navy, and for the satisfaction
of the just claims of public creditors gen
erally, without serious loss. the Secretary
determined to employ a general agent, un
der adequate bonds, and confide the whole
work of distribution, except FO far as it
could be effected by the Treasurer, Assist
ant Treasurers, and Designated Deposito
ries, to him and to sub-agents designated
by hint and responsible immediately to hint.
Coder this plan, and chiefly through the
indefatigable efforts of the general agent
'and his sub-agents, five-twenty bonds to
the amount of nearly four hundred utilliotls
of dollars, in denominations of tifly, oue
=I
hundred, live hundred, and one thousand
dollars, were distributed through Out the
whole country, not controlled by she rebel
lion, and atuong all classes of our country
men. The history of the world may be
searched in vain for a parallel case of pop
ular financial support toe national govern
ment. The Secretary is unable to perceive
in what better or more effectual mode the
important objector distribution could be ac
complished, and he proposes no departure
from it, except rich as considerations of
economy, harmonized with efficiency-, may
suggest..
B.—The object of future controllability
has also had a prominent place in the re
gards of the Secretary. Under the condi
tions which existed at the outbreak of the
rebellion, he aequiest•ed in the necessity
whit h seemed to dictate the negotiation of
bon is payable otter twenty years; but he
acquiesced with reluctance, at I. as noon as
permitted by circumstances, recommended
the enactment of laws authorizing the issue
of bonds payable after shorter periods, as
well as the creation of temporary debt in
other forms. In harmony with these views
Congress provided for the issue of the Iginds
known as the five-twenties; and also for the
issue of treasury notes payable three years
from date; for certificates of indebtedness
payable in one year, and for temporary
loans by deposits, reimbursable after ten
days' notice. At the last session Congress
repealed some embarassing restrictions of
former nets, anti authorized the issue of
bonds payable after ten years, and of trean
ury notes payable at pleasure or three years
from date. These treasury notes were made
legal tenders for face value or convertible
for amount and interest into United States
notes.
EB=
Min=
The Secretary availed himself of this
legislation by placing with the people as
large an amount as possible of five-twenty
bonds, and by using the other powers so as
to put the whole debt, except the long loans
first negotiated, in such a shapethnt prompt
advantage can be taken of favorable cir
cumstances to diminish the burdens it im
poses on industry. Whenever the constitu
tional supremacy of the nation shall be re
established over all its parts, it will 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 moderate interest and redeemable at
the pleasure of the government, after very
brief periods, or, perhaps, at any time after
their issue.• Nothing further seems desira
ble on the snore of controllability.
Tho anal object of the Secretary was to
extract from the unavoidable evil of debt
as much incidental benefit as possible.
To this end, he desired authority to re
ceive temponny loans in the form of de
posits-reimbursable after a few days' no
tice. This measure was regarded by many
with something less than favor at first; but
Congress, after full consideration, author
ized the receipt of such deposits at an inter
est not exceeding five per cent. to the
amount of twenty-five millions of dollars;
then raised the limit to fifty millions, and
then to en hundred millions; and provided
a reserve of fifty millions of United States
notes to meet demands for reimbursements
beyond other convenient means of satisfac
tion. It was not long before these deposits
reached the highest limit, and, before the
flow could be well checked, somewhat ex
ceeded it. The utility of the measure was
very conspicuous on the recent occasion of
great stringency in New York, when the
Secretary was able to reimburse over fifty
millions of these dePosits during the last
weeks of the year; - by which action the
pressure was sensibly, alleviated, white use
of only a fifth of the reserve.
In former =porta the Secretary has sta
ted his convictions and the grounds of tbem;
ithpecting the necessity and the utility of
putting a large part of the debt in the form .
of United/fiats:a notes, withoutinterescand
adapted to circulation as money. These
convictions remain unchanged,, and seem.
now to be shared by the people. Far the'
first time In our/den:9 , W a areal approach
to a =Venn currency been main; and the
benefi Aturgb. sun far Fram-thedent
attainable condition,, are , felt by ; all.. The
:circulation' has been attributed through:
out the country,. and Is averywbere accept—
ably: xt ottifleattaa AP: ittit*- Alia
„ . •
Vie.
11,
'T +~r~eAft/ ~ ~i
tribetnaFtto dietingialatted s hy the learnitig
and virtue,' of ira aietnbera - as the
Supreme. Galt af'New York has given
the sanction, or - it, ja•igmret to the eeasti-
So, too, real and great advantages are de
rived front the a Ids di:lo , ion of the debt
among the people. thr-ogh I. is Ina., I ran
actions, and '1.,,0u ¢h III.• exertion. of the
officers of the .4,1.0114,n t 0..,1 :be agents
for loans al MS. ly noticed.
I=
It is impor.ildr to c,cirnaic thea.ll..itiages
to national ono.: :.nd national -irength se
cured by this 41kt nbutioo. Every holder
of a note or Lod, from a fir , cent fractional
note to a hie thousand d“11.1,.r land, has a
direct interest in the secorily 111 national
institutions and in the ntsLiliry of national
administration. And it is another and no
small advant.i.zo or ilor diuriloilion that
the burden- or h.•nriert when
loans are held 6c fee, and especially by
foreigner, duntnish in pr. - Tort:on as the
n•ceisors of tater,tis identified with
the payer of la seb.
uniform cor,ney: and aorstemof national
banking. fair to all anti eeee refer all. can
only be safely and ft noir established by
making use of a portion 'lithe national debt
as security for the national currency.
In these several trays may even such
great evils as are brought upon us by re
belliott be ;ran:quitted, by a wise alchemy,
into var , otts forte.; of utility. The Secretary
has endeavored to this alchemy, with
what entrees the country will judge when
lime and trial alien have applied to his
work their unfailing tests.
Meantime additional loans are required.
are fined at OOP htin.ll-,1 millions of dollars.
The &meant of this deposit on the first day
of December h.id been red,ced to
120 IQ and pa ments of S , 10.1,00.1101) had
been made front the reserve. The additional
payments will be confined within the nar
rowest possible limits, and can hardly ex
ceed twenty-five in:limns. The reflow of
deposits has already begun, and will proba
bly soon exceed reimbursement s, and so ar
restpnyinents from the re4erve. The whole
redoes beyond the amount of these payments
till! be available as part of the additional
loan required, and may be stated, without
touch risk of mistake, at twenty-five mil
lions of dollars. The Secretary perceives no
nolid reason for retaining the reStriction on
loans, in this form to one hundred millions
It may, as he thinks, be usefully removed.
Is these advantages of these deposits be
come better and more generally understood,
the loan iu this form will doubtless, in the
absentee of restriction, be largely increased,
and the po,dhility of demands for reim
bursement.. tte and means to meet them,
the existing proportion between deposits
and resert e. Such aunrrangeinent, the
Secretary inclines to think. would operate
beneficially by increasing the amount of
currency when unusual stringency shall re
quire increase, and reducing its amount
when returning ease shall allow reduction.
Another portion of the additional loan re
quired may be obtained through Lb° sale of
the remainder of the bonds known!! as Gee
twentie.. The amount of these bonds ClLl
sullscribe,l for on the first of Decem
ber was $101,0:0.600. It twill not be difficult
to dispose of these at par, and it is possible
that a small premium may be obtained op
a part.
In a former report the Secretary placed
tie limit, to which the loan tu the form of
certificates of indebtedness could be carried
at one hundred millions of dollars. Expe
rience has shown that It can be carried to
one hundred and fifty millions, and that its
natural litrWs about that sum. On the first
of December'lne amount of these certificates
true $ll, - ,7:t.'tyStO. It would be unsafe,
therefore, to rely on any substantial increase
of loan in that form.
, Fat a 'warrant of thii. ocraftdonco, boweier,
he must not omit to say ttrat'he relies' much on
the "rapport to be given tithe,pubtlo matt by
the national - bit:attic
cat es
and lir the nao .
tionntisithmitthi:catrenV:-"-Theis tei,astP
$
thbilt4no `piailbilltjhf. - peitnenentiflraa'
confer nitministrettan o e' tlia ,, C64: undo'
ciliumstances iavolvia •ersatfackai large
41444 tutleilloons ciao .IlestiaJo arentitom .
nfifyi l nil'd ' e l w k' . '*4: . 2 .,. ' ,:,::: :!--. I
. 1 .. ii,* . i.i . ,::Ti0:E4 5 . g , ..:.14 ' 1 , ;, , :,
.'4-(f..;-,47,4-...,-
HJ
Another incidental froM growing from the
itter root et debt, 1141`i Leon fully explained
observations heretofore submitted on the
rational hook.ng system. Eneept through
uch n system nu , ire way is seen to the
troplete and pertonnent estublishotent of n
nd, as It.gislnt ion now stands, •evcral
odes arc open.
NUL, rlo A . LOAN,.
The depoAils for temporary loan
on he folly provided for by on increase of
The limit prcom-lbcd by law to the Issue o
United States notes has been reached, and the
Secretary thinks it clearly inexpedient to in
crease the amount. When circulation exceeds
the legitimate requirements for real payments
and exchanges, no addition to its volume will
increase its value. On the contrary,sudi ad
dition tends inevitably to depreciation; and
depreciation. if addition be continued, wit! ,
find its only practical limit in the utter worth
lessness of the augmented mass.
W hen Congress authorized the creation of
debt, to a curtain extent, in the form of United
States notes, and impressed on these notes
the qualities of a circulating medium, its ac
tion was justified by the disappearance of
coin in consequence of the suspension of
specie payments by the necessity of provid
ing a medium in'which taxes could be rot
lerted, loans received, and payments made;
and by the obvious expediency of providing
that medium in the form of natienal issues
instead of resorting to the paper of banks.
Under the cirennastantes its action wan wise
and necesssary: but it was equally wise and
neceslary to limit the (aurae( the issue. , by
the neemsity which demanded them: They
were wanted to fill the' vaeuntolcaused by the
disappearance of coin and to supply the ad
ditional demands created by the Increased
number and variety of money payments.
Congress believed that four hundred millions
would suffice for those purposes, and there
fore limited issues to that sum.
The Secretary proposes no change of this
limitation, and pLues no reliance, therefore,
on any increase of resources from increase of
circulition. Additional loans in this mode
would, indeed, almost certainly prove illusory;
for diminished value could hardly fail to neu
tralize increased amount.
Sufficient .circulation having been already
provided, the Government must now borrow
like any other employer of capital tepporarily
requiring more than income will supply, and
rely for the credit which will secure advan
tageous loans upon good faith, industrial ac
tivity, accumulated though not Itnmediately
available capital, and satisfactory provision
for punctual payment of accruing Interest
and ultimate reimbursement of principal.
To subAcriptions for the remaining five
twenties and deposits fur temporary loan,.
therefore, must be directed all reasonable ex
pectation of means for the service of the cur
rent year, except from negotiations under the
act of last session. The sums to be looked
for from these two sources have already been
stated, and amount to $1211,059,600. If this
aggregate be deducted from the amount to be
provided by loans fur the last seven months
of the current year, &trendy shown to be
$352,226;4:9, there will remain the sum of
$2.26,166,909 to be provided by negotiations
under the act of last session; and, under some
like act, most be provided in like manner, if
the continuance of the war shall make It ne
cessary, the sum of 04-1,978,54,8 93, estimated
a, likely to he required from loans for the fis
cal year 1863.
The act of last session authorized the loans
supposed to bo required for the focal years
1863 and 1864: and, of the 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 tiny
millions by a loan fur two years five per cent.
treasury notes hare already been provided
under that legislation. The art is so well
conceived and expressed that little other teals
lotion fur the loans of 1864 and 1805 will be
required than the application to those 'earls of
its loading provisions. It will doubtless be
thought expedient this session, as last session,
toautherite the borrowing, in some form, of
three hundred millions for the current, and
hundred millions for the next, fiscal year.
Indeed, the only modifications of the act of
last session necessary to adapt it to the re
quiremente of the current and coming year
seem to be (1) the omission of all reference to
UnitodState*otes beyond thegiving 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 ce
real of the existing limitation of tho &Toad
loan to one hundred millions of dollars, and
the substitution of a provision for a reserve
equal in amount to half dm deposit; (3) the
permission of the negotiation of loans n
aeamable obsoltittiii id pleasure, orat pleasure
after a time fixed, net more remote than forty
years; and (4) the oral/Sloe, perhaps; of the.
clause taming ciretaation and deposits, as being
more appropriate to an internal revenue bill.
It sa hoped that the other provisions of the
last may be retained in the now loan ad. •
Under such legislation, the Secretary enter;
Cain little doubt of being able td obtain
whatever funds will be needed, through loans,
at reasonable rates of interest, for bonds or
treasury notes.
- Tun ItATtONAL BAIIIIIIO STISTEII.'
eottntry, and not liable to variation in plan-
titiOr in 'slue except under the operation Of
nubile] legislation and the general !arse ,
trade. •
Only two kinds of currency fulfil these
con
ditions:the first, a circulation of coin; the
other, a circulation of note+ of uniform do
- ription and value, issued by the Govern
lo,nt, and either paid directly to Government
creditors, or supplied to banking associations
to be employed in general business.
The circulation new generally need in this
contry, except so far no it consists of bank
notes, is of the latter ,ort: and no circulation,
nut 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
measuro:to this ci !lad It been possi
ble to borrow coin enough, and fast enough,
fur the disbursements of the war, almost if
not altogether the came effort: , on prices would
hare boon wrought. Such disbursements
mode in coin would hare enriched fortunate
contractors, stimulated lavish expenditures,
and so inflated prices in the Fame way and
nearly to the same extent as when made in
notes. prices, too, would hare risen from
oilier causes. The"withdrawal from mechan
ical and agricultural occupations of thousands
of our beet, strongest, and most active work
er+, in obedience to their country's summons
to the Gold, would, under any system of cur
rency, hare increased the price of labor, and,
by consequence, the price of the products of
labor, while the price. of many things would
havo risen, in part from other causes, as for
example, the price of railroad bonds from
vast increarie of income, through payments for
military transportation; and the price of cot
ton from deficient supply.
Much the greater part of the rise of prices
not accounted for by the causes just stated, as
well as much the greater part of tho difference
between notes and gold, is attributed to the
large amount of bank notes yet in circulation.
Wore these notes withdrawn !Mill use, it is be
lieved that much Lathe new very considerable
difference between coin and United States
totes would disappear. and
thermought
to be no difference in favor of coin, when it is
remembered that United States bonds bearing
six or even fire per contain coin Interest
are intrinsically worth,unless the theory of na
tional bad faith or national insolvency is to
be admitted, more than their amount in coin;
and yet such bonds can now ho had for their
amount in United States notes.
Nor can a condition of affairs in which ex
...ice prices prevail, or national notes com
mand less than par in coin, be regarded as of
permanent duration. While it lasts, it most
be borne with patience, and made tolerable
by economy. -No useful remedy will be found
in extravagant inertse of salaries and dis
bursements, but an aggravation 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 he relied on
for the rest.
The Secretary has heretofore expressed the
opinion that whatever may be the true degree
In which the ea:Taney •f the country is affect
ed by a bank-note circulation, issued without
national sanction and by corporations inde
pendent of national authority, and not re
ceiveable for national duos, it cannot be ques
tioned that in some similar degree, the nego
tiation of national loans must be prejudiced
and their value to the national finances dimin
ished. This opinion is confirmed by observa
tion and experience.
Impelled, therefore, by a profenund sense
of the present necessity of a national currency
to the successful prosecution of the war
against rebellion, and of itsjitility at all times
in protecting' labor, cheapening exchanges,
facilitating travel, and increasing the safety
of all business transactions and at the same
time unwilling to urge even salutary and no
cesssary reforms in such a way as needlessly
to disturb existing conditions or impair the
value of existing investments of capital, the
Secretary recommended, in two successive re
ports, the authorisation of national banking
associations, to which the capital of the cor
porations now issuing notes for circulation
might be transferred, with, advantake to the
parties in interest as well as to the general
The sanction of Congress was given to these
views at the last session ; add the simple as
surance thus given that, henceforth, the coun
try is to have a national currency secured by
a pledge of national bonds, and the belief that
this currency will at no distant day take the
place of the heterogeneous corporate currency
which has hitherto tilled the channels of cir
culation, at once inspired faith in the securi
ties of the government, and more than any
other one cause enabled the Secretary to pro
vide for the prompt payment of the soldiers
and the public creditors.
If the policy thus Indicated shall be fairly
and judiciously pursued, and proper measures
adopted to induce the conversion, at the ear
liest practicable period. of the bank corpora
tions,of the States into national banking Use
elation., and of the corporate circulation into
national currency, the Secretary believes,and,
as he thinks, not without good grounds, that
all the money needed for prompt payment of
troops, and for the most vigorous prosecution
of the war, eon Le obtained by loans on rea
rouble terms ; whilq. . af UIt , STOSi. 013 debt, and
all ordinary espendiMres, and a considerable
part also of the extraerdieary expenditures
canoed by this war, will be mat by the ordi
nary resources. Nor does he doubt that,
through wise legislation, sustained by intelli
gent popular will, and supported by prudence
and energy in civil and military administra
tion, national currenby can be so approxima
ted in recognized value t° coin, that a re
sumption of paymentein specie can be brought
about much sooner than even amigo the per
sons now permit themselves Ito hope.
The Secretary has already referred in gen
eral terms to the reports of the heads of the
various bureaus and branches of administra
tion in hisdepartment. A peculiar interest Is
felt at this time in their operations, and espe
cially in the operation of those most recently
brought into existence.
Tho Comptroller of the Currency reports the
organization under the national banking act,
prior to the 29th of November, of one hundred
and thirty-four associations ; all which, upon
the suggestion of the Secretary, have adopted
the name of National Banks, distinguithed by
order of organisation and by locality. These
Banking Associations have been formed in
seventeen States, and the District of Colum
bia, and have an aggregate capital of $16,-
081,200. The great care and labor required
for the preparation of suitable notes for the
new national currency has. delayed its issue
beyoudexpectation ; but the printing is.now
begun, and the several assations will be
mipplied with the amounts 4tVwhich they.are
respectively entitled within a few weeks. Be
sides the Associations reported as actually
organized, there are many others in process
- of organisation. Thera, is hardly a State not
controlled by the rebellion, and hardly a con
siderable city, in which a national banking
association has not beer. organized, or is not
being organized. Even New Orleans is not
an exception to this statement.
Thus the great work of introducing a perm
anent national currency has been entered upon
in a spirit and with as energy which pro wise
perfect success. The Secretary thinks he risks
nothing in saying that within the present
year the benefits of the system will have so
approved themselves to the sense and patriot
ism of the people, that it *ill be beyond the
reach of successful assault.
Tho Comptroller has indicated some amend
ments to the law which the Secretary concurs
with him In regarding ad important to its
=cress. As among the most essential of
these, the Secretary asks the special attention
of Congress to the propositien for a uniform
rate of interest, end the repeal of the section
which connects the issues of notional curren
cy in any degree with State banks. The Sec
n=ary also rerommends,sa likely to be useful,
• provision to be made by law for the deposit
with national banks, and also with the Treas
urer and Assistant Treasurers, araueh rates of
interest and for ouch periods of time as the
Secretary may proscribe, of moneys paid into
or invested under the Orders of judicial courts.
It Is not impossible that in this way many
millions would be placed in the treasury at
moderate rates of Interest. •
ISCIIILLSZ or nrrtzs on BANC 0010 =MLA..
TIM
The Suretary tun already referred to the
recommendation of the Corosessioner of In
ternal Revenue, in favor of Increased deities.
He cannot add anything to the general con
siderations he bas already urged In favor of
augmenting revenue by these methods. It
may be useful, however, to invite special at
tention to some considerations which enforce
the recommendation of a duty of 2 2-5 par
cont a year on corporate note circulation.
The propesition contemplates t duty. of
one-Afth of ono per cent, per month on. chin.
tattoo; and the Sweeter, suggests, in addi
tion, one twenty-tifth of one • per cent on do
podia in each month, mating twelve twenty
ffths a year. Under the existing law the duty
on circulation is one per cont, a year on a cer
tain proportion ; two per cut, on amounts ex
egedMg that proportion, andone,fondh of one
por cent. on: &multi. The email addition .
proposed will not be regarded as .unreasen
able or onoions, when. it is considered that
_
all corporate circulation Is in foot a 1 0w...5.
qko people to the - banks without. Mt,
-that of . preparation, and wittthat PAW
opt the ' dudes imposed on
QIIOStiOn then lIMOITINII
ifoty:proposed.Ad,dett -to I:
and the coat of ______
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profits. rather than on property, will 1111
tribgto itself among all who partake of a.
benefits of tho deposits,and press hardly C.
none.
• • -•
It is priposed to make LbeAuty payable it
smell pererrames,becztaitilivill.b• tints IL
tributed over the hilliness. of theyakr aclO
because by requiring monthly returns of ell
culations and depositsceith reference in th.
duties, information will be regularly obutina
io respect to the amount of circulation of al
descriptions in the siholo country, the path
cation of which will be, an important benefit
to all men of business, as well as a valuable
guide to financial legislation and admlnistra
lion.
Monthly returns are now required of man,
of the national banking associations, an,
should be required of all ; and from them, e.
well as from the banks not organized undr
national legislation, should be required a fn't
contribution to the general burdens of Its
people. The Secretary refers to Congress th.
question. whether the duty on national cur
rency and the deposits of national banking
associations shall correspond with the duties
on other circulation and deposits. lie thiaks
that for the present, at tenet, some (Herrin:Li
nation in favor of the national associations
may be properly admitted in consideration of
the indispensable importance of a national
currency, not adapted only, like United States
notes, to temporary emergoneies,_, but perma
nent in its very nature, and adequkte to all de
mands of business, and capable, at no distant
period, of being made equal to and convertible
into coin; and therefore its real repressenta
tire and equivalent.
I=o=l7
The operations of the mint hare been el
less importance than usual during the last
Sear.
The amount of coinage was increased Over
that of last year at San Francisco alone. The
value of the bullion received won. $24,824,-
101 31: in gold 52.3,140,49.5 41 ;and in silver
$1,674,00.5 90; from the total of which most
he deducted the bars made at one branch and
deposited for coinage at another, making the
actual amount deposited $23,701,837 .11. The
coinage of the year was *24,088,477 12: of
which 220,095,852 weN gold coin ; $1,249,-
077 110 gold bars; ;1,174,002 80 silver coin :
er:320,204 42 silver bars; and $476,450 cents.
Of this coinage 54,184,407 37 in 42,108,402
pieces was effected at Philadelphia ; $18,531,-
528 tr. in 2.872.173 pieces at San Francisco;
and $2,157,042 62 in 3,104 gold and silver bars
at Now York.
The branch mint at Denver has been or
ganised and patina operation during the year
but its operations are confined, for the pre
sent, to melting, relining, assaying and stamp
ing bullion.
A report has been made on a Site for a mint
in Nevada, and measures will be taken for its
establishment as coon as possible.
The Secretary renews the recommendation
of preceding reports in relation to the univer
sal measure of commercial values by an in
ternational decimal coinage.
OrrIIATIONS or Till TRE..13111,
The operations of . the treasury proper have
reached anpreeedented magnitude. These are
conducted under, the direction of the Beery
tary, by the Treasurer, the Assistant Treasur
ers, and the Designated Depositaries, by
whom moneys which come into or go out of
the National Treasury are received and die
burled. As receipts and payments have in
creased in number and amount, and assumed
new forms, the !shore and responsibilities of
these officers have taken raster proportions of
magnitude and importance. The general
operations of the year are seen in the state
ments already made of Receipts and Brpen
ditures, but.no general statement can convey
an adequate idea of their variety, extent, and
perplexity. The labor, and care, and.anxiety
Incident to the borrowing, receiving, and pity
ing of the sums necessary to meet the debt
becoming due daring the year, or, in ether
words, the making and applying of the loans
oecesoary to the renewing of maturing leans,
make little show in the Report, and yet em
brace transactions, often complex and neces
sarily multitudinous, which reached, during
the year, $u aggregate of more than a hnn,
dyed and eighty-one millions of dollars. The
responsibility and labor of the whole money
operations of the Treasury may be Inferred
from this statement concerning a comparative
ly small part.
The receipts at the office of the Treasurer
in Washington dining the last Liam] year were
$1,348,029,513 93, and the disbursements
$1,334,615,175 57. At the office of the Assist
ant Treasurer in New York the receipt, were
$637,051,546 i 3, and the disbursements $622,-
842,627 82. At the office of the Assistant
Treasurer in Boston the receipts were $llB,-
900,000, and the disbursements $115,750,000.
At the office of the Assisting Treasurer in
Philadelphia the receipts were $113,249,-
031 27, and the disbursements $109,733,.
546. 03.
The receipts and digbursements at the offices
of the Assistant Treasurers at San Francisco,
and St. Louis, and of tho Designated Deposit
ories, especially at Baltimore Cincinnati and
Louisville, have been largo beyond precedent,
imposing labors and responsibilities corres
pondingly large. The Secretary cannot ex
press too strongly hie satisfaction with the
manner in which these offieert have generally
performed their onerous and multiform duties.
ItuICLATING COIMERCLAL INTEUCOIISSE unarm
TDC LOYAL AND DISLOYAL STATIS.
The act of Congress relating to captured
and abandoned property, approved Mulch 12,
1803, and the proclamation of the President of
the 31st of the same month, devolved upon
the Secretary the duty of regulating commer
cial intercourse in conformity with the acts of
July 13, 1801, and May 20, 1802, and under
license of the President, between the States
declared to be in insurrection and the other
States at the Union; or, to use the description
commonly employed, between the rebel and
loyal States. This duty has been found ex
ceedingly arduous and perplexing.
Prior to the act and proclamation of March,
the Secretary had attempted some restrictive
regulations with the view of preventing sup
plies to rebels; bat the state of the law, and
the terms of the original proclamation, =Ude
it difficult to act with much of or use
fulness, and the regulation of the trade was
assumed almost exclusively by the military
authorities. Immediately, however on the
publication of the proclamation of If:nth, the
Secretary issued regulations of trade, framed
on the best information and with the best
consideration he was capable of giving them ;
and earnest and persevering endeavors were
made to bring the whole subject under their
control and cinder proper supervision. tExpe
rience revealed defects in the regulations,and
they were revised, amended, and republished
in September last.
The subject is too vastand complicated,tbe
appetite for trade is too eager and exacting,
and the impatience of all restraint, however
salutary or necessary, is too great, to allow
any hope of avoiding many and sometimes
just conotluots. But the Secretary has kern
steadily r the plain daty preetribed by
the law oPtillimentingany 'applies from being
carried intedistricts controlled by rebels; the
equally plain duty of allowing and securing,
so far as practicable, without intercourse with
rolools, supplies of necessaries to the inhabi
tants of &Striae in which the-rebellion has
been suppressed; and the clear policy of sup
porting and facilitating the 'efforts of loyal
citizens to obtain wherever obtainable, with
out going beyond the linen of national mili
tary occupation, cotton, sugar, tobacco, tai,
rosin, and suck other products of the rebel
States, for the Benefit of loyal commerce, To
this end he has selected persons of known in
telligence and probity as supervising special
agents, and through them others of like
characters as assistant and • local special
agents, to CIO/Gide the necessary Rowers over
intercourse, end has imposed, with the sanc
tion of tho President, and as conditions of
license, such fees and contributions on the
trade permitted, as wen thought necessary to
defray the cost of supervision, and add unite
thing to the means for the prosecution of the
war. The agents of all grades have gener
ally beta diligent and faithful in- the dis
charge of their several duties. A. few of sub
ordinate grade have proved bteompetout
unworthy, and have been dismissed; 'and the
same measure will be promptly applied to all,
of whatever grade, to whom peddle duty may
require its- applicalion.
snammnsto marravzons, Lc, Le TIM tants-
122112=2
By an order of the Secretroy. of War issued
on the hat of October last, the care of-aban
doned plantations and other reel estate
... PA..
been devolved upon the superelaleg amts,
who have been instructed to accept the charge
and
roe their best endeavors in its execution.
The charge of abandoned tads and plants,
lions necessarily carries sith it, some ....
.toist, the charge of Madman. -:,
The whole chsug• Is 4 . Present under min_
rarY4_
__ tion ,.. l7; for the acts of,- Congress
sE s , L uedoned property retai n cub.
2 , 11 ,.- t o poncmaltY• Abe order is of too re. •-.-
..., data to allow receipts of roma concern
ini . in, praCtical effects. It is only very. clear
that geese system should be adopted and &ton
do.puzsued, which will best. serve Um' great:
obJectir of restoring tranquility, order, and,
prosperity to the States and parts of States in
which the national authority is or maybe: is
establiehed, and atthesame timeseeurip,„o„; '
1 .... and welter* , of. the .loysi:and * fa n _
psaple4-1..T0 thatee,Matteihc labors 'or
e
mmiasioners of Direct Taxes
° action ma . the ' al
11-61111 '
ender e sets -twitting. to ed._
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