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Message of the President of the United States.

[24th Cong. 2d SESS.

observation of the last two years have operated a partial States, but also to produce that vote in the convention change in my views upon this interesting subject, it is, which negatived the proposition to grant power to Connevertheless, regretted that the suggestions made by gress to charter corporations; a proposition well unme, in my annual messages of 1829 and 1830, have been derstood at the time, as intended to authorize the estabgreatly misunderstood. At that time, the great struggle lishment of a national bank, which was to issue a currency was begun against that latitudinarian construction of the

of bank notes, on a capital to be created to some extent constitution which authorizes the unlimited appropria out of Government stocks. Although this proposition tion of the revenues of the Union to internal improve was refused by a direct vote of the convention, the obments within the States, tending to invest in the hands, ject was afterwards in effect obtained, by its ingenious and place under the control, of the General Govern advocates, through a strained construction of the conment, all the principal roads and canals of the country, stitution. The debts of the Revolution were funded, at in violation of State rights, and in derogation of State prices which formed no equivalent, compared with the authority. At the same time, the condition of the manu nominal amount of the stock, and under circumstances facturing interest was such as to create an apprehension which exposed the motives of some of those who partithat the duties on imports could not, without extensive cipated in the passage of the act, to distrust. mischief, be reduced in season to prevent the accumu. The facts that the value of the stocks was greatly en. lation of a considerable surplus after the payment of the hanced by the creation of the bank, that it was well unnational debt. In view of the dangers of such a surplus, derstood that such would be the case, and that some of and in preference to its application to internal improve the advocates of the measure were largely benefited by ments, in derogation of the rights and powers of the it, belong to the history of the times, and are well cal. States, the suggestion of an amendment of the constitu culated to diminish the respect which might otherwise tion to authorize its distribution was made. It was an have been due to the action of the Congress which crealternative for what were deemed greater evils--a tem ated the institution. porary resort to relieve an over-burdened Treasury, On the establishment of a national bank, it became until the Government could, without a sudden and de the interest of its creditors that gold should be superstructive revulsion in the business of the country, grad seded by the paper of a bank as a general currency. A ually return to the just principle of raising no more value was soon attached to the gold coins, which made revenue from the people, in taxes, than is necessary for their exportation to foreign countries as a mercantile its economical support. Even that alternative was not commodity, more profitable than their retention and use spoken of but in connexion with an amendment of the

at home as money. It followed, as a matter of course, constitution. No temporary inconvenience can justify if not designed by those who established the bank, that the exercise of a prohibited power, or a power not the bank became, in effect, a substitute for the mint of granted by that instrument; and it was from a convic the United States. tion that the power to distribute even a temporary sur Such was the origin of a national bank currency, and plus of revenue is of that character, that it was suggest such the beginning of those difficulties which now aped only in connexion with an appeal to the source of all pear in the excessive issues of the banks incorporated legal power in the General Government, the States by the various States. which have established it. No such appeal has been Although it may not be possible, by any legislative taken, and, in my opinion, a distribution of the surplus means within our power, to change at once the system revenue by Congress, either to the States or the people, which has thus been introduced, and has received the is to be considered as among the prohibitions of the acquiescence of all portions of the country, it is certainconstitution. As already intimated, my views have un ly our duty to do all that is consistent with our constitudergone a change, so far as to be convinced that no tional obligations, to prevent the mischiefs which are alteration of the constitution, in this respect, is wise or threatened by its undue extension. That the efforts of expedient. The infuence of an accumulating surplus the fathers of our Government to guard against it by it upon the legislation of the General Government and the

constitutional provision were founded on an intimate Siates, its effect upon the credit system of the country, knowledge of the subject, has been frequently attes'. producing dangerous extensions and ruinous contrac ed by the bitter experience of the country. The tions, fluctuations in the price of property, rash specil same cause which led them to refuse their sanction to a lation, idleness, extravagance, and a deterioration of power authorizing the establishment of incorporations morals, have taught us the important lesson, that any for banking purposes, now exist in a much stronger de. transient mischief which may attend the reduction of gree to urge us to exert the utmost vigilance in calling our revenue to the wants of our Government is to be into action the means necessary to correct the evils re. borne in preference to an overflowing Treasury:

sulting from the unfortunate exercise of the power; and I beg leave to call your attenion to another subject it is to be hoped that the opportunity of effecting this intimately associated with the preceding one-the cur great good will be improved before the country witnesrency of the country.

scs new scenes of cmbarrassment and distress. It is apparent, from the whole context of the constitu Variableness must ever be the characteristic of a cur. liun, as well as the history of the times which gave birth rency, of which the precious metals are not the chief to it, that it was the purpose of the convention to estab ingredient, or which can be expanded or contracted lish a currency consisting of the precious metals. These, without regard to the principles that regulate the value from their peculiar properties, which rendered them of those metals as a standard in the general trade of the the standard of value in all other countries, were adopt. world. With us, bank issues constitute such a currened in this, as well to establish its commercial standard, cy, and must ever do so, until ihey are made dependant in reference to foreign countries, by a permanent rule, on those just proportions of gold and silver, as a circu. as to exclude the use of a mutable medium of exchange, lating medium, which experience has proved to be neces. such as of certain agricultural commodities, recognised sary, not only in this, but in all other commercial countries. by the statutes of some States as a tender for debts, or Where those proportions are not infused into the circu. the still more pernicious expedient of a paper currency. lation, and do not control it, it is manifest that prices The last, froin the experience of the evils of the issues must vary according to the tide of bank issues, and the of paper during the Revolution, had become so justly value and stability of property must stand exposed to all obnoxious, as not only to suggest the clause in the con. the uncertainty wbichi attends the administration of institution forbidding the emission of bills of credit by the stitutions that are constantly liable to the temptation of

24th Cong. 24 Sess.)

Message of the President of the United Stales.

an interest distinct from that of the community in which they are established.

The progress of an expansion, or rather a depreciation of the currency, by excessive bank issues, is always attended by a loss to the laboring classes. This portion of the community bave neither time nor opportunity to watch the ebbs and flows of the money market. E1Gaged from day to day in their useful toils, they do not perceive that, although their wages are nominally the same, or even somewhat bigher, they are greatly reduced, in fact, by the rapid increase of a spurious currency, which, as it appears to make money abound, they are at first inclined to consider a blessing. It is not so with the speculator, by whom this operation is better understood, and is made to contribute to his advantage. It is not until the prices of the necessaries of life become so dear that the laboring classes cannot supply their wants out of their wages, that the wages rise and gradually reach a justly proportioned rate to that of the products of their labor. When thus, by the depreciation in consequence of the quantity of paper in circulation, wages as well as prices become exorbitant, it is soon found that the whole effect of the adulterations is a tariff on our home industry for the benefit of the countries where goki and silver circulate and maintain umiformity and muleration in prices. It is then perceived that the enhancement of the price of land and labor produces a corresponding increase in the price of products, until tliese products do not sustain a competition with similar ones in other countries, and thus both inanufactured and agricultural productions cease to bear exportation from the country of the spurious currency, because they cannot be sold for cost.

This is the process by which specie is banished by the paper of the banks. Their vaults are soon exhausted to pay for foreiga commodities; the next step is a stoppage of specie payment a total degradation of paper as a currencyunusual depression of prices, the ruin of debtors, and the accumulation of property in the hands of creditors and cautious capitalists.

It was in view of these evils, together with the dangerous power wielded by the Bank of the United States, and its repugnance to our constitution, that I was induced to exert the power conferred upon me by the American people to prevent the continuance of that institution. But although various dangers to our repub. lican institutions have been obvialed by the failure of that bank to extort from the Government a renewal of its charter, it is obvious that little has been accomplished except a salutary change of public opinion, towarels restoring to the country the sound currency provided for in the constitution. In the acts of several of the States probibiting the circulation of small notes, and the auxiliary enactinents of Congress at the last session, forbidding their reception or payment on public account, the true policy of the country lias been advanced, and a larger portion of the precious metals infused into our circulating medium. These measures will probably be followed up in due time by the enactment of State Huws, banishing from circulation bank notes of still Joigher denominations ; and thic object may be materi. ally promoted by further acis of Congress, forbidding the employment, as fiscal agents, of such banks as con. tinue to issue notes of low denominations, and throw impedimenis in the way of the circulation of goid and silver.

The effects of an extension of bank credits and overissues of bank paper have been strikingly illustrated in llic sales of the public lands. From the relurns made by the various Registers and Receivers in the early part of last sunmer, it was perceived that the receipis arising from the sales of the public lands were increasing to an unprecedented amount. In effect, howerer, these

receipts amounted to nothing more than credits in bank. The banks let out their notes to speculators ; they were paid to the Receivers, and immediately returned to the banks, to be sent out again and again, being mere instruments to transfer to speculators the most valuable public land, and pay the Government by a credit on the books of the banks. Those credits on the books of some of the western banks, usually called deposites, were al. ready greatly beyond their immediate means of payment, and were rapidly increasing. Indeed, each speculation furnished means for another ; for no sooner had ove individual or company paid in the notes, than they were immediately lent to another for a like purpose ; and the banks were extending their business and their issues 50 largely, as to alarm considerale men, and render it doubtful whether these bank credits, if permitted to accumulate, would ultimately be of the least value to the Government. The spirit of expansion and speculation was not confined to the deposite banks, but pervaded the whole multitude of banks throughout the Union, and was giving rise to new institutions to aggravate the evil.

The safely of the public funds, and the interest of the people, generally, required that these operations should be checked, and it became the duty of every branch of the General and State Governments to adopt all legiti. mate and proper means to produce that salutary effect. Under this view of my duty, I directed the issuing of the order which will be laid before you by the Secretary of the Treasury, requiring payment for the public lands sold to be made in specie, with an exception until the filteenth of the present month in favor of actual settlers. This measure has produced many salutary consequences. It checked the career of the Western banks, and gave them additional strength in anticipation of the pressure which has since pervaded our Eastern as well as the E!. ropean commercial cities. By preventing the extension of the credit system, it measurably cut off the means of speculation, and retarded its progress in monopolizing the most valuable of the public lands. It has tended to save the new States from a non-resident proprietorship, one of the greatest obstacles to the advancement of a new country, and the prosperity of an old one. It has tended to keep open the public lands for entry by emigrants, at Government prices, instead of their being compelled to purchase of speculators at double or treble prices. Ard it is conveying into the interior large sims in silver and gold, there to enter permanently into the currency of the country, and place it on a firmer fowdation. It is confidently believed that the country wil find, in the motives which induced that order, and the happy consequences which will lave ensued, much 10 commend, and nothing to condemn.

It remains for Congress, if they approve the policy which dictated this order, to follow it up in its various bearings. Much good, in my judgment, would be pro. duced by probibiting sales of the public lands, except to actual seillers, it a reasonable reduction of price, and tu limit the quantity which shall be sold to them. Al. though it is believed the General Government never ougle to receive any thing but the constitutional curren. cy in exchange for the public lands, What point would be of less importancc if the lands were sold' for immediate settlement and cultivation. Indeed, there is scarcely a mischiefarising out of our present land system, including the accumulating' surplus of revenue, which would not be remedied at once by a restriction on land sales to actual settlers; and it promises other advantages to the country in general, and to the new States in particular, which cannot fail to receive the most profound consideration of Congress.

Experience continues to realize the expectations en. tertained us to the capacity of the Sia.c banks to pero

Message of the President of the United States.

[24th Cong. 20 Sess.

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form the duties of fiscal agents for the Government, at the time of the removal of the deposiles. It was alleged by the advocates of the Bank of the United States, that the State banks, whatever might be the regulations of the Treasury Department, could not make the transfers required by the Government, or regotiate the domestic exchanges of the country. It is now well ascertained that the real domest c exchanges, performed throug ii discounts, by the United Stales Bark and its twenty-five branches, were at least one-third less than those of the deposite banks for an equal period of lime; and if a comparison be instituted between the amounts of service rendered by these in titutions, on the broader basis which has been used by the advocates of the United States Bank, in estimating what they consider the domestic exchanges transacted by it, the result will be still more fa. vorable to the deposite banks.

The whole amount of public money transferred by the Bank of the United States in 1832, was $ 16,000,000. The amount transferred and actually paid by the deposite banks in the year ending the first of October last, was $59,319,899; the amount transferred and paid between that period and the 6th November, was $5,399,000; and the amount of transfer warrants outstanding on that day, was $14,450,000; making an aggregate of $59,168,894. These enormous sums of money first mentioned have been transferred with the greatest promptitude and regu. larity; and the rates at which the exchanges have been negotiated previously to the passage of the deposite act were generally below those charged by the Bank of the United Siates. Independently of these services, which are far greater than those rendered by the United States Bank and its twenty-five branches, a number of the deposite banks, bave, with a commendable zeal to aid in the improvement of the currency, imported from abroad, at their own expense, large sums of the precious metals for coinage and circulation.

In the same manner have nearly all the predictions turned out in respect to the effect of the removal of the deposites—a step unquestionably necessary to prevent the evils which it was foreseen the bank itself would endeavor to create in a final struggle to procure a renewal of its charter. It may be thus, too, in some degree, with the further steps wbich may be taken to prevent the excessive issue of other bank paper ; but it is to be hoped that nothing will now deler the Federal and State authorities from the firm and vigorous performance of their duties to themselves and to the people in this respect.

In reducing the revenue to the wants of the Government, your particular attention is invited to those articles which constilute the necessaries of life. The duty on salt was laid as a war tay, and was no doubt continu. ed to assist in providing for the payment of the war debt. There is no article, the release of which froin taxation would be felt so generally and so beneficially. To this may be added all kinds of fuel and provisions. Justice and benevolence unite in favor of releasing the poor of our cities from burdens which are not necessary to the support of our Government, and tend only to increase the wants of the destitute.

It will be seen by the report of the Secretary of the Treasury, and the accompanying documents, that the Bank of the United States bus made no payment on ac. count of the stock beld by the Government in that institution, although urged to pay any portion which might suit its convenience, and that it has given no information when payment may be expected. Nor, although re. peatedly requested, bas it furnished the information in relation to its condition, which Congress authorized the Secretary to collect at their last session. Such measures as are within the power of the Executive bave been taken to ascertain the value of the stock, and procure the payment as early as possible.

The conduct and present condition of that bank, and The great amount of capital vested in it by the United States, require your careful attention. Its charter expired on the third day of March last, and it has now no power but that given in the 21st section, “to use the corporate name, style, and capacity, for the purpose of suits, for the final setilement and liquidation of the af. fairs and accounts of the corporation, and for the sale and disposition of their estate, real, personal, and mix. ed, but not for any other purpose, or in any otlier manner whatsoever, nor for a period exceeding two years after the expiration of the said term of incorporation." Before the expiration of the charter, the stockholders of the bank obtained an act of incorporation from the Legislature of Pennsylvania, excluding only the United States. Instead of proceeding to wind up their concerns, and pay over to the United States the amount due on account of the stock held by them, the President and Din rectors of the old bank appear to have transferred the books, papers, notes, obligations, and most or all of its properiy, to this new corporation, which entered upon business as a continuation of the old concern. Among other acts of questionable validity, the notes of the expired corporalion are known to have been used as its own, and again put in circulation. That the old bank had no right to issue or re-issue its notes after the er. piration of its charler, cannot be denied ; and that it could not confer any such right on its substituie, any more than exercise it itself, is equally plain. In law and honesty, the notes of the bank in circulation, at the expiration of its charter, should have been called in by public advertisement, paid up as presented, and togellier wiib ihose on hand, cancelled and destroyed. Their re-issue is sanctioned by no law, and warranted by no necesity. If the United States be responsible in their slock for the payment of these notes, their re-issue by the new corporation, for their own profit, is a fraud on the Government. If the United Stales is not sponsible, then there is no legal responsibility in any quarter, and it is a fraud on the country. They are the redeemed notes of a dissolved partnership, but, contrary to the wishes of the retiring partner, and without his consent, are again re.issued and circulated.

It is the high and peculiar duty of Congress to decide whether any further legislation be necessary for the gecurity of the large amount of public properly now held, and in use by the new bank, and for vindicating the rights of the Government, and compelling a speedy and honest seitlement with all the creditors of the old bank, public and private, or whether the subject shall be left to the power now possessed by the Executive and Ju. diciary. It remains to be seen whether the persons, who, as managers of the old bank, undertook lo control the Government, retained the public dividends, shut their doors upon a committee of the House of Representatives, and filled the country with panic to accomplish ibeir own sinister objects, may now, as managers of a new bank, continue with impunity to food the coun. try with a spurious currency; use the seven millions of Government stock for their own profit, and refuse to the United States all information as to the present condition of their own properly, and the prospect of recovering it into their own possession.

The lessons taught by the Bank of the United States cannot well be lost upon the American people. They will take care never again to place so tremendous a power in irresponsible hands; and it will be fortunate if they seriously consider the consequences wbich are like. ly to result on a smaller scale from the facility with which corporate powers are granted by their State Governments.

It is believed that the law of the last session, regularing the deposite banks, operates onerously and unjustly

re

24h Coxo. 2d Sess.]

Alessuge of the President of the United States.

upon them in many respects; and it is hoped that Congress, on proper representation, will adopt the modifi. cations which are necessary to prevent this consequence.

The report of the Secretary of War ad interim, and the accompanying documents, all which are here with laid before you, will give you a full view of the diversified and important operations of that Department during the past year.

The military movements rendered necessary by the aggressions of the hostile portions of the Seminole and Creek tribes of Indians, and by other circumstances, bave required the active employment of nearly our whole re. gular force, including the marine corps, and of large bodies of militia and volunteers. With all these events, so far as they were known at the seat of Government before the termination of your last session, you are al. ready acquainted; and it is, therefore, only needful in this place to lay before you a brief summary of what has since occurred.

The war with the Seminoles, during the summer, was, on our part, chiefly confined to the protection of our frontier settlements from the incursions of the enemy; and, as a necessary and important means for the accom. plishment of that end, to the maintenance of the pos's previously established. In the course of this duly, several actions took place, in which the bravery and discipline of both officers and men were conspicuously displayed, and which I have deemed it proper to notice, in respect to the former, by the granting of brevet rank for gallant services in the field. But as the force of the Indians was not so far weakened by these partial successes as to lead them to submit, and as their savage inroads were frequently repeated, early measures were taken for placing at the disposal of Governor Call, who, as coinmander-in-chief of the territorial militia, had been tem. porarily invested with the command, an ample force, for the purpose of resuming offensive operations, in the most efficient mannor, so soon as the season should permit. Major General Jesup was also direcied, on The conclusion of his duties in the Creek country, to repair to Florida, and assume the command.

The result of the first movement made by the forces under the direction of Governor Call, in October last, as detailed in the accompanying papers, excited much surprise and disappointment. A full explanation has been required of the causes which led to the failure of that movement, but has not yet been received. In the mean time, as it was feared that the health of Governor Call, who was understood to have suffered much from sickness, might not be adequate to the crisis, and as Major General Jesup was known to have reached Florida, that officer was directed to assume the command, and to prosecute all needful operations with the utmost promplilude and vigor. From the force at his disposal, and ihe dispositions he has made, and is instructed to make, and from the very efficient measures which it is since ascer. tained have been taken by Governor Call, there is reason to hope that they will soon be enabled to reduce the enemy to subjection. In the meantime, as you will perceive from the report of the Secretary, there is urgent necessity for further appropriations to suppress these hostilities.

Happily for the interests of humanity, the hostilities with the Creeks were brought to a close soon after your adjournment, without that esfusion of blood which at one time was apprehended as inevitable. The unconditional submission of the hostile party was followed by their speedy removal to the country assigned them west of the Mississippi. The inquiry as to alleged frauds in the purchase of the reservations of those Indians, and the cause of their hostilities, requested by the resolu. tion of the House of Representatives of the 1st of July last, to be made by the President, is now going on,

through the agency of commissioners appointed for that purpose. Their report may be expected during your present session.

The difficulties apprehended in the Cherokee coun. try have been prevented, ani the peace and safety of that region and its vicinity effectually secured, by the rimely measures taken by the War Department, and still continued.

The discretionary authority given to General Gaines to cross the Sabine, and to occupy a position as far west as Nacogdoches, in case he should deem such a step necessary to the protection of the frontier, and to the ful. filment of the stipulations contained in our treaty with Mexico, and the movement subsequently made by that officer, have been alluded to in a former part of this message. At the date of the latest intelligence from Nacogdoches, our troops were yet at that station; but the officer who has succeeded General Gaines has re. cently been advised, that, from the facts known at the seat of Government, there would seem to be no adequate cause for any longer maintaining that position; and he was accordingly instructed, in case the troops were not already withdrawn under the discretionary powers before possessed by him, to give the requisite orders for that purpose, on the receipt of the instructions, unless he shall then have in his possession such information as shall satisfy him that the maintenance of the post is es. sential to the protection of our frontiers, and to the due execution of our treaty stipulations, as previously explained to him.

Whilst the necessities existing during the present year, for the service of militia and volunteers, have fur. nished new proofs of the patriotism of our fellow-citizens, they have also strongly illustrated the importance of an increase in the rank and file of the regular army. The views of this subject, submitted by the Secretary of War, in his report, meet my entire concurrence, and are earnestly commended to the deliberate attention of Con. gress. In this connexion, it is also proper to remind you, that the defects in our present militia system are every day rendered more apparent. The duty of making further provision by law, for organizing, arming, and disciplining this arm of defence, has been so repeatedly represented to Congress by myself and my predecessors, that I deem it sufficient, on this occasion, to refer to the last annual message and to former Executive communications, in which the subject has been dis. cussed.

It appears, from the reports of the officers charged with mustering into service the volunteers called for under the act of Congress of the last session, that more presented themselves at the place of rendezvous in Tennessee, than were sufficient to meet the requisition which had been made by the Secretary of War upon the Governor of that State. This was occasioned by the omission of the Governor to apportion the requisition to the different regiments of militia, so as to obtain the proper number of troops, and no more. It seems but just to the patriotic citizens who repaired to the general rendezvous, under circumstances authorizing them to believe that their services were needed, and would be accepted, that the expenses incurred by them, while absent from their homes, should be paid by the Government. I accordingly recommend that a law to this effect be passed by Congress, giving them a compensation which will cover their expenses on the march to and from the place of rendezvous, and while there; in connexion with which, it will also be proper to make provision for such other equitable claims, growing out of the service of the militia, as may not be embraced in the existing laws.

On the unexpected breaking out of hostilities in Florida, Alabama, and Georgia, it became necessary, in some

Message of the President of the United States.

[24th Cong. 2d Sess.

cases to take the property of individuals for public use. your early and mature deliberation ; and that it may issue Provision should be made by law for indemnifying the in the adoption of legislative measures adapted to the cirowners; and I would also respectfully suggest whether cumstances and duties of the present crisis. some provision may not be made, consistently with the You are referred to the report of the Secretary of the principles of our Governinent, for the relief of the sufferers Navy for a satisfactory view of the operations of the deby Indian depredations, by the operations of our own partment under his charge during the present year. In troops.

the construction of vesseis at the different navy yards, and No time was lost, after the making of the requisite ap- in the employment of our ships and squadrons at sea, that propriations, in resuming the great national work of com branch of the service has been actively and usefully empleting the unfinished fortifications on our seaboard, and of ployed. While the situation of our commercial interests placing them in a proper state of defence. In consequence, in the West Indies required a greater number than usual however, of the very late day at which those bills were of armed vessels to be kept on that station, it is gratifying passed, but little progress could be made during the season to perceive that the protection due to our commerce in which has just closed. A very large amount of the other quarters of the world has not proved insufficient. moneys granted at your last session accordingly remains Every effort has been made to facilitate the equipment of unexpended; but as the work will be again resumed at the the exploring expedition authorized by the act of the last carliest moment in the coming spring, the balance of the session, but all the preparation necessary to enable it to existing appropriations, and in several cases which will be sail has not yet been completed. No means will be spared laid before you, with the proper estimates, further sums for i by the Government to fit out the expedition on a scale corthe like objects may be usefully expended during the next responding with the liberal appropriations for the purpose, year.

and with the elevated character of the objects which are to The recommendations of an increase in the engineer be effected by it. corps, and for a reorganization of the topographical corps, I beg leave to renew the recommendation made in my submitted to you in my last annual message, derive addi- last annual message respecting the enlistment of boys in tional strength from the great embarrassments experienced, our naval service, and to urge upon your attention the neduring the present year, in those branches of the service, cessity of further appropriations to increase the number of and under which they are now suffering. Several of the ships afloat, and to enlarge generally the capacity and force most important surveys and constructions, directed by re- of the navy. The increase of our commerce, and our pocent laws, have been suspended in consequence of the sition in regard to the other Powers of the world, will want of adequate force in these corps.

always make it our policy and interest to cherish the great The like observations may be applied to the ordnance naval resources of our country. corps and to the general staff, the operations of which, as The report of the Postmaster General presents a gratifythey are now organized, must either be frequently inter- ing picture of the condition of the Post Office Department. rupted, or performed by officers taken from the line of the Its revenues, for the year ending the 30th June last, were army, to the great prejudice of the service.

$3,398,455 19, showing an increase of revenue over that For a general view of the condition of the Military Acad- of the preceding year of $404, 578 53, or more than thiremy, and of other branches of the military service not al- | teen per cent. The expenditures for the same year were ready notieed, as well as for fuller illustrations of those $2,755,623 76, exhibiting a surplus of $642,831 43. The which have been mentioned, I refer you to the accompany- Department has been redeemed from embarrassment and ing documents; and among the various proposals contained debt; has accumulated a surplus of more than half a miltherein for legislative action, I would particularly notice lion of dollars; has largely extended, and is preparing still the suggestion of the Secretary of War, for the revision of further to extend, the mail service, and recommends a rethe pay of the army, as entitled to your favorable regard. duction of postages equal to about twenty per cent.

It is The national policy, founded alike in interest and in hu- practising upon the great principle which should control manity, so long and to steadily pursued by this Govern- every branch of our Government, of rendering to the pubment, for the removal of the Indian tribes originally settled lic the greatest good possible, with the least possible taxaon this side of the Mississippi to the west of that river, may tion to the people. be said to have been consummated by the conclusion of The scale of postages suggested by the Postmaster Genthe late treaty with the Cherokees. The measures taken eral recommends itself, not only by the reduction it proin the execution of that treaty, and in relation to our In- poses, but by the simplicity of its arrangement, its condian affairs generally, will fully appear by referring to the fornity with the Federal currency, and the improvement it accompanying papers. Without dwelling on the numer- will introduce into the accounts of the Department and its ous and important topics embraced in them, I again invite agents. your attention to the importance of providing a well-digest Your particular attention is invited to the subject of mail ed and comprehensive system for the protection, supervis-, contracts with railroad companies. The present laws proion, and improvement of the various tribes now planted in viding for the making of contracts are based upon the prethe Indian country. The suggestions submitted by the sumption that competition among bidders will secure the Commissioner of Indian Affairs, and enforced by the Sec- service at a fair price. But on most of the railroad lines retary, on this subject, and also in regard to the establish- there is no competition in that kind of transportation, and ment of additional military posts in the Indian country, are advertising is therefore useless. No contract can now be entitled to your profound consideration. Both measures made with them, except such as shall be negotiated before are necessary, for the double purpose of protecting the In- the time of offering or afterwards, and the power of the dians from intestine war, and in other respects complying Postmaster General to pay them high prices is, practically, with our engagements to them, and of securing our West without limitation. It would be a relief to him, and no ern frontier against incursions which otherwise will assu- doubt would conduce to the public interest, to prescribe by redly be made on it. The best hopes of humanity in re- law some equitable basis upon which such contracts shall gard to the aboriginal race, the welfare of our rapidly ex- rest, and restrict him by a fixed rule of allowance. · Under tending settlements, and the honor of the United Siates, a liberal act of that sort, he would undoubtedly be able to are all deeply involved in the relations existing between secure the services of most of the railroad companies, and this Government and the emigrating tribes. I trust, there the interest of the Department would be thus advanced. fore, that the various matters submitted in the accompany The correspondence between the people of the United ing documents, in respect to those relations, will receive ! States and the European nations, and particularly with the

Vol. XIII-B

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