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President[ John Tyler

         Date[ December 7, 1841

To the Senate and House of Representatives of the United States:

In coming together, fellow-citizens, to enter again upon the discharge of

the duties with which the people have charged us severally, we find great

occasion to rejoice in the general prosperity of the country. We are in the

enjoyment of all the blessings of civil and religious liberty, with

unexampled means of education, knowledge, and improvement. Through the year

which is now drawing to a close peace has been in our borders and plenty in

our habitations, and although disease has visited some few portions of the

land with distress and mortality, yet in general the health of the people

has been preserved, and we are all called upon by the highest obligations

of duty to renew our thanks and our devotion to our Heavenly Parent, who

has continued to vouchsafe to us the eminent blessings which surround us

and who has so signally crowned the year with His goodness. If we find

ourselves increasing beyond example in numbers, in strength, in wealth, in

knowledge, in everything which promotes human and social happiness, let us

ever remember our dependence for all these on the protection and merciful

dispensations of Divine Providence.

Since your last adjournment Alexander McLeod, a British subject who was

indicted for the murder of an American citizen, and whose case has been the

subject of a correspondence heretofore communicated to you, has been

acquitted by the verdict of an impartial and intelligent jury, and has

under the judgment of the court been regularly discharged.

Great Britain having made known to this Government that the expedition

which was fitted out from Canada for the destruction of the steamboat

Caroline in the winter of 1837, and which resulted in the destruction of

said boat and in the death of an American citizen, was undertaken by orders

emanating from the authorities of the British Government in Canada, and

demanding the discharge of McLeod upon the ground that if engaged in that

expedition he did but fulfill the orders of his Government, has thus been

answered in the only way in which she could be answered by a government the

powers of which are distributed among its several departments by the

fundamental law. Happily for the people of Great Britain, as well as those

of the United States, the only mode by which an individual arraigned for a

criminal offense before the courts of either can obtain his discharge is by

the independent action of the judiciary and by proceedings equally familiar

to the courts of both countries.

If in Great Britain a power exists in the Crown to cause to be entered a

nolle prosequi, which is not the case with the Executive power of the

United States upon a prosecution pending in a State court, yet there no

more than here can the chief executive power rescue a prisoner from custody

without an order of the proper tribunal directing his discharge. The

precise stage of the proceedings at which such order may be made is a

matter of municipal regulation exclusively, and not to be complained of by

any other government. In cases of this kind a government becomes

politically responsible only when its tribunals of last resort are shown to

have rendered unjust and injurious judgments in matters not doubtful. To

the establishment and elucidation of this principle no nation has lent its

authority more efficiently than Great Britain. Alexander McLeod, having his

option either to prosecute a writ of error from the decision of the supreme

court of New York, which had been rendered upon his application for a

discharge, to the Supreme Court of the United States, or to submit his case

to the decision of a jury, preferred the latter, deeming it the readiest

mode of obtaining his liberation; and the result has fully sustained the

wisdom of his choice. The manner in which the issue submitted was tried

will satisfy the English Government that the principles of justice will

never fail to govern the enlightened decision of an American tribunal. I

can not fail, however, to suggest to Congress the propriety, and in some

degree the necessity, of making such provisions by law, so far as they may

constitutionally do so, for the removal at their commencement and at the

option of the party of all such cases as may hereafter arise, and which may

involve the faithful observance and execution of our international

obligations, from the State to the Federal judiciary. This Government, by

our institutions, is charged with the maintenance of peace and the

preservation of amicable relations with the nations of the earth, and ought

to possess without question all the reasonable and proper means of

maintaining the one and preserving the other. While just confidence is felt

in the judiciary of the States, yet this Government ought to be competent

in itself for the fulfillment of the high duties which have been devolved

upon it under the organic law by the States themselves.

In the month of September a party of armed men from Upper Canada invaded

the territory of the United States and forcibly seized upon the person of

one Grogan, and under circumstances of great harshness hurriedly carried

him beyond the limits of the United States and delivered him up to the

authorities of Upper Canada. His immediate discharge was ordered by those

authorities upon the facts of the case being brought to their knowledge--a

course of procedure which was to have been expected from a nation with whom

we are at peace, and which was not more due to the rights of the United

States than to its own regard for justice. The correspondence which passed

between the Department of State and the British envoy, Mr. Fox, and with

the governor of Vermont, as soon as the facts had been made known to this

department, are herewith communicated.

I regret that it is not in my power to make known to you an equally

satisfactory conclusion in the case of the Caroline steamer, with the

circumstances connected with the destruction of which, in December, 1837,

by an armed force fitted out in the Province of Upper Canada, you are

already made acquainted. No such atonement as was due for the public wrong

done to the United States by this invasion of her territory, so wholly

irreconcilable with her rights as an independent power, has yet been made.

In the view taken by this Government the inquiry whether the vessel was in

the employment of those who were prosecuting an unauthorized war against

that Province or was engaged by the owner in the business of transporting

passengers to and from Navy Island in hopes of private gain, which was most

probably the case, in no degree alters the real question at issue between

the two Governments. This Government can never concede to any foreign

government the power, except in a case of the most urgent and extreme

necessity, of invading its territory, either to arrest the persons or

destroy the property of those who may have violated the municipal laws of

such foreign government or have disregarded their obligations arising under

the law of nations. The territory of the United States must be regarded as

sacredly secure against all such invasions until they shall voluntarily

acknowledge their inability to acquit themselves of their duties to others.

And in announcing this sentiment I do but affirm a principle which no

nation on earth would be more ready to vindicate at all hazards than the

people and Government of Great Britain. If upon a full investigation of all

the facts it shall appear that the owner of the Caroline was governed by a

hostile intent or had made common cause with those who were in the

occupancy of Navy Island, then so far as he is concerned there can be no

claim to indemnity for the destruction of his boat which this Government

would feel itself bound to prosecute, since he would have acted not only in

derogation of the rights of Great Britain, but in clear violation of the

laws of the United States; but that is a question which, however settled,

in no manner involves the higher consideration of the violation of

territorial sovereignty and jurisdiction. To recognize it as an admissible

practice that each Government in its turn, upon any sudden and unauthorized

outbreak which, on a frontier the extent of which renders it impossible for

either to have an efficient force on every mile of it, and which outbreak,

therefore, neither may be able to suppress in a day, may take vengeance

into its own hands, and without even a remonstrance, and in the absence of

any pressing or overruling necessity may invade the territory of the other,

would inevitably lead to results equally to be deplored by both. When

border collisions come to receive the sanction or to be made on the

authority of either Government general war must be the inevitable result.

While it is the ardent desire of the United States to cultivate the

relations of peace with all nations and to fulfill all the duties of good

neighborhood toward those who possess territories adjoining their own, that

very desire would lead them to deny the right of any foreign power to

invade their boundary with an armed force. The correspondence between the

two Governments on this subject will at a future day of your session be

submitted to your consideration; and in the meantime I can not but indulge

the hope that the British Government will see the propriety of renouncing

as a rule of future action the precedent which has been set in the affair

at Schlosser.

I herewith submit the correspondence which has recently taken place between

the American minister at the Court of St. James, Mr. Stevenson, and the

minister of foreign affairs of that Government on the right claimed by that

Government to visit and detain vessels sailing under the American flag and

engaged in prosecuting lawful commerce in the African seas. Our commercial

interests in that region have experienced considerable increase and have

become an object of much importance, and it is the duty of this Government

to protect them against all improper and vexatious interruption. However

desirous the United States may be for the suppression of the slave trade,

they can not consent to interpolations into the maritime code at the mere

will and pleasure of other governments. We deny the right of any such

interpolation to any one or all the nations of the earth without our

consent. We claim to have a voice in all amendments or alterations of that

code, and when we are given to understand, as in this instance, by a

foreign government that its treaties with other nations can not be executed

without the establishment and enforcement of new principles of maritime

police, to be applied without our consent, we must employ a language

neither of equivocal import or susceptible of misconstruction. American

citizens prosecuting a lawful commerce in the African seas under the flag

of their country are not responsible for the abuse or unlawful use of that

flag by others; nor can they rightfully on account of any such alleged

abuses be interrupted, molested, or detained while on the ocean, and if

thus molested and detained while pursuing honest voyages in the usual way

and violating no law themselves they are unquestionably entitled to

indemnity. This Government has manifested its repugnance to the slave trade

in a manner which can not be misunderstood. By its fundamental law it

prescribed limits in point of time to its continuance, and against its own

citizens who might so far forget the rights of humanity as to engage in

that wicked traffic it has long since by its municipal laws denounced the

most condign punishment. Many of the States composing this Union had made

appeals to the civilized world for its suppression long before the moral

sense of other nations had become shocked by the iniquities of the traffic.

Whether this Government should now enter into treaties containing mutual

stipulations upon this subject is a question for its mature deliberation.

Certain it is that if the right to detain American ships on the high seas

can be justified on the plea of a necessity for such detention arising out

of the existence of treaties between other nations, the same plea may, be

extended and enlarged by the new stipulations of new treaties to which the

United States may not be a party. This Government will not cease to urge

upon that of Great Britain full and ample remuneration for all losses,

whether arising from detention or otherwise, to which American citizens

have heretofore been or may hereafter be subjected by the exercise of

rights which this Government can not recognize as legitimate and proper.

Nor will I indulge a doubt but that the sense of justice of Great Britain

will constrain her to make retribution for any wrong or loss which any

American citizen engaged in the prosecution of lawful commerce may have

experienced at the hands of her cruisers or other public authorities. This

Government, at the same time, will relax no effort to prevent its citizens,

if there be any so disposed, from prosecuting a traffic so revolting to the

feelings of humanity. It seeks to do no more than to protect the fair and

honest trader from molestation and injury; but while the enterprising

mariner engaged in the pursuit of an honorable trade is entitled to its

protection, it will visit with condign punishment others of an opposite

character.

I invite your attention to existing laws for the suppression of the African

slave trade, and recommend all such alterations as may give to them greater

force and efficacy. That the American flag is grossly abused by the

abandoned and profligate of other nations is but too probable. Congress has

not long since had this subject under its consideration, and its importance

well justifies renewed and anxious attention.

I also communicate herewith the copy of a correspondence between Mr.

Stevenson and Lord Palmerston upon the subject, so interesting to several

of the Southern States, of the rice duties, which resulted honorably to the

justice of Great Britain and advantageously to the United States.

At the opening of the last annual session the President informed Congress

of the progress which had then been made in negotiating a convention

between this Government and that of England with a view to the final

settlement of the question of the boundary between the territorial limits

of the two countries. I regret to say that little further advancement of

the object has been accomplished since last year, but this is owing to

circumstances no way indicative of any abatement of the desire of both

parties to hasten the negotiation to its conclusion and to settle the

question in dispute as early as possible. In the course of the session it

is my hope to be able to announce some further degree of progress toward

the accomplishment of this highly desirable end.

The commission appointed by this Government for the exploration and survey

of the line of boundary separating the States of Maine and New Hampshire

from the conterminous British Provinces is, it is believed, about to close

its field labors and is expected soon to report the results of its

examinations to the Department of State. The report, when received, will be

laid before Congress.

The failure on the part of Spain to pay with punctuality the interest due

under the convention of 1834 for the settlement of claims between the two

countries has made it the duty of the Executive to call the particular

attention of that Government to the subject. A disposition has been

manifested by it, which is believed to be entirely sincere, to fulfill its

obligations in this respect so soon as its internal condition and the state

of its finances will permit. An arrangement is in progress from the result

of which it is trusted that those of our citizens who have claims under the

convention will at no distant day receive the stipulated payments.

A treaty of commerce and navigation with Belgium was concluded and signed

at Washington on the 29th of March, 1840, and was duly sanctioned by the

Senate of the United States. The treaty was ratified by His Belgian

Majesty, but did not receive the approbation of the Belgian Chambers within

the time limited by its terms, and has therefore become void.

This occurrence assumes the graver aspect from the consideration that in

1833 a treaty negotiated between the two Governments and ratified on the

part of the United States failed to be ratified on the part of Belgium. The

representative of that Government at Washington informs the Department of

State that he has been instructed to give explanations of the causes which

occasioned delay in the approval of the late treaty by the legislature, and

to express the regret of the King at the occurrence.

The joint commission under the convention with Texas to ascertain the true

boundary between the two countries has concluded its labors, but the final

report of the commissioner of the United States has not been received. It

is understood, however, that the meridian line as traced by the commission

lies somewhat farther east than the position hitherto generally assigned to

it, and consequently includes in Texas some part of the territory which had

been considered as belonging to the States of Louisiana and Arkansas.

The United States can not but take a deep interest in whatever relates to

this young but growing Republic. Settled principally by emigrants from the

United States, we have the happiness to know that the great principles of

civil liberty are there destined to flourish under wise institutions and

wholesome laws, and that through its example another evidence is to be

afforded of the capacity of popular institutions to advance the prosperity,

happiness, and permanent glory of the human race. The great truth that

government was made for the people and not the people for government has

already been established in the practice and by the example of these United

States, and we can do no other than contemplate its further exemplification

by a sister republic with the deepest interest.

Our relations with the independent States of this hemisphere, formerly

under the dominion of Spain, have not undergone any material change within

the past year. The incessant sanguinary conflicts in or between those

countries are to be greatly deplored as necessarily tending to disable them

from performing their duty as members of the community of nations and

rising to the destiny which the position and natural resources of many of

them might lead them justly to anticipate, as constantly giving occasion

also, directly or indirectly, for complaints on the part of our citizens

who resort thither for purposes of commercial intercourse, and as retarding

reparation for wrongs already committed, some of which are by no means of

recent date.

The failure of the Congress of Ecuador to hold a session at the time

appointed for that purpose, in January last, will probably render abortive

a treaty of commerce with that Republic, which was signed at Quito on the

13th of June, 1839, and had been duly ratified on our part, but which

required the approbation of that body prior to its ratification by the

Ecuadorian Executive.

A convention which has been concluded with the Republic of Peru, providing

for the settlement of certain claims of citizens of the United States upon

the Government of that Republic, will be duly submitted to the Senate.

The claims of our citizens against the Brazilian Government originating

from captures and other causes are still unsatisfied. The United States

have, however, so uniformly shown a disposition to cultivate relations of

amity with that Empire that it is hoped the unequivocal tokens of the same

spirit toward us which an adjustment of the affairs referred to would

afford will be given without further avoidable delay.

The war with the Indian tribes on the peninsula of Florida has during the

last summer and fall been prosecuted with untiring activity and zeal. A

summer campaign was resolved upon as the best mode of bringing it to a

close. Our brave officers and men who have been engaged in that service

have suffered toils and privations and exhibited an energy which in any

other war would have won for them unfading laurels. In despite of the

sickness incident to the climate, they have penetrated the fastnesses of

the Indians, broken up their encampments, and harassed them unceasingly.

Numbers have been captured, and still greater numbers have surrendered and

have been transported to join their brethren on the lands elsewhere

allotted to them by the Government, and a strong hope is entertained that

under the conduct of the gallant officer at the head of the troops in

Florida that troublesome and expensive war is destined to a speedy

termination. With all the other Indian tribes we are enjoying the blessings

of peace. Our duty as well as our best interests prompts us to observe in

all our intercourse with them fidelity in fulfilling our engagements, the

practice of strict justice, as well as the constant exercise of acts of

benevolence and kindness. These are the great instruments of civilization,

and through the use of them alone can the untutored child of the forest be

induced to listen to its teachings.

The Secretary of State, on whom the acts of Congress have devolved the duty

of directing the proceedings for the taking of the sixth census or

enumeration of the inhabitants of the United States, will report to the two

Houses the progress of that work. The enumeration of persons has been

completed, and exhibits a grand total of 17,069,453, making an increase

over the census of 1830 of 4,202,646 inhabitants, and showing a gain in a

ratio exceeding 32 1/2 per cent for the last ten years.

From the report of the Secretary of the Treasury you will be informed of

the condition of the finances. The balance in the Treasury on the 1st of

January last, as stated in the report of the Secretary of the Treasury

submitted to Congress at the extra session, was $987,345.03. The receipts

into the Treasury during the first three quarters of this year from all

sources amount to $23,467,072.52; the estimated receipts for the fourth

quarter amount to $6,943,095.25, amounting to $30,410,167.77, and making

with the balance in the Treasury on the 1st of January last $31,397,512.80.

The expenditures for the first three quarters of this year amount to

$24,734,346.97. The expenditures for the fourth quarter as estimated will

amount to $7,290,723.73, thus making a total of $32,025,070.70, and leaving

a deficit to be provided for on the 1st of January next of about

$627,557.90.

Of the loan of $12,000,000 which was authorized by Congress at its late

session only $5,432,726.88 have been negotiated. The shortness of time

which it had to run has presented no inconsiderable impediment in the way

of its being taken by capitalists at home, while the same cause would have

operated with much greater force in the foreign market. For that reason the

foreign market has not been resorted to; and it is now submitted whether it

would not be advisable to amend the law by making what remains undisposed

of payable at a more distant day.

Should it be necessary, in any view that Congress may take of the subject,

to revise the existing tariff of duties, I beg leave to say that in the

performance of that most delicate operation moderate counsels would seem to

be the wisest. The Government under which it is our happiness to live owes

its existence to the spirit of compromise which prevailed among its

framers; jarring and discordant opinions could only have been reconciled by

that noble spirit of patriotism which prompted conciliation and resulted in

harmony. In the same spirit the compromise bill, as it is commonly called,

was adopted at the session of 1833. While the people of no portion of the

Union will ever hesitate to pay all necessary taxes for the support of

Government, yet an innate repugnance exists to the imposition of burthens

not really necessary for that object. In imposing duties, however, for the

purposes of revenue a right to discriminate as to the articles on which the

duty shall be laid, as well as the amount, necessarily and most properly

exists; otherwise the Government would be placed in the condition of having

to levy the same duties upon all articles, the productive as well as the

unproductive. The slightest duty upon some might have the effect of causing

their importation to cease, whereas others, entering extensively into the

consumption of the country, might bear the heaviest without any sensible

diminution in the amount imported. So also the Government may be justified

in so discriminating by reference to other considerations of domestic

policy connected with our manufactures. So long as the duties shall be laid

with distinct reference to the wants of the Treasury no well-rounded

objection can exist against them. It might be esteemed desirable that no

such augmentation of the taxes should take place as would have the effect

of annulling the land-proceeds distribution act of the last session, which

act is declared to be inoperative the moment the duties are increased

beyond 20 per cent, the maximum rate established by the compromise act.

Some of the provisions of the compromise act, which will go into effect on

the 30th day of June next, may, however, be found exceedingly inconvenient

in practice under any regulations that Congress may adopt. I refer more

particularly to that relating to the home valuation. A difference in value

of the same articles to some extent will necessarily exist at different

ports, but that is altogether insignificant when compared with the

conflicts in valuation which are likely to arise from the differences of

opinion among the numerous appraisers of merchandise. In many instances the

estimates of value must be conjectural, and thus as many different rates of

value may be established as there are appraisers. These differences in

valuation may also be increased by the inclination which, without the

slightest imputation on their honesty, may arise on the part of the

appraisers in favor of their respective ports of entry. I recommend this

whole subject to the consideration of Congress with a single additional

remark. Certainty and permanency in any system of governmental policy are

in all respects eminently desirable, but more particularly is this true in

all that affects trade and commerce, the operations of which depend much

more on the certainty of their returns and calculations which embrace

distant periods of time than on high bounties or duties, which are liable

to constant fluctuations.

At your late session I invited your attention to the condition of the

currency and exchanges and urged the necessity of adopting such measures as

were consistent with the constitutional competency of the Government in

order to correct the unsoundness of the one and, as far as practicable, the

inequalities of the other. No country can be in the enjoyment of its full

measure of prosperity without the presence of a medium of exchange

approximating to uniformity of value. What is necessary as between the

different nations of the earth is also important as between the inhabitants

of different parts of the same country. With the first the precious metals

constitute the chief medium of circulation, and such also would be the case

as to the last but for inventions comparatively modern, which have

furnished in place of gold and silver a paper circulation. I do not propose

to enter into a comparative analysis of the merits of the two systems. Such

belonged more properly to the period of the introduction of the paper

system. The speculative philosopher might find inducements to prosecute the

inquiry, but his researches could only lead him to conclude that the paper

system had probably better never have been introduced and that society

might have been much happier without it. The practical statesman has a very

different task to perform. He has to look at things as they are, to take

them as he finds them, to supply deficiencies and to prune excesses as far

as in him lies. The task of furnishing a corrective for derangements of the

paper medium with us is almost inexpressibly great. The power exerted by

the States to charter banking corporations, and which, having been carried

to a great excess, has filled the country with, in most of the States, an

irredeemable paper medium, is an evil which in some way or other requires a

corrective. The rates at which bills of exchange are negotiated between

different parts of the country furnish an index of the value of the local

substitute for gold and silver, which is in many parts so far depreciated

as not to be received except at a large discount in payment of debts or in

the purchase of produce. It could earnestly be desired that every bank not

possessing the means of resumption should follow the example of the late

United States Bank of Pennsylvania and go into liquidation rather than by

refusing to do so to continue embarrassments in the way of solvent

institutions, thereby augmenting the difficulties incident to the present

condition of things. Whether this Government, with due regard to the rights

of the States, has any power to constrain the banks either to resume specie

payments or to force them into liquidation, is an inquiry which will not

fail to claim your consideration. In view of the great advantages which are

allowed the corporators, not among the least of which is the authority

contained in most of their charters to make loans to three times the amount

of their capital, thereby often deriving three times as much interest on

the same amount of money as any individual is permitted by law to receive,

no sufficient apology can be urged for a long-continued suspension of

specie payments. Such suspension is productive of the greatest detriment to

the public by expelling from circulation the precious metals and seriously

hazarding the success of any effort that this Government can make to

increase commercial facilities and to advance the public interests.

This is the more to be regretted and the indispensable necessity for a

sound currency becomes the more manifest when we reflect on the vast amount

of the internal commerce of the country. Of this we have no statistics nor

just data for forming adequate opinions. But there can be no doubt but that

the amount of transportation coastwise by sea, and the transportation

inland by railroads and canals, and by steamboats and other modes of

conveyance over the surface of our vast rivers and immense lakes, and the

value of property carried and interchanged by these means form a general

aggregate to which the foreign commerce of the country, large as it is,

makes but a distant approach.

In the absence of any controlling power over this subject, which, by

forcing a general resumption of specie payments, would at once have the

effect of restoring a sound medium of exchange and would leave to the

country but little to desire, what measure of relief falling within the

limits of our constitutional competency does it become this Government to

adopt? It was my painful duty at your last session, under the weight of

most solemn obligations, to differ with Congress on the measures which it

proposed for my approval, and which it doubtless regarded as corrective of

existing evils. Subsequent reflection and events since occurring have only

served to confirm me in the opinions then entertained and frankly

expressed. I must be permitted to add that no scheme of governmental policy

unaided by individual exertions can be available for ameliorating the

present condition of things. Commercial modes of exchange and a good

currency are but the necessary means of commerce and intercourse, not the

direct productive sources of wealth. Wealth can only be accumulated by the

earnings of industry and the savings of frugality, and nothing can be more

ill judged than to look to facilities in borrowing or to a redundant

circulation for the power of discharging pecuniary obligations. The country

is full of resources and the people fall of energy, and the great and

permanent remedy for present embarrassments must be sought in industry,

economy, the observance of good faith, and the favorable influence of time.

In pursuance of a pledge given to you in my last message to Congress, which

pledge I urge as an apology for adventuring to present you the details of

any plan, the Secretary of the Treasury will be ready to submit to you,

should you require it, a plan of finance which, while it throws around the

public treasure reasonable guards for its protection and rests on powers

acknowledged in practice to exist from the origin of the Government, will

at the same time furnish to the country a sound paper medium and afford all

reasonable facilities for regulating the exchanges. When submitted, you

will perceive in it a plan amendatory of the existing laws in relation to

the Treasury Department, subordinate in all respects to the will of

Congress directly and the will of the people indirectly, self-sustaining

should it be found in practice to realize its promises in theory, and

repealable at the pleasure of Congress. It proposes by effectual restraints

and by invoking the true spirit of our institutions to separate the purse

from the sword, or, more properly to speak, denies any other control to the

President over the agents who may be selected to carry it into execution

but what may be indispensably necessary to secure the fidelity of such

agents, and by wise regulations keeps plainly apart from each other private

and public funds. It contemplates the establishment of a board of control

at the seat of government, with agencies at prominent commercial points or

wherever else Congress shall direct, for the safe-keeping and disbursement

of the public moneys and a substitution at the option of the public

creditor of Treasury notes in lieu of gold and silver. It proposes to limit

the issues to an amount not to exceed $15,000,000 without the express

sanction of the legislative power. It also authorizes the receipt of

individual deposits of gold and silver to a limited amount, and the

granting certificates of deposit divided into such sums as may be called

for by the depositors. It proceeds a step further and authorizes the

purchase and sale of domestic bills and drafts resting on a real and

substantial basis, payable at sight or having but a short time to run, and

drawn on places not less than 100 miles apart, which authority, except in

so far as may be necessary for Government purposes exclusively, is only to

be exerted upon the express condition that its exercise shall not be

prohibited by the State in which the agency is situated. In order to cover

the expenses incident to the plan, it will be authorized to receive

moderate premiums for certificates issued on deposits and on bills bought

and sold, and thus, as far as its dealings extend, to furnish facilities to

commercial intercourse at the lowest possible rates and to subduct from the

earnings of industry the least possible sum. It uses the State banks at a

distance from the agencies as auxiliaries without imparting any power to

trade in its name. It is subjected to such guards and restraints as have

appeared to be necessary. It is the creature of law and exists only at the

pleasure of the Legislature. It is made to rest on an actual specie basis

in order to redeem the notes at the places of issue, produces no dangerous

redundancy of circulation, affords no temptation to speculation, is

attended by no inflation of prices, is equable in its operation, makes the

Treasury notes (which it may use along with the certificates of deposit and

the notes of specie-paying banks) convertible at the place where collected,

receivable in payment of Government dues, and without violating any

principle of the Constitution affords the Government and the people such

facilities as are called for by the wants of both. Such, it has appeared to

me, are its recommendations, and in view of them it will be submitted,

whenever you may require it, to your consideration.

I am not able to perceive that any fair and candid objection can be urged

against the plan, the principal outlines of which I have thus presented. I

can not doubt but that the notes which it proposes to furnish at the

voluntary option of the public creditor, issued in lieu of the revenue and

its certificates of deposit, will be maintained at an equality with gold

and silver everywhere. They are redeemable in gold and silver on demand at

the places of issue. They are receivable everywhere in payment of

Government dues. The Treasury notes are limited to an amount of one-fourth

less than the estimated annual receipts of the Treasury, and in addition

they rest upon the faith of the Government for their redemption. If all

these assurances are not sufficient to make them available, then the idea,

as it seems to me, of furnishing a sound paper medium of exchange may be

entirely abandoned.

If a fear be indulged that the Government may be tempted to run into excess

in its issues at any future day, it seems to me that no such apprehension

can reasonably be entertained until all confidence in the representatives

of the States and of the people, as well as of the people themselves, shall

be lost. The weightiest considerations of policy require that the

restraints now proposed to be thrown around the measure should not for

light causes be removed. To argue against any proposed plan its liability

to possible abuse is to reject every expedient, since everything dependent

on human action is liable to abuse. Fifteen millions of Treasury notes may

be issued as the maximum, but a discretionary power is to be given to the

board of control under that sum, and every consideration will unite in

leading them to feel their way with caution. For the first eight years of

the existence of the late Bank of the United States its circulation barely

exceeded $4,000,000, and for five of its most prosperous years it was about

equal to $16,000,000; furthermore, the authority given to receive private

deposits to a limited amount and to issue certificates in such sums as may

be called for by the depositors may so far fill up the channels of

circulation as greatly to diminish the necessity of any considerable issue

of Treasury notes. A restraint upon the amount of private deposits has

seemed to be indispensably necessary from an apprehension, thought to be

well founded, that in any emergency of trade confidence might be so far

shaken in the banks as to induce a withdrawal from them of private deposits

with a view to insure their unquestionable safety when deposited with the

Government, which might prove eminently disastrous to the State banks. Is

it objected that it is proposed to authorize the agencies to deal in bills

of exchange? It is answered that such dealings are to be carried on at the

lowest possible premium, are made to rest on an unquestionably sound basis,

are designed to reimburse merely the expenses which would otherwise devolve

upon the Treasury, and are in strict subordination to the decision of the

Supreme Court in the case of the Bank of Augusta against Earle, and other

reported cases, and thereby avoids all conflict with State jurisdiction,

which I hold to be indispensably requisite. It leaves the banking

privileges of the States without interference, looks to the Treasury and

the Union, and while furnishing every facility to the first is careful of

the interests of the last. But above all, it is created by law, is

amendable by law, and is repealable by law, and, wedded as I am to no

theory, but looking solely to the advancement of the public good, I shall

be among the very first to urge its repeal if it be found not to subserve

the purposes and objects for which it may be created. Nor will the plan be

submitted in any overweening confidence in the sufficiency of my own

judgment, but with much greater reliance on the wisdom and patriotism of

Congress. I can not abandon this subject without urging upon you in the

most emphatic manner, whatever may be your action on the suggestions which

I have felt it to be my duty to submit, to relieve the Chief Executive

Magistrate, by any and all constitutional means, from a controlling power

over the public Treasury. If in the plan proposed, should you deem it

worthy of your consideration, that separation is not as complete as you may

desire, you will doubtless amend it in that particular. For myself, I

disclaim all desire to have any control over the public moneys other than

what is indispensably necessary to execute the laws which you may pass.

Nor can I fail to advert in this connection to the debts which many of the

States of the Union have contracted abroad and under which they continue to

labor. That indebtedness amounts to a sum not less than $200,000,000, and

which has been retributed to them for the most part in works of internal

improvement which are destined to prove of vast importance in ultimately

advancing their prosperity and wealth. For the debts thus contracted the

States are alone responsible. I can do not more than express the belief

that each State will feel itself bound by every consideration of honor as

well as of interest to meet its engagements with punctuality. The failure,

however, of any one State to do so should in no degree affect the credit of

the rest, and the foreign capitalist will have no just cause to experience

alarm as to all other State stocks because any one or more of the States

may neglect to provide with punctuality the means of redeeming their

engagements. Even such States, should there be any, considering the great

rapidity with which their resources are developing themselves, will not

fail to have the means at no very distant day to redeem their obligations

to the uttermost farthing; nor will I doubt but that, in view of that

honorable conduct which has evermore governed the States and the people of

the Union, they will each and all resort to every legitimate expedient

before they will forego a faithful compliance with their obligations.

From the report of the Secretary of War and other reports accompanying it

you will be informed of the progress which has been made in the

fortifications designed for the protection of our principal cities,

roadsteads, and inland frontier during the present year, together with

their true state and condition. They will be prosecuted to completion with

all the expedition which the means placed by Congress at the disposal of

the Executive will allow.

I recommend particularly to your consideration that portion of the

Secretary's report which proposes the establishment of a chain of military

posts from Council Bluffs to some point on the Pacific Ocean within our

limits. The benefit thereby destined to accrue to our citizens engaged in

the fur trade over that wilderness region, added to the importance of

cultivating friendly relations with savage tribes inhabiting it, and at the

same time of giving protection to our frontier settlements and of

establishing the means of safe intercourse between the American settlements

at the mouth of the Columbia River and those on this side of the Rocky

Mountains, would seem to suggest the importance of carrying into effect the

recommendations upon this head with as little delay as may be practicable.

The report of the Secretary of the Navy will place you in possession of the

present condition of that important arm of the national defense. Every

effort will be made to add to its efficiency, and I can not too strongly

urge upon you liberal appropriations to that branch of the public service.

Inducements of the weightiest character exist for the adoption of this

course of policy. Our extended and otherwise exposed maritime frontier

calls for protection, to the furnishing of which an efficient naval force

is indispensable. We look to no foreign conquests, nor do we propose to

enter into competition with any other nation for supremacy on the ocean;

but it is due not only to the honor but to the security of the people of

the United States that no nation should be permitted to invade our waters

at pleasure and subject our towns and villages to conflagration or pillage.

Economy in all branches of the public service is due from all the public

agents to the people, but parsimony alone would suggest the withholding of

the necessary means for the protection of our domestic firesides from

invasion and our national honor from disgrace. I would most earnestly

recommend to Congress to abstain from all appropriations for objects not

absolutely necessary; but I take upon myself, without a moment of

hesitancy, all the responsibility of recommending the increase and prompt

equipment of that gallant Navy which has lighted up every sea with its

victories and spread an imperishable glory over the country.

The report of the Postmaster-General will claim your particular attention,

not only because of the valuable suggestions which it contains, but because

of the great importance which at all times attaches to that interesting

branch of the public service. The increased expense of transporting the

mail along the principal routes necessarily claims the public attention,

and has awakened a corresponding solicitude on the part of the Government.

The transmission of the mail must keep pace with those facilities of

intercommunication which are every day becoming greater through the

building of railroads and the application of steam power, but it can not be

disguised that in order to do so the Post-Office Department is subjected to

heavy exactions. The lines of communication between distant parts of the

Union are to a great extent occupied by railroads, which, in the nature of

things, possess a complete monopoly, and the Department is therefore liable

to heavy and unreasonable charges. This evil is destined to great increase

in future, and some timely measure may become necessary to guard against

it.

I feel it my duty to bring under your consideration a practice which has

grown up in the administration of the Government, and which, I am deeply

convinced, ought to be corrected. I allude to the exercise of the power

which usage rather than reason has vested in the Presidents of removing

incumbents from office in order to substitute others more in favor with the

dominant party. My own conduct in this respect has been governed by a

conscientious purpose to exercise the removing power only in cases of

unfaithfulness or inability, or in those in which its exercise appeared

necessary in order to discountenance and suppress that spirit of active

partisanship on the part of holders of office which not only withdraws them

from the steady and impartial discharge of their official duties, but

exerts an undue and injurious influence over elections and degrades the

character of the Government itself, inasmuch as it exhibits the Chief

Magistrate as being a party through his agents in the secret plots or open

workings of political parties.

In respect to the exercise of this power nothing should be left to

discretion which may safely be regulated by law, and it is of high

importance to restrain as far as possible the stimulus of personal

interests in public elections. Considering the great increase which has

been made in public offices in the last quarter of a century and the

probability of further increase, we incur the hazard of witnessing violent

political contests, directed too often to the single object of retaining

office by those who are in or obtaining it by those who are out. Under the

influence of these convictions I shall cordially concur in any

constitutional measure for regulating and, by regulating, restraining the

power of removal.

I suggest for your consideration the propriety of making without further

delay some specific application of the funds derived under the will of Mr.

Smithson, of England, for the diffusion of knowledge, and which have

heretofore been vested in public stocks until such time as Congress should

think proper to give them a specific direction. Nor will you, I feel

confident, permit any abatement of the principal of the legacy to be made

should it turn out that the stocks in which the investments have been made

have undergone a depreciation.

In conclusion I commend to your care the interests of this District, for

which you are the exclusive legislators. Considering that this city is the

residence of the Government and for a large part of the year of Congress,

and considering also the great cost of the public buildings and the

propriety of affording them at all times careful protection, it seems not

unreasonable that Congress should contribute toward the expense of an

efficient police.

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