nine vessels, with one thousand three hundred and forty-six guns, of which forty-two, carrying five hundred and fifty-six guns, were in commission. Of the sixty-nine available vessels, the Levant was lost in the Pacific, the steamer Fulton was seized at Pensacola, and one frigate, two sloops, and a brig were burned at Norfolk. The other vessels destroyed there were considered worthless. There remained sixty-three, of which fifty-nine were put in commission. In addition to which, nine steamers were chartered, and twelve steamers and three sailing vessels were purchased, making an entire force of eighty-two vessels and eleven hundred guns. On the Atlantic coast, the blockading squadron, twenty-two vessels, with two hundred and ninety guns and three thousand three hundred men, was under the command of flagofficer Stringham. The Gulf squadron, consisting of twenty-one vessels, with two hundred and eighty-two guns and three thousand five hundred men, was under flag-officer Mervine. The East Indian, Mediterranean, Brazil, and African squadrons were recalled, adding two hundred guns and two thousand five hundred men for home service. Since the accession of Mr. Lincoln, two hundred and fifty-nine naval officers had resigned. The department, he added, had contracted for the building of twenty-three steam gunboats of five hundred tons each, to be followed by larger and fleeter vessels. The eight vessels ordered by the preceding Congress were being rapidly pushed to completion. The Secretary of the Treasury put forth a statement of the financial wants of the Government. He stated that the estimates of the year required $319,000,000; that $80,000,000 of this, or the amount required for the ordinary expenses, should be raised by taxation, and that $240,000,000 must be borrowed. He proposed an increase of the duties, which he estimated would raise the customs to $57,000,000, and he estimated that the public lands would give $3,000,000. He advised a tax on real and personal estate, to make up the remaining $20,000,000; also a reduction of forty per cent. on all salaries. To raise the $240,000,000 which must be borrowed, he proposed a national loan of $100,000,000, in small bonds, bearing 7.30 per cent. interest per annum, and redeemable after three years; a loan of $100,000,000, at seven per cent. in stock, payable after thirty years, in London; and the issue of $50,000,000 in $10 and $20 notes, bearing 3.65 per cent. interest, payable in one year, or without interest payable in coin on demand. Through these reports the military and financial condition of the country was laid before Congress. The leading measures of the session were promptly brought forward. In the Senate, the chairman of the military committee introduced six bills. The first was designed to ratify what the President had done on his own responsibility; the second, "to authorize the employment of volunteers to aid in enforcing the laws;" the third, to "increase the present military establishment of the United States; the fourth, "for the better organization of the military establishment of the United States; the fifth, "for the organization of a volunteer militia force, to be called the National Guard of the United States;" and the sixth to promote the efficiency of the army. These bills were discussed at considerable length in both houses. The opposition to them in the Senate came principally from Messrs. Breckinridge, of Kentucky, and Polk, of Missouri, both of whom, in the autumn of 1861, went over to the rebels, and accepted military commands under them; and in the House from Mr. Burnett, of Kentucky, who also seceded to the rebels a short time after the close of the session, and his friend, Mr. Vallandigham, of Ohio. The approval of the action of the President, which it was first proposed to make in the form of a resolution, was finally passed as a clause of one of the military bills, and Congress showed its hearty concurrence in his views in regard to the prosecution of the war by voting almost unanimously 500,000, instead of 400,000 men. On the 22d of July, Mr. Crittenden, of Kentucky, in the House, and, on the 26th, Mr. Johnson, of Tennessee, in the Senate, moved the following resolution: Resolved, That the present deplorable civil war has been forced upon the country by the disunionists of the Southern States, now in revolt against the constitutional Government, and in arms around the capital; that in this national emergency, Congress, banishing all feelings of mere passion or resentment, will recollect only its duty to the whole country; that this war is not waged on their part in any spirit of oppression, or for any purpose of conquest or subjugation, or purpose of overthrowing or interfering with the rights or established institutions of those States, but to defend and maintain the supremacy of the Constitution, and to preserve the Union with all the dignity, equality, and rights of the several States unimpaired; and that as soon as these objects are accomplished, the war ought to cease." This resolution passed the Senate by yeas thirty, nays five, and the House by yeas one hundred and seventeen, nays two. This declaration of the objects for which the war was prosecuted, offered by loyal citizens of the Border States, was cheerfully accorded by Congress, the great body of the members of which still clung to the idea that within a few months the people of the seceded States would gladly return to their allegiance. The duration of the war beyond the close of the year was not deemed possible. The Senate, on the 11th of July, expelled the senators James M. Mason and R. M. T. Hunter, of Virginia; Thomas L. Clingman and Thomas Bragg, of North Carolina; Louis T. Wigfall and J. W. Hemphill, of Texas; Charles B. Mitchell and William K. Sebastian, of Arkansas; and A. O. P. Nicholson, of Tennessee, all of whom were absent, having withdrawn on the secession of their respective States. The propriety of this course was so obvious that there was but very slight opposition to it. Mr. Bayard, of Delaware, and Mr. Latham, of California, urged the substitution of a resolution declaring their seats vacant, instead of expelling them, on the ground that they ought not personally to suffer for what was the result of the action of their States. But the fact of their full sympathy with and co-operation in the work of secession was so patent, that this view met with little support from the other senators. Messrs. Breckinridge and Polk voted against the resolution. The vote stood ayes thirty-two, noes ten. On the 13th of July, Mr. Johnson, of Tennessee, presented the credentials of Messrs. W. T. Willey and J. S. Carlile, elected senators of Vir ginia by the loyal legislature of that State, then in session at Wheeling. Their admission was objected to by Messrs. Bayard, of Delaware, and Powell, of Kentucky, but was defended by Mr. Johnson, of Tennessee, and others, and they were admitted by a vote of thirty-five yeas to five nays. Congress adjourned on the 6th of August, having been in session thirty-three days. In that period it passed sixty-one public acts, of which the most important were: 1st. To borrow $250,000,000 by the issue of bonds bearing interest at a rate not exceeding seven per cent., and irredeemable for twenty years; to issue seven and three-tenths per cent. treasury notes, payable. in three years, and United States notes, without interest, payable on demand, whence they were called demand notes, to the amount of $50,000,000; to levy a direct tax of $20,000,000; a tax upon incomes over $800; to increase the duties. 2d. To provide for collecting duties in disaffected States, and authorizing an embargo. 3d. To authorize the enlistment of five hundred thousand volun teers. 4th. To increase the pay of volunteers to $13 per month for privates; in lieu of clothing, $3 50 per month; rations, $9 per month. A bounty of $30 to soldiers who re-enlist for the war. If a company reenlist, $50 each; if a whole regiment, $75. 5th. To increase the regular army for the entire war; and within a year after the restoration of peace the number of men to be reduced to twenty-five thousand men, unless otherwise ordered by Congress. 6th. To authorize the President to call out the militia to execute the laws, when necessary. 7th. Appropriating $180,000,000 for the army, for the year 1962; $30,000,000 for the service of the navy; $3,000,000 to hire and purchase vessels. 8th. To define and punish conspiracies. If two or more persons in any State or Territory combine to overthrow the Government, or obstruct the execution of its laws, they shall be punished with fine and imprisonment. There was also passed at this session of Congress an act to confiscate property used for insurrectionary purposes, which provided that, in the present or any future insurrection, any property given to aid such insurrection, or used for that purpose with the knowledge and consent of the owner, should be subject to seizure and confiscation; that actions for the condemnation of such property might be brought in circuit, district, or admiralty courts having jurisdiction of the amount, and that the Attorney-General or any district attorney might institute proceedings, which in such case should be wholly for the bencfit of the United States; or any person might file an information with such attorney, in which case he should receive an equal share of the proceeds with the United States. In regard to slaves held by persons engaged in aiding the rebellion, the provisions of the bill were as follows: "That whenever hereafter, during the present insurrection against the Government of the United States, any person claimed to be held to labor or service, under the laws of any State, shall be required or permitted by the person to whom such labor or service is claimed to be due, or by the lawful agent of such person, to take up arms against the United States, or shall be required or permitted by the person to whom such service or labor is due, or by his lawful agent, to work or to be employed in or upon any fort, navy-yard, dock, armory, ship, or intrenchment, or in any military or naval service whatever, against the Government and lawful authority of the United States, then, and in every such case, the person to whom such service is claimed to be due, shall forfeit his claim to such labor, any law of the State or of the United States to the contrary notwithstanding; and whenever thereafter the person claiming such labor or service shall seek to enforce his claim, it shall be a full and sufficient answer to such claim, that the person whose service or labor is claimed had been employed in hostile service against the Government of the United States, contrary to the provisions of this act." This bill passed both branches of Congress. In the House the vote was-ayes, sixty; noes, forty-eight. The bill, it will be seen, limited within narrow bounds the confiscation of rebel property; it would have been more comprehensive (though probably not so sweeping as the confiscation law of 1862, for neither Congress nor the people were then ripe for that measure), but for the scruples which were entertained by some of the members in regard to the constitutionality of the confiscation of property for treason, without a previous trial and conviction of the traitor. These scruples, though honestly entertained, arose from the error of confounding the action against persons with the action against property, as was very clearly shown some months later by Hon. Henry Winter Davis, of Maryland, in a very elaborate published opinion on the subject. The action of Congress in making provision for a vigorous prosecution of the war, had greatly encouraged the people, and the enlistments were made with rapidity, and resulted in securing a very superior class of soldiers. There was, however, a pressing necessity for a large amount of financial resources to meet the heavy drain which the war was making on the national treasury. Fortunately for the nation, an accomplished and skilful financier was at the head of the treasury, a man capable of comprehending and providing for the emer gency. In December, 1860, when very few supposed war probable, Hon. Howell Cobb, Mr. Buchanan's Secretary of the Treasury, had offered $5,000,000 of United States treasury notes, payable one year from date, and had only received bids for $500,000 at twelve per cent. interest, and this when New York seven per cent. stocks were selling at 101. Secretary Chase needed to borrow by hundreds of millions, and that in the beginning of a great war of uncertain duration; but the capitalists had confidence in him and in the Government for which he acted, and though he had been bound very closely by Congress in regard to the terms on which the loans were to be made, and the amount to be derived from taxation did not promise to yield enough to pay the interest on the loans, he succeeded in negotiating for all the money he needed at an interest not exceeding an average of seven per cent. The loans at this time authorized by Congress were: Payable. 1. Bonds, Coupons, or Registered*.. After 20 years, sold not less than par.. 5. Treasury Notes.. ....At 3 years.. 6. Treasury Notes................At 1 year.. 7. Treasury Notes.. .In coin on demand, not less than $5.. No effort was made to negotiate a loan abroad, as the English capitalists were not inclined to invest in American securities. At a later date they purchased the bonds and treasury notes eagerly, and at a premium. Until he could make arrangements for the issue of his treasury notes at seven and three-tenths per cent., the Secretary obtained a loan for sixty days, on his twenty-year bonds as collateral, of $5,000,000. This sum was taken up in a single half-day in New York. Having visited Philadelphia, New York, and Boston, he succeeded in effecting an arrangement with the banks of the three cities, by which they took $50,000,000 of the seven-thirty notes at par, New York taking $35,000,000, Boston, $10,000,000, and Philadelphia, $5,000,000, the payments to be made about ten per cent. weekly, while interest was payable from the date of issue. The Secretary meantime was to open agencies throughout the country for subscriptions to the loan, and the money so received was to be paid over to the banks, for whose account these sales were made. The banks were to have the option of taking on similar terms two subsequent issues of the treasury notes, each of $50,000,000. The amount of subscriptions on the first issue, bearing date August 19th, 1861, was $38,000,000, leaving but $12,000,000 on the hands of the banks when they had paid in full for the first issue. They then took the second $50,000,000, which bore date October 1st, 1861; but the circulation of demand notes, and the great number of State loans in the market, causing for the time a falling off in the subscriptions for investment, they declined taking the third issue, and took in preference the twenty-year six per cent. stock at 89.322, which was equivalent to a seven per cent. stock at par. The whole subscription outside of banks and moneyed institutions for the seven-thirty treasury notes up to January 1st, 1862, somewhat exceeded $50,000,000. About $24,000,000 of demand notes had been issued up to that time, and $50,000,000 of twenty-year stock, from which there was realized $45,795,478 48. There had also been issued two-year notes (six per cents.) to the amount of $14,019,034 66, and borrowed on sixty-day six per cent. notes $12,877,750, making an aggregate of $197,242,588 14. Of the subsequent financial measures of *The difference between a registered stock and cospon bond is, that the former is inscribed up. on the books of the Government, in the name of the owner, and is transferred on the books by the owner to the party to whom he sells. The interest is paid to him in whose name the stock stands. The bond is not inscribed, but is transferred by delivery, like a bank note. It has attached to it small bonds, one for each six months' interest until the maturity of the bond itself. The holder cuts off the one due, and presents it for payment. These are called "coupons," from the French couper, to cut |