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asserted by the American Government, and forming part of its most cherished policy. The Government decided, therefore, that the four persons in question would be "cheerfully liberated." This decision, sustained by the reasoning advanced in its support, commanded the immediate and universal acquiescence of the American people; while in England it was received with hearty applause by the friends of this country, especially as it silenced the clamors and disappointed the hostile hopes of its enemies. The French Government had joined that of England in its representations upon this subject, and the decision of our Government was received there with equal satisfaction. The effect of the incident, under the just and judicious course adopted by the Administration, was eminently favorable to the United States, increasing the general respect for its adherence to sound principles of public law, and silencing effectually the slander that its Government was too weak to disappoint or thwart a popular clamor. One of the immediate fruits of the discussion was the prompt rejection of all demands for recognizing the independence of the Confederate States.
THE REGULAR SESSION OF CONGRESS, DEC. 1861.--THE MES
BAGE. DEBATES, ETC.
CONGRESS met in regular session (the second of the thirtyseventh Congress) on the 2d of December, 1861. On the next day the President sent in his Annual Message, as follows:
FELLOW-CITIZENS OF THE SENATE AND HOUSE OF REPRESENTATIVES:
In the midst of unprecedented political troubles, we have cause of great gratitude to God for unusual good health, and most abundant harvests.
You will not be surprised to learn that, in the peculiar exigencies of the times, our intercourse with foreign nations has been attended with profound solicitude, chiefly turning upon our own domestic affairs.
A disloyal portion of the American people have, during the whole year, been engaged in an attempt to divide and destroy the Union. A nation which endures factious domestic division, is exposed to disrespect abroad; and one party, if not both, is sure, sooner or later, to invoke foreign intervention.
Nations thus tempted to interfere are not always able to resist the counsels of seeming expediency and ungenerous ambition, although measures adopted under such influences seldom fail to be unfortunate and injurious to those adopting them.
The disloyal citizens of the United States who have offered the ruin of our country, in return for the aid and comfort which they have invoked abroad, have received less patronage and encouragement than they probably expected. If it were just to suppose, as the insurgents have seemed to assume, that foreign nations, in this case, discarding all moral, social, and treaty obligations, would act solely and selfishly for the most speedy restoration of commerce, including especially the acquisition of cotton, those nations appear, as yet, not to have seen their way to their object more directly, or clearly, through the destruction, than through the preservation, of the Union. If we could dare to believe that foreign nations are actuated by no higher principle than this, I am quite sure a sound argument could be made to show them that they can reach their aim more readily and easily by aiding to crush this rebellion, than by giving encouragement to it.
The principal lever relied on by the insurgents for exciting foreign nations to hostility against us, as already intimated, is the embarrassment of commerce. Those nations, however, not improbably, saw from the first, that it was the Union which made, as well our foreign as our domestic commerce. They can scarcely have failed to perceive that the effort for disunion produced the existing difficulty; and that one strong nation promises more durable peace, and a more extensive, valuable, and reliable commerce, than can the same nation broken into hostile fragments.
It is not my purpose to review our discussions with foreign States; because whatever might be their wishes or dispositions, the integrity of our country and the stability of our Government mainly depend, not upon them, but on the loyalty, virtue, patriotism, and intelligence of the American people. The correspondence itself, with the usual reservations, is herewith submitted.
I venture to hope it will appear that we have practised prudence and liberality towards foreign powers, averting causes of irritation; and with firmness maintaining our own rights and honor.
Since, however, it is apparent that here, as in every other State, foreign dangers necessarily attend domestic difficulties, I recommend that adequate and ample measures be adopted for maintaining the public defences on every side. While, under this general recommendation, provision for defending our sea-coast line readily occurs to the mind, I also, in the same connection, ask the attention of Congress to our great lakes and rivers. It is believed that some fortifications and dépôts of arms and munitions, with harbor and navigation improvements, all at wellselected points upon these, would be of great importance to the national defence and preservation. I ask attention to the views of the Secretary of War, expressed in his report upon the same general subject.
I deem it of importance that the loyal regions of East Tennessee ani Western North Carolina should be connected with Kentucky and otlier faithful parts of the Union by railroad. I, therefore, recommend, as a military measure, that Congress provide for the construction of such road as speedily as possible.
Kentucky will no doubt co-operate, and, through her Legislature, make the most judicious selection of a line.' The northern terminus must connect with some existing railroad, and whether the route shall
be from Lexington or Nicholasville to the Cumberland Gap, or from Lebanon to the Tennessee line, in the direction of Knoxville, or on soine still different line, can easily be determined. Kentucky and the General Government co-operating, the work can be completed in a very short time, and when done it will be not only of vast present usefulness, but also a valuable permanent improvement worth its cost in all the future.
Some treaties, designed chiefly for the interests of commerce, and having no grave political importance, have been negotiated, and will be submitted to the Senate for their consideration. Although we have failed to induce some of the commercial Powers to adopt a desirable melioration of the rigor of maritime war, we have removed all obstructions from the way of this humane reform, except such as are merely of temporary and accidental occurrence.
I invite your attention to the correspondence between her Britaunic Majesty's Minister, accredited to this Government, and the Secretary of State, relative to the detention of the British ship Perthshire in June last by the United States steamer Massachusetts, for a supposed breach of the blockade. As this detention was occasioned by an obvious mis. apprehension of the facts, and as justice requires that we should commit no belligerent act not founded in strict right as sanctioned by public law, I recommend that an appropriation be made to satisfy the reason. able demand of the owners of the vessel for her detention.
I repeat the recommendation of my predecessor in his annual messago to Congress in December last in regard to the disposition of the surplus which will probably remain after satisfying the claims of American citizens against China, pursuant to the awards of the commissioners under the act of the 3d of March, 1859.
If, however, it should not be deemed advisable to carry that recommendation into effect, I would suggest that authority be given for investing the principal over the proceeds of the surplus referred to in good securities, with a view to the satisfaction of such other just claim of our citizens against China as are not unlikely to arise hereafter in the course of our extensive trade with that Empire.
By the act of the 5th of August last, Congress authorized the President to instruct the commanders of suitable vessels to defend themselves against and to capture pirates. This authority has been exercised in a single instance only.
For the more effectual protection of our extensive and valuable commerce in the Eastern seas, especially, it seems to me that it would also be advisable to authorize the commandors of sailing-vessels to recapture any prizes which pirates may make of the United States vessels and their cargoes, and the Consular Courts established by law in Eastery countries to adjudicate the cases in the event that this should not be objected to by the local authorities.
If any good reason exists why we should persevere longer in withholding our recognition of the independence and sovereignty of Hayti and Liberia, I am unable to discern 'it. Unwilling, however, to inaugurate a novel policy in regard to them without the approbation of Congress, I submit for your consideration the expediency of an appropriation for maintaining a Chargé d'Afaires near each of those new States. It does not admit of doubt that important commercial advantages might be secured by favorable treaties with them.
The operations of the Treasury during the period which has elapsed since your adjournment have been conducted with signal success. The patriotism of the people has placed at the disposal of the Government the large means demanded by the public exigencies. Much of the national loan has been taken by citizens of the industrial classes, whose confidence in their country's faith, and zeal for their country's deliverance from its present peril, have induced them to contribute to the support of the Government the whole of their limited acquisitions. This fact imposes peculiar obligations to economy and disbursement and energy in action. The revenue from all sources, including loans for the financial year ending on the 30th of June, 1361, was $86,835,900 27; and the expenditures for the same period, including payments on account of the public debt, were $84,578,034 47, leaving a balance in the treasury, on the 1st of July, of $2,257,065 80 for the first quarter of the financial year ending on September 30, 1861. The receipts from all sources, including the balance of July 1, were $102,532,509 27, and the expenses $98,239,733 09, leaving a balance, on the 1st of October, 1861, of $4,292,776 18.
Estimates for the remaining three-quarters of the year and for the financial year of 1863, together with his views of the ways and means for meeting the demands contemplated by them, will be submitted to Congress by the Secretary of the Treasury. It is gratifying to know that the expenses made necessary by the rebellion are not beyond the resources of the loyal people, and to believe that the same patriotism which has thus far sustained the Government will continue to sustain it till peace and union shall again bless the land. I respectfully refer to the report of the Secretary of War for informåtion respecting the numerical strength of the army, and for recommendations having in