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Report of Postmaster-General.

“Fully aware of the delicacy, not to say the danger, of the subject, I commend to your careful consideration wbether this power of making judgments final may not properly be given to the court, reserving the right of appeal on questions of law to the Supreme Court, with such other provisions as experience may have shown to be necessary.

“I ask attention to the report of the Postmaster General, the following being a summary statement of the condition of the department:

The revenue from all sources during the fiscal year ending June 30th, 1861, including the annual permanent appropriation of seven hundred thousand dollars for the transportation of 'free mail matter,' was nine million forty-nine thousand two hundred and ninety-six dollars and forty cents, being about two per cent. less than the revenue for 1860.

“ The expenditures were thirteen million six hundred and six thousand seven hundred and fifty-nine dollars and eleven cents, showing a decrease of more than eight per cent. as compared with those of the previous year, and leaving an excess of expenditure over the revenue for the last fiscal year of four million five hundred and fifty-seven thousand four hundred and sixty-two dollars and seventy-one cents.

“The gross revenue for the year ending June 30th, 1863, is estimated at an increase of four per cent. on that of 1861, making eight million six hundred and eighty-three thousand dollars, to which should be added the earnings of the depart. ment in carrying free matter, viz: seven hundred thousand dollars, making nine million three hundred and eighty-three thousand dollars.

“ The total expenditures for 1863 are estimated at twelve million five hundred and twenty-eight thousand dollars, leaving an estimated deficiency of three million one hundred and forty-five thousand dollars to be supplied from the treasury. in addition to the permanent appropriation.

“ The present insurrection shows, I think, that the extension

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Interior Department.

Pension Office.

of this District across the Potomac river, at the time of establishing the capital here, was eminently wise, and consequently that the relinquishment of that portion of it which lies within the State of Virginia was unwise and dangerous. I submit for your consideration the expediency of regaining that part of the District, and the restoration of the original boundaries thereof, through negotiations with the state of Virginia.

“The report of the Secretary of the Interior, with the accompanying documents, exhibits the condition of the several branches of the public business pertaining to that department. The depressing influences of the insurrection have been specially felt in the operations of the Patent and General Land Offices. The cash receipts from the sales of public lands during the past year have exceeded the expenses of our land system only about two hundred thousand dollars. The sales have been entirely suspended in the Southern States, while the interruptions to the business of the country, and the diversions of large numbers of men from labor to military service, bave obstructed settlements in the new States and Territories of the North-west.

“ The receipts of the Patent Office have declined in nino months about one hundred thousand dollars, rendering a large reduction of the force employed necessary to make it selfsustaining

“ The demands upon the Pension Office will be largely increased by the insurrection. Numerous applications for pensions, based upon the casualties of the existing war, have already been made. There is reason to believe that many who are now upon the pension rolls, and in receipt of the bounty of the Government, are in the ranks of the insurgent army, or giving them aid and comfort. The Secretary of the Interior has directed a suspension of the payment of the pensions of such persons upon the proof of their disloyalty. I recommend that Congress authorize that officer to cause the names of such persons to be stricken from the pension rolls

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Indian Troubles.

Agricultural Burean

“ The relations of the Government with the Indian tribes have been greatly disturbed by the insurrection, especially in the Southern Superintendency and in that of New Mexico The Indian country south of Kansas is in the possession of insurgents from Texas and Arkansas. The agents of the United States appointed since the 4th of March for this superintendency have been unable to reach their posts, while the most of those who were in office before that time have espoused the insurrectionary cause, and assume to exercise the powers of agents by virtue of commissions from the insurrectionists. It has been stated in the public press that a portion of those Indians have been organized as a military force, and are attached to the army of the insurgents. Although the Government has no official information upon this subject, letters have been written to the Commissioner of Indian Affairs by several prominent chiefs, giving assurance of their loyalty to the United States, and expressing a wish for the presence of Federal troops to protect them. It is believed that upon the repossession of the country by the Federal forces the Indians will readily cease all hostile demonstrations, and resume their former relations to the Government.

“Agriculture, confessedly the largest interest of the nation, has not a department, nor a bureau, but a clerkship only, assigned to it in the Government. While it is fortunate that this great interest is so independent in its nature as to not have demanded and extorted more from the Government, I respectfully ask Congress to consider whether something more can not be given voluntarily with general advantage.

"Annual reports exhibiting the condition of our agriculture, commerce, and manufactures, would present a fund of information of great practical value to the country. While I make no suggestion as to details, I venture the opinion that an agricultural and statistical bureau might profitably be organized.

“The execution of the laws for the suppression of the

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Slave Trade.

New Territories,

African slave-trade has been confided to the Department of the Interior. It is a subject of gratulation that the efforts which have been made for the suppression of this inhuman traffic bave been recently attended with unusual success. Five vessels being fitted out for the slave-trade have been seized and condemned. Two mates of vessels engaged in the trade, and one person in equipping a vessel as a slaver, have been convicted and subjected to the penalty of fine and imprisonment, and one captain, taken with a cargo of Africans on board his vessel, has been convicted of the highest grade of offence under our laws, the punishment of which is death,

The Territories of Colorado, Dakota, and Nevada, created by the last Congress, have been organized, and civil administration has been inaugurated therein under auspices especially gratifying, when it is considered that the leaven of treason was found existing in some of these new countries when the Federal officers arrived there.

The abundant natural resources of these Territories, with the security and protection afforded by organized government, will doubtless invite to them a large immigration when peace sball restore the business of the country to its accustomed channels. I submit the resolutions of the Legislature of Colorado, which evidence the patriotic spirit of the people of the Territory. So far, the authority of the United States bas been upheld in all the Territories, as it is hoped it will be in the future. I commend their interests and defence to the enlightened and generous care of Congress.

“I recommend to the favorable consideration of Congress the interests of the District of Columbia. The insurrection has been the cause of much suffering and sacrifice to its inhabitants, and as they have no representative in Congress, that body should not overlook their just claims upon the Government.

“At your late session a joint resolution was adopted authorizing the President to take measures for facilitating a proper

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Confiscation Act.

Colonization,

representation of the industrial interests of the United States at the exhibition of the industry of all nations, to be bolden in London in the year 1862. I regret to say I have been unable to give personal attention to this subject-a subject at once so interesting in itself, and so extensively and intimately connected with the material prosperity of the world. Through the Secretaries of State and of the Interior a plan, or system, has been devised, and partly matured, and which will be laid before you.

“Under and by virtue of the act of Congress entitled 'An act to confiscate property used for insurrectionary purposes,' approved August 6, 1861, the legal claims of certain persons to the labor and service of certain other persons have become forfeited; and numbers of the latter, thus liberated, are already dependent on the United States, and must be provided for in some way. Besides this, it is not impossible that some of the States will pass similar enactments for their own benefit respectively, and by operation of which persons of the same class will be thrown upon them for disposal. In such case I recommend that Congress provide for accepting such persons from such States according to some mode of valuation, in lieu, pro tanto, of direct taxes, or upon some other plan to be agreed on with such States, respectively; that such persons, on such acceptance by the General Government, be at once deemed free; and, that, in any event, steps be taken for colonizing both classes (or the one first mentioned, if the other shall not be brought into existence) at some place or places in a climate congenial to them. It might be well to consider, too, whether the free colored people already in the United States could not, so far as individuals may desire, be included in such colonization.

“ To carry out the plan of colonization may involve the acquiring of territory, and also the appropriation of money beyond that to be expended in the territorial acquisition. Having practiced the acquisition of territory for nearly sixty

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