PUBLIC DOCUMENTS. 



715 



the way. I hold it the duty of the Executive to in- 

 sist upon a frugality in the expenditures ; and a 

 sparing economy is itself a great national resource. 

 Of the banks to which authority has been given to 

 issue notes secured by bonds of the United States, 

 we may require the greatest moderation and pru- 

 dence, and the law must be rigidly enforced when its 

 limits are exceeded. We may, each one of us, coun- 

 sel our active and enterprising countrymen to be con- 

 stantly on their guard, to liquidate debts contracted 

 in a paper currency, and, by conducting business as 

 nearly as possible on a system of cash payment or 

 short credits, to hold themselves prepared to return 

 to the standard of gold and silver. To aid our fellow- 

 citizens in the prudent management of their mone- 

 tary affairs, the duty devolves on us to diminish by 

 law the amount of paper money now in circulation. 

 Fire years ago the bank-note circulation of the coun- 

 try amounted to not much more than two hundred 

 millions; now the circulation, bank and national, 

 exceeds seven hundred millions. The simple state- 

 ment of the fact recommends more strongly than any 

 words of mine could do, the necessity of our restrain- 

 ing this expansion. The gradual reduction of the 

 currency is the only measure that can save the busi- 

 ness of the country from disastrous calamities ; and 

 this can be almost imperceptibly accomplished by 

 gradually funding the national circulation in securities 

 that may be made redeemable at the pleasure of the 

 Government. 



Our debt is doubly secure first in the actual 

 wealth and still greater undeveloped resources of the 

 country ; and next in the character of our institu- 

 tions. The most intelligent observers among politi- 

 cal economists have not failed to remark, that the 

 public debt of a country is safe in proportion as its 

 people are free ; that the debt of a republic is the 

 safest of all. Our history confirms and establishes 

 the theory, and is, I firmly believe, destined to give 

 it a still more signal illustration. The secret of this 

 superiority springs not merely from the fact that in 

 a republic the national obligations are distributed 

 more widely through countless numbers in all classes 

 of society ; it has its root in the character of our laws. 

 Here all men contribute to the public welfare, and 

 bear their fair share of the public burdens. During 

 the war, under the impulses of patriotism, the men 

 of the great body of the people, without regard to 

 their own comparative want of wealth, thronged to 

 our armies and filled our fleets of war, and held them- 

 selves ready to offer their lives for the public good. 

 Now, in their turn, the property and income of the 

 country should bear their just proportion of the bur- 

 den of taxation, while in our impost system, through 

 means of which increased vitality is incidentally im- 

 parted to all the industrial interests of the nation, 

 the duties should be so adjusted as to fall most 

 heavily on articles of luxury, leaving the neces- 

 saries of life as free from taxation as the absolute wants 

 of the Government, economically administered, will 

 justify. No favored class should demand freedom 

 from assessment, and the taxes should be 'so dis- 

 tributed as not to fall unduly on the poor, but rather 

 on the accumulated wealth of the country, We 

 should look at the national debt just as it is not as a 

 national blessing, but as a heavy burden on the in- 

 dustry of the country, to be discharged without un- 

 necessary delay. 



It is estimated by the Secretary of the Treasury 

 that the expenditures for the fiscal year ending the 

 80th of June, 1866, will exceed the receipts $112,194,- 

 947. It is gratifying, however, to state that it is also 

 estimated that the revenue for the year ending the 

 30th of June, 1867, will exceed the expenditures in 

 the sum of 111,682,818. This amount, or so much 

 as may be deemed sufficient for the purpose, may be 

 applied to the reduction of the public debt, which, on 

 the 31st day of October, 1865, was $2,740,854,750. 

 Every reduction will diminish the total amount of 

 interest to be paid, and so enlarge the means of still 



further reductions, until the whole shall be liqui- 

 dated ; and this, as will be seen from the estimates 

 of the Secretary of the Treasury, may be accom- 

 plished by annual payments even within a period not 

 exceeding thirty years. I have faith that we shall do 

 all this within a reasonable time; that, as we have 

 amazed the world by the suppression of a civil war 

 which was thought to be beyond the control of any 

 Government, so we shall equally show the superiority 

 of our institutions by the prompt and faithful dis- 

 charge of our national obligations. 



The Department of Agriculture, under its present 

 direction, is accomplishing much in developing and 

 utilizing the vast agricultural capabilities of the coun- 

 try, and for information respecting the details of its 

 management reference is made to the annual report 

 of the Commissioner, 



I have dwelt thus fully on our domestic affairs bo- 

 cause of their transcendent importance. Under any 

 circumstances, our great extent of territory and va- 

 riety of climate, producing almost every thing that 

 is necessary for the wants, and even the comforts of 

 man, make us singularly independent of the varying 

 policy of foreign Powers, and protect us against 

 every temptation to " entangling alliances," while at 

 the present moment the reestablishment of harmony 

 and the strength that comes from harmony, will be 

 our best security against " nations who feel powe_r 

 and forget right." For myself, it has been and it 

 will be my constant aim to promote peace and amify 

 with all foreign nations and Powers; and I have 

 every reason to believe that they all, without excep- 

 tion, are animated by the same disposition. Our re- 

 lations with the Emperor of China, so recent in their 

 origin, are most friendly. Our commerce with his 

 dominions is receiving new developments ; and it is 

 very plea'sing to find that the Government of that 

 great Empire manifests satisfaction with our policy, 

 and reposes just confidence in the fairness which 

 marks our intercourse. The unbroken harmony be- 

 tween the United States and the Emperor of Russia 

 is receiving a new support from an enterprise de- 

 signed to carry telegraphic lines across the continent 

 of Asia, through his dominions, and so to connect us 

 with all Europe by a new channel of intercourse. 



Our commerce with South America is about to re- 

 ceive encouragement by a direct line of mail steam- 

 ships to the rising Empire of Brazil. The distin- 

 guished party of men of science who have recently 

 left our country to make a scientific exploration of" 

 the natural history and rivers and mountain ranges 

 of that region, have received from the Emperor that 

 generous welcome which was to have been expected 

 from his constant friendship for the United States, and 

 his well-known zeal in promoting the advancement 

 of knowledge. A hope is entertained that our com- 

 merce with the rich and populous countries that bor- 

 der the Mediterranean Sea may be largely increased. 

 Nothing will be wanting, on the part of this Govern- 

 ment, to extend the protection of our flag over the 

 enterprise of our fellow-citizens. We receive from 

 the Powers in that region assurances of good will ; 

 and it is worthy of note that a special envoy has 

 brought us messages of condolence on the death of 

 our late Chief Magistrate from the Bey of Tunis, 

 whose rule includes the old dominions of Carthage, 

 on the African coast. 



Our domestic contest, now happily ended, has left 

 some traces of our relations with one at least of the 



freat maritime Powers. The formal accordance of 

 elligerent rights to the insurgent States was unpre- 

 cedented, and has not been justified by the issue. But 

 in the systems of neutrality pursued by the Powers 

 which made that concession, there was a marked 

 difference. The materials of war for the insurgent 

 States were furnished, in a great measure, from the 

 workshops of Great Britain; and British ships, 

 manned by British subjects, and prepared for receiv- 

 ing British armaments, sailed from the ports of Great 

 Britain to make war on American commerce, under 



