PUBLIC DOCUMENTS. 



781 



posed in this country until it was demanded by the 

 necessities of war, and was never exacted, I believe ; in 

 any other country, even in its greatest exigencies. 

 Banks are required to secure their circulation by pledg- 

 ing with the Treasurer of the United States bonds of 

 the General Government. The interest upon these 

 bonds, which at the time when the tax was imposed 

 was 6 per cent, is now, in most instances, 3i per cent. 

 Besides, the entire circulation was originally limited 

 by law and no increase was allowable. When the 

 existing bunks had practically a monopoly of the busi- 

 ness, there was force in the suggestion, that for the 

 franchise to the favored grantees the Government 

 might very properly exact a tax on circulation; but 

 for years the system has been free, and the amount of 

 circulation regulated by the public demand. 



The retention of this tax has been suggested as a 

 means of reimbursing the Government for the expense 

 of printing and furnishing the circulating notes. It 

 the tax should be repealed, it would certainly seem 

 proper to require the national banks to pay the amount 

 of such expense to the Comptroller of trie Currency. 



It is perhaps doubtful whether the immediate re- 

 duction of the rate of taxation upon liquors and to- 

 bacco is advisable, especially in view of the drain 

 upon the Treasury which must attend the payment of 

 arrears of pensions. A comparison, however, of the 

 amount of taxes collected under the varying rates of 

 taxation which have at different times prevailed, sug- 

 gests the intimation that some reduction may soon Be 

 made without material diminution of the revenue. 



The tariff laws also need revision ; but, that a due 

 regard may be paid to the conflicting interests of our 

 citizens, important changes should be made with cau- 

 tion. If a careful revision can not be made at this 

 session, a commission, such as was lately approved by 

 the Senate and is now recommended by the Secretary 

 of the Treasury, would doubtless lighten the labors of 

 Congress whenever this subject shall be brought to 

 its consideration. 



The accompanying report of the Secretary of War 

 will make known to you the operations of that de- 

 partment for the past year. 



He suggests measures for promoting the efficiency 

 of the army without adding to the number of its offi- 

 cers, and recommends the legislation necessary to in- 

 crease the number of enlisted men to thirty thousand, 

 the maximum allowed by law. 



This he deems necessary to maintain quietude on 

 our ever-shifting frontier ; to preserve peace and sup- 

 press disorder and marauding in new settlements ; to 

 protect settlers and their property against Indian?, 

 and Indians against the encroachments of intruders ; 

 and to enable peaceable immigrants to establish homes 

 in the most remote parts of our country. 



The army is now necessarily scattered over such a 

 vast extent of territory that, whenever an outbreak 

 occurs, re-enforcements must be hurried from many 

 quarters, over great distances, and always at heavy 

 cost for transportation of men, horses, wagons, and 

 supplies. 



1 concur in the recommendations of the Secretary 

 for increasing the army to the strength of thirty thou- 

 sand enlisted men. 



It appears by the Secretary's report that in the ab- 

 sence of disturbances on the frontier the troops have 

 been actively employed in collecting the Indians 

 hitherto hostile, and locating them on their proper 

 reservations ; that Sitting Bull and his adherents are 

 now prisoners at Fort Kandall ; that the Utes have 

 been moved to their new reservation in Utah ; that 

 during the recent outbreak of the Apaches it was nec- 

 essary to re-enforce the garrisons in Arizona by troops 

 withdrawn from New Mexico ; and that some of the 

 Apaches are now held prisoners for trial, while som 3 

 have escaped, and the majority of the tribe are now 

 on their reservation. 



There is need of legislation to prevent intrusion 

 upon the lands set apart for the Indians. A large 

 military force, at great expense, is now required to 



patrol the boundary-line between Kansas and the In- 

 dian Territory. The only punishment that can at 

 present be inflicted is the forcible removal of the in- 

 truder and the imposition of a pecuniary flue, which, 

 in most cases, it is impossible to collect. There 

 should be a penalty by imprisonment in such cases. 



The separate organization of the Signal Service is 

 urged by the Secretary of War, and a full statement 

 of the advantages of such permanent organization is 

 presented in the report of the Chief Signal Officer. A 

 detailed account of the useful work performed by the 

 Signal Corps and the Weather Bureau is also given 

 in that report. 



I ask attention to the statenients of the Secretary ol 

 War regarding the requisitions frequently made by 

 the Indian Bureau upon the Subsistence Department 

 of the Army for the casual support of bands and 

 tribes of Indians whose appropriations are exhausted. 

 The War Department should not be left, by reason of 

 inadequate provision for the Indian Bureau, to con- 

 tribute for the maintenance of Indians. 



The report of the Chief of Engineers furnishes a de- 

 tailed account of the operations for the improvement 

 of rivers and harbors. 



I commend to your attention the suggestions con- 

 tained in this report in regard to the condition of our 

 fortifications, especially our coast defenses, and recom- 

 mend an increase of the strength of the Engineer 

 Battalion, by which the efficiency of our torpedo sys- 

 tem would be improved. 



I also call your attention to the remarks upon the 

 improvement of the South Pass of the Mississippi 

 River, the proposed free bridge over the Potomac 

 River at Georgetown^ the importance of completing at 

 an early day the north wing of the War Department 

 building, and other recommendations of the Secretary 

 of War which appear in his report. 



The actual expenditures of that department for the 

 fiscal year ending June 30, 1881, were $42,122,201.39. 

 The appropriations for the year 1882 were $44,889,- 

 725.42. The estimates for 1883 are $44,541,276.91. 



The report of the Secretary of the Navy exhibits the 

 condition of that branch of the service, and presents 

 valuable suggestions for its improvement. I call your 

 especial attention also to the appended report of the 

 Advisory Board, which he convened to devise suitable 

 measures for increasing the efficiency of the navy, and 

 particularly to report as to the character and number 

 of vessels necessary to place it upon a footing com- 

 mensurate with the necessities of the Government. 



I can not too stron.gly urge upon vou my conviction 

 that every consideration of national safety, economy, 

 and honor imperatively demands a thorough rehabili- 

 tation of our navy. 



With a full appreciation of the fact that compliance 

 with the suggestions of the head of that department 

 and of the Advisory Board must involve a large ex- 

 penditure of the public moneys, I earnestly recom- 

 mend such appropriations as will accomplish an end 

 which seems to me so desirable. 



Nothing can be more inconsistent with true public 

 economy than withholding the means necessary to 

 accomplish the objects intrusted by the Constitution 

 to the national Legislature. One of those objects, and 

 one which is of paramount importance, is declared by 

 our fundamental law to bo the provision for the 

 " common defense." Surely nothing is more essen- 

 tial to the defense of the United States and of all our 

 people than the efficiency of our navy. 



We have for many ^ears maintained with foreign 

 governments the relations of honorable peace, and 

 that such relations may bo permanent is desired by 

 every patriotic citizen of the republic^ 



But if we heed the teachings of history we shall not 

 forget that in the life of every nation emergencies may 

 arise when a resort to arms can alone save it from 

 dishonor. 



No danger from abroad now threatens this people, 

 nor have we any cause to distrust the friendly profes- 

 sions of other governments. 



