Speech Transcript:

Fellow-Citizens of the Senate and of the House of Representatives:

The past has been an eventful year, and will be hereafter referred to
as a marked epoch in the history of the world. While we have been
happily preserved from the calamities of war, our domestic prosperity
has not been entirely uninterrupted. The crops in portions of the
country have been nearly cut off. Disease has prevailed to a greater
extent than usual, and the sacrifice of human life through casualties
by sea and land is without parallel. But the pestilence has swept by,
and restored salubrity invites the absent to their homes and the
return of business to its ordinary channels. If the earth has
rewarded the labor of the husbandman less bountifully than in
preceding seasons, it has left him with abundance for domestic wants
and a large surplus for exportation. In the present, therefore, as in
the past, we find ample grounds for reverent thankfulness to the God
of grace and providence for His protecting care and merciful dealings
with us as a people.

Although our attention has been arrested by painful interest in
passing events, yet our country feels no more than the slight
vibrations of the convulsions which have shaken Europe. As
individuals we can not repress sympathy with human suffering nor
regret for the causes which produce it; as a nation we are reminded
that whatever interrupts the peace or checks the prosperity of any
part of Christendom tends more or less to involve our own. The
condition of States is not unlike that of individuals; they are
mutually dependent upon each other. Amicable relations between them
and reciprocal good will are essential for the promotion of whatever
is desirable in their moral, social, and political condition. Hence
it has been my earnest endeavor to maintain peace and friendly
intercourse with all nations.

The wise theory of this Government, so early adopted and steadily
pursued, of avoiding all entangling alliances has hitherto exempted
it from many complications in which it would otherwise have become
involved. Notwithstanding this our clearly defined and well-sustained
course of action and our geographical position, so remote from Europe,
increasing disposition has been manifested by some of its Governments
to supervise and in certain respects to direct our foreign policy. In
plans for adjusting the balance of power among themselves they have
assumed to take us into account, and would constrain us to conform
our conduct to their views. One or another of the powers of Europe
has from time to time undertaken to enforce arbitrary regulations
contrary in many respects to established principles of international
law. That law the United States have in their foreign intercourse
uniformly respected and observed, and they can not recognize any such
interpolations therein as the temporary interests of others may
suggest. They do not admit that the sovereigns of one continent or of
a particular community of states can legislate for all others.

Leaving the transatlantic nations to adjust their political system in
the way they may think best for their common welfare, the independent
powers of this continent may well assert the right to be exempt from
all annoying interference on their part. Systematic abstinence from
intimate political connection with distant foreign nations does not
conflict with giving the widest range to our foreign commerce. This
distinction, so clearly marked in history, seems to have been
overlooked or disregarded by some leading foreign states. Our refusal
to be brought within and subjected to their peculiar system has, I
fear, created a jealous distrust of our conduct and induced on their
part occasional acts of disturbing effect upon our foreign relations.
Our present attitude and past course give assurances, which should not
be questioned, that our purposes are not aggressive nor threatening to
the safety and welfare of other nations. Our military establishment in
time of peace is adapted to maintain exterior defenses and to preserve
order among the aboriginal tribes within the limits of the Union. Our
naval force is intended only for the protection of our citizens
abroad and of our commerce, diffused, as it is, over all the seas of
the globe. The Government of the United States, being essentially
pacific in policy, stands prepared to repel invasion by the voluntary
service of a patriotic people, and provides no permanent means of
foreign aggression. These considerations should allay all
apprehension that we are disposed to encroach on the rights or
endanger the security of other states.

Some European powers have regarded with disquieting concern the
territorial expansion of the United States. This rapid growth has
resulted from the legitimate exercise of sovereign rights belonging
alike to all nations, and by many liberally exercised. Under such
circumstances it could hardly have been expected that those among
them which have within a comparatively recent period subdued and
absorbed ancient kingdoms, planted their standards on every
continent, and now possess or claim the control of the islands of
every ocean as their appropriate domain would look with unfriendly
sentiments upon the acquisitions of this country, in every instance
honorably obtained, or would feel themselves justified in imputing
our advancement to a spirit of aggression or to a passion for
political predominance. Our foreign commerce has reached a magnitude
and extent nearly equal to that of the first maritime power of the
earth, and exceeding that of any other. Over this great interest, in
which not only our merchants, but all classes of citizens, at least
indirectly, are concerned, it is the duty of the executive and
legislative branches of the Government to exercise a careful
supervision and adopt proper measures for its protection. The policy
which I had in view in regard to this interest embraces its future as
well as its present security. Long experience has shown that, in
general, when the principal powers of Europe are engaged in war the
rights of neutral nations are endangered. This consideration led, in
the progress of the War of our Independence, to the formation of the
celebrated confederacy of armed neutrality, a primary object of which
was to assert the doctrine that free ships make free goods, except in
the case of articles contraband of war--a doctrine which from the
very commencement of our national being has been a cherished idea of
the statesmen of this country. At one period or another every
maritime power has by some solemn treaty stipulation recognized that
principle, and it might have been hoped that it would come to be
universally received and respected as a rule of international law.
But the refusal of one power prevented this, and in the next great
war which ensued--that of the French Revolution--it failed to be
respected among the belligerent States of Europe. Notwithstanding
this, the principle is generally admitted to be a sound and salutary
one, so much so that at the commencement of the existing war in
Europe Great Britain and France announced their purpose to observe it
for the present; not, however, as a recognized international fight,
but as a mere concession for the time being. The cooperation,
however, of these two powerful maritime nations in the interest of
neutral rights appeared to me to afford an occasion inviting and
justifying on the part of the United States a renewed effort to make
the doctrine in question a principle of international law, by means
of special conventions between the several powers of Europe and
America. Accordingly, a proposition embracing not only the rule that
free ships make free goods, except contraband articles, but also the
less contested one that neutral property other than contraband,
though on board enemy's ships, shall be exempt from confiscation, has
been submitted by this Government to those of Europe and America.

Russia acted promptly in this matter, and a convention was concluded
between that country and the United States providing for the
observance of the principles announced, not only as between
themselves, but also as between them and all other nations which
shall enter into like stipulations. None of the other powers have as
yet taken final action on the subject. I am not aware, however, that
any objection to the proposed stipulations has been made, but, on the
contrary, they are acknowledged to be essential to the security of
neutral commerce, and the only apparent obstacle to their general
adoption is in the possibility that it may be encumbered by
inadmissible conditions. The King of the Two Sicilies has expressed
to our minister at Naples his readiness to concur in our proposition
relative to neutral rights and to enter into a convention on that
subject.

The King of Prussia entirely approves of the project of a treaty to
the same effect submitted to him, but proposes an additional article
providing for the renunciation of privateering. Such an article, for
most obvious reasons, is much desired by nations having naval
establishments large in proportion to their foreign commerce. If it
were adopted as an international rule, the commerce of a nation
having comparatively a small naval force would be very much at the
mercy of its enemy in case of war with a power of decided naval
superiority. The bare statement of the condition in which the United
States would be placed, after having surrendered the right to resort
to privateers, in the event of war with a belligerent of naval
supremacy will show that this Government could never listen to such a
proposition. The navy of the first maritime power in Europe is at
least ten times as large as that of the United States. The foreign
commerce of the two countries is nearly equal, and about equally
exposed to hostile depredations. In war between that power and the
United States, without resort on our part to our mercantile marine
the means of our enemy to inflict injury upon our commerce would be
tenfold greater than ours to retaliate. We could not extricate our
country from this unequal condition, with such an enemy, unless we at
once departed from our present peaceful policy and became a great
naval power. Nor would this country be better situated in war with
one of the secondary naval powers. Though the naval disparity would
be less, the greater extent and more exposed condition of our
widespread commerce would give any of them a like advantage over us.

The proposition to enter into engagements to forego a resort to
privateers in case this country should be forced into war with a
great naval power is not entitled to more favorable consideration
than would be a proposition to agree not to accept the services of
volunteers for operations on land. When the honor or the rights of
our country require it to assume a hostile attitude, it confidently
relies upon the patriotism of its citizens, not ordinarily devoted to
the military profession, to augment the Army and the Navy so as to
make them fully adequate to the emergency which calls them into
action. The proposal to surrender the right to employ privateers is
professedly founded upon the principle that private property of
unoffending noncombatants, though enemies, should be exempt from the
ravages of war; but the proposed surrender goes but little way in
carrying out that principle, which equally requires that such private
property should not be seized or molested by national ships of war.
Should the leading powers of Europe concur in proposing as a rule of
international law to exempt private property upon the ocean from
seizure by public armed cruisers as well as by privateers, the United
States will readily meet them upon that broad ground.

Since the adjournment of Congress the ratifications of the treaty
between the United States and Great Britain relative to coast
fisheries and to reciprocal trade with the British North American
Provinces have been exchanged, and some of its anticipated advantages
are already enjoyed by us, although its full execution was to abide
certain acts of legislation not yet fully performed. So soon as it
was ratified Great Britain opened to our commerce the free navigation
of the river St. Lawrence and to our fishermen unmolested access to
the shores and bays, from which they had been previously excluded, on
the coasts of her North American Provinces; in return for which she
asked for the introduction free of duty into the ports of the United
States of the fish caught on the same coast by British fishermen.
This being the compensation stipulated in the treaty for privileges
of the highest importance and value to the United States, which were
thus voluntarily yielded before it became effective, the request
seemed to me to be a reasonable one; but it could not be acceded to
from want of authority to suspend our laws imposing duties upon all
foreign fish. In the meantime the Treasury Department issued a
regulation for ascertaining the duties paid or secured by bonds on
fish caught on the coasts of the British Provinces and brought to our
markets by British subjects after the fishing grounds had been made
fully accessible to the citizens of the United States. I recommend to
your favorable consideration a proposition, which will be submitted to
you, for authority to refund the duties and cancel the bonds thus
received. The Provinces of Canada and New Brunswick have also
anticipated the full operation of the treaty by legislative
arrangements, respectively, to admit free of duty the products of the
United States mentioned in the free list of the treaty; and an
arrangement similar to that regarding British fish has been made for
duties now chargeable on the products of those Provinces enumerated
in the same free list and introduced therefrom into the United
States, a proposition for refunding which will, in my judgment, be in
like manner entitled to your favorable consideration.

There is difference of opinion between the United States and Great
Britain as to the boundary line of the Territory of Washington
adjoining the British possessions on the Pacific, which has already
led to difficulties on the part of the citizens and local authorities
of the two Governments I recommend that provision he made for a
commission, to be joined by one on the part of Her Britannic Majesty,
for the purpose of running and establishing the line in controversy.
Certain stipulations of the third and fourth articles of the treaty
concluded by the United States and Great Britain in 1846, regarding
possessory rights of the Hudsons Bay Company and property of the
Pugets Sound Agricultural Company, have given rise to serious
disputes, and it is important to all concerned that summary means of
settling them amicably should be devised. I have reason to believe
that an arrangement can be made on just terms for the extinguishment
of the rights in question, embracing also the right of the Hudsons
Bay Company to the navigation of the river Columbia; and I therefore
suggest to your consideration the expediency of making a contingent
appropriation for that purpose.

France was the early and efficient ally of the United States in their
struggle for independence. From that time to the present, with
occasional slight interruptions, cordial relations of friendship have
existed between the Governments and people of the two countries. The
kindly sentiments cherished alike by both nations have led to
extensive social and commercial intercourse, which I trust will not
be interrupted or checked by any casual event of an apparently
unsatisfactory character. The French consul at San Francisco was not
long since brought into the United States district court at that
place by compulsory process as a witness in favor of another foreign
consul, in violation, as the French Government conceives, of his
privileges under our consular convention with France. There being
nothing in the transaction which could imply any disrespect to France
or its consul, such explanation has been made as, I hope, will be
satisfactory. Subsequently misunderstanding arose on the subject of
the French Government having, as it appeared, abruptly excluded the
American minister to Spain from passing through France on his way
from London to Madrid. But that Government has unequivocally
disavowed any design to deny the right of transit to the minister of
the United States, and after explanations to this effect he has
resumed his journey and actually returned through France to Spain. I
herewith lay before Congress the correspondence on this subject
between our envoy at Paris and the minister of foreign relations of
the French Government.

The position of our affairs with Spain remains as at the close of the
last session. Internal agitation, assuming very nearly the character
of political revolution, has recently convulsed that country. The
late ministers were violently expelled from power, and men of very
different views in relation to its internal affairs have succeeded.
Since this change there has been no propitious opportunity to resume
and press on negotiations for the adjustment of serious questions of
difficulty between the Spanish Government and the United States.
There is reason to believe that our minister will find the present
Government more favorably inclined than the preceding to comply with
our just demands and to make suitable arrangements for restoring
harmony and preserving peace between the two countries.

Negotiations are pending with Denmark to discontinue the practice of
levying tolls on our vessels and their cargoes passing through the
Sound. I do not doubt that we can claim exemption therefrom as a
matter of right. It is admitted on all hands that this exaction is
sanctioned, not by the general principles of the law of nations, but
only by special conventions which most of the commercial nations have
entered into with Denmark. The fifth article of our treaty of 1826
with Denmark provides that there shall not be paid on the vessels of
the United States and their cargoes when passing through the Sound
higher duties than those of the most favored nations. This may be
regarded as an implied agreement to submit to the tolls during the
continuance of the treaty, and consequently may embarrass the
assertion of our right to be released therefrom. There are also other
provisions in the treaty which ought to be modified. It was to remain
in force for ten years and until one year after either party should
give notice to the other of intention to terminate it. I deem it
expedient that the contemplated notice should be given to the
Government of Denmark.

The naval expedition dispatched about two years since for the purpose
of establishing relations with the Empire of Japan has been ably and
skillfully conducted to a successful termination by the officer to
whom it was intrusted. A treaty opening certain of the ports of that
populous country has been negotiated, and in order to give full
effect thereto it only remains to exchange ratifications and adopt
requisite commercial regulations.

The treaty lately concluded between the United States and Mexico
settled some of our most embarrassing difficulties with that country,
but numerous claims upon it for wrongs and injuries to our citizens
remained unadjusted, and many new cases have been recently added to
the former list of grievances. Our legation has been earnest in its
endeavors to obtain from the Mexican Government a favorable
consideration of these claims, but hitherto without success. This
failure is probably in some measure to be ascribed to the disturbed
condition of that country. It has been my anxious desire to maintain
friendly relations with the Mexican Republic and to cause its rights
and territories to be respected, not only by our citizens, but by
foreigners who have resorted to the United States for the purpose of
organizing hostile expeditions against some of the States of that
Republic. The defenseless condition in which its frontiers have been
left has stimulated lawless adventurers to embark in these
enterprises and greatly increased the difficulty of enforcing our
obligations of neutrality. Regarding it as my solemn duty to fulfill
efficiently these obligations not only toward Mexico, but other
foreign nations, I have exerted all the powers with which I am
invested to defeat such proceedings and bring to punishment those who
by taking a part therein violated our laws. The energy and activity of
our civil and military authorities have frustrated the designs of
those who meditated expeditions of this character except in two
instances. One of these, composed of foreigners, was at first
countenanced and aided by the Mexican Government itself, it having
been deceived as to their real object. The other, small in number,
eluded the vigilance of the magistrates at San Francisco and
succeeded in reaching the Mexican territories; but the effective
measures taken by this Government compelled the abandonment of the
undertaking.

The commission to establish the new line between the United States
and Mexico, according to the provisions of the treaty of the 30th of
December last, has been organized, and the work is already
commenced.

Our treaties with the Argentine Confederation and with the Republics
of Uruguay and Paraguay secure to us the free navigation of the river
La Plata and some of its larger tributaries, but the same success has
not attended our endeavors to open the Amazon. The reasons in favor
of the free use of that river I had occasion to present fully in a
former message, and, considering the cordial relations which have
long existed between this Government and Brazil, it may be expected
that pending negotiations will eventually reach a favorable result.

Convenient means of transit between the several parts of a country
are not only desirable for the objects of commercial and personal
communication, but essential to its existence under one government.
Separated, as are the Atlantic and Pacific coasts of the United
States, by the whole breadth of the continent, still the inhabitants
of each are closely bound together by community of origin and
institutions and by strong attachment to the Union. Hence the
constant and increasing intercourse and vast interchange of
commercial productions between these remote divisions of the
Republic. At the present time the most practicable and only,
commodious routes for communication between them are by the way of
the isthmus of Central America. It is the duty of the Government to
secure these avenues against all danger of interruption.

In relation to Central America, perplexing questions existed between
the United States and Great Britain at the time of the cession of
California. These, as well as questions which subsequently arose
concerning interoceanic communication across the Isthmus, were, as it
was supposed, adjusted by the treaty of April 19, 1850, but,
unfortunately, they have been reopened by serious misunderstanding as
to the import of some or its provisions, a readjustment of which is
now under consideration. Our minister at London has made strenuous
efforts to accomplish this desirable object, but has not yet found it
possible to bring the negotiations to a termination.

As incidental to these questions, I deem it proper to notice an
occurrence which happened in Central America near the close of the
last session of Congress. So soon as the necessity was perceived of
establishing interoceanic communications across the Isthmus a company
was organized, under the authority of the State of Nicaragua, but
composed for the most part of citizens of the United States, for the
purpose of opening such a transit way by the river San Juan and Lake
Nicaragua, which soon became an eligible and much used route in the
transportation of our citizens and their property between the
Atlantic and Pacific. Meanwhile, and in anticipation of the
completion and importance of this transit way, a number of
adventurers had taken possession of the old Spanish port at the mouth
of the river San Juan in open defiance of the State or States of
Central America, which upon their becoming independent had rightfully
succeeded to the local sovereignty and jurisdiction of Spain. These
adventurers undertook to change the name of the place from San Juan
del Norte to Greytown, and though at first pretending to act as the
subjects of the fictitious sovereign of the Mosquito Indians, they
subsequently repudiated the control of any power whatever, assumed to
adopt a distinct political organization, and declared themselves an
independent sovereign state. If at some time a faint hope was
entertained that they might become a stable and respectable
community, that hope soon vanished. They proceeded to assert
unfounded claims to civil jurisdiction over Punta Arenas, a position
on the opposite side of the river San Juan, which was in possession,
under a title wholly independent of them, of citizens of the United
States interested in the Nicaragua Transit Company, and which was
indispensably necessary to the prosperous operation of that route
across the Isthmus. The company resisted their groundless claims,
whereupon they proceeded to destroy some of its buildings and
attempted violently to dispossess it.

At a later period they organized a strong force for the purpose of
demolishing the establishment at Punta Arenas, but this mischievous
design was defeated by the interposition of one of our ships of war
at that time in the harbor of San Juan. Subsequently to this, in May
last, a body of men from Greytown crossed over to Punta Arenas,
arrogating authority to arrest on the charge of murder a captain of
one of the steamboats of the Transit Company. Being well aware that
the claim to exercise jurisdiction there would be resisted then, as
it had been on previous occasions, they went prepared to assert it by
force of arms. Our minister to Central America happened to be present
on that occasion. Believing that the captain of the steamboat was
innocent (for he witnessed the transaction on which the charge was
founder), and believing also that the intruding party, having no
jurisdiction over the place where they proposed to make the arrest,
would encounter desperate resistance if they persisted in their
purpose, he interposed, effectually, to prevent violence and
bloodshed. The American minister afterwards visited Greytown, and
whilst he was there a mob, including certain of the so-called public
functionaries of the place, surrounded the house in which he was,
avowing that they had come to arrest him by order of some person
exercising the chief authority. While parleying with them he was
wounded by a missile from the crowd. A boat dispatched from the
American steamer Northern Light to release him from the perilous
situation in which he was understood to be was fired into by the town
guard and compelled to return. These incidents, together with the
known character of the population of Greytown and their excited
state, induced just apprehensions that the lives and property of our
citizens at Punta Arenas would be in imminent danger after the
departure of the steamer, with her passengers, for New York, unless a
guard was left for their protection. For this purpose, and in order to
insure the safety of passengers and property passing over the route, a
temporary force was organized, at considerable expense to the United
States, for which provision was made at the last session of
Congress.

This pretended community, a heterogeneous assemblage gathered from
various countries, and composed for the most part of blacks and
persons of mixed blood, had previously given other indications of
mischievous and dangerous propensities. Early in the same month
property was clandestinely abstracted from the depot of the Transit
Company and taken to Greytown. The plunderers obtained shelter there
and their pursuers were driven back by its people, who not only
protected the wrongdoers and shared the plunder, but treated with
rudeness and violence those who sought to recover their property.

Such, in substance, are the facts submitted to my consideration, and
proved by trustworthy evidence. I could not doubt that the case
demanded the interposition of this Government. Justice required that
reparation should be made for so many and such gross wrongs, and that
a course of insolence and plunder, tending directly to the insecurity
of the lives of numerous travelers and of the rich treasure belonging
to our citizens passing over this transit way, should be peremptorily
arrested. Whatever it might be in other respects, the community in
question, in power to do mischief, was not despicable. It was well
provided with ordnance, small arms, and ammunition, and might easily
seize on the unarmed boats, freighted with millions of property,
which passed almost daily within its reach. It did not profess to
belong to any regular government, and had, in fact, no recognized
dependence on or connection with anyone to which the United States or
their injured citizens might apply for redress or which could be held
responsible in any way for the outrages committed. Not standing
before the world in the attitude of an organized political society,
being neither competent to exercise the rights nor to discharge the
obligations of a government, it was, in fact, a marauding
establishment too dangerous to be disregarded and too guilty to pass
unpunished, and yet incapable of being treated in any other way than
as a piratical resort of outlaws or a camp of savages depredating on
emigrant trains or caravans and the frontier settlements of civilized
states.

Seasonable notice was given to the people of Greytown that this
Government required them to repair the injuries they had done to our
citizens and to make suitable apology for their insult of our
minister, and that a ship of war would be dispatched thither to
enforce compliance with these demands. But the notice passed
unheeded. Thereupon a commander of the Navy, in charge of the sloop
of war Cyane, was ordered to repeat the demands and to insist upon a
compliance therewith. Finding that neither the populace nor those
assuming to have authority over them manifested any disposition to
make the required reparation, or even to offer excuse for their
conduct, he warned them by a public proclamation that if they did not
give satisfaction within a time specified he would bombard the town.
By this procedure he afforded them opportunity to provide for their
personal safety. To those also who desired to avoid loss of property
in the punishment about to be inflicted on the offending town he
furnished the means of removing their effects by the boats of his own
ship and of a steamer which he procured and tendered to them for that
purpose. At length, perceiving no disposition on the part of the town
to comply with his requisitions, he appealed to the commander of Her
Britannic Majesty's schooner Bermuda, who was seen to have
intercourse and apparently much influence with the leaders among
them, to interpose and persuade them to take some course calculated
to save the necessity of resorting to the extreme measure indicated
in his proclamation; but that officer, instead of acceding to the
request, did nothing more than to protest against the contemplated
bombardment. No steps of any sort were taken by the people to give
the satisfaction required. No individuals, if any there were, who
regarded themselves as not responsible for the misconduct of the
community adopted any means to separate themselves from the fate of
the guilty. The several charges on which the demands for redress were
founded had been publicly known to all for some time, and were again
announced to them. They did not deny any of these charges; they
offered no explanation, nothing in extenuation of their conduct, but
contumaciously refused to hold any intercourse with the commander of
the Cyane. By their obstinate silence they seemed rather desirous to
provoke chastisement than to escape it. There is ample reason to
believe that this conduct of wanton defiance on their part is
imputable chiefly to the delusive idea that the American Government
would be deterred from punishing them through fear of displeasing a
formidable foreign power, which they presumed to think looked with
complacency upon their aggressive and insulting deportment toward the
United States. The Cyane at length fired upon the town. Before much
injury had been done the fire was twice suspended in order to afford
opportunity for an arrangement, but this was declined. Most of the
buildings of the place, of little value generally, were in the sequel
destroyed, but, owing to the considerate precautions taken by our
naval commander, there was no destruction of life.

When the Cyane was ordered to Central America, it was confidently
hoped and expected that no occasion would arise for "a resort to
violence and destruction of property and loss of life." Instructions
to that effect were given to her commander; and no extreme act would
have been requisite had not the people themselves, by their
extraordinary conduct in the affair, frustrated all the possible mild
measures for obtaining satisfaction. A withdrawal from the place, the
object of his visit entirely defeated, would under the circumstances
in which the commander of the Cyane found himself have been absolute
abandonment of all claim of our citizens for indemnification and
submissive acquiescence in national indignity. It would have
encouraged in these lawless men a spirit of insolence and rapine most
dangerous to the lives and property of our citizens at Punta Arenas,
and probably emboldened them to grasp at the treasures and valuable
merchandise continually passing over the Nicaragua route. It
certainly would have been most satisfactory to me if the objects of
the Cyane's mission could have been consummated without any act of
public force, but the arrogant contumacy of the offenders rendered it
impossible to avoid the alternative either to break up their
establishment or to leave them impressed with the idea that they
might persevere with impunity in a career of insolence and plunder.

This transaction has been the subject of complaint on the part of
some foreign powers, and has been characterized with more of
harshness than of justice. If comparisons were to be instituted, it
would not be difficult to present repeated instances in the history
of states standing in the very front of modern civilization where
communities far less offending and more defenseless than Greytown
have been chastised with much greater severity, and where not cities
only have been laid in ruins, but human life has been recklessly
sacrificed and the blood of the innocent made profusely to mingle
with that of the guilty.

Passing from foreign to domestic affairs, your attention is naturally
directed to the financial condition of the country, always a subject
of general interest. For complete and exact information regarding the
finances and the various branches of the public service connected
therewith I refer you to the report of the Secretary of the Treasury,
from which it will appear that the amount of revenue during the last
fiscal year from all sources was $73,549,705, and that the public
expenditures for the same period, exclusive of payments on account of
the public debt, amounted to $51, 018,249. During the same period the
payments made in redemption of the public debt, including interest
and premium, amounted to $24,336,380. To the sum total of the
receipts of that year is to be added a balance remaining in the
Treasury at the commencement thereof, amounting to $21,942,892; and
at the close of the same year a corresponding balance, amounting to
$20,137,967, of receipts above expenditures also remained in the
Treasury. Although, in the opinion of the Secretary of the Treasury,
the receipts of the current fiscal year are not likely to equal in
amount those of the last, yet they will undoubtedly exceed the amount
of expenditures by at least $15,000,000. I shall therefore continue to
direct that the surplus revenue be applied, so far as it can be
judiciously and economically done, to the reduction of the public
debt, the amount of which at the commencement of the last fiscal year
was $67,340,628; of which there had been paid on the 20th day of
November, 1854, the sum of $22,365,172, leaving a balance of
outstanding public debt of only $44,975,456, redeemable at different
periods within fourteen years. There are also remnants of other
Government stocks, most of which are already due, and on which the
interest has ceased, but which have not yet been presented for
payment, amounting to $233,179. This statement exhibits the fact that
the annual income of the Government greatly exceeds the amount of its
public debt, which latter remains unpaid only because the time of
payment has not yet matured, and it can not be discharged at once
except at the option of public creditors, who prefer to retain the
securities of the United States; and the other fact, not less
striking, that the annual revenue from all sources exceeds by many
millions of dollars the amount needed for a prudent and economical
administration of the Government.

The estimates presented to Congress from the different Executive
Departments at the last session amounted to $38,406,581 and the
appropriations made to the sum of $58,116,958. Of this excess of
appropriations over estimates, however, more than twenty millions was
applicable to extraordinary objects, having no reference to the usual
annual expenditures. Among these objects was embraced ten millions to
meet the third article of the treaty between the United States and
Mexico; so that, in fact, for objects of ordinary expenditure the
appropriations were limited to considerably less than $40,000,000. I
therefore renew my recommendation for a reduction of the duties on
imports. The report of the Secretary of the Treasury presents a
series of tables showing the operation of the revenue system for
several successive years; and as the general principle of reduction
of duties with a view to revenue, and not protection, may now be
regarded as the settled policy of the country, I trust that little
difficulty will be encountered in settling the details of a measure
to that effect.

In connection with this subject I recommend a change in the laws,
which recent experience has shown to be essential to the protection
of the Government. There is no express provision of law requiring the
records and papers of a public character of the several officers of
the Government to be left in their offices for the use of their
successors, nor any provision declaring it felony on their part to
make false entries in the books or return false accounts. In the
absence of such express provision by law, the outgoing officers in
many instances have claimed and exercised the right to take into
their own possession important books and papers, on the ground that
these were their private property, and have placed them beyond the
reach of the Government. Conduct of this character, brought in
several instances to the notice of the present Secretary of the
Treasury, naturally awakened his suspicion, and resulted in the
disclosure that at four ports--namely, Oswego, Toledo, Sandusky, and
Milwaukee--the Treasury had, by false entries, been defrauded within
the four years next preceding March, 1853, of the sum of $198,000.
The great difficulty with which the detection of these frauds has
been attended, in consequence of the abstraction of books and papers
by the retiring officers, and the facility with which similar frauds
in the public service may be perpetrated render the necessity of new
legal enactments in the respects above referred to quite obvious. For
other material modifications of the revenue laws which seem to me
desirable, I refer you to the report of the Secretary of the
Treasury. That report and the tables which accompany it furnish ample
proofs of the solid foundation on which the financial security of the
country rests and of the salutary influence of the
independent-treasury system upon commerce and all monetary
operations.

The experience of the last year furnishes additional reasons, I
regret to say, of a painful character, for the recommendation
heretofore made to provide for increasing the military force employed
in the Territory inhabited by the Indians. The settlers-on the
frontier have suffered much from the incursions of predatory bands,
and large parties of emigrants to our Pacific possessions have been
massacred with impunity. The recurrence of such scenes can only be
prevented by teaching these wild tribes the power of and their
responsibility to the United States. From the garrisons of our
frontier posts it is only possible to detach troops in small bodies;
and though these have on all occasions displayed a gallantry and a
stern devotion to duty which on a larger field would have commanded
universal admiration, they have usually suffered severely in these
conflicts with superior numbers, and have sometimes been entirely
sacrificed. All the disposable force of the Army is already employed
on this service, and is known to be wholly inadequate to the
protection which should be afforded. The public mind of the country
has been recently shocked by savage atrocities committed upon
defenseless emigrants and border settlements, and hardly less by the
unnecessary destruction of valuable lives where inadequate
detachments of troops have undertaken to furnish the needed aid.
Without increase of the military force these scenes will be repeated,
it is to be feared, on a larger scale and with more disastrous
consequences. Congress, I am sure, will perceive that the plainest
duties and responsibilities of Government are involved in this
question, and I doubt not that prompt action may be confidently
anticipated when delay must be attended by such fearful hazards.

The bill of the last session providing for an increase of the pay of
the rank and file of the Army has had beneficial results, not only in
facilitating enlistments, but in obvious improvement in the class of
men who enter the service. I regret that corresponding consideration
was not bestowed on the officers, who, in view of their character and
services and the expenses to which they are necessarily subject,
receive at present what is, in my judgment, inadequate compensation.

The valuable services constantly rendered by the Army and its
inestimable importance as the nucleus around which the volunteer
forces of the nation can promptly gather in the hour of danger,
sufficiently attest the wisdom of maintaining a military peace
establishment; but the theory of our system and the wise practice
under it require that any proposed augmentation in time of peace be
only commensurate with our extended limits and frontier relations.
While scrupulously adhering to this principle, I find in existing
circumstances a necessity for increase of our military force, and it
is believed that four new regiments, two of infantry and two of
mounted men, will be sufficient to meet the present exigency. If it
were necessary carefully to weigh the cost in a case of such urgency,
it would be shown that the additional expense would be comparatively
light.

With the increase of the numerical force of the Army should, I think,
be combined certain measures of reform in its organic arrangement and
administration. The present organization is the result of partial
legislation often directed to special objects and interests; and the
laws regulating rank and command, having been adopted many years ago
from the British code, are not always applicable to our service. It
is not surprising, therefore, that the system should be deficient in
the symmetry and simplicity essential to the harmonious working of
its several parts, and require a careful revision.

The present organization, by maintaining large staff corps or
departments, separates many officers from that close connection with
troops and those active duties in the field which are deemed
requisite to qualify them for the varied responsibilities of high
command. Were the duties of the Army staff mainly discharged by
officers detached from their regiments, it is believed that the
special service would be equally well performed and the discipline
and instruction of the Army be improved. While due regard to the
security of the rights of officers and to the nice sense of honor
which should be cultivated among them would seem to exact compliance
with the established rule of promotion in ordinary cases, still it
can hardly be doubted that the range of promotion by selection, which
is now practically confined to the grade of general officers, might be
somewhat extended with benefit to the public service. Observance of
the rule of seniority sometimes leads, especially in time of peace,
to the promotion of officers who, after meritorious and even
distinguished service, may have been rendered by age or infirmity
incapable of performing active duty, and whose advancement,
therefore, would tend to impair the efficiency of the Army. Suitable
provision for this class of officers, by the creation of a retired
list, would remedy the evil without wounding the just pride of men
who by past services have established a claim to high consideration.
In again commending this measure to the favorable consideration of
Congress I would suggest that the power of placing officers on the
retired list be limited to one year. The practical operation of the
measure would thus be tested, and if after the lapse of years there
should be occasion to renew the provision it can be reproduced with
any improvements which experience may indicate. The present
organization of the artillery into regiments is liable to obvious
objections. The service of artillery is that of batteries, and an
organization of batteries into a corps of artillery would be more
consistent with the nature of their duties. A large part of the
troops now called artillery are, and have been, on duty as infantry,
the distinction between the two arms being merely nominal. This
nominal artillery in our service is disproportionate to the whole
force and greater than the wants of the country demand. I therefore
commend the discontinuance of a distinction which has no foundation
in either the arms used or the character of the service expected to
be performed.

In connection with the proposition for the increase of the Army, I
have presented these suggestions with regard to certain measures of
reform as the complement of a system which would produce the happiest
results from a given expenditure, and which, I hope, may attract the
early attention and be deemed worthy of the approval of Congress.

The recommendation of the Secretary of the Navy having reference to
more ample provisions for the discipline and general improvement in
the character of seamen and for the reorganization and gradual
increase of the Navy I deem eminently worthy of your favorable
consideration. The principles which have controlled our policy in
relation to the permanent military force by sea and land are sound,
consistent with the theory of our system, and should by no means be
disregarded. But, limiting the force to the objects particularly set
forth in the preceding part of this message, we should not overlook
the present magnitude and prospective extension of our commercial
marine, nor fail to give due weight to the fact that besides the
2,000 miles of Atlantic seaboard we have now a Pacific coast
stretching from Mexico to the British possessions in the north,
teeming with wealth and enterprise and demanding the constant
presence of ships of war. The augmentation of the Navy has not kept
pace with the duties properly and profitably assigned to it in time
of peace, and it is inadequate for the large field of its operations,
not merely in the present, but still more in the progressively
increasing exigencies of the commerce of the United States. I
cordially approve of the proposed apprentice system for our national
vessels recommended by the Secretary of the Navy. The occurrence
during the last few months of marine disasters of the most tragic
nature, involving great loss of human life, has produced intense
emotions of sympathy and sorrow throughout the country. It may well
be doubted whether all these calamitous events are wholly
attributable to the necessary and inevitable dangers of the sea. The
merchants, mariners, and shipbuilders of the United States are, it is
true, unsurpassed in far-reaching enterprise, skill, intelligence, and
courage by any others in the world. But with the increasing amount of
our commercial tonnage in the aggregate and the larger size and
improved equipment of the ships now constructed a deficiency in the
supply of reliable seamen begins to be very seriously felt. The
inconvenience may perhaps be met in part by due regulation for the
introduction into our merchant ships of indented apprentices, which,
while it would afford useful and eligible occupation to numerous
young men, would have a tendency to raise the character of seamen as
a class. And it is deserving of serious reflection whether it may not
be desirable to revise the existing laws for the maintenance of
discipline at sea, upon which the security of life and property on
the ocean must to so great an extent depend. Although much attention
has already been given by Congress to the proper construction and
arrangement of steam vessels and all passenger ships, still it is
believed that the resources of science and mechanical skill in this
direction have not been exhausted. No good reason exists for the
marked distinction which appears upon our statutes between the laws
for protecting life and property at sea and those for protecting them
on land. In most of the States severe penalties are provided to punish
conductors of trains, engineers, and others employed in the
transportation of persons by railway or by steamboats on rivers. Why
should not the same principle be applied to acts of insubordination,
cowardice, or other misconduct on the part of masters and mariners
producing injury or death to passengers on the high seas, beyond the
jurisdiction of any of the States, and where such delinquencies can
be reached only by the power of Congress? The whole subject is
earnestly commended to your consideration.

The report of the Postmaster-General, to which you are referred for
many interesting details in relation to this important and rapidly
extending branch of the public service, shows that the expenditure of
the year ending June 30, 1854, including $133,483 of balance due to
foreign offices, amounted to $8,710,907. The gross receipts during
the same period amounted to $6,955,586, exhibiting an expenditure
over income of $1,755,321 and a diminution of deficiency as compared
with the last year of $361,756. The increase of the revenue of the
Department for the year ending June 30, 1854, over the preceding year
was $970,399. No proportionate increase, however, can be anticipated
for the current year, in consequence of the act of Congress of June
23, 1854, providing for increased compensation to all postmasters.
From these statements it is apparent that the Post-Office Department,
instead of defraying its expenses according to the design at the time
of its creation, is now, and under existing laws must continue to be,
to no small extent a charge upon the general Treasury. The cost of
mail transportation during the year ending June 30, 1854, exceeds the
cost of the preceding year by $495,074. I again call your attention to
the subject of mail transportation by ocean steamers, and commend the
suggestions of the Postmaster General to your early attention.

During the last fiscal year 11,070,935 acres of the public lands have
been surveyed and 8,190,017 acres brought into market. The number of
acres sold is 7,035,735 and the amount received therefor $9,285,533.
The aggregate amount of lands sold, located under military scrip and
land warrants, selected as swamp lands by States, and by locating
under grants for roads is upward of 23,000,000 acres. The increase of
lands sold over the previous year is about 6,000,000 acres, and the
sales during the first two quarters of the current year present the
extraordinary result of five and a half millions sold, exceeding by
nearly 4,000,000 acres the sales of the corresponding quarters of the
last year.

The commendable policy of the Government in relation to setting apart
public domain for those who have served their country in time of war
is illustrated by the fact that since 1790 no less than 30,000,000
acres have been applied to this object.

The suggestions which I submitted in my annual message of last year
in reference to grants of land in aid of the construction of railways
were less full and explicit than the magnitude of the subject and
subsequent developments would seem to render proper and desirable. Of
the soundness of the principle then asserted with regard to the
limitation of the power of Congress I entertain no doubt, but in its
application it is not enough that the value of lands in a particular
locality may be enhanced; that, in fact, a larger amount of money may
probably be received in a given time for alternate sections than could
have been realized for all the sections without the impulse and
influence of the proposed improvements. A prudent proprietor looks
beyond limited sections of his domain, beyond present results to the
ultimate effect which a particular line of policy is likely to
produce upon all his possessions and interests. The Government, which
is trustee in this matter for the people of the States, is bound to
take the same wise and comprehensive view. Prior to and during the
last session of Congress upward of 30,000,000 acres of land were
withdrawn from public sale with a view to applications for grants of
this character pending before Congress. A careful review of the whole
subject led me to direct that all such orders be abrogated and the
lands restored to market, and instructions were immediately given to
that effect. The applications at the last session contemplated the
construction of more than 5,000 miles of road and grants to the
amount of nearly 20,000,000 acres of the public domain. Even
admitting the right on the part of Congress to be unquestionable, is
it quite clear that the proposed grants would be productive of good,
and not evil? The different projects are confined for the present to
eleven States of this Union and one Territory. The reasons assigned
for the grants show that it is proposed to put the works speedily in
process of construction. When we reflect that since the commencement
of the construction of railways in the United States, stimulated, as
they have been, by the large dividends realized from the earlier
works over the great thoroughfares and between the most important
points of commerce and population, encouraged by State legislation,
and pressed forward by the amazing energy of private enterprise, only
17,000 miles have been completed in all the States in a quarter of a
century; when we see the crippled condition of many works commenced
and prosecuted upon what were deemed to be sound principles and safe
calculations; when we contemplate the enormous absorption of capital
withdrawn from the ordinary channels of business, the extravagant
rates of interest at this moment paid to continue operations, the
bankruptcies, not merely in money but in character, and the
inevitable effect upon finances generally, can it be doubted that the
tendency is to run to excess in this matter? Is it wise to augment
this excess by encouraging hopes of sudden wealth expected to flow
from magnificent schemes dependent upon the action of Congress? Does
the spirit which has produced such results need to be stimulated or
checked? Is it not the better rule to leave all these works to
private enterprise, regulated and, when expedient, aided by the
cooperation of States? If constructed by private capital the
stimulant and the check go together and furnish a salutary restraint
against speculative schemes and extravagance. But it is manifest that
with the most effective guards there is danger of going too fast and
too far. We may well pause before a proposition contemplating a
simultaneous movement for the construction of railroads which in
extent will equal, exclusive of the great Pacific road and all its
branches, nearly one-third of the entire length of such works now
completed in the United States, and which can not cost with
equipments less than $150,000,000. The dangers likely to result from
combinations of interests of this character can hardly be
overestimated. But independently of these considerations, where is
the accurate knowledge, the comprehensive intelligence, which shall
discriminate between the relative claims of these twenty eight
proposed roads in eleven States and one Territory? Where will you
begin and where end? If to enable these companies to execute their
proposed works it is necessary that the aid of the General Government
be primarily given, the policy will present a problem so comprehensive
in its bearings and so important to our political and social
well-being as to claim in anticipation the severest analysis.
Entertaining these views, I recur with satisfaction to the experience
and action of the last session of Congress as furnishing assurance
that the subject will not fail to elicit a careful reexamination and
rigid scrutiny. It was my intention to present on this occasion some
suggestions regarding internal improvements by the General
Government, which want of time at the close of the last session
prevented my submitting on the return to the House of Representatives
with objections of the bill entitled "An act making appropriations for
the repair, preservation, and completion of certain public works
heretofore commenced under the authority of law;" but the space in
this communication already occupied with other matter of immediate
public exigency constrains me to reserve that subject for a special
message, which will be transmitted to the two Houses of Congress at
an early day. The judicial establishment of the United States
requires modification, and certain reforms in the manner of
conducting the legal business of the Government are also much needed;
but as I have addressed you upon both of these subjects at length
before, I have only to call your attention to the suggestions then
made.

My former recommendations in relation to suitable provision for
various objects of deep interest to the inhabitants of the District
of Columbia are renewed. Many of these objects partake largely of a
national character, and are important independently of their relation
to the prosperity of the only considerable organized community in the
Union entirely unrepresented in Congress.

I have thus presented suggestions on such subjects as appear to me to
be of particular interest or importance, and therefore most worthy of
consideration during the short remaining period allotted to the
labors of the present Congress.

Our forefathers of the thirteen united colonies, in acquiring their
independence and in rounding this Republic of the United States of
America, have devolved upon us, their descendants, the greatest and
the most noble trust ever committed to the hands of man, imposing
upon all, and especially such as the public will may have invested
for the time being with political functions, the most sacred
obligations. We have to maintain inviolate the great doctrine of the
inherent right of popular self-government; to reconcile the largest
liberty of the individual citizen with complete security of the
public order; to render cheerful obedience to the laws of the land,
to unite in enforcing their execution, and to frown indignantly on
all combinations to resist them; to harmonize a sincere and ardent
devotion to the institutions of religions faith with the most
universal religious toleration; to preserve the rights of all by
causing each to respect those of the other; to carry forward every
social improvement to the uttermost limit of human perfectibility, by
the free action of mind upon mind, not by the obtrusive intervention
of misapplied force; to uphold the integrity and guard the
limitations of our organic law; to preserve sacred from all touch of
usurpation, as the very palladium of our political salvation, the
reserved rights and powers of the several States and of the people;
to cherish with loyal fealty and devoted affection this Union, as the
only sure foundation on which the hopes of civil liberty rest; to
administer government with vigilant integrity and rigid economy; to
cultivate peace and friendship with foreign nations, and to demand
and exact equal justice from all, but to do wrong to none; to eschew
intermeddling with the national policy and the domestic repose of
other governments, and to repel it from our own; never to shrink from
war when the rights and the honor of the country call us to arms, but
to cultivate in preference the arts of peace, seek enlargement of the
rights of neutrality, and elevate and liberalize the intercourse of
nations; and by such just and honorable means, and such only, whilst
exalting the condition of the Republic, to assure to it the
legitimate influence and the benign authority of a great example
amongst all the powers of Christendom.

Under the solemnity of these convictions the blessing of Almighty God
is earnestly invoked to attend upon your deliberations and upon all
the counsels and acts of the Government, to the end that, with common
zeal and common efforts, we may, in humble submission to the divine
will, cooperate for the promotion of the supreme good of these United
States.