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who may be proved to have been guilty of il- | Executive proclamation, legislation during the legal acts of violence toward citizens of the continuance of such extra session shall be conUnited States, and also toward indemnifying fined to such subjects as the Executive may those who may be shown to be entitled to in bring before it, from time to time, in writing. demnity. A copy of a protocol of a conference The advantages to be gained by these two between the Secretary of State and the Spanish | amendments are too obvious for me to comment minister, in which the terms of this arrange- upon them. One session in each year is proment were agreed to, is transmitted herewith. vided for by the Constitution, in which there

The correspondence on this subject with the are no restrictions as to the subjects of legislalegation of the United States in Madrid was con- tion by Congress. If more are required, it is ducted in cipher and by cable, and needs the always in the power of Congress, during their verification of the actual text of the correspond term of office, to provide for sessions at any ence. It has seemed to me to be due to the time. The first of these amendments would proimportance of the case not to submit this corres- tect the public against the many abuses, and pondence until the accurate text can be received waste of public moneys, which creep into approby mail. It is expected shortly, and will be priation bills, and other important measures submitted when received.

I passing during the expiring hours of Congress, In taking leave of this subject for the present, to which, otherwise, due consideration cannot be I wish to renew the expression of my conviction, I given. that the existence of African slavery in Cuba is The receipts of the Government from all a principal cause of the lamentable condition of sources for the last fiscal year were $333,738,204, the island. I do not doubt that Congress shares and expenditures on all accounts $290,345, 245, with me the hope that it will soon be made to thus showing an excess of receipts over expendidisappear, and that peace and prosperity may tures of $43,392,959. But it is not probable that follow its abolition.

this favorable exhibit will be shown for the The embargoing of American estates in Cuba; present fiscal year. Indeed, it is very doubtful cruelty to American citizens detected in no act whether, except with great economy on the part of hostility to the Spanish Government; the of Congress in making appropriations, and the murdering of prisoners taken with arms in their same economy in administering the various dehands; and, finally, the capture upon the high partments of Government, the revenues will not seas of a vessel sailing under the United States fall short of meeting actual expenses, including flag and bearing a United States registry, have interest on the public debt. culminated in an outburst of indignation that I commend to Congress such economy, and has seemed for a time to threaten war. Pending point out two sources where, it seems to me, it negotiations between the United States and the might commence, to wit, in the appropriations government of Spain on the subject of this cap- for public buildings in the many cities where ture, I have authorized the Secretary of the work has not yet been commenced; in the apNavy to put our Davy on a war footing, to the propriations for river and harbor improvement extent, at least, of the entire annual appropria- in ihose localities where the improvements are tion for that branch of the service, trusting to of but little benefit to general commerce, and Congress and the public opinion of the American for fortifications. people to justify my action.

There is a still more fruitful source of expendiAssuming from the action of the last Congress, ture, which I will point out later in this message. in appointing a “Committee on Privileges and I refer to the easy method of manufacturing Elections,” to prepare and report to this Con- claims for losses incurred in suppressing the late gress a constitutional amendment to provide a rebellion. better method of electing the President and Vice I would not be understood here as opposing President of the United States, and also from the erection of good, substantial, and even ornathe necessity of such an amendment, that there mental buildings by the Government wherever will be submitted to the State Legislatures, for such buildings are needed. In fact, I approve ratification, such an improvement in our Con- of the Government owning its own buildings in stitution, I suggest two others for your consid | all sections of the country, and hope the day is eration :

not far distant when it will not only possess First. To authorize the Executive to approve them, but will erect in the capital suitable resiof so much of any measure passing the two dences for all persons who now receive commuHouses of Congress as his judgment may dictate, tation for quarters or rent at Government expense, without approving the whole, the disapproved and for the Cabinet, thus setting an example to portion, or portions, to be subjected to the same the States which may induce them to erect buildrules as now, to wit, to be referred back to the ings for their Senators. But I would have this House in which the measure, or measures, orig. work conducted at a time when the revenues of ipated, and it passed by a two-thirds vote of the the country would abundantly justify it. two Houses, then to become a law without the The revenues have materially fallen off for the approval of the President. I would add to this first five months of the present fiscal year from a provision that there should be no legislation what they were expected to produce, owing to the by Congress during the last twenty-four hours general panic now prevailing, which commenced of its sitting, except upon vetoes, in order to give about the middle of September last. The full the Executive an opportunity to examine and effect of this disaster, if it should not prove a approve or disapprove bills understandingly. “ blessing in disguise,” is yet to be demonstrated.

Second. To provide, by amendment, that when In either event it is your duty to heed the lesson, an extra session of Congress is convened by land to provide, by wise and well-considered legislation, as far as it lies in your power, against its in part at best, to the merchant or manufacturer recurrence, and to take advantage of all benefits for a fixed term. Hence, no matter how much that may have accrued.

currency there might be in the country, it would My own judgment is that, however much in- be absorbed, prices keeping pace with the volume, dividuals may have suffered, one long step has and panics, stringency, and disasters would ever been taken toward specie payments; that we be recurring with the autumn. Elasticity in can never have permanent prosperity until a our monetary system, therefore, is the object to specie basis is reached; and that a specie basis be attained first, and next to that, as far as poscannot be reached and maintained until our ex- sible, a prevention of the use of other people's ports, exclusive of gold, pay for our imports, money in stock and other species of speculation. interest due abroad, and other specie obligations, To prevent the latter it seems to ine that one or so nearly so as to leave an appreciable accu great step would be taken by prohibiting the mulation of the precious metals in the country national banks from paying interest on deposits, from the products of our mines.

by requiring them to hold their reserves in their The development of the mines of precious own vaults, and by forcing them into resumpa metals during the past year, and the prospective tion, though it would only be in legal-tender development of them for years to come, are grati- notes. For this purpose I would suggest the fying in their results. Could but one-half of the the establishment of clearing-houses for your gold extracted from the mines be retained at consideration. home, our advance toward specie payments would To secure the former many plans have been be rapid.

suggested, most if not all of which look to me To increase our exports sufficient currency is more like inflation on the one hand, or compellrequired to keep all the industries of the country ing the Government, or the other, to pay interemployed. Without this national as well as in- est, without corresponding benefits, upon the dividual bankruptcy must ensue. Undue infla- surplus funds of the country during the seasons tion, on the other hand, while it might give when otherwise unemployed. temporary relief, would only lead to inflation of! I submit for your consideration whether this prices, the impossibility of competing in our own difficulty might not be overcome by authorizing markets for the products of home skill and labor, the Secretary of the Treasury to issue at any and repeated renewals of present experiences. time to national banks of issue any amount of Elasticity to our circulating medium, therefore, their own notes below a fixed percentage of and just enough of it to transact the legitimate their issue, say forty per cent., upon the banks business of the country, and to keep all indus- depositing with the Treasurer of the United tries employed, is what is most to be desired. States an amount of Government bonds equal to The exact medium is specie, the recognized me the amount of notes demanded, the banks to dium of exchange the world over. That obtained, forfeit to the Government, say four per cent. ot we shall have a currency of an exact degree of the interest accruing on the bonds so pledged elasticity. If there be too much of it for the during the time they remain with the Treasurer, legitimate purposes of trade and commerce, it as security for the increased circulation, the will flow out of the country. If too little, the bonds so pledged to be redeemable by the banks reverse will result. To hold what we have, and at their pleasure, either in whole or in part, by to appreciate our currency to that standard, is returning their own bills for cancellation to an the problem deserving of the most serious con- amount equal to the face of the bonds with. sideration of Congress.

drawn. I would further suggest for your conThe experience of the present panic has proven sideration the propriety of authorizing national that the currency of the country, based as it is banks to diminish their standing issue at pleasupon the credit of the country, is the best that ure, by returning for cancellation their own bills has ever been devised. Usually, in times of and withdrawing so many United States bonds such trials, currency has become worthless, or so as are pledged for the bills returned. much depreciated in value as to inflate the values In view of the great actual contraction that of all the necessaries of life, as compared with has taken place in tbe currency, and the comthe currency Every one holding it has been parative contraction continuously going on, due anxious to dispose of it on any terms. Now we to the increase of population, increase of manuwitness the reverse. Holders of currency hoard factories, and all the industries, I do not believe it as they did gold in former experiences of a there is too much of it now for the dullest period like nature.

of the year. Indeed, if clearing houses should It is patent to the most casual observer that be established, thus forcing redemption, it is a much more currency or money is required to question for your consideration whether banktransact the legitimate trade of the country dur- ing should not be made free, retaining all the ing the fall and winter months, when the vast safeguards now required to secure billholders. crops are being removed, than during the bal. In any modification of the present laws regulatance of the year. With our present system the ing national banks, as a further step toward amount in the country remains the same through- preparing for resumption of specie payments, I out the entire year, resulting in an accumulation invite your attention to a consideration of the of all the surplus capital of the country in a few propriety of exacting from them the retention, centers, when not employed in the moving of as a part of their reserve, either the whole or a crops, tempted there by the offer of interest on part of the gold interest accruing upon the bonds call loans. Interest being paid, this surplus pledged as security for their issue. I have not capital must earn this interest paid with a profit. reflected enough on the bearing this might have Being subject to "call,” it cannot be loaned, only lin producing a scarcity of coin with which to pay duties on imports to give it my positive. There is one work, however, of a national recommendation. But your attention is invited character, in which the greater portion of the to the subject.

East and the West, the North and the South, are During the last four years the currency has equally interested, to which I will invite your been contracted directly by the withdrawal of attention. three per cent. certificates, compound-interest The State of New York has a canal connectnotes, and "seyen-thirty" bonds outstanding on ling Lake Erie with tide-water on the Hudson the 4th of March, 1869, all of which took the river. The State of Illinois has a similar place of legal tenders in the bank reserves to the work connecting Lake Michigan with navigable extent of sixty-three million dollars,

water on the Illinois river, thus making waterDuring the same period there has been a much communication inland, between the East and larger comparative contraction of the currency. the West and South. These great artificial The population of the country has largely in water-courses are the property of the States creased. More than twenty-five thousand miles through which they pass, and pay toll to those of railroad have been built, requiring the active States. Would it not be wise statesmanship to use of capital to operate them. “Millions of acres pledge these States that if they will open these of land have been opened to cultivation, requir- canals for the passage of large vessels the Gening capital to move the products. Manufactories eral Government will look after and keep in have multiplied beyond all precedent in the same navigable condition the great public highways period of time, requiring capital weekly for the with which they connect, to wit: the overslaugh payment of wages and for the purchase of ma- on the Hudson, the Saint Clair flats, and the terial; and probably the largest of all compara- Illinois and Mississippi rivers? This would be tive contraction arises from the organizing of a national work; one of great value to the profree labor in the South. Now every laborer ducers of the West and South in giving them there receives his wages, and for want of sav- cheap transportation for their produce to the ings banks, the greater part of such wages is sea-board and a market; and to the consumers carried in the pocket or hoarded until required in the East in giving them cheaper food, parfor use.

ticularly of those articles of food which do not These suggestions are thrown out for your find a foreign market, and the prices of which, consideration, without any recommendation that therefore, are not regulated by foreign demands. they shall be adopted literally, but hoping that The advantages of such a work are too obvious the best method may be arrived at to secure for argument. I submit the subject to you, such an elasticity of the currency as will keep therefore, without further comment. employed all the industries of the country, and prevent such an inflation as will put off indefi- In further connection with the Treasury Denitely the resumption of specie payments, an partment I would recommend a revision and object so devoutly to be wished for by all, and codification of the tariff laws, and the opening by none more earnestly than the class of peo- of more mints for coining money, with authority ple most directly interested—those who "earn to coin for such nations as may apply. their bread by the sweat of their brow." The decisions of Congress on this subject will have During the past year our navy has been dethe hearty support of the Executive.

pleted by the sale of some vessels no longer fit In previous messages I have called attention for naval service, and by the condemnation of to the decline in American ship building, and others not yet disposed of. This, however, has recommended such legislation as would secure been more than compensated for by the repair of to us our proportion of the carrying trade. six of the old wooden ships, and by the building Stimulated by high rates and abundance of of eight new sloops of war, authorized by the last freight, the progress for the last year in ship Congress. The building of these latter has ocbuilding has been very satisfactory. There has curred at a doubly fortunate time. They are been an increase of about three per cent in the about being completed at a time when they may amount transported in American vessels over possibly be much needed, and the work upon the amount of last year. With the reduced cost them has not only given direct employment to of material which has taken place, it may rea- thousands of men, but has no doubt been the sonably be hoped that this progress will be means of keeping open establishments for other maintained and even increased. However, as work at a time of great financial distress. we pay about $80,000,000 per annum to foreign Since the commencement of the last month, vessels for the transportation to a market of our however, the distressing occurrences which have surplus products, thus increasing the balance of taken place in the waters of the Caribbean sea, trade against us to this amount, the subject is almost on our very sea-board, while they illusone worthy of your serious consideration. trate most forcibly the necessity always existing

" Cheap transportation" is a subject that has that a nation situated like ours should maintain attracted the attention of both producers and in a state of possible efficiency a navy adequate consumers for the past few years, and has con to its responsibilities, has at the same time detributed to, if it has not been the direct cause of, manded that all the effective force we really have the recent panic and stringency

shall be put in immediate readiness for warlike As Congress, at its last session, appointed a service. This has been and is being done promptspecial committee to investigate this whole sub- ly and effectively, and I am assured that all the ject during the vacation, and report at this ses available ships and every authorized man of the sion, I have nothing to recommend until their American navy will be ready for whatever acreport is read.

I tion is required for the safety of our citizens or

the maintenance of our honor. This, of course, 'jury trials in the district courts of that Territory will require the expenditure in a short time of since the last session of Congress. Property is some of the appropriations which were calculated left without protection by the courts, and crimes to extend through the fiscal year, but Congress go unpunished. To prevent anarchy there, it is will, I doubt not, understand and appreciate the absolutely necessary that Congress provide the emergency, and will provide adequately, not courts with some mode of obtaining jurors, and only for the present preparation, but for the I recommend legislation to that end; and also future maintenance of our naval force. The that the probate courts of the Territory, now Secretary of the Navy has, during the past year, assuming to issue writs of injunction and habeas been quietly putting some of our most effective corpus, and to try criminal cases and questions monitors in condition for service, and thus the as to land titles, be denied all jurisdiction not exigency finds us in a much better condition for possessed ordinarily by courts of that descripwork than we could possibly have been without tion. his action.

I have become impressed with the belief that A complete exhibit is presented, in the accom- i the act approved March 2, 1867, entitled "An panying report of the Postmaster General, of the act to establish a uniform system of bankruptcy operations of the Post Office Department during throughout the United States," is productive of the year. The ordinary postal revenues for the more evil than good at this time. Many considfiscal year ended June 30, 1873, amounted to erations might be urged for its total repeal, but, $22,996,741 57, and the expenditures of all kinds if this is not considered advisable, I think it will to $29,084,945 67. The increase of revenues not be seriously questioned that those portions over 1872 was $1,081,315 20, and the increase of said act providing for what is called involunof expenditures $2,426,753 36.

tary bankruptcy operate to increase the financial Independent of the payments made from spe- embarrassments of the country. Careful and cial appropriations for mail-steamship lines, the prudent men very often become involved in debt amount drawn from the general Treasury to in the transaction of their business, and though meet deficiencies was $5,265,475. The constant they may possess ample property, if it could be and rapid extension of our postal service, par- made available for that purpose, to meet all ticularly upon railways, and the improved facili- ' their liabilities, yet, on account of the extraorties for the collection, transmission, distribution, dinary scarcity of money, they may be unable and delivery of the mails, which are constantly to meet all their pecuniary obligations as they being provided, account for the increased expen- become due, in consequence of which they are ditures of this popular branch of the public liable to be prostrated in their business by proservice.

ceedings in bankruptcy at the instance of upreThe total number of post offices in operation lenting creditors. People are now so easily on June 30, 1873, was 33,244, a net increase of alarmed as to monetary matters that the mere of 1,381 over the number reported the preceding filing of a petition in bankruptcy by an unyear. The number of presidential offices was friendly creditor will necessarily embarrass, and 1,363, an increase of 163 during the year. The oftentimes accomplish the financial ruin of a retotal length of railroad mail-routes at the close sponsible business man. Those who otherwise of the year was 63,457 miles, an increase of might make lawful and just arrangements to 5,546 miles over the year 1872. Fifty-nine' relieve themselves from difficulties produced by railway post-office lines were in operation June the present stringency in money, are prevented 30, 1873, extending over 14,866 miles of rail- by their constant exposure to attack and disaproad routes, and performing an aggregate service pointment by proceedings against them in bankof 34,925 miles daily.

ruptcy, and, beside, the law is made use of in The number of letters exchanged with foreign many cases by obdurate creditors to frighten or countries was 27,459,185, an increase of 3,096,685 force debtors into a compliance with their wishes over the previous year, and the postage thereon and into acts of injustice to other creditors and amounted to $2,021,310 86. The total weight to themselves. I recommend that so much of of correspondence exchanged in the mails with said act as provides for involuntary bankruptcy European countries exceeded 912 tons, an in- on account of the suspension of payment be recrease of 92 tons over the previous year. The pealed. total cost of the United States ocean-steamship Your careful attention is invited to the subject service, including $725,000 paid from special of claims against the Government, and to the appropriations to subsidized lines of mail steam- facilities afforded by existing laws for their proseers, was $1,047,271 35.

cution. Each of the Departments of State, *

Treasury, and War have demands for many Affairs in Utah require your early and special millions of dollars upon their files, and they are attention. The Supreme Court of the United rapidly accumulating. To these may be added States, in the case of Clinton vs. Englebrecht, de- those now pending before Congress, the Court of cided that the United States marshal of that Claims, and the Southern Claims Commission, Territory could not lawfully summon jurors for making in the aggregate an immense sum. Most the district courts; and those courts hold that of these grow out of the rebellion, and are inthe territorial marshal cannot lawfully perform tended to indemnify persons on both sides for that duty, because he is elected by the legislative their losses during the war; and not a few of assembly and not appointed as provided for in them are fabricated and supported by false testhe act organizing the Territory. All proceed timony. Projects are on foot, it is believed, to ings at law are practically abolished by these induce Congress to provide for new classes of decisions, and there have been but few or no claims, and to revive old ones through the repeal or modification of the statute of limitations, by wealthy people, desirous of enjoying civil and which they are now barred. I presume these religious liberty; and the acquisition of so schemes, if proposed, will be received with little large an immigration of citizens of a superior favor by Congress, and I recommend that per-class would, without doubt, be of substantial sons having claims against the United States, benefit to the country. I invite attention to the cognizable by any tribunal or department there- suggestion of the Secretary of the Interior in of, be required to present them at an early day, this behalf. and that legislation be directed as far as practi- There was paid during the last fiscal year for cable to the defeat of unfounded and unjust de- pensions, including the expense of disbursement, mands upon the Government; and I would $29,185,289 62, being an amount less by $984,suggest, as a means of preventing fraud, that 050 98 than was expended for the same purpose witnesses be called upon to appear in person to the preceding year. Although this statement of testify before those tribunals having said claims expenditures would indicate a material reduction before them for adjudication. Probably the in amount compared with the preceding year, it largest saving to the national Treasury can be is believed that the changes in the pension laws secured by timely legislation on these subjects at the last session of Congress will absorb that of any of the economic measures that will be amount the current year. At the close of the proposed.

last fiscal year there were on the pension rolls .*

99,804 invalid military pensioners and 112,088 The policy inaugurated toward the Indians at widows, orphans, and dependent relatives of dethe beginning of the last administration has ceased soldiers, making a total of that class of been steadily pursued, and, I believe, with bene- 211,892; 18,2611 survivors of the war of 1812, ficial results. It will be continued with only and 5.053 windows of soldiers of that war pensuch modifications as time and experience may sioned under the act of Congress of February 14, demonstrate as necessary.

1871, making a total of that class of 23,319;

1,430 invalid navy pensioners, and 1,770 widThe business of the General Land Office ex- ows, orphans, and dependent relatives of deceased hibits a material increase in all its branches officers, sailors, and marines of the navy, making during the last fiscal year. During that time a total of navy pensioners of 3,200, and a grand there were disposed of, out of the public lands, total of pensioners of all classes of 238,411, show13,030,606 acres, being an amount greater by ing a net increase during the last fiscal year of 1,165,631 acres than was disposed of during the 6,182. During the last year the names of 16,405 preceding year. Of the amount disposed of 1,- pensioners were added to the rolls, and 10,223 626,266 acres were sold for cash; 214,940 acres names were dropped therefrom for various causes. were located with military land warrants; 3,793,612 acres were taken for homesteads; 653, The ninth census has been completed, the re446 acres were located with agricultural college port thereof published and distributed, and the scrip; 6,083,536 acres were certified by rail. working force of the bureau disbanded. The roads; 76,576 acres were granted to wagon Secretary of the Interior renews his recommendroads; 238,548 acres were approved to States as ation for a census to be taken in 1875, to which swamp lands; 138,681 acres were certified for subject the attention of Congress is invited. The agricultural colleges, common schools, universi- original suggestion in that behalf has met with ties, and seminaries; 190,775 acres were ap- the general approval of the country, and even if proved to States for internal improvements; and it be not deemed advisable at present to provide 14,222 acres were located with Indian scrip. for a regular quinquennial census, a census taken The cash receipts during the same time were in 1875, the report of which could be completed $3,408,515 50, being $190,415 50 in excess of and published before the one hundredth annithe receipts of the previous year. During the versary of our national independence, would be year 30,488,132 acres of public land were sur especially interesting and valuable, as showing veyed, an increase over ihe amount surveyed | the progress of the country during the first centhe previous year of 1,037,193 acres, and, added tury of our national existence. It is believed, to the area previously surveyed, aggregates however, that a regular census every five years 616,554,895 acres which have been surveyed, would be of substantial benefit to the country, leaving 1,218,443,505 acres of the public land inasmuch as our growth hitherto has been so still unsurveyed.

rapid that the results of the decennial census are The increased and steadily increasing facilities necessarily unreliable as a basis of estimates for for reaching our unoccupied public domain, and the latter years of a decennial period. for the transportation of surplus products, en- Under the very efficient management of the large the available field for desirable homestead Governor and the Board of Public Works of this locations, thus stimulating settlement and ex- District the city of Washington is rapidly assumtending year by year in a gradually increasing ing the appearance of a capital of which the ratio the area of occupation and cultivation. nation may well be proud. From being a most

The expressed desire of the representatives of unsightly place three years ago, disagreeable to a large colony of citizens of Russia to emigrate pass through in summer in consequence of the to this country, as is understood, with the con- dust arising from unpaved streets, and almost sent of their Government, if certain concessions impassable in the winter from the mud, it is now can be made to enable them to settle in a com- one of the most sightly cities in the country, and pact colony, is of great interest, as going to can boast of being the best paved. show the light in which our institutions are The work has been done systematically, the regarded by an industrious, intelligent, and plans, grades, location of sewers, water and gas

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