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$563,061 39 premiums on loans) towards the extraordinary military and naval expenses of the war.

In addition to these expenses, (without taking into the calculation sundry smaller items,) the number of military land warrants issuable under the act of 11th February, 1847, and the act of August 10, 1648, is to be taken into consideration. Under those acts, 65,171 warrants for 160 acres each, and 5,219 for 40 acres each, have already been issued. Claims to the amount of 9,000 have been suspended or rejected, and it is estimated that the number of claims yet to be presented will amount to 17,000. (See statement marked (1,) hereto annexed.)

The whole amount of warrants issuable under the act above mentioned, may, therefore, be estimated as equal to 90,000 of 160 acres each, which, at $200 each, will aniount to $18,000,000. Of conrse, until these warrants shall be exhausted, a large proportion of the revenue from sales of public lands must be thereby diverted.

My predecessor estimated the revenue from public lands, for the last fiscal year, to be received at the treasury, at $3,000,000.

The actual receipts at the treasury from that source in the year ending 30th of June, 1848, were $3,328,642 56.

During the calendar years 1847 and 1848, and three-quarters of 1849, there were located for patents on military bounty land warrants 5,025,400 acres, amounting, at $1 25 per acre, to the sum of $6,281,750, viz. : In 1847, 239,880 acres,

$ 299,850 00 In 1848, 2,288,960 acres,

2.861,200 00 hof 1849, 2,496,560 acres,

3,120,700 00 5,025,400

$6,281,750 00 See Statement marked (J.)

The receipts at the treasury from sales of public lands during the last fiscal year were $1,688,959 55.

It is not probable that additional sales would have been made to the full extent of the number of acres located under the military bounty land warrants, but I think it may be safely considered that this source of revenue may be taken at nearly $4,000,000, of which a part is absorbed by the land warrants; a part, say $1,657,050, (that being the amount paid and payable during the present fiscal year,) is applied to the payment of interest on the loan and treasury notes, under ihe act of January 28, 1847; and the remainder is pledged to the extinguishment of the debt created under that act. I estimate $2,000,000 per annum of the revenue from lands as diverted by the land warrants and the extinguishment of debt.

During the last fiscal year there were paid, under stipulations in the treaty with Mexico, sums amounting in all to $7.629,108.

Public debt to the amount of $790,566 39 (including treasury notes received for customs and lands,) was also paid off or purchased out of the general funds of the treasury and extinguished, besides $382,500 of the stock and treasury notes issued under the act of 1817, purchased out of the land fund and cancelled. See statement marked (K.) of these sums, $890,175 was new debt contracted since the commencement of the war.

The balance in the treasury, on the 1st of July, 1849, was $2,184,964 28.

The aggregate of these sums, viz.: Balance in the treasury on 1st July, 1849,

$2,184,964 28 Payments under the treaty,

7,629,108 00 Payments out of general fund on account of debt,

790,566 39 Land fund diverted,

2,000,000 00

.

Amounting to,

$12,604,638 67 and would have made a balance in the treasury to that amount on the 1st July,

VOL. III. - DEC., 1849. 35

1819, had none of them been applied to the extraordinary purposes above desig. nated.

During the current fiscal year there will be required, in May next, for the payment of an instalment to Mexico, $3,510,000, and the land revenue estimated as diverted, will be 2,000,000 dollars, making together 5,540,000 dollars, which. added to the aforesaid sum of 12,604,638 dollars and 67 cents, would make 18,144,638 dollars and 67 cents, from which deducting the estimated deficit on the 1st July, 1850, of 5,828,121 dollars and 66 cents, would have left an estimated balance in the treasury, on that day, of 12.316,517 dollars and one cent. Adding to that balance the instalment to Mexico, due in 1851, 3,360,000 dollars, and the revenue from lands diverted, 2,000,000 dollars, would make an aggregate of 17,676,517 dollars and one cent; from which deducting the estimated defcit on the 1st of July, 1851, 10,547,092 dollars and 73 cents, would have made an estimated balance in the treasury, on that day, of 7,129,424 dollars and 28 cents.

I have gone into this detail for the purpose of showing that the resources of the country are ample, that the estimated deficit will have arisen from the extraordinary expenses of the war and treaty with Mexico, and that the justly high public credit of the United States is not endangered by the fact that, in this position of affairs, a new loan will be required.

Under these circumstances, I propose that authority be given to raise such sum, not exceeding $16,500,000 as may be found necessary from time to time, by the issue of stock or treasury notes, on such terms of interest (not exceeding six per cent.) and re-payment, as the president in his discretion shall, previous to their being issued, think fit to order.

Authority has already been given by the act of March 3d, 1849, to issue stock for $3,250,000 appropriated to carry into effect the 15th article of the treaty with Mexico.

To provide for the payment out of the revenue of the instalment which will be due to Mexico in the fiscal year ending 30th June, 1852, to secure the raising of a fund for the gradual extinguishinent of our heavy public debt, and to place the revenue on a sure basis of sufficiency for all the expenditures of the government, it will be necessary to adopt measures for increasing the revenue; and the most available means to that end are to be found in raising the duties on iinports. That an economy as rigid as may be found compatible with the necessities of the country will regulate the appropriations, under existing circumstances, cannot be doubted.

In proposing some alterations in the existing tariff, with a view, as well to the necessary augmentation of the revenue as the encouragement of industry, I think it right to present distinctly the views entertained on the latter subject, in the hope that a course may be adopted by the wisdom and patriotism of Congress which may tend to harmonize discordant feelings and promote the general prosperity.

1. I entertain no doubt of the rightful power of Congress to regulate commerce and levy imposts and duties, with the purpose of encouraging our own industry, In selecting for adoption one of iwo proposed regulations of commerce, it would appear to be clearly the right of Congress to choose that one which would, in its opinion, be most salutary to the country; and, in like manner, in laying imposts and duties, it would seein that the endeavour ought to be to regard the interests of the whole people, not as little, but as much as possible.

It is not a question of assuming a power not expressly granted hy the constitation, on the ground that it may tend to the attainment of a general end therein expressed. Here the power to regulate commerce, and the power to levy and colleet duties, are expressly given, and the only question is, whether they ought or ought not to be exercised with a view to the general good.

It seems to me, that to exercise these or any other powers with any other view, would be a misuse of power, and subversive of the legitimate end of government

I find no obligation written in the constitution to lay taxes, duties or imposts, at the lowest rate that will yield the largest revenue.

If it were true, that a doiy laid on a given article with a view to encourage our own productions is unlawful, because it may operate, by discouraging importation, as a partial prohibition, the proposition would be equally true of every duty laid with that intent, whether it were above or below the maximum revenue rate. But, as under the power to regulate commerce, it is competent for Congress to enact a direct and total prohibition of the importation of any article, it can be no objection to an art levying duties, that it may operate in partially preventing importation. Whether it be wise or just so to levy duties, is another question. What I mean to say now is, that there is no prohibition of it in the constitution, The proposition is maintained, as universally true, that the express grant of a power to Congress gives to that body the right of exercising that power in such manner as, in its opinion, may be most conducive to the advantage of the country.

As instances of the exercise of the power of regulating commerce, may be mentioned the prohibition of importations, except at designated ports; the prohibition of the coasting trade to all foreign vessels, and to all American vessels, not licensed and enrolled; the prohibition of certain trade to foreign vessels under the navigation act of 1817; the prohibition of certain trade to American vessels by the non-intercourse act, and of all trade by the embargo act; the drawback on the re-esportation of foreign goods; finally, the prohibition of the introduction of adulterated drags into the country by the act of 26th July, 1848.

Under the power to levy taxes, duties and imposts, I refer to the discriminating tonnage duties on foreign vessels, the discriminating duties on their cargoes, the preamble to the first law imposing duties passed under the constitution, and the enartments of most of the subsequent ones.

These enactments show that at most or all periods of our history the views which I have expressed appear to have been sustained and acted on.

II. All legislation designed to favour a particular class to the prejudice of others, or to injure a particular class for the benefit of others, is manifestly unwise and unjust. Nothing can be more destructive of the true interests of the couniry than such legislation, except the refusal of really salutary legislation, under an erroneous impression that it might favour one class to the prejudice of others, while in fact the denial of it injures all classes, and benefits nobody.

III. As every producer in one branch of useful industry is also a consumer of the products of others, and as his ability to consume depends upon the profits of his production, it follows that to give prosperity to one branch of industry is to increase that of the rest. Within each branch of industry there will be individual rivalry; but among the several branches of useful industry there must always exist an unbroken harmony of interest.

Nó country can attain a due strength of prosperity that does not by its own Jabonr carry its own productions, as nearly as possible, to the point necessary to fit them for ultimate consomption. To export iis raw material and re-import the articles manufactured from it, or to neglect its own raw materials and import the articles manufactured from that of another country, is to pretermit the means which nature has provided for its advancement.

For instance, we exported, during the fiscal year, ending 30th June, 1849, raw cotion to the value of about sixty-six millions of dollars. If that collon had been spun and woven at home, (supposing its value to be increased four-fold by manufacture.) it would have produced a value of about one hundred and ninetyeight millions in addition. What would have been the effect of this increased pro luction on the prosperity of the country?

This question would not be completely answered by merely pronouncing the added value of one hundred and ninety eight millions of dollars to be a large profit to the manufacturer, any more than the question of the effect of the production of wheat would be answered by deducting the cost of seed wheat froma

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the value of the crop, and pronouncing the remainder to be a large profit to the farmer.

The manufacture of cotton cloth is begun with the planting of the cotton-it is carried to a certain point by the planter, and then taken op and perfected by the spinner and weaver. The planter and manufacturer are not engaged in dif. ferent branches of industry, bui in the same—the one commences the process which the other completes. Cotton-seed of insignificant value, being by regular stages of labour developed and brought to the form of cotton cloth, has acquired a value of about two hundred and sixty-four millions.

The planting States have added many millions to the annual productions of the country by the culture of cotton. By continuing the process, they could quadruple that addition.

The planter would then have a market at his door for all his produce, and the farmer would, in like manner, have a home market for his. The power of consumption of not only breadstuffs, but of every article useful or necessary in the feeding, clothing, and housing of man, would be vastly increased—the consumer and producer would be brought nearer to each other—and in fact a stimulus would be applied to every branch of productive industry.

It is gratifying to know that the manufacture of cotton has already been introduced into several of the planting States (see document marked (W) hereto annexed,) and it ought not to be doubted will rapidly be extended.

The manufacture of iron, wool, and other staples would lead to similar results. The effect would be a vast augmentation of our wealth and power.

Upon commerce the effects might be expected to be, if possible, still more marked. It is not enough to say that no country ever diminished its commerce by increasing its productions—and that no injury would therefore result to that interest. There would probably be not only a great increase in the amount, but an improvement not less important in the nature of our commerce.

Of the immense addition that would accrue to our internal and coasting trade, (which in every country form the great and most valuable body of commerce,) it is unnecessary to do more than merely speak in passing—but it may be well to offer a few remarks on foreign commerce.

Commerce is the machinery of exchange. It is the handmaid of agriculture and manufactures. It will not be affirmed that it is ever positively injuriousbut it will be more or less useful as it co-operates more or less with the productive industry of the country. The mere carriage of commodities by sea or land is necessarily profitable only to the carrier, who is paid for it. It may be useful or not to others, according to circumstances. The farmer finds a rail-road a great convenience, but he understands that it is better employed in carrying his crop than in carrying away his seed-wheat and manure.

The commerce which should consist in carrying cotton-seed abroad, to be there grown, would not be so useful as that which is now occupied in exporting the raw cotton grown at home. We should easily understand, also, that the commerce thus employed would be much more limited in amount and much less profitable to the carriers than what we now have. Yet our present commerce is, in fact, of the same nature with that above described. The seed bears to the cotton the same relation which the cotton bears to the cloth. If we now export cotton of the value of about sixty-six millions, the same cotton, when converted into cloth, would make an export of some two hundred and sixty-four millions, or some two hundred and forty-five millions after deducting the fifteen or twenty millions which would be required for our own consumption, (in addition to the portion of our present manufactures consumed at home.) and our imports would be thereby in like manner increased.

England, at this moment, derives a large portion of her power from spinning and weaving our cotton. When we shall spin and weave it ourselves, make our own iron, and manufacture our other staples, we shall have transferred to

this country the great centres of wealth, commerce, civilization, and political, as well as moral and intellectual power.

At present, we are far from having the amount of foreign commerce which is due to our position, as a vastly productive country, with an extensive coast, good harbours, great internal water-courses, and a people unsurpassed in maritime skill and enterprise.

Our annual products were estimated by my predecessor in this department, at three thousand million dollars, while our average exports are about one hundred and thirteen millions, and our imports about one hundred and six millions, making together two hundred and nineteen millions, exclusive of gold and silver and of foreign commodities imported and re-exported. An eminent British authority estimates the annual creation of wealth in Great Britain and Ireland, at between two thousand one hundred, and two thousand two hundred millions. If we add, for articles omitted by him, between three and four hundred millions, we shali have a total of two thousand five hundred millions.

The British exports and imports amount annually to about five hundred and twenty millions, exclusive of gold and silver, and of foreign commodities imported and re-exported. If their foreign trade were brought down to our scale upon this estimate, it would be reduced to about one hundred and eighty-three millions. If ours were raised to their scale, it would reach about six hundred and twenty-four millions.

Estimating the population of Great Britain and Ireland at thirty millions, and our population at twenty.one millions, their foreign trade averages $17 33 for each individual; ours $10 42, If their foreign trade were no greater than ours, in proportion to population, it would be reduced from five hundred and twenty tó three hundred and twelve millions. If our foreign trade were as great in proportion to population as is theirs, it would be swelled in amount from two hundred and nineteen to three hundred and sixty-four millions.

A leading cause of the existing difference is to be found in the fact that Great Britain exports chiefly what she has first brought to the form in which it is ready for ultimate consumption; it is at the stage of its highest valae, and her market is almost co-extensive with the civilized world.

All history shows that where are the workshops of the world, there must be the marts of the world, and the heart of wealth, commerce and power. It is as vain to hope to make these marts by providing warehouses, as it would be to make a crop by building a barn.

IV. Whether we can have workshops to work up, at least, our own materials, must depend upon the question, whether we have or can obtain sufficient advantages to justify the pursuit of this kind of industry.

The circumstances favourable to production in this country may be stated to be: 1st. Facility in procuring raw materials. 2d. Abundance of fuel. 3d. Abundance of food and other articles necessary for the sustenance and housing of the labourer. 4th. The superior efficiency of the labourers in comparison with those of other countries.

The circumstances supposed to be unfavourable to our production may be thus classed

1st. Want of capital. 2d. Dearness of our labour as compared with that of other countries. 3d. Insecurity by exposure to the influence of violent and excessive fluctuations of price in foreign markets, and to undue foreign competition.

ist. Capital, which is but the accumulated savings of labour, is believed to be abundant among ourselves for any purpose to which it can be profitably applied. It is more divided than in some other countries, and associations of capital are therefore more common among us than elsewhere. It will be increased by the labour of every successive year, and for investments reasonably secure, it will flow in whenever required, as it has always heretofore done, from other cou ntries

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