Year: 1869

of interest not exceeding four and hall
per cent and as rapidly as the remainder
becomes due that they may be replaced in
| the same way. To accomplish thisit may
be necessary to authorize the interest to be
paid at either of the three or four of the
money centres of Europe, or by any As.
sistant Treasurer of the United States, al
the option of the holder of the bond
suggest this subject for the consideration
of Congress; also simultaneously with
this, the propriety of redeeming our cur
rency as before suggested, at its market
value, at the time the law goes into effect


increasing the rate at which the currency
will be bought,and sold from day to day OF
week to week at the same rate of interest
as the Government pays upon its bonds.


The subject of the tariff and internal
taxation will necessarily receive your at.
tention. The revenues of the country are
greater than the requirements, and may
with safety be reduced, but as the funding
of the debt in four or four and q hall
per cent. loan would reduce the annual
current expense largely, thus, after fund.
ing justifying greater reduction OF tax.
alton than would be now expedient,
suggest a postponement of this question
until the next meeting of Congress. II
may be advisable to modify taxation and
tariff in instances where unjust or burden.
some determinations are made by the
present laws, but a general revision of the
laws regulating this subject, recommend
the postponement of for the present.


7 also suggest the renewal of the tax on
incomes, but at a reduced rate, say OF y
per cent, and this tax to expire in three
years, with the funding of the national
debt, as here suggested.


feel safe in saying that the taxes and
revenue from imports may be reduced
safely from sixty to eighty millions per
annum at once, and be still further reduced
from year to year, as the resources OF the
country are developed.


The report of theSecretary OF the Treas
ury shows the receipts of the govern
ment for the fiscal year ending June 30,
1869, to be 1870, ,943, TAT, and the expendi-
lures, including interest, etc, to be $321,-
490,597 The estimates for the ensuing
year are more favorable to the govern
ment, and will, no doubt, show large de-
crease ofthe public debt. The receipts in
the Treasury beyond expenditures have
exceeded the amount necessary to place to
the credit of the sinking fund, as provided
by law. To lock up the surplus in the
Treasury, and withhold it from circulation,
would lead to such a contraction of the
currency as to cripple trade and seriously
affect the prosperity of the country. I'm.
der these circumstances the Secretary OF
the Treasury and myself heartily con-
CURED in the propriety of using all sur
plus currency in the Treasury in the pur-
chase of government bonds, thus reducing
the interest bearing debt of the country,
and of submitting to Congress the ques-
ton of the disposition to be made of the
bonds so purchased. The bonds now held
by.the Treasury amount to about $75 ,O0O,-
900, including those belonging to the sink
ing fund. / recommend that the whole be
placed to the credit of the sinking fund.


Your attention is respectfully invited to
the recommendations of the Secretary of
the Treasury for the creating of the office
of Commissioner of Customs Revenue !;
for the increase of salary to certain classes
of officials; and the substitution OF in
creased national bond circulation to re-
place the outstanding 8 per cent certifi-
Gates, and more especially to his recon-
mendation for the repeal of laws allowing
shares of fines, penalties, forfeitures, etc,
to officers of the government, or to in
formers


The office of Commissioner of Internal
Revenue is one of the most arduOus and
responsible under the government. 1t falls
but little, if any, short of aCabinet position
Ia its importance and responsibilities. l
would ask for it, therefore, such legislation
as, in your judgment, will place the office
on footing of dignity commensurate with
its importance, and with character and
qualifications of the class of men required
to fill it properly.


As the United States is the freest of all
nations, 80, too, its people sympathise with
all people struggling for liberty and self
government; but while so sympathising,
It is due to our honor that we should alb
stain from enforcing our views upon un-
willing nations, and from taking an inter
ested part, without invitation, in the quar-
rels between different nations or be-
tween governments and their subjects.
Our course should always be in conform
ity with strict justice and law, information
al and local. Such has been the policy OF
the administration in dealing with these
questions. For more than year vain
able province of Spain and near neigh
Dor of ours, in whom all our people can
not but feel deep interest, has been strug-
Cling for independence and freedom.


The people and government of the
United States entertain the same warm
feelings and sympathies for the peo-
pie of Cuba in their pending strug-
gle that they manifested through
out the previous struggles between Spain
and former colonies in behalf of the latter /;
but the contest at no time assumed the
conditions which amount to war in the
senses of international law, or which
would show the existence of de fdct0 pO-
litical organization of the insurgents, suf-
ficient to justify recognition of belliger-
ency. The principle is maintained, how
ever, that this nation is It's own Judge when
to accord the rights of belligerency either
to people struggling to free themselves
from a government that they believe to be
oppressive, OF to independent nations at
war with each other. The United States
have no disposition to interfere with the
existing relations of Spain to her colonial
possessions on this continent. They be-
1ieve that in due time Spain and other
European Powers will find their interest
in terminating those relations and estab-
fishing theiipresent dependencies as indie
pendent Powers--members of the family OF
nations. These dependencies are no longer
regarded as subject to transfer from one
European power to another. When the
present relation of colonies cease, they are
to become Independent powers, exercising
the right of choice and of selfcontrol IN
the determination of their future condi-
ton and relations with other powers. The
United States in order to put stop to
bloodshed in Cuba, and in the interest
of neighboring people, profered their
good offices to bring the existing con-
test to q termination. The offer
not being accepted by Spain on basis
which we believed could be received by
Cuba, it was withdrawn 1t is hoped that
the good offices of the United States may
yet prove advantageous for the settlement
of this unhappy strife. Meanwhile a
number ofillegai expeditions against Cuba
have been broken up. 1t has been the en-
deavor of the Administration to execute
the neutrality laws in good faith, no mat
ter how unpleasant the task, made so by
the suffering we have endured from lack of
like good faith towardus by other nations
The United States schooner Lizzie Major
was arrested on the high seas by Spanish
frigate, and two passengers taken from 1t
and carried as prisoners to Cuba. Repre-
sentations of these facts were made to the
Spanish Government as soon as official in
formation of them reached Washington.
The two passengers were set at liberty,
and the Spanish Government assured the
United States that the Captain of the fri
gate, in making the capture, had acted
without law-that he had been repri-
manded for the irregularity of his conduct,
and that the Spanish authorities in Cuba
would not sanction any act that would vio-
late the right, or treat with disrespect the
sovereignty of this nation.


The question of the seizure of the brig
Marv Lowell, at one of the Bahama Is