the earth, and to invoke the continuance of His favor. Knowing that none but a just and righteous cause can gain the Divine favor, we would implore the Lord of Hosts to guide and direct our policy in the paths of right, duty, justice, and mercy, to unite our hearts and our efforts for the defence of our dearest rights; to strengthen our weakness; crown our arms with suc cess, and enable us to secure a speedy, just, and honorable peace. To these ends, and in conformity with the request of Congress, I invite the people of the Confederate States to the observance of a day of fasting and prayer, by such religious services as may be suitable for the occasion, and I recommend Thursday, the 13th day of June next, for that purpose; and that we may all on that day, with one accord, join in humble and reverential approach to Him in whose hands we are, invoking Him to inspire us with a proper spirit and temper of heart and mind to bear our evils, to bless us with His favor and protection, and to bestow His gracious benedictions upon our Government and country. On the 12th of August, President Lincoln issued the following proclamation, appointing the last Thursday in September ensuing as a day of fasting: A PROCLAMATION. Whereas, A joint Committee of both Houses of Congress has waited on the President of the United States, and requested him to "recommend a day of public humiliation, prayer, and fasting, to be observed by the people of the United States with religious solemnities,, and the offering of fervent supplications to Almighty God for the safety and welfare of these States, His peace; blessings on their arms, and a speedy restoration of And whereas, It is fit and becoming in all people, at all times, to acknowledge and revere the Supreme Government of God; to bow in humble submission to his chastisements; to confess and deplore their sins and transgressions, in the full conviction that the fear of the Lord is the beginning of wisdom, and to pray, with all fervency and contrition, for the pardon of their past offences, and for a blessing upon their present and prospective action; And whereas, When our own beloved country, once, by the blessing of God, united, prosperous, and happy, is now afflicted with faction and civil war, it is peculiarly fit for ns to recognize the hand of God in this terrible visitation, and in sorrowful remembrance of our own faults and crimes as a nation, and as individ uals, to humble ourselves before Him, and to pray for His mercy-to pray that we may be spared further punishment, though most justly deserved; that our arms may be blessed and made effectual for the reestablishment of law, order, and peace, throughout the wide extent of our country; and that the inestimable boon of civil and religious liberty, earned under His guidance and blessing by the labors and sufferings of our fathers, may be restored in all its original excellence; Therefore, I, Abraham Lincoln, President of the United States, do appoint the last Thursday in September next as a day of humiliation, prayer, and fasting for all the people of the nation. And I do earnestly recommend to all the people, and especially to all ministers and teachers of religion, of all denominations, and to all heads of families, to observe and keep that day, according to their several creeds and modes of worship, in all humility, and with all religious solemnity, to the end that the united prayer of the Nation may ascend to the Throne of Grace, and bring down plentiful blessings upon our country. In testimony whereof, I have hereunto set my hand, and caused the seal of the United States to be [L. S.] affixed, this 12th day of August, A. D. 1861, and of the Independence of the United States of America the eighty-sixth. ABRAHAM LINCOLN. 1 15th of November as a fast day. The proclamation was as follows: A PROCLAMATION. Whereas, It hath pleased Almighty God, the Sovereign Disposer of events, to protect and defend the Confederate States hitherto, in their conflict with their enemies, and to be unto them a shield; and, whereas, with grateful thanks we recognize His hand and ac victory; and in humble dependence upon His Almighty knowledge that not unto us, but unto Him belongeth the strength, and trusting in the justness of our cause, we appeal to Him that He may set at naught the efforts of our enemies, and put them to confusion and shame; Now, therefore, I, Jefferson Davis, President of the Confederate States, in view of the impending conflict, do hereby set apart Friday, the 15th day of November, as a day of fasting, humiliation, and prayer; and I do hereby invite the reverend clergy and the people of these Confederate States to repair on that day to their usual places of public worship, and to implore the blessing of Almighty God upon our arms; that He may give us victory over our enemies, preserve our homes and altars from pollution, and secure to us the restoration of peace and prosperity. Given under my hand and the seal of the Confederate States, at Richmond, this 31st day of October, in the year of our Lord one thousand eight hundred and sixty-one. JEFFERSON DAVIS. FINANCES OF THE UNITED STATES. The finances of the Federal Government for the year 1861 underwent a very important and radical change, both in respect to the policy of raising revenue. The Constitution of the Feda national debt, and in relation to the mode of eral Government provides for raising revenue as well by direct taxes as by indirect duties upon consumable articles. It has been the case, however, that the former have been unpopular, while the latter have not only had the merit of being easily collected, but, while they have sufficed to meet all the ordinary wants of ceed them, as in 1836, when a surplus revenue the Government, and sometimes greatly to exof $28,000,000 was distributed among the States, they have served to give incidental protection to the nascent manufactures of the Union. The revenue derived from the sales of land was also a resource which did not bear directly upon the industry of the people. In times of unforeseen difficulty, like commercial revulsion or war, the Government has always been able to borrow sufficient to meet the exigency, and returning prosperity has always afforded the means of paying off the debt. During the war of 1812 an attempt at direct taxation was made without very satisfactory results, and the taxes were soon repealed. The aggregate resources and payments of the Federal Government, from its origin down to the close of the fiscal year 1861, were as follows: Customs revenue...................... .$1,575,152,579.92 Land 175,817,961.00 Taxes and other receipts.... 95,305,322.56 Total ordinary revenue, March 4, 1789, to July 1,1861, Total ordinary expenditure, March 4, 1789, to July 1,1861, Total excess revenue.... Total amount received for loans 1789 to 1861 Total amount paid for loans 1789 to 1861.......... On the 31st of October President Davis issued another proclamation, appointing the Excess payments for loans.... $462,935,644.64 781,886,375.00 $1,846,275,863.48 1,453,790,786.00 $392,485,077.48 $318,950,730.36 $10,000.. 30,000. 10,000 140,000. 67,000. 721,000. 265,000. 548,000. 1,267,000. $5,000,000 Average rate, 104 per cent. Thus by far the largest portion of all the expenses of the Government during its existence, including war expenses, purchase of territories, indemnities to Mexico, Texas, &c., was discharged by the customs revenues. If we deduct from the debt $90,867,828, that existed July 1, 1861, the amount of $28,101,644 deposited 1,947,000. among the States under the law of 1836 and never returned, and also the debt made necessary by the troubles in the latter part of the fiscal year 1861, there will remain very little, thus showing that all the expenses of the Federal Government from its origin have been paid by customs revenues, leaving in the hands of the Government an immense amount of property acquired in land, and still at its disposal, also vast military resources and public buildings, in the whole Union. The condition of the finances now seriously engaged the attention of Congress. The apparent discredit of the Government made some vigorous means necessary to replenish the treasury. The necessity of revising the tariff, so that it would produce a larger revenue, was obvious, and a bill to that effect was introduced. Meantime a bill was passed, February 8, authorizing a loan of $25,000,000, to bear 6 per cent. The magnitude of the civil war caused, interest, to run not less than ten nor more than however, a complete change in the finances, in- twenty years; the stock to be sold to the highvolving as it did an amount of expenditure est bidder. The Secretary offered $8,000,000 within the year, never before undertaken by of this stock. The bids were opened Feb. 27, any nation. The capital of the country seemed, and the whole amount offered was $14,355,000, however, equal to the exigency, although the ranging from 75 to 96 per cent. All bids below public mind was at first somewhat startled by 90 were refused, and the stock, as awarded, events. In June, 1860, Congress had author-ranged at 90 to 96 per cent. ized a loan of $20,000,000; of this, $10,000,000 was offered in the month of October in a 5 per cent. stock, which was taken at a small premium. Inasmuch, however, as the Presidential election of Nov. 6, 1860, intervened before the instalments were paid up, the resulting inquietude caused some of the bidders to decline the stock, and $7,022,000 only was issued. The same circumstances caused a great decline in the customs revenues, and the means of the Government in December were greatly cramped. The Secretary of the Treasury, Howell Cobb, resigned December 10. On the 14th of that month Congress passed a law, approved on the 17th, permitting the issue of $10,000,000 treasury notes, payable in a year, at the lowest rates of interest offered. The Secretary offered $5,000,000 of the notes, bids to be opened Dec. 28. When the time expired, however, but $500,000 had been bid, at 12 per cent. There were some offers at 24 per ct., and some as high as 36 per cent. The Secretary rejected all over 12 per cent. It was highly necessary that the money should be had to meet the interest on the Federal stocks due Jan. 1, and a number of banks and bankers offered for $1,500,000 at 12 per cent., on condition that the money should be applied to the interest. On the 31st the remainder was taken by the same association at the same rate. It may be here stated that the State of New York had offered for $1,200,000 in a 7 per cent. stock, 3 years to run, and it was taken at 101.12 to102.71, average 1014, on the 26th December. General Dix was appointed Secretary of the Treasury in January, and he offered the remaining $5,000,000 of the loan authorized. The bids were opened on the 19th, and the notes awarded as follows: The tariff bill reported by the Committee of Ways and Means under such circumstances had been passed with little debate. It restored the highest protective character to the tariff, replaced ad valorem duties with complicated specific duties, and gave but 30 days' notice before going into operation. It was passed March 2, to go into operation April 1, and it authorized a loan of $10,000,000. The immediate effect of the tariff was to produce larger entries at the custom-house, in order to avoid the new tax. The consequently improved customs revenue supported the Government credit, and this, with renewed hopes of continued peace, caused the Government stock to advance in the market. The new Secretary of the Treasury, S. P. Chase, offered $8,000,000 more of the stock, for which bids were opened April 2. It was found that for $3,000,000, 94 to 100 per cent. was offered, and 934, or 34 per cent. higher than the bids in February, for an amount equal to the balance of the loan. The department thought proper to reject all bids below 94, consequently only that part of the loan was placed, $3,099,000, average 94.01, netting $2,913,395. This decision was unfortunately made at the moment when the expedition was about to sail from New York to reenforce Fort Sumter, a fact not known to the public. When it became known, much uneasiness was created, and in the midst of it the department offered $5,000,000 of the balance of the loan in 6 per cent. treasury notes, payable in two years, and convertible into twenty-years stock. These bids were opened on the 11th April, when only $1,000,000 had been offered. Parties interested then procured a delay, in order that further effort in favor of the stock might be made. The price of money at call was then in the market 4 per cent., and could with difficulty be placed at that rate, and the United States 6 per cent. 20-years stock was selling at 83. Finally the bids amounted to $2,500,000, and the leading banks and bankers with great exertion made up the remainder, completing the $5,000,000 6 per cent. treasury notes at par. These being receivable for customs-duties, while money in the open market was only 4 per cent., large importers who had funds lying idle to meet duties, could invest them in these notes, where they would earn 6 per cent., and be available for the duties. The department was now comparatively easy for the moment, but the immense expenses rapidly absorbed means. Congress was not to meet until July 4, and the Government credit, as apparent from the price of its 6 per cent. stock being 84, when money was only worth 4 per cent., for the same description for which the Government a few years before had itself paid 22 per cent. premium, was shaken. The resources of the Treasury now consisted of $14,000,000, that had been authorized by the act of June, 1860, but which could not be sold under par for a 6 per cent. stock. There was the balance, $9,000,000, of the $25,000,000 authorized by the law of February, 1861, which might be sold to the best advantage, and there was also the $10,000,000, authorized by the tariff law of March 2, 1861; but this could not be used until after June 30, or the close of the fiscal year 1861. The difficulty was to raise means upon these stocks. The banks and capitalists began to feel the necessity of aiding the Government and sustaining its credit as a matter of self-defence. Under these circumstances the New York Chamber of Commerce, with various sub-committees, and the New York and Boston banks, took the matter in hand, and after much difficulty issued the following card, May 16: "The undersigned, a committee of the Chamber of Commerce, having, by a sub-committee, recently visited Washington to confer with the Secretary of the Treasury on the subject of the loans, which he is authorized by law to issue, they beg to call the attention of the public to the particulars of these loans, as follows: "1. A loan of about nine million dollars, which will be issued in bonds or stock having twenty years to run, and at six per cent. interest. For this proposals are invited, and it will be awarded to the highest bidder, at Washington, on Tuesday, the 21st inst. "2. A loan of fourteen million dollars, ($14,000,000,) which is limited by the law of June, 1860, at par. This loan is now advertised to be awarded on the 30th instant, but from its limitation it will probably have to be issued in treasury notes having two years to run, and convertible into twenty-years stock or bonds, as above, at the pleasure of the holder; which notes the Secretary is by law authorized to substitute, and which are also restricted to par. "And the committee invite all capitalists and moneyed institutions to avail of these opportunities for investment. "Committee.--Pelatiah Perit, Stewart Brown, William H. Aspinwall, J. J. Astor, jr., August Belmont, James Gallatin, A. T. Stewart, J. M. Morrison, Moses Taylor, George S. Coe, F. A. Palmer, John Q. Jones, D. R. Martin, Jacob Campbell, jr." When the time expired for the proposals, the bids were not completed, and Mr. Chase postponed the opening of the bids until May 25. The intermediate time was employed by influential parties in endeavoring to make up the loan. Finally, on opening the bids, the offers for the $9,000,000 reached 84 to 93 for the stocks, of which $6,396,000 were awarded at 85 to 93, a large portion to the New York banks, and $2,241,000 in 6 per cent. treasury notes at par. The proposals for the $14,000,000 were to be opened on the 30th of May. That, however, was only a formality, since no one would bid par for stocks that he could buy in the market at 84. The compliance with the law, however, enabled the Secretary to issue the amount in treasury notes. Some of these were taken, and the remainder was paid out gradually to creditors. While the Federal Government was thus struggling for money, the various States were also in the market with war loans. New York City procured $1,000,000 at the close of April; Pennsylvania sold $3,000,000 of a 5 per cent. loan, Ohio $1,000,000, Indiana offered $1,500,000 in a 6 per cent. stock, Illinois $1,000,000, Michigan, $500,000 at 7 per cent., Iowa $400000 at 7 per cent., Connecticut $2,000,000 at 6 per cent. The State of New York obtained $700,000 7 per cent. loan at 101.38 to 101.65, Maine $1,000,000 in a 5 per cent. stock at a premium. The Towards the close of June the Government wants were again attracting attention, and the banking interest was urging the adoption of the loan or stock system, rather than the treasury note plan which the Secretary seemed to favor. There were no measures adopted, however, until the meeting of Congress. Secretary then required $5,000,000 to carry him along until Congress should devise means. The two-years treasury notes that had been issued at par were at 24 per cent. discount, and were therefore not directly available. It was finally decided to borrow of the banks the required amount at 60 days on pledge of the 6 per cent. notes as collateral security. The amount of $5,000,000 was promptly made up on these terms. At the meeting of Congress, July 4, the Secretary of the Treasury, in his report, set forth the financial difficulties that beset the Government, and stated the probable expenditure for the year at $318,519,581.97. Civil list.. Interior department.. War Navy Public debt Total extra.. Ordinary expenses... Total for 1862 431,525.75 $831,496.90 realized, it will be necessary, in order to sustain 180,296,397.19 fully the public credit, to provide for raising 30,609,520.29 the sum of $20,000,000 for the current year, at 12,639,861.64 least, by direct taxes, or from internal duties $224,808,801.77 or excises, or from both." 93,710,780.30 With these provisions the Secretary had now $318,519,582.07 to come into the market to raise the money, This was the sum Congress was called upon and his prospect was not promising. The to meet. According to the Secretary $80,000,- law limited the sale of the stocks to a price 000 might be raised by import duties and tax- equal to par for a 7 per cent. stock, which was ation, and $240,000,000 by loans. Taxes on 89.32, and the 6 per cent. had been at 834 in coffee and tea were proposed, and higher rates June, and were at the passage of this act, Aug. upon most other articles of consumption. Con- 5, 864. The disaster at Bull Run had placed gress immediately took the matter into con- the whole country in peril. Washington was sideration, and, July 17, passed a law authoriz. in immediate danger of capture; Baltimore was ing a loan of $250,000,000 in form as follows: of doubtful loyalty, and several large States Stock, 7 per cent., redeemable after 20 years....$250,000,000 now held by the armies, were then ready to cast their influence into the preponderating scale. Congress had adjourned after binding the Secretary of the Treasury by law, to obtain money at a minimum rate, and there no resort left but the issue of paper money, based upon the faith and future resources of a country discouraged, distracted, and whose future was shrouded in gloom. It was under these circumstances that the Secretary visited New York, and after an interview with the bank officers, it was agreed that the banks of Boston, Philadel phia, and New York should take the 7 notes of $50 and upwards, three years to run, in the proportions as follows: 66 6 46 66 20 equal to par for 7 per cent... Stock, 7 per cent., redeemable after 20 years, payable in Europe Treasury notes, 7/10 per cent., redeemable at 3 years, convertible into 6 per cent. stock.. Treasury notes, 36/10 100, redeemable at 1 year, convertible into 3-years bonds.... Demand notes, issued as money, not less than $5, nor more than.... Treasury notes, 6 per cent., payable within 12 months 100,000,000 50,000,000 20,000,000 The whole amount of stock, treasury notes, and demand notes was not to exceed $250,000,000, except the 6 per cent. notes left, which were to be used as collaterals for temporary loans, and were meant to legalize what the Secretary had already negotiated in that shape. The permission to issue $100,000,000 in foreign stock was in the hope that a portion of it might be placed abroad. The act, as it passed the House, pledged the customs revenues for the payment of the interest, but the clause was subsequently stricken out. The law of July 17 limited the rate at which the 7 per cent. stock might be sold, to par; but a supplemental act of Aug. 5 allowed the sale of a 6 per cent. at a rate equal to par for a 7 per cent. stock. Having given this authority to borrow, Congress proceeded to pass such laws as might improve the revenues. A direct tax, an income tax, and higher duties, were imposed. The direct tax act provided for the levy of $20,000,000 upon all the States, which would give from the loyal States $12,000,000, from which the expenses of collection were to be deducted. The income tax provided for the payment of 3 per cent. on incomes over $800, to be levied in April, 1862, on the incomes of 1861. The increase of duties embraced taxes on cocoa, coffee, tea, sugar, which it was supposed would yield $22,500,000. The Secretary remarked "that the total revenue from imports during the present year may be $57,000,000, to which may be added the sum of $3,000,000, to be derived from the sales of the public lands and miscellaneous sources, making the total revenue for the year $60,000,000. While, therefore, there is every reason to believe that under a modified tariff, when the prosperity of the country shall be fully restored, an annual revenue of not less than $80,000,000, and probably more, may be was This was a supply of $150,000,000 for three months, in addition to which the Secretary had the right to issue $50,000,000 of paper money; but to the exercise of this power the banks strongly objected, since the notes being made redeemable in coin in New York, and paid out in the interim, might cause a drain of specie from New York, which the department would be compelled to meet under the law, by drawing the coin from the banks, thus jeopardizing their solvency. The Secretary, therefore, used them very sparingly. It was also agreed that the Secretary should make an appeal to the pub lic for the sale of the 7 per cent, notes, and that he should appoint agents for the sale in all prominent places; but that all sales so made should be supplied from those taken by the banks, until the amount should be exhaust ed. The Secretary made an address to the people in accordance with this understanding, and some 500 agents were appointed. The appeal was, however, without the anticipated success. The public responded but to a comparatively small extent. The Secretary continued to draw upon the credit in his favor opened by the banks, which thus found their means passing from them, without much prospect of getting them back, since the notes they had taken would no longer sell at par in the open market. Hence, as the 1st December approached, they decided to take $50,000,000 in the 6 per cent. 20years stock at a rate equal to par for the 7 per ct. This was 89.322, or in amount $44,661,231 91 for the fifty millions, to which was added the interest from July, making $45,795,478. Congress was now again in session. The report of the Secretary, that had been looked for with the greatest interest, was at last made, and it contained the following statement of the money that had been raised since the adjournment of Congress in August: There were paid to creditors, or exchanged for coin at par, at different dates in July and August, six per cent. two-years notes, to the amount of There was borrowed, at par, in the same months, upon sixty-days six per cent. notes, the sum of .. There was borrowed, at par, on the 19th of There was borrowed, on the 1st of October, Making an aggregate, realized from loans in .......... $14,019,034.66 While thus successful in borrowing, the revenues had been far less than the estimates, and the expenses far greater the former, by reason of the stagnation of trade, and the latter in consequence of the great increase in the army. The Secretary, therefore, revised his estimates for the year as seen in the following table: The Secretary advised a resort to taxation as a means of raising $50,000,000 in excess of the customs for the service of the year 1863, in which year he estimated the expenses at $475,334,245. This result was very unsatisfactory, and the public credit did not revive on the exposition, and the year closed with the suspension of the banks, amid gloomy prospects. On emitting the demand notes, the Secretary of the Treasury addressed a circular to the various Assistant Treasurers, to the following effect: Under the acts of July 19th and August 5th last, Treasury notes of the denomination of $5, $10, and 820, have been, and will continue to be issued, redeemable in coin on demand at the offices of the Assistant Treasurer at Boston, New York, Philadelphia, St. Louis, and at the Depository of Cincinnati. These notes are intended to furnish a current medium of payment, exchange, and remittance, being at all times convertible into coin at the option of the holder, at the place where made payable, and everywhere receivable for public dues. They must be always equivalent to gold, and often and for many purposes more convenient 50,000,000.00 and valuable. 50,000,000.00 12,877,750.00 45,795,478.48 24,550,325.00 $197,242,588.14 It will be observed that in the whole of this borrowing very little was really subscribed by capitalists for investment. About $38,000,000 of the 3-years notes only had been taken, mostly by small investors, and they were already again offering them in the market to an extent which reduced the price to 96 for those that were endorsed, and 98 for clean notes. The banks had invested the idle capital accumulated in their vaults, belonging to depositors, and the securities were still hanging over the market in prospective competition with the future loans of the Government. The department, nevertheless, had obtained the money. A sufficient amount of coin to redeem these notes promptly on demand will be kept with the depositaries, by whom they are respectively made payable. And all depositors and collecting officers will receive them, enter them on their books, and pay them to public creditors as money. Large amounts of the notes of small denominations are rapidly being issued and distributed. General Scott issued the following order: HEAD-QUARTERS OF THE ARMY, WASHINGTON, Sept. 3, 1861. The General-in-Chief is happy to announce that the Treasury Department, to meet future payments to the troops, is about to supply, besides coin, as heretofore, Treasury notes in fives, tens, and twenties-as good as gold at all banks and Government offices throughout the United States, and most convenient for transmission by mail from the officers and men to their families at home. Good husbands, fathers, sons, and brothers, serving under the Stars and Stripes, will thus soon have the ready and safe means of relieving reached with coin. In making up such packages, an immense amount of suffering, which could not be every officer may be relied upon, no doubt, for such assistance as may be needed by his men. By command of Lieutenant-General SCOTT. E. D. TOWNSEND, Assistant Adjutant-General. Of these, the Secretary had issued about ESTIMATES OF REVENUE AND EXPENDITURE FOR THE YEAR 1862. |