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and the future settlement of the existing disagreements be rendered more difficult.

While on the point of war with Austria, the Government dissolved the Chamber of Deputies, and ordered an election of primary electors to be held on June 25th, and the final election of deputies on July 3d. The election took place under the influence of the great victories gained by the Prussian army, and resulted in largely adding to the number of the Conservative party. A semi-official paper of Berlin classed the new chamber as follows: Conservatives, 143; Old Liberals, 26; Catholic party, 16; Left Centre, 65; Progress party, 71; Polish party, 21; uncertain, 4; 3 not yet known. The Chambers were opened by the king in person on the 4th of August by a speech which refers, in the following manner, to the relations of the Government with the Chambers and to the reconstruction of Germany.

My Government is able to look with satisfaction upon the financial position of the State. Careful foresight and conscientious economy have placed it in a position to overcome the great financial difficulties which have resulted, as a natural consequence, from the circumstances of the present time. Al though material outlay has been imposed upon the treasury during recent years by the war with Denmark, it has been found possible to meet the expenses hitherto incurred in the present war from the State revenue and the existing balances, without imposing any other burden upon the country than that of furnishing supplies for the purposes it is bound to provide by law. I hope the more assuredly that the means required for the successful termination of the war and for the payment of the supplies in kind, while maintaining order and security in the finances, will be readily granted by you. An agreement with the representatives of the country as to the settlement of the budget has not been able to be effected in the last few years. The State outlay during this period is therefore destitute of that legal basis which, as I again acknowledge, the budget can alone receive through the law. Article 99 of the constitution ordains it annually to be agreed upon between my Government and the two Houses of the Diet, although my Government has nevertheless carried on the budget for several years without this legal basis. This has only been done after conscientious examination, and in the conviction, in accordance with duty, that the conduct of a settled administration, the fulfilment of legal obligations toward public creditors and officials, the maintenance of the army and the State establishments, were questions vital to the existence of the State, and that the course adopted therefore became one of those inevitable necessities which in the interest of the country a Government cannot and must not hesitate to adopt. I trust that recent events will in so far contribute to effect the indispensable undertaking that an indemnity for having carried on the budget, application for which will be made to the representatives, will readily be granted to my Government, and the hitherto existing conflict be finally and the more seemly brought to a conclusion, as it may be expected that the political position of the fatherland will admit an extension of the frontiers of the State, and the establishment of an united Federal army under the leadership of Prussia, the cost of which will be borne in equal proportions by all members of the Confederation. The bills required in this respect for the convocation of a popu lar representation of the Federal States will be laid before the said Diet without delay.

Herr von Forckenbeck was elected president, obtaining 170 votes against 136 given to the

Conservative and 22 to the Old Liberal candidates. The immense majority of the Chamber of Deputies approved the foreign policy of the Government, and showed a desire to come to an understanding on home questions, by mak ing concessions. Thus an address, in reply to the speech from the throne, was agreed upon by both the Conservatives and Liberals, and was adopted by all, save 25 votes (four members of the Left, and the Polish and Catholic Deputies). The king, on receiving the address, assured the deputies of the Chamber that the Government had never disputed the rights of the Chamber with regard to the budget. The indemnity which was now asked had, in principle, been repeatedly proposed by the Govern ment, but unfortunately on former occasions no agreement had ensued. The constitution contained no article applicable to such a posi tion of affairs. In the event of a recurrence of a similar state of things, he would be under the necessity of again acting as he had acted before in order to preserve the regular order in the State. But a renewal of the conflict could not take place after the adoption of such an address as that just presented to him.

The Chamber adopted a bill of indemnity for the financial administration of the Government from the commencement of the year 1862 to the present time; bills for the annexation of Hanover, Hesse-Cassel, Nassau, Frankfort, and Schleswig-Holstein; a bill for expressing the gratitude of the country to Count Bismarck, and Generals von Moltke, the Minister of War (Von Roon), Herwarth von Bittenfield, Von Steinmetz, and Vogel von Falckenstein, by a donation of 1,000,000 thalers.

In consequence of the German-Italian war, Prussia not only received a large increase of territory and population, but also became the head of the North German Confederation, comprising all the German States north of the river Main. (See GERMANY.) On the map which accompanies this article, Prussia proper (as it was at the beginning of the year 1866) is marked in black; the States annexed in 1866 are marked by small horizontal lines; the States forming with Prussia the North German Confederation are indicated by a dotted surface. The conventions concluded by Prussia with the minor States for the purpose of establishing this confederation, give to Prussia the chief command of the whole federal army, and the sole right of diplomatic representation abroad. The annexed States and the minor States of the North German Confederation will increase the Prussian army in time of peace to about 300,000, and in time of war to 1,000,000. As in case of war, also the armies of Bavaria, Würtemberg. Baden, and Hesse-Darmstadt, will be under command of the king of Prussia; the Prussian army, on a war footing, will consist of upward of 1,300,000. In December plenipotentiaries from all the States met at Berlin, in order to prepare a draft of the Federal Constitution, to be revised by the first Federal Parliament.

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PUBLIC DOCUMENTS. Message of the President of the United States to the two Houses at the commencement of the second session of the Thirty-ninth Congress, December 3, 1866. Fellow-Citizens of the Senate and

House of Representatives: After a brief interval the Congress of the United States resumes its annual legislative labors. An allwise and merciful Providence has abated the pestilence which visited our shores, leaving its calamitous traces upon some portions of our country. Peace, order, tranquillity, and civil authority have been formally declared to exist throughout the whole of the United States. In all the States civil authority has superseded the coercion af arms, and the people, by their voluntary action, are maintaining their governments in full activity and complete operation. The enforcement of the laws is no longer "obstructed in any State by combinations too powerful to be suppressed by the ordinary course of judicial proceedings;" and the animosities engendered by the war are rapidly yielding to the beneficent influences of our free institutions, and to the kindly effects of unrestricted social and commercial intercourse. An entire restoration of fraternal feeling must be the earnest wish of every patriotic heart; and we will accomplish our grandest national achievement when, forgetting the sad events of the past, and remembering only their instructive lessons, we resume our onward career as a free, prosperous, and united people.

In my message of the 4th of December, 1865, Congress was informed of the measures which had been instituted by the Executive with a view to the gradual restoration of the States in which the insurrection occurred to their relations with the General Government. Provisional Governors had been appointed, conventions called, Governors elected, Legislatures assembled, and Senators and Representatives chosen to the Congress of the United States. Courts had been opened for the enforcement of laws long in abeyance. The blockade had been removed, custom-houses reestablished, and the internal revenue laws put in force, in order that the people might contribute to the national income. Postal operations had been renewed, and efforts were being made to restore them to their former condition of efficiency. The States themselves had been asked to take part in the high function of amending the Constitution, and of thus sanctioning the extinction of African slavery as one of the legitimate results of our internecine struggle.

Having progressed thus far, the Executive Depart ment found that it had accomplished nearly all that was within the scope of its constitutional authority. One thing, however, yet remained to be done before the work of restoration could be completed, and that was the admission to Congress of loyal Senators and Representatives from the States whose people had rebelled against the lawful authority of the General Government. This question devolved upon the respective Houses, which, by the Constitution, are made the judges of the elections, returns, and qualifications of their own members; and its consideration at once engaged the attention of Congress.

In the mean time, the Executive Department-no other plan having been proposed by Congress-continued its efforts to perfect, as far as was practicable, the restoration of the proper relations between the citizens of the respective States, the States, and the Federal Government, extending, from time to time, as the public interests seemed to require, the judicial, revenue, and postal systems of the country. With the advice and consent of the Senate, the necessary officers were appointed, and appropriations made by Congress for the payment of their salaries. The proposition to amend the Federal Constitution, so as to prevent the existence of slavery within the

United States or any place subject to their jurisdic tion, was ratified by the requisite number of States; and on the 18th day of December, 1865, it was officially declared to have become valid as a part of the Constitution of the United States. All of the States in which the insurrection had existed promptly amended their constitutions, so as to make them conform to the great change thus effected in the organic law of the land; declared null and void all ordinances and laws of secession; repudiated all pretended debts and obligations created for the revolu tionary purposes of the insurrection; and proceeded, in good faith, to the enactment of measures for the protection and amelioration of the condition of the colored race. Congress, however, yet hesitated to admit any of these States to representation; and it was not until toward the close of the eighth month of the session that an exception was made in favor of Tennessee, by the admission of her Senators and Representatives.

f deem it a subject of profound regret that Congress has thus far failed to admit to seats loyal Senators and Representatives from the other States, whose inhabitants, with those of Tennessee, had engaged in the rebellion. Ten States-more than onefourth of the whole number-remain without representation; the seats of fifty members in the House of Representatives and of twenty members in the Senate are yet vacant-not by their own consent, not by a failure of election, but by the refusal of Congress to accept their credentials. Their admission, it is believed, would have accomplished much toward the renewal and strengthening of our relations as one people, and removed serious cause for discontent on the part of the inhabitants of those States. It would have accorded with the great principle enunciated in the Declaration of American Independence, that no people ought to bear the burden of taxation, and yet be denied the right of repre sentation. It would have been in consonance with the express provisions of the Constitution, that "each State shall have at least one Representative," and "that no State, without its consent, shall be deprived of its equal suffrage in the Senate." These provisions were intended to secure to every State, and to the people of every State, the right of representation in each House of Congress; and so important was it deemed by the framers of the Constitution that the cquality of the States in the Senate should be preserved, that not even by an amendment of the Constitution can any State, without its consent, be denied a voice in that branch of the National Legislature.

It is true, it has been assumed that the existence of the States was terminated by the rebellious acts of their inhabitants, and that the insurrection baring been suppressed, they were thenceforward to be considered merely as conquered territories. The Legislative, Executive, and Judicial Departments of the Government have, however, with great distinctness and uniform consistency, refused to sanetion an assumption so incompatible with the nature of our republican system, and with the professed objects of the war. Throughout the recent legis lation of Congress the undeniable fact makes itself apparent, that these ten political communities are nothing less than States of this Union. At the very commencement of the rebellion each House declared, with a unanimity as remarkable as it was significant, that the war was not "waged, on our part, in any spirit of oppression, nor for any purpose of conquest or subjugation, nor purpose of overthrowing or isterfering with the rights or established institutions of those States, but to defend and maintain the sapremacy of the Constitution and all laws made in pursuance thereof, and to preserve the Union with all the dignity, equality, and rights of the several States unimpaired; and that as soon as these of jects" were "accomplished, the war ought to cease." In some instances, Senators were permitted to cos

tinue their legislative functions, while in other instances Representatives were elected and admitted to seats after their States had formally declared their right to withdraw from the Union, and were endeav oring to maintain that right by force. All of the States whose people were in insurrection as States were included in the apportionment of the direct tax of twenty millions of dollars annually laid upon the United States by the act approved August 5, 1861. Congress, by the act of March 4, 1862, and by the apportionment of representation thereunder, also recognized their presence as States in the Union; and they have, for judicial purposes, been divided into districts, as States alone can be divided. The same recognition appears in the recent legislation in reference to Tennessee, which evidently rests upon the fact that the functions of the State were not destroyed by the rebellion, but merely suspended; and that principle is of course applicable to those States which, like Tennessee, attempted to renounce their places in the Union.

The action of the Executive Department of the Government upon this subject has been equally definite and uniform, and the purpose of the war was specifically stated in the proclamation issued by my predecessor on the 22d day of September, 1862. It was then solemnly proclaimed and declared that "hereafter, as heretofore, the war will be prosecuted for the object of practically restoring the constitutional relation between the United States and each of the States and the people thereof, in which States that relation is or may be suspended or disturbed." The recognition of the States by the Judicial Department of the Government has also been clear and conclusive in all proceedings affecting them as States, had in the Supreme, Circuit, and District Courts.

In the admission of Senators and Representatives from any and all of the States, there can be no just ground of apprehension that persons who are disloyal will be clothed with the powers of legislation: for this could not happen when the Constitution and the laws are enforced by a vigilant and faithful Congress. Each House is made the "judge of the elections, returns, and qualifications of its own members," and may, "with the concurrence of twothirds, expel a member." When a Senator or Rep. resentative presents his certificate of election, he may at once be admitted or rejected; or, should there be any question as to his eligibility, his credentials may be referred for investigation to the appropriate committee. If admitted to a seat, it must be upon evidence satisfactory to the House of which he thus becomes a member, that he possesses the requisite constitutional and legal qualifications. If refused admission as a member for want of due allegiance to the Government, and returned to his constituents, they are admonished that none but persons loyal to the United States will be allowed a voice in the legislative councils of the nation, and the political power and moral influence of Congress are thus effectively exerted in the interests of loyalty to the Government and fidelity to the Union. Upon this question, so vitally affecting the restoration of the Union and the permanency of our present form of government, my convictions, heretofore expressed, have undergone no change; but, on the contrary, their correctness has been confirmed by reflection and time. If the admission of loyal members to seats in the respective Houses of Congress was wise and expedient a year ago, it is no less wise and expedient now. If this anomalous condition is right now-if, in the exact condition of these States at the present time, it is lawful to exclude them from representation, I do not see that the question will be changed by the efflux of time. Ten years hence, if these States remain as they are, the right of representation will be no stronger-the right of exclusion will be no weaker.

The Constitution of the United States makes it

the duty of the President to recommend to the consideration of Congress such measures as he shall judge necessary or expedient." I know of no measure more imperatively demanded by every consideration of national interest, sound policy, and equal justice, than the admission of loyal members from the now unrepresented States. This would consummate the work of restoration, and exert a most salutary influence in the reestablishment of peace, harmony, and fraternal feeling. It would tend greatly to renew the confidence of the American people in the vigor and stability of their institutions. It would bind us more closely together as a nation, and enable us to show to the world the inherent and recuperative power of a Government founded upon the will of the people, and established upon the principle of liberty, justice, and intelligence. Our increased strength and enhanced prosperity would irrefragably demonstrate the fallacy of the arguments against free institutions drawn from our recent national disorders by the enemies of republican government. The admission of loyal members from the States now excluded from Congress, by allaying doubt and apprehension, would turn capital, now awaiting an opportunity for investment, into the channels of trade and industry. It would alleviate the present troubled condition of those States, and, by inducing immigration, aid in the settlement of fertile regions now uncultivated, and lead to an increased production of those staples which have added so greatly to the wealth of the nation and the commerce of the world. New fields of enterprise would be opened to our progressive people, and soon the devastations of war would be repaired, and all traces of our domestic differences effaced from the minds of our countrymen.

In our efforts to preserve "the unity of government which constitutes us one people," by restoring the States to the condition which they held prior to the rebellion, we should be cautious, lest, having rescued our nation from perils of threatened disintegration, we resort to consolidation, and in the end absolute despotism, as a remedy for the recurrence of similar troubles. The war having terminated, and with it all occasion for the exercise of powers of doubtful constitutionality, we should hasten to bring legislation within the boundaries prescribed by the Constitution, and to return to the ancient landmarks established by our fathers for the guidance of succeeding generations. "The Constitution which at any time exists, until changed by an explicit and authentic act of the whole people, is sacredly oblig. atory upon all." "If, in the opinion of the people, the distribution or modification of the constitutional powers be, in any particular, wrong, let it be corrected by an amendment in the way in which the Constitution designates, but let there be no change by usurpation; for" "it is the customary weapon by which free governments are destroyed." Washington spoke these words to his countrymen, when, followed by their love and gratitude, he voluntarily retired from the cares of public life. "To keep in all things within the pale of our constitutional powcrs, and cherish the Federal Union as the only rock of safety," were prescribed by Jefferson as rules of action to endear to his "countrymen the true principles of their Constitution, and promote a Union of sentiment and action equally auspicious to their happiness and safety." Jackson held that the action of the General Government should always be strictly confined to the sphere of its appropriate duties, and justly and forcibly urged that our Government is not to be maintained nor our Union preserved “by invasions of the rights and powers of the several States. In thus attempting to make our General Government strong we make it weak. Its true strength consists in leaving individuals and States as much as possible to themselves; in making itself felt, not in its power, but in its beneficence; not in its control, but in its protection; not in binding the

States more closely to the centre, but leaving each to move unobstructed in its proper constitutional orbit." These are the teachings of men whose deeds and services have made them illustrious, and who, long since withdrawn from the scenes of life, have left to their country the rich legacy of their example, their wisdom, and their patriotism. Drawing fresh inspiration from their lessons, let us emulate them in love of country and respect for the Constitution and the laws.

The report of the Secretary of the Treasury affords much information respecting the revenue and commerce of the country. His views upon the currency, and with reference to a proper adjustment of our revenue system, internal as well as impost, are commended to the careful consideration of Congress. In my last Annual Message I expressed my general views upon these subjects. I need now only call attention to the necessity of carrying into every department of the Government a system of rigid accountability, thorough retrenchment, and wise economy. With no exceptional nor unusual expenditures, the oppressive burdens of taxation can be lessened by such a modification of our revenue laws as will be consistent with the public faith, and the legitimate and necessary wants of the Government.

The report presents a much more satisfactory condition of our finances than one year ago the most sanguine could have anticipated. During the fiscal year ending the 30th June, 1865, the last year of the war, the public debt was increased $941,902,587, and on the 31st of October, 1865, it amounted to $2,740,854,750. On the 31st day of October, 1866, it had been reduced to $2,551,310,066, the diminution, during a period of fourteen months, commencing September 1, 1865, and ending October 31, 1866, having been $206,379,565. In the last annual report on the state of the finances, it was estimated that during the three-quarters of the fiscal year ending the 30th June last, the debt would be increased $112,194,947. During that period, however, it was reduced $81,196,387, the receipts of the year having been $89,905,905 more, and the expenditures $200,529,235 less than the estimates. Nothing could more clearly indicate than these statements the extent and availability of the national resources, and the rapidity and safety with which, under our form of government, great military and naval establishments can be disbanded, and expenses reduced from a war to a peace footing.

During the fiscal year ending the 30th of June, 1866, the receipts were $558,032,620, and the expenditures $520,750,940, leaving an available surplus of $37,281,680. It is estimated that the receipts for the fiscal year ending the 30th June, 1867, will be $475,061,386, and that the expenditures will reach the sum of $316,428,078, leaving in the Treasury a surplus of $158,633,308. For the fiscal year ending June 30, 1868, it is estimated that the receipts will amount to $436,000,000, and that the expenditures will be $350,247,641-showing an excess of $85,752,359 in favor of the Government. These estimated receipts may be diminished by a reduction of excise and import duties; but after all necessary reductions shall have been made, the revenue of the present and of following years will doubtless be sufficient to cover all legitimate charges upon the Treasury, and leave a large annual surplus to be applied to the payment of the principal of the debt. There seems now to be no good reason why taxes may not be reduced as the country advances in population and wealth, and yet the debt be extinguished within the next quarter of a century.

The report of the Secretary of War furnishes valuable and important information in reference to the operations of his Department during the past year. Few volunteers now remain in the service, and they are being discharged as rapidly as they can be replaced by regular troops. The army has been promptly paid, carefully provided with medical

treatment, well sheltered and subsisted, and is to be furnished with breech-loading small-arms. The mili tary strength of the nation has been unimpaired by the discharge of volunteers, the disposition of unserviceable or perishable stores, and the retrenchment of expenditure. Sufficient war material to meet any emergency has been retained, and, from the disbanded volunteers standing ready to respond to the national call, large armies can be rapidly or ganized, equipped, and concentrated. Fortifications on the coast and frontier have received, or are being prepared for more powerful armaments; lake surveys and harbor and river improvements are in course of energetic prosecution. Preparations have been made for the payment of the additional bounties authorized during the recent session of Congress, under such regulations as will protect the Government from fraud, and secure to the honorably-discharged soldier the well-earned reward of his faithfulness and gallantry. More than six thousand maimed soldiers have received artificial limbs or other surgical apparatus; and forty-one national cemeteries, containing the remains of 104,526 Union soldiers, have already been established. The total estimate of military appropriations is $25,205,669.

It is stated in the report of the Secretary of the Navy that the naval force at this time consists of two hundred and seventy-eight vessels, armed with two thousand three hundred and fifty-one guns. Of these, one hundred and fifteen vessels, carrying one thousand and twenty-nine guns, are in commission, distributed chiefly among seven squadrons. The number of men in the service is thirteen thousand six hundred. Great activity and vigilance have been displayed by all the squadrons, and their movements have been judiciously and efficiently arranged in such manner as would best promote American commerce, and protect the rights and interests of our countrymen abroad. The vessels unemployed are undergoing repairs, or are laid up until their ser vices may be required. Most of the iron-clad fleet is at League Island, in the vicinity of Philadelphia, a place which, until decisive action should be taken by Congress, was selected by the Secretary of the Navy as the most eligible location for that class of vessels. It is important that a suitable public station should be provided for the iron-clad fleet. It is intended that these vessels shall be in proper condition for any emergency, and it is desirable that the bill accepting League Island for naval purposes, which passed the House of Representatives at its last session, should receive final action at an early period, in order that there may be a suitable public station for this class of vessels, as well as a navy. yard of area sufficient for the wants of the service, on the Delaware River. The naval pension fund amounts to $11,750,000, having been increased $2,750,000 during the year. The expenditures of the Department for the fiscal year ending 30th June last were $43,324,526, and the estimates for the coming year amount to $23,568,436. Attention is invited to the condition of our seamen, and the importance of legislative measures for their relief and improvement. The suggestions in behalf of this deserving class of our fellow-citizens are earnestly recommended to the favorable attention of Congress.

The report of the Postmaster-General presents a most satisfactory condition of the postal service, and submits recommendations which deserve the consideration of Congress. The revenues of the Department for the year ending June 30, 1866, were $14,386,986, and the expenditures $15,852,079, showing an excess of the latter of $965,093. In anticipation of this deficiency, however, a special appropriation was made by Congress in the act approved July 28, 1866. Including the standing appropriation of $700,000 for free mail matter, as a legitimate portion of the revenues yet remaining unexpended, the actual deficiency for the past year is only $265,093a sum within $51,141 of the amount estimated in the

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