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Claims against China.
valuable permanent improvement, worth its cost in all the future,
"Some treaties, designed chiefly for the interests of commerce, and having no grave political importance, have been negotiated, and will be submitted to the Senate for their consideration.
“Although we have failed to induce some of the commercial powers to adopt a desirable amelioration of the rigor of maritime war, we have removed all obstructions from the way of this humane reform, except such as are merely of temporary and accidental occurrence.
“I invite your attention to the correspondence between Her Britannic Majesty's Minister, accredited to this Government, and the Secretary of State, relative to the detention of the British ship Perthshire, in June last, by the United States steamer Massachusetts, for a supposed breach of the blockade. As this detention was occasioned by an obvious misapprehension of the facts, and as justice requires that we should commit no belligerent act not founded in strict right, as sanctioned by public law, I recommend that an appropriation be made to satisfy the reasonable demand of the owners of the vessel for her detention.
“I repeat the recommendation of my predecessor, in his annual message to Congress in December last, in regard to the disposition of the surplus which will probably remain after satisfying the claims of the American citizens against China, pursuant to the awards of the commissioners under be act of the 3d of March, 1859. If, however, it should not be deemed advisable to carry that recommendation into effect, I would suggest that authority be given for investing the principal, over the proceeds of the surplus referred to, in good securities, with a view to the satisfaction of such other just claims of our citizens against China as are not unlikely to arise hereafter in the course of our extensive trade with that empire.
Hayti and Liberia.
"By the act of the 5th of August last, Congress authorized the President to instruct the commanders of suitable vessels to defend themselves against and to capture pirates. This authority has been exercised in a single instance only. For the more effectual protection of our extensive and valuable commerce, in the Eastern seas especially, it seems to me that it would also be advisable to authorize the commanders of sailing vessels to recapture any prizes which pirates may make of United States vessels and their cargoes, and the consular courts, now established by law in Eastern countries, to adjudicate the cases, in the event that thisshould not be objected to by the local authorities.
"If any good reason exists why we should persevere longer in withholding our recognition of the independence and sovereignty of Hayti and Liberia, I am unable to discern it. Unwilling, however, to inaugurate a novel policy in regard to them without the approbation of Congress, I submit for your consideration the expediency of an appropriation for maintaining a charge d'affaires near each of those new States. It does not admit of doubt that important commercial advantages might be secured by favorable treaties with them.
“The operations of the treasury during the period which has elapsed since your adjournment, have been conducted with signal success. The patriotism of the people has placed at the disposal of the Government the large means demanded by the public exigencies. Much of the national loan has been taken by citizens of the industrial classes, whose confidence in their country's faith, and zeal for their country's deliverance from present peril, have induced them to contribute to the support of the Government the whole of their limited acquisitions. This fact imposes peculiar obliga- ' tions to economy in disbursement, and energy in action.
“The revenue from all sources, including loans, for the financial year ending on the 30th of June, 1861, was eightysix million eight hundred and thirty-five thousand nine
Report of Secretary of War.
bundred dollars and twenty-seven cents, and the expenditures for the same period, including payments on account of the public debt, were eighty-four million five hundred and seventy-eight thousand eight bundred and thirty-four dollars and forty-seven cents; leaving a balance in the treasury on the 1st of July of two million two hundred and fifty-seven thousand sixty-five dollars and eighty cents. For the first quarter of the financial year, ending on the 30th of September, 1861, the receipts from all sources, including the balance of the 1st of July, were one hundred and two million five hundred and thirty-two thousand five hundred and nine dollars and twenty-seven cents, and the expenses ninetyeight million two hundred and thirty-nine thousand seven bundred and thirty-three dollars and nine cents; leaving a balance on the 1st of October, 1861, of four million two hun. dred and ninety-two thousand seven hundred and seventysix dollars and eighteen cents.
“Estimates for the remaining three-quarters of the year, and for the financial year 1863, together with his views of ways and means for meeting the demands contemplated by them, will be submitted to Congress by the Secretary of the Treasury. It is gratifying to know that the expenditures made necessary by the rebellion are not beyond the resources of the loyal people, and to believe that the same patriotism which has thus far sustained the Government will continue to sustain it till peace and Union shall again bless the land.
“I respectfully refer to the report of the Secretary of War for information respecting the numerical strength of the Army, and for recommendations having in view an increase of its efficiency and the well-being of the various branches of the service intrusted to his care. It is gratifying to know that the patriotism of the people has proved equal to the occasion, and that the number of troops tendered greatly exceeds the force which Congress authorized me to call into the field.
Report of Secretary of the Navy.
"I refer with pleasure to those portions of bis report which make allusion to the creditable degree of discipline already attained by our troops, and to the excellent sanitary condition of the entire army.
“The recommendation of the Secretary for an organization of the militia upon a uniform basis is a subject of vital importance to the future safety of the country, and is commended to the serious attention of Congress.
" The large addition to the regular army, in connection with the defection that has so considerably diminished the number of its officers, gives peculiar importance to bis recommendation for increasing the corps of cadets to the greatest capacity of the Military Academy.
"By mere omission, I presume, Congress has failed to proride chaplains for hospitals occupied by volunteers. This subject was brought to my notice, and I was induced to draw up the form of a letter, one copy of which, properly addressed, has been delivered to each of the persons, and at the dates respectively named and stated, in a schedule, containing also the form of the letter, marked A, and herewith transmitted.
“These gentlemen, I understand, entered upon the duties designated, at the times respectively stated in the schedule. and have labored faithfully therein ever since. I therefore recommend that they be compensated at the same rate as Chaplains in the army. I further suggest that general proVision be made for chaplains to serve at hospitals, as well as with regiments.
“The report of the Secretary of the Navy presents in detail the operations of that branch of the service, the activity and energy which have characterized its administration, and the results of measures to increase its efficiency and power. Such bave been the additions, by construction and purchase, that it may almost be said a navy bas been created and brought into service since our difficulties commenced.
“Besides blockading our extensive coast, squadrons larger
than ever before assembled under our flag have been put afloat, and performed deeds which have increased our naval renown.
“I would invite special attention to the recommendation f the Secretary for a more perfect organization of the Navy by introducing additional grades in the service.
“ The present organization is defective and unsatisfactory, and the suggestions submitted by the Department will, it is believed, if adopted, obviate the difficulties alluded to, promote harmony, and increase the efficiency of the Navy.
“There are three vacancies on the bench of the Supreme Court-two by the decease of Justices Daniel and McLean, and one by the resignation of Justice Campbell. I have so far forborne making nominations to fill these vacancies for reasons which I will now state. Two of the outgoing judges resided within the States now overrun by revolt; so that if successors were appointed in the same localities, they could not now serve upon their circuits; and many of the most competent men there probably would not take the personal bazard of accepting to serve, even here, upon the Supreme Bench. I have been unwilling to throw all the appointments northward, thus disabling myself from doing justice to the South on the return of peace; although I may remark that to transfer to the North one which has heretofore been in the South would not, with reference to territory and population, be unjust.
“During the long and brilliant judicial career of Judge McLean, his circuit grew into an empire-altogether too large for any one judge to give the courts therein more than a nominal attendance-rising in population from one million four hundred and seventy thousand and eighteen, in 1830, to six million one hundred and fifty-one thousand four hundred and five, in 1860.
“Besides this, the country generally bas outgrown our present judicial system. If uniformity was at all intended,