Fellow-Citizens of the Senate and House of Representatives:

In communicating to you a just view of public affairs at the commencement
of your present labors, I do it with great satisfaction, because, taking
all circumstances into consideration which claim attention, I see much
cause to rejoice in the felicity of our situation. In making this remark I
do not wish to be understood to imply that an unvaried prosperity is to be
seen in every interest of this great community. In the progress of a nation
inhabiting a territory of such vast extent and great variety of climate,
every portion of which is engaged in foreign commerce and liable to be
affected in some degree by the changes which occur in the condition and
regulations of foreign countries, it would be strange if the produce of our
soil and the industry and enterprise of our fellow citizens received at all
times and in every quarter an uniform and equal encouragement. This would
be more than we would have a right to expect under circumstances the most
favorable.

Pressures on certain interests, it is admitted, have been felt; but
allowing to these their greatest extent, they detract but little from the
force of the remarks already made. In forming a just estimate of our
present situation it is proper to look at the whole in the outline as well
as in the detail. A free, virtuous, and enlightened people know well the
great principles and causes on which their happiness depends, and even
those who suffer most occasionally in their transitory concerns find great
relief under their sufferings from the blessings which they otherwise enjoy
and in the consoling and animating hope which they administer.

From whence do these pressures come? Not from a Government which is founded
by, administered for, and supported by the people. We trace them to the
peculiar character of the epoch in which we live, and to the extraordinary
occurrences which have signalized it. The convulsions with which several of
the powers of Europe have been shaken and the long and destructive wars in
which all were engaged, with their sudden transition to a state of peace,
presenting in the first instance unusual encouragement to our commerce and
withdrawing it in the second even within its wonted limit, could not fail
to be sensibly felt here. The station, too, which we had to support through
this long conflict, compelled as we were finally to become a party to it
with a principal power, and to make great exertions, suffer heavy losses,
and to contract considerable debts, disturbing the ordinary course of
affairs by augmenting to a vast amount the circulating medium, and thereby
elevating at one time the price of every article above a just standard and
depressing it at another below it, had likewise its due effect.

It is manifest that the pressures of which we complain have proceeded in a
great measure from these causes. When, then, we take into view the
prosperous and happy condition of our country in all the great
circumstances which constitute the felicity of a nation--every individual
in the full enjoyment of all his rights, the Union blessed with plenty and
rapidly rising to greatness under a National Government which operates with
complete effect in every part without being felt in any except by the ample
protection which it affords, and under State governments which perform
their equal share, according to a wise distribution of power between them,
in promoting the public happiness--it is impossible to behold so
gratifying, so glorious a spectacle without being penetrated with the most
profound and grateful acknowledgments to the Supreme Author of All Good for
such manifold and inestimable blessings.

Deeply impressed with these sentiments, I can not regard the pressures to
which I have adverted otherwise than in the light of mild and instructive
admonitions, warning us of dangers to be shunned in future, teaching us
lessons of economy corresponding with the simplicity and purity of our
institutions and best adapted to their support, evincing the connection and
dependence which the various parts of our happy Union have on each other,
thereby augmenting daily our social incorporation and adding by its strong
ties new strength and vigor to the political; opening a wider range, and
with new encouragement, to the industry and enterprise of our fellow
citizens at home and abroad, and more especially by the multiplied proofs
which it has accumulated of the great perfection of our most excellent
system of Government, the powerful instrument in the hands of our
All-merciful Creator in securing to us these blessings.

Happy as our situation is, it does not exempt us from solicitude and care
for the future. On the contrary, as the blessings which we enjoy are great,
proportionably great should be our vigilance, zeal, and activity to
preserve them. Foreign wars may again expose us to new wrongs, which would
impose on us new duties for which we ought to be prepared. The state of
Europe is unsettled, and how long peace may be preserved is altogether
uncertain; in addition to which we have interests of our own to adjust
which will require particular attention. A correct view of our relations
with each power will enable you to form a just idea of existing
difficulties, and of the measures of precaution best adapted to them.

Respecting our relations with Spain nothing explicit can now be
communicated. On the adjournment of Congress in May last the minister
plenipotentiary of the United States at Madrid was instructed to inform the
Government of Spain that if His Catholic Majesty should then ratify the
treaty this Government would accept the ratification so far as to submit to
the decision of the Senate the question whether such ratification should be
received in exchange for that of the United States heretofore given.

By letters from the minister of the United States to the Secretary of State
it appears that a communication in conformity with his instructions had
been made to the Government of Spain, and that the Cortes had the subject
under consideration. The result of the deliberations of that body, which is
daily expected, will be made known to Congress as soon as it is received.
The friendly sentiment which was expressed on the part of the United States
in the message of the 9th of May last is still entertained for Spain.

Among the causes of regret, however, which are inseparable from the delay
attending this transaction it is proper to state that satisfactory
information has been received that measures have been recently adopted by
designing persons to convert certain parts of the Province of East Florida
into depots for the reception of foreign goods, from whence to smuggle them
into the United States. By opening a port within the limits of Florida,
immediately on our boundary where there was no settlement, the object could
not be misunderstood. An early accommodation of differences will, it is
hoped, prevent all such fraudulent and pernicious practices, and place the
relations of the two countries on a very amicable and permanent basis.

The commercial relations between the United States and the British colonies
in the West Indies and on this continent have undergone no change, the
British Government still preferring to leave that commerce under the
restriction heretofore imposed on it on each side. It is satisfactory to
recollect that the restraints resorted to by the United States were
defensive only, intended to prevent a monopoly under British regulations in
favor of Great Britain, as it likewise is to know that the experiment is
advancing in a spirit of amity between the parties.

The question depending between the United States and Great Britain
respecting the construction of the first article of the treaty of Ghent has
been referred by both Governments to the decision of the Emperor of Russia,
who has accepted the umpirage.

An attempt has been made with the Government of France to regulate by
treaty the commerce between the two countries on the principle of
reciprocity and equality. By the last communication from the minister
plenipotentiary of the United States at Paris, to whom full power had been
given, we learn that the negotiation has been commenced there; but serious
difficulties having occurred, the French Government had resolved to
transfer it to the United States, for which purpose the minister
plenipotentiary of France had been ordered to repair to this city, and
whose arrival might soon be expected. It is hoped that this important
interest may be arranged on just conditions and in a manner equally
satisfactory to both parties. It is submitted to Congress to decide, until
such arrangement is made, how far it may be proper, on the principle of the
act of the last session which augmented the tonnage duty on French vessels,
to adopt other measures for carrying more completely into effect the policy
of that act.

The act referred to, which imposed new tonnage on French vessels, having
been in force from and after the first day of July, it has happened that
several vessels of that nation which had been dispatched from France before
its existence was known have entered the ports of the United States, and
been subject to its operation, without that previous notice which the
general spirit of our laws gives to individuals in similar cases. The
object of that law having been merely to countervail the inequalities which
existed to the disadvantage of the United States in their commercial
intercourse with France, it is submitted also to the consideration of
Congress whether, in the spirit of amity and conciliation which it is no
less the inclination than the policy of the United States to preserve in
their intercourse with other powers, it may not be proper to extend relief
to the individuals interested in those cases by exempting from the
operation of the law all those vessels which have entered our ports without
having had the means of previously knowing the existence of the additional
duty.

The contest between Spain and the colonies, according to the most authentic
information, is maintained by the latter with improved success. The
unfortunate divisions which were known to exist some time since at Buenos
Ayres it is understood still prevail. In no part of South America has Spain
made any impression on the colonies, while in many parts, and particularly
in Venezuela and New Grenada, the colonies have gained strength and
acquired reputation, both for the management of the war in which they have
been successful and for the order of the internal administration.

The late change in the Government of Spain, by the reestablishment of the
constitution of 1812, is an event which promises to be favorable to the
revolution. Under the authority of the Cortes the Congress of Angostura was
invited to open a negotiation for the settlement of differences between the
parties, to which it was replied that they would willingly open the
negotiation provided the acknowledgment of their independence was made its
basis, but not otherwise.

No facts are known to this Government to warrant the belief that any of the
powers of Europe will take part in the contest, whence it may be inferred,
considering all circumstances which must have weight in producing the
result, that an adjustment will finally take place on the basis proposed by
the colonies. To promote that result by friendly counsels with other
powers, including Spain herself, has been the uniform policy of this
Government.

In looking to the internal concerns of our country you will, I am
persuaded, derive much satisfaction from a view of the several objects to
which, in the discharge of your official duties, your attention will be
drawn. Among these none holds a more important place than the public
revenue, from the direct operation of the power by which it is raised on
the people, and by its influence in giving effect to every other power of
the Government. The revenue depends on the resources of the country, and
the facility by which the amount required is raised is a strong proof of
the extent of the resources and of the efficiency of the Government.

A few prominent facts will place this great interest in a just light before
you. On September 30th, 1815, the funded and floating debt of the United
States was estimated at $119,635,558. If to this sum be added the amount
of 5% stock subscribed to the Bank of the United States, the amount of
Mississippi stock and of the stock which was issued subsequently to that
date, and as afterwards liquidated, to $158,713,049.

On September 30th, 1820, it amounted to $91,993,883, having been reduced
in that interval by payments $66,879,165. During this term the expenses
of the Government of the United States were likewise defrayed in every
branch of the civil, military, and naval establishments; the public
edifices in this city have been rebuilt with considerable additions;
extensive fortifications have been commenced, and are in a train of
execution; permanent arsenals and magazines have been erected in various
parts of the Union; our Navy has been considerably augmented, and the
ordnance, munitions of war, and stores of the Army and Navy, which were
much exhausted during the war, have been replenished.

By the discharge of so large a proportion of the public debt and the
execution of such extensive and important operations in so short a time a
just estimate may be formed of the great extent of our national resources.
The demonstration is the more complete and gratifying when it is
recollected that the direct tax and excise were repealed soon after the
termination of the late war, and that the revenue applied to these purposes
has been derived almost wholly from other sources.

The receipts into the Treasury from every source to the 30th of September
last have amounted to $16,794,107.66, whilst the public expenditures to the
same period amounted to $16,871,534.72, leaving in the Treasury on that day
a sum estimated at $1.95 millions. For the probable receipts of the
following year I refer you to the statement which will be transmitted from
the Treasury.

The sum of $3 millions authorized to be raised by loan by an act of the
last session of Congress has been obtained upon terms advantageous to the
Government, indicating not only an increased confidence in the faith of the
nation, but the existence of a large amount of capital seeking that mode of
investment at a rate of interest not exceeding 5% per annum.

It is proper to add that there is now due to the Treasury for the sale of
public lands $22,996,545. In bringing this subject to view I consider it my
duty to submit to Congress whether it may not be advisable to extend to the
purchasers of these lands, in consideration of the unfavorable change which
has occurred since the sales, a reasonable indulgence. It is known that the
purchases were made when the price of every article had risen to its
greatest height, and the installments are becoming due at a period of great
depression. It is presumed that some plan may be devised by the wisdom of
Congress, compatible with the public interest, which would afford great
relief to these purchasers.

Considerable progress has been made during the present season in examining
the coast and its various bays and other inlets, in the collection of
materials, and in the construction of fortifications for the defense of the
Union at several of the positions at which it has been decided to erect
such works. At Mobile Point and Dauphin Island, and at the Rigolets,
leading to Lake Pontchartrain, materials to a considerable amount have been
collected, and all the necessary preparations made for the commencement of
the works. At Old Point Comfort, at the mouth of the James River, and at
the Rip-Rap, on the opposite shore in the Chesapeake Bay, materials to a
vast amount have been collected; and at the Old Point some progress has
been made in the construction of the fortification, which is on a very
extensive scale. The work at Fort Washington, on this river, will be
completed early in the next spring, and that on the Pea Patch, in the
Delaware, in the course of the next season. Fort Diamond, at the Narrows,
in the harbor of New York, will be finished this year. The works at
Boston, New York, Baltimore, Norfolk, Charleston, and Niagara have been
in part repaired, and the coast of North Carolina, extending south to
Cape Fear, has been examined, as have likewise other parts of the coast
eastward of Boston.

Great exertions have been made to push forward these works with the utmost
dispatch possible; but when their extent is considered, with the important
purposes for which they are intended--the defense of the whole coast, and,
in consequence, of the whole interior--and that they are to last for ages,
it will be manifest that a well-digested plan, founded on military
principles, connecting the whole together, combining security with economy,
could not be prepared without repeated examinations of the most exposed and
difficult parts, and that it would also take considerable time to collect
the materials at the several points where they would be required.

From all the light that has been shed on this subject I am satisfied that
every favorable anticipation which has been formed of this great
undertaking will be verified, and that when completed it will afford very
great if not complete protection to our Atlantic frontier in the event of
another war--protection sufficient to counterbalance in a single campaign
with an enemy powerful at sea the expense of all these works, without
taking into the estimate the saving of the lives of so many of our
citizens, the protection of our towns and other property, or the tendency
of such works to prevent war.

Our military positions have been maintained at Belle Point, on the
Arkansas, at Council Bluffs, on the Missouri, at St. Peters, on the
Mississippi, and at Green Bay, on the upper Lakes. Commodious barracks have
already been erected at most of these posts, with such works as were
necessary for their defense. Progress has also been made in opening
communications between them and in raising supplies at each for the support
of the troops by their own labor, particularly those most remote.

With the Indians peace has been preserved and a progress made in carrying
into effect the act of Congress making an appropriation for their
civilization, with the prospect of favorable results. As connected equally
with both these objects, our trade with those tribes is thought to merit
the attention of Congress.

In their original state game is their sustenance and war their occupation,
and if they find no employment from civilized powers they destroy each
other. Left to themselves their extirpation is inevitable.

By a judicious regulation of our trade with them we supply their wants,
administer to their comforts, and gradually, as the game retires, draw them
to us. By maintaining posts far in the interior we acquire a more thorough
and direct control over them, without which it is confidently believed that
a complete change in their manners can never be accomplished. By such
posts, aided by a proper regulation of our trade with them and a judicious
civil administration over them, to be provided for by law, we shall, it is
presumed, be enabled not only to protect our own settlements from their
savage incursions and preserve peace among the several tribes, but
accomplish also the great purpose of their civilization.

Considerable progress has also been made in the construction of ships of
war, some of which have been launched in the course of the present year.

Our peace with the powers on the coast of Barbary has been preserved, but
we owe it altogether to the presence of our squadron in the Mediterranean.
It has been found equally necessary to employ some of our vessels for the
protection of our commerce in the Indian Sea, the Pacific, and along the
Atlantic coast. The interests which we have depending in those quarters,
which have been much improved of late, are of great extent and of high
importance to the nation as well as to the parties concerned, and would
undoubtedly suffer if such protection was not extended to them. In
execution of the law of the last session for the suppression of the slave
trade some of our public ships have also been employed on the coast of
Africa, where several captures have already been made of vessels engaged in
that disgraceful traffic.