To the Senate and House of Representatives:

In coming before you for the first time as Chief Magistrate of this great
nation, it is with gratitude to the Giver of All Good for the many benefits
we enjoy. We are blessed with peace at home, and are without entangling
alliances abroad to forebode trouble; with a territory unsurpassed in
fertility, of an area equal to the abundant support of 500,000,000 people,
and abounding in every variety of useful mineral in quantity sufficient to
supply the world for generations; with exuberant crops; with a variety of
climate adapted to the production of every species of earth's riches and
suited to the habits, tastes, and requirements of every living thing; with
a population of 40,000,000 free people, all speaking one language; with
facilities for every mortal to acquire an education; with institutions
closing to none the avenues to fame or any blessing of fortune that may be
coveted; with freedom of the pulpit, the press, and the school; with a
revenue flowing into the National Treasury beyond the requirements of the
Government. Happily, harmony is being rapidly restored within our own
borders. Manufactures hitherto unknown in our country are springing up in
all sections, producing a degree of national independence unequaled by that
of any other power.

These blessings and countless others are intrusted to your care and mine
for safe-keeping for the brief period of our tenure of office. In a short
time we must, each of us, return to the ranks of the people, who have
conferred upon us our honors, and account to them for our stewardship. I
earnestly desire that neither you nor I may be condemned by a free and
enlightened constituency nor by our own consciences.

Emerging from a rebellion of gigantic magnitude, aided, as it was, by the
sympathies and assistance of nations with which we were at peace, eleven
States of the Union were, four years ago, left without legal State
governments. A national debt had been contracted; American commerce was
almost driven from the seas; the industry of one-half of the country had
been taken from the control of the capitalist and placed where all labor
rightfully belongs--in the keeping of the laborer. The work of restoring
State governments loyal to the Union, of protecting and fostering free
labor, and providing means for paying the interest on the public debt has
received ample attention from Congress. Although your efforts have not met
with the success in all particulars that might have been desired, yet on
the whole they have been more successful than could have been reasonably
anticipated.

Seven States which passed ordinances of secession have been fully restored
to their places in the Union. The eighth (Georgia) held an election at
which she ratified her constitution, republican in form, elected a
governor, Members of Congress, a State legislature, and all other officers
required. The governor was duly installed, and the legislature met and
performed all the acts then required of them by the reconstruction acts of
Congress. Subsequently, however, in violation of the constitution which
they had just ratified (as since decided by the supreme court of the
State), they unseated the colored members of the legislature and admitted
to seats some members who are disqualified by the third clause of the
fourteenth amendment to the Constitution--an article which they themselves
had contributed to ratify. Under these circumstances I would submit to you
whether it would not be wise, without delay, to enact a law authorizing the
governor of Georgia to convene the members originally elected to the
legislature, requiring each member to take the oath prescribed by the
reconstruction acts, and none to be admitted who are ineligible under the
third clause of the fourteenth amendment.

The freedmen, under the protection which they have received, are making
rapid progress in learning, and no complaints are heard of lack of industry
on their part where they receive fair remuneration for their labor. The
means provided for paying the interest on the public debt, with all other
expenses of Government, are more than ample. The loss of our commerce is
the only result of the late rebellion which has not received sufficient
attention from you. To this subject I call your earnest attention. I will
not now suggest plans by which this object may be effected, but will, if
necessary, make it the subject of a special message during the session of
Congress.

At the March term Congress by joint resolution authorized the Executive to
order elections in the States of Virginia, Mississippi, and Texas, to
submit to them the constitutions which each had previously, in convention,
framed, and submit the constitutions, either entire or in separate parts,
to be voted upon, at the discretion of the Executive. Under this authority
elections were called. In Virginia the election took place on the 6th of
July, 1869. The governor and lieutenant-governor elected have been
installed. The legislature met and did all required by this resolution and
by all the reconstruction acts of Congress, and abstained from all doubtful
authority. I recommend that her Senators and Representatives be promptly
admitted to their seats, and that the State be fully restored to its place
in the family of States. Elections were called in Mississippi and Texas, to
commence on the 30th of November, 1869, and to last two days in Mississippi
and four days in Texas. The elections have taken place, but the result is
not known. It is to be hoped that the acts of the legislatures of these
States, when they meet, will be such as to receive your approval, and thus
close the work of reconstruction.

Among the evils growing out of the rebellion, and not yet referred to, is
that of an irredeemable currency. It is an evil which I hope will receive
your most earnest attention. It is a duty, and one of the highest duties,
of Government to secure to the citizen a medium of exchange of fixed,
unvarying value. This implies a return to a specie basis, and no substitute
for it can be devised. It should be commenced now and reached at the
earliest practicable moment consistent with a fair regard to the interests
of the debtor class. Immediate resumption, if practicable, would not be
desirable. It would compel the debtor class to pay, beyond their contracts,
the premium on gold at the date of their purchase and would bring
bankruptcy and ruin to thousands. Fluctuation, however, in the paper value
of the measure of all values (gold) is detrimental to the interests of
trade. It makes the man of business an involuntary gambler, for in all
sales where future payment is to be made both parties speculate as to what
will be the value of the currency to be paid and received. I earnestly
recommend to you, then, such legislation as will insure a gradual return to
specie payments and put an immediate stop to fluctuations in the value of
currency.

The methods to secure the former of these results are as numerous as are
the speculators on political economy. To secure the latter I see but one
way, and that is to authorize the Treasury to redeem its own paper, at a
fixed price, whenever presented, and to withhold from circulation all
currency so redeemed until sold again for gold.

The vast resources of the nation, both developed and undeveloped, ought to
make our credit the best on earth. With a less burden of taxation than the
citizen has endured for six years past, the entire public debt could be
paid in ten years. But it is not desirable that the people should be taxed
to pay it in that time. Year by year the ability to pay increases in a
rapid ratio. But the burden of interest ought to be reduced as rapidly as
can be done without the violation of contract. The public debt is
represented in great part by bonds having from five to twenty and from ten
to forty years to run, bearing interest at the rate of 6 per cent and 5 per
cent, respectively. It is optional with the Government to pay these bonds
at any period after the expiration of the least time mentioned upon their
face. The time has already expired when a great part of them may be taken
up, and is rapidly approaching when all may be. It is believed that all
which are now due may be replaced by bonds bearing a rate of interest not
exceeding 4 1/2 per cent, and as rapidly as the remainder become due that
they may be replaced in the same way. To accomplish this it may be
necessary to authorize the interest to be paid at either of three or four
of the money centers of Europe, or by any assistant treasurer of the United
States, at the option of the holder of the bond. I suggest this subject for
the consideration of Congress, and also, simultaneously with this, the
propriety of redeeming our currency, as before suggested, at its market
value at the time the law goes into effect, increasing the rate at which
currency shall be bought and sold from day to day or week to week, at the
same rate of interest as Government pays upon its bonds.

The subjects of tariff and internal taxation will necessarily receive your
attention. The revenues of the country are greater than the requirements,
and may with safety be reduced. But as the funding of the debt in a 4 or a
4 1/2 per cent loan would reduce annual current expenses largely, thus,
after funding, justifying a greater reduction of taxation than would be now
expedient, I suggest postponement of this question until the next meeting
of Congress.

It may be advisable to modify taxation and tariff in instances where unjust
or burdensome discriminations are made by the present laws, but a general
revision of the laws regulating this subject I recommend the postponement
of for the present. I also suggest the renewal of the tax on incomes, but
at a reduced rate, say of 3 per cent, and this tax to expire in three
years.

With the funding of the national debt, as here suggested, I feel safe in
saying that taxes and the revenue from imports may be reduced safely from
sixty to eighty millions per annum at once, and may be still further
reduced from year to year, as the resources of the country are developed.

The report of the Secretary of the Treasury shows the receipts of the
Government for the fiscal year ending June 30, 1869, to be $370,943,747,
and the expenditures, including interest, bounties, etc., to be
$321,490,597. The estimates for the ensuing year are more favorable to the
Government, and will no doubt show a much larger decrease of the 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. Under these circumstances
the Secretary of the Treasury and myself heartily concurred in the
propriety of using all the surplus currency in the Treasury in the purchase
of Government bonds, thus reducing the interest-bearing indebtedness of the
country, and of submitting to Congress the question of the disposition to
be made of the bonds so purchased. The bonds now held by the Treasury
amount to about seventy-five millions, including those belonging to the
sinking fund. I 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 creation of the office of commissioner of
customs revenue; for the increase of salaries to certain classes of
officials; the substitution of increased national-bank circulation to
replace the outstanding 3 per cent certificates; and most especially to his
recommendation for the repeal of laws allowing shares of fines, penalties,
forfeitures, etc., to officers of the Government or to informers.

The office of Commissioner of Internal Revenue is one of the most arduous
and responsible under the Government. It falls but little, if any, short of
a Cabinet position in its importance and responsibilities. I would ask for
it, therefore, such legislation as in your judgment will place the office
upon a footing of dignity commensurate with its importance and with the
character and qualifications of the class of men required to fill it
properly.

As the United States is the freest of all nations, so, too, its people
sympathize with all people struggling for liberty and self-government; but
while so sympathizing it is due to our honor that we should abstain from
enforcing our views upon unwilling nations and from taking an interested
part, without invitation, in the quarrels between different nations or
between governments and their subjects. Our course should always be in
conformity with strict justice and law, international and local. Such has
been the policy of the Administration in dealing with these questions. For
more than a year a valuable province of Spain, and a near neighbor of ours,
in whom all our people can not but feel a deep interest, has been
struggling for independence and freedom. The people and Government of the
United States entertain the same warm feelings and sympathies for the
people of Cuba in their pending struggle that they manifested throughout
the previous struggles between Spain and her former colonies in behalf of
the latter. But the contest has at no time assumed the conditions which
amount to a war in the sense of international law, or which would show the
existence of a de facto political organization of the insurgents sufficient
to justify a recognition of belligerency.

The principle is maintained, however, that this nation is its own judge
when to accord the rights of belligerency, either to a people struggling to
free themselves from a government they believe to be oppressive or 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
believe that in due time Spain and other European powers will find their
interest in terminating those relations and establishing their present
dependencies as independent 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 ceases,
they are to become independent powers, exercising the right of choice and
of self-control in the determination of their future condition and
relations with other powers.

The United States, in order to put a stop to bloodshed in Cuba, and in the
interest of a neighboring people, proposed their good offices to bring the
existing contest to a termination. The offer, not being accepted by Spain
on a basis which we believed could be received by Cuba, was withdrawn. It
is hoped that the good offices of the United States may yet prove
advantageous for the settlement of this unhappy strife. Meanwhile a number
of illegal expeditions against Cuba have been broken up. It has been the
endeavor of the Administration to execute the neutrality laws in good
faith, no matter how unpleasant the task, made so by the sufferings we have
endured from lack of like good faith toward us by other nations.

On the 26th of March last the United States schooner Lizzie Major was
arrested on the high seas by a Spanish frigate, and two passengers taken
from it and carried as prisoners to Cuba. Representations of these facts
were made to the Spanish Government as soon as official information of them
reached Washington. The two passengers were set at liberty, and the Spanish
Government assured the United States that the captain of the frigate in
making the capture had acted without law, that he had been reprimanded for
the irregularity of his conduct, and that the Spanish authorities in Cuba
would not sanction any act that could violate the rights or treat with
disrespect the sovereignty of this nation.

The question of the seizure of the brig Mary Lowell at one of the Bahama
Islands by Spanish authorities is now the subject of correspondence between
this Government and those of Spain and Great Britain.

The Captain-General of Cuba about May last issued a proclamation
authorizing search to be made of vessels on the high seas. Immediate
remonstrance was made against this, whereupon the Captain-General issued a
new proclamation limiting the right of search to vessels of the United
States so far as authorized under the treaty of 1795. This proclamation,
however, was immediately withdrawn.

I have always felt that the most intimate relations should be cultivated
between the Republic of the United States and all independent nations on
this continent. It may be well worth considering whether new treaties
between us and them may not be profitably entered into, to secure more
intimate relations--friendly, commercial, and otherwise.

The subject of an interoceanic canal to connect the Atlantic and Pacific
oceans through the Isthmus of Darien is one in which commerce is greatly
interested. Instructions have been given to our minister to the Republic of
the United States of Colombia to endeavor to obtain authority for a survey
by this Government, in order to determine the practicability of such an
undertaking, and a charter for the right of way to build, by private
enterprise, such a work, if the survey proves it to be practicable.

In order to comply with the agreement of the United States as to a mixed
commission at Lima for the adjustment of claims, it became necessary to
send a commissioner and secretary to Lima in August last. No appropriation
having been made by Congress for this purpose, it is now asked that one be
made covering the past and future expenses of the commission.

The good offices of the United States to bring about a peace between Spain
and the South American Republics with which she is at war having been
accepted by Spain, Peru, and Chile, a congress has been invited to be held
in Washington during the present winter.

A grant has been given to Europeans of an exclusive right of transit over
the territory of Nicaragua, to which Costa Rico has given its assent,
which, it is alleged, conflicts with vested rights of citizens of the
United States. The Department of State has now this subject under
consideration.

The minister of Peru having made representations that there was a state of
war between Peru and Spain, and that Spain was constructing, in and near
New York, thirty gunboats, which might be used by Spain in such a way as to
relieve the naval force at Cuba, so as to operate against Peru, orders were
given to prevent their departure. No further steps having been taken by the
representative of the Peruvian Government to prevent the departure of these
vessels, and I not feeling authorized to detain the property of a nation
with which we are at peace on a mere Executive order, the matter has been
referred to the courts to decide.

The conduct of the war between the allies and the Republic of Paraguay has
made the intercourse with that country so difficult that it has been deemed
advisable to withdraw our representative from there.

Toward the close of the last Administration a convention was signed at
London for the settlement of all outstanding claims between Great Britain
and the United States, which failed to receive the advice and consent of
the Senate to its ratification. The time and the circumstances attending
the negotiation of that treaty were unfavorable to its acceptance by the
people of the United States, and its provisions were wholly inadequate for
the settlement of the grave wrongs that had been sustained by this
Government, as well as by its citizens. The injuries resulting to the
United States by reason of the course adopted by Great Britain during our
late civil war--in the increased rates of insurance; in the diminution of
exports and imports, and other obstructions to domestic industry and
production; in its effect upon the foreign commerce of the country; in the
decrease and transfer to Great Britain of our commercial marine; in the
prolongation of the war and the increased cost (both in treasure and in
lives) of its suppression could not be adjusted and satisfied as ordinary
commercial claims, which continually arise between commercial nations; and
yet the convention treated them simply as such ordinary claims, from which
they differ more widely in the gravity of their character than in the
magnitude of their amount, great even as is that difference. Not a word was
found in the treaty, and not an inference could be drawn from it, to remove
the sense of the unfriendliness of the course of Great Britain in our
struggle for existence, which had so deeply and universally impressed
itself upon the people of this country.

Believing that a convention thus misconceived in its scope and inadequate
in its provisions would not have produced the hearty, cordial settlement of
pending questions, which alone is consistent with the relations which I
desire to have firmly established between the United States and Great
Britain, I regarded the action of the Senate in rejecting the treaty to
have been wisely taken in the interest of peace and as a necessary step in
the direction of a perfect and cordial friendship between the two
countries. A sensitive people, conscious of their power, are more at ease
under a great wrong wholly unatoned than under the restraint of a
settlement which satisfies neither their ideas of justice nor their grave
sense of the grievance they have sustained. The rejection of the treaty was
followed by a state of public feeling on both sides which I thought not
favorable to an immediate attempt at renewed negotiations. I accordingly so
instructed the minister of the United States to Great Britain, and found
that my views in this regard were shared by Her Majesty's ministers. I hope
that the time may soon arrive when the two Governments can approach the
solution of this momentous question with an appreciation of what is due to
the rights, dignity, and honor of each, and with the determination not only
to remove the causes of complaint in the past, but to lay the foundation of
a broad principle of public law which will prevent future differences and
tend to firm and continued peace and friendship.

This is now the only grave question which the United States has with any
foreign nation.

The question of renewing a treaty for reciprocal trade between the United
States and the British Provinces on this continent has not been favorably
considered by the Administration. The advantages of such a treaty would be
wholly in favor of the British producer. Except, possibly, a few engaged in
the trade between the two sections, no citizen of the United States would
be benefited by reciprocity. Our internal taxation would prove a protection
to the British producer almost equal to the protection which our
manufacturers now receive from the tariff. Some arrangement, however, for
the regulation of commercial intercourse between the United States and the
Dominion of Canada may be desirable.

The commission for adjusting the claims of the "Hudsons Bay and Puget Sound
Agricultural Company" upon the United States has terminated its labors. The
award of $650,000 has been made and all rights and titles of the company on
the territory of the United States have been extinguished. Deeds for the
property of the company have been delivered. An appropriation by Congress
to meet this sum is asked.

The commissioners for determining the northwestern land boundary between
the United States and the British possessions under the treaty of 1856 have
completed their labors, and the commission has been dissolved.

In conformity with the recommendation of Congress, a proposition was early
made to the British Government to abolish the mixed courts created under
the treaty of April 7, 1862, for the suppression of the slave trade. The
subject is still under negotiation.

It having come to my knowledge that a corporate company, organized under
British laws, proposed to land upon the shores of the United States and to
operate there a submarine cable, under a concession from His Majesty the
Emperor of the French of an exclusive right for twenty years of telegraphic
communication between the shores of France and the United States, with the
very objectionable feature of subjecting all messages conveyed thereby to
the scrutiny and control of the French Government, I caused the French and
British legations at Washington to be made acquainted with the probable
policy of Congress on this subject, as foreshadowed by the bill which
passed the Senate in March last. This drew from the representatives of the
company an agreement to accept as the basis of their operations the
provisions of that bill, or of such other enactment on the subject as might
be passed during the approaching session of Congress; also, to use their
influence to secure from the French Government a modification of their
concession, so as to permit the landing upon French soil of any cable
belonging to any company incorporated by the authority of the United States
or of any State in the Union, and, on their part, not to oppose the
establishment of any such cable. In consideration of this agreement I
directed the withdrawal of all opposition by the United States authorities
to the landing of the cable and to the working of it until the meeting of
Congress. I regret to say that there has been no modification made in the
company's concession, nor, so far as I can learn, have they attempted to
secure one. Their concession excludes the capital and the citizens of the
United States from competition upon the shores of France. I recommend
legislation to protect the rights of citizens of the United States, as well
as the dignity and sovereignty of the nation, against such an assumption. I
shall also endeavor to secure, by negotiation, an abandonment of the
principle of monopolies in ocean telegraphic cables. Copies of this
correspondence are herewith furnished.

The unsettled political condition of other countries, less fortunate than
our own, sometimes induces their citizens to come to the United States for
the sole purpose of becoming naturalized. Having secured this, they return
to their native country and reside there, without disclosing their change
of allegiance. They accept official positions of trust or honor, which can
only be held by citizens of their native land; they journey under passports
describing them as such citizens; and it is only when civil discord, after
perhaps years of quiet, threatens their persons or their property, or when
their native state drafts them into its military service, that the fact of
their change of allegiance is made known. They reside permanently away from
the United States, they contribute nothing to its revenues, they avoid the
duties of its citizenship, and they only make themselves known by a claim
of protection. I have directed the diplomatic and consular officers of the
United States to scrutinize carefully all such claims for protection. The
citizen of the United States, whether native or adopted, who discharges his
duty to his country, is entitled to its complete protection. While I have a
voice in the direction of affairs I shall not consent to imperil this
sacred right by conferring it upon fictitious or fraudulent claimants.

On the accession of the present Administration it was found that the
minister for North Germany had made propositions for the negotiation of a
convention for the protection of emigrant passengers, to which no response
had been given. It was concluded that to be effectual all the maritime
powers engaged in the trade should join in such a measure. Invitations have
been extended to the cabinets of London, Paris, Florence, Berlin, Brussels,
The Hague, Copenhagen, and Stockholm to empower their representatives at
Washington to simultaneously enter into negotiations and to conclude with
the United States conventions identical in form, making uniform regulations
as to the construction of the parts of vessels to be devoted to the use of
emigrant passengers, as to the quality and quantity of food, as to the
medical treatment of the sick, and as to the rules to be observed during
the voyage, in order to secure ventilation, to promote health, to prevent
intrusion, and to protect the females; and providing for the establishment
of tribunals in the several countries for enforcing such regulations by
summary process.

Your attention is respectfully called to the law regulating the tariff on
Russian hemp, and to the question whether to fix the charges on Russian
hemp higher than they are fixed upon manila is not a violation of our
treaty with Russia placing her products upon the same footing with those of
the most favored nations.

Our manufactures are increasing with wonderful rapidity under the
encouragement which they now receive. With the improvements in machinery
already effected, and still increasing, causing machinery to take the place
of skilled labor to a large extent, our imports of many articles must fall
off largely within a very few years. Fortunately, too, manufactures are not
confined to a few localities, as formerly, and it is to be hoped will
become more and more diffused, making the interest in them equal in all
sections. They give employment and support to hundreds of thousands of
people at home, and retain with us the means which otherwise would be
shipped abroad. The extension of railroads in Europe and the East is
bringing into competition with our agricultural products like products of
other countries. Self-interest, if not self-preservation, therefore
dictates caution against disturbing any industrial interest of the country.
It teaches us also the necessity of looking to other markets for the sale
of our surplus. Our neighbors south of us and China and Japan, should
receive our special attention. It will be the endeavor of the
Administration to cultivate such relations with all these nations as to
entitle us to their confidence and make it their interest, as well as ours,
to establish better commercial relations.

Through the agency of a more enlightened policy than that heretofore
pursued toward China, largely due to the sagacity and efforts of one of our
own distinguished citizens, the world is about to commence largely
increased relations with that populous and hitherto exclusive nation. As
the United States have been the initiators in this new policy, so they
should be the most earnest in showing their good faith in making it a
success. In this connection I advise such legislation as will forever
preclude the enslavement of the Chinese upon our soil under the name of
coolies, and also prevent American vessels from engaging in the
transportation of coolies to any country tolerating the system. I also
recommend that the mission to China be raised to one of the first class.

On my assuming the responsible duties of Chief Magistrate of the United
States it was with the conviction that three things were essential to its
peace, prosperity, and fullest development. First among these is strict
integrity in fulfilling all our obligations; second, to secure protection
to the person and property of the citizen of the United States in each and
every portion of our common country, wherever he may choose to move,
without reference to original nationality, religion, color, or politics,
demanding of him only obedience to the laws and proper respect for the
rights of others; third, union of all the States, with equal rights,
indestructible by any constitutional means.

To secure the first of these, Congress has taken two essential steps:
First, in declaring by joint resolution that the public debt shall be paid,
principal and interest, in coin; and, second, by providing the means for
paying. Providing the means, however, could not secure the object desired
without a proper administration of the laws for the collection of the
revenues and an economical disbursement of them. To this subject the
Administration has most earnestly addressed itself, with results, I hope,
satisfactory to the country. There has been no hesitation in changing
officials in order to secure an efficient execution of the laws, sometimes,
too, when, in a mere party view, undesirable political results were likely
to follow; nor any hesitation in sustaining efficient officials against
remonstrances wholly political.

It may be well to mention here the embarrassment possible to arise from
leaving on the statute books the so-called "tenure-of-office acts," and to
earnestly recommend their total repeal. It could not have been the
intention of the framers of the Constitution, when providing that
appointments made by the President should receive the consent of the
Senate, that the latter should have the power to retain in office persons
placed there by Federal appointment against the will of the President. The
law is inconsistent with a faithful and efficient administration of the
Government. What faith can an Executive put in officials forced upon him,
and those, too, whom he has suspended for reason? How will such officials
be likely to serve an Administration which they know does not trust them?

For the second requisite to our growth and prosperity time and a firm but
humane administration of existing laws (amended from time to time as they
may prove ineffective or prove harsh and unnecessary) are probably all that
are required.

The third can not be attained by special legislation, but must be regarded
as fixed by the Constitution itself and gradually acquiesced in by force of
public opinion.

From the foundation of the Government to the present the management of the
original inhabitants of this continent--the Indians--has been a subject of
embarrassment and expense, and has been attended with continuous robberies,
murders, and wars. From my own experience upon the frontiers and in Indian
countries, I do not hold either legislation or the conduct of the whites
who come most in contact with the Indian blameless for these hostilities.
The past, however, can not be undone, and the question must be met as we
now find it. I have attempted a new policy toward these wards of the nation
(they can not be regarded in any other light than as wards), with fair
results so far as tried, and which I hope will be attended ultimately with
great success. The Society of Friends is well known as having succeeded in
living in peace with the Indians in the early settlement of Pennsylvania,
while their white neighbors of other sects in other sections were
constantly embroiled. They are also known for their opposition to all
strife, violence, and war, and are generally noted for their strict
integrity and fair dealings. These considerations induced me to give the
management of a few reservations of Indians to them and to throw the burden
of the selection of agents upon the society itself. The result has proven
most satisfactory. It will be found more fully set forth in the report of
the Commissioner of Indian Affairs. For superintendents and Indian agents
not on the reservations, officers of the Army were selected. The reasons
for this are numerous. Where Indian agents are sent, there, or near there,
troops must be sent also. The agent and the commander of troops are
independent of each other, and are subject to orders from different
Departments of the Government. The army officer holds a position for life;
the agent, one at the will of the President. The former is personally
interested in living in harmony with the Indian and in establishing a
permanent peace, to the end that some portion of his life may be spent
within the limits of civilized society; the latter has no such personal
interest. Another reason is an economic one; and still another, the hold
which the Government has upon a life officer to secure a faithful discharge
of duties in carrying out a given policy.

The building of railroads, and the access thereby given to all the
agricultural and mineral regions of the country, is rapidly bringing
civilized settlements into contact with all the tribes of Indians. No
matter what ought to be the relations between such settlements and the
aborigines, the fact is they do not harmonize well, and one or the other
has to give way in the end. A system which looks to the extinction of a
race is too horrible for a nation to adopt without entailing upon itself
the wrath of all Christendom and engendering in the citizen a disregard for
human life and the rights of others, dangerous to society. I see no
substitute for such a system, except in placing all the Indians on large
reservations, as rapidly as it can be done, and giving them absolute
protection there. As soon as they are fitted for it they should be induced
to take their lands in severalty and to set up Territorial governments for
their own protection. For full details on this subject I call your special
attention to the reports of the Secretary of the Interior and the
Commissioner of Indian Affairs.

The report of the Secretary of War shows the expenditures of the War
Department for the year ending June 30, 1869, to be $80,644,042, of which
$23,882,310 was disbursed in the payment of debts contracted during the
war, and is not chargeable to current army expenses. His estimate of
$34,531,031 for the expenses of the Army for the next fiscal year is as low
as it is believed can be relied on. The estimates of bureau officers have
been carefully scrutinized, and reduced wherever it has been deemed
practicable. If, however, the condition of the country should be such by
the beginning of the next fiscal year as to admit of a greater
concentration of troops, the appropriation asked for will not be expended.

The appropriations estimated for river and harbor improvements and for
fortifications are submitted separately. Whatever amount Congress may deem
proper to appropriate for these purposes will be expended.

The recommendation of the General of the Army that appropriations be made
for the forts at Boston. Portland, New York, Philadelphia, New Orleans, and
San Francisco, if for no other, is concurred in. I also ask your special
attention to the recommendation of the general commanding the Military
Division of the Pacific for the sale of the seal islands of St. Paul and
St. George, Alaska Territory, and suggest that it either be complied with
or that legislation be had for the protection of the seal fisheries from
which a revenue should be derived.

The report of the Secretary of War contains a synopsis of the reports of
the heads of bureaus, of the commanders of military divisions, and of the
districts of Virginia, Mississippi, and Texas, and the report of the
General of the Army in full. The recommendations therein contained have
been well considered, and are submitted for your action. I, however, call
special attention to the recommendation of the Chief of Ordnance for the
sale of arsenals and lands no longer of use to the Government; also, to the
recommendation of the Secretary of War that the act of 3d March, 1869,
prohibiting promotions and appointments in the staff corps of the Army, be
repealed. The extent of country to be garrisoned and the number of military
posts to be occupied is the same with a reduced Army as with a large one.
The number of staff officers required is more dependent upon the latter
than the former condition.

The report of the Secretary of the Navy accompanying this shows the
condition of the Navy when this Administration came into office and the
changes made since. Strenuous efforts have been made to place as many
vessels "in commission," or render them fit for service if required, as
possible, and to substitute the sail for steam while cruising, thus
materially reducing the expenses of the Navy and adding greatly to its
efficiency. Looking to our future, I recommend a liberal, though not
extravagant, policy toward this branch of the public service.

The report of the Postmaster-General furnishes a clear and comprehensive
exhibit of the operations of the postal service and of the financial
condition of the Post-Office Department. The ordinary postal revenues for
the year ending the 30th of June, 1869, amounted to $18,344,510, and the
expenditures to $23,698,131, showing an excess of expenditures over
receipts of $5,353,620. The excess of expenditures over receipts for the
previous year amounted to $6,437,992. The increase of revenues for 1869
over those of 1868 was $2,051,909, and the increase of expenditures was
$967,538. The increased revenue in 1869 exceeded the increased revenue in
1868 by $996,336, and the increased expenditure in 1869 was $2,527,570 less
than the increased expenditure in 1868, showing by comparison this
gratifying feature of improvement, that while the increase of expenditures
over the increase of receipts in 1868 was $2,439,535, the increase of
receipts over the increase of expenditures in 1869 was $1,084,371.

Your attention is respectfully called to the recommendations made by the
Postmaster-General for authority to change the rate of compensation to the
main trunk railroad lines for their services in carrying the mails; for
having post-route maps executed; for reorganizing and increasing the
efficiency of the special-agency service; for increase of the mail service
on the Pacific, and for establishing mail service, under the flag of the
Union, on the Atlantic; and most especially do I call your attention to his
recommendation for the total abolition of the franking privilege. This is
an abuse from which no one receives a commensurate advantage; it reduces
the receipts for postal service from 25 to 30 per cent and largely
increases the service to be performed. The method by which postage should
be paid upon public matter is set forth fully in the report of the
Postmaster-General.

The report of the Secretary of the Interior shows that the quantity of
public lands disposed of during the year ending the 30th of June, 1869, was
7,666,152 acres, exceeding that of the preceding year by 1,010,409 acres.
Of this amount 2,899,544 acres were sold for cash and 2,737,365 acres
entered under the homestead laws. The remainder was granted to aid in the
construction of works of internal improvement, approved to the States as
swamp land, and located with warrants and scrip. The cash receipts from all
sources were $4,472,886, exceeding those of the preceding year $2,840,140.

During the last fiscal year 23,196 names were added to the pension rolls
and 4,876 dropped therefrom, leaving at its close 187,963. The amount paid
to pensioners, including the compensation of disbursing agents, was
$28,422,884, an increase of $4,411,902 on that of the previous year. The
munificence of Congress has been conspicuously manifested in its
legislation for the soldiers and sailors who suffered in the recent
struggle to maintain "that unity of government which makes us one people."
The additions to the pension rolls of each successive year since the
conclusion of hostilities result in a great degree from the repeated
amendments of the act of the 14th of July, 1862, which extended its
provisions to cases not falling within its original scope. The large outlay
which is thus occasioned is further increased by the more liberal allowance
bestowed since that date upon those who in the line of duty were wholly or
permanently disabled. Public opinion has given an emphatic sanction to
these measures of Congress, and it will be conceded that no part of our
public burden is more cheerfully borne than that which is imposed by this
branch of the service. It necessitates for the next fiscal year, in
addition to the amount justly chargeable to the naval pension fund, an
appropriation of $30,000,000.

During the year ending the 30th of September, 1869, the Patent Office
issued 13,762 patents, and its receipts were $686,389, being $213,926 more
than the expenditures.

Messages and Papers of the Presidents, Ulysses S. Grant, vol. 6, p.3995

I would respectfully call your attention to the recommendation of the
Secretary of the Interior for uniting the duties of supervising the
education of freedmen with the other duties devolving upon the Commissioner
of Education.

If it is the desire of Congress to make the census which must be taken
during the year 1870 more complete and perfect than heretofore, I would
suggest early action upon any plan that may be agreed upon. As Congress at
the last session appointed a committee to take into consideration such
measures as might be deemed proper in reference to the census and report a
plan, I desist from saying more.

I recommend to your favorable consideration the claims of the Agricultural
Bureau for liberal appropriations. In a country so diversified in climate
and soil as ours, and with a population so largely dependent upon
agriculture, the benefits that can be conferred by properly fostering this
Bureau are incalculable.

I desire respectfully to call the attention of Congress to the inadequate
salaries of a number of the most important offices of the Government. In
this message I will not enumerate them, but will specify only the justices
of the Supreme Court. No change has been made in their salaries for fifteen
years. Within that time the labors of the court have largely increased and
the expenses of living have at least doubled. During the same time Congress
has twice found it necessary to increase largely the compensation of its
own members, and the duty which it owes to another department of the
Government deserves, and will undoubtedly receive, its due consideration.

There are many subjects not alluded to in this message which might with
propriety be introduced, but I abstain, believing that your patriotism and
statesmanship will suggest the topics and the legislation most conducive to
the interests of the whole people. On my part I promise a rigid adherence
to the laws and their strict enforcement.

U. S. GRANT