The apprehensions of a contemplated Mexican invasion have been since fully justified by the event. The determination of Mexico to rush into hostilities with the United States was afterwards manifested from the whole tenor of the note of the Mexican minister of foreign affairs to our minister bearing date on the 12th of March, 1846. Paredes had then revolutionized the Government, and his minister, after referring to the resolution for the annexation of Texas which had been adopted by our Congress in March, 1845, proceeds to declare that—

A fact such as this, or, to speak with greater exactness, so notable an act of usurpation, created an imperious necessity that Mexico, for her own honor, should repel it with proper firmness and dignity. The supreme Government had beforehand declared that it would look upon such an act as a casus belli, and as a consequence of this declaration negotiation was by its very nature at an end, and war was the only recourse of the Mexican Government.

It appears also that on the 4th of April following General Paredes, through his minister of war, issued orders to the Mexican general in command on the Texan frontier to "attack" our Army "by every means which war permits." To this General Paredes had been pledged to the army and people of Mexico during the military revolution which had brought him into power. On the 18th of April, 1846, General Paredes addressed a letter to the commander on that frontier in which he stated to him: "At the present date I suppose you, at the head of that valiant army, either fighting already or preparing for the operations of a campaign;" and, "Supposing you already on the theater of operations and with all the forces assembled, it is indispensable that hostilities be commenced, yourself taking the initiative against the enemy."

The movement of our Army to the Rio Grande was made by the commanding general under positive orders to abstain from all aggressive acts toward Mexico or Mexican citizens, and to regard the relations between the two countries as peaceful unless Mexico should declare war or commit acts of hostility indicative of a state of war, and these orders he faithfully executed. Whilst occupying his position on the east bank of the Rio Grande, within the limits of Texas, then recently admitted as one of the States of our Union, the commanding general of the Mexican forces, who, in pursuance of the orders of his Government, had collected a large army on the opposite shore of the Rio Grande, crossed the river, invaded our territory, and commenced hostilities by attacking our forces. Thus, after all the injuries which we had received and borne from Mexico, and after she had insultingly rejected a minister sent to her on a mission of peace, and whom she had solemnly agreed to receive, she consummated her long course of outrage against our country by commencing an offensive war and shedding the blood of our citizens on our own soil.

The United States never attempted to acquire Texas by conquest. On the contrary, at an early period after the people of Texas had achieved their independence they sought to be annexed to the United States. At a general election in September, 1836, they decided with great unanimity in favor of "annexation," and in November following the Congress of the Republic authorized the appointment of a minister to bear their request to this Government. This Government, however, having remained neutral between Texas and Mexico during the war between them, and considering it due to the honor of our country and our fair fame among the nations of the earth that we should not at this early period consent to annexation, nor until it should be manifest to the whole world that the reconquest of Texas by Mexico was impossible, refused to accede to the overtures made by Texas. On the 12th of April, 1844, after more than seven years had elapsed since Texas had established her independence, a treaty was concluded for the annexation of that Republic to the United States, which was rejected by the Senate. Finally, on the 1st of March, 1845, Congress passed a joint resolution for annexing her to the United States upon certain preliminary conditions to which her assent was required. The solemnities which characterized the deliberations and conduct of the Government and people of Texas on the deeply interesting questions presented by these resolutions are known to the world. The Congress, the Executive, and the people of Texas, in a convention elected for that purpose, accepted with great unanimity the proposed terms of annexation, and thus consummated on her part the great act of restoring to our Federal Union a vast territory which had been ceded to Spain by the Florida treaty more than a quarter of a century before.

After the joint resolution for the annexation of Texas to the United States had been passed by our Congress the Mexican minister at Washington addressed a note to the Secretary of State, bearing date on the 6th of March, 1845, protesting against it as "an act of aggression the most unjust which can be found recorded in the annals of modern history, namely, that of despoiling a friendly nation like Mexico of a considerable portion of her territory," and protesting against the resolution of annexation as being an act "whereby the Province of Texas, an integral portion of the Mexican territory, is agreed and admitted into the American Union;" and he announced that as a consequence his mission to the United States had terminated, and demanded his passports, which were granted. It was upon the absurd pretext, made by Mexico (herself indebted for her independence to a successful revolution), that the Republic of Texas still continued to be, notwithstanding all that had passed, a Province of Mexico that this step was taken by the Mexican minister.

Every honorable effort has been used by me to avoid the war which followed, but all have proved vain. All our attempts to preserve peace have been met by insult and resistance on the part of Mexico. My efforts to this end commenced in the note of the Secretary of State of the 10th of March, 1845, in answer to that of the Mexican minister. Whilst declining to reopen a discussion which had already been exhausted, and proving again what was known to the whole world, that Texas had long since achieved her independence, the Secretary of State expressed the regret of this Government that Mexico should have taken offense at the resolution of annexation passed by Congress, and gave assurance that our "most strenuous efforts shall be devoted to the amicable adjustment of every cause of complaint between the two Governments and to the cultivation of the kindest and most friendly relations between the sister Republics." That I have acted in the spirit of this assurance will appear from the events which have since occurred. Notwithstanding Mexico had abruptly terminated all diplomatic intercourse with the United States, and ought, therefore, to have been the first to ask for its resumption, yet, waiving all ceremony, I embraced the earliest favorable opportunity "to ascertain from the Mexican Government whether they would receive an envoy from the United States intrusted with full power to adjust all the questions in dispute between the two Governments." In September, 1845, I believed the propitious moment for such an overture had arrived. Texas, by the enthusiastic and almost unanimous will of her people, had pronounced in favor of annexation. Mexico herself had agreed to acknowledge the independence of Texas, subject to a condition, it is true, which she had no right to impose and no power to enforce. The last lingering hope of Mexico, if she still could have retained any, that Texas would ever again become one of her Provinces, must have been abandoned.

The consul of the United States at the City of Mexico was therefore instructed by the Secretary of State on the 15th of September, 1845, to make the inquiry of the Mexican Government. The inquiry was made, and on the 15th of October, 1845, the minister of foreign affairs of the Mexican Government, in a note addressed to our consul, gave a favorable response, requesting at the same time that our naval force might be withdrawn from Vera Cruz while negotiations should be pending. Upon the receipt of this note our naval force was promptly withdrawn from Vera Cruz. A minister was immediately appointed, and departed to Mexico. Everything bore a promising aspect for a speedy and peaceful adjustment of all our difficulties. At the date of my annual message to Congress in December last no doubt was entertained but that he would be received by the Mexican Government, and the hope was cherished that all cause of misunderstanding between the two countries would be speedily removed. In the confident hope that such would be the result of his mission, I informed Congress that I forbore at that time to "recommend such ulterior measures of redress for the wrongs and injuries we had so long borne as it would have been proper to make had no such negotiation been instituted." To my surprise and regret the Mexican Government, though solemnly pledged to do so, upon the arrival of our minister in Mexico refused to receive and accredit him. When he reached Vera Cruz, on the 30th of November, 1845, he found that the aspect of affairs had undergone an unhappy change. The Government of General Herrera, who was at that time President of the Republic, was tottering to its fall. General Paredes, a military leader, had manifested his determination to overthrow the Government of Herrera by a military revolution, and one of the principal means which he employed to effect his purpose and render the Government of Herrera odious to the army and people of Mexico was by loudly condemning its determination to receive a minister of peace from the United States, alleging that it was the intention of Herrera, by a treaty with the United States, to dismember the territory of Mexico by ceding away the department of Texas. The Government of Herrera is believed to have been well disposed to a pacific adjustment of existing difficulties, but probably alarmed for its own security, and in order to ward off the danger of the revolution led by Paredes, violated its solemn agreement and refused to receive or accredit our minister; and this although informed that he had been invested with full power to adjust all questions in dispute between the two Governments. Among the frivolous pretexts for this refusal, the principal one was that our minister had not gone upon a special mission confined to the question of Texas alone, leaving all the outrages upon our flag and our citizens unredressed. The Mexican Government well knew that both our national honor and the protection due to our citizens imperatively required that the two questions of boundary and indemnity should be treated of together, as naturally and inseparably blended, and they ought to have seen that this course was best calculated to enable the United States to extend to them the most liberal justice. On the 30th of December, 1845, General Herrera resigned the Presidency and yielded up the Government to General Paredes without a struggle. Thus a revolution was accomplished solely by the army commanded by Paredes, and the supreme power in Mexico passed into the hands of a military usurper who was known to be bitterly hostile to the United States.

Although the prospect of a pacific adjustment with the new Government was unpromising from the known hostility of its head to the United States, yet, determined that nothing should be left undone on our part to restore friendly relations between the two countries, our minister was instructed to present his credentials to the new Government and ask to be accredited by it in the diplomatic character in which he had been commissioned. These instructions he executed by his note of the 1st of March, 1846, addressed to the Mexican minister of foreign affairs, but his request was insultingly refused by that minister in his answer of the 12th of the same month. No alternative remained for our minister but to demand his passports and return to the United States.

Thus was the extraordinary spectacle presented to the civilized world of a Government, in violation of its own express agreement, having twice rejected a minister of peace invested with full powers to adjust all the existing differences between the two countries in a manner just and honorable to both. I am not aware that modern history presents a parallel case in which in time of peace one nation has refused even to hear propositions from another for terminating existing difficulties between them. Scarcely a hope of adjusting our difficulties, even at a remote day, or of preserving peace with Mexico, could be cherished while Paredes remained at the head of the Government. He had acquired the supreme power by a military revolution and upon the most solemn pledges to wage war against the United States and to reconquer Texas, which he claimed as a revolted province of Mexico. He had denounced as guilty of treason all those Mexicans who considered Texas as no longer constituting a part of the territory of Mexico and who were friendly to the cause of peace. The duration of the war which he waged against the United States was indefinite, because the end which he proposed of the reconquest of Texas was hopeless. Besides, there was good reason to believe from all his conduct that it was his intention to convert the Republic of Mexico into a monarchy and to call a foreign European prince to the throne. Preparatory to this end, he had during his short rule destroyed the liberty of the press, tolerating that portion of it only which openly advocated the establishment of a monarchy. The better to secure the success of his ultimate designs, he had by an arbitrary decree convoked a Congress, not to be elected by the free voice of the people, but to be chosen in a manner to make them subservient to his will and to give him absolute control over their deliberations.

Under all these circumstances it was believed that any revolution in Mexico founded upon opposition to the ambitious projects of Paredes would tend to promote the cause of peace as well as prevent any attempted European interference in the affairs of the North American continent, both objects of deep interest to the United States. Any such foreign interference, if attempted, must have been resisted by the United States. My views upon that subject were fully communicated to Congress in my last annual message. In any event, it was certain that no change whatever in the Government of Mexico which would deprive Paredes of power could be for the worse so far as the United States were concerned, while it was highly probable that any change must be for the better. This was the state of affairs existing when Congress, on the 13th of May last, recognized the existence of the war which had been commenced by the Government of Paredes; and it became an object of much importance, with a view to a speedy settlement of our difficulties and the restoration of an honorable peace, that Paredes should not retain power in Mexico.

Before that time there were symptoms of a revolution in Mexico, favored, as it was understood to be, by the more liberal party, and especially by those who were opposed to foreign interference and to the monarchical form of government. Santa Anna was then in exile in Havana, having been expelled from power and banished from his country by a revolution which occurred in December, 1844; but it was known that he had still a considerable party in his favor in Mexico. It was also equally well known that no vigilance which could be exerted by our squadron would in all probability have prevented him from effecting a landing somewhere on the extensive Gulf coast of Mexico if he desired to return to his country. He had openly professed an entire change of policy, had expressed his regret that he had subverted the federal constitution of 1824, and avowed that he was now in favor of its restoration. He had publicly declared his hostility, in strongest terms, to the establishment of a monarchy and to European interference in the affairs of his country. Information to this effect had been received, from sources believed to be reliable, at the date of the recognition of the existence of the war by Congress, and was afterwards fully confirmed by the receipt of the dispatch of our consul in the City of Mexico, with the accompanying documents, which are herewith transmitted. Besides, it was reasonable to suppose that he must see the ruinous consequences to Mexico of a war with the United States, and that it would be his interest to favor peace.

It was under these circumstances and upon these considerations that it was deemed expedient not to obstruct his return to Mexico should he attempt to do so. Our object was the restoration of peace, and, with that view, no reason was perceived why we should take part with Paredes and aid him by means of our blockade in preventing the return of his rival to Mexico. On the contrary, it was believed that the intestine divisions which ordinary sagacity could not but anticipate as the fruit of Santa Anna's return to Mexico, and his contest with Paredes, might strongly tend to produce a disposition with both parties to restore and preserve peace with the United States. Paredes was a soldier by profession and a monarchist in principle. He had but recently before been successful in a military revolution, by which he had obtained power. He was the sworn enemy of the United States, with which he had involved his country in the existing war. Santa Anna had been expelled from power by the army, was known to be in open hostility to Paredes, and publicly pledged against foreign intervention and the restoration of monarchy in Mexico. In view of these facts and circumstances it was that when orders were issued to the commander of our naval forces in the Gulf, on the 13th day of May last, the same day on which the existence of the war was recognized by Congress, to place the coasts of Mexico under blockade, he was directed not to obstruct the passage of Santa Anna to Mexico should he attempt to return.

A revolution took place in Mexico in the early part of August following, by which the power of Paredes was overthrown, and he has since been banished from the country, and is now in exile. Shortly afterwards Santa Anna returned. It remains to be seen whether his return may not yet prove to be favorable to a pacific adjustment of the existing difficulties, it being manifestly his interest not to persevere in the prosecution of a war commenced by Paredes to accomplish a purpose so absurd as the reconquest of Texas to the Sabine. Had Paredes remained in power, it is morally certain that any pacific adjustment would have been hopeless.

Upon the commencement of hostilities by Mexico against the United States the indignant spirit of the nation was at once aroused. Congress promptly responded to the expectations of the country, and by the act of the 13th of May last recognized the fact that war existed, by the act of Mexico, between the United States and that Republic, and granted the means necessary for its vigorous prosecution. Being involved in a war thus commenced by Mexico, and for the justice of which on our part we may confidently appeal to the whole world, I resolved to prosecute it with the utmost vigor. Accordingly the ports of Mexico on the Gulf and on the Pacific have been placed under blockade and her territory invaded at several important points. The reports from the Departments of War and of the Navy will inform you more in detail of the measures adopted in the emergency in which our country was placed and of the gratifying results which have been accomplished.

The various columns of the Army have performed their duty under great disadvantages with the most distinguished skill and courage. The victories of Palo Alto and Resaca de la Palma and of Monterey, won against greatly superior numbers and against most decided advantages in other respects on the part of the enemy, were brilliant in their execution, and entitle our brave officers and soldiers to the grateful thanks of their country. The nation deplores the loss of the brave officers and men who have gallantly fallen while vindicating and defending their country's rights and honor.

It is a subject of pride and satisfaction that our volunteer citizen soldiers, who so promptly responded to their country's call, with an experience of the discipline of a camp of only a few weeks, have borne their part in the hard-fought battle of Monterey with a constancy and courage equal to that of veteran troops and worthy of the highest admiration. The privations of long marches through the enemy's country and through a wilderness have been borne without a murmur. By rapid movements the Province of New Mexico, with Santa Fe, its capital, has been captured without bloodshed. The Navy has cooperated with the Army and rendered important services; if not so brilliant, it is because the enemy had no force to meet them on their own element and because of the defenses which nature has interposed in the difficulties of the navigation on the Mexican coast. Our squadron in the Pacific, with the cooperation of a gallant officer of the Army and a small force hastily collected in that distant country, has acquired bloodless possession of the Californias, and the American flag has been raised at every important point in that Province.

I congratulate you on the success which has thus attended our military and naval operations. In less than seven months after Mexico commenced hostilities, at a time selected by herself, we have taken possession of many of her principal ports, driven back and pursued her invading army, and acquired military possession of the Mexican Provinces of New Mexico, New Leon, Coahuila, Tamaulipas, and the Californias, a territory larger in extent than that embraced in the original thirteen States of the Union, inhabited by a considerable population, and much of it more than 1,000 miles from the points at which we had to collect our forces and commence our movements. By the blockade the import and export trade of the enemy has been cut off. Well may the American people be proud of the energy and gallantry of our regular and volunteer officers and soldiers. The events of these few months afford a gratifying proof that our country can under any emergency confidently rely for the maintenance of her honor and the defense of her rights on an effective force, ready at all times voluntarily to relinquish the comforts of home for the perils and privations of the camp. And though such a force may be for the time expensive, it is in the end economical, as the ability to command it removes the necessity of employing a large standing army in time of peace, and proves that our people love their institutions and are ever ready to defend and protect them.

While the war was in a course of vigorous and successful prosecution, being still anxious to arrest its evils, and considering that after the brilliant victories of our arms on the 8th and 9th of May last the national honor could not be compromitted by it, another overture was made to Mexico, by my direction, on the 27th of July last to terminate hostilities by a peace just and honorable to both countries. On the 31st of August following the Mexican Government declined to accept this friendly overture, but referred it to the decision of a Mexican Congress to be assembled in the early part of the present month. I communicate to you herewith a copy of the letter of the Secretary of State proposing to reopen negotiations, of the answer of the Mexican Government, and of the reply thereto of the Secretary of State,

The war will continue to be prosecuted with vigor as the best means of securing peace. It is hoped that the decision of the Mexican Congress, to which our last overture has been referred, may result in a speedy and honorable peace. With our experience, however, of the unreasonable course of the Mexican authorities, it is the part of wisdom not to relax in the energy of our military operations until the result is made known. In this view it is deemed important to hold military possession of all the Provinces which have been taken until a definitive treaty of peace shall have been concluded and ratified by the two countries.

The war has not been waged with a view to conquest, but, having been commenced by Mexico, it has been carried into the enemy's country and will be vigorously prosecuted there with a view to obtain an honorable peace, and thereby secure ample indemnity for the expenses of the war, as well as to our much-injured citizens, who hold large pecuniary demands against Mexico.

By the laws of nations a conquered country is subject to be governed by the conqueror during his military possession and until there is either a treaty of peace or he shall voluntarily withdraw from it. The old civil government being necessarily superseded, it is the right and duty of the conqueror to secure his conquest and to provide for the maintenance of civil order and the rights of the inhabitants. This right has been exercised and this duty performed by our military and naval commanders by the establishment of temporary governments in some of the conquered Provinces of Mexico, assimilating them as far as practicable to the free institutions of our own country. In the Provinces of New Mexico and of the Californias little, if any, further resistance is apprehended from the inhabitants to the temporary governments which have thus, from the necessity of the case and according to the laws of war, been established. It may be proper to provide for the security of these important conquests by making an adequate appropriation for the purpose of erecting fortifications and defraying the expenses necessarily incident to the maintenance of our possession and authority over them.

Near the close of your last session, for reasons communicated to Congress, I deemed it important as a measure for securing a speedy peace with Mexico, that a sum of money should be appropriated and placed in the power of the Executive, similar to that which had been made upon two former occasions during the Administration of President Jefferson.

On the 26th of February, 1803, an appropriation of $2,000.000 was made and placed at the disposal of the President. Its object is well known. It was at that time in contemplation to acquire Louisiana from France, and it was intended to be applied as a part of the consideration which might be paid for that territory. On the 13th of February, 1806, the same sum was in like manner appropriated, with a view to the purchase of the Floridas from Spain. These appropriations were made to facilitate negotiations and as a means to enable the President to accomplish the important objects in view. Though it did not become necessary for the President to use these appropriations, yet a state of things might have arisen in which it would have been highly important for him to do so, and the wisdom of making them can not be doubted. It is believed that the measure recommended at your last session met with the approbation of decided majorities in both Houses of Congress. Indeed, in different forms, a bill making an appropriation of $2,000,000 passed each House, and it is much to be regretted that it did not become a law. The reasons which induced me to recommend the measure at that time still exist, and I again submit the subject for your consideration and suggest the importance of early action upon it. Should the appropriation be made and be not needed, it will remain in the Treasury; should it be deemed proper to apply it in whole or in part, it will be accounted for as other public expenditures.

Immediately after Congress had recognized the existence of the war with Mexico my attention was directed to the danger that privateers might be fitted out in the ports of Cuba and Porto Rico to prey upon the commerce of the United States, and I invited the special attention of the Spanish Government to the fourteenth article of our treaty with that power of the 27th of October, 1795, under which the citizens and subjects of either nation who shall take commissions or letters of marque to act as privateers against the other "shall be punished as pirates."

It affords me pleasure to inform you that I have received assurances from the Spanish Government that this article of the treaty shall be faithfully observed on its part. Orders for this purpose were immediately transmitted from that Government to the authorities of Cuba and Porto Rico to exert their utmost vigilance in preventing any attempts to fit out privateers in those islands against the United States. From the good faith of Spain I am fully satisfied that this treaty will be executed in its spirit as well as its letter, whilst the United States will on their part faithfully perform all the obligations which it imposes on them.

Information has been recently received at the Department of State that the Mexican Government has sent to Havana blank commissions to privateers and blank certificates of naturalization signed by General Salas, the present head of the Mexican Government. There is also reason to apprehend that similar documents have been transmitted to other parts of the world. Copies of these papers, in translation, are herewith transmitted.

As the preliminaries required by the practice of civilized nations for commissioning privateers and regulating their conduct appear not to have been observed, and as these commissions are in blank, to be filled up with the names of citizens and subjects of all nations who may be willing to purchase them, the whole proceeding can only be construed as an invitation to all the freebooters upon earth who are willing to pay for the privilege to cruise against American commerce. It will be for our courts of justice to decide whether under such circumstances these Mexican letters of marque and reprisal shall protect those who accept them, and commit robberies upon the high seas under their authority, from the pains and penalties of piracy.

If the certificates of naturalization thus granted be intended by Mexico to shield Spanish subjects from the guilt and punishment of pirates under our treaty with Spain, they will certainly prove unavailing. Such a subterfuge would be but a weak device to defeat the provisions of a solemn treaty.

I recommend that Congress should immediately provide by law for the trial and punishment as pirates of Spanish subjects who, escaping the vigilance of their Government, shall be found guilty of privateering against the United States. I do not apprehend serious danger from these privateers. Our Navy will be constantly on the alert to protect our commerce. Besides, in case prizes should be made of American vessels, the utmost vigilance will be exerted by our blockading squadron to prevent the captors from taking them into Mexican ports, and it is not apprehended that any nation will violate its neutrality by suffering such prizes to be condemned and sold within its jurisdiction.

I recommend that Congress should immediately provide by law for granting letters of marque and reprisal against vessels under the Mexican flag. It is true that there are but few, if any, commercial vessels of Mexico upon the high seas, and it is therefore not probable that many American privateers would be fitted out in case a law should pass authorizing this mode of warfare. It is, notwithstanding, certain that such privateers may render good service to the commercial interests of the country by recapturing our merchant ships should any be taken by armed vessels under the Mexican flag, as well as by capturing these vessels themselves. Every means within our power should be rendered available for the protection of our commerce.

The annual report of the Secretary of the Treasury will exhibit a detailed statement of the condition of the finances. The imports for the fiscal year ending on the 30th of June last were of the value of $121,691,797, of which the amount exported was $11,346,623, leaving the amount retained in the country for domestic consumption $110,345,174. The value of the exports for the same period was $113,488,516, of which $102,141,893 consisted of domestic productions and $11,346,623 of foreign articles.

The receipts into the Treasury for the same year were $29,499,247.06, of which there was derived from customs $26,712,667.87, from the sales of public lands $2,694,452.48, and from incidental and miscellaneous sources $92,126.71. The expenditures for the same period were $28,031,114.20, and the balance in the Treasury on the 1st day of July last was $9,126,439. 08.

The amount of the public debt, including Treasury notes, on the 1st of the present month was $24,256,494.60, of which the sum of $17,788,799.62 was outstanding on the 4th of March, 1845, leaving the amount incurred since that time $6,467,694.98.

In order to prosecute the war with Mexico with vigor and energy, as the best means of bringing it to a speedy and honorable termination, a further loan will be necessary to meet the expenditures for the present and the next fiscal year. If the war should be continued until the 30th of June, 1848, being the end of the next fiscal year, it is estimated that an additional loan of $23,000,000 will be required. This estimate is made upon the assumption that it will be necessary to retain constantly in the Treasury $4,000,000 to guard against contingencies. If such surplus were not required to be retained, then a loan of $19,000,000 would be sufficient. If, however, Congress should at the present session impose a revenue duty on the principal articles now embraced in the free list, it is estimated that an additional annual revenue of about two millions and a half, amounting, it is estimated, on the 30th of June, 1848, to $4,000,000, would be derived from that source, and the loan required would be reduced by that amount. It is estimated also that should Congress graduate and reduce the price of such of the public lands as have been long in the market the additional revenue derived from that source would be annually, for several years to come, between half a million and a million dollars; and the loan required may be reduced by that amount also. Should these measures be adopted, the loan required would not probably exceed $18,000,000 or $19,000,000, leaving in the Treasury a constant surplus of $4,000,000. The loan proposed, it is estimated, will be sufficient to cover the necessary expenditures both for the war and for all other purposes up to the 30th of June, 1848, and an amount of this loan not exceeding one-half may be required during the present fiscal year, and the greater part of the remainder during the first half of the fiscal year succeeding.

In order that timely notice may be given and proper measures taken to effect the loan, or such portion of it as may be required, it is important that the authority of Congress to make it be given at an early period of your present session. It is suggested that the loan should be contracted for a period of twenty years, with authority to purchase the stock and pay it off at an earlier period at its market value out of any surplus which may at any time be in the Treasury applicable to that purpose. After the establishment of peace with Mexico, it is supposed that a considerable surplus will exist, and that the debt may be extinguished in a much shorter period than that for which it may be contracted. The period of twenty years, as that for which the proposed loan may be contracted, in preference to a shorter period, is suggested, because all experience, both at home and abroad, has shown that loans are effected upon much better terms upon long time than when they are reimbursable at short dates.

Necessary as this measure is to sustain the honor and the interests of the country engaged in a foreign war, it is not doubted but that Congress will promptly authorize it.

The balance in the Treasury on the 1st July last exceeded $9,000,000, notwithstanding considerable expenditures had been made for the war during the months of May and June preceding. But for the war the whole public debt could and would have been extinguished within a short period; and it was a part of my settled policy to do so, and thus relieve the people from its burden and place the Government in a position which would enable it to reduce the public expenditures to that economical standard which is most consistent with the general welfare and the pure and wholesome progress of our institutions.

Among our just causes of complaint against Mexico arising out of her refusal to treat for peace, as well before as since the war so unjustly commenced on her part, are the extraordinary expenditures in which we have been involved. Justice to our own people will make it proper that Mexico should be held responsible for these expenditures.

Economy in the public expenditures is at all times a high duty which all public functionaries of the Government owe to the people. This duty becomes the more imperative in a period of war, when large and extraordinary expenditures become unavoidable. During the existence of the war with Mexico all our resources should be husbanded, and no appropriations made except such as are absolutely necessary for its vigorous prosecution and the due administration of the Government. Objects of appropriation which in peace may be deemed useful or proper, but which are not indispensable for the public service, may when the country is engaged in a foreign war be well postponed to a future period. By the observance of this policy at your present session large amounts may be saved to the Treasury and be applied to objects of pressing and urgent necessity, and thus the creation of a corresponding amount of public debt may be avoided.

It is not meant to recommend that the ordinary and necessary appropriations for the support of Government should be withheld; but it is well known that at every session of Congress appropriations are proposed for numerous objects which may or may not be made without materially affecting the public interests, and these it is recommended should not be granted.

The act passed at your last session "reducing the duties on imports" not having gone into operation until the 1st of the present month, there has not been time for its practical effect upon the revenue and the business of the country to be developed. It is not doubted, however, that the just policy which it adopts will add largely to our foreign trade and promote the general prosperity. Although it can not be certainly foreseen what amount of revenue it will yield, it is estimated that it will exceed that produced by the act of 1842, which it superseded. The leading principles established by it are to levy the taxes with a view to raise revenue and to impose them upon the articles imported according to their actual value.

The act of 1842, by the excessive rates of duty which it imposed on many articles, either totally excluded them from importation or greatly reduced the amount imported, and thus diminished instead of producing revenue. By it the taxes were imposed not for the legitimate purpose of raising revenue, but to afford advantages to favored classes at the expense of a large majority of their fellow-citizens. Those employed in agriculture, mechanical pursuits, commerce, and navigation were compelled to contribute from their substance to swell the profits and overgrown wealth of the comparatively few who had invested their capital in manufactures. The taxes were not levied in proportion to the value of the articles upon which they were imposed, but, widely departing from this just rule, the lighter taxes were in many cases levied upon articles of luxury and high price and the heavier taxes on those of necessity and low price, consumed by the great mass of the people. It was a system the inevitable effect of which was to relieve favored classes and the wealthy few from contributing their just proportion for the support of Government, and to lay the burden on the labor of the many engaged in other pursuits than manufactures.

A system so unequal and unjust has been superseded by the existing law, which imposes duties not for the benefit or injury of classes or pursuits, but distributes and, as far as practicable, equalizes the public burdens among all classes and occupations. The favored classes who under the unequal and unjust system which has been repealed have heretofore realized large profits, and many of them amassed large fortunes at the expense of the many who have been made tributary to them, will have no reason to complain if they shall be required to bear their just proportion of the taxes necessary for the support of Government. So far from it, it will be perceived by an examination of the existing law that discriminations in the rates of duty imposed within the revenue principle have been retained in their favor. The incidental aid against foreign competition which they still enjoy gives them an advantage which no other pursuits possess, but of this none others will complain, because the duties levied are necessary for revenue. These revenue duties, including freights and charges, which the importer must pay before he can come in competition with the home manufacturer in our markets, amount on nearly all our leading branches of manufacture to more than one-third of the value of the imported article, and in some cases to almost one-half its value. With such advantages it is not doubted that our domestic manufacturers will continue to prosper, realizing in well-conducted establishments even greater profits than can be derived from any other regular business. Indeed, so far from requiring the protection of even incidental revenue duties, our manufacturers in several leading branches are extending their business, giving evidence of great ingenuity and skill and of their ability to compete, with increased prospect of success, for the open market of the world. Domestic manufactures to the value of several millions of dollars, which can not find a market at home, are annually exported to foreign countries. With such rates of duty as those established by the existing law the system will probably be permanent, and capitalists who are made or shall hereafter make their investments in manufactures will know upon what to rely. The country will be satisfied with these rates, because the advantages which the manufacturers still enjoy result necessarily from the collection of revenue for the support of Government. High protective duties, from their unjust operation upon the masses of the people, can not fail to give rise to extensive dissatisfaction and complaint and to constant efforts to change or repeal them, rendering all investments in manufactures uncertain and precarious. Lower and more permanent rates of duty, at the same time that they will yield to the manufacturer fair and remunerating profits, will secure him against the danger of frequent changes in the system, which can not fail to ruinously affect his interests.

Simultaneously with the relaxation of the restrictive policy by the United States, Great Britain, from whose example we derived the system, has relaxed hers. She has modified her corn laws and reduced many other duties to moderate revenue rates. After ages of experience the statesmen of that country have been constrained by a stern necessity and by a public opinion having its deep foundation in the sufferings and wants of impoverished millions to abandon a system the effect of which was to build up immense fortunes in the hands of the few and to reduce the laboring millions to pauperism and misery. Nearly in the same ratio that labor was depressed capital was increased and concentrated by the British protective policy.

The evils of the system in Great Britain were at length rendered intolerable, and it has been abandoned, but not without a severe struggle on the part of the protected and favored classes to retain the unjust advantages which they have so long enjoyed. It was to be expected that a similar struggle would be made by the same classes in the United States whenever an attempt was made to modify or abolish the same unjust system here. The protective policy had been in operation in the United States for a much shorter period, and its pernicious effects were not, therefore, so clearly perceived and felt. Enough, however, was known of these effects to induce its repeal.

It would be strange if in the face of the example of Great Britain, our principal foreign customer, and of the evils of a system rendered manifest in that country by long and painful experience, and in the face of the immense advantages which under a more liberal commercial policy we are already deriving, and must continue to derive, by supplying her starving population with food, the United States should restore a policy which she has been compelled to abandon, and thus diminish her ability to purchase from us the food and other articles which she so much needs and we so much desire to sell. By the simultaneous abandonment of the protective policy by Great Britain and the United States new and important markets have already been opened for our agricultural and other products, commerce and navigation have received a new impulse, labor and trade have been released from the artificial trammels which have so long fettered them, and to a great extent reciprocity in the exchange of commodities has been introduced at the same time by both countries, and greatly for the benefit of both. Great Britain has been forced by the pressure of circumstances at home to abandon a policy which has been upheld for ages, and to open her markets for our immense surplus of breadstuffs, and it is confidently believed that other powers of Europe will ultimately see the wisdom, if they be not compelled by the pauperism and sufferings of their crowded population, to pursue a similar policy.

Our farmers are more deeply interested in maintaining the just and liberal policy of the existing law than any other class of our citizens. They constitute a large majority of our population, and it is well known that when they prosper all other pursuits prosper also. They have heretofore not only received none of the bounties or favors of Government, but by the unequal operations of the protective policy have been made by the burdens of taxation which it imposed to contribute to the bounties which have enriched others.

When a foreign as well as a home market is opened to them, they must receive, as they are now receiving, increased prices for their products. They will find a readier sale, and at better prices, for their wheat, flour, rice, Indian corn, beef, pork, lard, butter, cheese, and other articles which they produce. The home market alone is inadequate to enable them to dispose of the immense surplus of food and other articles which they are capable of producing, even at the most reduced prices, for the manifest reason that they can not be consumed in the country. The United States can from their immense surplus supply not only the home demand, but the deficiencies of food required by the whole world.

That the reduced production of some of the chief articles of food in Great Britain and other parts of Europe may have contributed to increase the demand for our breadstuffs and provisions is not doubted, but that the great and efficient cause of this increased demand and of increased prices consists in the removal of artificial restrictions heretofore imposed is deemed to be equally certain. That our exports of food, already increased and increasing beyond former example under the more liberal policy which has been adopted, will be still vastly enlarged unless they be checked or prevented by a restoration of the protective policy can not be doubted. That our commercial and navigating interests will be enlarged in a corresponding ratio with the increase of our trade is equally certain, while our manufacturing interests will still be the favored interests of the country and receive the incidental protection afforded them by revenue duties; and more than this they can not justly demand.

In my annual message of December last a tariff of revenue duties based upon the principles of the existing law was recommended, and I have seen no reason to change the opinions then expressed. In view of the probable beneficial effects of that law, I recommend that the policy established by it be maintained. It has but just commenced to operate, and to abandon or modify it without giving it a fair trial would be inexpedient and unwise. Should defects in any of its details be ascertained by actual experience to exist, these may be hereafter corrected; but until such defects shall become manifest the act should be fairly tested.

It is submitted for your consideration whether it may not be proper, as a war measure, to impose revenue duties on some of the articles now embraced in the free list. Should it be deemed proper to impose such duties with a view to raise revenue to meet the expenses of the war with Mexico or to avoid to that extent the creation of a public debt, they may be repealed when the emergency which gave rise to them shall cease to exist, and constitute no part of the permanent policy of the country.

The act of the 6th of August last, "to provide for the better organization of the Treasury and for the collection, safe-keeping, transfer, and disbursement of the public revenue," has been carried into execution as rapidly as the delay necessarily arising out of the appointment of new officers, taking and approving their bonds, and preparing and securing proper places for the safe-keeping of the public money would permit. It is not proposed to depart in any respect from the principles or policy on which this great measure is rounded. There are, however, defects in the details of the measure, developed by its practical operation, which are fully set forth in the report of the Secretary of the Treasury, to which the attention of Congress is invited. These defects would impair to some extent the successful operation of the law at all times, but are especially embarrassing when the country is engaged in a war, when the expenditures are greatly increased, when loans are to be effected and the disbursements are to be made at points many hundred miles distant, in some cases, from any depository, and a large portion of them in a foreign country. The modifications suggested in the report of the Secretary of the Treasury are recommended to your favorable consideration.

In connection with this subject I invite your attention to the importance of establishing a branch of the Mint of the United States at New York. Two-thirds of the revenue derived from customs being collected at that point, the demand for specie to pay the duties will be large, and a branch mint where foreign coin and bullion could be immediately converted into American coin would greatly facilitate the transaction of the public business, enlarge the circulation of gold and silver, and be at the same time a safe depository of the public money.

The importance of graduating and reducing the price of such of the public lands as have been long offered in the market at the minimum rate authorized by existing laws, and remain unsold, induces me again to recommend the subject to your favorable consideration. Many millions of acres of these lands have been offered in the market for more than thirty years and larger quantities for more than ten or twenty years, and, being of an inferior quality, they must remain unsalable for an indefinite period unless the price at which they may be purchased shall be reduced. To place a price upon them above their real value is not only to prevent their sale, and thereby deprive the Treasury of any income from that source, but is unjust to the States in which they lie, because it retards their growth and increase of population, and because they have no power to levy a tax upon them as upon other lands within their limits, held by other proprietors than the United States, for the support of their local governments.

The beneficial effects of the graduation principle have been realized by some of the States owning the lands within their limits in which it has been adopted. They have been demonstrated also by the United States acting as the trustee of the Chickasaw tribe of Indians in the sale of their lands lying within the States of Mississippi and Alabama. The Chickasaw lands, which would not command in the market the minimum price established by the laws of the United States for the sale of their lands, were, in pursuance of the treaty of 1834 with that tribe, subsequently offered for sale at graduated and reduced rates for limited periods. The result was that large quantities of these lands were purchased which would otherwise have remained unsold. The lands were disposed of at their real value, and many persons of limited means were enabled to purchase small tracts, upon which they have settled with their families. That similar results would be produced by the adoption of the graduation policy by the United States in all the States in which they are the owners of large bodies of lands which have been long in the market can not be doubted. It can not be a sound policy to withhold large quantities of the public lands from the use and occupation of our citizens by fixing upon them prices which experience has shown they will not command. On the contrary, it is a wise policy to afford facilities to our citizens to become the owners at low and moderate rates of freeholds of their own instead of being the tenants and dependents of others. If it be apprehended that these lands if reduced in price would be secured in large quantities by speculators or capitalists, the sales may be restricted in limited quantities to actual settlers or persons purchasing for purposes of cultivation.

In my last annual message I submitted for the consideration of Congress the present system of managing the mineral lands of the United States, and recommended that they should be brought into market and sold upon such terms and under such restrictions as Congress might prescribe. By the act of the 11th of July last "the reserved lead mines and contiguous lands in the States of Illinois and Arkansas and Territories of Wisconsin and Iowa" were authorized to be sold. The act is confined in its operation to "lead mines and contiguous lands." A large portion of the public lands, containing copper and other ores, is represented to be very valuable, and I recommend that provision be made authorizing the sale of these lands upon such terms and conditions as from their supposed value may in the judgment of Congress be deemed advisable, having due regard to the interests of such of our citizens as may be located upon them.

It will be important during your present session to establish a Territorial government and to extend the jurisdiction and laws of the United States over the Territory of Oregon. Our laws regulating trade and intercourse with the Indian tribes east of the Rocky Mountains should be extended to the Pacific Ocean; and for the purpose of executing them and preserving friendly relations with the Indian tribes within our limits, an additional number of Indian agencies will be required, and should be authorized by law. The establishment of custom-houses and of post-offices and post-roads and provision for the transportation of the mail on such routes as the public convenience will suggest require legislative authority. It will be proper also to establish a surveyor-general's office in that Territory and to make the necessary provision for surveying the public lands and bringing them into market. As our citizens who now reside in that distant region have been subjected to many hardships, privations, and sacrifices in their emigration, and by their improvements have enhanced the value of the public lands in the neighborhood of their settlements, it is recommended that liberal grants be made to them of such portions of these lands as they may occupy, and that similar grants or rights of preemption be made to all who may emigrate thither within a limited period, prescribed by law.

The report of the Secretary of War contains detailed information relative to the several branches of the public service connected with that Department. The operations of the Army have been of a satisfactory and highly gratifying character. I recommend to your early and favorable consideration the measures proposed by the Secretary of War for speedily filling up the rank and file of the Regular Army, for its greater efficiency in the field, and for raising an additional force to serve during the war with Mexico.

Embarrassment is likely to arise for want of legal provision authorizing compensation to be made to the agents employed in the several States and Territories to pay the Revolutionary and other pensioners the amounts allowed them by law. Your attention is invited to the recommendations of the Secretary of War on this subject. These agents incur heavy responsibilities and perform important duties, and no reason exists why they should not be placed on the same footing as to compensation with other disbursing officers.

Our relations with the various Indian tribes continue to be of a pacific character. The unhappy dissensions which have existed among the Cherokees for many years past have been healed. Since my last annual message important treaties have been negotiated with some of the tribes, by which the Indian title to large tracts of valuable land within the limits of the States and Territories has been extinguished and arrangements made for removing them to the country west of the Mississippi. Between 3,000 and 4,000 of different tribes have been removed to the country provided for them by treaty stipulations, and arrangements have been made for others to follow.

In our intercourse with the several tribes particular attention has been given to the important subject of education. The number of schools established among them has been increased, and additional means provided not only for teaching them the rudiments of education, but of instructing them in agriculture and the mechanic arts.

I refer you to the report of the Secretary of the Navy for a satisfactory view of the operations of the Department under his charge during the past year. It is gratifying to perceive that while the war with Mexico has rendered it necessary to employ an unusual number of our armed vessels on her coasts, the protection due to our commerce in other quarters of the world has not proved insufficient. No means will be spared to give efficiency to the naval service in the prosecution of the war; and I am happy to know that the officers and men anxiously desire to devote themselves to the service of their country in any enterprise, however difficult of execution.

I recommend to your favorable consideration the proposition to add to each of our foreign squadrons an efficient sea steamer, and, as especially demanding attention, the establishment at Pensacola of the necessary means of repairing and refitting the vessels of the Navy employed in the Gulf of Mexico.

There are other suggestions in the report which deserve and I doubt not will receive your consideration.

The progress and condition of the mail service for the past year are fully presented in the report of the Postmaster-General. The revenue for the year ending on the 30th of June last amounted to $3,487,199, which is $802,642.45 less than that of the preceding year. The payments for that Department during the same time amounted to $4,084,297.22. Of this sum $597,097.80 have been drawn from the Treasury. The disbursements for the year were $236,434.77 less than those of the preceding year. While the disbursements have been thus diminished, the mail facilities have been enlarged by new mail routes of 5,739 miles, an increase of transportation of 1,764,145 miles, and the establishment of 418 new post-offices. Contractors, postmasters, and others engaged in this branch of the service have performed their duties with energy and faithfulness deserving commendation. For many interesting details connected with the operations of this establishment you are referred to the report of the Postmaster-General, and his suggestions for improving its revenues are recommended to your favorable consideration. I repeat the opinion expressed in my last annual message that the business of this Department should be so regulated that the revenues derived from it should be made to equal the expenditures, and it is believed that this may be done by proper modifications of the present laws, as suggested in the report of the Postmaster-General, without changing the present rates of postage.

With full reliance upon the wisdom and patriotism of your deliberations, it will be my duty, as it will be my anxious desire, to cooperate with you in every constitutional effort to promote the welfare and maintain the honor of our common country.

JAMES K. POLK

***

State of the Union Address James Polk December 7, 1847

Fellow-Citizens of the Senate and of the House of Representatives:

The annual meeting of Congress is always an interesting event. The representatives of the States and of the people come fresh from their constituents to take counsel together for the common good.

After an existence of near three-fourths of a century as a free and independent Republic, the problem no longer remains to be solved whether man is capable of self-government. The success of our admirable system is a conclusive refutation of the theories of those in other countries who maintain that a "favored few" are born to rule and that the mass of mankind must be governed by force. Subject to no arbitrary or hereditary authority, the people are the only sovereigns recognized by our Constitution.

Numerous emigrants, of every lineage and language, attracted by the civil and religious freedom we enjoy and by our happy condition, annually crowd to our shores, and transfer their heart, not less than their allegiance, to the country whose dominion belongs alone to the people. No country has been so much favored, or should acknowledge with deeper reverence the manifestations of the divine protection. An all wise Creator directed and guarded us in our infant struggle for freedom and has constantly watched over our surprising progress until we have become one of the great nations of the earth.

It is in a country thus favored, and under a Government in which the executive and legislative branches hold their authority for limited periods alike from the people, and where all are responsible to their respective constituencies, that it is again my duty to communicate with Congress upon the state of the Union and the present condition of public affairs.

During the past year the most gratifying proofs are presented that our country has been blessed with a widespread and universal prosperity. There has been no period since the Government was founded when all the industrial pursuits of our people have been more successful or when labor in all branches of business has received a fairer or better reward. From our abundance we have been enabled to perform the pleasing duty of furnishing food for the starving millions of less favored countries.

In the enjoyment of the bounties of Providence at home such as have rarely fallen to the lot of any people, it is cause of congratulation that our intercourse with all the powers of the earth except Mexico continues to be of an amicable character.

It has ever been our cherished policy to cultivate peace and good will with all nations, and this policy has been steadily pursued by me. No change has taken place in our relations with Mexico since the adjournment of the last Congress. The war in which the United States were forced to engage with the Government of that country still continues.

I deem it unnecessary, after the full exposition of them contained in my message of the 11th of May, 1846, and in my annual message at the commencement of the session of Congress in December last, to reiterate the serious causes of complaint which we had against Mexico before she commenced hostilities.

It is sufficient on the present occasion to say that the wanton violation of the rights of person and property of our citizens committed by Mexico, her repeated acts of bad faith through a long series of years, and her disregard of solemn treaties stipulating for indemnity to our injured citizens not only constituted ample cause of war on our part, but were of such an aggravated character as would have justified us before the whole world in resorting to this extreme remedy. With an anxious desire to avoid a rupture between the two countries, we forbore for years to assert our clear rights by force, and continued to seek redress for the wrongs we had suffered by amicable negotiation in the hope that Mexico might yield to pacific counsels and the demands of justice. In this hope we were disappointed. Our minister of peace sent to Mexico was insultingly rejected. The Mexican Government refused even to hear the terms of adjustment which he was authorized to propose, and finally, under wholly unjustifiable pretexts, involved the two countries in war by invading the territory of the State of Texas, striking the first blow, and shedding the blood of our citizens on our own soil.

Though the United States were the aggrieved nation, Mexico commenced the war, and we were compelled in self-defense to repel the invader and to vindicate the national honor and interests by prosecuting it with vigor until we could obtain a just and honorable peace. On learning that hostilities had been commenced by Mexico I promptly communicated that fact, accompanied with a succinct statement of our other causes of complaint against Mexico, to Congress, and that body, by the act of the 13th of May, 1846, declared that "by the act of the Republic of Mexico a state of war exists between that Government and the United States." This act declaring "the war to exist by the act of the Republic of Mexico," and making provision for its prosecution "to a speedy and successful termination," was passed with great unanimity by Congress, there being but two negative votes in the Senate and but fourteen in the House of Representatives.

The existence of the war having thus been declared by Congress, it became my duty under the Constitution and the laws to conduct and prosecute it. This duty has been performed, and though at every stage of its progress I have manifested a willingness to terminate it by a just peace, Mexico has refused to accede to any terms which could be accepted by the United States consistently with the national honor and interest.

The rapid and brilliant successes of our arms and the vast extent of the enemy's territory which had been overrun and conquered before the close of the last session of Congress were fully known to that body. Since that time the war has been prosecuted with increased energy, and, I am gratified to state, with a success which commands universal admiration.. History presents no parallel of so many glorious victories achieved by any nation within so short a period. Our Army, regulars and volunteers, have covered themselves with imperishable honors. Whenever and wherever our forces have encountered the enemy, though he was in vastly superior numbers and often intrenched in fortified positions of his own selection and of great strength, he has been defeated. Too much praise can not be bestowed upon our officers and men, regulars and volunteers, for their gallantry, discipline, indomitable courage, and perseverance, all seeking the post of danger and vying with each other in deeds of noble daring.

While every patriot's heart must exult and a just national pride animate every bosom in beholding the high proofs of courage, consummate military skill, steady discipline, and humanity to the vanquished enemy exhibited by our gallant Army, the nation is called to mourn over the loss of many brave officers and soldiers, who have fallen in defense of their country's honor and interests. The brave dead met their melancholy fate in a foreign land, nobly discharging their duty, and with their country's flag waving triumphantly in the face of the foe. Their patriotic deeds are justly appreciated, and will long be remembered by their grateful countrymen. The parental care of the Government they loved and served should be extended to their surviving families.

Shortly after the adjournment of the last session of Congress the gratifying intelligence was received of the signal victory of Buena Vista, and of the fall of the city of Vera Cruz, and with it the strong castle of San Juan de Ulloa, by which it was defended. Believing that after these and other successes so honorable to our arms and so disastrous to Mexico the period was propitious to afford her another opportunity, if she thought proper to embrace it, to enter into negotiations for peace, a commissioner was appointed to proceed to the headquarters of our Army with full powers to enter upon negotiations and to conclude a just and honorable treaty of peace. He was not directed to make any new overtures of peace, but was the bearer of a dispatch from the Secretary of State of the United States to the minister of foreign affairs of Mexico, in reply to one received from the latter of the 22d of February, 1847, in which the Mexican Government was informed of his appointment and of his presence at the headquarters of our Army, and that he was invested with full powers to conclude a definitive treaty of peace whenever the Mexican Government might signify a desire to do so. While I was unwilling to subject the United States to another indignant refusal, I was yet resolved that the evils of the war should not be protracted a day longer than might be rendered absolutely necessary by the Mexican Government.

Care was taken to give no instructions to the commissioner which could in any way interfere with our military operations or relax our energies in the prosecution of the war. He possessed no authority in any manner to control these operations. He was authorized to exhibit his instructions to the general in command of the Army, and in the event of a treaty being concluded and ratified on the part of Mexico he was directed to give him notice of that fact. On the happening of such contingency, and on receiving notice thereof, the general in command was instructed by the Secretary of War to suspend further active military operations until further orders. These instructions were given with a view to intermit hostilities until the treaty thus ratified by Mexico could be transmitted to Washington and receive the action of the Government of the United States. The commissioner was also directed on reaching the Army to deliver to the general in command the dispatch which he bore from the Secretary of State to the minister of foreign affairs of Mexico, and on receiving it the general was instructed by the Secretary of War to cause it to be transmitted to the commander of the Mexican forces, with a quest that it might be communicated to his Government. The commissioner did not reach the headquarters of the Army until after another brilliant victory had crowned our arms at Cerro Gordo. The dispatch which he bore from the Secretary of War to the general in command of the Army was received by that officer, then at Jalapa, on the 7th of May, 1847, together with the dispatch from the Secretary of State to the minister of foreign affairs of Mexico, having been transmitted to him from Vera Cruz. The commissioner arrived at the headquarters of the Army a few days afterwards. His presence with the Army and his diplomatic character were made known to the Mexican Government from Puebla on the 12th of June, 1847, by the transmission of the dispatch from the Secretary of State to the minister of foreign affairs of Mexico.

Many weeks elapsed after its receipt, and no overtures were made nor was any desire expressed by the Mexican Government to enter into negotiations for peace.

Our Army pursued its march upon the capital, and as it approached it was met by formidable resistance. Our forces first encountered the enemy, and achieved signal victories in the severely contested battles of Contreras and Churubusco. It was not until after these actions had resulted in decisive victories and the capital of the enemy was within our power that the Mexican Government manifested any disposition to enter into negotiations for peace, and even then, as events have proved, there is too much reason to believe they were insincere, and that in agreeing to go through the forms of negotiation the object was to gain time to strengthen the defenses of their capital and to prepare for fresh resistance.

The general in command of the Army deemed it expedient to suspend hostilities temporarily by entering into an armistice with a view to the opening of negotiations. Commissioners were appointed on the part of Mexico to meet the commissioner on the part of the United States. The result of the conferences which took place between these functionaries of the two Governments was a failure to conclude a treaty of peace. The commissioner of the United States took with him the project of a treaty already prepared, by the terms of which the indemnity required by the United States was a cession of territory.

It is well known that the only indemnity which it is in the power of Mexico to make in satisfaction of the just and long-deferred claims of our citizens against her and the only means by which she can reimburse the United States for the expenses of the war is a cession to the United States of a portion of her territory. Mexico has no money to pay, and no other means of making the required indemnity. If we refuse this, we can obtain nothing else. To reject indemnity by refusing to accept a cession of territory would be to abandon all our just demands, and to wage the war, bearing all its expenses, without a purpose or definite object.

A state of war abrogates treaties previously existing between the belligerents and a treaty of peace puts an end to all claims for indemnity for tortious acts committed under the authority of one government against the citizens or subjects of another unless they are provided for in its stipulations. A treaty of peace which would terminate the existing war without providing for indemnity would enable Mexico, the acknowledged debtor and herself the aggressor in the war, to relieve herself from her just liabilities. By such a treaty our citizens who hold just demands against her would have no remedy either against Mexico or their own Government. Our duty to these citizens must forever prevent such a peace, and no treaty which does not provide ample means of discharging these demands can receive my sanction.

A treaty of peace should settle all existing differences between the two countries. If an adequate cession of territory should be made by such a treaty, the United States should release Mexico from all her liabilities and assume their payment to our own citizens. If instead of this the United States were to consent to a treaty by which Mexico should again engage to pay the heavy amount of indebtedness which a just indemnity to our Government and our citizens would impose on her, it is notorious that she does not possess the means to meet such an undertaking. From such a treaty no result could be anticipated but the same irritating disappointments which have heretofore attended the violations of similar treaty stipulations on the part of Mexico. Such a treaty would be but a temporary cessation of hostilities, without the restoration of the friendship and good understanding which should characterize the future intercourse between the two countries.

That Congress contemplated the acquisition of territorial indemnity when that body made provision for the prosecution of the war is obvious. Congress could not have meant when, in May, 1846, they appropriated $10,000,000 and authorized the President to employ the militia and naval and military forces of the United States and to accept the services of 50,000 volunteers to enable him to prosecute the war, and when, at their last session, and after our Army had invaded Mexico, they made additional appropriations and authorized the raising of additional troops for the same purpose, that no indemnity was to be obtained from Mexico at the conclusion of the war; and yet it was certain that if no Mexican territory was acquired no indemnity could be obtained. It is further manifest that Congress contemplated territorial indemnity from the fact that at their last session an act was passed, upon the Executive recommendation, appropriating $3,000,000 with that express object. This appropriation was made "to enable the President to conclude a treaty of peace, limits, and boundaries with the Republic of Mexico, to be used by him in the event that said treaty, when signed by the authorized agents of the two Governments and duly ratified by Mexico, shall call for the expenditure of the same or any part thereof." The object of asking this appropriation was distinctly stated in the several messages on the subject which I communicated to Congress. Similar appropriations made in 1803 and 1806, which were referred to, were intended to be applied in part consideration for the cession of Louisiana and the Floridas. In like manner it was anticipated that in settling the terms of a treaty of "limits and boundaries" with Mexico a cession of territory estimated to be of greater value than the amount of our demands against her might be obtained, and that the prompt payment of this sum in part consideration for the territory ceded, on the conclusion of a treaty and its ratification on her part, might be an inducement with her to make such a cession of territory as would be satisfactory to the United States; and although the failure to conclude such a treaty has rendered it unnecessary to use any part of the $3,000,000 appropriated by that act, and the entire sum remains in the Treasury, it is still applicable to that object should the contingency occur making such application proper.

The doctrine of no territory is the doctrine of no indemnity, and if sanctioned would be a public acknowledgment that our country was wrong and that the war declared by Congress with extraordinary unanimity was unjust and should be abandoned—an admission unfounded in fact and degrading to the national character.

The terms of the treaty proposed by the United States were not only just to Mexico, but, considering the character and amount of our claims, the unjustifiable and unprovoked commencement of hostilities by her, the expenses of the war to which we have been subjected, and the success which had attended our arms, were deemed to be of a most liberal character.

The commissioner of the United States was authorized to agree to the establishment of the Rio Grande as the boundary from its entrance into the Gulf to its intersection with the southern boundary of New Mexico, in north latitude about 32 degree, and to obtain a cession to the United States of the Provinces of New Mexico and the Californias and the privilege of the right of way across the Isthmus of Tehuantepec. The boundary of the Rio Grande and the cession to the United States of New Mexico and Upper California constituted an ultimatum which our commissioner was under no circumstances to yield.

That it might be manifest, not only to Mexico, but to all other nations, that the United States were not disposed to take advantage of a feeble power by insisting upon wrestling from her all the other Provinces, including many of her principal towns and cities, which we had conquered and held in our military occupation but were willing to conclude a treaty in a spirit of liberality, our commissioner was authorized to stipulate for the restoration to Mexico of all our other conquests.

As the territory to be acquired by the boundary proposed might be estimated to be of greater value than a fair equivalent for our just demands, our commissioner was authorized to stipulate for the payment of such additional pecuniary consideration as was deemed reasonable.

The terms of a treaty proposed by the Mexican commissioners were wholly inadmissible. They negotiated as if Mexico were the victorious, and not the vanquished, party. They must have known that their ultimatum could never be accepted. It required the United States to dismember Texas by surrendering to Mexico that part of the territory of that State lying between the Nueces and the Rio Grande, included within her limits by her laws when she was an independent republic, and when she was annexed to the United States and admitted by Congress as one of the States of our Union. It contained no provision for the payment by Mexico of the just claims of our citizens. It required indemnity to Mexican citizens for injuries they may have sustained by our troops in the prosecution of the war. It demanded the right for Mexico to levy and collect the Mexican tariff of duties on goods imported into her ports while in our military occupation during the war, and the owners of which had paid to officers of the United States the military contributions which had been levied upon them; and it offered to cede to the United States, for a pecuniary consideration, that part of Upper California lying north of latitude 37 . Such were the unreasonable terms proposed by the Mexican commissioners.

The cession to the United States by Mexico of the Provinces of New Mexico and the Californias, as proposed by the commissioner of the United States, it was believed would be more in accordance with the convenience and interests of both nations than any other cession of territory which it was probable Mexico could be induced to make.

It is manifest to all who have observed the actual condition of the Mexican Government for some years past and at present that if these Provinces should be retained by her she could not long continue to hold and govern them. Mexico is too feeble a power to govern these Provinces, lying as they do at a distance of more than 1,000 miles from her capital, and if attempted to be retained by her they would constitute but for a short time even nominally a part of her dominions. This would be especially the case with Upper California.

The sagacity of powerful European nations has long since directed their attention to the commercial importance of that Province, and there can be little doubt that the moment the United States shall relinquish their present occupation of it and their claim to it as indemnity an effort would be made by some foreign power to possess it, either by conquest or by purchase. If no foreign government should acquire it in either of these modes, an independent revolutionary government would probably be established by the inhabitants and such foreigners as may remain in or remove to the country as soon as it shall be known that the United States have abandoned it. Such a government would be too feeble long to maintain its separate independent existence, and would finally become annexed to or be a dependent colony of some more powerful state. Should any foreign government attempt to possess it as a colony, or otherwise to incorporate it with itself, the principle avowed by President Monroe in 1824, and reaffirmed in my first annual message, that no foreign power shall with our consent be permitted to plant or establish any new colony or dominion on any part of the North American continent must be maintained. In maintaining this principle and in resisting its invasion by any foreign power we might be involved in other wars more expensive and more difficult than that in which we are now engaged. The Provinces of New Mexico and the Californias are contiguous to the territories of the United States, and if brought under the government of our laws their resources—mineral, agricultural, manufacturing, and commercial—would soon be developed.

Upper California is bounded on the north by our Oregon possessions, and if held by the United States would soon be settled by a hardy, enterprising, and intelligent portion of our population. The Bay of San Francisco and other harbors along the Californian coast would afford shelter for our Navy, for our numerous whale ships, and other merchant vessels employed in the Pacific Ocean, and would in a short period become the marts of an extensive and profitable commerce with China and other countries of the East.

These advantages, in which the whole commercial world would participate, would at once be secured to the United States by the cession of this territory; while it is certain that as long as it remains a part of the Mexican dominions they can be enjoyed neither by Mexico herself nor by any other nation.

New Mexico is a frontier Province, and has never been of any considerable value to Mexico. From its locality it is naturally connected with our Western settlements. The territorial limits of the State of Texas, too, as defined by her laws before her admission into our Union, embrace all that portion of New Mexico lying east of the Rio Grande, while Mexico still claims to hold this territory as a part of her dominions. The adjustment of this question of boundary is important.

There is another consideration which induced the belief that the Mexican Government might even desire to place this Province under the protection of the Government of the United States. Numerous bands of fierce and warlike savages wander over it and upon its borders. Mexico has been and must continue to be too feeble to restrain them from committing depredations, robberies, and murders, not only upon the inhabitants of New Mexico itself, but upon those of the other northern States of Mexico. It would be a blessing to all these northern States to have their citizens protected against them by the power of the United States. At this moment many Mexicans, principally females and children, are in captivity among them. If New Mexico were held and governed by the United States, we could effectually prevent these tribes from committing such outrages, and compel them to release these captives and restore them to their families and friends.

In proposing to acquire New Mexico and the Californias, it was known that but an inconsiderable portion of the Mexican people would be transferred with them, the country embraced within these Provinces being chiefly an uninhabited region.

These were the leading considerations which induced me to authorize the terms of peace which were proposed to Mexico. They were rejected, and, negotiations being at an end, hostilities were renewed. An assault was made by our gallant Army upon the strongly fortified places near the gates of the City of Mexico and upon the city itself, and after several days of severe conflict the Mexican forces, vastly superior in number to our own, were driven from the city, and it was occupied by our troops.

Immediately after information was received of the unfavorable result of the negotiations, believing that his continued presence with the Army could be productive of no good, I determined to recall our commissioner. A dispatch to this effect was transmitted to him on the 6th of October last. The Mexican Government will be informed of his recall, and that in the existing state of things I shall not deem it proper to make any further overtures of peace, but shall be at all times ready to receive and consider any proposals which may be made by Mexico.

Since the liberal proposition of the United States was authorized to be made, in April last, large expenditures have been incurred and the precious blood of many of our patriotic fellow-citizens has been shed in the prosecution of the war. This consideration and the obstinate perseverance of Mexico in protracting the war must influence the terms of peace which it may be deemed proper hereafter to accept. Our arms having been everywhere victorious, having subjected to our military occupation a large portion of the enemy's country, including his capital, and negotiations for peace having failed, the important questions arise, in what manner the war ought to be prosecuted and what should be our future policy. I can not doubt that we should secure and render available the conquests which we have already made, and that with this view we should hold and occupy by our naval and military forces all the ports, towns, cities, and Provinces now in our occupation or which may hereafter fall into our possession; that we should press forward our military operations and levy such military contributions on the enemy as may, as far as practicable, defray the future expenses of the war.

Had the Government of Mexico acceded to the equitable and liberal terms proposed, that mode of adjustment would have been preferred, Mexico having declined to do this and failed to offer any other terms which could be accepted by the United States, the national honor, no less than the public interests, requires that the war should be prosecuted with increased energy and power until a just and satisfactory peace can be obtained. In the meantime, as Mexico refuses all indemnity, we should adopt measures to indemnify ourselves by appropriating permanently a portion of her territory. Early after the commencement of the war New Mexico and the Californias were taken possession of by our forces. Our military and naval commanders were ordered to conquer and hold them, subject to be disposed of by a treaty of peace.

These Provinces are now in our undisputed occupation, and have been so for many months, all resistance on the part of Mexico having ceased within their limits. I am satisfied that they should never be surrendered to Mexico. Should Congress concur with me in this opinion, and that they should be retained by the United States as indemnity, I can perceive no good reason why the civil jurisdiction and laws of the United States should not at once be extended over them. To wait for a treaty of peace such as we are willing to make, by which our relations toward them would not be changed, can not be good policy; whilst our own interest and that of the people inhabiting them require that a stable, responsible, and free government under our authority should as soon as possible be established over them. Should Congress, therefore, determine to hold these Provinces permanently, and that they shall hereafter be considered as constituent parts of our country, the early establishment of Territorial governments over them will be important for the more perfect protection of persons and property; and I recommend that such Territorial governments be established. It will promote peace and tranquillity among the inhabitants, by allaying all apprehension that they may still entertain of being again subjected to the jurisdiction of Mexico. I invite the early and favorable consideration of Congress to this important subject.

Besides New Mexico and the Californias, there are other Mexican Provinces which have been reduced to our possession by conquest. These other Mexican Provinces are now governed by our military and naval commanders under the general authority which is conferred upon a conqueror by the laws of war. They should continue to be held, as a means of coercing Mexico to accede to just terms of peace. Civil as well as military officers are required to conduct such a government. Adequate compensation, to be drawn from contributions levied on the enemy, should be fixed by law for such officers as may be thus employed. What further provision may become necessary and what final disposition it may be proper to make of them must depend on the future progress of the war and the course which Mexico may think proper hereafter to pursue.

With the views I entertain I can not favor the policy which has been suggested, either to withdraw our Army altogether or to retire to a designated line and simply hold and defend it. To withdraw our Army altogether from the conquests they have made by deeds of unparalleled bravery, and at the expense of so much blood and treasure, in a just war on our part, and one which, by the act of the enemy, we could not honorably have avoided, would be to degrade the nation in its own estimation and in that of the world. To retire to a line and simply hold and defend it would not terminate the war. On the contrary, it would encourage Mexico to persevere and tend to protract it indefinitely. It is not to be expected that Mexico, after refusing to establish such a line as a permanent boundary when our victorious Army are in possession of her capital and in the heart of her country, would permit us to hold it without resistance. That she would continue the war, and in the most harassing and annoying forms, there can be no doubt. A border warfare of the most savage character, extending over a long line, would be unceasingly waged. It would require a large army to be kept constantly in the field, stationed at posts and garrisons along such a line, to protect and defend it. The enemy, relieved from the pressure of our arms on his coasts and in the populous parts of the interior, would direct his attention to this line, and, selecting an isolated post for attack, would concentrate his forces upon it. This would be a condition of affairs which the Mexicans, pursuing their favorite system of guerrilla warfare, would probably prefer to any other. Were we to assume a defensive attitude on such a line, all the advantages of such a state of war would be on the side of the enemy. We could levy no contributions upon him, or in any other way make him feel the pressure of the war, but must remain inactive and await his approach, being in constant uncertainty at what point on the line or at what time he might make an assault. He may assemble and organize an overwhelming force in the interior on his own side of the line, and, concealing his purpose, make a sudden assault upon some one of our posts so distant from any other as to prevent the possibility of timely succor or reenforcements, and in this way our gallant Army would be exposed to the danger of being cut off in detail; or if by their unequaled bravery and prowess everywhere exhibited during this war they should repulse the enemy, their numbers stationed at any one post may be too small to pursue him. If the enemy be repulsed in one attack, he would have nothing to do but to retreat to his own side of the line, and, being in no fear of a pursuing army, may reenforce himself at leisure for another attack on the same or some other post. He may, too, cross the line between our posts, make rapid incursions into the country which we hold, murder the inhabitants, commit depredations on them, and then retreat to the interior before a sufficient force can be concentrated to pursue him. Such would probably be the harassing character of a mere defensive war on our part. If our forces when attacked, or threatened with attack, be permitted to cross the line, drive back the enemy, and conquer him, this would be again to invade the enemy's country after having lost all the advantages of the conquests we have already made by having voluntarily abandoned them. To hold such a line successfully and in security it is far from being certain that it would not require as large an army as would be necessary to hold all the conquests we have already made and to continue the prosecution of the war in the heart of the enemy's country. It is also far from being certain that the expenses of the war would be diminished by such a policy. I am persuaded that the best means of vindicating the national honor and interest and of bringing the war to an honorable close will be to prosecute it with increased energy and power in the vital parts of the enemy's country.