annexation to the United States; and the Executive saw, in the acquisition of such a territory, the means of advancing their permanent happiness and glory. What principle of good faith, then, was violated? what rule of political morals trampled under foot? So far as Mexico herself was concerned, the measure should have been regarded by her as highly beneficial. Her inability to reconquer Texas had been exhibited, I repeat, by eight (now nine) years of fruitless and ruinous contest. In the mean time, Texas has been growing in population and resources. Emigration has flowed into her territory from all parts of the world, in a current which continues to increase in strength. Mexico requires a permanent boundary between that young republic and herself. Texas, at no distant day, if she continues separate and detached from the United States, will inevitably seek to consolidate her strength by adding to her domain the contiguous provinces of Mexico. The spirit of revolt from the control of the central government has, heretofore, manifested itself in some of those provinces; and it is fair to infer that they would be inclined to take the first favorable opportunity to proclaim their independence, and to form close alliances with Texas. The war would thus be endless; or, if cessations of hostilities should occur, they would only endure for a sea

The interests of Mexico, therefore, could in nothing be better consulted than in a peace with her neighbors, which would result in the establishment of a permanent boundary. Upon the ratification of the treaty, the Executive was prepared to treat with her on the most liberal basis. Hence the boundaries of Texas were left undefined by the treaty. The Executive proposed to settle these upon terms that all the world should have pronounced just and reasonable. No negotiation upon that point could have been undertaken between the United States and Mexico, in advance of the ratification of the treaty. We should have had no right, no power, no authority to have conducted such a negotiation; and to have undertaken it, would have been an assumption equally revolting to the pride of Mexico and Texas, and subjecting us to the charge of arrogance: while to have proposed, in advance of annexation, to satisfy Mexico for any contingent interest she might have in Texas, would have been to have treated Texas, not as an independent power, but as a mere dependency of Mexico. This assumption could not have been acted on by the Executive, without setting at defiance your own solemn declaration that that republic was an independent state. Mexico had, it is true, threatened war against the United States, in the event the treaty of annexation was ratified. The Executive could not permit itself to be influenced by this threat. It represented, in this, the spirit of our people, who are ready to sacrifice much for peace, but nothing to intimidation. A war, under any circumstances, is greatly to be deplored, and the United States is the last nation to desire it; but if, as the condition of peace, it be required of us to forego the unquestionable right of treating with an independent power of our own continent, upon matters highly interesting to both, and that upon a naked and unsustained pretension of claim by a third power, to control the free will of the power with whom we treat,→ devoted as we may be to peace, and anxious to cultivate friendly relations with the whole world, the Executive does not hesitate to say that the people of the United States would be ready to brave all consequences sooner than submit to such condition. But no apprehension of war was entertained by the Executive; and I must express frankly the opinion,

that, had the treaty been ratified by the Senate, it would have been followed by a prompt settlement, to the entire satisfaction of Mexico, of every matter in difference between the two countries. Seeing, then, that new preparations for hostile invasion of Texas were about to be adopted by Mexico, and that these were brought about because Texas had adopted the suggestions of the Executive upon the subject of annexation, it could not passively have folded its arms and permitted a war, threatened to be accompanied by every act that could mark a barbarous age, to be waged against her, because she had done so.

Other considerations of a controlling character influenced the course of the Executive. The treaty which had thus been negotiated, had failed to receive the ratification of the Senate. One of the chief objections which were urged against it, was found to consist in the fact that the question of annexation had not been submitted to the ordeal of public opinion in the United States. However untenable such an objection was esteemed to be, in view of the unquestionable power of the Executive to negotiate the treaty, and the great and lasting interests involved in the question, I felt it to be my duty to submit the whole subject to Congress, as the best expounders of popular sentiment. No definitive action having been taken on the subject by Congress, the question referred itself directly to the decision of the States and the people. The great popular election which has just terminated, afforded the best opportunity of ascertaining the will of the States and the people upon it. Pending that issue, it became the imperative duty of the Executive to inform Mexico that the question of annexation was still before the American people, and that, until their decision was pronounced, any serious invasion of Texas would be regarded as an attempt to forestall their judgment, and could not be looked upon with indifference. I am most happy to inform you that no such invasion has taken place; and I trust that, whatever your action may be upon it, Mexico will see the importance of deciding the matter by a resort to peaceful expedients, in preference to those of arms. The decision of the people and the States on this great and interesting subject has been decisively manifested. The question of annexation has been presented nakedly to their consideration. By the treaty itself, all collateral and incidental issues, which were calculated to divide and distract the public councils, were carefully avoided. These were left to the wisdom of the future to determine. It presented, I repeat, the isolated question of annexation; and in that form it has been submitted to the ordeal of public sentiment. A controlling majority of the people, and a large majority of the States, have declared in favor of immediate annexation. Instructions have thus come up to both branches of Congress, from their respective constituents, in terms the most emphatic. It is the will of both the people and the States that Texas shall be annexed to the Union promptly and immediately. It may be hoped that, in carrying into execution the public will, thus declared, all collateral issues may be avoided. Future legislatures can best decide as to the number of States which should be formed out of the territory, when the time has arrived for deciding that question. So with all others. By the treaty, the United States assumed the payment of the debts of Texas, to an amount not exceeding $10,000,000, to be paid (with the exception of a sum falling short of $400,000) exclusively out of the proceeds of the sales of her public

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lands. We could not, with honor, take the lands, without assuming the full payment of all incumbrances upon them.

Nothing has occurred, since your last session, to induce a doubt that the dispositions of Texas remain unaltered. No intimation of an altered determination, on the part of her government and people, has been furnished to the Executive. She still desires to throw herself under the protection of our laws, and to partake of the blessings of our federative system; while every Ainerican interest would seem to require it. The extension of our coastwise and foreign trade, to an amount almost incalculable the enlargement of the market for our manufactures-a constantly growing market for our agricultural productions-safety to our frontiers, and additional strength and stability to the Union,-these are the results which would rapidly develop themselves upon the consummation of the measure of annexation. In such event, I will not doubt but that Mexico would find her true interest to consist in meeting the advances of this government in a spirit of amity.

Nor do I apprehend any serious complaint from any other quarter; no sufficient ground exists for such complaint. We should interfere in no respect with the rights of any other nation. There cannot be gathered from the act any design, on our part, to do so with their possessions on this continent. We have interposed no impediments in the way of such acquisitions of territory (large and extensive as many of them are) as the leading powers of Europe have made, from time to time, in every part of the world. We seek no conquest made by war. No intrigue will have been resorted to, or acts of diplomacy essayed, to accomplish the annexation of Texas. Free and independent herself, she asks to be received into our Union. It is a question for our own decision, whether she shall be received or not.

The two governments having already agreed, through their respective organs, on the terms of annexation, I would recommend their adoption by Congress in the form of a joint resolution, or act, to be perfected and made binding on the two countries when adopted, in like manner, by the gov ernment of Texas.

In order that the subject may be fully presented in all its bearings, the correspondence which has taken place in reference to it, since the adjournment of Congress, between the United States, Texas, and Mexico, is herewith transmitted.

The amendments proposed by the Senate to the convention concluded between the United States and Mexico on the 20th of November, 1843, have been transmitted, through our minister, for the concurrence of the Mexican government; but, although urged thereto, no action has yet been had on the subject; nor has any answer been given which would authorize a favorable conclusion in the future.

The decree of September, 1843, in relation to the retail trade, the order for the expulsion of foreigners, and that of a more recent date in regard to passports-all of which are considered as in violation of the treaty of amity and commerce between the two countries-have led to a correspondence of considerable length between the minister for foreign relations and our representative at Mexico, but without any satisfactory result. They remain still unadjusted; and many and serious inconveniences have already resulted to our citizens in consequence of them.

Questions growing out of the act of disarming a body of Texan troops,

under the command of Major Snively, by an officer in the service of the United States, acting under the orders of our government, and the forcible entry into the custom-house at Bryarly's landing, on Red river, by certain citizens of the United States, and taking away therefrom the goods seized by the collector of the customs, as forfeited under the laws of Texas, have been adjusted, so far as the powers of the Executive extend. The correspondence between the two governments, in reference to both subjects, will be found amongst the accompanying documents. It contains a full statement of all the facts and circumstances, with the views taken on both sides, and the principles on which the questions have been adjusted. It remains for Congress to make the necessary appropriation to carry the arrangement into effect, which I respectfully recommend.

The greatly improved condition of the treasury affords a subject for general congratulation. The paralysis which had fallen on trade and commerce, and which subjected the government to the necessity of resorting to loans, and the issue of treasury notes to a large amount, has passed away; and after the payment of upwards of $7,000,000 on account of the interest, and in redemption of more than $5,000,000 of the public debt, which falls due on the 1st of January next, and setting apart upwards of $2,000,000 for the payment of outstanding treasury notes, and meeting an instalment of the debts of the corporate cities of the District of Columbia, an estimated surplus of upwards of $7,000,000, over and above the existing appropriations, will remain in the treasury at the close of the fiscal year. Should the treasury notes continue outstanding, as heretofore, that surplus will be considerably augmented. Although all interest has ceased upon them, and the government has invited their return to the treasury, yet they remain outstanding; affording great facilities to commerce, and establishing the fact, that, under a well regulated system of finance, the government has resources within itself which render it independent, in time of need, not only of private loans, but also of bank facilities.

The only remaining subject of regret is, that the remaining stocks of the government do not fall due at an earlier day; since their redemption would be entirely within its control. As it is, it may be well worthy the consideration of Congress, whether the law establishing the sinking fund (under the operation of which the debts of the revolution and the last war with Great Britain were, to a great extent, extinguished) should not, with proper modifications, so as to prevent an accumulation of surpluses, and limited in amount to a specific sum, be re-enacted. Such provision, which would authorize the government to go into the market for a purchase of its own stock on fair terms, would serve to maintain its credit at the highest point, and prevent, to a great extent, those fluctuations in the price of its securities, which might, under circumstances, affect its credit. No apprehension of this sort is, at this moment, entertained; since the stocks of the government which, but two years ago, were offered for sale to capitalists at home and abroad, at a depreciation, and could find no purchasers, are now greatly above par in the hands of the holders; but a wise and prudent forecast admonishes us to place beyond the reach of contingency the public credit.

It must also be a matter of unmingled gratification, that, under the existing financial system, (resting upon the act of 1759, and the resolu tion of 1816,) the currency of the country has attained a state of perfect

soundness; and the rates of exchange between different parts of the Union, which, in 1841, denoted, by their enormous amount, the great depreciation, and, in fact, worthlessness of the currency in most of the States, are now reduced to little more than the mere expense of transporting specie from place to place, and the risk incidental to the operation. In a new country like that of the United States, where so many inducements are held out for speculation, the depositories of the surplus revenue, consisting of banks of any description, when it reaches any considerable amount, require the closest vigilance on the part of the government. All banking institutions, under whatever denomination they may pass, are governed by an almost exclusive regard to the interest of the stockholders. That interest consists in the augmentation of profits, in the form of dividends; and a large surplus revenue intrusted to their custody, is but too apt to lead to excessive loans, and to extravagantly large issues of paper. As a necessary consequence, prices are nominally increased, and the speculative mania very soon seizes upon the public mind. A fictitious state of prosperity for a season exists, and, in the language of the day, money becomes plenty. Contracts are entered into by individuals, resting on this unsubstantial state of things; but the delusion speedily passes away, and the country is overrun with an indebtedness so weighty as to overwhelm many, and to visit every department of industry with great and ruinous embarrassment. The greatest vigilance becomes necessary on the part of the government to guard against this state of things. The depositories must be given distinctly to understand that the favors of the government will be altogether withdrawn, or substantially diminished, if its revenues shall be regarded as additions to their banking capitil, or as the foundation of an enlarged circulation. The government, through its revenue, has at all times an important part to perform in connexion with the currency; and it greatly depends upon its vigilance and care whether the country be involved in embarrassments similar to those which it has had recently to encounter, or, aided by the action of the treasury, shall be preserved in a sound and healthy condition.

The dangers to be guarded against are greatly augmented by too large a surplus of revenue. When that surplus greatly exceeds in amount what shall be required by a wise and prudent forecast to meet unforeseen contingencies, the legislature itself may come to be seized with a disposi tion to indulge in extravagant appropriations to objects, many of which may, and most probably would, be found to conflict with the constitution. A fancied expediency is elevated above constitutional authority; and a reckless and wasteful extravagance but too certainly follows. The important power of taxation, which, when exercised in its most restricted forin, is a burden on labor and production, is resorted to, under various pretexts, for purposes having no affinity to the motives which dictated its grant; and the extravagance of government stimulates individual extravagance, until the spirit of a wild and ill regulated speculation involves one and all in its unfortunate results. In view of such fatal consequences, it may be laid down as an axiom, founded in moral and political truth,—that no greater taxes should be imposed than are necessary for an economical administration of the government; and that whatever exists beyond, should be reduced or modified. This doctrine does in no way conflict with the exercise of a sound discrimination in the selection of the articles to be taxed, which a due regard to the public weal would at all times sug