Additional agencies are required to manage Indian affairs in these territories, and to extend to them our Indian system of control and management.

The secretary asks attention to the following subjects; the settlement of claims in California, a retired list of officers of the army, and an asylum for disabled and wounded soldiers.

REPORT OF THE SECRETARY OF THE TREASURY.

The total resources of the year, including a balance of $1,701,251 on hand at its commencement, were $58,394,701:-the total expenses $58,241,167,— showing a balance in the Treasury of $153,534. At the close of next year it is estimated that there will be on hand a balance of $2,853,694:—in 1850, it is put at $5,040,542.

The secretary states the annual average revenue under the tariff of 1842 at $23,895,208: that under the tariff of 1846 at $30,902,489. He then proceeds to point out the bad consequences that would have followed the continuance of the tariff of 1842, and the distribution of the proceeds of the sales of the public lands. The result of protection, he urges, would have been the destruction of commerce, the great importance of which he then sets forth. Specific duties, moreover, he says, constantly increase, as the foreign article falls in price,-which proposition he illustrates at length. Our manufacturers, he says, do not desire the restoration of the tariff of '42, because it stimulated too much competition.

Our exports of breadstuffs during the year amounted to $37,472,751-double the amount exported under the tariff of '42. Our tonnage also increased from 2,839,046 to 3,150,502 tons. The most of this increase is attributed to the present tariff. A re-enactment of the tariff of '42 will increase smuggling, —great advantages for which exist along our coast, as is shown by elaborate tables.

Mr. Walker refers to the revulsions of Europe, which have injured our trade, and then enters upon an elaborate vindication of Free-Trade principles, in opposition to those of protection,-enforced by the example of the several States of the Union, among which free-trade prevails. A large section of the report is occupied with this argument, which is skilfully handled. The repeal of the British Corn Laws is attributed to our arguments. The protective system is characterized as "agrarian," and a war upon property.

A cutter has been sent to Oregon to enforce the revenue laws there. No duties can be collected in California as yet. It is recommended that other collection districts on the Pacific Coast be authorized. Reference is made to the facilities for commerce in the Pacific,-to the propriety of sending steamers there, and to the great desirableness of a railroad across the isthmus of Darien.

The Secretary recommends that an act be passed allowing goods to be taken across the Isthmus to our Pacific ports, the same as from one port to another on the Atlantic coast.

Consuls are needed at Chagres and Panama.

Drawback should be allowed on goods exported by the Rio Grande.

A variety of suggestions in regard to our trade in our new possessions are submitted. Reciprocal free trade between Canada and Mexico and the United States is recommended.

The Mexican Tariff imposed upon Mexico during the war greatly increased our means, and set a salutary example to belligerents in future wars.

The Secretary strongly renews his recommendation for a branch mint in the city of New York. It is urged as necessary, in order to secure to the city the command of her due proportion of coin. The storehouse of the goods of the Union, he says, must become the storehouse of its specie.

The department, since March, 1845, has coined at our mints the sum of $38,717,709. Much more would have been coined, had there been a branch mint at New York. The branch mint would also greatly aid the operations of the assistant treasurer.

The merchants of New York, from January 1, 1847, to November 30, 1848, paid $35,360,678 for duties. The amount of specie received during the same period by the assistant treasurer at New York was $57,328,369, and the coin disbursed $55,496,269.

The sub-treasury system is vindicated as against the State bank deposit system.

The transactions in regard to the loan of $16,000,000 in March last, are detailed. The whole prémium obtained was $487,168.

The public debt has been punctually paid whenever it became due. Statements are made showing that this has been done at every period of our his

tory.

Our present debt is about $65,304,450,-less than half the annual interest on the public debt of Great Britain.

Our whole public domain unsold amounts to 1,442,217,837.

The Secretary advises that power be given the department to purchase all the public debt exclusive of Treasury notes without premium, and also to purchase at the market rate any portion of the rest of the debt. Details are given of the purchase already made. Reasons are given why the debt should be discharged as rapidly as possible.

The Coast survey is making rapid progress.-Six new sections of coast have been surveyed, and six new shoals discovered.

Improvements in our Light House system are urgently recommended. New standards for weights and measures, and the adoption of the decimal system are urged.

A scientific commission is asked to survey the mineral lands of California. The warehousing system is reserved for a special report. Its progress has been successful and satisfactory.

The Secretary makes some suggestions concerning the organization of the Treasury Department, the separation from it of the Land Office, supervision of the Marshals, and the appointment of an Assistant Secretary. He advises also the detachment of the Indian Office and the Pension Office from the War Department; and that of the Patent Office from the State Department; and the organization of them all under a new head, to be called the Secretary of the Interior. The whole expense would not exceed $20,000 per annum. The report closes with invoking the blessing of Heaven upon our beloved Union.

REPORT OF THE SECRETARY OF THE NAVY.

The construction of the four steamships of war authorized by the act of congress of 3d of March, 1847, is in a satisfactory state of progress. The Saranac, built at the navy yard at Kittery, has been launched. The Powhatan, at Norfolk; the Susquehanna, at Philadelphia; and the San Jacinto, at New York, may be launched and ready for sea in the course of the next year.

There are unfinished on the stocks at the several navy yards four ships of the rate of seventy-four guns, and two frigates of forty-four guns. They are so near completion that they can be readily launched and fitted for sea service on short notice, if public exigencies shall require it. The vessels in commission during the past year have been employed as follows:

With a view to the general convenience, one of the three store-ships at

tached to the Pacific squadron sails on her return to the United States semiannually.

The report enlarges, with justness and propriety, upon the value and services rendered by the navy in the war with Mexico; presenting the fact that although the enemy could not be encountered upon the water, yet the operations of the army were facilitated and derived much of their success from the presence of the navy upon the Mexican coasts. Reference is properly made to the aid afforded the Yucatanese by the American squadron in the Gulf; being, in fact, aid to a portion of the people of a country with which

we were at war.

It is remarked that not a single American vessel was lost to her owners by capture by the enemy under the rights of war; and there was not, it is believed, any material effect produced on marine insurance.

Upon the subject of promotions the report remarks, that the safest and best mode is to require by law that officers rendered unfit for duty otherwise than by wounds received in battle, or not qualified for promotion to higher grades, should be placed on reduced pay, out of the line of promotion. Justice and policy would require that great care should be taken against the exercise of such a power capriciously, or without a due regard to the rights of all.

The advantages of such a system in guarding officers against contracting disqualifying habits-in stimulating them to the active and zealous perform ance of duty-in exciting them to the acquisition of professional knowledge, and in securing to the meritorious the rewards of promotion, without having the way blocked up by others inferior and incompetent, would speedily develop themselves. Such a measure would reduce the expense of the navy; because, under existing laws, officers who do not perform duty, and are incapable of it, are in the receipt of the full pay of the rank.

Another great security for efficiency in the navy will be found in the education, and in affording the means of instruction to the officers.

The beneficial effects of the naval school at Annapolis upon the service are already beginning to be sensibly felt.

A necessary appendage to the institution is a vessel of the navy, fitted as a school of practice in gunnery and navigation. I earnestly recommend that the appropriation for the next fiscal year, for which an estimate has been submitted, may be made; and as no appropriation was made for the general wants of the school for the present year, I recommend the propriety of making it at the approaching session of congress.

There are now in one of the rooms of the building occupied by the navy department a considerable number of flags and other trophies taken by the navy from public enemies in war. I recommend that authority may be given by congress to the Secretary of the Navy, under the direction of the President, to cause them to be placed, with suitable labels, at the naval school, in the care of the superintendent.

The contracts for the naval works at Pensacola, Philadelphia, and at Kittery-the prices to be paid for the works complete-are:

$2,468,584

The report speaks in high terms of the observatory, and suggests the publication of a nautical almanac.

The report bears testimony, as the result of experience, to the efficient organization of the navy department. Grateful obligations to the distinguished men who are and have been in charge of the several bureaus are acknowledged.

Besides the ships on the stocks, in ordinary, undergoing repairs, and in commission, and excluding navy yards and other public lands required for purposes of the navy, with their costly improvements, the reports herewith submitted show that the public property on hand for naval purposes amounts in the aggregate to $9,400,370.

The establishment of a bureau for the ordering and detailing of officers for service, for the general superintendence of enlistments, for deciding primarily on applications for service, relief or discharges, which duties now occupy too large a portion of the Secretary's time, is recommended.

The efficiency of our ships of war, it is deemed, would be promoted, if the marine guard allowed by the regulation could be enlarged, and an increase of the rank and file of the corps from one thousand to fifteen hundred be made. The number of landsmen might be reduced to the same amount. Such an increase of the non-commissioned officers and privates would justify an additional number of commissioned officers equal to the number dismissed.

The report concludes with the recommendation that the marine guards attached, under orders, to the ships of war in the Pacific and Gulf of Mexico, who, it is known, were often on land, co-operating, in the most gallant manner, with the land forces, and encountering all the dangers and privations of the service with the army, be put on footing, as to bounty land and other remuneration, with those who have already received what was given by law to the officers and men of the army.

REPORT OF THE POSTMASTER GENERAL.

This document is of considerable length. We have prepared the following, which is an abstract of all that is important in it.

He commences with the mail services for the year ending June 30th, 1848; from which it appears that there is an increase in the length of routes of 9,390 miles; an increase on the annual transportation of 2,124,680 miles; but a decrease in the cost of $12,145. The new foreign mails have, however, added to the expense of the department. The annual transportation, June 30th, 1848, amounted to 41,012,579 miles at a cost of $2,448,766; which, as compared with 1845, shows an increase in transportation of 5,378,310 miles, but a reduction of cost of $456,738.

The foreign mails, by steamships, are noticed favourably; lines being contracted for, and some of them already in operation, between Charleston and Havana; New York and California, (via Panama;) and New York and Bremen, (via Southampton.)

The revenues of the office more than justify the predictions of those who advocated the reduction in the rates of postage. In the last fiscal year the gross receipts were $4,371,077, being an increase of $425,184 on the preceding year, and exceeding by $6,445 the annual average of the nine years preceding the 1st of July, 1845, (when the reduced postage went into operation,) thus demonstrating that under the low rate of postage the receipts are increased.

The letter postage amounted to $3,550,304, exceeding that of the previous year $295,791.

The newspaper postage amounted to $767,334, being an increase of $124, 174. The number of post offices on 1st July last was 16,159, being an increase during the year of 1,013. The number of offices established was 1,309. The number discontinued 296.

It is estimated that the expenses of the department for the next year (including the sums paid for carrying foreign mails in steamers) will be $4,746,

845; and the receipts are estimated at $5,211,404, leaving an excess of receipts over expenditures of $464,562.

In view of these results, the postmaster general enters into an examination of the question, whether a further reduction in postage ought to be made, and he arrives at the conclusion that it should, and recommends

That the rate of postage on letters be five cents per half ounce or less, for all distances.

That newspapers be weighed; and pay at the rate of one cent per ounce.
Periodicals and all other printed matter, two cents per ounce.
Letters sent to foreign countries, fifteen cents the half ounce.

The total abolition of the franking privilege.

The pre-payment of the postage on all letters, newspapers and other matter sent by mail.

A change in the term of the office of the postmaster general, so as to make his appointment hold for a number of years, he being subject to removal only by impeachment, and the appointment, by him, of his principal subordinates or deputies for a like term of years. In case of the removal of any subordinate or deputy, the fact and the causes of it to be reported to the senate.

THE INAUGURAL ADDRESS OF PRESIDENT TAYLOR.

5th March, 1849. Elected by the American people to the highest office known to our laws, I appear here to take the oath prescribed by the constitution; and, in compliance with a time-honoured custom, to address those who are now assembled.

The confidence and respect shown by my countrymen in calling me to be the chief magistrate of a republic holding a high rank among the nations of the earth, have inspired me with feelings of the most profound gratitude; but, when I reflect that the acceptance of the office which their partiality has bestowed, imposes the discharge of the most arduous duties, and involves the weightiest obligations, I am conscious that the position which I have been called to fill, though sufficient to satisfy the loftiest ambition, is surrounded by fearful responsibilities. Happily, however, in the performance of my new duties, I shall not be without able co-operation. The legislative and judicial branches of the government present prominent examples of distinguished civil attainments and matured experience; and it shall be my endeavour to call to my assistance in the executive departments, individuals whose talents, integrity, and purity of character, will furnish ample guarantees for the faithful and honourable performance of the trusts to be committed to their charge. With such aids, and an honest purpose to do whatever is right, I hope to execute diligently, impartially, and for the best interests of the country, the manifold duties devolved upon me.

In the discharge of these duties, my guide will be the constitution, which I this day swear to "preserve, protect, and defend." For the interpretation of that instrument, I shall look to the decisions of the judicial tribunals established by its authority, and to the practice of the government under the earlier presidents, who had so large a share in its formation. To the example of those illustrious patriots, I shall always defer with reverence; and especially to his example, who was, by so many titles, "the Father of his country."

To command the army and navy of the United States; with the advice and consent of the Senate, to make treaties, and to appoint ambassadors and other officers; to give to Congress information of the state of the Union, and recommend such measures as he shall judge to be necessary; and to take care that the laws shall be faithfully executed-these are the most important functions intrusted to the President by the constitution; and it may be expected that I shall, briefly, indicate the principles which will control me in their execution.