The New York Herald Newspaper, December 9, 1868, Page 5

- $113,352,689, cousisted of certain the recetpts and expenditures for the three quarters ending June so, Li wil be a3 foilows:— From customs. ++ $125,000, From ands... o. 000, From internal revenu From miscel, sources, Recetpts..... “l \ pale ig And that the expenditures for the same period, if there be uo reduction of the army, will be:— For the civil service. ....-++ 000,000 For peusions aud Indians.. 18,000,000 For War Department, in- eluding $6,000,000 boun- > ties... ,000 For Navy in » 34,000,000 For interest ou public debt. 91,000,000 Expenditures. . 231,000,000 ‘The receipts and expenditures under exisiing !aws for the fiscal year ending June 40, 1870, are estimated as follows: From’ customs........ From tternal revenus From lands Brom musceli - Receipts... ‘ $27,000,000 The expenditures for the same period, if the ex- penses of the army should be kept upto about the ror average, will be a3 follows:— a the civil service. 5 D0 is! Fo! For Expenditures..........2s0+e00eee0e-2 $303,000, 000 The accompanying report of the Commissioner of Internal Revenue gives the necessary information in regard to the Bureau, and contains many very ju- dictous recommendations and suggestions which aro the careful consideration of Congress. ‘The ternal branch of the revenue service is the one mW which the people feel tae deepest interest. ‘The customs duties are collected at a few points, and although paid eventually by the consumers they are leit only by ihe great mass of the people in the in- creased cost of the articles consumed. Not so with the internal taxes, ‘hese are collected in every part of the Union; and thelr burdens fall, to a large ex- tent, directly upon the taxpayers. Assessors, col- lectors, inspectors, detectives—necessary instru- ments In the collection of the revenues—are found in every part of the country. There is no village or ural district where their faces are not seen and where collections are not made. The eyes of the Whole people are therefore directed to this system, and it is of the greatest importance that is adiinis- tration should be such as to entitle 1t to public re- Spect. Uniortunaiely this is not the case. Its de- moralization is admitted; and the question arises, Where is the remedy ? The Secretary is of the opinion ‘that it is to be found in such amendments to whe act a8 will equalize the burdens of taxation, and in an Set of the standard of qualification for revenue ces, ‘Upon the subject of internal taxes the Secretary has alreasy spoken, In rezard to the character of the revenue officers he has ouly to say that there must be a decided change for the better in this re- spect if the system Is to be rescued from its demoral- tzed condition. After careful reflection the Sevres tary has come to the conclusion that this change Would follow the passage of the bill reported by Mr. Jenckes, from the, Joiat Committee on Retrench- Ment and Reform, on the 14th of May last, entitied “A bill to regulate the civil service and promote the efmiciency thereof.” The Secretary gives to this bill his hearty approval, and refers to the speech which was made, Upon its introduction, by the gentleman who reported it, tor an able and lucid exposition of its provisions, and for a truthful and graphic descrtp- tion of the evils of ihe present system of appoint- ments to office. ‘ On the oth day of October last, the day for their regular quarterly reports, the number of national ks Was 1,044, seventeen of which were in volun- tary liquidation, Their capitat was. ‘Their discounts Their circulation ‘Their deposits. . + 601,830,278 In no other country was so large @ capital ever in- Vested in banking, under a sing.e system, a8 is now invested tn the national banks; never betore were ‘the inierests of a people so interwoven with a sys- tom of banking as are the interests of the peopte of the United States with their national banking system. It ig not strange, theretore, that the condition and management of the national banks should be, to them and to their represeutatives, a matter of the deepest concern, That the national banking system 1s @ perfect one is not asserted by its friends; that it ig avery decided improvement, as far as circulation is Fegarded, upon the systems which it has superceded, must be admitted by it opponents, Before it was estabiished the several States, whether in conform- ty with the constitution or not—jointly with the general government, during the existence of the charter oi the United States Bank, and soley after the expiration of that cl xercised the power of fgsuing bilis of credit, in the form of bank notes, through institutions of thelr own creation, and thus Controlied the paper money, and thereby, in no q@ulalt degree, the business and commerce of the Country. In May, 1863, wen the National Currency Buread was established in Washington, some 1,500 Danks, organized under State laws, furnished the People of the United States with a bank note cur- Fency. Insome of the States the banks were com- Pagkage! ‘at _least—the holders of ir notes agaiust loss by d its of securities ‘wih the proper authorities. In other States the @apital of the banks—that capital being whol under the control of their managers— me ere Was no limit to the amount of'notes that might be issued, if se- cured according to the requirements of their statutes, nor any necessary relation of circulation to capital. In others, while notes could be issued only im certain proportions to capital, there was no re- striction upon the number of banks that might be organized. The notes of afew payable centres, were current im most of the States, while the notes of other ban! just a3 solvent) were uncurrent the tg of the States by whose authority they were fasued. How valueless were the notes of many of the State banks is still eenly, pememperes. by the direct losses sustained by ‘bank nove circulation and the ind: country resulting de ‘hanges, caused by a local currency constantly subject to the Manipulations of money changers and from the utter ‘nsuitableueas of such @ currency to the circum- stances of tue country, can be counted by millions, to compare the circulation of the Btate banks with that iurnished by the natiouul banks, to vindicate the acme of the present system. Under the national ing system, the goveinment which authorizes the issue of bank ‘Rotes and compels the people to receive them as ant, Assumes ite just eos. and guaran- ‘tees their payment. This is the feature which espe- SS eae wo it its greatest value. ‘the object of the Secretary, however, in referrin: to the qational banks is not to extol them, but to cail the attention of Congress to the accompanying in- @ractive report of the Comptroller of the Currency, especially (o that part of it wnich exhibits the condi- tion and manageiment of the banks in the commer cial metropoiis and to the amendments proposed by him to tie act. day of October last the loans or dis- counts of the banks in the city of New York amounted to $163,684,070, only $90,000,000 of which consisted of comuerc.al paper, the balance being chiefly made of what are known as ioans on call, that 1s to say, Joans on collaterals, subject to be called in at the pleasure of the banks. Merchants or manufacturers cannot, of course, borrow on such terms, and it is persons dealing, or tn T peculath in seoeks or caling, or rather speculating, in stocks or coin, ‘This statement shows to what extent the busi- mess of tue uanks in New York has been diverted from legitimate channe!s, and how deeply involved the bauks have become in the uncertain and danger- us speculations of the strec.. ‘The deposits of these institutions on the day men- tioned ainounied to $226,645,655, and of their assets ash items which Were in tact mainly certitied checks which had been passed Lo the credit of depositors, and constituted a of the §226,645,655 of deposits, although the always deduct such checks from their deposits in mak ae their statement for the payment of in- terest jeir estiates for reserves, itis under- stood to be the practice of a number of the banks (perhaps the practice exists to a limited extent in ail) to prety the checks of their customers in ad- yonce of the deposits out of which they are expected to be paid; im other words, to certify checks to be foods under an agreement between the banks and drawers, that the money to protect em shail be deposited during the day, or at least before the checks, which yo through the ciearing honse, can be Presented for payment. The Serret. has learned With great surprise that a number of banks—gen- erally regarded as being under judicious manage- ment—certily in @ singie day the checks of stock and gold brokers to mauy times the amount of ther capitais, with no money actually on deposit for the provection of the checks at the time of their certification, A more dangerous practice, or more incousisient with prudent, not to say ho baking, cauavt be conceived, It is unanthorzed by the act, and should be pronitited by severe penaities. Aside irom the risk imourred by this reckless metiod of banking, the effect of such prac- tices is to foster speculation by creating mation. It ig, in fact, part aad parcel of that fictivious credit which is 80 injurious to the reguiar basiness of the city and to tie business of all parts of the country, which feel and are advected by the pulsations of the commercial ceatre. It is this very dangerous prac- tice, combined with the more general practice of making loaus “on call,’ which leads to unsafe tensions of credits aud wakes many of the banks fn New York heipless when the money market is stringent. Can anything be more discreditable to tue banks of che great emporium of the country or adord more conclusive evicence of their inprudent managomwent than the fact that, with a capital—in- cluduig their surplos and their undivided protits—of $100,000,000, the wit drawal from cireulation of ten or fil milous of egal tender notes, by combina- tons for speculative purposes, can create a money stringency by Which uot only the stock market is broken down, but the entire business of the city, and to some extent tie business of the country, Is inju- rously affected? il the banks were no more ex- tended than tiey ouglit to be or had proper control over their cusiowers no Bich combinations would bo likely to be foruicd, of, if formed, they Would ut verly faut of their object. These remarks do not, ofcourse, apply to all the wika la New Lurk, for some of them are sirictly commercial inatituvions and are under the contro: o} McD WhO uve Uiginguished alike for thelr talents it and thetr conservatism. They are, however, app'ica- ble to them as a class, and they undobsedly apply 1a some measure to many banks in otherciti ‘The recommendation of the Comptrolier that all ational banks be prohibited by law from certifying checks which are not drawn upon deposits actual y exisiing at the time the checks are ¢ertilicd to be good is heartily concurred in, ‘the Secretary has long entertained the opinion that the practice of paying interest on deposite— tending, a8 it does, to Keep the banks constantly ¢x- tended in their discounts—is injudicious and unsate, He therefore approves of the recommendation of the Comptroter that national banks be prohibited from pat interest 00 bank or individual baiances. ‘he Secretary also agrees with the Comptroller in his recommendation that authority be ‘given to him to call upon the banks for reports on days to be fixed by himseif, If @ reserve is necessary it should be kept constantly on hand, and the business of the country ought not to be disturbed by the prepara- tion of the banks for the quarterly reports. ‘The views of the Secretary in regard to the neces- sity of a central redeeming agency for the national banks have been frequently presented, and It is not necessary for him to repeat them. There are other suggestion in the Comptroller's report deserving the attention of Congress which the Secretary lacks the time to consider. There 1s one subject, however, not discussed by the Corp Fiat to which the Secretary invites special atten- fons the national banking system should be relieved from the limitation now imposed upon the amount of notes that be issued, this cannos safely be done as long as the suspension of specie payments continues. Kcoverthelese, measures: should at once be adopted to remedy, as far as prac- ticabie, the inequality which exists in the distribu. tion of the circulation, As the government has, by the tax upon the notes of State banks, deprived the States of the power of furnishing facilities to their citizens, it i Obviously just that those States which are thus deprived of these facilities, or which do not share eqnally with other States in the benefits of the national banking system, should be supplied with both banks and notes. There are two modes by which this may be accomplished, One by reductny the circulation of the banks of large capital only— the other by limiting the amount of notes to be fur- nisbed to all the bank: to seventy per cent of their respective ca) is. The latter iuode is prever- able, as by it no discrimination would be made be- tween the banks and all would be strengthened by a redugiion of their habulities and by a reicase oi part of theic means how deposited with the Trea- surer, which would be of material service to them in the preparation they musi make for a return especie payments, If a redeeming agency should be established, the seduction of the circulation of the existing banks could be aifected as rapidly as new banks cau be organized in the Western aud Southern States where they are needed, ‘the new ‘Territory of Alaska has been the object of much attention during the past year, but its distance, and the uncertainty and infrequeacy of commun tion with it, and our imperfect knowledge of tis con tion, have somewhat embarrassed the department in organizing therein @ satistactory revenue system, Juder the authority of the act of the lass session, the administration, by special agency (which in tre absence of the regular machinery was of necessity resorted to), has been superseded by the appoini- ment of @ collector to reside at Sitka, who left tor his post in September 1486, and has probaoly, ere tis, niered upon the discharge of his duties, A gentieman from this department accompanied him to assist in establishing the collection service oa & proper foundation, and in perfecting arranuge- ments for the prevention of smuggling. Recognizing also the vast importance of reliable in- formation Of matters hot immediately counected with these objects, but having nevertheless a most important bearing upon them more or less direct, another agent, long famihar with that country, was, at the same time, despatched with directions to apply himself to the ascertainment of its natural ‘resources, the inducements and probable channels of trade, and the needs of commerce in the way of lights and other wids to navigation. He was also particularly ea- trusted with a supervision of the fur interests and the enforcement of the law prohibiting the killing of the most valuable fur-bearing animals, ‘The existence of coal at numerous points has been known for years, aud some of the beds were worned by the Russians witi indliferent success. Noue, however,, has been hitherto procured on the North American Pacific coast equal to that from the Nanal- Ino imines, on Vancouver's Island; and this, though raised trom a considerable depth, 13 not of superior quality. The officers of the cutters were. therefore instructed to explore the coast as lar as practicabie, for the purpose of ascertaining the suppiy and the quality of coal in the ‘Territory. A num- ber of localities producing coal were visiied, including the abandoned Russian mines, but at none did the outcroppings exhibit any flattering promise except on the coast of Cook's in- let. There, near Fort Kenay, about 700 miles from Sitka, were found apon the cliffs numerous paraliel veins extending many miies along the shore. Somo of the coal taken from thein proved to be superior to that from the Nanaimo imines. ‘The indications are that the supply is abundant and the quality fair. ‘The protection of the fur-bearing antinais 1s a mat- ter of importance tardiy to be overrated. In conse- quence oi information received last spring the ca tain of the Wayanda was directed to visit, as early in the season as oe the islands in Behring’s sea, where the seal chiefly abounds, On fis arrival at St. Paul’s and St. George’s islands he found there several large parties engaged ‘in hunting the animals indiscriminately and in trafic with the natives in ardent spirits and other forbidden articles. Quarrels had arisen, and the natives complained that the reckless and unskilful movements of the new hunters had already driven the als from some of their usual haunts, The captain of the cutter instituted such measures as ne feit authorized to institute for the maiutenance of the peace and the protection of the animais from indiscriminate slaughter. ‘The preservation of these animals, by the observ- ance of strict tions in hunting them, is not only @ matter the highest importance in an economical view, but a matter of life or death to the natives. Hitherto seals have been hunted under the supervision of the Kussian company, and exclusively the natives, who are trained from children to that occupation, and derive from it their clothing and subsistence. They have been governed by exact stringent rules as tothe time of hunting, and the number and kind of seals to be taken. It is re- commended that these rules be continued by legal enactinent, and that the existing law prohibiting absolutely the kii of the fur seal and sea otter be rey a8 starvation of the people would result from its strict enforcement. The natives (with the exception of the Indians in the southern part of the Territory, who are fierce and warlike), are a gentle, harmless race, easy to govern, but of great enter- prise and daring in the pursuit of game, many of them passing annually in thetr skin canoes from the mainland and Aieudan islands to the islands of St. Paul and St. George, a distance of about one hun- dred and fifty miles, through @ strong sea, and re- turaing with the proceeds of their huat. The seals are extremely timid and cautious. They roach their accustomed grounds each year with tne test circumspection, seuding advance par- reconnoitre aud at once forsaking places where they are alarmed by unusual or unwelcome visitors. They have been in this way driven from point to point, aud have taken refuge in these re- mote islands, whence, if they are now driven, they must resort to the Asiatic coast. There can be no doubt that, without proper regulations for hunung, these valuable animals, and the more valuable but leas numerous Kea otters, a very profitable trade wili soon be entirely destroyed. The United States cannot of course administer such @ trade as a government monopoly, and the only alternative seems to be to grant the exclusive privilege of twking these animals to a responsible company for @ series of years, limiting the number oft king to be taken annually by stringent provisions. A royalty or tax might be imposed upon each skin taken, and @ revenue be thus secured suificient to pay a large part of the expenses of the Territory. Our relations with the Hudson Bay Company and the reguiation of the transit of merchandise between their interior trading posts and the seacoust, by way of Stikine river, will, doubtless, require early atien- tion; but at present the Secretary is not sufficiently —— to offer any recommendations upon the subject. ‘The recent political changes in Spain, and the in- dications of # more liberal commerctal policy on her before the revolution took piace, add force to the remarks and recommendation of the Secretary 1n his jast report in regard to our commercial rela- tions with that country. He again sronaiy, recom- mends the repeal of the acts of July 13, 1832, and June 80, 1854, su that Spanish vease!s may be subject to our genet jaws, Which are ainple to afford pro- tection agatlast unfriendly Spanish legislation, and are free from tie innumerabie dificulties of ad- ministration Which exist under these special enact- ments. The Secretary asks attention tothe necessity of more exact and strmgent laws respecting the car- riage of passengers, and also of sacl jegisiation aa shall settie, #0 far as they can be settled in this man. ner, sowe Of (he vexed questions arising under eainboat lAWs. It is necessary merely to repeat what has been at other tines stated, in rogard ty the insuiticlency of the tax find to mect the necessary expenses of the marine hospitals, notwithstanding the economy which, during the past year, bas reduced the ex- mditares more than $12,000, It is impossible to ignore the fact that these hospitals are and must be, unless the rate of (he tax i# largely increased, a con- stant drain upon the Treasury, The revenue cutter service now comprises twenty. five steamers and seventeen sailing vessels, OF Ue Bix steamers On the lakes ali but one are at present, agreeably to the views of Congress, out of co sion, the Sherman alone being in active servi Five of the stermers on the sea tugs, from forty vo sixty tons burden, the ubiity and efiiciency of wh the leading ports—as substi- tutes for ordinary row poate on ibe one band, aud for the light cutters on the other, both in th Guties of Inspection and police and in the pre and dotection of smuggiiag—have boen «o thor: = ly tested by oxperience that tt 18 thought they should be employed sul more extensively than they now are, Upon the lakes in particniar they would be of the greatest. value, and they should be suirstituted for the large steamers now there, Which should, With one exception, be sold, as they’ are deproeiating in value aud are @ useless Expense, The exception is the §. P. Chase, watch {§ of such dimensions tat she might be brought (o the sea coast, wi be used to advan ‘This Would probably be pre- ferable to a sal hor where slie lies, The schooner Black, being old and not fit for further service, has been sold. ‘fie Morris, also, if About to be disposed of for the same reason. The siowmer Nemwalia, i. tioned at Noriolk, has been destroyed by acctde: res ‘On the Pacific coast are the Weyanda, in Ala the Lincoln, at San Franctseo, bo h in exce condition, Te schooner Reiianee, focent y order NEW YORK HERALD, WEDNESDAY, DECEMBER 9, 1868.—TR to Sitka, 14 also in good order. ‘The schooner Lane, ret Sound, 18 old and unit for the requirements of that station, Fi the ition of several thousand miles of sea coast hase of Alaska renders the cutter force quate foreven the ordinary du- ning to he service, without regard io the additional demands upon tt for the protection of the fur-bearing animals, fhe recommendation hereto- fore made that two first class steamers be built or purchased for the western coast is Lherefore renewed. A steain cutter is also needed for Charleston and one for the coast of Texas. in his report for the year 1866 the Secretary called the ationtion of Congress especially to the condition of the stuipping interest of the United States. Tn his report of last year he agaia referred to ii in the fol- lowing language:— The shipping interest of the United States, to a great degroe rostrated by the war, has not revived during the p: ‘shipyards ai ih rare exceptions, inactte, plus products are being ciety transported to foreign coun- ries Ju foreicn vessels, ‘The lary is still forced to ad- mit, in the language of his last report, *that with unequalled facilities for obtnining the materials, and with acknowledged skill in shipbuilding, with thousands'of miles of sea coast, ln- dented with tha finest harbors in the world, with surplus pro- ducts that require in their transportation » large and increas ing tonnage, we can neil rofitably build ships nor sic: cessfully o ‘with English ships in the transportation of our own productions.” No change for the better has taken place since that report was mace, On the contrary the fudications are that the great ‘pbuilding interest of the Eastern and Middle States has been steadily declining, and that consequently the United States is gradually ceaslog to be a great maritime Power. A return to apecle payments will do much, but will not be sufll- cient to avert this declension and give'activity to onrabip- yards, The materials which enter into the construction of vesnels should be relieved from taxation by means of draw- backs; or if this may be regarded as tmpracticable aubaldies might be allowed as an offset to taxation, If subsiaies are objectionable then it 1% recommended that all restrictions upon the re:istration of foreign built vessels be removed, 60 that the peop.e of the United States who caunot profitably build vessels may be permitted to purchase them in the cheapest market. It is certainly unwise to retain upon the statute books a law restrictive upon commerce when It no longer accomplishes the object for which it was enacted. What was said by the Secretary.in 1866 and 1867 upon this subject is true at the present time, and he therefore feels it to be lis duty to repeat bis recom- mendations. The shipping tuterest was not onty ppeac seas by the war, but its continued depression is attributable to the tinancial legislation and the high faxes consequent upon the war. The honor pnd the welfare of Une country demand its restora- ion, “ Accompanying this report there ts a very accurate and instructing chi prepared by Mr. 8, Nimmo, dr., a clerk in this department, which presents in a eondensed form the progress 0F shipbuilding in the United States from 1817 to 1868, SEs wo Since the abrogation of the treaty of June 4, 1854, hetween the United States aud Canada no favorable opportunity for a recousideration of the commercial relations of the two countries has been presented, Canada has yet to consolidate a political coniedera- tion with the other English colonies and possessions on this Continent, and until the hostility of Nova Scotia to that measure is removed and the concur- rence of Northwest British America is secured the authorities at Ottawa are in no situation to make an adequate proposition to the United States in ex- change for the great coucession of an exceptional tart on Our noriueru frontier in favor of the lead- 1 ane a ther Me ee Beare hand, acca Juited States shail have mgtured a satisfactory system of duties, eter 4 Bal ae internat, the Seereiary would be indisposed to favor any special arrangement which would remove any material branch of the revenue system from legislative con- trol, Meanwhile a Canadian policy for the en!arge- meut of the Welland aud St. Lawrence canals to dimensions adeqnate to pas vessels of 1,000 tons burden from the Upper Lakes to the Atlantic, will doubtiess be regarded as _indispeasabie to any substantial renewal, by treaty or legisiation, of the former arrangement, Tho discussions aud experience of the last twelve months are regarded, by the Secretary, as warranting an authorative com- parison of views between the representatives of Great Britain and Canada and the government of the United States, aid in that event this Depart- ment wilt cheerfully contribate, by all appropriate incaus, to comprehensive measures which shati as- milate the revenue systems of the respective puntries, make thelr markets mutually available, aad, for ail commercial or social purposes, reader the frontier as nearly an imaginary line as_ possible, ‘There ‘certainly seems no just reason why all the communities on the Aimerican continent might not imitate the example of the Zollverien of the Ger- man States, ‘the progress of the coast survey has been satis- factory and commensurate with the appropriations, 48 will be seen from tle annual report of-the su intendent of that work, During the past year sur- veys have been in progress in the following localt- ties, named in geozraphical order, viz.:—On the coast of Maine, in Penobscot bay and on the islands lying within 1t3 entrance; on the sforea of St. George’s and Medoniak rivera; in Muscougus bay; on the estuaries of Quolog bay and in the vicinity of Portland, completing all the inshore work between the Penobscot and Cape Elizabeth, Jn Massachusetts, between Barnstable and Monomoy, completing the survey of Cape Cod. In Rhode Island, on the western part of Narraganset Bay. In New York, at Rondout and in the Bay of New York. In New Jersey, on the coast near the head of Barnegat Bay. In Maryland and Virginia, on the Potomac river and the southern part of Chesapeake Bay. In North Carolina, in Pamlico Sound and on its western shore, including Neuse and Bay rivers and of the coast north of Hatteras. In uth Caro. lina, on the estuaries of Port Royal Sound, In Georgia, on St. Catharine’s, Doboy and St. Andrew's Sounds; in the Florida Straits and in the bay be- tween the keys and main shore of Florida. On the coast between Pensacola and Mobile entrances. At the wa gener of the pee Ae and in Galveston, Mata- @ and Corpus Christi Bays, on the coast of In Caiifornia surveying ies have been at work on the coast betweon Buenaventura and Santa Barbara, at Point Sal and on the Peninsula of San Francisco; in Oregon, on Yaquinna Bay, Co- lumbia and Uehaleur rivers; in Washington Terri- tory, on Fuca Straits and in Puget Sound. In the Coast Survey Ofice forty-eight charts have been entirely or partially engraved during the year, of which nineteen have been published. Regular observations of the tides at seven principal stations have been kept up, apd tide tables for all parts of the United Sta es for the ensuing year have been pub- lished. A new edition of the “Direciory,” or ‘Coast Pilot,’’ for the western coast has been prepared, and a preliminary guide for the navigation of the norih- western coast been complied, This brief glance at the operations of the Coast Survey during the al year shows the great scope of that work, wh has justly earned a large measure of puvlic favor, Ite importance to the com- merce and navigation of the country is now well understood, nor can its incidental contributions to aclence fail to be appreciated by the representatives of the people. The work should be pressed steadily forward, with means suificient for the most effective working of the ¢xisting organization, so that it may embrace, at no distant period, the whole of our ex- tended coast line within its operations, including the Lees harbors in our newly acquired Territory of ihe ‘Lhe report of the Lighthouse Board is as usual an interesting one. No bureau of the Treasury Depart- ment is conducted with more ability or with a more strict regard to the public interests than this, In view of the Cy of the lighthouse system, consequent upon the Merease of the commerce of the country and the acquisition of sea coast territory, it ia respectiully submitted that some authoritative definition of the limitto which aids to navigation shall be extended by the genetal government should ue established, It may well be dorted whether the general gov- ernment should be called upon to do more than to thoroughly provide the sea ana lake coasts with lights of high order, both stationary and floating, and so to place lights of inferior order as to enabie vessels to reach secure anchorages at any season of the year. e act of Congress, approved August 31, 1852, establishing the Lighthouse Board, directs that the coasts of the United States shall be divided into twelve districts, It is recommended that anthority be given to increase the number of districts to four- teen. The business of the Burean would be facilitated it Congress should confer the franking privilege upon the Lighthouse Board in the same manner and upon the same terms as it is now exercised by the several bureaus of the Treasury Department. The attention of Con; 1s called to the annual Teport of the Director of the Mint, which contatus the usual statistics of the coinage of the country, and various suggestions aud recommendations, # hich are worthy of cousideration. The total vaiue of the bullion deposited at the mint and branches during the fiscal year was $27,106,318, of which $26,472,504 was in gold, and $1,693,423 In sliver, Deducting the redeposit, the amount of actual deposit was $24,591,325. ‘The coinage for the yeai $18,114, gold wars, $6, $1,186,750; silver bars, $456, bronz colnage (one, two, three and i by $20,064,500; was in gold coin sliver com, , copper and eat pieces), $i, 5; total coinage, total bars Blam ped, $6,480,046, a ‘he gold deposits of domestic production were at Philadelphia, $1,300,995; at San Francisco $14,350,117 at New York, $5,409,086 $397,035. The silver deposits Were at Philadelphia, $97,700; at San 7 eo $651,290; at New York, $262,512; at Den- 082, golt and silver deposits of foreign production were $1,686,002. The amount of gold coimed at Phijae deiplia was $4,864,425; at San Francisco, $14,979,5. of silver at Philadelphia, $514,750 san Franciace, 2822,000; of pickel. copper and brouze at Philadel. phia, $1,712,555. The total number of pieces comed int. at Denver naa never coined mo- Xpenses are entirely out of proportion to its Dasiness. ‘The law under Which tt Was organ- ized shoul t be repeated, aud the instiLution reorgau- 1200 as on Assay Office. During the past year the branch mint bullding at arson city, Nevada, has been compicted, and the ary machtir and fixtures have been for. vi 1. It walt be ready for work early next season, ‘The roint at Philadelphia and the branch mint at San #rancisco have the contidence of the people aud of the government, and when the new mint buildin in San Francis 4 erected these mints will be o: ample capacity to supply coinage for the whole mmtry, ‘The biisiness of comage requires large and naive establishinents, under { of men of and of undoubted integrit; such can be Auccessinliy maintained only at commercial centres , where bniiton of diterent degrees of fineness is con- tinaaily offered for manipulation. The establishment of additonal branch mints is therefore unnecessary, ated Would be injudteious, niire deposits at the branch mint ta San Francisco were formeriy in unparted ballion; now wo-thirds of tae amount 18 di cod in bars, red by private ostanlishments, The law requires (hat the partag chagge ehail equal the sctual cost of the process; but theexperience of the past four years slows that not less than $30,000 andually may be saved to the goverament by discontinuing the busi- hess of refining upon the Pacsdle coast; and it 1s, therefore, recommended that the Secretary be authorized to exchange the anparted builion de- posited at he nine for reined bars wheuever, in bis opinion, tt may be for the public int t to do 89, It is aise recommended that authority be given for the redemption of the one and two cent pieces by the Treasurer, under such rates and regulations as may be preseribed by the department, On the thrst day of Apriliast Mr. R, W. Raymond Was appoiuied Commissioner of Mining Statistics, in place | of Mr, J, Ross Browne, now Commissiouer to Mr. Raymond was instructed to continue the work #0 abiy commenced by redecessor, and his re- port wilt show with what ditigence and ability he ts. performing the duties assigned to hin, ‘The Seere- lary Invites the attention of Congress to this report, aud asks for the recommendations which it contains due consideration, ‘Tho following extract from the Secretary's report of 1867 presents, in Janguage Which be cannot muke more explicit, his present views:— The Secretary respectfully recommends the rearganization of the accounting oilices of the Treasury Department, so 49 to place this branch of the public service under one responsi - bic head) according to what sems to have boen designed in the original organization of the Department, and followadt until the increase of business led to the creation of the ollice of Second sioner of Customs, ‘There are now three ollicera controlling the settlement of accounts, each independent of the others, and, a8 a consequence, the ‘rales and decisions are not uni- form where the same or like questions arise, In the judz- the coucentration of the accounting would secure greater elliciciency as ity of practice than can be expected under # divided supervision, It ia believed, also, that it would be advantageous ty reileve the Commissioner of Customs of the duty of settling nw and to contine his Jnbors to the supervision of the revenne from @stoms, now. sutictently Large (o demand his whole time, [tis therefore Teeoromended that the office of Cnief Compirolier be created having general supervision of tha wecouating odicors ‘and appellate jurisdiction from their decisions, to which should be transferred the daty of examining and eountersigning warrants on the Treasury, and of colieoting debts due the government, wstituitng & part of the duties of the First Comptrolier, and that the adjustment of accounts pertaining « tothe custous vo restored (othe latter oltiee. retary also renewa the recommendation contained fn his Jast annual report, of a reorganization of the bureaus ofthe department, und ‘most reapecttully and earnestly 60- Heits forte the favorable action of Congress. ‘The compensi- tion now paid is inadequate to the servicns pertormed, and simple justice to gentlemen of the abiilty and character those employed in the department, re-juires a liberal addlttoia ie rates of compensa- e duties, labors and re- aponsivilitics of the bureaits have Been largely fncreased, and the necessary expenses of living in Washington bave been more than doubled, The Secretary also recommends that achange be made In regard to the adjustment aud settiement of accounts in the oilce of the Third Auditor; that a pe- riod be fixed within which war claims shall be pre- sented, and that measures be adopted to perpetuate tesitmnony in cases of claims that are disallowe The able report of the ‘Treasurer gives a detailed account of the operations of the ‘Vreasary during tue jast fiscal year, and coniains many valuable sugges- tions for the consideration of Congress. The report of the supervising arcu gives falland detailed accounts of the progress that has been made n tue construction of public buiidi ngs. The reports of tie heads of all the respective bureaus will be found to be of nnasnal interest— containing, a3 they do, accuraie information in re- ard to the affairs of tie governinent in this imterest- ig, verjod Of its history. ir. S. M. Clark having resigned the office of Superintendent of the Bureau of Engraving and Printing, Mr. G. B. MeCartee has been placed te: porarily in charge of it. As the past management and preseat condition of this bureau are now under dnvestigation by the Joint Committee on Retrench- ment and Reform, the Secretary feets at liberty only to say at this time that, from the examinations wich he has caused to be made by oicers aud clerks of this department, he feels justified in remarking that the reporis wich have been at various times put in clreulation jn reward to over-issues of notes or se- curities and df dishonesty in tie administration of the bureau, are wafounded, A systematic eifort is being made to reduce the ex- ponses of the adminisiration of tue customs service, and with considerable success, ‘ne process is necessarily slow and beset with diilenities; but material reduction bas been already made, and stil) greater is in progress, During the war the business of the Treasury De- partment was so largely and rapidly increased, and 80 many inexperienced men were necessarily em- pi J, that perfect order and sytem couid not be Many accounts were unsettied, and some es of business had fallen tato confusion. Much attention las been given by the Secretary “to straightent ne up” the affairs of the department, He is now gratilied in being able to say that order and system have been introduced where they were found to be needed; that the bureaus are in good working order, and that the “machinery” of the department is in as satisfactory condition as perhaps it can be, under existing laws. The result of the exaininations which he has caused to be made has excited his ad- iration of the wisdom displayed by Mr. Ham In the system of accounting which he introduced, and most favorably impressed him with the value of the services of the men, who, poorly paid and little known beyond the walls of the Treasury building, have for years condutted, with unfaitering fidelity, the details of a business, larger and more compli- cated than was ever devolved upon a single depart- ment by any government in the worid. In concluding this communication, tt may not be r the Secretary, in a few brief words, to review some points in the general policy of the administration of the Treasury for the past four years, The following statement, published in the last ‘Treasury report, exhibits the condition of the Treas- ury on the Ist of April, 1865:— Funded debt. Matured deb oe ‘Temporary loan certificates Certificates of indebtedness. Interest-bearing notes...... see Suspended or unpaid requisitions. . United States notes, legal tender Fractional CUrrency,....-...+0 $2,425,437,002 Cash in the ‘Treasury. 56,481,924 Total. scecceeeees $2,360,955,077 By this statement it appears that, with $56,481,924 in the Treasury, there rere requisitions waiting’ for payment (the delay inthe payment of which was greatly ‘alscrediting the government) to the amount Of $114,256,548; that there were $52,452,328 of tem- [eae loan certificates hable to be presented in m ten to thirty days’ notice, and $171,790,000 of certificates of indebtedness wich had been issued to Captor a eas wat of money to pay the requsi- Uons in their fayor, and which were inaturing daily. At the same time the efforts to negotiate securities not being attended with the usual success, while the expenses of the war were not less than $3,000,000 per day. The vouchers issued to contrac- tors for the necessary supplies of the army and navy—payable, one-half in certificates of indebted- ness and the other half in money—were being so'd at 4 discount of from ten to twenty per cent, tndi- cating by their depreciation how low was the credit of the government and liow uncertain was the time of payment. ¢ fall of Richmond and the surrender of the army of Virginia under Genera! Lee (whict virtually closed the war) had not the eifect of relieving the On the contrary, its embarrassments Were increased thereby, inasmuch as it geemed to leave the government without excuse for not paying its dents, thesame time that popular appeals for sulxcriptions to the public loaus were divested of mueh of their strength. As long as the government wasin danger by the continuation of hostilltes, the Patriotism of the people could ve successfully ap- pealed to for the purpose of raising money and #us- laiting the public credit, without which the war could not pe vigorously prosecuted. When hostilt- ties ceased and the saiety and unity of the govern- meat were assured, self interest became again the controlling power. it will be remembered that It was thea generally sup that the country was alrtady fully supplied with securities, and that thera Wat aiso thi at tne Union # prevatiing appre- hemion that financial disaster would speedily follow the termmation of uie war. The great- ness of the emergency gave the Secretary no tims to try experlinenis for borrowing on a new security of long time and lower interest and rempved from his mind all doubts or hesitation in regérd tothe course to be pursued. It was esti- mabd that at least $700,000,00) should be raieed, in addhion to the revenue receipts, for the payment of the requisitions already drawn aud those that must 8008 follow—preparatory to the disbandment of the ri Unton army—aud of other demands upon the ury. The anxidus inquiries they were, by wh® means cau this large amount of money be raigd? and not what will be the cost of raising it. lo@ can the soldiors be paid and the army be dis- banked, 80 that the extraordinary expenses of the Wat Department may be stopped? and not what pans interest shail be paid for the money. These ‘wen the inquiries pressed upow the Secretary. He ansfered them by calling to his aid tie well-tried agett who had been employed by tis twmediate predecessors, and by oiferng the seven and three. tentia notes—the most popular loan ever oered to the people—in every city and village, and by se- curly the advocacy of the press throughout the jenggn and breadth of the Jaud, In less than four moibhs from the unie the work obtaining sab- sertjtions was actively commenced the Treasury iL & condition to meet every demand upou tt while the Treasury was thuy relieved the ver of the debt wat by no means satisfactory, © Ist day af September it Coasisted of the fol- $1,109,568, 191 1,608,020 107,148,715 90,095,000 onal curreney.... uded reqaisitious une Baane . $2,757, 689,071 Fom this statement it will be perceived that $1,2 ease of the public debt consisted of various pea I lemporary securities; $45,160,209 of United Stale notes—the excess of which over $40,000,000 having been put into circulation in payment of tem- poraly loans—and $26,344,742 of fractional currency, Vortbns of this temporary debt were inatuting daily, and i Of it, including pt aad of the funded debt, was to be provided for Within @ period of three = ‘The Pree notes were, by law aad the termi of the loan, convertible at maturity, at tue Will tae holder,’ Ano tive-swouty bends, oF vaya | IPLE SHERT. ble, like the rest of these temporary obligations, in Jawta money. It was of course necessary to make provision for the daily maturing ‘dept and also, for taking up from time to time, such’ por- tons of it as could be adv: ously — Con. veried into boads, or paid in curre before ma- turity, for the purpose of avoiding ¢! pesity of mulatiog large sums of money, ane relieving ac the 'Treasary from the danger would be exposed to if a very considerable portion of the debt were permitted to mature, With no other means for paying it than thac afforded by sales of bonds in a tarket too un ain’ to be contidentty relied upon in an emergency. In addition £0 (he temporary loan, payment of which could be demanded on so short @ notice as bo inake it virtually & debt payable on de- mhand—the certiticates of indebtedness, were ma- turing at the rate. of from $15,000,000 Lo 000,000 per month—the five per cent notes wich matured in January following, and the compound intorest notes, Which were payabe at Various times within a period of three years—there were $5710,000,000 of keven-thirly notes Which would become due as fol- lows, V1Z.:— August 15, 1807. «$00,000,000 + 200,000,000 June 15, 1868. July 15, 1568, + 230,600,000 As the option of conversion was with the holders of thebe notes, it depended upon the condition of the market, whether they would be presented for Ppayinent in !awful money or to be exciianged for bonds, No prudent man, entrasted with the care of the nation’s interest and eredit, would permit two or three hundred militons of debt to mature without Making provision for its payment; nor would he, if it could be avoided, accumulate large sums of money in the ‘Treasury which would not be called fox, if the price of bonds should. be such as to mike the con- version of the aotes preferable to their payment in lawful money. ‘he policy of the Secretary was, therefore, as he remarked in a former report, deter> mined by the condition of the Treasury and the country and py the characier ot th simply, first, put aid Keep the T in such coudition as not only to be prepared to pay all elaims upon presentation, but aiso to be strong enough to prevent tig success of any combinations that he formed to control its ma ty and se to take up quietly, in advance of the Payment or conversion, Buch portions of vue & raty debt as ‘would obviate the necessity of. accumulating large currency balances in the Treasury and at the same time relieve it from the danger of being forced to a further issue of legal tender notes, or to a sale of bonds, ab whatever price they might command. In carrylag Out this policy it Seemed also to be the duty of the Secretary to have due regard to fhe | ‘esls of the people and to prevent, as far ad posible, ihe work of funding from disturbing legiti pusiness., AS financial trouble has almost invariably followed closely upon the termination of protracted wai Was generally (eared, as has been already remarked, that such troubie would be unavoidable at the close of the greatand expensive war in which tie United Siates had been for tour years engaged. ‘This, of course, it was importance to avoid, as is occurrence mught not only render funding dificuit, bat might prostrate those great interests upon which the gov- ernment depended for its revenues. It was aud con- siunily has been, therefore, the aim of the Secretary so to administer the ‘ireasury, while borrowing | money and funding the temporary, tons, a8 Lo prevent a commercial crisis, and to p the bust hess of the counity a8 steady as was possible on the basis of an irredcemabie aad constanUy fueruating currency. Whether his eiforts have contributed to this end or not he does not undertake to say, but the is unquestioned that a great war lias been closed, large loaus have been efiected, heavy revenues have been collected and some thirteen hundr muilons: of doliars of temporary obligations been paid or funded, and a great debi brot manage- able shape, not only without a financial Is, but Without any disturbance to the ordinary busine the country. To accomplish these things suct fully, the Secretary deemed it nec as has bi before stated, thai tie Treasury should be Kept con- Biaatly in a strony condition, with power to prevent the eredit of the government and the great interests of the people from being placed at the merey of ad- versé fhildonces, Notwithstanding the magnitude aud characier of the debt, this power the Treasury has for the lasi three years possessed; and it has been the well Known existe rather than the ercige Of it, Wich has in repeated Last 8 3) the country from panic and disaster. 4 gold re- serve, the maintenance of waich has subjected the decretary to coustant and bitter criticism, has given @ confidence to tie holders of our securities, ab home and abroad, by the consiant evidence which it ex- hibited of the ability of the government, without de- pending upon purchases in the market, to pay the interest upon tue public debt, and a steadiness to trade, by preventing viclent fluctuations in the con- vertible value of the currency, which have been 2 more than ample compensation to tie country for any loss of interest that may have been sustained thereby. if the gold in the ireasury had been sold down to what was absolutely needed ior the pay- ment of. the interest on the public debt, not only would the public credit have been endangered, but and, consequently, the eutire business ‘y would have been constantly subject to the dangerous power of speculative combination, Of the unavailing effort that was mace by the + retary to contract the currency, with the view of WAR. enna anne REPORT OF J. M. SCHOFIELD. I have the honor to submit @ general report of the Operations of this department since the last annual report of the Secretary of War, with the reports of the chiefs of bureaus and military commanders for the saine period, ADJUTANT GENERAL'S DEPARTMENT. ‘The strength of the army on the 30th of Septem’ Was 45,081, which by the Ist of January next will be reduced, by the expiration of term of service alone, to about $3,000, Orders were issued tn November last to reduce all regiments Of infantry and artillery (except ten light Datieries) to fifty men per company. No recruiting rendezvous are now in operation except for the cavalry service, (4 the expense of the recruiting service is reduced to the minimum, All volenteer oMvers except one haye been amuse tered out of service, /' At the suggestion of Lieutenant General Sherman authority Was given on the 6th of October iast for the muster-In of one regiment of volunteer cavairy from the State of Kansas for service against hostile Indians. The service of this regiment is not ex- pected to exceed months, afier which, it is hoped, the regalar cavalry wili be sudicient for the frontier service, It may be reasonably expected that a considerable reduction of the infantry of the army may be made within the next year without detriment to the Inter- esis of the country. I recommend that such reduction be authorized by law to be made gradually by ordi mary ¢ a'ties, by discharge of incompetent and unworthy officers and by consolidation of regiments. Lalso recommend that the four regiments constitnt- ing ihe Veteran Reserve Corps be disbauded, oiticers uniit for active service to be retired and ali others to be transferred fo active regiments. ‘the term of enlistment for all arms of the service should be increased to flve years, a3 @ measure of economy and eniviene: INSPECTION SERVICE. Through the agency of the inspection branch of the service, tie eutire army, With afew exceptions, otherwise especially provided for, has beew thoroughly and constantly inspected during the year, and numerous. special Investigations have beer made, resulting in material improvement in the edi- ciency of the troops, in the economical Management of the administrative branches and in the care and disposition of public Moneys and property. ‘ Both bere and abroad inspections have come to be regarded as indispensable to successtul Management ola mililary id the conviciion of: their usetuiness is where gaintug ground, ‘The importance of the duties to be periormed and the insuillcient number of officers of te regular in, Spection has resulted in the adoption of a sysiem whereby the required number will be sup- plied by detail of fleld oficers im addition to the rega- jar inspec tue selections to be made by the War Depa at ‘This plan is designed to secure oilicers of proper capacity, judgment and experi- ence, and to obviate the necessity an immediate ase tu the corps of laspectors, Which now num bers but nine oficers. BUREAU OF MILITARY JUSTICE. The oMcers of this bureau consist of a Judge Ad+ vocaie General, an Assiscant Judge Advocate Gene- ral and cizot Judge Advocates. Tae two vacancies in the grade of Judge Advocate and the ence of any lezal proviston tor fill them has prevented a comp'iance with several applications from depart-’ ment commanders for such oMeers, ‘ork of the bureau ts comprised in 15,046 re- cords of milliary couris received, reviewed aud registered aud 1,457 reports ou various subjects es- pe ly referred for opinion. It js recommended that the number and grades of officers of the bareau be permanently flxed by law, 80 thas Vacancies may be tiiled, SIGNAL SERVICE. Provision has been made during the past year for such general instruction m morgen telegraphy and signaling a8 may be necessary for the service. Books of instruction have been turnisked each com- pany and post, and steps have been taken to provide necessary telegraphic apparatus and the equipme for siguatling. The courses of study in military telegrapbhy and signalling have been pursued with success at the Military Academy at West Point. By concert with, the oicers of the navy, nearly similar courses of study and practice in these branches have been had at the Naval Academy at Annapolis A driil with a fleld e legraph train has been introduced and practised at West Point, the cadets discharging all the dutes of ranaing out and erectin the lines, working the telegraphic instruments’ and! appreciating it to the specte standard, he forbears to speak. His action in respect to contraciion, aithough authorized, and for a tme sustained, was subsc- quently disapproved (as he thinks unwiself) by Con- gress. This is.a question, however, that can be bet- ter determined hereafter than now, hope yoy has been made thac, in the administra tion of the Treasury Department since the war, there has been too muca of interference with the siock and money market. This complaint, when honestly made, has been the result of @ want of reflection or of imperfect knowledge of the financial condition the government. The transactions of the Treasur. have, from necessity, been connected with the stoc! and money market of New York, If the debt after the close of the war had been a funded debt, with nothing to be done in relation to it but to pay the accruing interest, or if business had been conducted | war, to be $36,606,381. on @ specie basi the constant changes to which it has been and must be subject—as long as there is any considerable difference between the and commercial acuding and receiving messages by sound. A school of telegraphy and signaiiing has been established at Fort Grebel, Maryland, end 1s im asful operation, At this sciool selected v3 and enlisted men are instructed in all the duties pertaining to the service with electric tele- graphs and signals. A simple telegraphic code, easily acquired, 18 used for this purpose, ‘fhe report of the Chief Signat Officer and the sub- reports covered by it give detatis of the «duties of his office for the past year and the results so far at- tamed. QUARTERMASTER’S DRPARTMENT. The report of the Quartermaster General showa the total expenditure of that department during the fiscal year snciag Sine 30, 1868, inciudsng claims for stores taken for the use of the army during the Claims for property taken \ and consequently been free from during the war have been allowed to the amount of $500,313; rejected, $2,654,430; and are still pending to the amount of $6,905,691. In the national cemeteries 316,233 remains of sol- legal standerd of value—the Treasury could have been | diers have been collected, of which 175,764 are iden- with entire indepenaence of Stock Exchange or the Gold Room. Such, however, was not the fact. More than one-half of the national dept, according to the foregoing ex- hibits, consisted ol were to be paid tn lawful money or converted bonds; and there was in circulation a large amount of irredeemable promises constautly changi m their convertible value. ‘The Secreta couid not be indifferent to the conditior of the mar- pn ge avoid connection ies it, for it was, in fact, | date the several branches of the War witl the market he He would have been Pe y had it been otherwise. If bonds were to be sold to provide the means for paying the debts that were payabie in lawful moncy it was a matter of great importance to the ‘freasury thatthe price | q the | tifed. temporary obligations, which | fersonviile wi mto | be broken up. ‘The total cost has been about eh Fa i ne fire Looaed turers ey the Schuylki! {Lee eee as been completed, and the expense of rent % reduced there! The warehouse authorized-at dee jot be erected, as that d will: The $150,000 appropriated for that Warehouse have been remitted to the Treasury, ’ Of the debt of Southern railroads for material sold , therefore, | to them after the war, $4,627,695 remain unpaid. ‘The erection of a suitable building to accommo- partment is recommended as & measure of economy and efiicieucy, An appropriation uf $50,000 is asked for @ stock farm to sup} horses for the cavairy. No pel wi toc y ine for clothing or camp equipazge 1s re- juired. An increase of the number of assistant quar- of bonds should not be depressed by artificial pro- | termasters to Mitty is urgently recommended as ne~ cesses. If the seven-thirty notes were to be con- verted into five-twenty bonds it was equally impor- tant that they should sustain such relation to each other in regard to prices that etected. if bonds Were at a discount the notes would be presented for payment in legal tenders, and these could only be obtained by furtuer issues or the saie of some kind of securities, For three years, theretore, the state of the market has been a mat- ter of deep solicitude Wo the Secretary. Ii he had been indifferent to it, or failed carefully to study the imiuences that controied it, or had hesitated to exercise the power with waich Congress had clotned him, for sucessfully fanding the temporary dept by conversio: sales, he would have been false to his trust, ‘The task of converting thousand millions of temporary obliga- tions into @ funded debt, on a market constantly subject to natural and artificlat fuctuations, with- out depressing the prices of bonds and without dis- turbing the business of the country, however it may be regarded now, when the work has been accou plished, was, while it was being performed, an es ceedingly delicate one, '.1t is but sitinple justice to say, that its successful accomplishment isin a great measure atiribusabie to the judicious acuon of the Assistant Treasurer at New York, Mr. Van Dyck. Similar complaint has aiso been made of the man- her in which gold and bortds have been disposed of, = What has been styied “secret sales;” and ae cisely the same course has been pursued in thes sales that careful and prudent men pursue who sell on their own necount. The sales have bee made when currency was needed, and prices were sauefactory. It was not considered Wase or prudent to advise the dealers precisely when and to what amount sales were to be made (no sane man operating on lis owa account would tiave doue Lit), but ail waies of gold have been made im te open market, and of bonds by mis or the Assixtant Treasurer in New York, in the ordin: way, with a view of obtaining the very best pri and with the least poasibie disturbance of business, In the large transactions of the ‘Treasury, agents bave been indispensable, but pone have been em- ployed when the work could be done equally well by the officers of the department. Whether done by agents or officers, the Sevretary has no reason to suppose that it has not been done skilfully and honestly, a4 well as economically. He ia now gratified In being abio to say that unless a very stringent market, such as was produced a few weeks ago bY powertul combinations in New York, should send to the Treasury large amounts of the three per cent certificates for redemption, no further sales of bonds are likely to be necessary, Uatil, however, the receipts from internal revenues are increased, the necessities of the government will require that the sales of gold siiall be continued. These saies are now being made by advertisenients for seated bids, instead of the agencies heretofore ‘The resnit so far hus not been en ‘ but a proper respect for what, according to the tone of the press, appeared to be tie prblte sentiment, seemed to require it. The new mode wiil be fairly tested and contioued if {t can be Without @ sacrifice of the public interest, The Secretary has Wins referred to a fow potnts in his administration of the Treasury for the purpose ofexplaining some chings which may have been tu. ere, understood, and not for the purpose of de- lending his own action. Deeply seusivie of the responsibilities resttag upon him, but neither appalled nor disiearvened by them, he has per- formed the duties of his office according to Une best of his judgment and the lights whicu were before him, without deprecating criticism, and plainly and earnestly presented lis own views Without sevking peers favor. 1t has been hits good fortune to have ad for his immediate predecessors two of the abi st men in the Sounits 4o whose judicious kabors he been greatly indebted for any success that may it attended his administration of the Treasur, ne under less obligation to his associates, the oiicers and leading clerks of the departinent, Whose ability and whose devotion to the public servive aave com- mnanded his ot Arid adwiration, HUGH MCUULLOOG, Secretary of the Trearury. —_ to the proper administration of that depart- ment, , Attention is invited to the operation of the joint versions would be | resolution of March 30, 1868, by which the control of the appropriations for the War Department is taken. ina great measure, from the Secretary of War and vested in the accounting officers of the ‘Treasury, in: consequence of which large sums have been and are being paid from those appropriations contrary to the advice and opinion of the War Department. ‘ SUBSISTENCE DEPARTMENT. During the past year the supplies for the army have been mainly parchased in the large markets of the country, though the policy has been steadiastly, adhered to of purchasing near to the points of con- sumpti whenever and wherever the same could advantageously be done, The prospect of supplying: the troops in the Territories and on the Paciic in this manner is increasing and the subject is being diligently inquired into by the department. ‘The average cost of the army ration during the Year has been slightly above twenty-three cents, Tobacco to the monthly value $20,000 has been furnished the troops at cost prices. Subsistence to tue value of over $620,000 has been supjiied for the purposes of the Freedmen’s Bureau, and to the value of more than $370,000, for the sup- port of Indians—a large decrease m_ both instances. In setticment of the claims for commutatioh of ra~ tions of Union soldiers while prisoners of war $154,056 have boen expended, ” OW account of supplies taken for the use of the, army during the war claims to the amount of neurly| $3,000,000 have been received, of which nearly $200,000 have been allowed, $630,000 are awaiiing! decision and the baiance have ben rejected jor) various causes. The onicers of the subsistence department number twenty-nine, but accounts have been received from Ume to time during the year from over 800 different officers. The appointment of assistant commiasacies of subsistence from lieutenants of the line, with a trifiing increase of pay while so acting, is again re- commended, a8 is aisy the appointment Of post cou miesary sergeants, Measures lave been instituted for executing the Jaw abolishing tue odice o arty satier, by providing: a a idcrable variety of urticies sor sale to olllcers au en. There remains a large unexpended appropriation for this department which should be returned to the Treasury, and an appropriation made, of the suse hecossary for the NeXt Uscal year, MEDICAL, DEVARTMENT. No cases of the epidemic cholera or yellow fever which prevailed among the troops at tie date of the fd report have been reported during the presen’ es . One hundred and forty-six thousand one hundred VOR C Ig a average Ol turee tor the servive) reccivet medical treatment year ending June 40; 1965, oF whieh about vase, and the rest of i ad injuries. The total namber of deatis from ali causes was 1,621, of which about $8 percent, Was trom disease, and the the test from Wounds, injuries and ideals; 402 deaths were from yellow fever and from cholera. The dis- ehargés upon certiicate of disability number 1,074. apt of the army dusuag Uns period was Jes (ineluding five deaths) have oc- Mu corps, aad there are 49 vacans to of assistant surgeon, expenditures during the flees! year » #0) the balance on land wad yop tie 30th of June last. d curred inte up cies su tae gra The act ray DEPANEMENT, uents of the Pay Department dart been: 33 y or have: 7,803,009 aly the last ih For the regular army For the Military Acadel ys ‘To volunt ‘There are now in serviee CONTINUED ON BIGKTH PAGK,