and territories to be respected, not only by our citizens, but by foreigners who have resorted to the United States for the purpose of organizing hostile expeditions against some of the States of that republic. The defenceless condition in which its frontiers have been left has stimulated lawless adventurers to embark in these enterprises, and greatly increased the difficulty of enforcing our obligations of neutrality. Regarding it as my solemn duty to fulfil, efficiently, these obligations, not only towards Mexico, but other foreign nations, I have exerted all the powers with which I am invested to defeat such proceedings, and bring to punishment those who, by taking a part therein, violated our laws. The energy and activity of our civil and military authorities have frustrated the designs of those who meditated expeditions of this character, except in two instances. One of these, composed of foreigners, was at first countenanced and aided by the Mexican government itself, it having been deceived as to their real object. The other, small in number, eluded the vigilance of the magistrates at San Francisco, and succeeded in reaching the Mexican territories; but the effective measures taken by this government compelled the abandonment of the undertaking.

The commission to establish the new line between the United States and Mexico, according to the provisions of the treaty of the 30th of December last, has been organized, and the work is already commenced.

Our treaties with the Argentine Confederation, and with the republics of Uruguay and Paraguay, secure to us the free navigation of the river La Plata, and some of its larger tributaries; but the same success has not attended our endeavors to open the Amazon. The reasons in favor of the free use of that river I had occasion to present fully, in a former message; and, considering the cordial relations which have long existed between this government and Brazil, it may be expected that pending negotiations will eventually reach a favorable result.

Convenient means of transit between the several parts of a country are not only desirable for the objects of commercial and personal communication, but essential to its existence under one government. Separated as are the Atlantic and Pacific coasts of the United States by the whole breadth of the continent, still the inhabitants of each are closely bound together by community of origin and institutions, and by strong attachment to the Union. Hence the constant and increasing intercourse, and vast interchange of commercial productions, between these remote divisions of the Republic. At the present time, the most practicable and only commodious routes for communication between them are by the way of the Isthmus of Central America. It is the duty of the government to secure these avenues against all danger of interruption.

In relation to Central America, perplexing questions existed between the United States and Great Britain at the time of the cession of California. These, as well as questions which subsequently arose concerning inter-oceanic communication across the Isthmus, were, as it was supposed, adjusted by the treaty of April 19, 1850: but, unfortunately, they have been re-opened by serious misunderstanding as to the import of some of its provisions, a re-adjustment of which is now

under consideration. Our minister at London has made strenuous efforts to accomplish this desirable object, but has not yet found it possible to bring the negotiations to a termination.

As incidental to these questions, I deem it proper to notice an occurrence which happened in Central America, near the close of the last session of Congress. So soon as the necessity was perceived of establishing inter-oceanic communications across the Isthmus, a company was organized, under authority of the State of Nicaragua, but composed, for the most part, of citizens of the United States, for the purpose of opening such a transit way, by the river San Juan and Lake Nicaragua, which soon became an eligible and much-used route in the transportation of our citizens and their property between the Atlantic and Pacific. Meanwhile, and in anticipation of the completion and importance of this transit way, a number of adventurers had taken possession of the old Spanish port at the mouth of the river San Juan, in open defiance of the State or States of Central America, which, upon their becoming independent, had rightfully succeeded to the local sovereignty and jurisdiction of Spain. These adventurers undertook to change the name of the place from San Juan del Norte to Greytown, and, though at first pretending to act as the subjects of the fictitious sovereign of the Mosquito Indians, they subsequently repudiated the control of any power whatever, assumed to adopt a distinct political organization, and declared themselves an independent sovereign state. If, at some time, a faint hope was entertained that they might become a stable and respectable community, that hope soon vanished. They proceeded to assert unfounded claims to civil jurisdiction over Punta Arenas, a position on the opposite side of the river San Juan, which was in possession, under a title wholly independent of them, of citizens of the United States interested in the Nicaragua Transit Company, and which was indispensably necessary to the prosperous operation of that route across the Isthmus. The company resisted their groundless claims; whereupon they proceeded to destroy some of its buildings, and attempted violently to dispossess it.

At a later period they organized a strong force for the purpose of demolishing the establishment at Punta Arenas, but this mischievous design was defeated by the interposition of one of our ships of war, at that time in the harbor of San Juan. Subsequently to this, in May last, a body of men from Greytown crossed over to Punta Arenas, arrogating authority to arrest, on the charge of murder, a captain of one of the steamboats of the Transit Company. Being well aware that the claim to exercise jurisdiction there would be resisted then, as it had been on previous occasions, they went prepared to assert it by force of arms. Our minister to Central America happened to be present on that occasion. Believing that the captain of the steamboat was innocent, for he witnessed the transaction on which the charge was founded, and believing, also, that the intruding party, having no jurisdiction over the place where they proposed to make the arrest, would encounter desperate resistance if they persisted in their purpose, he interposed, effectually, to prevent violence and bloodshed. The American minister afterwards visited Greytown, and whilst he was

there, a mob, including certain of the so-called public functionaries of the place, surrounded the house in which he was, avowing that they had come to arrest him, by order of some person exercising the chief authority. While parleying with them he was wounded by a missile from the crowd. A boat, despatched from the American steamer "Northern Light" to release him from the perilous situation in which he was understood to be, was fired into by the town guard, and compelled to return. These incidents, together with the known character of the population of Greytown, and their excited state, induced just apprehensions that the lives and property of our citizens at Punta Arenas would be in imminent danger after the departure of the steamer, with her passengers, for New York, unless a guard was left for their protection. For this purpose, and in order to insure the safety of passengers and property passing over the route, a temporary force was organized, at considerable expense to the United States, for which provision was made at the last session of Congress.

This pretended community, a heterogeneous assemblage gathered from various countries, and composed, for the most part, of blacks and persons of mixed blood, had previously given other indications of mischievous and dangerous propensities. Early in the same month, property was clandestinely abstracted from the depot of the Transit Company, and taken to Greytown. The plunderers obtained shelter there, and their pursuers were driven back by its people, who not only protected the wrong-doers and shared the plunder, but treated with rudeness and violence those who sought to recover their property.

Such, in substance, are the facts submitted to my consideration, and proved by trustworthy evidence. I could not doubt that the case demanded the interposition of this government. Justice required that reparation should be made for so many and such gross wrongs, and that a course of insolence and plunder, tending directly to the insecurity of the lives of numerous travellers, and of the rich treasure belonging to our citizens, passing over this transit way, should be peremptorily arrested. Whatever it might be in other respects, the community in question, in power to do mischief, was not despicable. It was well provided with ordnance, small arms, and ammunition, and might easily seize on the unarmed boats, freighted with millions of property, which passed almost daily within its reach. It did not profess to belong to any regular government, and had, in fact, no recognized dependence on, or connection with, any one to which the United States or their injured citizens might apply for redress, or which could be held responsible, in any way, for the outrages committed. Not standing before the world in the attitude of an organized political society, being neither competent to exercise the rights nor to discharge the obligations of a government, it was, in fact, a marauding establishment, too dangerous to be disregarded, and too guilty to pass unpunished, and yet incapable of being treated in any other way than as a piratical resort of outlaws, or a camp of savages, depredating on emigrant trains or caravans and the frontier settlements of civilized states.

Seasonable notice was given to the people of Greytown that this government required them to repair the injuries they had done to our

citizens, and to make suitable apology for their insult of our minister, and that a ship-of-war would be despatched thither to enforce compliance with these demands. But the notice passed unheeded. Thereupon, a commander of the navy, in charge of the sloop-of-war "Cyane," was ordered to repeat the demands, and to insist upon a compliance therewith. Finding that neither the populace, nor those assuming to have authority over them, manifested any disposition to make the required reparation, or even to offer excuse for their conduct, he warned them, by a public proclamation, that if they did not give satisfaction within a time specified, he would bombard the town. By this procedure he afforded them opportunity to provide for their personal safety. To those also who desired to avoid loss of property, in the punishment about to be inflicted on the offending town, he furnished the means of removing their effects, by the boats of his own ship, and of a steamer which he procured and tendered to them for that purpose. At length, perceiving no disposition on the part of the town to comply with his requisitions, he appealed to the commander of her Britannic Majesty's schooner "Bermuda,' who was seen to have intercourse, and apparently much influence with the leaders among them, to interpose, and persuade them to take some course calculated to save the necessity of resorting to the extreme measure indicated in his proclamation; but that officer, instead of acceding to the request, did nothing more than to protest against the contemplated bombardment. No steps of any sort were taken by the people to give the satisfaction required. No individuals, if any there were, who regarded themselves as not responsible for the misconduct of the community, adopted any means to separate themselves from the fate of the guilty. The several charges, on which the demands for redress were founded, had been publicly known to all for some time, and were again announced to them. They did not deny any of these charges; they offered no explanation, nothing in extenuation of their conduct; but contumaciously refused to hold any intercourse with the commander of the "Cyane. By their obstinate silence they seemed rather desirous to provoke chastisement than to escape it. There is ample reason to believe that this conduct of wanton defiance, on their part, is imputable chiefly to the delusive idea that the American government would be deterred from punishing them, through fear of displeasing a formidable foreign power, which, they presumed to think, looked with complacency upon their aggressive and insulting deportment towards the United States. The Cyane" at length fired upon the town. Before much injury had been done, the fire was twice suspended, in order to afford opportunity for an arrangement; but this was declined. Most of the buildings of the place, of little value generally, were, in the sequel, destroyed; but, owing to the considerate precautions taken by our naval commander, there was no destruction of life.

When the "Cyane" was ordered to Central America, it was confidently hoped and expected that no occasion would arise for "a resort to violence and destruction of property and loss of life." Instructions to that effect were given to her commander. And no extreme act would have been requisite had not the people themselves, by their extraordinary conduct in the affair, frus

trated all the possible mild measures for obtaining satisfaction. A withdrawal from the place, the object of his visit entirely defeated, would, under the circumstances in which the commander of the Cyane. found himself, have been absolute abandonment of all claim of our citizens for indemnification, and submissive acquiescence in national indignity. It would have encouraged in these lawless men a spirit of insolence and rapine most dangerous to the lives and property of our citizens at Punta Arenas, and probably emboldened them to grasp at the treasures and valuable merchandise continually passing over the Nacaragua route. It certainly would have been most satisfactory to me if the objects of the "Cyane's" mission could have been consummated without any act of public force; but the arrogant contumacy of the offenders rendered it impossible to avoid the alternative, either to break up their establishment, or to leave them impressed with the idea that they might persevere with impunity in. a career of insolence and plunder.

This transaction has been the subject of complaint on the part of some foreign powers, and has been characterized with more of harshness. than of justice. If comparisons were to be instituted, it would not be difficult to present repeated instances in the history of states, standing in the very front of modern civilization, where communities, far less offending and more defenceless than Greytown, have been chastised with much greater severity, and where not cities only have been laid in ruins, but human life has been recklessly sacrificed, and the blood of the innocent made profusely to mingle with that of the guilty.

Passing from foreign to domestic affairs, your attention is naturally directed to the financial condition of the country, always a subject of general interest. For complete and exact information regarding the finances, and the various branches of the public service connected therewith, I refer you to the report of the Secretary of the Treasury; from which it will appear, that the amount of revenue during the last fiscal year, from all sources, was seventy-three million five hundred and forty-nine thousand seven hundred and five dollars; and that the public expenditures for the same period, exclusive of payments on account of the public debt, amounted to fifty-one million eighteen thousand two hundred and forty-nine dollars. During the same period, the payments made in redemption of the public debt, including interest and premium, amounted to twenty-four million three hundred and thirty-six thousand three hundred and eighty dollars. To the sum total of the receipts of that year is to be added a balance remaining in the Treasury at the commencement thereof, amounting to twenty-one million nine hundred and fortytwo thousand eight hundred and ninety-two dollars; and at the close of the same year, a corresponding balance, amounting to twenty million one hundred and thirty-seven thousand nine hundred and sixtyseven dollars of receipts above expenditures, also remained in the Treasury. Although, in the opinion of the Secretary of the Treasury, the receipts of the current fiscal year are not likely to equal in amount those of the last, yet they will undoubtedly exceed the amount of expenditures by at least fifteen millions of dollars. I shall, therefore, continue to direct that the surplus revenue be applied, so far as it can be judiciously and economically done, to the reduction of the public debt,