France and Spain-Louisiana. landed in France, as they are in French ships. least double the whole commerce and number of The first advantage of this treaty would be, if seamen employed by France, and quadruple it immediately entered into, the saving to America with respect to her navigation with America. It twenty-five thousand seamen, who will, without should also be considered that this works doubly this encouragement go into the British service; in favor of France, 1st, So far as it is a direct adand thus increase not only her relative but her vantage to her maritime power; 2nd, So far as actual force: 2d. The sale of a number of her it subtracts from the navigation of England. ships to France, which will now become a dead The benefits that will result to the manufaecapital in her hands 3d. The preserving to the tures of France from this operation are incalcuUnited States their fisheries, which may be other-lable: 1st, The raw materials will be purchased wise greatly affected by the removal of their sea-on easy terms to the manufacturer; 2nd, The inmen to Britain. In these objects France has a tercourse that this system will establish between mutual advantage; and I will venture to say, that the two nations will make their fabrics known. she never acts more inconsistently with her own and render them fashionable in America; will interest, or more conformably with that of Brit-draw off their custom from England, whose fabries ain, than when, under the idea of raising a fish-will continue to be charged with a heavy duty, ery at home, while she has not seamen or ship- unless receding from her navigation act, she purping for her other branches of commerce, she en-chases an exemption. deavors to discourage the fisheries of America, which, from a variety of physical causes, can alone keep them from falling into the hands of the English. France should bear in mind, that, were her colonies as extensive as those of Britain; were her trade in Europe and America equal to hers; yet, for the reasons I have mentioned, arising from the geographical and physical situation of England and Ireland, she would not possess more than two-thirds of the number of seamen, these circumstances alone producing nearly as many as all the other trade of Britain. France can only increase her relative strength by dimin-stricted, will place her flag under such disadvanishing that of her rival, and keeping her from drawing from other sources new means of power. France may injure, and perhaps ruin, the whale fishery in America; but England only will profit by it. The first war will break up her establishments; and the Americans in her service will return with their wealth into their own country. Useful as this act may have been in its commencement, when the Dutch were the general carriers and rivals of Britain, and while the nations of Europe were ignorant of commercial principles, very enlightened statesmen now see many inconveniences in it to the general commerce of England; nor is there anything necessary to its entire overthrow, but for other nations to pass similar laws, so far as respect Britain, while their trade is put upon a liberal footing with regard to other nations. This, by promoting their own commerce of exchange, while that of Britain is re tages, that her own merchants will seek a foreign bottom when they have an operation that requires a circuitous voyage. This must ultimately, in spite of all her prejudices, compel her to repeal this selfish law, after having some time suffered under it. But while the navigation act exists in Britain, it will, under the circumstances of the treaty I suggest, operate as a bounty on the navigation and fabrics of France; because it is obvious that the freight and charge on any specific article carried in a ship that may make a circuitous voyage, is much less than they would be if part of the voyage was made in ballast. Thus, a French ship carrying a cargo of wine to America, taking in a load of tobacco, and returning from thence to Bordeaux, could take the wine on a much smaller freight than if the duties imposed in America on the importation of wine in a French ship should The interest that France will have in this treaty will be much more extensive: 1st, The raising up a new marine Power; 2d, Giving that Power such an interest in her prosperity, as must not only keep it from being inimical to, but, on the contrary, frequently connected with her in hostile operations; 3d, The transfer of ships to France; 4th, The increase of French seamen: for, as the wages of seamen are lower in France than in America, and must continue to be so, on account of the demand for men in a new country, while, on the other hand, ships, and the provisions for their out-be equivalent to the duties upon tobacco imported fit, are cheaper in America, French merchants, by fitting many of these vessels, and navigating them with French seamen, will be able to sail cheaper than the Americans themselves, and thus increase the number of their seamen. These seamen in case, of a war, will be drawn into the navy; while their places will be supplied, during the war, at somewhat more expense, by Americans, without injuring their commerce. In the cod fishery, France will derive clear and obvious advantages from the American ports for her out-circumstance of freight for the whole outward and fits, &c. But even these advantages will be inferior to that derived from the increase of the commerce of exchange, by that removal of restrictions; an operation which, I will venture to say, will at in an American ship into France; because, in that case, the French ship would go out empty for the tobacco, and the American ship empty for the wine; and the double freight and insurance must be charged on each of these articles. It should always be remembered, that whatever is saved in freight is a bounty upon agriculture and manufactures. But even this is a small advantage compared to that derived from the increase of adventures that will be occasioned by the very homeward voyage, and the consequent consump tion of the commodities of the country that encourages it. In this plan, Spain, (under some restrictions with regard to South America,) the Italian States, The Sinking Fund. and any others who should incline to engage it it, should be associated; without, however, delaying the project between France and the United States, lest they should lose, and Britain acquire, at this critical moment, that great body of seamen, who will, by the peace, be thrown out of employment. Were France to declare her determination to support this liberal system, such is her advantage in point of product and manufactures, that she could not fail to command the greatest foreign commerce of any nation in the world. The wealth arising from this source would be unbounded. But while her great capital is in the centre of the Republic, she never can have an extensive coasting trade; and she can only make up this deficiency, in a contest with Britain, by the increase of her wealth and credit; by nursing up new maritime nations; by which, if she adds little to her positive power, she adds much to her relative strength, in diminishing that of her rival. ly embrace them; and their mutual interest will lead them to protect them against the power of any maratime despot. The advantage that the vessels of this association would have over all others, could not fail to produce such a revolution in the principles and practice of commerce and navigation as would be highly interesting to humanity, honorable to the nations who should first adopt the system, and not unworthy of the enlarg. ed views of that distinguished statesman to whom Europe is already so much indebted, and who, alone, has sufficient power to carry it into effect. SINKING FUND. [Communicated to the Senate, Dec. 17, 1801.] CITY OF WASHINGTON, Dec. 16, 1801. The Commissioners of the Sinking Fund respectfully report to Congress as follows: That the measures which have been authorized by the board, subsequent to their report, of the 28th of November, 1800, so far as the same have been completed, are fully detailed in the report of the Secretary of the Treasury to this board, dated the 14th of the present month, and in the proceedings of the officers of the Treasury, therein referred to, which are herewith transmitted, and prayed to be received as part of this report. A. BALDWIN, Pres't Senate, pro tem. To cite a single instance: America can build and victual her whaling vessels much cheaper than either France or England, and of course afford oil cheaper; but if France excludes American oil from her market, she throws such a discouragement upon this fishery as will compel the whalers to seek another place of residence. In this case, though a few may be invited to France, the great bulk of them will go to England: First, because of their language, religion, and habits; and next, because they know that a war will ruin their establishments in France, and thus it will encourage those of Britain. The very companies established in France, at great national expense, will receive their oil at sea from English fishermen. Thus fifteen thousand men will be thrown into the scale of Britain, to support one thousand in the vain attempt to establish a fishery in France. This, however, is a small part of the loss. By the encouragement which France might give to the fisheries of the United States, she could destroy those of Brit-ports to the Commissioners of the Sinking Fund: ain; and, as the French ships that brought oil, or the American that brought French goods, would not go or return empty, a greater market would be created for French wines, brandies, &c. Let the loss upon this be calculated. The additional expense upon the first price to the inhabitants of France, and the countries given, they will find that they purchase their oil at a ruinous rate. Let the difference between fifteen thousand men, added to those employed in the British fishery, and eight thousand taken from them by the encourage ment given to the American fishery by France, making together the loss or gain of twenty-three thousand to Britain, be put in the scale with the comparatively few fishermen France can make, and she will form a fair estimate of the attempt, considering her as a rival power to Britain. Great as are the advantages proposed by this system to the commerce and navigation of France, they are small compared to those which she will derive from having opened a way to the establishment of free and liberal principles, that cannot fail to give room for the exertion of those talents and that industry for which her citizens are distinguished. Every nation, except one, will eager TREASURY DEPARTMENT, Dec. 14, 1801. States have been made, since the date of the last That the following sums have been applied to- 2d. To the payment of the ninth instalment of the subscription loan for bank stock, due on the last day of December, 1800 3d. To the payment of the first instalment of a loan of two million of guilders, obtained in Holland, and which fell due the present year, pursuant to a contract, dated the 9th of March, 1784, estimated at 40 cents per guilder 4th. To the payment of the fourth instalment of a loan of one million guilders, obtained in Holland, and which fell due in the present year, pursuant to a contract, dated the 1st of June, 1787, estimated at 40 cents per guilder 5th. To the payment of the third instalment of a loan of one million of guilders, obtained in Holland, and which fell due in the present year, pursuant to a contract, dated 13th March, 1788, estimated at 40 cents per guilder 6th. To the payment of the second instalment of a loan of three millions of guilders, obtained in Holland, and which fell due in the present year, pursuant to a contract, dated first of January, 1790, estimated at forty cents per guilder State of the Finances. 200,000 00 100,000 00 Making, in the whole, an equal amount to the reimbursements before mentioned. There remained in the hands of the Treasurer of the United States, as agent of the Board of Commissioners, on the twelfth day of the present month, four hundred and forty-nine thousand and sixty-nine dollars and thirty-one cents, which, 80,000 00 with the growing produce of other appropriated funds, will be sufficient for the reimbursement, at the close of the year, of the seventh instalment of the heretofore deferred stock, now bearing an interest of six per cent. and the tenth instalment of the subscription loan for stock of the Bank of the United States, which reimbursements are requir80,000 00 ed to be made by the 11th section of the act of Congress, passed on the 3d of March, 1795, herein before mentioned. All which is most respectfully submitted, by Amounting in the whole, to The payments before enumerated have been made out of the following funds: 1st. The interest on the sums which accrued upon the stock purchased, and transferred to the Commissioners of the Sinking Fund, in trust for the United States, as particularly stated in the document hereto annexed, (marked B) 2d. The fund arising from the payment of debts, which originated prior to the present Constitution of the United States, as particularly stated in the document hereunto annexed, (marked C) 2d. The funds arising from a dividend on the capital stock belonging to the United States, in the bank of said States, from 1st of July, to 31st December, 1799, after deducting the interest on the subscription loan for the same period, as particularly stated in the document hereunto annexed, (marked D) 4th. The proceeds of the duties on goods, wares and merchandisé, imported, on the tonnage of ships or vessels, and on spirits distilled within the United States, and stills, appropriated by the 8th sec $192,568 52 7,704 79 [Communicated to the Senate, Dec. 18th, 1801.] TREASURY DEPARTMENT, December 18, 1801. SIR: I have the honor to enclose a report prepared in obedience to the directions of the act supplementary to the act, entitled "An act to establish the Treasury Department. I have the honor to be, very respectfully, your obedient servant, ALBERT GALLATIN. Hon. PRESIDENT of the Senate. In obedience to the directions of the act supplementary to the act, entitled "An act to establish the Treasury Department." the Secretary of the Treasury submits the following report and estimates: The permanent revenues of the United States. according to the laws now in force, consist of, 1st. duties on merchandise and tonnage; 2d, internal duties on stills and domestic distilled spirits, re17,520 00 fined sugar, licenses to retailers, sales at auction and pleasurable carriages; 3d, proceeds of the sales of public lands; 4th, duties on postage; 5th, dividends on shares in the Bank of the United States; 6th, incidental, arising from fees, fines. and penalties, repayments in the Treasury, and sales of public property other than lands. State of the Finances. 1. Duties on merchandise and tonnage.-The receipts in the Treasury, arising from that source, have amounted, for the year ending on the 30th September, 1801, to $10,126,213 92. If to this sum be added the drawbacks paid by collectors on the exportation of domestic distilled spirits and refined sugar, which are a charge on the internal revenues; and that part of the additional duties, laid in the year 1800, which did not operate during the year to which those receipts refer, the sum which would have been received at the present rate of duties, cannot be estimated at less than $10,500,000. The amount of duties secured on the 30th September last, and falling due in the course of the year 1802, compared with that of preceding years, justifies an opinion, that, had the importations and exportations continued in the same proportion, those duties would have brought in the Treasury, during the year 1802, near $11,000,000. How far this branch of the revenue may be affected by the restoration of peace in Europe, is rather a subject of speculative conjecture than of calculation. That it will be liable to sudden and considerable fluctuations, cannot be doubted; and, for that reason, a greater degree of correctness may be obtained, by forming an estimate for a number of years, than for any one year. The period for which an estimate should be made, being arbitrary, so far as relates to the revenue, that of the eight years, 1802 to 1809, is selected, principally in reference to the payments to be made on account of the public debt-the whole of the foreign debt being actually due within that term of years, and the eight per cent. stock becoming redeemable the last year of the period. The best data on which the estimate may be predicated, seem to be the actual consumption of imported articles during former years, and the ratio of increase of population as ascertained by the census. With a view to the first object, the statements A to H have been abstracted from the records in the Treasury. They exhibit the value or quantities of imported articles on which duties have been actually paid, for each calendar year, from 1790 to 1800, deducting from the gross amount imported, each year, the value or quantities of articles re-exported during the same year, which were entitled to drawback. into two distinct periods; the first, from the 1st day of January, 1790, to the 31st day of December, 1792, includes the three years which immediately preceded the European maritime war; the second includes the six first years of that war, viz: from the commencement of 1793 to the close of 1798. In order to obtain a distinct view, for each of those two periods, of the annual average consumption of foreign articles, and of the annual average revenue which, at the rate of the present duties, would have accrued thereon, the table L has been prepared, which shows that the net annual revenue which would, at the present rate of duties, have accrued during each of those two periods, amounts, on an average, for the years 1790 to 1792, to $6,163,000; and for the years 1793 to 1798, to $8,350,000. These sums constitute not the receipts in the Treasury, but the revenue which would have accrued during the respective years to which they refer. The first may be considered as the revenue accruing during the year 1791; the last, as that accruing during the year ending 30th June, 1796; and as, on account of the credit given for the payment of duties, the revenue accruing during one year constitutes nearly the receipts of the year ending nine months later, those two sums, and the receipts of the year ending on the 30th of September, 1801, as above stated, may, without material error, be considered as the receipts of three distinct years, four years and a half distant from the other, viz: For the year ending 30th September, 1792 $6,163,000 For the year ending 30th March, 1797 8,350,000 For the year ending Sept. 30, 1801 - 10,500,000 The ratio of increase, during the whole period of nine years, exceeds seventy per cent., whilst that of population during the same time, was hardly more than thirty per cent. The ratio of increase, during the first period of four years and a half, is near 35 per cent., and, during the last, more than 25 per cent., whilst that of population, for each period, was only at the rate of fourteen per cent. The greater ratio of increase, during the first, than during the last period of four years and a half, is owing to the comparison in the first, being between a period of European peace and a period of European war; and, in the last, between the two periods of European war. Those statements do not, however, show correctly, principally for the last years, the actual annual amount of consumption; because, 1st, ex- The ratio of increase of population being asportations to a considerable, but not precisely certained, by the census, to be at the rate of 34 ascertained amount, have taken place, under such per cent. for ten years; if the increase of concircumstances as did not entitle the articles ex-sumption shall be supposed to be, hereafter, preported to a drawback; and 2d, the amount of foreign articles remaining on hand at the close of the year 1800, was much greater, in proportion to the respective population, than that on hand at the commencement of the year 1790. Those causes, which affect, to an inconsiderable degree, the years 1790 and 1792, and but partially those immediately succeeding, would, however, render any deduction drawn from those documents, in relation to the years 1799 and 1800, altogether fallacious. The preceding nine years may be divided cisely the same as that of population, the annual receipts of the eight years, 1802 to 1809, may be estimated at nearly fifty per cent. greater than those of the years 1790 to 1792, or at a sum of near $9.250,000, if that period be assumed as the basis on which to predicate the estimate. But if the calculation shall be grounded on the revenue of the years 1793 to 1798, the annual receipts of the years 1802 to 1809 should be estimated at about 30 per cent. greater than those of that period, or at about $10,900,000. State of the Finances. It seems that those two respective sums may reasonably be considered as the two extremes, which the average annual receipts of the eight ensuing years will not exceed. The first calculation, of $9,250,000, appears to be below the probable result; since, being predicated on the consumption of the three years preceding the European maritime war, without any other addition than that resulting from the ascertained increase of population, it rests on the supposition that the permanent wealth of the United States has not, during that war, increased in any greater proportion than their population; and that the whole of the external commerce acquired during the same period, must necessarily be lost by the return of peace amongst foreign nations. Although, therefore, it be presumable, that the receipts of some of those years will, from temporary causes, fall below that sum, it is believed that, taking the whole period of eight years, the duties on merchandise and tonnage may safely be averaged at a sum not less than $9,500,000. As a minute investigation of the several rates of duty, now paid by the several species of foreign merchandise, may perhaps suggest some advantageous modifications, a table of those rates is annexed to this report. Without any view to an increase of revenue, but in order to guard, as far as possible, against the value of goods being underrated in the invoices, it would be eligible to lay specific duties on all such articles now paying duties ad valorem, as may be susceptible of that alteration. Amongst such, the following have been suggested: fruits and spices, pickled and dried fish, oil, glue, several species of drugs, watches, gunpowder, and cigars. Legislative provisions seem necessary, in order better to define the restrictions under which the intercourse with the adjacent British and Spanish possessions shall be carried on, in conformity with treaties; under which the articles of the growth or manufacture of the United States may be imported free of duty, by the way of New Orleans, from the western parts of the Union, to the ports of the Atlantic States, and from these to the interior districts of collection on the Western waters, and under which drawbacks shall be allowed on the exportation of foreign articles. nue. 2. Permanent internal duties.-The annual statement, prepared by the Commissioner of the Revenue, and which will be completed in a few days, precludes the necessity of exhibiting here, all the details pertaining to this branch of reveThe statement M is an abstract of its amount, for the year 1800; during which, the duties on spirits and stills, refined sugars, licenses to retailers, sales at auction, and pleasurable carriages, produced a net sum of $576,888 80. The duties on stamps, which, as, under the existing laws they will cease after the 4th day of March, 1803, are not included amongst the permanent revenues, amounted, for the same year, to $209,853 32. Both together constitute an item of $786,742 12. The receipts in the Treasury from all the internal revenues, have amounted, for the year ending on the 30th September, 1801, to $919719 16. Deducting from this sum $65,000, being the estimated amount of drawbacks paid during that year, out of the proceeds of the external revenue, on the exportation of domestic distilled spirits and refined sugar, leaves a net sum of about $854,000, and an increase of near $70,000 beyond the revenue of 1800. The accounts of the last nine months being yet but partially rendered, it is not practicable to ascertain to what class of duties the increase belongs, nor particularly to discriminate between the increase of the revenue arising from stamps, and that of the permanent internal revenues. Yet it is believed that these, exclusively of the stamp duties, may safely be estimated, for the average of the years 1802-1809, at an annual sum not less than $650,000. In order, however, to secure that amount, a revision of the system, so far as it relates to country stills, is essentially necessary. Whilst the owners of small distilleries, in some parts of the Union, complain of the operation of a tax raised on the capacity of their stills, that same regulation has enabled those whose capitals are larger, and local situation more advantageous, especially in the Middle States, to reduce the actual duty on the quantity of spirits distilled from grain to about three cents per gallon. But improvements have lately been introduced, which, by accelerating the process of distillation, will, according to the estimate of the Commissioner of the Revenue, reduce the duty on stills to about three-fifths of a cent per gallon of spirits distilled. The effect of these, on the revenue, has already been sensibly felt, in one of the most productive districts of the United States; and, unless it shall be counteracted, either by restricting laws, or by an increase of the duty on the capacity of the stills, or by a change of the subject of taxation, a considerable defalcation must be expected. Whatever mode may be adopted, it is respectfully submitted whether the revenue may not be benefited, and just grounds of complaint removed, by a repeal or modification of the clause which compels a yearly entry of stills, in the month of June, under a penalty of $250, by a permission to persons who take short licenses, to continue distilling beyond the time limited in their licenses, on paying a proportionate duty; and by reducing into one act all the laws in relation to duties on stills and domestic distilled spirits. It will appear, by the same statement M. that, whilst the expenses of collection on merchandise and tonnage, which are defrayed out of the reve nue, do not exceed 4 per cent., those on the permanent internal duties amount to almost 20 per cent. This, however, is an inconvenience, which on account of the greater number of individuals on whom the duties are raised, and of their dispersed situation throughout the whole extent of the United States, must, more or less, attach to the system of internal taxation, so long as the wants of Government shall not require any considerable exten sion, and the total amount of revenue shall remain inconsiderable. |