STATEMENT F-Continued.

REPORT ON THE FINANCES.

JUNE, 1813.

In obedience to the act, supplementary to the act, entitled "An act to es tablish the Treasury Department," the Acting Secretary of the Treasury respectfully submits the following report.

The receipts into the Treasury, from the 1st of October,

1812, to the 31st March, 1813, have amounted to The balance in the Treasury, on the 30th September, 1812,

was

Making together,

The expenditures, from the 1st October, 1812, to the 31st
March, 1813, have amounted to

Leaving a balance in the Treasury, on the Ist of April,
1813, of

$15,412,416 25

2,362,652 69

$ 17,775,068 94

$15,919, 334 41

- 1,855,734 53

$17,775,068 94

The enclosed Statement (A.) shows, in detail, the several sources from which the receipts were derived, and the branches of expenditure to which the disbursements from the Treasury were applied.

Pursuant to the act of Sth February last, subscriptions for a loan of sixteen millions of dollars, were opened on the 12th, and again on the 25th of March last. But, although a thirteen years' annuity of one per cent. was offered, in addition to a six per cent. stock at par, for the money which might be subscribed, it being apparent, from the result of the first subscription, that the whole amount could not be obtained on those terms, proposals in writing were invited. Offers, exceeding by about a million of dollars the amount wanted, were received, some demanding a thirteen years' annuity of one and a half per cent, in addition to six per cent. stock at par, but most of them requiring a six per cent, stock, at the rate of 88 per cent. On these terms, leaving to the subscribers the option, the loan was effected.

In conformity with the public notification, the same terms were extended to those persons who had subscribed on the first opening of the subscription, and they have the same option; which, if the stock at the rate of 88 per cent, be taken, is equivalent, precisely, to a premium of thirteen dollars sixty-three cents and seven-elevenths of a cent, for each hundred dollars loaned to the government.

The enclosed papers, under the letter B, are copies of the several public notices given on the subject, and a statement of the moneys respectively obtained by open subscriptions, and by written proposals, and showing also, the sums obtained and payable in each place where subscriptions were opened. Of that sum of sixteen millions of dollars, thus obtained on loan, there was paid into the Treasury, prior to the 1st of April, 1813, the sum of

1,086,737 50, which makes a part of the moneys received previously to that day, as stated in the statement A.

The resources for the residue of the year 1813, consist of the following items, viz:

1. The remainder of the loan above-mentioned,
2. The sums payable on account of customs, and of the

sales of public lands, estimated at

3. The five millions of dollars in Treasury Notes, authorized by the act of February 25th, 1813,

5,000,000 00

Say $29,230,000 00

The expenses for the last nine months of the present year, are calculated as followeth, viz:

1. Civil list, and all expenses of a civil nature, both foreign and domestic,

2. Payments on account of the principal and interest of the public debt, as per estimate C, herewith

3. Expenses on account of the War and Navy Departments,

$900,000 00

10,510,000 00 17,820,000 00

$29,230,000 00

Of the sum of $1,855,734 53, remaining in the Treasury on the 1st of April last, a small part may be considered as applicable to such extraordinary expenses, already authorized, as may arise during the remainder of the year; and for the same object, the sum of 1,000,000 of dollars, authorized by an act of the State of Pennsylvania, to be loaned to the United States, but which was not offered in time to be accepted as a part of the loan of sixteen millions, may be considered as a resource.

In this estimate, the whole sum of five millions of dollars, authorized to be issued in Treasury Notes, is taken as a part of the resources of the present year. But, as it is not deemed eligible to increase the amount of Treasury Notes in circulation, and as three millions only, of those authorized by the act of 1812, were issued in that year, and are reimbursable in the course of the present year, it is respectfully suggested, that in lieu of issuing two millions of the five millions authorized by the act of February, 1813, Congress should authorize an additional loan for the same amount; it being made a condition of such loan, that its terms should not be higher than those of the loan of sixteen millions, already effected.

The provision already considered, is for the service of the present year only; that which will be necessary for the year 1814, requires an early attention. It is difficult to estimate, with accuracy, the sum which will be received into the Treasury from the revenue as now established.

During a state of war, the customs, at the present rate of duties, have been heretofore estimated to produce five millions of dollars. The additional tonnage duty, imposed upon foreign vessels, by the act of 1st July, 1812, producing about 200,000 dollars a year, is not included in that sum.

It is believed, that during the year 1814, a greater sum than five millions two hundred thousand dollars, ought not to be relied upon, as receivable into the Treasury, from custom-house duties. The sum arising from sales of public lands, may be estimated at six hundred thousand dollars, making together 5,800,000 dollars. The interest alone, on the public funded debt, on temporary loans, and on the Treasury Notes, which will become payable

1

:

in that year, will amount to four millions four hundred thousand dollars. The other engagements, on account of the principal of the funded debt, of temporary loans, and of Treasury Notes, which will become reimbursable in that year, amount to 7,150,000 dollars; exceeding, together, by more than five millions seven hundred thousand dollars, the estimated amount of the receipts into the Treasury, derived from the revenue as now established.

This view of the subject is sufficient to evince the necessity of a speedy and effectual provision for the service of that and the ensuing years. The mode and the extent to which this provision should be carried, have been heretofore suggested, from this Department to Congress, and have received the consideration of that body.

The expenses of the Peace Establishment of the United States, and the interest on the public debt, including that on the loans made for the prosecution of the war, are believed to be the least sums that ought, under any circumstances, to be raised within each year. These, if the expenses of the Peace Establishment are taken at the sum necessary for the ordinary expenditure of the United States, previously to the additional armaments made in the year 1812, with a view to an approaching state of war, and including the interest on the loans of the year 1812 and 1813; and also of that which will probably be necessary in the year 1814, will amount, during that year, to eleven millions four hundred thousand dollars, viz:

The expense of the Peace Establishment, exclusive of the additional force authorized by the acts passed during the year 1812, may be estimated $7,000,000

at

The interest on the public debt, during the year 1814, will be
as follows:

On old funded debt

On 6 per cent stock of 1812, including temporary
loans, received in part of the loan of eleven
millions, which will remain unpaid in 1814,

$2,100,000

On 6 per cent. stock of 1813,

500,000 1,090,000

On Treasury Notes, which will be reimbursable in
1814, say on 5,000,000 dollars, at 5 per cent.

270,000

3,960,000

On the loan for the year 1814, interest payable
within that year

440,000

$11,400,000

The revenue, as now established, being estimated to produce $5,800,000
Would leave to be raised

To cover the above sum of

5,600,000

$11,400,000

The internal taxes heretofore proposed, were estimated to
produce

And the duty of 20 cents a bushel on salt imported, which,
though estimated heretofore at only 400,000 dollars a year,
during a state of war, yet, as the consumption considerably
exceeds 2,000,000 of bushels, may be estimated to produce

$5,000,000

600,000

$5,600,000

Although the taxes, if early laid, may be brought into operation in the commencement of the year 1814, yet as they cannot be expected to have their full effect during that year, some auxiliary resource will be required. This may be found in the sum of 1,500,000 dollars, which is the excess of the Sinking Fund for the present year, over the demands on that fund, according to the existing engagements of the United States. This sum of 1,500,000 dollars, may be carried to the Sinking Fund, for the year 1814, and will be wanted, in addition to the annual appropriation of 8,000,000 of dollars, to meet the engagements on account of the public debt, which must be fulfilled during that year.

As reliance must be had upon a loan, for the war expenses of the year 1814, the laying of the internal taxes may be considered, with a view to that object, as essentially necessary: in the first place, to facilitate the obtaining of the loan; and secondly, for procuring it on favorable terms.

It is ascertained that the terms of the loan, for the present year, would have been more favorable, if the taxes had been previously laid; and it is obvious enough, that by affording a security for the regular payment of the interest, and the eventual reimbursement of the principal, more stable, and less liable to be weakened or cut off by the natural effects of war, upon external commerce, than a revenue, depending as that of the United States now does, almost wholly upon such external commerce. Capitalists will advance with the greater readiness, and at a lower rate of interest, the funds necessary for the prosecution of the war; public confidence will be ensured, and the means afforded, of preserving the public credit unimpaired: a measure of the utmost importance, in a country like ours, where, from the lightness of the demands made upon the people, during the continuance of peace, the extraordinary expenses of a state of war can be supplied only by a resort. to that credit.

The resources of the country are ample, and if the means now proposed, and those heretofore recommended from this Department, are adopted, it is believed they may be fairly and fully brought into action.

All which is respectfully submitted.

W. JONES, Acting Secretary

TREASURY DEPARTMENT, June 2d, 1813.

of the Treasury.