proposed, it is estimated, will be sufficient to cover the
necessary expenditures both for the war and for all other purposes up
to the 30th of June, 1848, and an amount of this loan not exceeding
one-half may be required during the present fiscal year, and the greater
part of the remainder during the first half of the fiscal year
succeeding.

In order that timely notice may be given and proper measures taken to
effect the loan, or such portion of it as may be required, it is
important that the authority of Congress to make it be given at an early
period of your present session. It is suggested that the loan should be
contracted for a period of twenty years, with authority to purchase the
stock and pay it off at an earlier period at its market value out of any
surplus which may at any time be in the Treasury applicable to that
purpose. After the establishment of peace with Mexico, it is supposed
that a considerable surplus will exist, and that the debt may be
extinguished in a much shorter period than that for which it may be
contracted. The period of twenty years, as that for which the proposed
loan may be contracted, in preference to a shorter period, is suggested,
because all experience, both at home and abroad, has shown that loans
are effected upon much better terms upon long time than when they are
reimbursable at short dates.

Necessary as this measure is to sustain the honor and the interests of
the country engaged in a foreign war, it is not doubted but that
Congress will promptly authorize it.

The balance in the Treasury on the 1st July last exceeded $9,000,000,
notwithstanding considerable expenditures had been made for the war
during the months of May and June preceding. But for the war the whole
public debt could and would have been extinguished within a short
period; and it was a part of my settled policy to do so, and thus
relieve the people from its burden and place the Government in a
position which would enable it to reduce the public expenditures to that
economical standard which is most consistent with the general welfare
and the pure and wholesome progress of our institutions.

Among our just causes of complaint against Mexico arising out of her
refusal to treat for peace, as well before as since the war so unjustly
commenced on her part, are the extraordinary expenditures in which we
have been involved. Justice to our own people will make it proper that
Mexico should be held responsible for t