for peace having failed, the important
questions arise, in what manner the war ought to be prosecuted and what
should be our future policy. I can not doubt that we should secure and
render available the conquests which we have already made, and that with
this view we should hold and occupy by our naval and military forces all
the ports, towns, cities, and Provinces now in our occupation or which
may hereafter fall into our possession; that we should press forward our
military operations and levy such military contributions on the enemy as
may, as far as practicable, defray the future expenses of the war.

Had the Government of Mexico acceded to the equitable and liberal terms
proposed, that mode of adjustment would have been preferred. Mexico
having declined to do this and failed to offer any other terms which
could be accepted by the United States, the national honor, no less than
the public interests, requires that the war should be prosecuted with
increased energy and power until a just and satisfactory peace can be
obtained. In the meantime, as Mexico refuses all indemnity, we should
adopt measures to indemnify ourselves by appropriating permanently a
portion of her territory. Early after the commencement of the war New
Mexico and the Californias were taken possession of by our forces. Our
military and naval commanders were ordered to conquer and hold them,
subject to be disposed of by a treaty of peace.

These Provinces are now in our undisputed occupation, and have been so
for many months, all resistance on the part of Mexico having ceased
within their limits. I am satisfied that they should never be
surrendered to Mexico. Should Congress concur with me in this opinion,
and that they should be retained by the United States as indemnity, I
can perceive no good reason why the civil jurisdiction and laws of the
United States should not at once be extended over them. To wait for a
treaty of peace such as we are willing to make, by which our relations
toward them would not be changed, can not be good policy; whilst our own
interest and that of the people inhabiting them require that a stable,
responsible, and free government under our authority should as soon as
possible be established over them. Should Congress, therefore, determine
to hold these Provinces permanently, and that they shall hereafter be
considered as constituent parts of our country, the early establishment
of Territorial governments over them will be i