annual expenditure has been
increased by the act of the last session of Congress providing for
Revolutionary pensions to an amount about equal to the proceeds of the
internal duties which were then repealed, the revenue for the ensuing
year will be proportionally augmented, and that whilst the public
expenditure will probably remain stationary, each successive year will
add to the national resources by the ordinary increase of our population
and by the gradual development of our latent sources of national
prosperity.

The strict execution of the revenue laws, resulting principally from
the salutary provisions of the act of the 20th of April last amending
the several collection laws, has, it is presumed, secured to domestic
manufactures all the relief that can be derived from the duties which
have been imposed upon foreign merchandise for their protection. Under
the influence of this relief several branches of this important national
interest have assumed greater activity, and although it is hoped that
others will gradually revive and ultimately triumph over every obstacle,
yet the expediency of granting further protection is submitted to your
consideration.

The measures of defense authorized by existing laws have been pursued
with the zeal and activity due to so important an object, and with all
the dispatch practicable in so extensive and great an undertaking. The
survey of our maritime and inland frontiers has been continued, and at
the points where it was decided to erect fortifications the work has
been commenced, and in some instances considerable progress has been
made. In compliance with resolutions of the last session, the Board of
Commissioners were directed to examine in a particular manner the parts
of the coast therein designated and to report their opinion of the
most suitable sites for two naval depots. This work is in a train of
execution. The opinion of the Board on this subject, with a plan of all
the works necessary to a general system of defense so far as it has been
formed, will be laid before Congress in a report from the proper
department as soon as it can be prepared.

In conformity with the appropriations of the last session, treaties have
been formed with the Quapaw tribe of Indians, inhabiting the country on
the Arkansaw, and with the Great and Little Osages north of the White
River; with the tribes in the State of Indiana; with the several tribes
within the State of Ohio and the Michigan T