lowed for funding the notes issued prior to the 1st of December, 1862, will, in the opinion of the Secretary, have the effect to withdraw from circulation nearly the entire sum issued previous to the last-named date. If to this be added a revenue from adequate taxation, and a negotiation of bonds guaranteed proportionately by the several States, as has already been generally proposed by some of them in enactments spontaneously adopted, there is little doubt that we shall see our finances restored to a sound and satisfactory condition, our circulation relieved of the redundancy now productive of so many mischiefs, and our credit placed on such a basis as to relieve us from further anxiety relative to our resources for the prosecution of the war.
It is true that at its close our debt will be large; but it will be due to our own people, and neither the interest nor the capital will be exported to distant countries, impoverishing ours for their benefit. On the return of peace the untold wealth which will spring from our soil will render the burden of taxation far less onerous than is now supposed, especially if we take into consideration that we shall then be free from the large and steady drain of our substance to which we were subjected in the late Union through the instrumentality of sectional legislation and protective tariffs.
I recommend to your earnest attention the whole report of the Secretary of the Treasury on this important subject, and trust that your legislation on it will be delayed no longer than may be required to enable your wisdom to devise the proper measures for insuring the accomplishment of the objects proposed.
The operations of the War Department have been in the main satisfactory. In the report of the Secretary, herewith submitted, will be found a summary of many memorable successes. They are with justice ascribed in large measure to the reorganization and reinforcement of our armies under the operation of the enactments for conscription. The wisdom and efficacy of these acts have been approved by results, and the like spirit of unity, endurance, and self-devotion in the people, which has hitherto sustained their action, must be relied on to assure their enforcement under the continuing necessities of our situation. The recommendations of the Secretary to this effect are tempered by suggestions for their amelioration, and the subject deserves the