I lay before Congress copies of a Treatv oÃ peace, friendsliip, limits and seltlement between thc United States and the Mexican Repubhc, the ratifications of whicb were duly exchanged at the city Queretaro, Ãn Mexico, on the 30th day of May, 1S48. The war in which our country was reluctantly involved in the necessary vindication of the national rights and honor, has been thu terminated, and I congratÃºlate Congress and our cornmon constituems upon the restoration of an honorable peace. The extensive and valuable territoties ceded by Mexico to the Uniled States, constante indomnity forllip past, and tlie brilliant achievet. ments and signal succestmfli a guaranty of secuiity forTnenratiÃn?, by convincing all nations lliat our rights must be respected. The resnlts of tlie w ir u iili Mexico have given lo the United States a national cliaracter abroad which our country liever enjoyed. Our power and our resources have becomo known and respecied throughout the world, and we shall probably be saved frorrr the necessity of engaging in another foreigu war, for a long series oi'years. It is a subject of congratularon, that we have passed through a war of more than two years duration, witli the business of the country uninterrupted, with our resources unexhausted, and the public credit unimpaired. I send for the nformation of Congress, the accompanying documents and correspondence, relating to the negotiation and ratification of the Treaty. Before the Treaty can bo fully executed on the part of the United States, legislation will be required. It will be proper to make the necessary appropriations i'or the payment of the $12,000,000, stipulated by the tStb article to be paid to Mexico in four equal annuÃ¼l instalments. - Three milhons of dollars were appropriated bv the act of March 3d, 1S47, and that sum was paid to the Mexican government after the rctÃ¯fication of the Treaty. The 5ih article of the Treaty provides that, " in order to designale tlie boundary line with due precisiÃ³n, upon the maps, and to establish upoB the ground, landmarks which shall show the limits of both Itepubhcs, as described in the present article. the two governments shall each appoint. a commiseioner and a surveyor, who, before the expiration of one year from the date of the exchange and ratih'cution of tliis Treaty, sha'l meet at the port of San Diego, and proceed, and run, and mark tlie suid boundary in lts vvhole course to the inouth of the Rio L;ravo del Norte." It will be necessary that sucli provisiÃ³n sliall be made by law for die appointment of a com mtasioner and surveyoron tho pany of the U. States to act in conjunction with a tommissioner nv.d surveyor ippoinled by Mexico, in exeenting the stipulation of' lliis article. It will be proper also to provide by law tor tlie appoint metil of' a board of coiumissioners, to adjudicate and decide upon all 'laims ol'our citizens agamstthe Mexican government, which by the Treaty have been awumed bv tiic II. States. New Mexico and Upper California have been ceded by Mexico to the United States, and now constituÃa a part of oor country. Embracing nearly ten degres of lutitudc, I ving adjacent to the Oregon TeTÃtory, and extending from the Pacilic to the Ivio Grande - a mean distance of' nearly 1,000 miles, it would be tlÃ¼ticult to estimale the value of thae possessions to the United Staties. Tliey conslitute a country largn enough lor a great empire. # Rich in triinerul and agncultunil resources, with a climate of great salubrity, thoy embracn tlie most important porti on the l'acilic COasL The possession of tho ports o!' .San Diego and the Bay of' San frtnotftoo will ena'Ule lk U. States to command the entire om mn.v il the PaciKc. The avraber of oor whala ship employed in tliat sea axceed wven hunJred ; rcqoinog now more tlian 20.000 seamen to navigate Ã¼iem - while the capital invated in this particular branch af â i tÃ©d ut no: less than our flag, aftord security and repose to our cornmerciiil marine - and American mechanics vi!l soon fafriiih ready mean of hip building and repair, which are now so much wanted in that li'Stant sea. y the acquisition of these possessions wc are brought into immediale proximtty with the West coast of America, Oom Cape Horn to theRussian possessions Nortli ofOregon ; wilh the Islands of the Pacific ocean ; and by a direct voyage in teamers, vo wM! be in less than ihirty days of CantÃ³n and other ports of China. Tn this vast regiÃ³n, whose rich resources are soon to be developed by American energy and enterprise, great must be the augmentation of our commerce ; and with it new and profitablc demands for mechanic labor in all its branches, and new and valuable markets for our man factures and agricultural producÃs. While the war has been conducted with great humanity and forbearance, and with complete success on our part, the peace has been con cludeil on terms the mo3t liberal and magnanimous to Mexieo. In her hands the terntory now ceded has remained, and it is believed, wou'.d have continued to remain almost unoccupied, and of littlo value to her or to any nation - whiljt as a part of our Union they wijl b-e productive of vast benefils to the U. States. fo the commercial world, and to the general interests of mankind. The immediate estabHshment of Territorial Government, and the extensiÃ³n of our hand over these valuable possessions, are deemed to be not only imporlant, but indispensable to pre serve order and the due administration of justice within their limits, to aiÃ¯brd protection to the iohabitants, and to f'acilitate the vast resources and wealth which their acquisition has added to the country. The war with Mexico, having terminated, the power of thu Executive to establish or continue temporary civil governtnentl on these territories, which cxisled under the laws of nations, whilst they werc regarded as conquered provinees in our mililary occupation, has ceascd. By their cession to the United States, Mexico has no longer any power over them, and until Congress shall act, the inhaliitants wil] be without any organized government. Should they be left in this condition, confusiÃ³n and anarchy will be likely to prevail. Foreign commerce, lo a considerable exlent, s now carried on in the ports of Upper California, which will require to be rogulated by our laws. As soon as our systcm shall be extended over this commerce a revenuo of considerable amount will be at once collected, and it is not doubted that it will be. In organizing goverrments over these terrilories, fraught with such vast advantages to evcry portion of our Union, I invoke that spirit of concession, concilliation and compromiso in your deliberations, in which the Constitut.ion was passed ; in which it should be administered, and which is so indispensable to preserve and perpetÃºate the liarmony and union of the States. We should never forget that this Union of confederated States was established and comented by kindred blond, and by the comtnon toils, sufTeriugs, dangers and triumplis of' all its parts, and has been the ever augmenting source of our national greatness, and of all our blessings. TLere has perhaps Iseen no period since the warning so impressively given to his countrymen by Washington to guard against geegraphical divisions and Bectional parties, which appeals with greater f'orce than the present, to the patriotic, soberminded and reflecting of all parties and of all sections of our country. Who can calcÃºlate the value of our giorious Union ? It is a model anti example of freo government lo all the world, and it is the star of hope and the haven of rest to the oppressed of evo rv clime. By its preservaiion, we have been rapidly advanced as a nation to a height of strength, power and happiness, without a paralle! in the history of the world. As we extend ils blessing, over new regions, shnll we be so anwise as to endanger its existence by geographical divisions and dissensions ? With a view to encourage the early setllement of these distant possessions.I recommend that liberal grants of the public land be secured to all our citizens who have setlled or may in a lirnited period seltle within tlieir limits. In execution of the provisions of the Treaty orders have been issued to our military and naxal torces to evacÃºate without del.iy the Mexican provinces, cities, towns and fortified places in our military occupation, and whioh are not embraced in the territorios cedod to the U. States. The army is already on its way to the United States. That part of it, as well regulars as volunteers, who engaged to serve during the war with Mexico, wi'.l be dischargud as soon as transported or marched to convenient places in the vicinit of tlieir homes. A part of the regular army will be employed in New Mexico and Upper California to afford protec'.ion to the inhabilants and to forward our interests in that territory. The old army as it existed before the announcemenl of the war with Mexico, especially if authority be civen to fill up the ranK and file of the several corps to the maximum nnmber authorized during the war, it is belioved will be a sumcient force to bc retained in service during a period of peace. A few additional officers in the line and staft' of the army have been authorized, and these it is believed will be necessary in the peace establishment, and should be retuined in the service. The number of the general oflicers may be reduced, as vacancies occur, by the cnsualilics of the service to what it was before the war, While the people of otlier governmenls, ho live under forms of govornment less free than oor own, have been for ages oppressed by taxation to support large standing armies in periods of peace, our experience has shown that such establishments are unneecssary in a I?e public. Our standing army is to be found in the bosom of society. Tt is composed of free citizens who are ever ready to take up arms in the service of their country when an eraergency requires it. Our experience in the war just closed, fully confirms tho opiniÃ³n that such an army muy be raised upon a few weeks' 110tice, and that oor oitizen-soldiers are equal lo any troops in the world. No reason, Uierefore, is perceived why wo should er.large our land forces, and thereby subject the treasurj to an animal increased charge. Sound policy re([uires that we should avoid the creation of a large standing army in a penod of peace. Our public exigency requires it. Such armies are not only expensive and unnecessary, but may bccomc dangerous to liberty. Besides making the necessary legislativo provisions for tho execution of the trea ty, and the establishment of territorial governments in the ceded country, we have, upon the restoration of peace, otlier important duties to perform. Among these, I regard none as more important than thn adoption of proper moasures for the speedy extinguishment nf the national debl. It is against sound poli,,,.' die genius of our rwtitiittons, 'Int spub lic debt should be pcrmitted to exista day lonRer tlian tlie means of the treatury will enable tbc government to pay tl off. _ We should adhere to the wisc pohcy laid down by President Washington, of "avoidfflg the accumulation of debt, not only by shunning occasions of expenso, bot bv vigorous exertions in time ofpoace, to discharge the debt which unavoidable wars have occasioncd, l.Ot un-enerously throwing upon postenty the burden wc ourselvcs ouglit to bear. _ At the commencement of the present admmistration, the public debt amountcd to 817,788 799 G2. In conscquencc of the war witli Mexico, it has been necessarily increasod. and now atnounts to $65,778,450 41, includingthe stock and Ireasury notes which may yet be issued ander the act of January 27, 1847, and the sixteen millions loan recently negotiated under the act of March 31, 1S4S. In addilion to the amount of debt. the treatv stipulates thattwelvc milhon of dollars shal be paid to Mexico in four equal .nstalmonts o tbreo millions each ; the first of which shall fall due on tho 30th May, 1349 The T re tv also stipulates that the United States thal! "assume and pay" to our own citizens "the already liquidated and decided against the Mea can republie," and "all claims not herelofore decided against the Mexican government to an amount not exceedir.g the thrce and One awrter millions of dollars." The " bqu.dateu claims of citizens of the United States against Mexico, as decided by the joint board ofcoTOmissioners under the convention between the United States and Mexico, of the Ut" o April, 1839, amounted to 2,02.6,139 GS. The sum was payable in twenty equal annual uistalm ts. Three of them have Leen paid to the claimentÃ³bycbe Mexican government and two by Ihe United States; leaving 10 be pad of the principal of the liquidated amount uimd b the United States, the sum of $1,519,604 C, torethcr with the interest, thereon. These se veral arnounts of " liquidated" and unliquidated claims assumedby the United States, it is believed may be paid as they fall due out of the accruing reverme, without the issue of stock or tic creation of any additional public debt. I cannot too strongly recommend to Congress theimportanccof husbanding all our nauonal resources, of limiling the public expenditures to necessary ohjects, and of applying all the surplus it any time in the treasury to the redemptionoftho debt. I reermmend that authority be vcsted in the Executive by law to anticÃpate the period of reimbursement of such portion of the debt as may not be now redeemable, and to purchase it al par, or at the premium which it may command in tho market, in all cases in which that authority has not been granted. A premium bas been obtained by the goverment on mnch the larger portion of the loans ; and if, when the government becomes a purchaser of its stock, it shall command a premium in the market.it will be sound policy to pay it, rather than to pay the seiiiiannual interest upon ir. The interest upon the debt, if the outstanding treasury notes shall be funded, from the end of the last riscal year until it shall fall due and be redeemable, will be vcry nearly equal to the principal, which musl itself be ultimately paid. Without changing or modifying the present tarift'of duties,"so great has been the increase of our cornmerce under its benign operation, that the rovenue derivcd from that sou ree and from ihe sales of the public lands, will, it is confidently believed, enable the government to discharge annually several miilions of debt, nu! at the same time possess the means of ting necessary appropriations for all otber objects. Unless Coiigress shall uitliorizo largoly increased expenditures, for objects not of absolute necessity, the vvhole public dcbt exisling beforc the "Mexico war, and tt-at created during its continuance, may be paid off, without any iiicreaso of taxation un the peoplc, long beforo it will faU duo. Ãpon the restoration of peace we should adopt a policy suited to a state of peaco. In doin"- this, tbc earliest practicable paymcntof the public debt should bo the cardinal principie of actkin. Profiling by the xperienco of the past, we should avoid the errors iuto which tho country was betraycd shorlly after the close of the war with Great Brilain in 1S15. In a few vears after that period a broad and latitudinoui construction of (ha powers of the genera! gÃ³verntnent oÃÃfortonately reccived but too much conntenance. Tliough the country was burdened with a heavy public debt, larjje and in some instnnces unncccssai-y and extravagant exponditures wcre authorizod by Con gress. The consequence was, that the paynient of tho debt was postponed for more than twentv years ; and even then, it was only accomplished by the stern will and unbending policy of President Jackson, who made its jiayment a leading measure of his administraron. He resisted the attempts which rere made lo divertthe public money from tliat great object, and apply it in wasteful 'and extravagant cxpenditurei for other objects, some of them of mure than doubtful constitntional authority and expedienco. lftlie government of the United States shall observe a proper ec.onomy in its expenditures, and be confined in ils action to the conduct of our foreign relations and to the few general objects of its care, enumerated in the constitution, leaving all municipal and local legislation to the States, our greatness as a natiou in moral and physical powr, and in wealth and resources, cannot be calculated. By pursuing this policy, oppressive measures" operatins: uuequally and unjustly upon sections and classes will be avoided ; and the people havtng no cause of complaint, will pursue their own interests under tlie blessinga of equiil lavvs and the protection of' a justand paternal governrnent. ]y abstaining from the exercise of all powers not clearly conferred, the cement oÃ our glorious Union, now numbering thirty States, will be strenglhened as we grow i:i age and inercase in population, and our future dostiny will be without a parallel or example in the historv of nations. Washington, July 0, 1848.