self-government for the preservation of so great a good.

The great mass of legislation relating to our internal affairs was intended to be left where the Federal Convention found it--in the State governments. Nothing is clearer, in my view, than that we are chiefly indebted for the success of the Constitution under which we are now acting to the watchful and auxiliary operation of the State authorities. This is not the reflection of a day, but belongs to the most deeply rooted convictions of my mind. I can not, therefore, too strongly or too earnestly, for my own sense of its importance, warn you against all encroachments upon the legitimate sphere of State sovereignty. Sustained by its healthful and invigorating influence the federal system can never fall.

In the collection of the revenue the long credits authorized on goods imported from beyond the Cape of Good Hope are the chief cause of the losses at present sustained. If these were shortened to 6, 9, and 12 months, and ware-houses provided by Government sufficient to receive the goods offered in deposit for security and for debenture, and if the right of the United States to a priority of payment out of the estates of its insolvent debtors were more effectually secured, this evil would in a great measure be obviated. An authority to construct such houses is therefore, with the proposed alteration of the credits, recommended to your attention.

It is worthy of notice that the laws for the collection and security of the revenue arising from imposts were chiefly framed when the rates of duties on imported goods presented much less temptation for illicit trade than at present exists. There is reason to believe that these laws are in some respects quite insufficient for the proper security of the revenue and the protection of the interests of those who are disposed to observe them. The injurious and demoralizing tendency of a successful system of smuggling is so obvious as not to require comment, and can not be too carefully guarded against. I therefore suggest to Congress the propriety of adopting efficient measures to prevent this evil, avoiding, however, as much as possible, every unnecessary infringement of individual liberty and embarrassment of fair and lawful business.

On an examination of the records of the Treasury I have been forcibly struck with the large amount of public money which appears to be outstanding. Of the sum thus due from individuals to the Government a considerable portion is undoubtedly desperate, and in many instances has probably been rendered so by remissness in the agents charged with its collection. By proper exertions a great part, however, may yet be recovered; and what ever may be the portions respectively belonging to these two classes, it behooves the Government to ascertain the real state of the fact. This can be done only by the prompt adoption of judicious measures for the collection of such as may be made available. It is believed that a very large amount has been lost through the inadequacy of the means provided for the collection of debts due to the public, and that this inadequacy lies chiefly in the want of legal skill habitually and constantly employed in the direction of the agents engaged in the service. It must, I think, be admitted that the supervisory power over suits brought by the public, which is now vested in an accounting officer of the Treasury, not selected with a view to his legal knowledge, and encumbered as he is with numerous other duties, operates unfavorably to the public interest.

It is important that this branch of the public service should be subjected to the supervision of such professional skill as will give it efficiency. The expense attendant upon such a modification of the executive department would be justified by the soundest principles of economy. I would recommend, therefore, that the duties now assigned to the agent of the Treasury, so far as they relate to the superintendence and management of legal proceedings on the part of the United States, be transferred to the Attorney General, and that this officer be placed on the same footing in all respects as the heads of the other Departments, receiving like compensation and having such subordinate officers provided for his Department as may be requisite for the discharge of these additional duties. The professional skill of the Attorney General, employed in directing the conduct of marshals and district attorneys, would hasten the collection of debts now in suit and hereafter save much to the Government. It might be further extended to the superintendence of all criminal proceedings for offenses against the United States. In making this transfer great care should be taken, however, that the power necessary to the Treasury Department be not impaired, one of its greatest securities consisting in control over all accounts until they are audited or reported for suit.

In connection with the foregoing views I would suggest also an inquiry whether the provisions of the act of Congress authorizing the discharge of the persons of the debtors to the Government from imprisonment may not, consistently with the public interest, be extended to the release of the debt where the conduct of the debtor is wholly exempt from the imputation of fraud. Some more liberal policy than that which now prevails in reference to this unfortunate class of citizens is certainly due to them, and would prove beneficial to the country. The continuance of the liability after the means to discharge it have been exhausted can only serve to dispirit the debtor; or, where his resources are but partial, the want of power in the Government to compromise and release the demand instigates to fraud as the only resource for securing a support to his family. He thus sinks into a state of apathy, and becomes a useless drone in society or a vicious member of it, if not a feeling witness of the rigor and inhumanity of his country. All experience proves that oppressive debt is the bane of enterprise, and it should be the care of a republic not to exert a grinding power over misfortune and poverty.

Since the last session of Congress numerous frauds on the Treasury have been discovered, which I thought it my duty to bring under the cognizance of the United States court for this district by a criminal prosecution. It was my opinion and that of able counsel who were consulted that the cases came within the penalties of the act of the 17th Congress approved March 3d, 1823, providing for punishment of frauds committed on the Government of the United States. Either from some defect in the law or in its administration every effort to bring the accused to trial under its provisions proved ineffectual, and the Government was driven to the necessity of resorting to the vague and inadequate provisions of the common law. It is therefore my duty to call your attention to the laws which have been passed for the protection of the Treasury. If, indeed, there be no provision by which those who may be unworthily intrusted with its guardianship can be punished for the most flagrant violation of duty, extending even to the most fraudulent appropriation of the public funds to their own use, it is time to remedy so dangerous an omission; or if the law has been perverted from its original purposes, and criminals deserving to be punished under its provisions have been rescued by legal subtleties, it ought to be made so plain by amendatory provisions as to baffle the arts of perversion and accomplish the ends of its original enactment.

In one of the most flagrant causes the court decided that the prosecution was barred by the statute which limits prosecutions for fraud to two years. In this case all the evidences of the fraud, and, indeed, all knowledge that a fraud had been committed, were in possession of the party accused until after the two years had elapsed. Surely the statute ought not to run in favor of any man while he retains all the evidences of his crime in his own possession, and least of all in favor of a public officer who continues to defraud the Treasury and conceal the