Since my last annual communication all the remains of the public debt have been redeemed, or money has been placed in deposit for this purpose whenever the creditors choose to receive it.  All the other pecuniary engagements of the Government have been honorably and promptly fulfilled, and there will be a balance in the Treasury at the close of the present year of about $19,000,000.  It is believed that after meeting all outstanding and unexpended appropriations there will remain near eleven millions to be applied to any new objects which Congress may designate or to the more rapid execution of the works already in progress.  In aid of these objects, and to satisfy the current expenditures of the ensuing year, it is estimated that there will be received from various sources twenty millions more in 1836.

Should Congress make new appropriations in conformity with the estimates which will be submitted from the proper Departments, amounting to about twenty-four millions, still the available surplus at the close of the next year, after deducting all unexpended appropriations, will probably not be less than six millions.  This sum can, in my judgment, be now usefully applied to proposed improvements in our navy-yards, and to new national works which are not enumerated in the present estimates or to the more rapid completion of those already begun.  Either would be constitutional and useful, and would render unnecessary any attempt in our present peculiar condition to divide the surplus revenue or to reduce it any faster than will be effected by the existing laws.  In any event, as the annual report from the Secretary of the Treasury will enter into details, shewing the probability of some decrease in the revenue during the next seven years and a very considerable deduction in 1842, it is not recommended that Congress should undertake to modify the present tariff so as to disturb the principles on which the compromise act was passed.  Taxation on some of the articles of general consumption which are not in competition with our own productions may be no doubt so diminished as to lessen to some extent the source of this revenue, and the same object can also be assisted by more liberal provisions for the subjects of public defense, which in the present state of our prosperity and wealth may be expected to engage your attention.  If, however, after satisfying all the demands which can arise from these sources the unexpended balance in the Treasury should still continue to increase, it would be better to bear with the evil until the great changes contemplated in our tariff laws have occurred and shall enable us to revise the system with that care and circumspection which are due to so delicate and important a subject.