The commissioner of the United States took with him the project of a treaty already prepared, by the terms of which the indemnity required by the United States was a cession of territory.

It is well known that the only indemnity which it is in the power of Mexico to make in satisfaction of the just and long-deferred claims of our citizens against her and the only means by which she can reimburse the United States for the expenses of the war is a cession to the United States of a portion of her territory.  Mexico has no money to pay, and no other means of making the required indemnity.  If we refuse this, we can obtain nothing else.  To reject indemnity by refusing to accept a cession of territory would be to abandon all our just demands, and to wage the war, bearing all its expenses, without a purpose or definite object.

A state of war abrogates treaties previously existing between the belligerents and a treaty of peace puts an end to all claims for indemnity for tortious acts committed under the authority of one government against the citizens or subjects of another unless they are provided for in its stipulations.  A treaty of peace which would terminate the existing war without providing for indemnity would enable Mexico, the acknowledged debtor and herself the aggressor in the war, to relieve herself from her just liabilities.  By such a treaty our citizens who hold just demands against her would have no remedy either against Mexico or their own Government.  Our duty to these citizens must forever prevent such a peace, and no treaty which does not provide ample means of discharging these demands can receive my sanction.

A treaty of peace should settle all existing differences between the two countries.  If an adequate cession of territory should be made by such a treaty, the United States should release Mexico from all her liabilities and assume their payment to our own citizens.  If instead of this the United States were to consent to a treaty by which Mexico should again engage to pay the heavy amount of indebtedness which a just indemnity to our Government and our citizens would impose on her, it is notorious that she does not possess the means to meet such an undertaking.  From such a treaty no result could be anticipated but the same irritating disappointments which have heretofore attended the violations of similar treaty stipulations on the part of Mexico.  Such a treaty would be but a temporary cessation of hostilities, without the restoration of the friendship and good understanding which should characterize the future intercourse between the two countries.