2.  While the Treasury is in a state of extreme embarrassment, requiring every dollar which it can make available, and when the Government has not only to lay additional taxes, but to borrow money to meet pressing demands, the bill proposes to give away a fruitful source of revenue—­which is the same thing as raising money by loan and taxation—­not to meet the wants of the Government, but for distribution—­a proceeding which I must regard as highly impolitic, if not unconstitutional.

A brief review of the present condition of the public finances will serve to illustrate the true condition of the Treasury and exhibit its actual necessities: 

On the 5th of August (Friday last) there was
in the Treasury, in round numbers $2,150,000

Necessary to be retained to meet trust funds $360,000
Interest on public debt due in October 80,000
To redeem Treasury notes and pay the interest 100,000
Land distribution under the act of the 4th of
September, 1841 640,000
________ 1,180,000
__________
Leaving an available amount of 970,000

The Navy Department had drawn requisitions on the Treasury at that time to meet debts actually due, among which are bills under protest for $1,414,000, thus leaving an actual deficit of $444,000.

There was on hand about $100,000 of unissued Treasury notes, assisted by the accruing revenue (amounting to about $150,000 per week, exclusive of receipts on unpaid bonds), to meet requisitions for the Army and the demands of the civil list.

The withdrawal of the sum of $640,000 to be distributed among the States, so soon as the statements and accounts can be made up and completed, by virtue of the provisions of the act of the 4th of September last (of which nearly a moiety goes to a few States, and only about $383,000 is to be divided among all the States), while it adds materially to the embarrassments of the Treasury, affords to the States no decided relief.

No immediate relief from this state of things is anticipated unless (what would most deeply be deplored) the Government could be reconciled to the negotiation of loans already authorized by law at a rate of discount ruinous in itself and calculated most seriously to affect the public credit.  So great is the depression of trade that even if the present bill were to become a law and prove to be productive some time would elapse before sufficient supplies would flow into the Treasury, while in the meantime its embarrassments would be continually augmented by the semiannual distribution of the land proceeds.

Indeed, there is but too much ground to apprehend that even if this bill were permitted to become a law—­alienating, as it does, the proceeds of the land sales—­an actual deficit in the Treasury would occur, which would more than probably involve the necessity of a resort to direct taxation.