The amount of reduction, as well as the manner of effecting it, are questions of great and general interest, it being essential to industrial enterprise and the public prosperity, as well as the dictate of obvious justice, that the burden of taxation be made to rest as equally as possible upon all classes and all sections and interests of the country. I have heretofore recommended to your consideration the revision of the revenue laws, prepared under the direction of the Secretary of the Treasury, and also legislation upon some special questions affecting the business of that Department, more especially the enactment of a law to punish the abstraction of official books or papers from the files of the Government and requiring all such books and papers and all other public property to be turned over by the outgoing officer to his successor; of a law requiring disbursing officers to deposit all public money in the vaults of the Treasury or in other legal depositories, where the same are conveniently accessible, and a law to extend existing penal provisions to all persons who may become possessed of public money by deposit or otherwise and who shall refuse or neglect on due demand to pay the same into the Treasury. I invite your attention anew to each of these objects. The Army during the past year has been so constantly employed against hostile Indians in various quarters that it can scarcely be said, with propriety of language, to have been a peace establishment. Its duties have been satisfactorily performed, and we have reason to expect as a result of the year's operations greater security to the frontier inhabitants than has been hitherto enjoyed. Extensive combinations among the hostile Indians of the Territories of Washington and Oregon at one time threatened the devastation of the newly formed settlements of that remote portion of the country. From recent information we are permitted to hope that the energetic and successful operations conducted there will prevent such combinations in future and secure to those Territories an opportunity to make steady progress in the development of their agricultural and mineral resources. Legislation has been recommended by me on previous occasions to cure defects in the existing organization and to increase the efficiency of the Army, and further observation has but served to confirm me in the views then expressed and to enforce on my mind the conviction that such measures are not only proper, but necessary. I have, in addition, to invite the attention of Congress to a change of policy in the distribution of troops and to the necessity of providing a more rapid increase of the military armament. For details of these and other subjects relating to the Army I refer to the report of the Secretary of War.