The President also, in his last annual message, has declared that he "advised" the people of this Territory to conform and submit, for a short time, to the "only government which remained," and "was established by the military authorities during the war." Strange to say, this advice has never reached the people until this time. However, the spirit of it has been fulfilled. The President, regarding this to be a de facto government, which it was not, offered this advice upon the " presumed consent of the people." To a certain degree the people, without any knowledge of this advice having been given, have consented and abode by it until the system became too oppressive to bear with. As the President has merely advised, and left the matter to the consent of the people, it clearly shows that the consent of the people must first be obtained before it can be de facto in force; and that, without that consent being given, they have the right to create any government they may think necessary for their protection. Hence you will perceive, sir, that the organization of the people of this district was within the reach of their power, and will be, and is, sustained by the united opinion and action of the President and both houses of Congress. The committee, therefore, in conclusion, and according to instructions, in behalf of the people of this district, deem it their duty to inform you of this organization, of the motives impelling them to undertake it, of the means by which it was accomplished, and of the purposes for which it was ordained; and would apply to you, as the highest military authority of the United States in this Territory, to know whether you will extend to the government of this district the necessary aid, when it may be required, for the purpose of preserving order, and of protecting the property, lives, and liberty of its people. This duty the committee believe devolves upon you, as the representative of the government of the United States, and respectfully solicit your acquiescence in the premises. Resolved, That the foregoing is the sense of this legislative assembly in reference to the premises. Passed unanimously. With the highest respect, the committee have the honor to subscribe themselves your most obedient servants, Major General PERSIFOR F. SMITH, JAMES CREIGHTON, HENRY A. HARRISON, Commanding Pacific Division. Committee. REPLY. HEADQUARTERS THIRD DIVISION, San Francisco, California, March 27, 1849. GENTLEMEN: I have the honor to acknowledge the receipt of your letter of the 20th instant, with its several enclosures. The object stated in the resolution referred to in your letter, is to obtain from Commodore Jones and myself such "recognition and concur. rence in (your) proceedings as will strengthen, and, if need be, sustain the exercise of the high conservative powers which have been delegated by the people of this district." The powers alluded to are as follows, viz: "To organize (this) legislative assembly, and to appoint judges and other ministerial officers, and to enact suitable laws to establish principles of justice and equity, and to give protection to life, liberty, and property." These include all the sovereign powers of government; and as my recognition and concurrence would only be asked on the presumption that your proceedings are constitutional and legal, this is equivalent to asking my opinion on those points. I shall confine myself to stating the opinion of the President of the United States and those of his cabinet on the subject of the legal and constitutional effect of the events in California and Mexico on the state of law and government in Upper California, and which opinions have been officially promulgated and laid before Congress as the decision of the Executive on these points, and to which I must conform, as I believe them well founded. 1st. That, at the conclusion of the treaty with Mexico, on the 30th of May, 1848, the military government existing here was a government de facto. 2d. That it must of necessity continue until Congress provide another, because, if it cease, anarchy must ensue-thus inferring that no power but Congress can establish any government. 3d. That Congress has full and exclusive power of legislating for Territories. 4th. And that, though the existence of a state of war no longer affords a foundation for a military government as such, yet, as a government de facto, the consent of the people must be presumed, because no society can intentionally fall into a state of anarchy; and such is the necessary result the "only alternative"-if the government de facto be abrogated before Congress provide another. I have no doubt but that the citizens who have joined in this movement have been actuated by the purest and most patriotic motives, and that the government they have devised would be conducted to insure the respect and gratitude of all under it. But, unless it be well founded, and secure in a validity which can carry it safely through all the searching examinations of future judicial scrutiny, all must be aware that every step taken in prosecution of it is only weaving up an endless thread of lit igation in every commercial and domestic relation. I have not replied to the arguments accompanying your letter, for the position assumed by the Executive seems to me self-evident. But I would respectfully sug gest to you and your fellow citizens, whether an opinion on a point of constitutional law, the result of the deliberations of such jurists as Mr. Buchanan, Governor Marcy, Judge Mason, Mr. Walker, and Judge Toucey, and published to the world by the President of the United States in his annual message, is not entitled to some weight, in at least postponing your further action in this matter until it could be reconsidered by the Executive. I assure you, and your fellow-citizens, that I feel the greatest interest in the welfare of your rising community, and would at once lay down any of my personal opinions on matters of expediency to your superior knowledge of what will best suit the wishes of the people. But in relation to fundamental principles, I would be doing them great injustice if I did not use every effort to prevent the confusion and intricacy that will inevitably result from establishing even the best government on a false basis. I must also remark, that it strikes me that the chief ground of your present action is the misconduct (alleged) of some of the officers of the existing government. Let me assure you that any definite charge will be thoroughly examined, as it will be seen that there is not only the disposition, but the law and the power, to remove and to punish any officer clearly proved to be guilty. . In conclusion, I will state that I do not deem it inconsistent with the principles above stated, that the inhabitants of each district should have and exercise the free right to establish such interior regulations for police and security as they may think fit, and are not adverse to existing laws; and that such regulations should receive the aid of all authorities, civil and military, in their enforcement. With much respect, your obedient servant, PERSIFOR F. SMITH, Brevet Major General, commanding division. To Messrs. JAMES CREIGHTON, GEORGE HYDE, HENRY A. HARRISON, THOMAS J. ROACH, TALBOT H. GREEN, Committee. HEADQUARTERS THIRD DIVISION, SIR: It is, no doubt, a matter of great interest to the government to have some accurate information relative to the actual product and probable wealth of the gold mines in Upper California. But there are no means of collecting facts in an authentic form in the country where the gold is found. The enormous expense attending a visit and residence there can only be incurred by some one who partakes of the advantages of laboring or trading there, and is utterly beyond the means of any whom I am authorized to send. The estimate of the amount produced up to the 1st of this month, which I have stated in my report to the Adjutant General at about four millions, was founded on a comparison of the calculations of different persons who have been at the mines, and of those who trade with the miners. I mentioned in the report that I was collecting some facts which might fix the amount with more certainty. These facts are set forth in the enclosed documents from the person acting as collector of the revenue here; being, first, a statement of the quan tity and value of goods, wares, and merchandise, imported into the port of San Francisco district, California, from October 1st, 1848, to 31st March, 1849; and, second, a statement of gold dust exported from the port of San Francisco from October 1st, 1848, to 31st March, 1849. By the first it appears that the amount of goods received at this port was, during the six months mentioned, $1,089,801 85. Though some of these remain unsold because they do not suit the market, yet that amount is more than balanced by the amount of gold dust not yet brought into market. The goods which have been sold here average 200 per cent. on the invoice value, though the whole amount would not give that rate, as some are unsold. The amount of goods sold would then be in even numbers $3,200,000. Now every part of this has been paid for in gold dust, for all other business has been abandoned which formerly gave a foundation for commerce. And if the amount carried out by those who first procured it be estimated $1,000,000, as it generally is, it would show a probable yield of the mines of $4,250,000. A small trade has been carried on at Monterey and some of the southern ports. As this result is only approximative, it need not be calculated. By the second statement, it appears that the amount actually exported and declared in the custom-house in the same period, is $2,842,040. This amount carried out by individuals, without being declared, by sea, and to Oregon and Sonora by land, is estimated at $1,000,000; and there is here and near the mines about $800,000; making in all about $4,642,000. The estimate of what is here and at the mines is pretty accurate. If that taken out without being declared be reduced one-halfand no one puts in lower than $600,000-there will still remain something near the result of the first calculation, viz: $4,250,000 for the six months ending 1st April. But the period of low water from June to December is that of greatest product in the mines; and this year the force at work there will be at least quadrupled, (if half we hear be true, it will be decupled,) and will have the advantage of better tools and machinery. So that, supposing the gold most easily got has already been gathered, the product of the next 12 months will be from $12,000,000 to $20,000,000. And if it be not a scattered deposite on the surface, but the indications of deeper and extra veins, the amount must be still greater. Two important consequences may follow a very large production of gold, viz: a very large increase of the circulating medium of the commercial world, with a corresponding decrease of its value, and, consequently, a rise in the nominal value of all other articles; and, secondly, a change in the relative value of gold and silver. I cannot believe that either of these evils will be felt very suddenly, or to a great extent, demanding special measures of prevention. As to the second, it may be said that if gold becomes cheaper, silver will be relatively worth more than it now is, and its production increased; for there are some discoveries of silver in South America as wonderful as the gold here. This discovery of the American silver mines, and the immense addition of that metal to the circulation of the world, were many years in changing materially the state of the markets. Several hundred millions were produced before the effect was very apparent. But refer to the state of agriculture and manufactures at that time, see in how few channels money could be directed with profit, and it is evident that a comparatively small surplus would soon find obstructions and choke up the way for its own progress. Now, ten times the same amount, instead of waiting inactive for investment, would be instantly absorbed by the thousand demands of modern industry and enterprise for capital, and, instead of overflowing and ruining the existing channels of trade and commerce, would open many new ones in proportion to the power of supplying them. So far from foreseeing any evil in the augmentation of gold from these mines, I believe it will only give new life and activity to our country where we have land, enterprise, industry, and skill, awaiting only for capital to make them productive; and thus a far greater benefit will ensue than if one-half of the gold went into the public treasury. With respect, your obedient servant, PERSIFOR F. SMITH, Brevet Major General, commanding division. Hon. SECREtary of War. [No. 5.] HEADQUARTERS PACIFIC DIVISION, San Francisco, California, April 29, 1849. SIR: I have the honor herewith to send copies of division orders Nos. 6 and 7, and special orders Nos. 6, 7, 8, 9, 10, and 11. Also, an enclosed surgeon's certificate of ordinary disability in the cases of Sergeant Fanning, privates Griffith, Lomer, and Eversfield, all of the 2d regiment of dragoons. They were referred to me from department headquarters No. 10; and were it not for the fact that a steamer is on the point of starting for Panama, I should act on them. They are forwarded to your office in pursuance with the provisions of the paragraphs 223 and 224, General Regulations; but it is most respectfully suggested that the regulation be so modified as to permit the commanders of the 10th and 11th military departments to discharge upon certificates of disability without referring them to Washington. Communication with general headquarters from California and Oregon is, and must continue for some time, precarious. I have the honor to be, your most obedient servant, PERSIFOR F. SMITH, Brig. Gen. R. JONES, [No. 6.] HEADQUARTERS THIRD DIVISION, GENERAL: Part of General Riley's regiment has arrived since my last report. The general depot has been established at Benicia, on the straits of Karquinnes, and two companies stationed there for its protection. The lease of the warehouses here, occupied by the quartermasters, expires next month, and others could not be hired under $20,000 per annum, if for that. I authorized him to buy a vessel for a sum not exceeding this, to be used as a warehouse and for quarters for two companies, until lumber could be collected and temporary buildings put up. I beg the Quartermaster General may be advised of the change in the location, in order that all stores may be shipped for "Benicia, bay of San Francisco." Two of the small transports here have been ordered to Oregon for lumber; and Captain Ingalls, acting assistant quartermaster, will go to make preparations for receiving and quartering the regiment of mounted riflemen in this Territory. No returns have been received from Oregon, nor have I any intelligence yet of the arrival of Major Hathaway's command, and I do not, therefore, make a division return. A small vessel from the |