CHAPTER XXIX.

DECEMBER, 1862.

THIRTY-EIGHTH CONGRESS ASSEMBLES-PRESIDENT'S ANNUAL MESSAGE— REPORT OF THE SECRETARY OF THE TREASURY-SKIRMISH AT FRANKLIN, VIRGINIA-UNION TROOPS CAPTURED AT HARTSVILLE, KENTUCKY-RECONNOISSANCES OF GENERAL GEARY TO CHARLESTOWN AND WINCHESTERSURRENDER OF WINCHESTER-GENERAL STUART'S RAID ON DUMFRIES AND OCCOQUAN-GENERAL WASHBURNE'S EXPEDITION TO COFFEEVILLE -THE STEAMSHIP ARIEL CAPTURED-THE BANKS EXPEDITION-FRAUDS ON THE FEDERAL GOVERNMENT-GENERAL BUTLER RELIEVED FROM COMMAND AT NEW ORLEANS-EFFECTS OF THE BLOCKADE OF SOUTHERN PORTS.

On the 1st of December, 1862, the Thirty-eighth Congress commenced its session at Washington, where a full attendance met at this important epoch of national affairs. The anxious eyes of the nation turned toward the proceedings of Congress, and, with more than usual intensity of feeling, the loyal people waited for the message of the Chief Magis trate. It was presented immediately on the organization of both Houses of Congress, and claimed general attention, being expressed in the spirit of sound patriotism and beautiful simplicity, which always characterized the administration of Mr. Lincoln. The important themes of the finances, and the emancipation of slaves, met with special attention. The President admitted, that the immense expenditures of mili tary and naval operations, had been met in a manner creditable to the nation. He showed that, in carrying on the war, a vast expense would necessarily be involved, which would demand careful legislative attention. The issue of United States notes had been rendered necessary by the suspension of specie payments by the banks, in the inception of the rebellion. The use of these notes, in payment of troops, for loans, internal duties, and as a legal tender for debts, had saved large sums in disco ants and exchanges. A return to specie payments should be kept in view, and it was doubtful whether a sufficient y large amount of United States notes would eventually serve as a general equivalent for

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coin, or be payable in the same. To obviate this difficulty, the President suggested the organization of banking associations, under a general act of Congress, to which the Government might furnish circulating notes, whose security would be the United States bonds deposited in the Treasury. As these notes could be converted into coin, the people would be free from the evils of a vitiated currency, cheap exchanges would aid commerce, and the portion of the public debt which was employed as securities, would experience mitigation. A small balance remained in the Treasury. The virtual receipts of the past year amounted to $487,788,324 1. the expenditures to $474,744,788.

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The proclamation respecting "compensated emancipation" was then referred to. The difficulties involving the destiny of the slave, could receive no amelioration by disunion, which was alike forbidden by the geographical features of the country, and any imaginary line which human ingenuity could conceive. As slavery was the chief cause of the rebellion, so its extinction would be its death-blow. Hence a method of emancipation, gradual and equitable, would prove an effective cure for this great evil. His method was the following: The Amendment of the Constitution in such a manner, that every State in which slavery at that time existed, which should abolish the same at any time before the 1st of January, 1900, should receive compensation from the Federal Government. The interest bearing bonds of the United States would be delivered by the President to every such State, in compensation for every slave whom the eighth census of the United States should prove to be living in that State at that time; provided, that if the abolition of slavery in a State should be gradual, the bonds would be delivered by installments, or on complete abolition, in parcels. The bonds should be returned to the United States, and be valueless, in case any State having received them on the abolition of slavery within its limits, should again introduce it therein. The President recommended that all slaves, whom the chances and changes of war had enfranchised, should remain free, and that their masters, if loyal, should be reasonably recompensed. The measure was to be made constitutional by amending the Federal Constitution. This would require the vote of two thirds of the members of Congress, and eventually of three fourths of all the States, which

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296 would involve the consent of seven of the slave States. Their co-operation now would end the rebellion, and restore the Union. The President concludes in language dear to every loyal heart. "The dogmas of the quiet past are inadequate to the stormy present. The occasion is piled high with difficulties, and we must rise with the occasion. As our case is new, we must think and act anew. We must disenthrall ourselves, and then we shall save our country. We cannot escape history. We, of this Congress, and this administration, will be remembered in spite of ourselves. No personal significance, or insignificance, can spare one or another of us. The fiery trial through which we pass will light us down, in honor or dishonor, to the latest generation. The way is plain, peaceful, generous, just a way which, if followed, the world will forever applaud, and God must forever bless."

Both Houses of Congress received this message with the respect to which it was entitled. The nation read it with applause and all classes, whether concurring or otherwise with Mr. Lincoln on the slave question, were pleased with the sincere honesty and pure patriotism of this remarkable Presidential message.

In the report of the Secretary of the Treasury, Salmon P. Chase, distinguished for his able management of the national finances, he, among other matters, explained the manner in which the vast future expenditures might be satisfied. Should the rebellion last till July, 1864, provisions must be made to meet a deficiency of six hundred and twenty-three millions, over all which should have been accumulated by the existing revenues. The important measures recommended for adoption, were twofold. First, a general law authorizing banking associations, and secondly, the obtaining of money by loans, without augmentation of the issue of United States notes beyond the limit fixed by law, except some unavoida ble necessity should require the adoption of such a course.

While the President and Congress were thus engaged in devising measures for the benefit of the nation, the soldiers in the field were struggling to put down rebellion, and save the Union.

On the 2d of December, Colonel Spear, being sent out with a detachment from Norfolk, had a conflict with the enemy near Franklin, on the Blackwater river, Virginia. With

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four infantry regiments, one battery, and the Eleventh Pennsylvania cavalry, he was instructed to proceed to Beaver Dam Church, a few miles from the Blackwater. From this place, videttes were to reconnoitre the country, and ascertain the position and forces of the ene ny. The videttes encountered the Second Georgia regiment, under Lieutenantcolonel Towne, and firing began on both sides. Major Stratton, with three cavalry companies, now came up to rein force the videttes. In a brief, but desperate action, the rebels were routed, and sought refuge in their strong fortifications near Franklin. None of the Federals were injured, and they returned to Norfolk with twenty-two prisoners, two cannon, and some muskets and horses.

On the 7th of December, John Morgan, the guerilla, sud denly appeared before Hartsville, Kentucky, which was gar risoned by the thirty-ninth brigade of Dumont's division, and assaulted the Union force, composed of the One Hundred and Fourth Illinois, One Hundred and Sixth and One Hundred and Eighth Ohio regiments, part of the Second Indiana cavalry, and Nicklen's battery, the whole commanded by Lieutenant-colonel Moore. The rebel forces were three cavalry and two infantry regiments, who charged the Union troops at daylight. Some resisted the enemy bravely, but the rest were thrown into confusion. The combat lasted an hour, when the Unionists were completely surrounded, and nearly all were compelled to lay down. their arms, with a loss of sixty killed and wounded, and the teams and trains of the brigade. Morgan was hotly pursued by Colonels Harlan and Mellon, but escaped beyond the Cumberland river.

General Geary, in command of a division of the Twelfth Army Corps (Slocum's), had been left in garrison duty at Harper's Ferry since the battle of Antietam, having charge of the fortifications in the neighborhood. With three thousand infantry, a squadron of cavalry, and twelve field pieces, he made a reconnoissance, on the 2d of December, in the direction of Winchester. Encountering at Charlestown a small body of the enemy's cavalry, he soon dispersed it, and it fled to Winchester. Advancing within two miles of Berryville, Geary had a spirited action with a still larger body of cavalry, and in a fight of short duration, four of the enemy were killed and twenty wounded. He now learned

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that the rebel General A. P. Hill was at Winchester, with fifteen thousand men. Moving Moving a few miles on the 3d, he continued during the day to skirmish with the enemy, and encamped on the Opequan creek at night. Advancing on Winchester next day, he encountered a line of rebel cavalry, and found that they were the only troops in the place. Demanding an unconditional surrender of the town, the Confederate commander proposed to evacuate, provided an hour was granted to non-combatants to leave. This being refused, but a promise of non-interference, provided the citizens refrained from firing on the troops, being proffered, the rebel commander quickly departed with his troops, and the city, on the reception of a flag of truce, was surrendered. The small-pox prevailing in the place, it was not entered by the Union troops. Possession, however, was taken of the forts and town, and after paroling one hundred and twenty-five of the enemy, the sick and wounded tenants of the hospital, and driving off their cavalry, General Geary returned to Harper's Ferry. On the 11th he occupied Leesburg, and the road between Aquia creek and Alexandria, keeping guard over the more important points, from Fairfax Court House to the village of Dumfries.

The Confederate General J. E. B. Stuart, with three thou sand five hundred cavalry, and a battery, crossed the Rappahannock on the 27th, on a raiding expedition, and assaulted three infantry regiments and one of cavalry, together with a section of artillery, at the latter place. These troops belonged to the division of General Geary, and were in command of Colonel Candy. After the surprise and capture of the pickets, fifty in number, Stuart shelled the town, and charged the Union forces, but in a combat continuing from two till eight o'clock P. M., his attempts to flank the latter signally failed, and after sustaining severe punishment, he withdrew some miles from the village, to the Neobosco river. The same evening, Geary brought up the rest of his troops to Wolf Run Shoals, and on the morning of the 28th, crossed the Occoquan. General Williams' division of the Twelfth Army Corps, followed at the distance of a few miles. Early on the 28th, the enemy moved along the road from Brentville to Occoquan, and on their way encountered the Third Pennsylvania cavalry, which was taken by surprise, losing one hundred prisoners, and twenty killed and wounded. The troops of the Seventeenth Pennsylvania cav.