With the nations of Europe in general our friendship and intercourse are undisturbed, and from the governments of the belligerent powers especially we continue to receive those friendly manifestations which are justly due to an honest neutrality, and to such good offices consistent with that as we have opportunities of rendering.

The activity and success of the small force employed in the Mediterranean in the early part of the present year, the reinforcement sent into that sea, and the energy of the officers having command in the several vessels, will, I trust, by the sufferings of war, reduce the barbarians of Tripoli to the desire of peace on proper terms. Great injury, however, ensues to ourselves as well as to others interested, from the distance to which prizes must be brought for adjudication, and from the impracticability of bringing hither such as are not seaworthy.

The bey of Tunis having made requisitions unauthorized by our treaty, their rejection has produced from him some expressions of discontent. But to those who expect us to calculate whether a compliance with unjust demands will not cost us less than a war, we must leave as a question of calculation for them, also, whether to retire from unjust demands will not cost them less than a war. We can do to each other very sensible injuries by war, but the mutual advantages of peace make that the best interest of both.

Peace and intercourse with the other powers on the same coast continue on the footing on which they are established by treaty.

In pursuance of the act providing for the temporary government of Louisiana, the necessary officers for the territory of Orleans were appointed in due time, to commence the exercise of their functions on the first day of October. The distance, however, of some of them, and indispensable previous arrangements, may have retarded its commencement in some of its parts; the form of government thus provided having been considered but as temporary, and open to such improvements as further information of the circumstances of our brethren there might suggest, it will of course be subject to your consideration.

In the district of Louisiana, it has been thought best to adopt the division into subordinate districts, which had been established under its former government. These being five in number, a commanding officer has been appointed to each, according to the provision of the law, and so soon as they can be at their station, that district will also be in its due state of organization; in the meantime their places are supplied by the officers before commanding there. The functions of the governor and judges of Indiana have commenced; the government, we presume, is proceeding in its new form. The lead mines in that district offer so rich a supply of that metal, as to merit attention. The report now communicated will inform you of their state, and of the necessity of immediate inquiry into their occupation and titles.

With the Indian tribes established within our newly-acquired limits, I have deemed it necessary to open conferences for the purpose of establishing a good understanding and neighborly relations between us. So far as we have yet learned, we have reason to believe that their dispositions are generally favorable and friendly; and with these dispositions on their part, we have in our own hands means which cannot fail us for preserving their peace and friendship. By pursuing a uniform course of justice toward them, by aiding them in all the improvements which may better their condition, and especially by establishing a commerce on terms which shall be advantageous to them and only not losing to us, and so regulated as that no incendiaries of our own or any other nation may be permitted to disturb the natural effects of our just and friendly offices, we may render ourselves so necessary to their comfort and prosperity, that the protection of our citizens from their disorderly members will become their interest and their voluntary care. Instead, therefore, of an augmentation of military force proportioned to our extension of frontier, I proposed a moderate enlargement of the capital employed in that commerce, as a more effectual, economical, and humane instrument for preserving peace and good neighborhood with them.

On this side the Mississippi an important relinquishment of native title has been received from the Delawares. That tribe, desiring to extinguish in their people the spirit of hunting, and to convert superfluous lands into the means of improving what they retain, have ceded to us all the country between the Wabash and the Ohio, south of, and including the road from the rapids towards Vincennes, for which they are to receive annuities in animals and implements for agriculture, and in other necessaries. This acquisition is important, not only for its extent and fertility, but as fronting three hundred miles on the Ohio, and near half that on the Wabash. The produce of the settled countries descending those rivers, will no longer pass in review of the Indian frontier but in a small portion, and with the cession heretofore made with the Kaskaskias, nearly consolidates our possessions north of the Ohio, in a very respectable breadth, from Lake Erie to the Mississippi. The Piankeshaws having some claim to the country ceded by the Delawares, it has been thought best to quiet that by fair purchase also. So soon as the treaties on this subject shall have received their constitutional sanctions, they shall be laid before both houses.

The act of Congress of February 28th, 1803, for building and employing a number of gun-boats, is now in a course of execution to the extent there provided for. The obstacle to naval enterprise which vessels of this construction offer for our seaport towns; their utility toward supporting within our waters the authority of the laws; the promptness with which they will be manned by the seamen and militia of the place the moment they are wanting; the facility of their assembling from different parts of the coast to any point where they are required in greater force than ordinary; the economy of their maintenance and preservation from decay when not in actual service; and the competence of our finances to this defensive provision, without any new burden, are considerations which will have due weight with Congress in deciding on the expediency of adding to their number from year to year, as experience shall test their utility, until all our important harbors, by these and auxiliary means, shall be insured against insult and opposition to the laws.

No circumstance has arisen since your last session which calls for any augmentation of our regular military force. Should any improvement occur in the militia system, that will be always seasonable.