and the diversion of large numbers of men from labor to military service
have obstructed settlements in the new States and Territories of the
Northwest.

The receipts of the Patent Office have declined in nine months about
$100,000, rendering a large reduction of the force employed necessary to
make it self-sustaining.

The demands upon the Pension Office will be largely increased by the
insurrection. Numerous applications for pensions, based upon the
casualties of the existing war, have already been made. There is reason
to believe that many who are now upon the pension rolls and in receipt
of the bounty of the Government are in the ranks of the insurgent army
or giving them aid and comfort. The Secretary of the Interior has
directed a suspension of the payment of the pensions of such persons
upon proof of their disloyalty. I recommend that Congress authorize that
officer to cause the names of such persons to be stricken from the
pension rolls.

The relations of the Government with the Indian tribes have been greatly
disturbed by the insurrection, especially in the southern
superintendency and in that of New Mexico. The Indian country south of
Kansas is in the possession of insurgents from Texas and Arkansas. The
agents of the United States appointed since the 4th of March for this
superintendency have been unable to reach their posts, while the most of
those who were in office before that time have espoused the
insurrectionary cause, and assume to exercise the powers of agents by
virtue of commissions from the insurrectionists. It has been stated in
the public press that a portion of those Indians have been organized as
a military force and are attached to the army of the insurgents.