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´╗┐Title: State of the Union Addresses
Author: Cleveland, Grover
Language: English
As this book started as an ASCII text book there are no pictures available.
Copyright Status: Not copyrighted in the United States. If you live elsewhere check the laws of your country before downloading this ebook. See comments about copyright issues at end of book.

*** Start of this Doctrine Publishing Corporation Digital Book "State of the Union Addresses" ***

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State of the Union Addresses of Grover Cleveland



The addresses are separated by three asterisks: ***

Dates of addresses by Grover Cleveland in this eBook:

  December 8, 1885
  December 6, 1886
  December 6, 1887
  December 3, 1888



***

State of the Union Address
Grover Cleveland
December 8, 1885

To the Congress of the United States:

Your assembling is clouded by a sense of public bereavement, caused by the
recent and sudden death of Thomas A. Hendricks, Vice-President of the
United States. His distinguished public services, his complete integrity
and devotion to every duty, and his personal virtues will find honorable
record in his country's history.

Ample and repeated proofs of the esteem and confidence in which he was held
by his fellow-countrymen were manifested by his election to offices of the
most important trust and highest dignity; and at length, full of years and
honors, he has been laid at rest amid universal sorrow and benediction.

The Constitution, which requires those chosen to legislate for the people
to annually meet in the discharge of their solemn trust, also requires the
President to give to Congress information of the state of the Union and
recommend to their consideration such measures as he shall deem necessary
and expedient. At the threshold of a compliance with these constitutional
directions it is well for us to bear in mind that our usefulness to the
people's interests will be promoted by a constant appreciation of the scope
and character of our respective duties as they relate to Federal
legislation. While the Executive may recommend such measures as he shall
deem expedient, the responsibility for legislative action must and should
rest upon those selected by the people to make their laws.

Contemplation of the grave and responsible functions assigned to the
respective branches of the Government under the Constitution will disclose
the partitions of power between our respective departments and their
necessary independence, and also the need for the exercise of all the power
intrusted to each in that spirit of comity and cooperation which is
essential to the proper fulfillment of the patriotic obligations which rest
upon us as faithful servants of the people.

The jealous watchfulness of our constituencies, great and small,
supplements their suffrages, and before the tribunal they establish every
public servant should be judged.

It is gratifying to announce that the relations of the United States with
all foreign powers continue to be friendly. Our position after nearly a
century of successful constitutional government, maintenance of good faith
in all our engagements, the avoidance of complications with other nations,
and our consistent and amicable attitude toward the strong and weak alike
furnish proof of a political disposition which renders professions of good
will unnecessary. There are no questions of difficulty pending with any
foreign government.

The Argentine Government has revived the long dormant question of the
Falkland Islands by claiming from the United States indemnity for their
loss, attributed to the action of the commander of the sloop of war
Lexington in breaking up a piratical colony on those islands in 1831, and
their subsequent occupation by Great Britain. In view of the ample
justification for the act of the Lexington and the derelict condition of
the islands before and after their alleged occupation by Argentine
colonists, this Government considers the claim as wholly groundless.

Question has arisen with the Government of Austria-Hungary touching the
representation of the United States at Vienna. Having under my
constitutional prerogative appointed an estimable citizen of unimpeached
probity and competence as minister at that court, the Government of
Austria-Hungary invited this Government to take cognizance of certain
exceptions, based upon allegations against the personal acceptability of
Mr. Keiley, the appointed envoy, asking that in view thereof the
appointment should be withdrawn. The reasons advanced were such as could
not be acquiesced in without violation of my oath of office and the
precepts of the Constitution, since they necessarily involved a limitation
in favor of a foreign government upon the right of selection by the
Executive and required such an application of a religious test as a
qualification for office under the United States as would have resulted in
the practical disfranchisement of a large class of our citizens and the
abandonment of a vital principle in our Government. The Austro-Hungarian
Government finally decided not to receive Mr. Keiley as the envoy of the
United States, and that gentleman has since resigned his commission,
leaving the post vacant. I have made no new nomination, and the interests
of this Government at Vienna are now in the care of the secretary of
legation, acting as charge d'affaires ad interim.

Early in March last war broke out in Central America, caused by the attempt
of Guatemala to consolidate the several States into a single government. In
these contests between our neighboring States the United States forebore to
interfere actively, but lent the aid of their friendly offices in
deprecation of war and to promote peace and concord among the belligerents,
and by such counsel contributed importantly to the restoration of
tranquillity in that locality.

Emergencies growing out of civil war in the United States of Colombia
demanded of the Government at the beginning of this Administration the
employment of armed forces to fulfill its guaranties under the thirty-fifth
article of the treaty of 1846, in order to keep the transit open across the
Isthmus of Panama. Desirous of exercising only the powers expressly
reserved to us by the treaty, and mindful of the rights of Colombia, the
forces sent to the Isthmus were instructed to confine their action to
"positively and efficaciously" preventing the transit and its accessories
from being "interrupted or embarrassed."

The execution of this delicate and responsible task necessarily involved
police control where the local authority was temporarily powerless, but
always in aid of the sovereignty of Colombia.

The prompt and successful fulfillment of its duty by this Government was
highly appreciated by the Government of Colombia, and has been followed by
expressions of its satisfaction.

High praise is due to the officers and men engaged in this service. The
restoration of peace on the Isthmus by the reestablishment of the
constituted Government there being thus accomplished, the forces of the
United States were withdrawn.

Pending these occurrences a question of much importance was presented by
decrees of the Colombian Government proclaiming the closure of certain
ports then in the hands of insurgents and declaring vessels held by the
revolutionists to be piratical and liable to capture by any power. To
neither of these propositions could the United States assent. An effective
closure of ports not in the possession of the Government, but held by
hostile partisans, could not be recognized; neither could the vessels of
insurgents against the legitimate sovereignty be deemed hostes humani
generis within the precepts of international law, whatever might be the
definition and penalty of their acts under the municipal law of the State
against whose authority they were in revolt. The denial by this Government
of the Colombian propositions did not, however, imply the admission of a
belligerent status on the part of the insurgents.

The Colombian Government has expressed its willingness to negotiate
conventions for the adjustment by arbitration of claims by foreign citizens
arising out of the destruction of the city of Aspinwall by the
insurrectionary forces.

The interest of the United States in a practicable transit for ships across
the strip of land separating the Atlantic from the Pacific has been
repeatedly manifested during the last half century.

My immediate predecessor caused to be negotiated with Nicaragua a treaty
for the construction, by and at the sole cost of the United States, of a
canal through Nicaraguan territory, and laid it before the Senate. Pending
the action of that body thereon, I withdrew the treaty for reexamination.
Attentive consideration of its provisions leads me to withhold it from
resubmission to the Senate.

Maintaining, as I do, the tenets of a line of precedents from Washington's
day, which proscribe entangling alliances with foreign states, I do not
favor a policy of acquisition of new and distant territory or the
incorporation of remote interests with our own.

The laws of progress are vital and organic, and we must be conscious of
that irresistible tide of commercial expansion which, as the concomitant of
our active civilization, day by day is being urged onward by those
increasing facilities of production, transportation, and communication to
which steam and electricity have given birth; but our duty in the present
instructs us to address ourselves mainly to the development of the vast
resources of the great area committed to our charge and to the cultivation
of the arts of peace within our own borders, though jealously alert in
preventing the American hemisphere from being involved in the political
problems and complications of distant governments. Therefore I am unable to
recommend propositions involving paramount privileges of ownership or
right outside of our own territory, when coupled with absolute and
unlimited engagements to defend the territorial integrity of the state
where such interests lie. While the general project of connecting the two
oceans by means of a canal is to be encouraged, I am of opinion that any
scheme to that end to be considered with favor should be free from the
features alluded to.

The Tehuantepec route is declared by engineers of the highest repute and by
competent scientists to afford an entirely practicable transit for vessels
and cargoes, by means of a ship railway, from the Atlantic to the Pacific.
The obvious advantages of such a route, if feasible, over others more
remote from the axial lines of traffic between Europe and the pacific, and
particularly between the Valley of the Mississippi and the western coast of
North and South America, are deserving of consideration.

Whatever highway may be constructed across the barrier dividing the two
greatest maritime areas of the world must be for the world's benefit--a
trust for mankind, to be removed from the chance of domination by any
single power, nor become a point of invitation for hostilities or a prize
for warlike ambition. An engagement combining the construction, ownership,
and operation of such a work by this Government, with an offensive and
defensive alliance for its protection, with the foreign state whose
responsibilities and rights we would share is, in my judgment, inconsistent
with such dedication to universal and neutral use, and would, moreover,
entail measures for its realization beyond the scope of our national polity
or present means.

The lapse of years has abundantly confirmed the wisdom and foresight of
those earlier Administrations which, long before the conditions of maritime
intercourse were changed and enlarged by the progress of the age,
proclaimed the vital need of interoceanic transit across the American
Isthmus and consecrated it in advance to the common use of mankind by their
positive declarations and through the formal obligation of treaties. Toward
such realization the efforts of my Administration will be applied, ever
bearing in mind the principles on which it must rest, and which were
declared in no uncertain tones by Mr. Cass, who, while Secretary of State,
in 1858, announced that "what the United States want in Central America,
next to the happiness of its people, is the security and neutrality of the
interoceanic routes which lead through it."

The construction of three transcontinental lines of railway, all in
successful operation, wholly within our territory, and uniting the Atlantic
and the Pacific oceans, has been accompanied by results of a most
interesting and impressive nature, and has created new conditions, not in
the routes of commerce only, but in political geography, which powerfully
affect our relations toward and necessarily increase our interests in any
transisthmian route which may be opened and employed for the ends of peace
and traffic, or, in other contingencies, for uses inimical to both.

Transportation is a factor in the cost of commodities scarcely second to
that of their production, and weighs as heavily upon the consumer.

Our experience already has proven the great importance of having the
competition between land carriage and water carriage fully developed, each
acting as a protection to the public against the tendencies to monopoly
which are inherent in the consolidation of wealth and power in the hands of
vast corporations.

These suggestions may serve to emphasize what I have already said on the
score of the necessity of a neutralization of any interoceanic transit; and
this can only be accomplished by making the uses of the route open to all
nations and subject to the ambitions and warlike necessities of none.

The drawings and report of a recent survey of the Nicaragua Canal route,
made by Chief Engineer Menocal, will be communicated for your information.

The claims of citizens of the United States for losses by reason of the
late military operations of Chile in Peru and Bolivia are the subject of
negotiation for a claims convention with Chile, providing for their
submission to arbitration.

The harmony of our relations with China is fully sustained.

In the application of the acts lately passed to execute the treaty of 1880,
restrictive of the immigration of Chinese laborers into the United States,
individual cases of hardship have occurred beyond the power of the
Executive to remedy, and calling for judicial determination.

The condition of the Chinese question in the Western States and Territories
is, despite this restrictive legislation, far from being satisfactory. The
recent outbreak in Wyoming Territory, where numbers of unoffending
Chinamen, indisputably within the protection of the treaties and the law,
were murdered by a mob, and the still more recent threatened outbreak of
the same character in Washington Territory, are fresh in the minds of all,
and there is apprehension lest the bitterness of feeling against the
Mongolian race on the Pacific Slope may find vent in similar lawless
demonstrations. All the power of this Government should be exerted to
maintain the amplest good faith toward China in the treatment of these men,
and the inflexible sternness of the law in bringing the wrongdoers to
justice should be insisted upon.

Every effort has been made by this Government to prevent these violent
outbreaks and to aid the representatives of China in their investigation of
these outrages; and it is but just to say that they are traceable to the
lawlessness of men not citizens of the United States engaged in competition
with Chinese laborers.

Race prejudice is the chief factor in originating these disturbances, and
it exists in a large part of our domain, jeopardizing our domestic peace
and the good relationship we strive to maintain with China.

The admitted right of a government to prevent the influx of elements
hostile to its internal peace and security may not be questioned, even
where there is no treaty stipulation on the subject. That the exclusion of
Chinese labor is demanded in other countries where like conditions prevail
is strongly evidenced in the Dominion of Canada, where Chinese immigration
is now regulated by laws more exclusive than our own. If existing laws are
inadequate to compass the end in view, I shall be prepared to give earnest
consideration to any further remedial measures, within the treaty limits,
which the wisdom of Congress may devise.

The independent State of the Kongo has been organized as a government under
the sovereignty of His Majesty the King of the Belgians, who assumes its
chief magistracy in his personal character only, without making the new
State a dependency of Belgium. It is fortunate that a benighted region,
owing all it has of quickening civilization to the beneficence and
philanthropic spirit of this monarch, should have the advantage and
security of his benevolent supervision.

The action taken by this Government last year in being the first to
recognize the flag of the International Association of the Kongo has been
followed by formal recognition of the new nationality which succeeds to its
sovereign powers.

A conference of delegates of the principal commercial nations was held at
Berlin last winter to discuss methods whereby the Kongo basin might be kept
open to the world's trade. Delegates attended on behalf of the United
States on the understanding that their part should be merely deliberative,
without imparting to the results any binding character so far as the United
States were concerned. This reserve was due to the indisposition of this
Government to share in any disposal by an international congress of
jurisdictional questions in remote foreign territories. The results of the
conference were embodied in a formal act of the nature of an international
convention, which laid down certain obligations purporting to be binding on
the signatories, subject to ratification within one year. Notwithstanding
the reservation under which the delegates of the United States attended,
their signatures were attached to the general act in the same manner as
those of the plenipotentiaries of other governments, thus making the United
States appear, without reserve or qualification, as signatories to a joint
international engagement imposing on the signers the conservation of the
territorial integrity of distant regions where we have no established
interests or control.

This Government does not, however, regard its reservation of liberty of
action in the premises as at all impaired; and holding that an engagement
to share in the obligation of enforcing neutrality in the remote valley of
the Kongo would be an alliance whose responsibilities we are not in a
position to assume, I abstain from asking the sanction of the Senate to
that general act.

The correspondence will be laid before you, and the instructive and
interesting report of the agent sent by this Government to the Kongo
country and his recommendations for the establishment of commercial
agencies on the African coast are also submitted for your consideration.

The commission appointed by my predecessor last winter to visit the Central
and South American countries and report on the methods of enlarging the
commercial relations of the United States therewith has submitted reports,
which will be laid before you.

No opportunity has been omitted to testify the friendliness of this
Government toward Korea, whose entrance into the family of treaty powers
the United States were the first to recognize. I regard with favor the
application made by the Korean Government to be allowed to employ American
officers as military instructors, to which the assent of Congress becomes
necessary, and I am happy to say this request has the concurrent sanction
of China and Japan.

The arrest and imprisonment of Julio R. Santos, a citizen of the United
States, by the authorities of Ecuador gave rise to a contention with that
Government, in which his right to be released or to have a speedy and
impartial trial on announced charges and with all guaranties of defense
stipulated by treaty was insisted upon by us. After an elaborate
correspondence and repeated and earnest representations on our part Mr.
Santos was, after an alleged trial and conviction, eventually included in a
general decree of amnesty and pardoned by the Ecuadorian Executive and
released, leaving the question of his American citizenship denied by the
Ecuadorian Government, but insisted upon by our own.

The amount adjudged by the late French and American Claims Commission to be
due from the United States to French claimants on account of injuries
suffered by them during the War of Secession, having been appropriated by
the last Congress, has been duly paid to the French Government.

The act of February 25, 1885, provided for a preliminary search of the
records of French prize courts for evidence bearing on the claims of
American citizens against France for spoliations committed prior to 1801.
The duty has been performed, and the report of the agent will be laid
before you.

I regret to say that the restrictions upon the importation of our pork into
France continue, notwithstanding the abundant demonstration of the absence
of sanitary danger in its use; but I entertain strong hopes that with a
better understanding of the matter this vexatious prohibition will be
removed. It would be pleasing to be able to say as much with respect to
Germany, Austria, and other countries, where such food products are
absolutely excluded, without present prospect of reasonable change.

The interpretation of our existing treaties of naturalization by Germany
during the past year has attracted attention by reason of an apparent
tendency on the part of the Imperial Government to extend the scope of the
residential restrictions to which returning naturalized citizens of German
origin are asserted to be liable under the laws of the Empire. The
temperate and just attitude taken by this Government with regard to this
class of questions will doubtless lead to a satisfactory understanding.

The dispute of Germany and Spain relative to the domination of the Caroline
Islands has attracted the attention of this Government by reason of
extensive interests of American citizens having grown up in those parts
during the past thirty years, and because the question of ownership
involves jurisdiction of matters affecting the status of our citizens under
civil and criminal law. While standing wholly aloof from the proprietary
issues raised between powers to both of which the United States are
friendly, this Government expects that nothing in the present contention
shall unfavorably affect our citizens carrying on a peaceful commerce or
there domiciled, and has so informed the Governments of Spain and Germany.

The marked good will between the United States and Great Britain has been
maintained during the past year.

The termination of the fishing clauses of the treaty of Washington, in
pursuance of the joint resolution of March 3, 1883, must have resulted in
the abrupt cessation on the 1st of July of this year, in the midst of their
ventures, of the operations of citizens of the United States engaged in
fishing in British American waters but for a diplomatic understanding
reached with Her Majesty's Government in June last, whereby assurance was
obtained that no interruption of those operations should take place during
the current fishing season.

In the interest of good neighborhood and of the commercial intercourse of
adjacent communities, the question of the North American fisheries is one
of much importance. Following out the intimation given by me when the
extensory arrangement above described was negotiated, I recommend that the
Congress provide for the appointment of a commission in which the
Governments of the United States and Great Britain shall be respectively
represented, charged with the consideration and settlement, upon a just,
equitable, and honorable basis, of the entire question of the fishing
rights of the two Governments and their respective citizens on the coasts
of the United States and British North America. The fishing interests being
intimately related to other general questions dependent upon contiguity and
intercourse, consideration thereof in all their equities might also
properly come within the purview of such a commission, and the fullest
latitude of expression on both sides should be permitted.

The correspondence in relation to the fishing rights will be submitted. The
arctic exploring steamer Alert, which was generously given by Her Majesty's
Government to aid in the relief of the Greely expedition, was, after the
successful attainment of that humane purpose, returned to Great Britain, in
pursuance of the authority conferred by the act of March 3, 1885.

The inadequacy of the existing engagements for extradition between the
United States and Great Britain has been long apparent. The tenth article
of the treaty of 1842, one of the earliest compacts in this regard entered
into by us, stipulated for surrender in respect of a limited number of
offenses. Other crimes no less inimical to the social welfare should be
embraced and the procedure of extradition brought in harmony with present
international practice. Negotiations with Her Majesty's Government for an
enlarged treaty of extradition have been pending since 1870, and I
entertain strong hopes that a satisfactory result may be soon attained.

The frontier line between Alaska and British Columbia, as defined by the
treaty of cession with Russia, follows the demarcation assigned in a prior
treaty between Great Britain and Russia. Modern exploration discloses that
this ancient boundary is impracticable as a geographical fact. In the
unsettled condition of that region the question has lacked importance, but
the discovery of mineral wealth in the territory the line is supposed to
traverse admonishes that the time has come when an accurate knowledge of
the boundary is needful to avert jurisdictional complications. I recommend,
therefore, that provision be made for a preliminary reconnoissance by
officers of the United States, to the end of acquiring more precise
information on the subject. I have invited Her Majesty's Government to
consider with us the adoption of a more convenient line, to be established
by meridian observations or by known geographical features without the
necessity of an expensive survey of the whole.

The late insurrectionary movements in Hayti having been quelled, the
Government of that Republic has made prompt provision for adjudicating the
losses suffered by foreigners because of hostilities there, and the claims
of certain citizens of the United States will be in this manner
determined.

The long-pending claims of two citizens of the United States, Pelletier and
Lazare, have been disposed of by arbitration, and an award in favor of each
claimant has been made, which by the terms of the engagement is final. It
remains for Congress to provide for the payment of the stipulated moiety of
the expenses.

A question arose with Hayti during the past year by reason of the
exceptional treatment of an American citizen, Mr. Van Bokkelen, a resident
of Port-au-Prince, who, on suit by creditors residing in the United States,
was sentenced to imprisonment, and, under the operation of a Haytian
statute, was denied relief secured to a native Haytian. This Government
asserted his treaty right to equal treatment with natives of Hayti in all
suits at law. Our contention was denied by the Haytian Government, which,
however, while still professing to maintain the ground taken against Mr.
Van Bokkelen's right, terminated the controversy by setting him at liberty
without explanation.

An international conference to consider the means of arresting the spread
of cholera and other epidemic diseases was held at Rome in May last, and
adjourned to meet again on further notice. An expert delegate on behalf of
the United States has attended its sessions and will submit a report.

Our relations with Mexico continue to be most cordial, as befits those of
neighbors between whom the strongest ties of friendship and commercial
intimacy exist, as the natural and growing consequence of our similarity of
institutions and geographical propinquity.

The relocation of the boundary line between the United States and Mexico
westward of the Rio Grande, under the convention of July 29, 1882, has been
unavoidably delayed, but I apprehend no difficulty in securing a
prolongation of the period for its accomplishment.

The lately concluded commercial treaty with Mexico still awaits the
stipulated legislation to carry its provisions into effect, for which one
year's additional time has been secured by a supplementary article signed
in February last and since ratified on both sides.

As this convention, so important to the commercial welfare of the two
adjoining countries, has been constitutionally confirmed by the treaty-
making branch, I express the hope that legislation needed to make it
effective may not be long delayed.

The large influx of capital and enterprise to Mexico from the United States
continues to aid in the development of the resources and in augmenting the
material well-being of our sister Republic. Lines of railway, penetrating
to the heart and capital of the country, bring the two peoples into
mutually beneficial intercourse, and enlarged facilities of transit add to
profitable commerce, create new markets, and furnish avenues to otherwise
isolated communities.

I have already adverted to the suggested construction of a ship railway
across the narrow formation of the territory of Mexico at Tehuantepec.

With the gradual recovery of Peru from the effects of her late disastrous
conflict with Chile, and with the restoration of civil authority in that
distracted country, it is hoped that pending war claims of our citizens
will be adjusted.

In conformity with notification given by the Government of Peru, the
existing treaties of commerce and extradition between the United States and
that country will terminate March 31, 1886.

Our good relationship with Russia continues.

An officer of the Navy, detailed for the purpose, is now on his way to
Siberia bearing the testimonials voted by Congress to those who generously
succored the survivors of the unfortunate Jeannette expedition.

It is gratifying to advert to the cordiality of our intercourse with
Spain.

The long-pending claim of the owners of the ship Masonic for loss suffered
through the admitted dereliction of the Spanish authorities in the
Philippine Islands has been adjusted by arbitration and an indemnity
awarded. The principle of arbitration in such cases, to which the United
States have long and consistently adhered, thus receives a fresh and
gratifying confirmation.

Other questions with Spain have been disposed of or are under diplomatic
consideration with a view to just and honorable settlement.

The operation of the commercial agreement with Spain of January 2--February
13, 1884, has been found inadequate to the commercial needs of the United
States and the Spanish Antilies, and the terms of the agreement are
subjected to conflicting interpretations in those islands.

Negotiations have been instituted at Madrid for a full treaty not open to
these objections and in the line of the general policy touching the
neighborly intercourse of proximate communities, to which I elsewhere
advert, and aiming, moreover, at the removal of existing burdens and
annoying restrictions; and although a satisfactory termination is promised,
I am compelled to delay its announcement.

An international copyright conference was held at Berne in September, on
the invitation of the Swiss Government. The envoy of the United States
attended as a delegate, but refrained from committing this Government to
the results, even by signing the recommendatory protocol adopted. The
interesting and important subject of international copyright has been
before you for several years. Action is certainly desirable to effect the
object in view; and while there may be question as to the relative
advantage of treating it by legislation or by specific treaty, the matured
views of the Berne conference can not fail to aid your consideration of the
subject.

The termination of the commercial treaty of 1862 between the United States
and Turkey has been sought by that Government. While there is question as
to the sufficiency of the notice of termination given, yet as the
commercial rights of our citizens in Turkey come under the favored-nation
guaranties of the prior treaty of 1830, and as equal treatment is admitted
by the Porte, no inconvenience can result from the assent of this
Government to the revision of the Ottoman tariffs, in which the treaty
powers have been invited to join.

Questions concerning our citizens in Turkey may be affected by the Porte's
nonacquiescence in the right of expatriation and by the imposition of
religious tests as a condition of residence, in which this Government can
not concur. The United States must hold in their intercourse with every
power that the status of their citizens is to be respected and equal civil
privileges accorded to them without regard to creed, and affected by no
considerations save those growing out of domiciliary return to the land of
original allegiance or of unfulfilled personal obligations which may
survive, under municipal laws, after such voluntary return.

The negotiation with Venezuela relative to the rehearing of the awards of
the mixed commission constituted under the treaty of 1866 was resumed in
view of the recent acquiescence of the Venezuelan envoy in the principal
point advanced by this Government, that the effects of the old treaty could
only be set aside by the operation of a new convention. A result in
substantial accord with the advisory suggestions contained in the joint
resolution of March 3, 1883, has been agreed upon and will shortly be
submitted to the Senate for ratification.

Under section 3659 of the Revised Statutes all funds held in trust by the
United States and the annual interest accruing thereon, when not otherwise
required by treaty, are to be invested in stocks of the United States
bearing a rate of interest not less than 5 per cent per annum. There being
now no procurable stocks paying so high a rate of interest, the letter of
the statute is at present inapplicable, but its spirit is subserved by
continuing to make investments of this nature in current stocks bearing the
highest interest now paid. The statute, however, makes no provision for the
disposal of such accretions. It being contrary to the general rule of this
Government to allow interest on claims, I recommend the repeal of the
provision in question and the disposition, under a uniform rule, of the
present accumulations from investment of trust funds.

The inadequacy of existing legislation touching citizenship and
naturalization demands your consideration.

While recognizing the right of expatriation, no statutory provision exists
providing means for renouncing citizenship by an American citizen, native
born or naturalized, nor for terminating and vacating an improper
acquisition of citizenship. Even a fraudulent decree of naturalization can
not now be canceled. The privilege and franchise of American citizenship
should be granted with care, and extended to those only who intend in good
faith to assume its duties and responsibilities when attaining its
privileges and benefits. It should be withheld from those who merely go
through the forms of naturalization with the intent of escaping the duties
of their original allegiance without taking upon themselves those of their
new status, or who may acquire the rights of American citizenship for no
other than a hostile purpose toward their original governments. These evils
have had many flagrant illustrations.

I regard with favor the suggestion put forth by one of my predecessors that
provision be made for a central bureau of record of the decrees of
naturalization granted by the various courts throughout the United States
now invested with that power.

The rights which spring from domicile in the United States, especially when
coupled with a declaration of intention to become a citizen, are worthy of
definition by statute. The stranger coming hither with intent to remain,
establishing his residence in our midst, contributing to the general
welfare, and by his voluntary act declaring his purpose to assume the
responsibilities of citizenship, thereby gains an inchoate status which
legislation may properly define. The laws of certain States and Territories
admit a domiciled alien to the local franchise, conferring on him the
rights of citizenship to a degree which places him in the anomalous
position of being a citizen of a State and yet not of the United States
within the purview of Federal and international law.

It is important within the scope of national legislation to define this
right of alien domicile as distinguished from Federal naturalization.

The commercial relations of the United States with their immediate
neighbors and with important areas of traffic near our shores suggest
especially liberal intercourse between them and us.

Following the treaty of 1883 with Mexico, which rested on the basis of a
reciprocal exemption from customs duties, other similar treaties were
initiated by my predecessor.

Recognizing the need of less obstructed traffic with Cuba and Puerto Rico,
and met by the desire of Spain to succor languishing interests in the
Antilles, steps were taken to attain those ends by a treaty of commerce. A
similar treaty was afterwards signed by the Dominican Republic.
Subsequently overtures were made by Her Britannic Majesty's Government for
a like mutual extension of commercial intercourse with the British West
Indian and South American dependencies, but without result.

On taking office I withdrew for reexamination the treaties signed with
Spain and Santo Domingo, then pending before the Senate. The result has
been to satisfy me of the inexpediency of entering into engagements of this
character not covering the entire traffic.

These treaties contemplated the surrender by the United States of large
revenues for inadequate considerations. Upon sugar alone duties were
surrendered to an amount far exceeding all the advantages offered in
exchange. Even were it intended to relieve our consumers, it was evident
that so long as the exemption but partially covered our importation such
relief would be illusory. To relinquish a revenue so essential seemed
highly improvident at a time when new and large drains upon the Treasury
were contemplated. Moreover, embarrassing questions would have arisen under
the favored-nation clauses of treaties with other nations.

As a further objection, it is evident that tariff regulation by treaty
diminishes that independent control over its own revenues which is
essential for the safety and welfare of any government. Emergency calling
for an increase of taxation may at any time arise, and no engagement with a
foreign power should exist to hamper the action of the Government.

By the fourteenth section of the shipping act approved June 26, 1884,
certain reductions and contingent exemptions from tonnage dues were made as
to vessels entering ports of the United States from any foreign port in
North and Central America, the West India Islands, the Bahamas and
Bermudas, Mexico, and the Isthmus as far as Aspinwall and Panama. The
Governments of Belgium, Denmark, Germany, Portugal, and Sweden and Norway
have asserted, under the favored-nation clause in their treaties with the
United States, a claim to like treatment in respect of vessels coming to
the United States from their home ports. This Government, however, holds
that the privileges granted by the act are purely geographical, inuring to
any vessel of any foreign power that may choose to engage in traffic
between this country and any port within the defined zone, and no warrant
exists under the most-favored-nation clause for the extension of the
privileges in question to vessels sailing to this country from ports
outside the limitation of the act.

Undoubtedly the relations of commerce with our near neighbors, whose
territories form so long a frontier line difficult to be guarded, and who
find in our country, and equally offer to us, natural markets, demand
special and considerate treatment. It rests with Congress to consider what
legislative action may increase facilities of intercourse which contiguity
makes natural and desirable.

I earnestly urge that Congress recast the appropriations for the
maintenance of the diplomatic and consular service on a footing
commensurate with the importance of our national interests. At every post
where a representative is necessary the salary should be so graded as to
permit him to live with comfort. With the assignment of adequate salaries
the so-called notarial extra official fees, which our officers abroad are
now permitted to treat as personal perquisites, should be done away with.
Every act requiring the certification and seal of the officer should be
taxable at schedule rates and the fee therefor returned to the Treasury. By
restoring these revenues to the public use the consular service would be
self-supporting, even with a liberal increase of the present low salaries.

In further prevention of abuses a system of consular inspection should be
instituted.

The appointment of a limited number of secretaries of legation at large, to
be assigned to duty wherever necessary, and in particular for temporary
service at missions which for any cause may be without a head, should also
be authorized.

I favor also authorization for the detail of officers of the regular
service as military or naval attaches at legations.

Some foreign governments do not recognize the union of consular with
diplomatic functions. Italy and Venezuela will only receive the appointee
in one of his two capacities, but this does not prevent the requirement of
a bond and submission to the responsibilities of an office whose duties he
can not discharge. The superadded title of consul-general should be
abandoned at all missions.

I deem it expedient that a well-devised measure for the reorganization of
the extraterritorial courts in Oriental countries should replace the
present system, which labors under the disadvantage of combining judicial
and executive functions in the same office.

In several Oriental countries generous offers have been made of premises
for housing the legations of the United States. A grant of land for that
purpose was made some years since by Japan, and has been referred to in the
annual messages of my predecessor. The Siamese Government has made a gift
to the United States of commodious quarters in Bangkok. In Korea the late
minister was permitted to purchase a building from the Government for
legation use. In China the premises rented for the legation are favored as
to local charges. At Tangier the house occupied by our representative has
been for many years the property; this Government, having been given for
that purpose in 1822 by the Sultan of Morocco. I approve the suggestion
heretofore made, that, view of the conditions of life and administration in
the Eastern countries, the legation buildings in China, Japan, Korea, Siam,
and perhaps Persia, should be owned and furnished by the Government with a
view to permanency and security. To this end I recommend that authority be
given to accept the gifts adverted to in Japan and Siam, and to purchase in
the other countries named, with provision for furniture and repairs. A
considerable saving in rentals would result.

The World's Industrial Exposition, held at New Orleans last winter, with
the assistance of the Federal Government, attracted a large number of
foreign exhibits, and proved of great value in spreading among the
concourse of visitors from Mexico and Central and South America a wider
knowledge of the varied manufactures and productions of this country and
their availability in exchange for the productions of those regions.

Past Congresses have had under consideration the advisability of abolishing
the discrimination made by the tariff laws in favor of the works of
American artists. The odium of the policy which subjects to a high rate of
duty the paintings of foreign artists and exempts the productions of
American artists residing abroad, and who receive gratuitously advantages
and instruction, is visited upon our citizens engaged in art culture in
Europe, and has caused them with practical unanimity to favor the abolition
of such an ungracious distinction; and in their interest, and for other
obvious reasons, I strongly recommend it.

The report of the Secretary of the Treasury fully exhibits the condition of
the public finances and of the several branches of the Government connected
with his Department. The suggestions of the Secretary relating to the
practical operations of this important Department, and his recommendations
in the direction of simplification and economy, particularly in the work of
collecting customs duties, are especially urged upon the attention of
Congress.

The ordinary receipts from all sources for the fiscal year ended June 30,
1885, were $322,690,706.38. Of this sum $181,471,939.34 was received from
customs and $112,498,725.54 from internal revenue. The total receipts, as
given above, were $24,829,163.54 less than those for the year ended June
30, 1884. This diminution embraces a falling off of $13,595,550.42 in the
receipts from customs and $9,687,346.97 in the receipts from internal
revenue.

The total ordinary expenditures of the Government for the fiscal year were
$260,226,935.50, leaving a surplus in the Treasury at the close of the year
of $63,463,771.27. This is $40,929,854.32 less than the surplus reported at
the close of the previous year.

The expenditures are classified as follows:

The amount paid on the public debt during the fiscal year ended June 30,
1885, was $45,993,235.43, and there has been paid since that date and up to
November 1, 1885, the sum of $369,828, leaving the amount of the debt at
the last-named date $1,514,475,860.47. There was however, at that time in
the Treasury, applicable to the general purposes of the Government, the sum
of $66,818,292.38.

The total receipts for the current fiscal year ending June 30, 1886,
ascertained to October 1, 1885, and estimated for the remainder of the
year, are $315,000,000. The expenditures ascertained and estimated for the
same time are $245,000,000, leaving a surplus at the close of the year
estimated at $70,000,000.

The value of the exports from the United States to foreign countries during
the last fiscal year was as follows:

Some of the principal exports, with their values and the percentage they
respectively bear to the total exportation, are given as follows:

Our imports during the year were as follows:

The following are given as prominent articles of import during the year,
with their values and the percentage they bear to the total importation:

Of the entire amount of duties collected 70 per cent was collected from the
following articles of import:

The fact that our revenues are in excess of the actual needs of all
economical administration of the Government justifies a reduction in the
amount exacted from the people for its support. Our Government is but the
means established by the will of a free people by which certain principles
are applied which they have adopted for their benefit and protection; and
it is never better administered and its true spirit is never better
observed than when the people's taxation for its support is scrupulously
limited to the actual necessity of expenditure and distributed according to
a just and equitable plan.

The proposition with which we have to deal is the reduction of the revenue
received by the Government, and indirectly paid by the people, from customs
duties. The question of free trade is not involved, nor is there now any
occasion for the general discussion of the wisdom or expediency of a
protective system.

Justice and fairness dictate that in any modification of our present laws
relating to revenue the industries and interests which have been encouraged
by such laws, and in which our citizens have large investments, should not
be ruthlessly injured or destroyed. We should also deal with the subject in
such manner as to protect the interests of American labor, which is the
capital of our workingmen. Its stability and proper remuneration furnish
the most justifiable pretext for a protective policy.

Within these limitations a certain reduction should be made in our customs
revenue. The amount of such reduction having been determined, the inquiry
follows, Where can it best be remitted and what articles can best be
released from duty in the interest of our citizens?

I think the reduction should be made in the revenue derived from a tax upon
the imported necessaries of life. We thus directly lessen the cost of
living in every family of the land and release to the people in every
humble home a larger measure of the rewards of frugal industry.

During the year ended November 1, 1885, 145 national banks were organized,
with an aggregate capital of $16,938,000, and circulating notes have been
issued to them amounting to $4,274,910. The whole number of these banks in
existence on the day above mentioned was 2,727.

The very limited amount of circulating notes issued by our national banks,
compared with the amount the law permits them to issue upon a deposit of
bonds for their redemption, indicates that the volume of our circulating
medium may be largely increased through this instrumentality.

Nothing more important than the present condition of our currency and
coinage can claim your attention.

Since February, 1878, the Government has, under the compulsory provisions
of law, purchased silver bullion and coined the same at the rate of more
than $2,000,000 every month. By this process up to the present date
215,759,431 silver dollars have been coined.

A reasonable appreciation of a delegation of power to the General
Government would limit its exercise, without express restrictive words, to
the people's needs and the requirements of the public welfare.

Upon this theory the authority to "coin money" given to Congress by the
Constitution, if it permits the purchase by the Government of bullion for
coinage in any event, does not justify such purchase and coinage to an
extent beyond the amount needed for a sufficient circulating medium.

The desire to utilize the silver product of the country should not lead to
a misuse or the perversion of this power.

The necessity for such an addition to the silver currency of the nation as
is compelled by the silver-coinage act is negatived by the fact that up to
the present time only about 50,000,000 of the silver dollars so coined have
actually found their way into circulation, leaving more than 165,000,000 in
the possession of the Government, the custody of which has entailed a
considerable expense for the construction of vaults for it deposit. Against
this latter amount there are outstanding silver certificates amounting to
about $93,000,000.

Every month two millions of gold in the public Treasury are paid our for
two millions or more of silver dollars, to be added to the idle mass
already accumulated.

If continued long enough, this operation will result in the substitution of
silver for all the gold the Government owns applicable to its general
purposes. It will not do to rely upon the customs receipts of the
Government to make good this drain of gold, because the silver thus coined
having been made legal tender for all debts and dues, public and private,
at times during the last six months 58 per cent of the receipts for duties
has been in silver or silver certificates, while the average within that
period has been 20 per cent. The proportion of silver and its certificates
received by the Government will probably increase as time goes on, for the
reason that the nearer the period approaches when it will be obliged to
offer silver in payment of its obligations the greater inducement there
will be to hoard gold against depreciation in the value of silver or for
the purpose of speculating.

This hoarding of gold has already begun.

When the time comes that gold has been withdrawn from circulation, then
will be apparent the difference between the real value of the silver dollar
and a dollar in gold, and the two coins will part company. Gold, still the
standard of value and necessary in our dealings with other countries, will
be at a premium over silver; banks which have substituted gold for the
deposits of their customers may pay them with silver bought with such gold,
thus making a handsome profit; rich speculators will sell their hoarded
gold to their neighbors who need it to liquidate their foreign debts, at a
ruinous premium over silver, and the laboring men and women of the land,
most defenseless of all, will find that the dollar received for the wage of
their toil has sadly shrunk in its purchasing power. It may be said that
the latter result will be but temporary, and that ultimately the price of
labor will be adjusted to the change; but even if this takes place the
wage-worker can not possibly gain, but must inevitably lose, since the
price he is compelled to pay for his living will not only be measured in a
coin heavily depreciated and fluctuating and uncertain in its value, but
this uncertainty in the value of the purchasing medium will be made the
pretext for an advance in prices beyond that justified by actual
depreciation.

The words uttered in 1834 by Daniel Webster in the Senate of the United
States are true to-day: The very man of all others who has the deepest
interest in a sound currency, and who suffers most by mischievous
legislation in money matters, is the man who earns his daily bread by his
daily toil. The most distinguished advocate of bimetallism, discussing our
silver coinage, has lately written: No American citizen's hand has yet felt
the sensation of cheapness, either in receiving or expending the silver-act
dollars. And those who live by labor or legitimate trade never will feel
that sensation of cheapness. However plenty silver dollars may become, they
will not be distributed as gifts among the people; and if the laboring man
should receive four depreciated dollars where he now receives but two, he
will pay in the depreciated coin more than double the price he now pays for
all the necessaries and comforts of life.

Those who do not fear any disastrous consequences arising from the
continued compulsory coinage of silver as now directed by law, and who
suppose that the addition to the currency of the country intended as its
result will be a public benefit, are reminded that history demonstrates
that the point is easily reached in the attempt to float at the same time
two sorts of money of different excellence when the better will cease to be
in general circulation. The hoarding of gold which has already taken place
indicates that we shall not escape the usual experience in such cases. So
if this silver coinage be continued we may reasonably expect that gold and
its equivalent will abandon the field of circulation to silver alone. This
of course must produce a severe contraction of our circulating medium,
instead of adding to it.

It will not be disputed that any attempt on the part of the Government to
cause the circulation of silver dollars worth 80 cents side by side with
gold dollars worth 100 cents, even within the limit that legislation does
not run counter to the laws of trade, to be successful must be seconded by
the confidence of the people that both coins will retain the same
purchasing power and be interchangeable at will. A special effort has been
made by the Secretary of the Treasury to increase the amount of our silver
coin in circulation; but the fact that a large share of the limited amount
thus put out has soon returned to the public Treasury in payment of duties
leads to the belief that the people do not now desire to keep it in hand,
and this, with the evident disposition to hoard gold, gives rise to the
suspicion that there already exists a lack of confidence among the people
touching our financial processes. There is certainly not enough silver now
in circulation to cause uneasiness, and the whole amount coined and now on
hand might after a time be absorbed by the people without apprehension; but
it is the ceaseless stream that threatens to overflow the land which causes
fear and uncertainty.

What has been thus far submitted upon this subject relates almost entirely
to considerations of a home nature, unconnected with the bearing which the
policies of other nations have upon the question. But it is perfectly
apparent that a line of action in regard to our currency can not wisely be
settled upon or persisted in without considering the attitude on the
subject of other countries with whom we maintain intercourse through
commerce, trade, and travel. An acknowledgment of this fact is found in the
act by virtue of which our silver is compulsorily coined. It provides
that--The President shall invite the governments of the countries
composing the Latin Union, so called, and of such other European nations as
he may deem advisable, to join the United States in a conference to adopt a
common ratio between gold and silver for the purpose of establishing
internationally the use of bimetallic money and securing fixity of relative
value between those metals. This conference absolutely failed, and a
similar fate has awaited all subsequent efforts in the same direction. And
still we continue our coinage of silver at a ratio different from that of
any other nation. The most vital part of the silver-coinage act remains
inoperative and unexecuted, and without an ally or friend we battle upon
the silver field in an illogical and losing contest.

To give full effect to the design of Congress on this subject I have made
careful and earnest endeavor since the adjournment of the last Congress.

To this end I delegated a gentleman well instructed in fiscal science to
proceed to the financial centers of Europe and, in conjunction with our
ministers to England, France, and Germany, to obtain a full knowledge of
the attitude and intent of those governments in respect of the
establishment of such an international ratio as would procure free coinage
of both metals at the mints of those countries and our own. By my direction
our consul-general at Paris has given close attention to the proceedings of
the congress of the Latin Union, in order to indicate our interest in its
objects and report its action.

It may be said in brief, as the result of these efforts, that the attitude
of the leading powers remains substantially unchanged since the monetary
conference of 1881, nor is it to be questioned that the views of these
governments are in each instance supported by the weight of public
opinion.

The steps thus taken have therefore only more fully demonstrated the
uselessness of further attempts at present to arrive at any agreement on
the subject with other nations.

In the meantime we are accumulating silver coin, based upon our own
peculiar ratio, to such an extent, and assuming so heavy a burden to be
provided for in any international negotiations, as will render us an
undesirable party to any future monetary conference of nations.

It is a significant fact that four of the five countries composing the
Latin Union mentioned in our coinage act, embarrassed with their silver
currency, have just completed an agreement among themselves that no more
silver shall be coined by their respective Governments and that such as has
been already coined and in circulation shall be redeemed in gold by the
country of its coinage. The resort to this expedient by these countries may
well arrest the attention of those who suppose that we can succeed without
shock or injury in the attempt to circulate upon its merits all the silver
we may coin under the provisions of our silver-coinage act.

The condition in which our Treasury may be placed by a persistence in our
present course is a matter of concern to every patriotic citizen who does
not desire his Government to pay in silver such of its obligations as
should be paid in gold. Nor should our condition be such as to oblige us,
in a prudent management of our affairs, to discontinue the calling in and
payment of interest-bearing obligations which we have the right now to
discharge, and thus avoid the payment of further interest thereon.

The so-called debtor class, for whose benefit the continued compulsory
coinage of silver is insisted upon, are not dishonest because they are in
debt, and they should not be suspected of a desire to jeopardize the
financial safety of the country in order that they may cancel their present
debts by paying the same in depreciated dollars. Nor should it be forgotten
that it is not the rich nor the money lender alone that must submit to such
a readjustment, enforced by the Government and their debtors. The pittance
of the widow and the orphan and the incomes of helpless beneficiaries of
all kinds would be disastrously reduced. The depositors in savings banks
and in other institutions which hold in trust the savings of the poor, when
their little accumulations are scaled down to meet the new order of things,
would in their distress painfully realize the delusion of the promise made
to them that plentiful money would improve their condition.

We have now on hand all the silver dollars necessary to supply the present
needs of the people and to satisfy those who from sentiment wish to see
them in circulation, and if their coinage is suspended they can be readily
obtained by all who desire them. If the need of more is at anytime
apparent, their coinage may be renewed.

That disaster has not already overtaken us furnishes no proof that danger
does not wait upon a continuation of the present silver coinage. We have
been saved by the most careful management and unusual expedients, by a
combination of fortunate conditions, and by a confident expectation that
the course of the Government in regard to silver coinage would be speedily
changed by the action of Congress.

Prosperity hesitates upon our threshold because of the dangers and
uncertainties surrounding this question. Capital timidly shrinks from
trade, and investors are unwilling to take the chance of the questionable
shape in which their money will be returned to them, while enterprise halts
at a risk against which care and sagacious management do not protect.

As a necessary consequence, labor lacks employment and suffering and
distress are visited upon a portion of our fellow-citizens especially
entitled to the careful consideration of those charged with the duties of
legislation. No interest appeals to us so strongly for a safe and stable
currency as the vast army of the unemployed.

I recommend the suspension of the compulsory coinage of silver dollars,
directed by the law passed in February, 1878.

The Steamboat-Inspection Service on the 30th day of June, 1885, was
composed of 140 persons, including officers, clerks, and messengers. The
expenses of the service over the receipts were $138,822.22 during the
fiscal year. The special inspection of foreign steam vessels, organized
under a law passed in 1882, was maintained during the year at an expense of
$36,641.63. Since the close of the fiscal year reductions have been made in
the force employed which will result in a saving during the current year of
$17,000 without affecting the efficiency of the service.

The Supervising Surgeon-General reports that during the fiscal year 41,714
patients have received relief through the Marine-Hospital Service, of whom
12,803 were treated in hospitals and 28,911 at the dispensaries.

Active and effective efforts have been made through the medium of this
service to protect the country against an invasion of cholera, which has
prevailed in Spain and France, and the smallpox, which recently broke out
in Canada.

The most gratifying results have attended the operations of the Life Saving
Service during the last fiscal year. The observance of the provision of law
requiring the appointment of the force employed in this service to be made
"solely with reference to their fitness, and without reference to their
political or party affiliation," has secured the result which may
confidently be expected in any branch of public employment where such a
rule is applied. As a consequence, this service is composed of men well
qualified for the performance of their dangerous and exceptionally
important duties.

The number of stations in commission at the close of the year was 203. The
number of disasters to vessels and craft of all kinds within their field of
action was 371. The number of persons endangered in such disasters was
2,439, of whom 2,428 were saved and only 11 lost. Other lives which were
imperiled, though not by disasters to shipping, were also rescued, and a
large amount of property was saved through the aid of this service. The
cost of its maintenance during the year was $828,474.43.

The work of the Coast and Geodetic Survey was during the last fiscal year
carried on within the boundaries and off the coasts of thirty-two States,
two Territories, and the District of Columbia. In July last certain
irregularities were found to exist in the management of this Bureau, which
led to a prompt investigation of its methods. The abuses which were brought
to light by this examination and the reckless disregard of duty and the
interests of the Government developed on the part of some of those
connected with the service made a change of superintendency and a few of
its other officers necessary. Since the Bureau has been in new hands an
introduction of economies and the application of business methods have
produced an important saving to the Government and a promise of more useful
results.

This service has never been regulated by anything but the most indefinite
legal enactments and the most unsatisfactory rules. It was many years ago
sanctioned apparently for a purpose regarded as temporary and related to a
survey of our coast. Having gained a place in the appropriations made by
Congress, it has gradually taken to itself powers and objects not
contemplated in its creation and extended its operations until it sadly
needs legislative attention.

So far as a further survey of our coast is concerned, there seems to be a
propriety in transferring that work to the Navy Department. The other
duties now in charge of this establishment, if they can not be profitably
attached to some existing Department or other bureau, should be prosecuted
under a law exactly defining their scope and purpose, and with a careful
discrimination between the scientific inquiries which may properly be
assumed by the Government and those which should be undertaken by State
authority or by individual enterprise.

It is hoped that the report of the Congressional committee heretofore
appointed to investigate this and other like matters will aid in the
accomplishment of proper legislation on this subject.

The report of the Secretary of War is herewith submitted. The attention of
Congress is invited to the detailed account which it contains of the
administration of his Department, and his recommendations and suggestions
for the improvement of the service.

The Army consisted, at the date of the last consolidated returns, of 2,154
officers and 24,705 enlisted men.

The expenses of the Departments for the fiscal year ended June, 30, 1885,
including $13,164,394.60 for public works and river and harbor
improvements, were $45,850,999.54.

Besides the troops which were dispatched in pursuit of the small band of
Indians who left their reservation in Arizona and committed murders and
outrages, two regiments of cavalry and one of infantry were sent last July
to the Indian Territory to prevent an outbreak which seemed imminent. They
remained to aid, if necessary, in the expulsion of intruders upon the
reservation, who seemed to have caused the discontent among the Indians,
but the Executive proclamation warning them to remove was complied with
without their interference.

Troops were also sent to Rock Springs, in Wyoming Territory, after the
massacre of Chinese there, to prevent further disturbance, and afterwards
to Seattle, in Washington Territory, to avert a threatened attack upon
Chinese laborers and domestic violence there. In both cases the mere
presence of the troops had the desired effect.

It appears that the number of desertions has diminished, but that during
the last fiscal year they numbered 2,927; and one instance is given by the
Lieutenant-General of six desertions by the same recruit. I am convinced
that this number of desertions can be much diminished by better discipline
and treatment; but the punishment should be increased for repeated
offenses.

These desertions might also be reduced by lessening the term of first
enlistments, thus allowing a discontented recruit to contemplate a nearer
discharge and the Army a profitable riddance. After one term of service a
reenlistment would be quite apt to secure a contented recruit and a good
soldier.

The Acting Judge-Advocate-General reports that the number of trials by
general courts-martial during the year was 2,328, and that 11,851 trials
took place before garrison and regimental courts-martial. The suggestion
that probably more than half the Army have been tried for offenses, great
and small, in one year may well arrest attention. Of course many of these
trials before garrison and regimental courts-martial were for offenses
almost frivolous, and there should, I think, be a way devised to dispose of
these in a more summary and less inconvenient manner than by
court-martial.

If some of the proceedings of courts-martial which I have had occasion to
examine present the ideas of justice which generally prevail in these
tribunals, I am satisfied that they should be much reformed if the honor
and the honesty of the Army and Navy are by their instrumentality to be
vindicated and protected.

The Board on Fortifications or other defenses, appointed in pursuance of
the provisions of the act of Congress approved March 3, 1885, will in a
short time present their report, and it is hoped that this may greatly aid
the legislation so necessary to remedy the present defenseless condition of
our seacoasts.

The work of the Signal Service has been prosecuted during the last year
with results of increasing benefit to the country. The field of instruction
has been enlarged with a view of adding to its usefulness. The number of
stations in operation June 30, 1885, was 489. Telegraphic reports are
received daily from 160 stations. Reports are also received from 25
Canadian stations, 375 volunteer observers, 52 army surgeons at military
posts, and 333 foreign stations. The expense of the service during the
fiscal year, after deducting receipts from military telegraph lines, was
$792,592.97. In view of the fact referred to by the Secretary of War, that
the work of this service ordinarily is of a scientific nature, and the
further fact that it is assuming larger proportions constantly and becoming
more and more unsuited to the fixed rules which must govern the Army, I am
inclined to agree with him in the opinion that it should be separately
established. If this is done, the scope and extent of its operations
should, as nearly as possible, be definitely prescribed by law and always
capable of exact ascertainment.

The Military Academy at West Point is reported as being in a high state of
efficiency and well equipped for the satisfactory accomplishment of the
purposes of its maintenance.

The fact that the class which graduates next year is an unusually large one
has constrained me to decline to make appointments to second lieutenancies
in the Army from civil life, so that such vacancies as exist in these
places may be reserved for such graduates; and yet it is not probable that
there will be enough vacancies to provide positions for them all when they
leave the military school. Under the prevailing law and usage those not
thus assigned to duty never actively enter the military service. It is
suggested that the law on this subject be changed so that such of these
young men as are not at once assigned to duty after graduation may be
retained as second lieutenants in the Army if they desire it, subject to
assignment when opportunity occurs, and under proper rules as to priority
of selection.

The expenditures on account of the Military Academy for the last fiscal
year, exclusive of the sum taken for its purposes from appropriations for
the support of the Army, were $290,712.07.

The act approved March 3, 1885, designed to compensate officers and
enlisted men for loss of private property while in the service of the
United States, is so indefinite in its terms and apparently admits so many
claims the adjustment of which could not have been contemplated that if it
is to remain upon the statute book it needs amendment.

There should be a general law of Congress prohibiting the construction of
bridges over navigable waters in such manner as to obstruct navigation,
with provisions for preventing the same. It seems that under existing
statutes the Government can not intervene to prevent such a construction
when entered upon without its consent, though when such consent is asked
and granted upon condition the authority to insist upon such condition is
clear. Thus it is represented that while the officers of the Government are
with great care guarding against the obstruction of navigation by a bridge
across the Mississippi River at St. Paul a large pier for a bridge has been
built just below this place directly in the navigable channel of the river.
If such things are to be permitted, a strong argument is presented against
the appropriation of large sums of money to improve the navigation of this
and other important highways of commerce.

The report of the Secretary of the Navy gives a history of the operations
of his Department and the present condition of the work committed to his
charge.

He details in full the course pursued by him to protect the rights of the
Government in respect of certain vessels unfinished at the time of his
accession to office, and also concerning the dispatch boat Dolphin, claimed
to be completed and awaiting the acceptance of the Department. No one can
fail to see from recitals contained in this report that only the
application of business principles has been insisted upon in the treatment
of these subjects, and that whatever controversy has arisen was caused by
the exaction on the part of the Department of contract obligations as they
were legally construed. In the case of the Dolphin, with entire justice to
the contractor, an agreement has been entered into providing for the
ascertainment by a judicial inquiry of the complete or partial compliance
with the contract in her construction, and further providing for the
assessment of any damages to which the Government may be entitled on
account of a partial failure to perform such contract, or the payment of
the sum still remaining unpaid upon her price in case a full performance is
adjudged.

The contractor, by reason of his failure in business, being unable to
complete the other three vessels, they were taken possession of by the
Government in their unfinished state under a clause in the contract
permitting such a course, and are now in process of completion in the yard
of the contractor, but under the supervision of the Navy Department.

Congress at its last session authorized the construction of two additional
new cruisers and two gunboats, at a cost not exceeding in the aggregate
$2,995,000. The appropriation for this purpose having become available on
the 1st day of July last, steps were at once taken for the procurement of
such plans for the construction of these vessels as would be likely to
insure their usefulness when completed. These are of the utmost importance,
considering the constant advance in the art of building vessels of this
character, and the time is not lost which is spent in their careful
consideration and selection.

All must admit the importance of an effective navy to a nation like ours,
having such an extended seacoast to protect; and yet we have not a single
vessel of war that could keep the seas against a first-class vessel of any
important power. Such a condition ought not longer to continue. The nation
that can not resist aggression is constantly exposed to it. Its foreign
policy is of necessity weak and its negotiations are conducted with
disadvantage because it is not in condition to enforce the terms dictated
by its sense of right and justice.

Inspired, as I am, by the hope, shared by all patriotic citizens, that the
day is not very far distant when our Navy will be such as befits our
standing among the nations of the earth, and rejoiced at every step that
leads in the direction of such a consummation, I deem it my duty to
especially direct the attention of Congress to the close of the report of
the Secretary of the Navy, in which the humiliating weakness of the present
organization of his Department is exhibited and the startling abuses and
waste of its present methods are exposed. The conviction is forced upon us
with the certainty of mathematical demonstration that before we proceed
further in the restoration of a Navy we need a thoroughly reorganized Navy
Department. The fact that within seventeen years more than $75,000,000 have
been spent in the construction, repair, equipment, and armament of vessels,
and the further fact that instead of an effective and creditable fleet we
have only the discontent and apprehension of a nation undefended by war
vessels, added to the disclosures now made, do not permit us to doubt that
every attempt to revive our Navy has thus far for the most part been
misdirected, and all our efforts in that direction have been little better
than blind gropings and expensive, aimless follies.

Unquestionably if we are content with the maintenance of a Navy Department
simply as a shabby ornament to the Government, a constant watchfulness may
prevent some of the scandal and abuse which have found their way into our
present organization, and its incurable waste may be reduced to the
minimum. But if we desire to build ships for present usefulness instead of
naval reminders of the days that are past, we must have a Department
organized for the work, supplied with all the talent and ingenuity our
country affords, prepared to take advantage of the experience of other
nations, systematized so that all effort shall unite and lead in one
direction, and fully imbued with the conviction that war vessels, though
new, are useless unless they combine all that the ingenuity of man has up
to this day brought forth relating to their construction.

I earnestly commend the portion of the Secretary's report devoted to this
subject to the attention of Congress, in the hope that his suggestions
touching the reorganization of his Department may be adopted as the first
step toward the reconstruction of our Navy.

The affairs of the postal service are exhibited by the report of the
Postmaster-General, which will be laid before you.

The postal revenue, whose ratio of gain upon the rising prosperity of 1882
and 1883 outstripped the increasing expenses of our growing service, was
checked by the reduction in the rate of letter postage which took effect
with the beginning of October in the latter year, and it diminished during
the two past fiscal years $2,790,000, in about the proportion of $2,270,000
in 1884 to $520,000 in 1885. Natural growth and development have meantime
increased expenditure, resulting in a deficiency in the revenue to meet the
expenses of the Department of five and a quarter million dollars for the
year 1884 and eight and a third million in the last fiscal year. The
anticipated and natural revival of the revenue has been oppressed and
retarded by the unfavorable business condition of the country, of which the
postal service is a faithful indicator. The gratifying fact is shown,
however, by the report that our returning prosperity is marked by a gain of
$380,000 in the revenue of the latter half of the last year over the
corresponding period of the preceding year.

The change in the weight of first-class matter which may be carried for a
single rate of postage from a half ounce to an ounce, and the reduction by
one-half of the rate of newspaper postage, which, under recent legislation,
began with the current year, will operate to restrain the augmentation of
receipts which otherwise might have been expected to such a degree that the
scale of expense may gain upon the revenue and cause an increased
deficiency to be shown at its close. Yet, after no long period of
reawakened prosperity, by proper economy it is confidently anticipated that
even the present low rates, now as favorable as any country affords, will
be adequate to sustain the cost of the service.

The operation of the Post-Office Department is for the convenience and
benefit of the people, and the method by which they pay the charges of this
useful arm of their public service, so that it be just and impartial, is of
less importance to them than the economical expenditure of the means they
provide for its maintenance and the due improvement of its agencies, so
that they may enjoy its highest usefulness.

A proper attention has been directed to the prevention of waste or
extravagance, and good results appear from the report to have already been
accomplished.

I approve the recommendation of the Postmaster-General to reduce the
charges on domestic money orders of $5 and less from 8 to 5 cents. This
change will materially aid those of our people who most of all avail
themselves of this instrumentality, but to whom the element of cheapness is
of the greatest importance. With this reduction the system would still
remain self-supporting.

The free-delivery system has been extended to 19 additional cities during
the year, and 178 now enjoy its conveniences. Experience has commended it
to those who enjoy its benefits, and further enlargement of its facilities
is due to other communities to which it is adapted. In the cities where it
has been established, taken together the local postage exceeds its
maintenance by nearly $1,300,000. The limit to which this system is now
confined by law has been nearly reached, and the reasons given justify its
extension, which is proposed.

It was decided, with my approbation, after a sufficient examination, to be
inexpedient for the Post-Office Department to contract for carrying our
foreign mails under the additional authority given by the last Congress.
The amount limited was inadequate to pay all within the purview of the law
the full rate of 50 cents per mile, and it would have been unjust and
unwise to have given it to some and denied it to others. Nor could
contracts have been let under the law to all at a rate to have brought the
aggregate within the appropriation without such practical prearrangement of
terms as would have violated it.

The rate of sea and inland postage which was proffered under another
statute clearly appears to be a fair compensation for the desired service,
being three times the price necessary to secure transportation by other
vessels upon any route, and much beyond the charges made to private persons
for services not less burdensome.

Some of the steamship companies, upon the refusal of the Postmaster-General
to attempt, by the means provided, the distribution of the sum appropriated
as an extra compensation, withdrew the services of their vessels and
thereby occasioned slight inconvenience, though no considerable injury, the
mails having been dispatched by other means.

Whatever may be thought of the policy of subsidizing any line of public
conveyance or travel, I am satisfied that it should not be done under cover
of an expenditure incident to the administration of a Department, nor
should there be any uncertainty as to the recipients of the subsidy or any
discretion left to an executive officer as to its distribution. If such
gifts of the public money are to be made for the purpose of aiding any
enterprise in the supposed interest of the public, I can not but think that
the amount to be paid and the beneficiary might better be determined by
Congress than in any other way.

The international congress of delegates from the Postal Union countries
convened at Lisbon, in Portugal, in February last, and after a session of
some weeks the delegates signed a convention amendatory of the present
postal-union convention in some particulars designed to advance its
purposes. This additional act has had my approval and will be laid before
you with the departmental report.

I approve the recommendation of the postmaster-General that another
assistant be provided for his Department. I invite your consideration to
the several other recommendations contained in his report.

The report of the Attorney-General contains a history of the conduct of the
Department of Justice during the last year and a number of valuable
suggestions as to needed legislation, and I invite your careful attention
to the same.

The condition of business in the courts of the United States is such that
there seems to be an imperative necessity for remedial legislation on the
subject. Some of these courts are so overburdened with pending causes that
the delays in determining litigation amount often to a denial of justice.
Among the plans suggested for relief is one submitted by the
Attorney-General. Its main features are: The transfer of all the original
jurisdiction of the circuit courts to the district courts and an increase
of judges for the latter where necessary; an addition of judges to the
circuit courts, and constituting them exclusively courts of appeal, and
reasonably limiting appeals thereto; further restrictions of the right to
remove causes from the State to Federal courts; permitting appeals to the
Supreme Court from the courts of the District of Columbia and the
Territories only in the same cases as they are allowed from State courts,
and guarding against an unnecessary number of appeals from the circuit
courts.

I approve the plan thus outlined, and recommend the legislation necessary
for its application to our judicial system.

The present mode of compensating United States marshals and district
attorneys should, in my opinion, be changed. They are allowed to charge
against the Government certain fees for services, their income being
measured by the amount of such fees within a fixed limit as to their annual
aggregate. This is a direct inducement for them to make their fees in
criminal cases as large as possible in an effort to reach the maximum sum
permitted. As an entirely natural consequence, unscrupulous marshals are
found encouraging frivolous prosecutions, arresting people on petty charges
of crime and transporting them to distant places for examination and trial,
for the purpose of earning mileage and other fees; and district attorneys
uselessly attend criminal examinations far from their places of residence
for the express purpose of swelling their accounts against the Government.
The actual expenses incurred in these transactions are also charged against
the Government.

Thus the rights and freedom of our citizens are outraged and public
expenditures increased for the purpose of furnishing public officers
pretexts for increasing the measure of their compensation.

I think marshals and district attorneys should be paid salaries, adjusted
by a rule which will make them commensurate with services fairly rendered.

In connection with this subject I desire to suggest the advisability, if it
be found not obnoxious to constitutional objection, of investing United
States commissioners with the power to try and determine certain violations
of law within the grade of misdemeanors. Such trials might be made to
depend upon the option of the accused. The multiplication of small and
technical offenses, especially under the provisions of our internal-revenue
law, render some change in our present system very desirable in the
interests of humanity as well as economy. The district courts are now
crowded with petty prosecutions, involving a punishment in case of
conviction, of only a slight fine, while the parties accused are harassed
by an enforced attendance upon courts held hundreds of miles from their
homes. If poor and friendless, they are obliged to remain in jail during
months, perhaps, that elapse before a session of the court is held, and are
finally brought to trial surrounded by strangers and with but little real
opportunity for defense. In the meantime frequently the marshal has charged
against the Government his fees for an arrest, the transportation of the
accused and the expense of the same, and for summoning witnesses before a
commissioner, a grand jury, and a court; the witnesses have been paid from
the public funds large fees and traveling expenses, and the commissioner
and district attorney have also made their charges against the Government.

This abuse in the administration of our criminal law should be remedied;
and if the plan above suggested is not practicable, some other should be
devised.

The report of the Secretary of the Interior, containing an account of the
operations of this important Department and much interesting information,
will be submitted for your consideration.

The most intricate and difficult subject in charge of this Department is
the treatment and management of the Indians. I am satisfied that some
progress may be noted in their condition as a result of a prudent
administration of the present laws and regulations for their control.

But it is submitted that there is lack of a fixed purpose or policy on this
subject, which should be supplied. It is useless to dilate upon the wrongs
of the Indians, and as useless to indulge in the heartless belief that
because their wrongs are revenged in their own atrocious manner, therefore
they should be exterminated.

They are within the care of our Government, and their rights are, or should
be, protected from invasion by the most solemn obligations. They are
properly enough called the wards of the Government; and it should be borne
in mind that this guardianship involves on our part efforts for the
improvement of their condition and the enforcement of their rights. There
seems to be general concurrence in the proposition that the ultimate object
of their treatment should be their civilization and citizenship. Fitted by
these to keep pace in the march of progress with the advanced civilization
about them, they will readily assimilate with the mass of our population,
assuming the responsibilities and receiving the protection incident to this
condition.

The difficulty appears to be in the selection of the means to be at present
employed toward the attainment of this result.

Our Indian population, exclusive of those in Alaska, is reported as
numbering 260,000, nearly all being located on lands set apart for their
use and occupation, aggregating over 134,000,000 acres. These lands are
included in the boundaries of 171 reservations of different dimensions,
scattered in 21 States and Territories, presenting great variations in
climate and in the kind and quality of their soils. Among the Indians upon
these several reservations there exist the most marked differences in
natural traits and disposition and in their progress toward civilization.
While some are lazy, vicious, and stupid, others are industrious, peaceful,
and intelligent; while a portion of them are self-supporting and
independent, and have so far advanced in civilization that they make their
own laws, administered through officers of their own choice, and educate
their children in schools of their own establishment and maintenance,
others still retain, in squalor and dependence, almost the savagery of
their natural state.

In dealing with this question the desires manifested by the Indians should
not be ignored. Here again we find a great diversity. With some the tribal
relation is cherished with the utmost tenacity, while its hold upon others
is considerably relaxed; the love of home is strong with all, and yet there
are those whose attachment to a particular locality is by no means
unyielding; the ownership of their lands in severalty is much desired by
some, while by others, and sometimes among the most civilized, such a
distribution would be bitterly opposed.

The variation of their wants, growing out of and connected with the
character of their several locations, should be regarded. Some are upon
reservations most fit for grazing, but without flocks or herds; and some on
arable land, have no agricultural implements. While some of the
reservations are double the size necessary to maintain the number of
Indians now upon them, in a few cases, perhaps, they should be enlarged.

Add to all this the difference in the administration of the agencies. While
the same duties are devolved upon all, the disposition of the agents and
the manner of their contact with the Indians have much to do with their
condition and welfare. The agent who perfunctorily performs his duty and
slothfully neglects all opportunity to advance their moral and physical
improvement and fails to inspire them with a desire for better things will
accomplish nothing in the direction of their civilization, while he who
feels the burden of an important trust and has an interest in his work
will, by consistent example, firm yet considerate treatment, and
well-directed aid and encouragement, constantly lead those under his charge
toward the light of their enfranchisement.

The history of all the progress which has been made in the civilization of
the Indian I think will disclose the fact that the beginning has been
religious teaching, followed by or accompanying secular education. While
the self-sacrificing and pious men and women who have aided in this good
work by their independent endeavor have for their reward the beneficent
results of their labor and the consciousness of Christian duty well
performed, their valuable services should be fully acknowledged by all who
under the law are charged with the control and management of our Indian
wards.

What has been said indicates that in the present condition of the Indians
no attempt should be made to apply a fixed and unyielding plan of action to
their varied and varying needs and circumstances.

The Indian Bureau, burdened as it is with their general oversight and with
the details of the establishment, can hardly possess itself of the minute
phases of the particular cases needing treatment; and thus the propriety of
creating an instrumentality auxiliary to those already established for the
care of the Indians suggests itself.

I recommend the passage of a law authorizing the appointment of six
commissioners, three of whom shall be detailed from the Army, to be charged
with the duty of a careful inspection from time to time of all the Indians
upon our reservations or subject to the care and control of the Government,
with a view of discovering their exact condition and needs and determining
what steps shall be taken on behalf of the Government to improve their
situation in the direction of their self-support and complete civilization;
that they ascertain from such inspection what, if any, of the reservations
may be reduced in area, and in such cases what part not needed for Indian
occupation may be purchased by the Government from the Indians and disposed
of for their benefit; what, if any, Indians may, with their consent, be
removed to other reservations, with a view of their concentration and the
sale on their behalf of their abandoned reservations; what Indian lands now
held in common should be allotted in severalty; in what manner and to what
extent the Indians upon the reservations can be placed under the protection
of our laws and subjected to their penalties, and which, if any, Indians
should be invested with the right of citizenship. The powers and functions
of the commissioners in regard to these subjects should be clearly defined,
though they should, in conjunction with the Secretary of the Interior, be
given all the authority to deal definitely with the questions presented
deemed safe and consistent.

They should be also charged with the duty of ascertaining the Indians who
might properly be furnished with implements of agriculture, and of what
kind; in what cases the support of the Government should be withdrawn;
where the present plan of distributing Indian supplies should be changed;
where schools may be established and where discontinued; the conduct,
methods, and fitness of agents in charge of reservations; the extent to
which such reservations are occupied or intruded upon by unauthorized
persons, and generally all matters related to the welfare and improvement
of the Indian.

They should advise with the Secretary of the Interior concerning these
matters of detail in management, and he should be given power to deal with
them fully, if he is not now invested with such power.

This plan contemplates the selection of persons for commissioners who are
interested in the Indian question and who have practical ideas upon the
subject of their treatment.

The expense of the Indian Bureau during the last fiscal year was more than
six and a halt million dollars. I believe much of this expenditure might be
saved under the plan proposed; that its economical effects would be
increased with its continuance; that the safety of our frontier settlers
would be subserved under its operation, and that the nation would be saved
through its results from the imputation of inhumanity, injustice, and
mismanagement.

In order to carry out the policy of allotment of Indian lands in severalty,
when deemed expedient, it will be necessary to have surveys completed of
the reservations, and, I hope that provision will be made for the
prosecution of this work.

In May of the present year a small portion of the Chiricahua Apaches on the
White Mountain Reservation, in Arizona, left the reservation and committed
a number of murders and depredations upon settlers in that neighborhood.
Though prompt and energetic action was taken by the military, the renegades
eluded capture and escaped into Mexico. The formation of the country
through which these Indians passed, their thorough acquaintance with the
same, the speed of their escape, and the manner in which they scattered and
concealed themselves among the mountains near the scene of their outrages
put our soldiers at a great disadvantage in their efforts to capture them,
though the expectation is still entertained that they will be ultimately
taken and punished for their crimes.

The threatening and disorderly conduct of the Cheyennes in the Indian
Territory early last summer caused considerable alarm and uneasiness.
Investigation proved that their threatening attitude was due in a great
measure to the occupation of the land of their reservation by immense herds
of cattle, which their owners claimed were rightfully there under certain
leases made by the Indians. Such occupation appearing upon examination to
be unlawful notwithstanding these leases, the intruders were ordered to
remove with their cattle from the lands of the Indians by Executive
proclamation. The enforcement of this proclamation had the effect of
restoring peace and order among the Indians, and they are now quiet and
well behaved.

By an Executive order issued on February 27, 1885, by my predecessor, a
portion of the tract of country in the territory known as the Old Winnebago
and Crow Creek reservations was directed to be restored to the public
domain and opened to settlement under the land laws of the United States,
and a large number of persons entered upon those lands. This action alarmed
the Sioux Indians, who claimed the territory as belonging to their
reservation under the treaty of 1868. This claim was determined, after
careful investigation, to be well rounded, and consequently the Executive
order referred to was by proclamation of April 17, 1885, declared to be
inoperative and of no effect, and all persons upon the land were warned to
leave. This warning has been substantially complied with.

The public domain had its origin in cessions of land by the States to the
General Government. The first cession was made by the State of New York,
and the largest, which in area exceeded all the others, by the State of
Virginia. The territory the proprietorship of which became thus vested in
the General Government extended from the western line of Pennsylvania to
the Mississippi River. These patriotic donations of the States were
encumbered with no condition except that they should the held and used "for
the common benefit of the United States." By purchase with the common fund
of all the people additions were made to this domain until it extended to
the northern line of Mexico, the Pacific Ocean, and the Polar Sea. The
original trust, "for the common benefit of the United States," attached to
all. In the execution of that trust the policy of many homes, rather than
large estates, was adopted by the Government. That these might be easily
obtained, and be the abode of security and contentment, the laws for their
acquisition were few, easily understood, and general in their character.
But the pressure of local interests, combined with a speculative spirit,
have in many instances procured the passage of laws which marred the
harmony of the general plan and encumbered the system with a multitude of
general and special enactments which render the land laws complicated,
subject the titles to uncertainty, and the purchasers often to oppression
and wrong. Laws which were intended for the "common benefit" have been
perverted so that large quantities of land are vesting in single
ownerships. From the multitude and character of the laws, this consequence
seems incapable of correction by mere administration.

It is not for the "common benefit of the United States" that a large area
of the public lands should be acquired, directly or through fraud, in the
hands of a single individual. The nation's strength is in the people. The
nation's prosperity is in their prosperity. The nation's glory is in the
equality of her justice. The nation's perpetuity is in the patriotism of
all her people. Hence, as far as practicable, the plan adopted in the
disposal of the public lands should have in view the original policy, which
encouraged many purchases of these lands for homes and discouraged the
massing of large areas. Exclusive of Alaska, about three-fifths of the
national domain has been sold or subjected to contract or grant. Of the
remaining two-fifths a considerable portion is either mountain or desert. A
rapidly increasing population creates a growing demand for homes, and the
accumulation of wealth inspires an eager competition to obtain the public
land for speculative purposes. In the future this collision of interests
will be more marked than in the past, and the execution of the nation's
trust in behalf of our settlers will be more difficult. I therefore commend
to your attention the recommendations contained in the report of the
Secretary of the Interior with reference to the repeal and modification of
certain of our land laws.

The nation has made princely grants and subsidies to a system of railroads
projected as great national highways to connect the Pacific States with the
East. It has been charged that these donations from the people have been
diverted to private gain and corrupt uses, and thus public indignation has
been aroused and suspicion engendered. Our great nation does not begrudge
its generosity, but it abhors speculation and fraud; and the favorable
regard of our people for the great corporations to which these grants were
made can only be revived by a restoration of confidence, to be secured by
their constant, unequivocal, and clearly manifested integrity. A faithful
application of the undiminished proceeds of the grants to the construction
and perfecting of their roads, an honest discharge of their obligations,
and entire justice to all the people in the enjoyment of their rights on
these highways of travel are all the public asks, and it will be content
with no less. To secure these things should be the common purpose of the
officers of the Government, as well as of the corporations. With this
accomplishment prosperity would be permanently secured to the roads, and
national pride would take the place of national complaint.

It appears from the report of the Commissioner of Pensions that there were
on the 1st day of July, 1885, 345,125 persons borne upon the pension rolls,
who were classified as follows: Army invalids, 241,456; widows, minor
children, and dependent relatives of deceased soldiers, 78,841; navy
invalids, 2,745; navy widows, minor children, and dependents, 1,926;
survivors of the War of 1812, 2,945; and widows of those who served in that
war, 17,212. About one man in ten of all those who enlisted in the late war
are reported as receiving pensions, exclusive of the dependents of deceased
soldiers. On the 1st of July, 1875, the number of pensioners was 234,821,
and the increase within the ten years next thereafter was 110,304.

While there is no expenditure of the public funds which the people more
cheerfully approve than that made in recognition of the services of our
soldiers living and dead, the sentiment underlying the subject should not
be vitiated by the introduction of any fraudulent practices. Therefore it
is fully as important that the rolls should be cleansed of all those who by
fraud have secured a place thereon as that meritorious claims should be
speedily examined and adjusted. The reforms in the methods of doing the
business of this Bureau which have lately been inaugurated promise better
results in both these directions.

The operations of the Patent Office demonstrate the activity of the
inventive genius of the country. For the year ended June 30, 1885, the
applications for patents, including reissues, and for the registration of
trade-marks and labels, numbered 35,688. During the same period there were
22,928 patents granted and reissued and 1,429 trade-marks and labels
registered. The number of patents issued in the year 1875 was 14,387. The
receipts during the last fiscal year were $ 1,074,974.35, and the total
expenditures, not including contingent expenses, $934,123.11.

There were 9,788 applications for patents pending on the 1st day of July,
1884, and 5,786 on the same date in the year 1885. There has been
considerable improvement made in the prompt determination of applications
and a consequent relief to expectant inventors.

A number of suggestions and recommendations are contained in the report of
the Commissioner of patents which are well entitled to the consideration of
Congress.

In the Territory of Utah the law of the United States passed for the
Suppression of polygamy has been energetically and faithfully executed
during the past year, with measurably good results. A number of convictions
have been secured for unlawful cohabitation, and in some cases pleas of
guilty have been entered and a slight punishment imposed, upon a promise by
the accused that they would not again offend against the law, nor advise,
counsel, aid, or abet in any way its violation by others.

The Utah commissioners express the opinion, based upon such information as
they are able to obtain, that but few polygamous marriages have taken place
in the Territory during the last year. They further report that while there
can not be found upon the registration lists of voters the name of a man
actually guilty of polygamy, and while none of that class are holding
office, yet at the last election in the Territory all the officers elected,
except in one county, were men who, though not actually living in the
practice of polygamy, subscribe to the doctrine of polygamous marriages as
a divine revelation and a law unto all higher and more binding upon the
conscience than any human law, local or national. Thus is the strange
spectacle presented of a community protected by a republican form of
government, to which they owe allegiance, sustaining by their suffrages a
principle and a belief which set at naught that obligation of absolute
obedience to the law of the land which lies at the foundation of republican
institutions.

The strength, the perpetuity, and the destiny of the nation rest upon our
homes, established by the law of God, guarded by parental care, regulated
by parental authority, and sanctified by parental love.

These are not the homes of polygamy.

The mothers of our land, who rule the nation as they mold the characters
and guide the actions of their sons, live according to God's holy
ordinances, and each, secure and happy in the exclusive love of the father
of her children, sheds the warm light of true womanhood, unperverted and
unpolluted, upon all within her pure and wholesome family circle.

These are not the cheerless, crushed, and unwomanly mothers of polygamy.

The fathers of our families are the best citizens of the Republic. Wife and
children are the sources of patriotism, and conjugal and parental affection
beget devotion to the country. The man who, undefiled with plural marriage,
is surrounded in his single home with his wife and children has a stake in
the country which inspires him with respect for its laws and courage for
its defense.

These are not the fathers of polygamous families.

There is no feature of this practice or the system which sanctions it which
is not opposed to all that is of value in our institutions.

There should be no relaxation in the firm but just execution of the law now
in operation, and I should be glad to approve such further discreet
legislation as will rid the country of this blot upon its fair fame.

Since the people upholding polygamy in our Territories are reenforced by
immigration from other lands, I recommend that a law be passed to prevent
the importation of Mormons into the country.

The agricultural interest of the country demands just recognition and
liberal encouragement. It sustains with certainty and unfailing strength
our nation's prosperity by the products of its steady toil, and bears its
full share of the burden of taxation without complaint. Our agriculturists
have but slight personal representation in the councils of the nation, and
are generally content with the humbler duties of citizenship and willing to
trust to the bounty of nature for a reward of their labor. But the
magnitude and value of this industry are appreciated when the statement is
made that of our total annual exports more than three-fourths are the
products of agriculture, and of our total population nearly one-half are
exclusively engaged in that occupation.

The Department of Agriculture was created for the purpose of acquiring and
diffusing among the people useful information respecting the subjects it
has in charge, and aiding in the cause of intelligent and progressive
farming, by the collection of statistics, by testing the value and
usefulness of new seeds and plants, and distributing such as are found
desirable among agriculturists. This and other powers and duties with which
this Department is invested are of the utmost importance, and if wisely
exercised must be of great benefit to the country. The aim of our
beneficent Government is the improvement of the people in every station and
the amelioration of their condition. Surely our agriculturists should not
be neglected. The instrumentality established in aid of the farmers of the
land should not only be well equipped for the accomplishment of its
purpose, but those for whose benefit it has been adopted should be
encouraged to avail themselves fully of its advantages.

The prohibition of the importation into several countries of certain of our
animals and their products, based upon the suspicion that health is
endangered in their use and consumption, suggests the importance of such
precautions for the protection of our stock of all kinds against disease as
will disarm suspicion of danger and cause the removal of such an injurious
prohibition.

If the laws now in operation are insufficient to accomplish this
protection, I recommend their amendment to meet the necessities of the
situation; and I commend to the consideration of Congress the suggestions
contained in the report of the Commissioner of Agriculture calculated to
increase the value and efficiency of this Department.

The report of the Civil Service Commission, which will be submitted,
contains an account of the manner in which the civil-service law has been
executed during the last year and much valuable information on this
important subject.

I am inclined to think that there is no sentiment more general in the minds
of the people of our country than a conviction of the correctness of the
principle upon which the law enforcing civil-service reform is based. In
its present condition the law regulates only a part of the subordinate
public positions throughout the country. It applies the test of fitness to
applicants for these places by means of a competitive examination, and
gives large discretion to the Commissioners as to the character of the
examination and many other matters connected with its execution. Thus the
rules and regulations adopted by the Commission have much to do with the
practical usefulness of the statute and with the results of its
application.

The people may well trust the Commission to execute the law with perfect
fairness and with as little irritation as is possible. But of course no
relaxation of the principle which underlies it and no weakening of the
safeguards which surround it can be expected. Experience in its
administration will probably suggest amendment of the methods of its
execution, but I venture to hope that we shall never again be remitted to
the system which distributes public positions purely as rewards for
partisan service. Doubts may well be entertained whether our Government
could survive the strain of a continuance of this system, which upon every
change of Administration inspires an immense army of claimants for office
to lay siege to the patronage of Government, engrossing the time of public
officers with their importunities, spreading abroad the contagion of their
disappointment, and filling the air with the tumult of their discontent.

The allurements of an immense number of offices and places exhibited to the
voters of the land, and the promise of their bestowal in recognition of
partisan activity; debauch the suffrage and rob political action of its
thoughtful and deliberative character. The evil would increase with the
multiplication of offices consequent upon our extension, and the mania for
office holding, growing from its indulgence, would pervade our population
so generally that patriotic purpose, the support of principle, the desire
for the public good, and solicitude for the nation's welfare would be
nearly banished from the activity of our party contests and cause them to
degenerate into ignoble, selfish, and disgraceful struggles for the
possession of office and public place.

Civil-service reform enforced by law came none too soon to check the
progress of demoralization.

One of its effects, not enough regarded, is the freedom it brings to the
political action of those conservative and sober men who, in fear of the
confusion and risk attending an arbitrary and sudden change in all the
public offices with a change of party rule, cast their ballots against such
a chance.

Parties seem to be necessary, and will long continue to exist; nor can it
be now denied that there are legitimate advantages, not disconnected with
office holding, which follow party supremacy. While partisanship continues
bitter and pronounced and supplies so much of motive to sentiment and
action, it is not fair to hold public officials in charge of important
trusts responsible for the best results in the performance of their duties,
and yet insist that they shall rely in confidential and important places
upon the work of those not only opposed to them in political affiliation,
but so steeped in partisan prejudice and rancor that they have no loyalty
to their chiefs and no desire for their success. Civil-service reform does
not exact this, nor does it require that those in subordinate positions who
fail in yielding their best service or who are incompetent should be
retained simply because they are in place. The whining of a clerk
discharged for indolence or incompetency, who, though he gained his place
by the worst possible operation of the spoils system, suddenly discovers
that he is entitled to protection under the sanction of civil-service
reform, represents an idea no less absurd than the clamor of the applicant
who claims the vacant position as his compensation for the most
questionable party work.

The civil-service law does not prevent the discharge of the indolent or
incompetent clerk, but it does prevent supplying his place with the unfit
party worker. Thus in both these phases is seen benefit to the public
service. And the people who desire good government, having secured this
statute, will not relinquish its benefits without protest. Nor are they
unmindful of the fact that its full advantages can only be gained through
the complete good faith of those having its execution in charge. And this
they will insist upon.

I recommend that the salaries of the Civil Service Commissioners be
increased to a sum more nearly commensurate to their important duties.

It is a source of considerable and not unnatural discontent that no
adequate provision has yet been made for accommodating the principal
library of the Government. Of the vast collection of books and pamphlets
gathered at the Capitol, numbering some 700,000, exclusive of manuscripts,
maps, and the products of the graphic arts, also of great volume and value,
only about 300,000 volumes, or less than half the collection, are provided
with shelf room. The others, which are increasing at the rate of from
twenty-five to thirty thousand volumes a year, are not only inaccessible to
the public, but are subject to serious damage and deterioration from other
causes in their present situation.

A consideration of the facts that the library of the Capitol has twice been
destroyed or damaged by fire, its daily increasing value, and its
importance as a place of deposit of books under the law relating to
copyright makes manifest the necessity of prompt action to insure its
proper accommodation and protection.

My attention has been called to a controversy which has arisen from the
condition of the law relating to railroad facilities in the city of
Washington, which has involved the Commissioners of the District in much
annoyance and trouble. I hope this difficulty will be promptly settled by
appropriate legislation.

The Commissioners represent that enough of the revenues of the District are
now on deposit in the Treasury of the United States to repay the sum
advanced by the Government for sewer improvements under the act of June 30,
1884. They desire now an advance of the share which ultimately should be
borne by the District of the cost of extensive improvements to the streets
of the city. The total expense of these contemplated improvements is
estimated at $1,000,000, and they are of the opinion that a considerable
sum could be saved if they had all the money in hand, so that contracts for
the whole work could be made at the same time. They express confidence that
if the advance asked for should be made the Government would be reimbursed
the same within a reasonable time. I have no doubt that these improvements
could be made much cheaper if undertaken together and prosecuted according
to a general plan.

The license law now in force within the District is deficient and uncertain
in some of its provisions and ought to be amended. The Commissioners urge,
with good reason, the necessity of providing a building for the use of the
District government which shall better secure the safety and preservation
of its valuable books and records.

The present condition of the law relating to the succession to the
Presidency in the event of the death, disability, or removal of both the
President and Vice-President is such as to require immediate amendment.
This subject has repeatedly been considered by Congress, but no result has
been reached. The recent lamentable death of the Vice-President, and
vacancies at the same time in all other offices the incumbents of which
might immediately exercise the functions of the presidential office, has
caused public anxiety and a just demand that a recurrence of such a
condition of affairs should not be permitted.

In conclusion I commend to the wise care and thoughtful attention of
Congress the needs, the welfare, and the aspirations of an intelligent and
generous nation. To subordinate these to the narrow advantages of
partisanship or the accomplishment of selfish aims is to violate the
people's trust and betray the people's interests; but an individual sense
of responsibility on the part of each of us and a stern determination to
perform our duty well must give us place among those who have added in
their day and generation to the glory and prosperity of our beloved land.

***

State of the Union Address
Grover Cleveland
December 6, 1886

To the Congress of the United States:

In discharge of a constitutional duty, and following a well-established
precedent in the Executive office, I herewith transmit to the Congress at
its reassembling certain information concerning the state of the Union,
together with such recommendations for legislative consideration as appear
necessary and expedient.

Our Government has consistently maintained its relations of friendship
toward all other powers and of neighborly interest toward those whose
possessions are contiguous to our own. Few questions have arisen during the
past year with other governments, and none of those are beyond the reach of
settlement in friendly counsel.

We are as yet without provision for the settlement of claims of citizens of
the United States against Chile for injustice during the late war with Peru
and Bolivia. The mixed commissions organized under claims conventions
concluded by the Chilean Government with certain European States have
developed an amount of friction which we trust can be avoided in the
convention which our representative at Santiago is authorized to
negotiate.

The cruel treatment of inoffensive Chinese has, I regret to say, been
repeated in some of the far Western States and Territories, and acts of
violence against those people, beyond the power of the local constituted
authorities to prevent and difficult to punish, are reported even in
distant Alaska. Much of this violence can be traced to race prejudice and
competition of labor, which can not, however, justify the oppression of
strangers whose safety is guaranteed by our treaty with China equally with
the most favored nations.

In opening our vast domain to alien elements the purpose of our lawgivers
was to invite assimilation, and not to provide an arena for endless
antagonism. The paramount duty of maintaining public order and defending
the interests of our own people may require the adoption of measures of
restriction, but they should not tolerate the oppression of individuals of
a special race. I am not without assurance that the Government of China,
whose friendly disposition toward us I am most happy to recognize, will
meet us halfway in devising a comprehensive remedy by which an effective
limitation of Chinese emigration, joined to protection of those Chinese
subjects who remain in this country, may be secured.

Legislation is needed to execute the provisions of our Chinese convention
of 1880 touching the opium traffic.

While the good will of the Colombian Government toward our country is
manifest, the situation of American interests on the Isthmus of Panama has
at times excited concern and invited friendly action looking to the
performance of the engagements of the two nations concerning the territory
embraced in the interoceanic transit. With the subsidence of the Isthmian
disturbances and the erection of the State of Panama into a federal
district under the direct government of the constitutional administration
at Bogota, a new order of things has been inaugurated, which, although as
yet somewhat experimental and affording scope for arbitrary exercise of
power by the delegates of the national authority, promises much
improvement.

The sympathy between the people of the United States and France, born
during our colonial struggle for independence and continuing today, has
received a fresh impulse in the successful completion and dedication of the
colossal statue of "Liberty Enlightening the World" in New York Harbor--the
gift of Frenchmen to Americans.

A convention between the United States and certain other powers for the
protection of submarine cables was signed at Paris on March 14, 1884, and
has been duly ratified and proclaimed by this Government. By agreement
between the high contracting parties this convention is to go into effect
on the 1st of January next, but the legislation required for its execution
in the United States has not yet been adopted. I earnestly recommend its
enactment.

Cases have continued to occur in Germany giving rise to much correspondence
in relation to the privilege of sojourn of our naturalized citizens of
German origin revisiting the land of their birth, yet I am happy to state
that our relations with that country have lost none of their accustomed
cordiality.

The claims for interest upon the amount of tonnage dues illegally exacted
from certain German steamship lines were favorably reported in both Houses
of Congress at the last session, and I trust will receive final and
favorable action at an early day.

The recommendations contained in my last annual message in relation to a
mode of settlement of the fishery rights in the waters of British North
America, so long a subject of anxious difference between the United States
and Great Britain, was met by an adverse vote of the Senate on April 13
last, and thereupon negotiations were instituted to obtain an agreement
with Her Britannic Majesty's Government for the promulgation of such joint
interpretation and definition of the article of the convention of 1818
relating to the territorial waters and inshore fisheries of the British
Provinces as should secure the Canadian rights from encroachment by the
United States fishermen and at the same time insure the enjoyment by the
latter of the privileges guaranteed to them by such convention.

The questions involved are of long standing, of grave consequence, and from
time to time for nearly three-quarters of a century have given rise to
earnest international discussions, not unaccompanied by irritation.

Temporary arrangements by treaties have served to allay friction, which,
however, has revived as each treaty was terminated. The last arrangement,
under the treaty of 1871, was abrogated after due notice by the United
States on June 30, 1885, but I was enabled to obtain for our fishermen for
the remainder of that season enjoyment of the full privileges accorded by
the terminated treaty.

The joint high commission by whom the treaty had been negotiated, although
invested with plenary power to make a permanent settlement, were content
with a temporary arrangement, after the termination of which the question
was relegated to the stipulations of the treaty of 1818, as to the first
article of which no construction satisfactory to both countries has ever
been agreed upon.

The progress of civilization and growth of population in the British
Provinces to which the fisheries in question are contiguous and the
expansion of commercial intercourse between them and the United States
present to-day a condition of affairs scarcely realizable at the date of
the negotiations of 1818.

New and vast interests have been brought into existence; modes of
intercourse between the respective countries have been invented and
multiplied; the methods of conducting the fisheries have been wholly
changed; and all this is necessarily entitled to candid and careful
consideration in the adjustment of the terms and conditions of intercourse
and commerce between the United States and their neighbors along a frontier
of over 3,500 miles.

This propinquity, community of language and occupation, and similarity of
political and social institutions indicate the practicability and obvious
wisdom of maintaining mutually beneficial and friendly relations.

Whilst I am unfeignedly desirous that such relations should exist between
us and the inhabitants of Canada, yet the action of their officials during
the past season toward our fishermen has been such as to seriously threaten
their continuance.

Although disappointed in my efforts to secure a satisfactory settlement of
the fishery question, negotiations are still pending, with reasonable hope
that before the close of the present session of Congress announcement may
be made that an acceptable conclusion has been reached.

As at an early day there may be laid before Congress the correspondence of
the Department of State in relation to this important subject, so that the
history of the past fishing season may be fully disclosed and the action
and the attitude of the Administration clearly comprehended, a more
extended reference is not deemed necessary in this communication.

The recommendation submitted last year that provision be made for a
preliminary reconnoissance of the conventional boundary line between Alaska
and British Columbia is renewed.

I express my unhesitating conviction that the intimacy of our relations
with Hawaii should be emphasized. As a result of the reciprocity treaty of
1875, those islands, on the highway of Oriental and Australasian traffic,
are virtually an outpost of American commerce and a stepping-stone to the
growing trade of the Pacific. The Polynesian Island groups have been so
absorbed by other and more powerful governments that the Hawaiian Islands
are left almost alone in the enjoyment of their autonomy, which it is
important for us should be preserved. Our treaty is now terminable on one
year's notice, but propositions to abrogate it would be, in my judgment,
most ill advised. The paramount influence we have there acquired, once
relinquished, could only with difficulty be regained, and a valuable ground
of vantage for ourselves might be converted into a stronghold for our
commercial competitors. I earnestly recommend that the existing treaty
stipulations be extended for a further term of seven years. A recently
signed treaty to this end is now before the Senate.

The importance of telegraphic communication between those islands and the
United States should not be overlooked.

The question of a general revision of the treaties of Japan is again under
discussion at Tokyo. As the first to open relations with that Empire, and
as the nation in most direct commercial relations with Japan, the United
States have lost no opportunity to testify their consistent friendship by
supporting the just claims of Japan to autonomy and independence among
nations.

A treaty of extradition between the United States and Japan, the first
concluded by that Empire, has been lately proclaimed.

The weakness of Liberia and the difficulty of maintaining effective
sovereignty over its outlying districts have exposed that Republic to
encroachment. It can not be forgotten that this distant community is an
offshoot of our own system, owing its origin to the associated benevolence
of American citizens, whose praiseworthy efforts to create a nucleus of
civilization in the Dark Continent have commanded respect and sympathy
everywhere, especially in this country. Although a formal protectorate over
Liberia is contrary to our traditional policy, the moral right and duty of
the United States to assist in all proper ways in the maintenance of its
integrity is obvious, and has been consistently announced during nearly
half a century. I recommend that in the reorganization of our Navy a small
vessel, no longer found adequate to our needs, be presented to Liberia, to
be employed by it in the protection of its coastwise revenues.

The encouraging development of beneficial and intimate relations between
the United States and Mexico, which has been so marked within the past few
years, is at once the occasion of congratulation and of friendly
solicitude. I urgently renew my former representation of the need or speedy
legislation by Congress to carry into effect the reciprocity commercial
convention of January 20, 1883.

Our commercial treaty of 1831 with Mexico was terminated, according to its
provisions, in 1881, upon notification given by Mexico in pursuance of her
announced policy of recasting all her commercial treaties. Mexico has since
concluded with several foreign governments new treaties of commerce and
navigation, defining alien rights of trade, property, and residence,
treatment of shipping, consular privileges, and the like. Our yet
unexecuted reciprocity convention of 1883 covers none of these points, the
settlement of which is so necessary to good relationship. I propose to
initiate with Mexico negotiations for a new and enlarged treaty of commerce
and navigation.

In compliance with a resolution of the Senate, I communicated to that body
on August 2 last, and also to the House of Representatives, the
correspondence in the case of A. K. Cutting, an American citizen, then
imprisoned in Mexico, charged with the commission of a penal offense in
Texas, of which a Mexican citizen was the object.

After demand had been made for his release the charge against him was
amended so as to include a violation of Mexican law within Mexican
territory.

This joinder of alleged offenses, one within and the other exterior to
Mexico, induced me to order a special investigation of the case, pending
which Mr. Cutting was released.

The incident has, however, disclosed a claim of jurisdiction by Mexico
novel in our history, whereby any offense committed anywhere by a
foreigner, penal in the place of its commission, and of which a Mexican is
the object, may, if the offender be found in Mexico, be there tried and
punished in conformity with Mexican laws.

This jurisdiction was sustained by the courts of Mexico in the Cutting
case, and approved by the executive branch of that Government, upon the
authority of a Mexican statute. The appellate court in releasing Mr.
Cutting decided that the abandonment of the complaint by the Mexican
citizen aggrieved by the alleged crime (a libelous publication) removed the
basis of further prosecution, and also declared justice to have been
satisfied by the enforcement of a small part of the original sentence.

The admission of such a pretension would be attended with serious results,
invasive of the jurisdiction of this Government and highly dangerous to our
citizens in foreign lands. Therefore I have denied it and protested against
its attempted exercise as unwarranted by the principles of law and
international usages.

A sovereign has jurisdiction of offenses which take effect within his
territory, although concocted or commenced outside of it; but the right is
denied of any foreign sovereign to punish a citizen of the United States
for an offense consummated on our soil in violation of our laws, even
though the offense be against a subject or citizen of such sovereign. The
Mexican statute in question makes the claim broadly, and the principle, if
conceded, would create a dual responsibility in the citizen and lead to
inextricable confusion, destructive of that certainty in the law which is
an essential of liberty.

When citizens of the United States voluntarily go into a foreign country,
they must abide by the laws there in force, and will not be protected by
their own Government from the consequences of an offense against those laws
committed in such foreign country; but watchful care and interest of this
Government over its citizens are not relinquished because they have gone
abroad, and if charged with crime committed in the foreign land a fair and
open trial, conducted with decent regard for justice and humanity, will be
demanded for them. With less than that this Government will not be content
when the life or liberty of its citizens is at stake.

Whatever the degree to which extraterritorial criminal jurisdiction may
have been formerly allowed by consent and reciprocal agreement among
certain of the European States, no such doctrine or practice was ever known
to the laws of this country or of that from which our institutions have
mainly been derived.

In the case of Mexico there are reasons especially strong for perfect
harmony in the mutual exercise of jurisdiction. Nature has made us
irrevocably neighbors, and wisdom and kind feeling should make us friends.

The overflow of capital and enterprise from the United States is a potent
factor in assisting the development of the resources of Mexico and in
building up the prosperity of both countries.

To assist this good work all grounds of apprehension for the security of
person and property should be removed; and I trust that in the interests of
good neighborhood the statute referred to will be so modified as to
eliminate the present possibilities of danger to the peace of the two
countries.

The Government of the Netherlands has exhibited concern in relation to
certain features of our tariff laws, which are supposed by them to be aimed
at a class of tobacco produced in the Dutch East Indies. Comment would seem
unnecessary upon the unwisdom of legislation appearing to have a special
national discrimination for its object, which, although unintentional, may
give rise to injurious retaliation.

The establishment, less than four years ago, of a legation at Teheran is
bearing fruit in the interest exhibited by the Shah's Government in the
industrial activity of the United States and the opportunities of
beneficial interchanges.

Stable government is now happily restored in Peru by the election of a
constitutional president, and a period of rehabilitation is entered upon;
but the recovery is necessarily slow from the exhaustion caused by the late
war and civil disturbances. A convention to adjust by arbitration claims of
our citizens has been proposed and is under consideration.

The naval officer who bore to Siberia the testimonials bestowed by Congress
in recognition of the aid given to the Jeannette survivors has successfully
accomplished his mission. His interesting report will be submitted. It is
pleasant to know that this mark of appreciation has been welcomed by the
Russian Government and people as befits the traditional friendship of the
two countries.

Civil perturbations in the Samoan Islands have during the past few years
been a source of considerable embarrassment to the three
Governments-Germany, Great Britain, and the United States--whose relations
and extraterritorial rights in that important group are guaranteed by
treaties. The weakness of the native administration and the conflict of
opposing interests in the islands have led King Malietoa to seek alliance
or protection in some one quarter, regardless of the distinct engagements
whereby no one of the three treaty powers may acquire any paramount or
exclusive interest. In May last Malietoa offered to place Samoa under the
protection of the United States, and the late consul, without authority,
assumed to grant it. The proceeding was promptly disavowed and the
overzealous official recalled. Special agents of the three Governments have
been deputed to examine the situation in the islands. With a change in the
representation of all three powers and a harmonious understanding between
them, the peace, prosperity, autonomous administration, and neutrality of
Samoa can hardly fail to be secured.

It appearing that the Government of Spain did not extend to the flag of the
United States in the Antilles the full measure of reciprocity requisite
under our statute for the continuance of the suspension of discriminations
against the Spanish flag in our ports, I was constrained in October last to
rescind my predecessor's proclamation of February 14, 1884, permitting such
suspension. An arrangement was, however, speedily reached, and upon
notification from the Government of Spain that all differential treatment
of our vessels and their cargoes, from the United States or from any
foreign country, had been completely and absolutely relinquished, I availed
myself of the discretion conferred by law and issued on the 27th of October
my proclamation declaring reciprocal suspension in the United States. It is
most gratifying to bear testimony to the earnest spirit in which the
Government of the Queen Regent has met our efforts to avert the initiation
of commercial discriminations and reprisals, which are ever disastrous to
the material interests and the political good will of the countries they
may affect.

The profitable development of the large commercial exchanges between the
United States and the Spanish Antilles is naturally an object of
solicitude. Lying close at our doors, and finding here their main markets
of supply and demand, the welfare of Cuba and Puerto Rico and their
production and trade are scarcely less important to us than to Spain. Their
commercial and financial movements are so naturally a part of our system
that no obstacle to fuller and freer intercourse should be permitted to
exist. The standing instructions of our representatives at Madrid and
Havana have for years been to leave no effort unessayed to further these
ends, and at no time has the equal good desire of Spain been more hopefully
manifested than now.

The Government of Spain, by removing the consular tonnage fees on cargoes
shipped to the Antilles and by reducing passport fees, has shown its
recognition of the needs of less trammeled intercourse.

An effort has been made during the past year to remove the hindrances to
the proclamation of the treaty of naturalization with the Sublime Porte,
signed in 1874, which has remained inoperative owing to a disagreement of
interpretation of the clauses relative to the effects of the return to and
sojourn of a naturalized citizen in the land of origin. I trust soon to be
able to announce a favorable settlement of the differences as to this
interpretation.

It has been highly satisfactory to note the improved treatment of American
missionaries in Turkey, as has been attested by their acknowledgments to
our late minister to that Government of his successful exertions in their
behalf.

The exchange of ratifications of the convention of December 5, 1885, with
Venezuela, for the reopening of the awards of the Caracas Commission under
the claims convention of 1866, has not yet been effected, owing to the
delay of the Executive of that Republic in ratifying the measure. I trust
that this postponement will be brief; but should it much longer continue,
the delay may well be regarded as a rescission of the compact and a failure
on the part of Venezuela to complete an arrangement so persistently sought
by her during many years and assented to by this Government in a spirit of
international fairness, although to the detriment of holders of bona fide
awards of the impugned commission.

I renew the recommendation of my last annual message that existing
legislation concerning citizenship and naturalization be revised. We have
treaties with many states providing for the renunciation of citizenship by
naturalized aliens, but no statute is found to give effect to such
engagements, nor any which provides a needed central bureau for the
registration of naturalized citizens.

Experience suggests that our statutes regulating extradition might be
advantageously amended by a provision for the transit across our territory,
now a convenient thoroughfare of travel from one foreign country to
another, of fugitives surrendered by a foreign government to a third state.
Such provisions are not unusual in the legislation of other countries, and
tend to prevent the miscarriage of justice. It is also desirable, in order
to remove present uncertainties, that authority should be conferred on the
Secretary of State to issue a certificate, in case of an arrest for the
purpose of extradition, to the officer before whom the proceeding is
pending, showing that a requisition for the surrender of the person charged
has been duly made. Such a certificate, if required to be received before
the prisoner's examination, would prevent a long and expensive judicial
inquiry into a charge which the foreign government might not desire to
press. I also recommend that express provision be made for the immediate
discharge from custody of persons committed for extradition where the
President is of opinion that surrender should not be made.

The drift of sentiment in civilized communities toward full recognition of
the rights of property in the creations of the human intellect has brought
about the adoption by many important nations of an international copyright
convention, which was signed at Berne on the 18th of September, 1885.

Inasmuch as the Constitution gives to the Congress the power "to promote
the progress of science and useful arts by securing for limited times to
authors and inventors the exclusive right to their respective writings and
discoveries," this Government did not feel warranted in becoming a
signatory pending the action of Congress upon measures of international
copyright now before it; but the right of adhesion to the Berne convention
hereafter has been reserved. I trust the subject will receive at your hands
the attention it deserves, and that the just claims of authors, so urgently
pressed, will be duly heeded.

Representations continue to be made to me of the injurious effect upon
American artists studying abroad and having free access to the art
collections of foreign countries of maintaining a discriminating duty
against the introduction of the works of their brother artists of other
countries, and I am induced to repeat my recommendation for the abolition
of that tax.

Pursuant to a provision of the diplomatic and consular appropriation act
approved July 1, 1886, the estimates submitted by the Secretary of State
for the maintenance of the consular service have been recast on the basis
of salaries for all officers to whom such allowance is deemed advisable.
Advantage has been taken of this to redistribute the salaries of the
offices now appropriated for, in accordance with the work performed, the
importance of the representative duties of the incumbent, and the cost of
living at each post. The last consideration has been too often lost sight
of in the allowances heretofore made. The compensation which may suffice
for the decent maintenance of a worthy and capable officer in a position of
onerous and representative trust at a post readily accessible, and where
the necessaries of life are abundant and cheap, may prove an inadequate
pittance in distant lands, where the better part of a year's pay is
consumed in reaching the post of duty, and where the comforts of ordinary
civilized existence can only be obtained with difficulty and at exorbitant
cost. I trust that in considering the submitted schedules no mistaken
theory of economy will perpetuate a system which in the past has virtually
closed to deserving talent many offices where capacity and attainments of a
high order are indispensable, and in not a few instances has brought
discredit on our national character and entailed embarrassment and even
suffering on those deputed to uphold our dignity and interests abroad.

In connection with this subject I earnestly reiterate the practical
necessity of supplying some mode of trustworthy inspection and report of
the manner in which the consulates are conducted. In the absence of such
reliable information efficiency can scarcely be rewarded or its opposite
corrected.

Increasing competition in trade has directed attention to the value of the
consular reports printed by the Department of State, and the efforts of the
Government to extend the practical usefulness of these reports have created
a wider demand for them at home and a spirit of emulation abroad.
Constituting a record at the changes occurring in trade and of the progress
of the arts and invention in foreign countries, they are much sought for by
all interested in the subjects which they embrace.

The report of the Secretary of the Treasury exhibits in detail the
condition of the public finances and of the several branches of the
Government related to his Department. I especially direct the attention of
the Congress to the recommendations contained in this and the last
preceding report of the Secretary touching the simplification and amendment
of the laws relating to the collection of our revenues, and in the interest
of economy and justice to the Government I hope they may be adopted by
appropriate legislation.

The ordinary receipts of the Government for the fiscal year ended June 30,
1886, were $336,439,727.06. Of this amount $192,905,023.41 was received
from customs and $116,805,936.48 from internal revenue. The total receipts,
as here stated, were $13,749,020.68 greater than for the previous year, but
the increase from customs was $11,434,084.10 and from internal revenue
$4,407,210.94, making a gain in these items for the last year of
$15,841,295.04, a falling off in other resources reducing the total
increase to the smaller amount mentioned.

The expense at the different custom-houses of collecting this increased
customs revenue was less than the expense attending the collection of such
revenue for the preceding year by $490,608, and the increased receipts of
internal revenue were collected at a cost to the Internal-Revenue Bureau
$155,944.99 less than the expense of such collection for the previous
year.

The total ordinary expenses of the Government for the fiscal year ended
June 30, 1886, were $242,483,138.50, being less by $17,788,797 than such
expenditures for the year preceding, and leaving a surplus in the Treasury
at the close of the last fiscal year of $93,956,588.56, as against
$63,463,771.27 at the close of the previous year, being an increase in such
surplus of $30,492,817.29.

The expenditures are compared with those of the preceding fiscal year and
classified as follows:

For the current year to end June 30, 1887, the ascertained receipts up to
October 1, 1886, with such receipts estimated for the remainder of the
year, amount to $356,000,000.

The expenditures ascertained and estimated for the same period are
$266,000,000, indicating an anticipated surplus at the close of the year of
$90,000,000.

The total value of the exports from the United States to foreign countries
during the fiscal year is stated and compared with the preceding year as
follows:

The value of some of our leading exports during the last fiscal year, as
compared with the value of the same for the year immediately preceding, is
here given, and furnishes information both interesting and suggestive:

Our imports during the last fiscal year, as compared with the previous
year, were as follows:

In my last annual message to the Congress attention was directed to the
fact that the revenues of the Government exceeded its actual needs, and it
was suggested that legislative action should be taken to relieve the people
from the unnecessary burden of taxation thus made apparent.

In view of the pressing importance of the subject I deem it my duty to
again urge its consideration.

The income of the Government, by its increased volume and through economies
in its collection, is now more than ever in excess of public necessities.
The application of the surplus to the payment of such portion of the public
debt as is now at our option subject to extinguishment, if continued at the
rate which has lately prevailed, would retire that class of indebtedness
within less than one year from this date. Thus a continuation of our
present revenue system would soon result in the receipt of an annual income
much greater than necessary to meet Government expenses, with no
indebtedness upon which it could be applied. We should then be confronted
with a vast quantity of money, the circulating medium of the people,
hoarded in the Treasury when it should be in their hands, or we should be
drawn into wasteful public extravagance, with all the corrupting national
demoralization which follows in its train.

But it is not the simple existence of this surplus and its threatened
attendant evils which furnish the strongest argument against our present
scale of Federal taxation. Its worst phase is the exaction of such a
surplus through a perversion of the relations between the people and their
Government and a dangerous departure from the rules which limit the right
of Federal taxation.

Good government, and especially the government of which every American
citizen boasts, has for its objects the protection of every person within
its care in the greatest liberty consistent with the good order of society
and his perfect security in the enjoyment of his earnings with the least
possible diminution for public needs. When more of the people's substance
is exacted through the form of taxation than is necessary to meet the just
obligations of the Government and the expense of its economical
administration, such exaction becomes ruthless extortion and a violation of
the fundamental principles of a free government.

The indirect manner in which these exactions are made has a tendency to
conceal their true character and their extent. But we have arrived at a
stage of superfluous revenue which has aroused the people to a realization
of the fact that the amount raised professedly for the support of the
Government is paid by them as absolutely if added to the price of the
things which supply their daily wants as if it was paid at fixed periods
into the hand of the tax gatherer.

Those who toil for daily wages are beginning to understand that capital,
though sometimes vaunting its importance and clamoring for the protection
and favor of the Government, is dull and sluggish till, touched by the
magical hand of labor, it springs into activity, furnishing an occasion for
Federal taxation and gaining the value which enables it to bear its burden.
And the laboring man is thoughtfully inquiring whether in these
circumstances, and considering the tribute he constantly pays into the
public Treasury as he supplies his daily wants, he receives his fair share
of advantages.

There is also a suspicion abroad that the surplus of our revenues indicates
abnormal and exceptional business profits, which, under the system which
produces such surplus, increase without corresponding benefit to the people
at large the vast accumulations of a few among our citizens, whose
fortunes, rivaling the wealth of the most favored in antidemocratic
nations, are not the natural growth of a steady, plain, and industrious
republic.

Our farmers, too, and those engaged directly and indirectly in supplying
the products of agriculture, see that day by day, and as often as the daily
wants of their households recur, they are forced to pay excessive and
needless taxation, while their products struggle in foreign markets with
the competition of nations, which, by allowing a freer exchange of
productions than we permit, enable their people to sell for prices which
distress the American farmer.

As every patriotic citizen rejoices in the constantly increasing pride of
our people in American citizenship and in the glory of our national
achievements and progress, a sentiment prevails that the leading strings
useful to a nation in its infancy may well be to a great extent discarded
in the present stage of American ingenuity, courage, and fearless
self-reliance; and for the privilege of indulging this sentiment with true
American enthusiasm our citizens are quite willing to forego an idle
surplus in the public Treasury.

And all the people know that the average rate of Federal taxation upon
imports is to-day, in time of peace, but little less, while upon some
articles of necessary consumption it is actually more, than was imposed by
the grievous burden willingly borne at a time when the Government needed
millions to maintain by war the safety and integrity of the Union.

It has been the policy of the Government to collect the principal part of
its revenues by a tax upon imports, and no change in this policy is
desirable. But the present condition of affairs constrains our people to
demand that by a revision of our revenue laws the receipts of the
Government shall be reduced to the necessary expense of its economical
administration; and this demand should be recognized and obeyed by the
people's representatives in the legislative branch of the Government.

In readjusting the burdens of Federal taxation a sound public policy
requires that such of our citizens as have built up large and important
industries under present conditions should not be suddenly and to their
injury deprived of advantages to which they have adapted their business;
but if the public good requires it they should be content with such
consideration as shall deal fairly and cautiously with their interests,
while the just demand of the people for relief from needless taxation is
honestly answered.

A reasonable and timely submission to such a demand should certainly be
possible without disastrous shock to any interest; and a cheerful
concession sometimes averts abrupt and heedless action, often the outgrowth
of impatience and delayed justice.

Due regard should be also accorded in any proposed readjustment to the
interests of American labor so far as they are involved. We congratulate
ourselves that there is among us no laboring class fixed within unyielding
bounds and doomed under all conditions to the inexorable fate of daily
toil. We recognize in labor a chief factor in the wealth of the Republic,
and we treat those who have it in their keeping as citizens entitled to the
most careful regard and thoughtful attention. This regard and attention
should be awarded them, not only because labor is the capital of our
workingmen, justly entitled to its share of Government favor, but for the
further and not less important reason that the laboring man, surrounded by
his family in his humble home, as a consumer is vitally interested in all
that cheapens the cost of living and enables him to bring within his
domestic circle additional comforts and advantages.

This relation of the workingman to the revenue laws of the country and the
manner in which it palpably influences the question of wages should not be
forgotten in the justifiable prominence given to the proper maintenance of
the supply and protection of well-paid labor. And these considerations
suggest such an arrangement of Government revenues as shall reduce the
expense of living, while it does not curtail the opportunity for work nor
reduce the compensation of American labor and injuriously affect its
condition and the dignified place it holds in the estimation of our
people.

But our farmers and agriculturists--those who from the soil produce the
things consumed by all--are perhaps more directly and plainly concerned
than any other of our citizens in a just and careful system of Federal
taxation. Those actually engaged in and more remotely connected with this
kind of work number nearly one-half of our population. None labor harder or
more continuously than they. No enactments limit their hours of toil and no
interposition of the Government enhances to any great extent the value of
their products. And yet for many of the necessaries and comforts of life,
which the most scrupulous economy enables them to bring into their homes,
and for their implements of husbandry, they are obliged to pay a price
largely increased by an unnatural profit, which by the action of the
Government is given to the more favored manufacturer.

I recommend that, keeping in view all these considerations, the increasing
and unnecessary surplus of national income annually accumulating be
released to the people by an amendment to our revenue laws which shall
cheapen the price of the necessaries of life and give freer entrance to
such imported materials as by American labor may be manufactured into
marketable commodities.

Nothing can be accomplished, however, in the direction of this much-needed
reform unless the subject is approached in a patriotic spirit of devotion
to the interests of the entire country and with a willingness to yield
something for the public good.

The sum paid upon the public debt during the fiscal year ended June 30,
1886, was $44,551,043.36.

During the twelve months ended October 31,1886, 3 per cent bonds were
called for redemption amounting to $127,283,100, of which $80,643,200 was
so called to answer the requirements of the law relating to the sinking
fund and $46,639,900 for the purpose of reducing the public debt by
application of a part of the surplus in the Treasury to that object. Of the
bonds thus called $102,269,450 became subject under such calls to
redemption prior to November 1, 1886. The remainder, amounting
to $25,013,650, matured under the calls after that date.

In addition to the amount subject to payment and cancellation prior to
November 1, there were also paid before that day certain of these bonds,
with the interest thereon, amounting to $5,072,350, which were anticipated
as to their maturity, of which $2,664,850 had not been called, Thus
$107,341,800 had been actually applied prior to the 1st of November, 1886,
to the extinguishment of our bonded and interest-bearing debt, leaving on
that day still outstanding the sum of $1,153,443,112. Of this amount
$86,848,700 were still represented by 3 per cent bonds. They however, have
been since November 1, or will at once be, further reduced by $22,606,150,
being bonds which have been called, as already stated, but not redeemed and
canceled before the latter date.

During the fiscal year ended June 30, 1886, there were coined, under the
compulsory silver-coinage act of 1878,29,838,905 silver dollars, and the
cost of the silver used in such coinage was $23,448,960.01. There had been
coined up to the close of the previous fiscal year under the provisions of
the law 203,882,554 silver dollars, and on the 1st day of December, 1886,
the total amount of such coinage was $247,131,549.

The Director of the Mint reports that at the time of the passage of the law
of 1878 directing this coinage the intrinsic value of the dollars thus
coined was 94 1/4 cents each, and that on the 31st day of July, 1886, the
price of silver reached the lowest stage ever known, so that the intrinsic
or bullion price of our standard silver dollar at that date was less than
72 cents. The price of silver on the 30th day of November last was such as
to make these dollars intrinsically worth 78 cents each.

These differences in value of the coins represent the fluctuations in the
price of silver, and they certainly do not indicate that compulsory coinage
by the Government enhances the price of that commodity or secures
uniformity in its value.

Every fair and legal effort has been made by the Treasury Department to
distribute this currency among the people. The withdrawal of United States
Treasury notes of small denominations and the issuing of small silver
certificates have been resorted to in the endeavor to accomplish this
result, in obedience to the will and sentiments of the representatives of
the people in the Congress. On the 27th day of November, 1886, the people
held of these coins, or certificates representing them, the nominal sum of
$166,873,041, and we still had $79,464,345 in the Treasury as against about
$142,894,055 so in the hands of the people and $72,865,376 remaining in the
Treasury one year ago. The Director of the Mint again urges the necessity
of more vault room for the purpose of storing these silver dollars which
are not needed for circulation by the people.

I have seen no reason to change the views expressed in my last annual
message on the subject of this compulsory coinage, and I again urge its
suspension on all the grounds contained in my former recommendation,
reenforced by the significant increase of our gold exportations during the
last year, as appears by the comparative statement herewith presented, and
for the further reasons that the more this currency is distributed among
the people the greater becomes our duty to protect it from disaster, that
we now have abundance for all our needs, and that there seems but little
propriety in building vaults to store such currency when the only pretense
for its coinage is the necessity of its use by the people as a circulating
medium.

The great number of suits now pending in the United States courts for the
southern district of New York growing out of the collection of customs
revenue at the port of New York and the number of such suits that are
almost daily instituted are certainly worthy the attention of the Congress.
These legal controversies, based upon conflicting views by importers and
the collector as to the interpretation of our present complex and
indefinite revenue laws, might be largely obviated by an amendment of those
laws.

But pending such amendment the present condition of this litigation should
be relieved. There are now pending about 2,500 of these suits. More than
1,100 have been commenced within the past eighteen months, and many of the
others have been at issue for more than twenty-five years. These delays
subject the Government to loss of evidence and prevent the preparation
necessary to defeat unjust and fictitious claims, while constantly accruing
interest threatens to double the demands involved.

In the present condition of the dockets of the courts, well filled with
private suits, and of the force allowed the district attorney, no greater
than is necessary for the ordinary and current business of his office,
these revenue litigations can not be considered.

In default of the adoption by the Congress of a plan for the general
reorganization of the Federal courts, as has been heretofore recommended, I
urge the propriety of passing a law permitting the appointment of an
additional Federal judge in the district where these Government suits have
accumulated, so that by continuous sessions of the courts devoted to the
trial of these cases they may be determined.

It is entirely plain that a great saving to the Government would be
accomplished by such a remedy, and the suitors who have honest claims would
not be denied justice through delay.

The report of the Secretary of War gives a detailed account of the
administration of his Department and contains sundry recommendations for
the improvement of the service, which I fully approve.

The Army consisted at the date of the last consolidated return of 2,103
officers and 24,946 enlisted men.

The expenses of the Department for the last fiscal year were
$36,990,903.38, including $6,294,305.43 for public works and river and
harbor improvements.

I especially direct the attention of the Congress to the recommendation
that officers be required to submit to an examination as a preliminary to
their promotion. I see no objection, but many advantages, in adopting this
feature, which has operated so beneficially in our Navy Department, as well
as in some branches of the Army.

The subject of coast defenses and fortifications has been fully and
carefully treated by the Board on Fortifications, whose report was
submitted at the last session of Congress; but no construction work of the
kind recommended by the board has been possible during the last year from
the lack of appropriations for such purpose.

The defenseless condition of our seacoast and lake frontier is perfectly
palpable. The examinations made must convince us all that certain of our
cities named in the report of the board should be fortified and that work
on the most important of these fortifications should be commenced at once.
The work has been thoroughly considered and laid out, the Secretary of War
reports, but all is delayed in default of Congressional action.

The absolute necessity, judged by all standards of prudence and foresight,
of our preparation for an effectual resistance against the armored ships
and steel guns and mortars of modern construction which may threaten the
cities on our coasts is so apparent that I hope effective steps will be
taken in that direction immediately.

The valuable and suggestive treatment of this question by the Secretary of
War is earnestly commended to the consideration of the Congress.

In September and October last the hostile Apaches who, under the leadership
of Geronimo, had for eighteen months been on the war path, and during that
time had committed many murders and been the cause of constant terror to
the settlers of Arizona, surrendered to General Miles, the military
commander who succeeded General Crook in the management and direction of
their pursuit.

Under the terms of their surrender as then reported, and in view of the
understanding which these murderous savages seemed to entertain of the
assurances given them, it was considered best to imprison them in such
manner as to prevent their ever engaging in such outrages again, instead of
trying them for murder. Fort Pickens having been selected as a safe place
of confinement, all the adult males were sent thither and will be closely
guarded as prisoners. In the meantime the residue of the band, who, though
still remaining upon the reservation, were regarded as unsafe and suspected
of furnishing aid to those on the war path, had been removed to Fort
Marion. The women and larger children of the hostiles were also taken
there, and arrangements have been made for putting the children of proper
age in Indian schools.

The report of the Secretary of the Navy contains a detailed exhibit of the
condition of his Department, with such a statement of the action needed to
improve the same as should challenge the earnest attention of the
Congress.

The present Navy of the United States, aside from the ships in course of
construction, consists of--

First. Fourteen single-turreted monitors, none of which are in commission
nor at the present time serviceable. The batteries of these ships are
obsolete, and they can only be relied upon as auxiliary ships in harbor
defense, and then after such an expenditure upon them as might not be
deemed justifiable.

Second. Five fourth-rate vessels of small tonnage, only one of which was
designed as a war vessel, and all of which are auxiliary merely.

Third. Twenty-seven cruising ships, three of which are built of iron, of
small tonnage, and twenty-four of wood. Of these wooden vessels it is
estimated by the Chief Constructor of the Navy that only three will be
serviceable beyond a period of six years, at which time it may be said that
of the present naval force nothing worthy the name will remain.

All the vessels heretofore authorized are under contract or in course of
construction except the armored ships, the torpedo and dynamite boats, and
one cruiser. As to the last of these, the bids were in excess of the limit
fixed by Congress. The production in the United States of armor and gun
steel is a question which it seems necessary to settle at an early day if
the armored war vessels are to be completed with those materials of home
manufacture. This has been the subject of investigation by two boards and
by two special committees of Congress within the last three years. The
report of the Gun Foundry Board in 1884, of the Board on Fortifications
made in January last, and the reports of the select committees of the two
Houses made at the last session of Congress have entirely exhausted the
subject, so far as preliminary investigation is involved, and in their
recommendations they are substantially agreed.

In the event that the present invitation of the Department for bids to
furnish such of this material as is now authorized shall fail to induce
domestic manufacturers to undertake the large expenditures required to
prepare for this new manufacture, and no other steps are taken by Congress
at its coming session, the Secretary contemplates with dissatisfaction the
necessity of obtaining abroad the armor and the gun steel for the
authorized ships. It would seem desirable that the wants of the Army and
the Navy in this regard should be reasonably met, and that by uniting their
contracts such inducement might be offered as would result in securing the
domestication of these important interests.

The affairs of the postal service show marked and gratifying improvement
during the past year. A particular account of its transactions and
condition is given in the report of the Postmaster-General, which will be
laid before you.

The reduction of the rate of letter postage in 1883, rendering the postal
revenues inadequate to sustain the expenditures, and business depression
also contributing, resulted in an excess of cost for the fiscal year ended
June 30, 1885, of eight and one-third millions of dollars. An additional
check upon receipts by doubling the measure of weight in rating sealed
correspondence and diminishing one-half the charge for newspaper carriage
was imposed by legislation which took effect with the beginning of the past
fiscal year, while the constant demand of our territorial development and
growing population for the extension and increase of mail facilities and
machinery necessitates steady annual advance in outlay, and the careful
estimate of a year ago upon the rates of expenditure then existing
contemplated the unavoidable augmentation of the deficiency in the last
fiscal year by nearly $2,000,000. The anticipated revenue for the last year
failed of realization by about $64,000, but proper measures of economy have
so satisfactorily limited the growth of expenditure that the total
deficiency in fact fell below that of 1885, and at this time the increase
of revenue is in a gaining ratio over the increase of cost, demonstrating
the sufficiency of the present rates of postage ultimately to sustain the
service. This is the more pleasing because our people enjoy now both
cheaper postage proportionably to distances and a vaster and more costly
service than any other upon the globe.

Retrenchment has been effected in the cost of supplies, some expenditures
unwarranted by law have ceased, and the outlays for mail carriage have been
subjected to beneficial scrutiny. At the close of the last fiscal year the
expense of transportation on star routes stood at an annual rate of cost
less by over $560,000 than at the close of the previous year and steamboat
and mail-messenger service at nearly $200,000 less.

The service has been in the meantime enlarged and extended by the
establishment of new offices, increase of routes of carriage, expansion of
carrier-delivery conveniences, and additions to the railway mail
facilities, in accordance with the growing exigencies of the country and
the long-established policy of the Government.

The Postmaster-General calls attention to the existing law for compensating
railroads and expresses the opinion that a method may be devised which will
prove more just to the carriers and beneficial to the Government; and the
subject appears worthy of your early consideration.

The differences which arose during the year with certain of the ocean
steamship companies have terminated by the acquiescence of all in the
policy of the Government approved by the Congress in the postal
appropriation at its last session, and the Department now enjoys the utmost
service afforded by all vessels which sail from our ports upon either
ocean--a service generally adequate to the needs of our intercourse.
Petitions have, however, been presented to the Department by numerous
merchants and manufacturers for the establishment of a direct service to
the Argentine Republic and for semimonthly dispatches to the Empire of
Brazil, and the subject is commended to your consideration. It is an
obvious duty to provide the means of postal communication which our
commerce requires, and with prudent forecast of results the wise extension
of it may lead to stimulating intercourse and become the harbinger of a
profitable traffic which will open new avenues for the disposition of the
products of our industry. The circumstances of the countries at the far
south of our continent are such as to invite our enterprise and afford the
promise of sufficient advantages to justify an unusual effort to bring
about the closer relations which greater freedom of communication would
tend to establish.

I suggest that, as distinguished from a grant or subsidy for the mere
benefit of any line of trade or travel, whatever outlay may be required to
secure additional postal service, necessary and proper and not otherwise
attainable, should be regarded as within the limit of legitimate
compensation for such service.

The extension of the free-delivery service as suggested by the
Postmaster-General has heretofore received my sanction, and it is to be
hoped a suitable enactment may soon be agreed upon.

The request for an appropriation sufficient to enable the general
inspection of fourth-class offices has my approbation.

I renew my approval of the recommendation of the Postmaster-General that
another assistant be provided for the Post-Office Department, and I invite
your attention to the several other recommendations in his report.

The conduct of the Department of Justice for the last fiscal year is fully
detailed in the report of the Attorney-General, and I invite the earnest
attention of the Congress to the same and due consideration of the
recommendations therein contained.

In the report submitted by this officer to the last session of the Congress
he strongly recommended the erection of a penitentiary for the confinement
of prisoners convicted and sentenced in the United States courts, and he
repeats the recommendation in his report for the last year.

This is a matter of very great importance and should at once receive
Congressional action. United States prisoners are now confined in more than
thirty different State prisons and penitentiaries scattered in every part
of the country. They are subjected to nearly as many different modes of
treatment and discipline and are far too much removed from the control and
regulation of the Government. So far as they are entitled to humane
treatment and an opportunity for improvement and reformation, the
Government is responsible to them and society that these things are
forthcoming. But this duty can scarcely be discharged without more absolute
control and direction than is possible under the present system.

Many of our good citizens have interested themselves, with the most
beneficial results, in the question of prison reform. The General
Government should be in a situation, since there must be United States
prisoners, to furnish important aid in this movement, and should be able to
illustrate what may be practically done in the direction of this reform and
to present an example in the treatment and improvement of its prisoners
worthy of imitation.

With prisons under its own control the Government could deal with the
somewhat vexed question of convict labor, so far as its convicts were
concerned, according to a plan of its own adoption, and with due regard to
the rights and interests of our laboring citizens, instead of sometimes
aiding in the operation of a system which causes among them irritation and
discontent.

Upon consideration of this subject it might be thought wise to erect more
than one of these institutions, located in such places as would best
subserve the purposes of convenience and economy in transportation. The
considerable cost of maintaining these convicts as at present, in State
institutions, would be saved by the adoption of the plan proposed, and by
employing them in the manufacture of such articles as were needed for use
by the Government quite a large pecuniary benefit would be realized in
partial return for our outlay.

I again urge a change in the Federal judicial system to meet the wants of
the people and obviate the delays necessarily attending the present
condition of affairs in our courts. All are agreed that something should be
done, and much favor is shown by those well able to advise to the plan
suggested by the Attorney-General at the last session of the Congress and
recommended in my last annual message. This recommendation is here renewed,
together with another made at the same time, touching a change in the
manner of compensating district attorneys and marshals; and the latter
subject is commended to the Congress for its action in the interest of
economy to the Government, and humanity, fairness, and justice to our
people.

The report of the Secretary of the Interior presents a comprehensive
summary of the work of the various branches of the public service connected
with his Department, and the suggestions and recommendations which it
contains for the improvement of the service should receive your careful
consideration.

The exhibit made of the condition of our Indian population and the progress
of the work for their enlightenment, notwithstanding the many
embarrassments which hinder the better administration of this important
branch of the service, is a gratifying and hopeful one.

The funds appropriated for the Indian service for the fiscal year just
passed, with the available income from Indian land and trust moneys,
amounting in all to $7,850,775.12, were ample for the service under the
conditions and restrictions of laws regulating their expenditure. There
remained a balance on hand on June 30, 1886, of $1,660,023.30, of which $
1,337,768.21 are permanent funds for fulfillment of treaties and other like
purposes, and the remainder, $322,255.09, is subject to be carried to the
surplus fund as required by law.

The estimates presented for appropriations for the ensuing fiscal year
amount to $5,608,873.64, or $442,386.20 less than those laid before the
Congress last year.

The present system of agencies, while absolutely necessary and well adapted
for the management of our Indian affairs and for the ends in view when it
was adopted, is in the present stage of Indian management inadequate,
standing alone, for the accomplishment of an object which has become
pressing in its importance--the more rapid transition from tribal
organizations to citizenship of such portions of the Indians as are capable
of civilized life.

When the existing system was adopted, the Indian race was outside of the
limits of organized States and Territories and beyond the immediate reach
and operation of civilization, and all efforts were mainly directed to the
maintenance of friendly relations and the preservation of peace and quiet
on the frontier. All this is now changed. There is no such thing as the
Indian frontier. Civilization, with the busy hum of industry and the
influences of Christianity, surrounds these people at every point. None of
the tribes are outside of the bounds of organized government and society,
except that the Territorial system has not been extended over that portion
of the country known as the Indian Territory. As a race the Indians are no
longer hostile, but may be considered as submissive to the control of the
Government. Few of them only are troublesome. Except the fragments of
several bands, all are now gathered upon reservations.

It is no longer possible for them to subsist by the chase and the
spontaneous productions of the earth.

With an abundance of land, if furnished with the means and implements for
profitable husbandry, their life of entire dependence upon Government
rations from day to day is no longer defensible. Their inclination, long
fostered by a defective system of control, is to cling to the habits and
customs of their ancestors and struggle with persistence against the change
of life which their altered circumstances press upon them. But barbarism
and civilization can not live together. It is impossible that such
incongruous conditions should coexist on the same soil.

They are a portion of our people, are under the authority of our
Government, and have a peculiar claim upon and are entitled to the
fostering care and protection of the nation. The Government can not relieve
itself of this responsibility until they are so far trained and civilized
as to be able wholly to manage and care for themselves. The paths in which
they should walk must be clearly marked out for them, and they must be led
or guided until they are familiar with the way and competent to assume the
duties and responsibilities of our citizenship.

Progress in this great work will continue only at the present slow pace and
at great expense unless the system and methods of management are improved
to meet the changed conditions and urgent demands of the service.

The agents, having general charge and supervision in many cases of more
than 5,000 Indians, scattered over large reservations, and burdened with
the details of accountability for funds and supplies, have time to look
after the industrial training and improvement of a few Indians only. The
many are neglected and remain idle and dependent, conditions not favorable
for progress and civilization.

The compensation allowed these agents and the conditions of the service are
not calculated to secure for the work men who are fitted by ability and
skill to properly plan and intelligently direct the methods best adapted to
produce the most speedy results and permanent benefits.

Hence the necessity for a supplemental agency or system directed to the end
of promoting the general and more rapid transition of the tribes from
habits and customs of barbarism to the ways of civilization.

With an anxious desire to devise some plan of operation by which to secure
the welfare of the Indians and to relieve the Treasury as far as possible
from the support of an idle and dependent population, I recommended in my
previous annual message the passage of a law authorizing the appointment of
a commission as an instrumentality auxiliary to those already established
for the care of the Indians. It was designed that this commission should be
composed of six intelligent and capable persons--three to be detailed from
the Army--having practical ideas upon the subject of the treatment of
Indians and interested in their welfare, and that it should be charged,
under the direction of the Secretary of the Interior, with the management
of such matters of detail as can not with the present organization be
properly and successfully conducted, and which present different phases, as
the Indians themselves differ in their progress, needs, disposition, and
capacity for improvement or immediate self-support.

By the aid of such a commission much unwise and useless expenditure of
money, waste of materials, and unavailing efforts might be avoided; and it
is hoped that this or some measure which the wisdom of Congress may better
devise to supply the deficiency of the present system may receive your
consideration and the appropriate legislation be provided.

The time is ripe for the work of such an agency.

There is less opposition to the education and training of the Indian youth,
as shown by the increased attendance upon the schools, and there is a
yielding tendency for the individual holding of lands. Development and
advancement in these directions are essential, and should have every
encouragement. As the rising generation are taught the language of
civilization and trained in habits of industry they should assume the
duties, privileges, and responsibilities of citizenship.

No obstacle should hinder the location and settlement of any Indian willing
to take land in severalty; on the contrary, the inclination to do so should
be stimulated at all times when proper and expedient. But there is no
authority of law for making allotments on some of the reservations, and on
others the allotments provided for are so small that the Indians, though
ready and desiring to settle down, are not willing to accept such small
areas when their reservations contain ample lands to afford them homesteads
of sufficient size to meet their present and future needs.

These inequalities of existing special laws and treaties should be
corrected and some general legislation on the subject should be provided,
so that the more progressive members of the different tribes may be settled
upon homesteads, and by their example lead others to follow, breaking away
from tribal customs and substituting therefor the love of home, the
interest of the family, and the rule of the state.

The Indian character and nature are such that they are not easily led while
brooding over unadjusted wrongs. This is especially so regarding their
lands. Matters arising from the construction and operation of railroads
across some of the reservations, and claims of title and right of occupancy
set up by white persons to some of the best land within other reservations
require legislation for their final adjustment.

The settlement of these matters will remove many embarrassments to progress
in the work of leading the Indians to the adoption of our institutions and
bringing them under the operation, the influence, and the protection of the
universal laws of our country.

The recommendations of the Secretary of the Interior and the Commissioner
of the General Land Office looking to the better protection of public lands
and of the public surveys, the preservation of national forests, the
adjudication of grants to States and corporations and of private land
claims, and the increased efficiency of the public-land service are
commended to the attention of Congress. To secure the widest distribution
of public lands in limited quantities among settlers for residence and
cultivation, and thus make the greatest number of individual homes, was the
primary object of the public-land legislation in the early days of the
Republic. This system was a simple one. It commenced with an admirable
scheme of public surveys, by which the humblest citizen could identify the
tract upon which he wished to establish his home. The price of lands was
placed within the reach of all the enterprising, industrious, and honest
pioneer citizens of the country. It was soon, however, found that the
object of the laws was perverted, under the system of cash sales, from a
distribution of land among the people to an accumulation of land capital by
wealthy and speculative persons. To check this tendency a preference right
of purchase was given to settlers on the land, a plan which culminated in
the general preemption act of 1841. The foundation of this system was
actual residence and cultivation. Twenty years later the homestead law was
devised to more surely place actual homes in the possession of actual
cultivators of the soil. The land was given without price, the sole
conditions being residence, improvement, and cultivation. Other laws have
followed, each designed to encourage the acquirement and use of land in
limited individual quantities. But in later years these laws, through
vicious administrative methods and under changed conditions of
communication and transportation, have been so evaded and violated that
their beneficent purpose is threatened with entire defeat. The methods of
such evasions and violations are set forth in detail in the reports of the
Secretary of the Interior and Commissioner of the General Land Office. The
rapid appropriation of our public lands without bona fide settlements or
cultivation, and not only without intention of residence, but for the
purpose of their aggregation in large holdings, in many cases in the hands
of foreigners, invites the serious and immediate attention of the
Congress.

The energies of the Land Department have been devoted during the present
Administration to remedy defects and correct abuses in the public-land
service. The results of these efforts are so largely in the nature of
reforms in the processes and methods of our land system as to prevent
adequate estimate; but it appears by a compilation from the reports of the
Commissioner of the General Land Office that the immediate effect in
leading cases which have come to a final termination has been the
restoration to the mass of public lands of 2,750,000 acres; that 2,370,000
acres are embraced in investigations now pending before the Department or
the courts, and that the action of Congress has been asked to effect the
restoration of 2,790,000 acres additional; besides which 4,000,000 acres
have been withheld from reservation and the rights of entry thereon
maintained.

I recommend the repeal of the preemption and timber-culture acts, and that
the homestead laws be so amended as to better secure compliance with their
requirements of residence, improvement, and cultivation for the period of
five years from date of entry, without commutation or provision for
speculative relinquishment. I also recommend the repeal of the desert-land
laws unless it shall be the pleasure of the Congress to so amend these laws
as to render them less liable to abuses. As the chief motive for an evasion
of the laws and the principal cause of their result in land accumulation
instead of land distribution is the facility with which transfers are made
of the right intended to be secured to settlers, it may be deemed advisable
to provide by legislation some guards and checks upon the alienation of
homestead rights and lands covered thereby until patents issue.

Last year an Executive proclamation was issued directing the removal of
fences which inclosed the public domain. Many of these have been removed in
obedience to such order, but much of the public land still remains within
the lines of these unlawful fences. The ingenious methods resorted to in
order to continue these trespasses and the hardihood of the pretenses by
which in some cases such inclosures are justified are fully detailed in the
report of the Secretary of the Interior.

The removal of the fences still remaining which inclose public lands will
be enforced with all the authority and means with which the executive
branch of the Government is or shall be invested by the Congress for that
purpose.

The report of the Commissioner of Pensions contains a detailed and most
satisfactory exhibit of the operations of the Pension Bureau during the
last fiscal year. The amount of work done was the largest in any year since
the organization of the Bureau, and it has been done at less cost than
during the previous year in every division.

On the 30th day of June, 1886, there were 365,783 pensioners on the rolls
of the Bureau.

Since 1861 there have been 1,018,735 applications for pensions filed, of
which 78,834 were based upon service in the War of 1812. There were 621,754
of these applications allowed, including 60,178 to the soldiers of 1812 and
their widows.

The total amount paid for pensions since 1861 is $808,624,811.57.

The number of new pensions allowed during the year ended June 30, 1886, is
40,857, a larger number than has been allowed in any year save one since
1861. The names of 2,229 pensioners which had been previously dropped from
the rolls were restored during the year, and after deducting those dropped
within the same time for various causes a net increase remains for the year
of 20,658 names.

From January 1, 1861, to December 1, 1885, 1,967 private pension acts had
been passed. Since the last-mentioned date, and during the last session of
the Congress, 644 such acts became laws.

It seems to me that no one can examine our pension establishment and its
operations without being convinced that through its instrumentality justice
can be very nearly done to all who are entitled under present laws to the
pension bounty of the Government.

But it is undeniable that cases exist, well entitled to relief, in which
the Pension Bureau is powerless to aid. The really worthy cases of this
class are such as only lack by misfortune the kind or quantity of proof
which the law and regulations of the Bureau require, or which, though their
merit is apparent, for some other reason can not be justly dealt with
through general laws. These conditions fully justify application to the
Congress and special enactments. But resort to the Congress for a special
pension act to overrule the deliberate and careful determination of the
Pension Bureau on the merits or to secure favorable action when it could
not be expected under the most liberal execution of general laws, it must
be admitted opens the door to the allowance of questionable claims and
presents to the legislative and executive branches of the Government
applications concededly not within the law and plainly devoid of merit, but
so surrounded by sentiment and patriotic feeling that they are hard to
resist. I suppose it will not be denied that many claims for pension are
made without merit and that many have been allowed upon fraudulent
representations. This has been declared from the Pension Bureau, not only
in this but in prior Administrations.

The usefulness and the justice of any system for the distribution of
pensions depend upon the equality and uniformity of its operation.

It will be seen from the report of the Commissioner that there are now paid
by the Government 131 different rates of pension.

He estimates from the best information he can obtain that 9,000 of those
who have served in the Army and Navy of the United States are now
supported, in whole or in part, from public funds or by organized
charities, exclusive of those in soldiers' homes under the direction and
control of the Government. Only 13 per cent of these are pensioners, while
of the entire number of men furnished for the late war something like 20
per cent, including their widows and relatives, have been or now are in
receipt of pensions.

The American people, with a patriotic and grateful regard for our
ex-soldiers, too broad and too sacred to be monopolized by any special
advocates, are not only willing but anxious that equal and exact justice
should be done to all honest claimants for pensions. In their sight the
friendless and destitute soldier, dependent on public charity, if otherwise
entitled, has precisely the same right to share in the provision made for
those who fought their country's battles as those better able, through
friends and influence, to push their claims. Every pension that is granted
under our present plan upon any other grounds than actual service and
injury or disease incurred in such service, and every instance of the many
in which pensions are increased on other grounds than the merits of the
claim, work an injustice to the brave and crippled, but poor and
friendless, soldier, who is entirely neglected or who must be content with
the smallest sum allowed under general laws.

There are far too many neighborhoods in which are found glaring cases of
inequality of treatment in the matter of pensions, and they are largely due
to a yielding in the Pension Bureau to importunity on the part of those,
other than the pensioner, who are especially interested, or they arise from
special acts passed for the benefit of individuals.

The men who fought side by side should stand side by side when they
participate in a grateful nation's kind remembrance.

Every consideration of fairness and justice to our ex-soldiers and the
protection of the patriotic instinct of our citizens from perversion and
violation point to the adoption of a pension system broad and comprehensive
enough to cover every contingency, and which shall make unnecessary an
objectionable volume of special legislation.

As long as we adhere to the principle of granting pensions for service, and
disability as the result of the service, the allowance of pensions should
be restricted to cases presenting these features.

Every patriotic heart responds to a tender consideration for those who,
having served their country long and well, are reduced to destitution and
dependence, not as an incident of their service, but with advancing age or
through sickness or misfortune. We are all tempted by the contemplation of
such a condition to supply relief, and are often impatient of the
limitations of public duty. Yielding to no one in the desire to indulge
this feeling of consideration, I can not rid myself of the conviction that
if these ex-soldiers are to be relieved they and their cause are entitled
to the benefit of an enactment under which relief may be claimed as a
right, and that such relief should be granted under the sanction of law,
not in evasion of it; nor should such worthy objects of care, all equally
entitled, be remitted to the unequal operation of sympathy or the tender
mercies of social and political influence, with their unjust
discriminations.

The discharged soldiers and sailors of the country are our fellow-citizens,
and interested with us in the passage and faithful execution of wholesome
laws. They can not be swerved from their duty of citizenship by artful
appeals to their spirit of brotherhood born of common peril and suffering,
nor will they exact as a test of devotion to their welfare a willingness to
neglect public duty in their behalf.

On the 4th of March, 1885, the current business of the Patent Office was,
on an average, five and a half months in arrears, and in several divisions
more than twelve months behind. At the close of the last fiscal year such
current work was but three months in arrears, and it is asserted and
believed that in the next few months the delay in obtaining an examination
of an application for a patent will be but nominal.

The number of applications for patents during the last fiscal year,
including reissues, designs, trade-marks, and labels, equals 40,678, which
is considerably in excess of the number received during any preceding
year.

The receipts of the Patent Office during the year aggregate $1,205,167.80,
enabling the office to turn into the Treasury a surplus revenue, over and
above all expenditures, of about $163,710.30.

The number of patents granted during the last fiscal year, including
reissues, trade-marks, designs, and labels, was 25,619, a number also quite
largely in excess of that of any preceding year.

The report of the Commissioner shows the office to be in a prosperous
condition and constantly increasing in its business. No increase of force
is asked for.

The amount estimated for the fiscal year ending June 30, 1886, was
$890,760. The amount estimated for the year ending June 30, 1887, was
$853,960. The amount estimated for the fiscal year ending June 30, 1888, is
$778,770.

The Secretary of the Interior suggests a change in the plan for the payment
of the indebtedness of the Pacific subsidized roads to the Government. His
suggestion has the unanimous indorsement of the persons selected by the
Government to act as directors of these roads and protect the interests of
the United States in the board of direction. In considering the plan
proposed the sole matters which should be taken into account, in my
opinion, are the situation of the Government as a creditor and the surest
way to secure the payment of the principal and interest of its debt.

By a recent decision of the Supreme Court of the United States it has been
adjudged that the laws of the several States are inoperative to regulate
rates of transportation upon railroads if such regulation interferes with
the rate of carriage from one State into another. This important field of
control and regulation having been thus left entirely unoccupied, the
expediency of Federal action upon the subject is worthy of consideration.

The relations of labor to capital and of laboring men to their employers
are of the utmost concern to every patriotic citizen. When these are
strained and distorted, unjustifiable claims are apt to be insisted upon by
both interests, and in the controversy which results the welfare of all and
the prosperity of the country are jeopardized. Any intervention of the
General Government, within the limits of its constitutional authority, to
avert such a condition should be willingly accorded.

In a special message transmitted to the Congress at its last session I
suggested the enlargement of our present Labor Bureau and adding to its
present functions the power of arbitration in cases where differences arise
between employer and employed. When these differences reach such a stage as
to result in the interruption of commerce between the States, the
application of this remedy by the General Government might be regarded as
entirely within its constitutional powers. And I think we might reasonably
hope that such arbitrators, if carefully selected and if entitled to the
confidence of the parties to be affected, would be voluntarily called to
the settlement of controversies of less extent and not necessarily within
the domain of Federal regulation.

I am of the opinion that this suggestion is worthy the attention of the
Congress.

But after all has been done by the passage of laws, either Federal or
State, to relieve a situation full of solicitude, much more remains to be
accomplished by the reinstatement and cultivation of a true American
sentiment which recognizes the equality of American citizenship. This, in
the light of our traditions and in loyalty to the spirit of our
institutions, would teach that a hearty cooperation on the part of all
interests is the surest path to national greatness and the happiness of all
our people; that capital should, in recognition of the brotherhood of our
citizenship and in a spirit of American fairness, generously accord to
labor its just compensation and consideration, and that contented labor is
capital's best protection and faithful ally. It would teach, too, that the
diverse situations of our people are inseparable from our civilization;
that every citizen should in his sphere be a contributor to the general
good; that capital does not necessarily tend to the oppression of labor,
and that violent disturbances and disorders alienate from their promoters
true American sympathy and kindly feeling.

The Department of Agriculture, representing the oldest and largest of our
national industries, is subserving well the purposes of its organization.
By the introduction of new subjects of farming enterprise and by opening
new sources of agricultural wealth and the dissemination of early
information concerning production and prices it has contributed largely to
the country's prosperity. Through this agency advanced thought and
investigation touching the subjects it has in charge should, among other
things, be practically applied to the home production at a low cost of
articles of food which are now imported from abroad. Such an innovation
will necessarily, of course, in the beginning be within the domain of
intelligent experiment, and the subject in every stage should receive all
possible encouragement from the Government.

The interests of millions of our citizens engaged in agriculture are
involved in an enlargement and improvement of the results of their labor,
and a zealous regard for their welfare should be a willing tribute to those
whose productive returns are a main source of our progress and power.

The existence of pleuro-pneumonia among the cattle of various States has
led to burdensome and in some cases disastrous restrictions in an important
branch of our commerce, threatening to affect the quantity and quality of
our food supply. This is a matter of such importance and of such
far-reaching consequences that I hope it will engage the serious attention
of the Congress, to the end that such a remedy may be applied as the limits
of a constitutional delegation of power to the General Government will
permit.

I commend to the consideration of the Congress the report of the
Commissioner and his suggestions concerning the interest intrusted to his
care.

The continued operation of the law relating to our civil service has added
the most convincing proofs of its necessity and usefulness. It is a fact
worthy of note that every public officer who has a just idea of his duty to
the people testifies to the value of this reform. Its staunchest, friends
are found among those who understand it best, and its warmest supporters
are those who are restrained and protected by its requirements.

The meaning of such restraint and protection is not appreciated by those
who want places under the Government regardless of merit and efficiency,
nor by those who insist that the selection of such places should rest upon
a proper credential showing active partisan work. They mean to public
officers, if not their lives, the only opportunity afforded them to attend
to public business, and they mean to the good people of the country the
better performance of the work of their Government.

It is exceedingly strange that the scope and nature of this reform are so
little understood and that so many things not included within its plan are
called by its name. When cavil yields more fully to examination, the system
will have large additions to the number of its friends.

Our civil-service reform may be imperfect in some of its details; it may be
misunderstood and opposed; it may not always be faithfully applied; its
designs may sometimes miscarry through mistake or willful intent; it may
sometimes tremble under the assaults of its enemies or languish under the
misguided zeal of impracticable friends; but if the people of this country
ever submit to the banishment of its underlying principle from the
operation of their Government they will abandon the surest guaranty of the
safety and success of American institutions.

I invoke for this reform the cheerful and ungrudging support of the
Congress. I renew my recommendation made last year that the salaries of the
Commissioners be made equal to other officers of the Government having like
duties and responsibilities, and I hope that such reasonable appropriations
may be made as will enable them to increase the usefulness of the cause
they have in charge.

I desire to call the attention of the Congress to a plain duty which the
Government owes to the depositors in the Freedman's Savings and Trust
Company.

This company was chartered by the Congress for the benefit of the most
illiterate and humble of our people, and with the intention of encouraging
in them industry and thrift. Most of its branches were presided over by
officers holding the commissions and clothed in the uniform of the United
States. These and other circumstances reasonably, I think, led these simple
people to suppose that the invitation to deposit their hard-earned savings
in this institution implied an undertaking on the part of their Government
that their money should be safely kept for them.

When this company failed, it was liable in the sum of $2,939,925.22 to
61,131 depositors. Dividends amounting in the aggregate to 62 per cent have
been declared, and the sum called for and paid of such dividends seems to
be $1,648,181.72. This sum deducted from the entire amount of deposits
leaves $1,291,744.50 still unpaid. Past experience has shown that quite a
large part of this sum will not be called for. There are assets still on
hand amounting to the estimated sum of $16,000.

I think the remaining 38 per cent of such of these deposits as have
claimants should be paid by the Government, upon principles of equity and
fairness.

The report of the commissioner, soon to be laid before Congress, will give
more satisfactory details on this subject.

The control of the affairs of the District of Columbia having been placed
in the hands of purely executive officers, while the Congress still retains
all legislative authority relating to its government, it becomes my duty to
make known the most pressing needs of the District and recommend their
consideration.

The laws of the District appear to be in an uncertain and unsatisfactory
condition, and their codification or revision is much needed.

During the past year one of the bridges leading from the District to the
State of Virginia became unfit for use, and travel upon it was forbidden.
This leads me to suggest that the improvement of all the bridges crossing
the Potomac and its branches from the city of Washington is worthy the
attention of Congress.

The Commissioners of the District represent that the laws regulating the
sale of liquor and granting licenses therefor should be at once amended,
and that legislation is needed to consolidate, define, and enlarge the
scope and powers of charitable and penal institutions within the District.

I suggest that the Commissioners be clothed with the power to make, within
fixed limitations, police regulations. I believe this power granted and
carefully guarded would tend to subserve the good order of the
municipality.

It seems that trouble still exists growing out of the occupation of the
streets and avenues by certain railroads having their termini in the city.
It is very important that such laws should be enacted upon this subject as
will secure to the railroads all the facilities they require for the
transaction of their business and at the same time protect citizens from
injury to their persons or property.

The Commissioners again complain that the accommodations afforded them for
the necessary offices for District business and for the safe-keeping of
valuable books and papers are entirely insufficient. I recommend that this
condition of affairs be remedied by the Congress, and that suitable
quarters be furnished for the needs of the District government.

In conclusion I earnestly invoke such wise action on the part of the
people's legislators as will subserve the public good and demonstrate
during the remaining days of the Congress as at present organized its
ability and inclination to so meet the people's needs that it shall be
gratefully remembered by an expectant constituency.

***

State of the Union Address
Grover Cleveland
December 6, 1887

To the Congress of the United States:

You are confronted at the threshold of your legislative duties with a
condition of the national finances which imperatively demands immediate and
careful consideration.

The amount of money annually exacted, through the operation of present
laws, from the industries and necessities of the people largely exceeds the
sum necessary to meet the expenses of the Government.

When we consider that the theory of our institutions guarantees to every
citizen the full enjoyment of all the fruits of his industry and
enterprise, with only such deduction as may be his share toward the careful
and economical maintenance of the Government which protects him, it is
plain that the exaction of more than this is indefensible extortion and a
culpable betrayal of American fairness and justice. This wrong inflicted
upon those who bear the burden of national taxation, like other wrongs,
multiplies a brood of evil consequences. The public Treasury, which should
only exist as a conduit conveying the people's tribute to its legitimate
objects of expenditure, becomes a hoarding place for money needlessly
withdrawn from trade and the people's use, thus crippling our national
energies, suspending our country's development, preventing investment in
productive enterprise, threatening financial disturbance, and inviting
schemes of public plunder.

This condition of our Treasury is not altogether new, and it has more than
once of late been submitted to the people's representatives in the
Congress, who alone can apply a remedy. And yet the situation still
continues, with aggravated incidents, more than ever presaging financial
convulsion and widespread disaster.

It will not do to neglect this situation because its dangers are not now
palpably imminent and apparent. They exist none the less certainly, and
await the unforeseen and unexpected occasion when suddenly they will be
precipitated upon us.

On the 30th day of June, 1885, the excess of revenues over public
expenditures, after complying with the annual requirement of the
sinking-fund act, was $17,859,735.84; during the year ended June 30, 1886,
such excess amounted to $49,405,545.20, and during the year ended June 30,
1887, it reached the sum of $55,567,849.54.

The annual contributions to the sinking fund during the three years above
specified, amounting in the aggregate to $138,058,320.94, and deducted from
the surplus as stated, were made by calling in for that purpose outstanding
3 per cent bonds of the Government. During the six months prior to June 30,
1887, the surplus revenue had grown so large by repeated accumulations, and
it was feared the withdrawal of this great sum of money needed by the
people would so affect the business of the country, that the sum of
$79,864,100 of such surplus was applied to the payment of the principal and
interest of the 3 per cent bonds still outstanding, and which were then
payable at the option of the Government. The precarious condition of
financial affairs among the people still needing relief, immediately after
the 30th day of June, 1887, the remainder of the 3 per cent bonds then
outstanding, amounting with principal and interest to the sum of
$18,877,500, were called in and applied to the sinking-fund contribution
for the current fiscal year. Notwithstanding these operations of the
Treasury Department, representations of distress in business circles not
only continued, but increased, and absolute peril seemed at hand. In these
circumstances the contribution to the sinking fund for the current fiscal
year was at once completed by the expenditure of $27,684,283.55 in the
purchase of Government bonds not yet due bearing 4 and 41/2 per cent
interest, the premium paid thereon averaging about 24 per cent for the
former and 8 per cent for the latter. In addition to this, the interest
accruing during the current year upon the outstanding bonded indebtedness
of the Government was to some extent anticipated, and banks selected as
depositories of public money were permitted to somewhat increase their
deposits.

While the expedients thus employed to release to the people the money lying
idle in the Treasury served to avert immediate danger, our surplus revenues
have continued to accumulate, the excess for the present year amounting on
the 1st day of December to $55,258,701.19, and estimated to reach the sum
of $113,000,000 on the 30th of June next, at which date it is expected that
this sum, added to prior accumulations, will swell the surplus in the
Treasury to $140,000,000.

There seems to be no assurance that, with such a withdrawal from use of the
people's circulating medium, our business community may not in the near
future be subjected to the same distress which was quite lately produced
from the same cause. And while the functions of our National Treasury
should be few and simple, and while its best condition would be reached, I
believe, by its entire disconnection with private business interests, yet
when, by a perversion of its purposes, it idly holds money uselessly
subtracted from the channels of trade, there seems to be reason for the
claim that some legitimate means should be devised by the Government to
restore in an emergency, without waste or extravagance, such money to its
place among the people.

If such an emergency arises, there now exists no clear and undoubted
executive power of relief. Heretofore the redemption of 3 per cent bonds,
which were payable at the option of the Government, has afforded a means
for the disbursement of the excess of our revenues; but these bonds have
all been retired, and there are no bonds outstanding the payment of which
we have a right to insist upon. The contribution to the sinking fund which
furnishes the occasion for expenditure in the purchase of bonds has been
already made for the current year, so that there is no outlet in that
direction.

In the present state of legislation the only pretense of any existing
executive power to restore at this time any part of our surplus revenues to
the people by its expenditure consists in the supposition that the
Secretary of the Treasury may enter the market and purchase the bonds of
the Government not yet due, at a rate of premium to be agreed upon. The
only provision of law from which such a power could be derived is found in
an appropriation bill passed a number of years ago, and it is subject to
the suspicion that it was intended as temporary and limited in its
application, instead of conferring a continuing discretion and authority.
No condition ought to exist which would justify the grant of power to a
single official, upon his judgment of its necessity, to withhold from or
release to the business of the people, in an unusual manner, money held in
the Treasury, and thus affect at his will the financial situation of the
country; and if it is deemed wise to lodge in the Secretary of the Treasury
the authority in the present juncture to purchase bonds, it should be
plainly vested, and provided, as far as possible, with such checks and
limitations as will define this official's right and discretion and at the
same time relieve him from undue responsibility.

In considering the question of purchasing bonds as a means of restoring to
circulation the surplus money accumulating in the Treasury, it should be
borne in mind that premiums must of course be paid upon such purchase, that
there may be a large part of these bonds held as investments which can not
be purchased at any price, and that combinations among holders who are
willing to sell may unreasonably enhance the cost of such bonds to the
Government.

It has been suggested that the present bonded debt might be refunded at a
less rate of interest and the difference between the old and new security
paid in cash, thus finding use for the surplus in the Treasury. The success
of this plan, it is apparent, must depend upon the volition of the holders
of the present bonds; and it is not entirely certain that the inducement
which must be offered them would result in more financial benefit to the
Government than the purchase of bonds, while the latter proposition would
reduce the principal of the debt by actual payment instead of extending
it.

The proposition to deposit the money held by the Government in banks
throughout the country for use by the people is, it seems to me,
exceedingly objectionable in principle, as establishing too close a
relationship between the operations of the Government Treasury and the
business of the country and too extensive a commingling of their money,
thus fostering an unnatural reliance in private business upon public funds.
If this scheme should be adopted, it should only be done as a temporary
expedient to meet an urgent necessity. Legislative and executive effort
should generally be in the opposite direction, and should have a tendency
to divorce, as much and as fast as can be safely done, the Treasury
Department from private enterprise.

Of course it is not expected that unnecessary and extravagant
appropriations will be made for the purpose of avoiding the accumulation of
an excess of revenue. Such expenditure, besides the demoralization of all
just conceptions of public duty which it entails, stimulates a habit of
reckless improvidence not in the least consistent with the mission of our
people or the high and beneficent purposes of our Government.

I have deemed it my duty to thus bring to the knowledge of my countrymen,
as well as to the attention of their representatives charged with the
responsibility of legislative relief, the gravity of our financial
situation. The failure of the Congress heretofore to provide against the
dangers which it was quite evident the very nature of the difficulty must
necessarily produce caused a condition of financial distress and
apprehension since your last adjournment which taxed to the utmost all the
authority and expedients within executive control; and these appear now to
be exhausted. If disaster results from the continued inaction of Congress,
the responsibility must rest where it belongs.

Though the situation thus far considered is fraught with danger which
should be fully realized, and though it presents features of wrong to the
people as well as peril to the country, it is but a result growing out of a
perfectly palpable and apparent cause, constantly reproducing the same
alarming circumstances--a congested National Treasury and a depleted
monetary condition in the business of the country. It need hardly be stated
that while the present situation demands a remedy, we can only be saved
from a like predicament in the future by the removal of its cause.

Our scheme of taxation, by means of which this needless surplus is taken
from the people and put into the public Treasury, consists of a tariff or
duty levied upon importations from abroad and internal-revenue taxes levied
upon the consumption of tobacco and spirituous and malt liquors. It must be
conceded that none of the things subjected to internal-revenue taxation
are, strictly speaking, necessaries. There appears to be no just complaint
of this taxation by the consumers of these articles, and there seems to be
nothing so well able to bear the burden without hardship to any portion of
the people.

But our present tariff laws, the vicious, inequitable, and illogical source
of unnecessary taxation, ought to be at once revised and amended. These
laws, as their primary and plain effect, raise the price to consumers of
all articles imported and subject to duty by precisely the sum paid for
such duties. Thus the amount of the duty measures the tax paid by those who
purchase for use these imported articles. Many of these things, however,
are raised or manufactured in our own country, and the duties now levied
upon foreign goods and products are called protection to these home
manufactures, because they render it possible for those of our people who
are manufacturers to make these taxed articles and sell them for a price
equal to that demanded for the imported goods that have paid customs duty.
So it happens that while comparatively a few use the imported articles,
millions of our people, who never used and never saw any of the foreign
products, purchase and use things of the same kind made in this country,
and pay therefor nearly or quite the same enhanced price which the duty
adds to the imported articles. Those who buy imports pay the duty charged
thereon into the public Treasury, but the great majority of our citizens,
who buy domestic articles of the same class, pay a sum at least
approximately equal to this duty to the home manufacturer. This reference
to the operation of our tariff laws is not made by way of instruction, but
in order that we may be constantly reminded of the manner in which they
impose a burden upon those who consume domestic products as well as those
who consume imported articles, and thus create a tax upon all our people.

It is not proposed to entirely relieve the country of this taxation. It
must be extensively continued as the source of the Government's income; and
in a readjustment of our tariff the interests of American labor engaged in
manufacture should be carefully considered, as well as the preservation of
our manufacturers. It may be called protection or by any other name, but
relief from the hardships and dangers of our present tariff laws should be
devised with especial precaution against imperiling the existence of our
manufacturing interests. But this existence should not mean a condition
which, without regard to the public welfare or a national exigency, must
always insure the realization of immense profits instead of moderately
profitable returns. As the volume and diversity of our national activities
increase, new recruits are added to those who desire a continuation of the
advantages which they conceive the present system of tariff taxation
directly affords them. So stubbornly have all efforts to reform the present
condition been resisted by those of our fellow-citizens thus engaged that
they can hardly complain of the suspicion, entertained to a certain extent,
that there exists an organized combination all along the line to maintain
their advantage.

We are in the midst of centennial celebrations, and with becoming pride we
rejoice in American skill and ingenuity, in American energy and enterprise,
and in the wonderful natural advantages and resources developed by a
century's national growth. Yet when an attempt is made to justify a scheme
which permits a tax to be laid upon every consumer in the land for the
benefit of our manufacturers, quite beyond a reasonable demand for
governmental regard, it suits the purposes of advocacy to call our
manufactures infant industries still needing the highest and greatest
degree of favor and fostering care that can be wrung from Federal
legislation.

It is also said that the increase in the price of domestic manufactures
resulting from the present tariff is necessary in order that higher wages
may be paid to our workingmen employed in manufactories than are paid for
what is called the pauper labor of Europe. All will acknowledge the force
of an argument which involves the welfare and liberal compensation of our
laboring people. Our labor is honorable in the eyes of every American
citizen; and as it lies at the foundation of our development and progress,
it is entitled, without affectation or hypocrisy, to the utmost regard. The
standard of our laborers' life should not be measured by that of any other
country less favored, and they are entitled to their full share of all our
advantages.

By the last census it is made to appear that of the 17,392,099 of our
population engaged in all kinds of industries 7,670,493 are employed in
agriculture, 4,074,238 in professional and personal service (2,934,876 of
whom are domestic servants and laborers), while 1,810,256 are employed in
trade and transportation and 3,837,112 are classed as employed in
manufacturing and mining.

For present purposes, however, the last number given should be considerably
reduced. Without attempting to enumerate all, it will be conceded that
there should be deducted from those which it includes 375,143 carpenters
and joiners, 285,401 milliners, dressmakers, and seamstresses, 172,726
blacksmiths, 133,756 tailors and tailoresses, 102,473 masons, 76,241
butchers, 41,309 bakers, 22,083 plasterers, and 4,891 engaged in
manufacturing agricultural implements, amounting in the aggregate to
1,214,023, leaving 2,623,089 persons employed in such manufacturing
industries as are claimed to be benefited by a high tariff.

To these the appeal is made to save their employment and maintain their
wages by resisting a change. There should be no disposition to answer such
suggestions by the allegation that they are in a minority among those who
labor, and therefore should forego an advantage in the interest of low
prices for the majority. Their compensation, as it may be affected by the
operation of tariff laws, should at all times be scrupulously kept in view;
and yet with slight reflection they will not overlook the fact that they
are consumers with the rest; that they too have their own wants and those
of their families to supply from their earnings, and that the price of the
necessaries of life, as well as the amount of their wages, will regulate
the measure of their welfare and comfort.

But the reduction of taxation demanded should be so measured as not to
necessitate or justify either the loss of employment by the workingman or
the lessening of his wages; and the profits still remaining to the
manufacturer after a necessary readjustment should furnish no excuse for
the sacrifice of the interests of his employees, either in their
opportunity to work or in the diminution of their compensation. Nor can the
worker in manufactures fail to understand that while a high tariff is
claimed to be necessary to allow the payment of remunerative wages, it
certainly results in a very large increase in the price of nearly all sorts
of manufactures, which, in almost countless forms, he needs for the use of
himself and his family. He receives at the desk of his employer his wages,
and perhaps before he reaches his home is obliged, in a purchase for family
use of an article which embraces his own labor, to return in the payment of
the increase in price which the tariff permits the hard-earned compensation
of many days of toil.

The farmer and the agriculturist, who manufacture nothing, but who pay the
increased price which the tariff imposes upon every agricultural implement,
upon all he wears, and upon all he uses and owns, except the increase of
his flocks and herds and such things as his husbandry produces from the
soil, is invited to aid in maintaining the present situation; and he is
told that a high duty on imported wool is necessary for the benefit of
those who have sheep to shear, in order that the price of their wool may be
increased. They, of course, are not reminded that the farmer who has no
sheep is by this scheme obliged, in his purchases of clothing and woolen
goods, to pay a tribute to his fellow-farmer as well as to the manufacturer
and merchant, nor is any mention made of the fact that the sheep owners
themselves and their households must wear clothing and use other articles
manufactured from the wool they sell at tariff prices, and thus as
consumers must return their share of this increased price to the
tradesman.

I think it may be fairly assumed that a large proportion of the sheep owned
by the farmers throughout the country are found in small flocks, numbering
from twenty-five to fifty. The duty on the grade of imported wool which
these sheep yield is 10 cents each pound if of the value of 30 cents or
less and 12 cents if of the value of more than 30 cents. If the liberal
estimate of 6 pounds be allowed for each fleece, the duty thereon would be
60 or 72 cents; and this may be taken as the utmost enhancement of its
price to the farmer by reason of this duty. Eighteen dollars would thus
represent the increased price of the wool from twenty-five sheep and $36
that from the wool of fifty sheep; and at present values this addition
would amount to about one-third of its price. If upon its sale the farmer
receives this or a less tariff profit, the wool leaves his hands charged
with precisely that sum, which in all its changes will adhere to it until
it reaches the consumer. When manufactured into cloth and other goods and
material for use, its cost is not only increased to the extent of the
farmer's tariff profit, but a further sum has been added for the benefit of
the manufacturer under the operation of other tariff laws. In the meantime
the day arrives when the farmer finds it necessary to purchase woolen goods
and material to clothe himself and family for the winter. When he faces the
tradesman for that purpose, he discovers that he is obliged not only to
return in the way of increased prices his tariff profit on the wool he
sold, and which then perhaps lies before him in manufactured form, but that
he must add a considerable sum thereto to meet a further increase in cost
caused by a tariff duty on the manufacture. Thus in the end he is aroused
to the fact that he has paid upon a moderate purchase, as a result of the
tariff scheme, which when he sold his wool seemed so profitable, an
increase in price more than sufficient to sweep away all the tariff profit
he received upon the wool he produced and sold.

When the number of farmers engaged in wool raising is compared with all the
farmers in the country and the small proportion they bear to our population
is considered; when it is made apparent that in the case of a large part of
those who own sheep the benefit of the present tariff on wool is illusory;
and, above all, when it must be conceded that the increase of the cost of
living caused by such tariff becomes a burden upon those with moderate
means and the poor, the employed and unemployed, the sick and well, and the
young and old, and that it constitutes a tax which with relentless grasp is
fastened upon the clothing of every man, woman, and child in the land,
reasons are suggested why the removal or reduction of this duty should be
included in a revision of our tariff laws.

In speaking of the increased cost to the consumer of our home manufactures
resulting from a duty laid upon imported articles of the same description,
the fact is not ever looked that competition among our domestic producers
sometimes has the effect of keeping the price of their products below the
highest limit allowed by such duty. But it is notorious that this
competition is too often strangled by combinations quite prevalent at this
time, and frequently called trusts, which have for their object the
regulation of the supply and price of commodities made and sold by members
of the combination. The people can hardly hope for any consideration in the
operation of these selfish schemes.

If, however, in the absence of such combination, a healthy and free
competition reduces the price of any particular dutiable article of home
production below the limit which it might otherwise reach under our tariff
laws, and if with such reduced price its manufacture continues to thrive,
it is entirely evident that one thing has been discovered which should be
carefully scrutinized in an effort to reduce taxation.

The necessity of combination to maintain the price of any commodity to the
tariff point furnishes proof that someone is willing to accept lower prices
for such commodity and that such prices are remunerative; and lower prices
produced by competition prove the same thing. Thus where either of these
conditions exists a case would seem to be presented for an easy reduction
of taxation.

The considerations which have been presented touching our tariff laws are
intended only to enforce an earnest recommendation that the surplus
revenues of the Government be prevented by the reduction of our customs
duties, and at the same time to emphasize a suggestion that in
accomplishing this purpose we may discharge a double duty to our people by
granting to them a measure of relief from tariff taxation in quarters where
it is most needed and from sources where it can be most fairly and justly
accorded.

Nor can the presentation made of such considerations be with any degree of
fairness regarded as evidence of unfriendliness toward our manufacturing
interests or of any lack of appreciation of their value and importance.

These interests constitute a leading and most substantial element of our
national greatness and furnish the proud proof of our country's progress.
But if in the emergency that presses upon us our manufacturers are asked to
surrender something for the public good and to avert disaster, their
patriotism, as well as a grateful recognition of advantages already
afforded, should lead them to willing cooperation. No demand is made that
they shall forego all the benefits of governmental regard; but they can not
fail to be admonished of their duty, as well as their enlightened
self-interest and safety, when they are reminded of the fact that financial
panic and collapse, to which the present condition tends, afford no greater
shelter or protection to our manufactures than to other important
enterprises. Opportunity for safe, careful, and deliberate reform is now
offered; and none of us should be unmindful of a time when an abused and
irritated people, heedless of those who have resisted timely and reasonable
relief, may insist upon a radical and sweeping rectification of their
wrongs.

The difficulty attending a wise and fair revision of our tariff laws is not
underestimated. It will require on the part of the Congress great labor and
care, and especially a broad and national contemplation of the subject and
a patriotic disregard of such local and selfish claims as are unreasonable
and reckless of the welfare of the entire country.

Under our present laws more than 4,000 articles are subject to duty. Many
of these do not in any way compete with our own manufactures, and many are
hardly worth attention as subjects of revenue. A considerable reduction can
be made in the aggregate by adding them to the free list. The taxation of
luxuries presents no features of hardship; but the necessaries of life used
and consumed by all the people, the duty upon which adds to the cost of
living in every home, should be greatly cheapened.

The radical reduction of the duties imposed upon raw material used in
manufactures, or its free importation, is of course an important factor in
any effort to reduce the price of these necessaries. It would not only
relieve them from the increased cost caused by the tariff on such material,
but the manufactured product being thus cheapened that part of the tariff
now laid upon such product, as a compensation to our manufacturers for the
present price of raw material, could be accordingly modified. Such
reduction or free importation would serve besides to largely reduce the
revenue. It is not apparent how such a change can have any injurious effect
upon our manufacturers. On the contrary, it would appear to give them a
better chance in foreign markets with the manufacturers of other countries,
who cheapen their wares by free material. Thus our people might have the
opportunity of extending their sales beyond the limits of home consumption,
saving them from the depression, interruption in business, and loss caused
by a glutted domestic market and affording their employees more certain and
steady labor, with its resulting quiet and contentment.

The question thus imperatively presented for solution should be approached
in a spirit higher than partisanship and considered in the light of that
regard for patriotic duty which should characterize the action of those
intrusted with the weal of a confiding people. But the obligation to
declared party policy and principle is not wanting to urge prompt and
effective action. Both of the great political parties now represented in
the Government have by repeated and authoritative declarations condemned
the condition of our laws which permit the collection from the people of
unnecessary revenue, and have in the most solemn manner promised its
correction; and neither as citizens nor partisans are our countrymen in a
mood to condone the deliberate violation of these pledges.

Our progress toward a wise conclusion will not be improved by dwelling upon
the theories of protection and free trade. This savors too much of bandying
epithets. It is a condition which confronts us, not a theory. Relief from
this condition may involve a slight reduction of the advantages which we
award our home productions, but the entire withdrawal of such advantages
should not be contemplated. The question of free trade is absolutely
irrelevant, and the persistent claim made in certain quarters that all the
efforts to relieve the people from unjust and unnecessary taxation are
schemes of so-called free traders is mischievous and far removed from any
consideration for the public good.

The simple and plain duty which we owe the people is to reduce taxation to
the necessary expenses of an economical operation of the Government and to
restore to the business of the country the money which we hold in the
Treasury through the perversion of governmental powers. These things can
and should be done with safety to all our industries, without danger to the
opportunity for remunerative labor which our workingmen need, and with
benefit to them and all our people by cheapening their means of subsistence
and increasing the measure of their comforts.

The Constitution provides that the President "shall from time to time give
to the Congress information of the state of the Union." It has been the
custom of the Executive, in compliance with this provision, to annually
exhibit to the Congress, at the opening of its session, the general
condition of the country, and to detail with some particularity the
operations of the different Executive Departments. It would be especially
agreeable to follow this course at the present time and to call attention
to the valuable accomplishments of these Departments during the last fiscal
year; but I am so much impressed with the paramount importance of the
subject to which this communication has thus far been devoted that I shall
forego the addition of any other topic, and only urge upon your immediate
consideration the "state of the Union" as shown in the present condition of
our Treasury and our general fiscal situation, upon which every element of
our safety and prosperity depends.

The reports of the heads of Departments, which will be submitted, contain
full and explicit information touching the transaction of the business
intrusted to them and such recommendations relating to legislation in the
public interest as they deem advisable. I ask for these reports and
recommendations the deliberate examination and action of the legislative
branch of the Government.

There are other subjects not embraced in the departmental reports demanding
legislative consideration, and which I should be glad to submit. Some of
them, however, have been earnestly presented in previous messages, and as
to them I beg leave to repeat prior recommendations.

As the law makes no provision for any report from the Department of State,
a brief history of the transactions of that important Department, together
with other matters which it may hereafter be deemed essential to commend to
the attention of the Congress, may furnish the occasion for a future
communication.

***

State of the Union Address
Grover Cleveland
December 3, 1888

To the Congress of the United States:

As you assemble for the discharge of the duties you have assumed as the
representatives of a free and generous people, your meeting is marked by an
interesting and impressive incident. With the expiration of the present
session of the Congress the first century of our constitutional existence
as a nation will be completed.

Our survival for one hundred years is not sufficient to assure us that we
no longer have dangers to fear in the maintenance, with all its promised
blessings, of a government rounded upon the freedom of the people. The time
rather admonishes us to soberly inquire whether in the past we have always
closely kept in the course of safety, and whether we have before us a way
plain and clear which leads to happiness and perpetuity.

When the experiment of our Government was undertaken, the chart adopted for
our guidance was the Constitution. Departure from the lines there laid down
is failure. It is only by a strict adherence to the direction they indicate
and by restraint within the limitations they fix that we can furnish proof
to the world of the fitness of the American people for self-government.

The equal and exact justice of which we boast as the underlying principle
of our institutions should not be confined to the relations of our citizens
to each other. The Government itself is under bond to the American people
that in the exercise of its functions and powers it will deal with the body
of our citizens in a manner scrupulously honest and fair and absolutely
just. It has agreed that American citizenship shall be the only credential
necessary to justify the claim of equality before the law, and that no
condition in life shall give rise to discrimination in the treatment of the
people by their Government.

The citizen of our Republic in its early days rigidly insisted upon full
compliance with the letter of this bond, and saw stretching out before him
a clear field for individual endeavor. His tribute to the support of his
Government was measured by the cost of its economical maintenance, and he
was secure in the enjoyment of the remaining recompense of his steady and
contented toil. In those days the frugality of the people was stamped upon
their Government, and was enforced by the free, thoughtful, and intelligent
suffrage of the citizen. Combinations, monopolies, and aggregations of
capital were either avoided or sternly regulated and restrained. The pomp
and glitter of governments less free offered no temptation and presented no
delusion to the plain people who, side by side, in friendly competition,
wrought for the ennoblement and dignity of man, for the solution of the
problem of free government, and for the achievement of the grand destiny
awaiting the land which God had given them.

A century has passed. Our cities are the abiding places of wealth and
luxury; our manufactories yield fortunes never dreamed of by the fathers of
the Republic; our business men are madly striving in the race for riches,
and immense aggregations of capital outrun the imagination in the magnitude
of their undertakings.

We view with pride and satisfaction this bright picture of our country's
growth and prosperity, while only a closer scrutiny develops a somber
shading. Upon more careful inspection we find the wealth and luxury of our
cities mingled with poverty and wretchedness and unremunerative toil. A
crowded and constantly increasing urban population suggests the
impoverishment of rural sections and discontent with agricultural pursuits.
The farmer's son, not satisfied with his father's simple and laborious
life, joins the eager chase for easily acquired wealth.

We discover that the fortunes realized by our manufacturers are no longer
solely the reward of sturdy industry and enlightened foresight, but that
they result from the discriminating favor of the Government and are largely
built upon undue exactions from the masses of our people. The gulf between
employers and the employed is constantly widening, and classes are rapidly
forming, one comprising the very rich and powerful, while in another are
found the toiling poor.

As we view the achievements of aggregated capital, we discover the
existence of trusts, combinations, and monopolies, while the citizen is
struggling far in the rear or is trampled to death beneath an iron heel.
Corporations, which should be the carefully restrained creatures of the law
and the servants of the people, are fast becoming the people's masters.

Still congratulating ourselves upon the wealth and prosperity of our
country and complacently contemplating every incident of change inseparable
from these conditions, it is our duty as patriotic citizens to inquire at
the present stage of our progress how the bond of the Government made with
the people has been kept and performed.

Instead of limiting the tribute drawn from our citizens to the necessities
of its economical administration, the Government persists in exacting from
the substance of the people millions which, unapplied and useless, lie
dormant in its Treasury. This flagrant injustice and this breach of faith
and obligation add to extortion the danger attending the diversion of the
currency of the country from the legitimate channels of business.

Under the same laws by which these results are produced the Government
permits many millions more to be added to the cost of the living of our
people and to be taken from our consumers, which unreasonably swell the
profits of a small but powerful minority.

The people must still be taxed for the support of the Government under the
operation of tariff laws. But to the extent that the mass of our citizens
are inordinately burdened beyond any useful public purpose and for the
benefit of a favored few, the Government, under pretext of an exercise of
its taxing power, enters gratuitously into partnership with these
favorites, to their advantage and to the injury of a vast majority of our
people.

This is not equality before the law.

The existing situation is injurious to the health of our entire body
politic. It stifles in those for whose benefit it is permitted all
patriotic love of country, and substitutes in its place selfish greed and
grasping avarice. Devotion to American citizenship for its own sake and for
what it should accomplish as a motive to our nation's advancement and the
happiness of all our people is displaced by the assumption that the
Government, instead of being the embodiment of equality, is but an
instrumentality through which especial and individual advantages are to be
gained.

The arrogance of this assumption is unconcealed. It appears in the sordid
disregard of all but personal interests, in the refusal to abate for the
benefit of others one iota of selfish advantage, and in combinations to
perpetuate such advantages through efforts to control legislation and
improperly influence the suffrages of the people.

The grievances of those not included within the circle of these
beneficiaries, when fully realized, will surely arouse irritation and
discontent. Our farmers, long suffering and patient, struggling in the race
of life with the hardest and most unremitting toil, will not fail to see,
in spite of misrepresentations and misleading fallacies, that they are
obliged to accept such prices for their products as are fixed in foreign
markets where they compete with the farmers of the world; that their lands
are declining in value while their debts increase, and that without
compensating favor they are forced by the action of the Government to pay
for the benefit of others such enhanced prices for the things they need
that the scanty returns of their labor fail to furnish their support or
leave no margin for accumulation.

Our workingmen, enfranchised from all delusions and no longer frightened by
the cry that their wages are endangered by a just revision of our tariff
laws, will reasonably demand through such revision steadier employment,
cheaper means of living in their homes, freedom for themselves and their
children from the doom of perpetual servitude, and an open door to their
advancement beyond the limits of a laboring class. Others of our citizens,
whose comforts and expenditures are measured by moderate salaries and fixed
incomes, will insist upon the fairness and justice of cheapening the cost
of necessaries for themselves and their families.

When to the selfishness of the beneficiaries of unjust discrimination under
our laws there shall be added the discontent of those who suffer from such
discrimination, we will realize the fact that the beneficent purposes of
our Government, dependent upon the patriotism and contentment of our
people, are endangered.

Communism is a hateful thing and a menace to peace and organized
government; but the communism of combined wealth and capital, the outgrowth
of overweening cupidity and selfishness, which insidiously undermines the
justice and integrity of free institutions, is not less dangerous than the
communism of oppressed poverty and toil, which, exasperated by injustice
and discontent, attacks with wild disorder the citadel of rule.

He mocks the people who proposes that the Government shall protect the rich
and that they in turn will care for the laboring poor. Any intermediary
between the people and their Government or the least delegation of the care
and protection the Government owes to the humblest citizen in the land
makes the boast of free institutions a glittering delusion and the
pretended boon of American citizenship a shameless imposition.

A just and sensible revision of our tariff laws should be made for the
relief of those of our countrymen who suffer under present conditions. Such
a revision should receive the support of all who love that justice and
equality due to American citizenship; of all who realize that in this
justice and equality our Government finds its strength and its power to
protect the citizen and his property; of all who believe that the contented
competence and comfort of many accord better with the spirit of our
institutions than colossal fortunes unfairly gathered in the hands of a
few; of all who appreciate that the forbearance and fraternity among our
people, which recognize the value of every American interest, are the
surest guaranty of our national progress, and of all who desire to see the
products of American skill and ingenuity in every market of the world, with
a resulting restoration of American commerce.

The necessity of the reduction of our revenues is so apparent as to be
generally conceded, but the means by which this end shall be accomplished
and the sum of direct benefit which shall result to our citizens present a
controversy of the utmost importance. There should be no scheme accepted as
satisfactory by which the burdens of the people are only apparently
removed. Extravagant appropriations of public money, with all their
demoralizing consequences, should not be tolerated, either as a means of
relieving the Treasury of its present surplus or as furnishing pretext for
resisting a proper reduction in tariff rates. Existing evils and injustice
should be honestly recognized, boldly met, and effectively remedied. There
should be no cessation of the struggle until a plan is perfected, fair and
conservative toward existing industries, but which will reduce the cost to
consumers of the necessaries of life, while it provides for our
manufacturers the advantage of freer raw materials and permits no injury to
the interests of American labor.

The cause for which the battle is waged is comprised within lines clearly
and distinctly defined. It should never be compromised. It is the people's
cause.

It can not be denied that the selfish and private interests which are so
persistently heard when efforts are made to deal in a just and
comprehensive manner with our tariff laws are related to, if they are not
responsible for, the sentiment largely prevailing among the people that the
General Government is the fountain of individual and private aid; that it
may be expected to relieve with paternal care the distress of citizens and
communities, and that from the fullness of its Treasury it should, upon the
slightest possible pretext of promoting the general good, apply public
funds to the benefit of localities and individuals. Nor can it be denied
that there is a growing assumption that, as against the Government and in
favor of private claims and interests, the usual rules and limitations of
business principles and just dealing should be waived.

These ideas have been unhappily much encouraged by legislative
acquiescence. Relief from contracts made with the Government is too easily
accorded in favor of the citizen; the failure to support claims against the
Government by proof is often supplied by no better consideration than the
wealth of the Government and the poverty of the claimant; gratuities in the
form of pensions are granted upon no other real ground than the needy
condition of the applicant, or for reasons less valid; and large sums are
expended for public buildings and other improvements upon representations
scarcely claimed to be related to public needs and necessities.

The extent to which the consideration of such matters subordinate and
postpone action upon subjects of great public importance, but involving no
special private or partisan interest, should arrest attention and lead to
reformation.

A few of the numerous illustrations of this condition may be stated.

The crowded condition of the calendar of the Supreme Court, and the delay
to suitors and denial of justice resulting therefrom, has been strongly
urged upon the attention of the Congress, with a plan for the relief of the
situation approved by those well able to judge of its merits. While this
subject remains without effective consideration, many laws have been passed
providing for the holding of terms of inferior courts at places to suit the
convenience of localities, or to lay the foundation of an application for
the erection of a new public building.

Repeated recommendations have been submitted for the amendment and change
of the laws relating to our public lands so that their spoliation and
diversion to other uses than as homes for honest settlers might be
prevented. While a measure to meet this conceded necessity of reform
remains awaiting the action of the Congress, many claims to the public
lands and applications for their donation, in favor of States and
individuals, have been allowed.

A plan in aid of Indian management, recommended by those well informed as
containing valuable features in furtherance of the solution of the Indian
problem, has thus far failed of legislative sanction, while grants of
doubtful expediency to railroad corporations, permitting them to pass
through Indian reservations, have greatly multiplied.

The propriety and necessity of the erection of one or more prisons for the
confinement of United States convicts, and a post-office building in the
national capital, are not disputed. But these needs yet remain answered,
while scores of public buildings have been erected where their necessity
for public purposes is not apparent.

A revision of our pension laws could easily be made which would rest upon
just principles and provide for every worthy applicant. But while our
general pension laws remain confused and imperfect, hundreds of private
pension laws are annually passed, which are the sources of unjust
discrimination and popular demoralization.

Appropriation bills for the support of the Government are defaced by items
and provisions to meet private ends, and it is freely asserted by
responsible and experienced parties that a bill appropriating money for
public internal improvement would fail to meet with favor unless it
contained items more for local and private advantage than for public
benefit.

These statements can be much emphasized by an ascertainment of the
proportion of Federal legislation which either bears upon its face its
private character or which upon examination develops such a motive power.

And yet the people wait and expect from their chosen representatives such
patriotic action as will advance the welfare of the entire country; and
this expectation can only be answered by the performance of public duty
with unselfish purpose. Our mission among the nations of the earth and our
success in accomplishing the work God has given the American people to do
require of those intrusted with the making and execution of our laws
perfect devotion, above all other things, to the public good.

This devotion will lead us to strongly resist all impatience of
constitutional limitations of Federal power and to persistently check the
increasing tendency to extend the scope of Federal legislation into the
domain of State and local jurisdiction upon the plea of subserving the
public welfare. The preservation of the partitions between proper subjects
of Federal and local care and regulation is of such importance under the
Constitution, which is the law of our very existence, that no consideration
of expediency or sentiment should tempt us to enter upon doubtful ground.
We have undertaken to discover and proclaim the richest blessings of a free
government, with the Constitution as our guide. Let us follow the way it
points out; it will not mislead us. And surely no one who has taken upon
himself the solemn obligation to support and preserve the Constitution can
find justification or solace for disloyalty in the excuse that he wandered
and disobeyed in search of a better way to reach the public welfare than
the Constitution offers.

What has been said is deemed not inappropriate at a time when, from a
century's height, we view the way already trod by the American people and
attempt to discover their future path.

The seventh President of the United States--the soldier and statesman and
at all times the firm and brave friend of the people--in vindication of his
course as the protector of popular rights and the champion of true American
citizenship, declared: The ambition which leads me on is an anxious desire
and a fixed determination to restore to the people unimpaired the sacred
trust they have confided to my charge; to, heal the wounds of the
Constitution and to preserve it from further violation; to persuade my
countrymen, so far as I may, that it is not in a splendid government
supported by powerful monopolies and aristocratical establishments that
they will find happiness or their liberties protection, but in a plain
system, void of pomp, protecting all and granting favors to none,
dispensing its blessings like the dews of heaven, unseen and unfelt save in
the freshness and beauty they contribute to produce. It is such a
government that the genius of our people requires--such an one only under
which our States may remain for ages to come united, prosperous, and free.
In pursuance of a constitutional provision requiring the President from
time to time to give to the Congress information of the state of the Union,
I have the satisfaction to announce that the close of the year finds the
United States in the enjoyment of domestic tranquillity and at peace with
all the nations.

Since my last annual message our foreign relations have been strengthened
and improved by performance of international good offices and by new and
renewed treaties of amity, commerce, and reciprocal extradition of
criminals.

Those international questions which still await settlement are all
reasonably within the domain of amicable negotiation, and there is no
existing subject of dispute between the United States and any foreign power
that is not susceptible of satisfactory adjustment by frank diplomatic
treatment.

The questions between Great Britain and the United States relating to the
rights of American fishermen, under treaty and international comity, in the
territorial waters of Canada and Newfoundland, I regret to say, are not yet
satisfactorily adjusted.

These matters were fully treated in my message to the Senate of February 20
1888, together with which a convention, concluded under my authority with
Her Majesty's Government on the 15th of February last, for the removal of
all causes of misunderstanding, was submitted by me for the approval of the
Senate.

This treaty having been rejected by the Senate, I transmitted a message to
the Congress on the 23d of August last reviewing the transactions and
submitting for consideration certain recommendations for legislation
concerning the important questions involved.

Afterwards, on the 12th of September, in response to a resolution of the
Senate, I again communicated fully all the information in my possession as
to the action of the government of Canada affecting the commercial
relations between the Dominion and the United States, including the
treatment of American fishing vessels in the ports and waters of British
North America.

These communications have all been published, and therefore opened to the
knowledge of both Houses of Congress, although two were addressed to the
Senate alone.

Comment upon or repetition of their contents would be superfluous, and I am
not aware that anything has since occurred which should be added to the
facts therein stated. Therefore I merely repeat, as applicable to the
present time, the statement which will be found in my message to the Senate
of September 12 last, that--Since March 3, 1887, no case has been reported
to the Department of State wherein complaint was made of unfriendly or
unlawful treatment of American fishing vessels on the part of the Canadian
authorities in which reparation was not promptly and satisfactorily
obtained by the United States consul-general at Halifax. Having essayed in
the discharge of my duty to procure by negotiation the settlement of a
long-standing cause of dispute and to remove a constant menace to the good
relations of the two countries, and continuing to be of opinion that the
treaty of February last, which failed to receive the approval of the
Senate, did supply "a satisfactory, practical, and final adjustment, upon a
basis honorable and just to both parties, of the difficult and vexed
question to which it related," and having subsequently and unavailingly
recommended other legislation to Congress which I hoped would suffice to
meet the exigency created by the rejection of the treaty, I now again
invoke the earnest and immediate attention of the Congress to the condition
of this important question as it now stands before them and the country,
and for the settlement of which I am deeply solicitous.

Near the close of the month of October last occurrences of a deeply
regrettable nature were brought to my knowledge, which made it my painful
but imperative duty to obtain with as little delay as possible a new
personal channel of diplomatic intercourse in this country with the
Government of Great Britain.

The correspondence in relation to this incident will in due course be laid
before you, and will disclose the unpardonable conduct of the official
referred to in his interference by advice and counsel with the suffrages of
American citizens in the very crisis of the Presidential election then near
at hand, and also in his subsequent public declarations to justify his
action, superadding impugnment of the Executive and Senate of the United
States in connection with important questions now pending in controversy
between the two Governments.

The offense thus committed was most grave, involving disastrous
possibilities to the good relations of the United States and Great Britain,
constituting a gross breach of diplomatic privilege and an invasion of the
purely domestic affairs and essential sovereignty of the Government to
which the envoy was accredited.

Having first fulfilled the just demands of international comity by
affording full opportunity for Her Majesty's Government to act in relief of
the situation, I considered prolongation of discussion to be unwarranted,
and thereupon declined to further recognize the diplomatic character of the
person whose continuance in such function would destroy that mutual
confidence which is essential to the good understanding of the two
Governments and was inconsistent with the welfare and self-respect of the
Government of the United States.

The usual interchange of communication has since continued through Her
Majesty's legation in this city.

My endeavors to establish by international cooperation measures for the
prevention of the extermination of fur seals in Bering Sea have not been
relaxed, and I have hopes of being enabled shortly to submit an effective
and satisfactory conventional projet with the maritime powers for the
approval of the Senate.

The coastal boundary between our Alaskan possessions and British Columbia,
I regret to say, has not received the attention demanded by its importance,
and which on several occasions heretofore I have had the honor to recommend
to the Congress.

The admitted impracticability, if not impossibility, of making an accurate
and precise survey and demarcation of the boundary line as it is recited in
the treaty with Russia under which Alaska was ceded to the United States
renders it absolutely requisite for the prevention of international
jurisdictional complications that adequate appropriation for a
reconnoissance and survey to obtain proper knowledge of the locality and
the geographical features of the boundary should be authorized by Congress
with as little delay as possible.

Knowledge to be only thus obtained is an essential prerequisite for
negotiation for ascertaining a common boundary, or as preliminary to any
other mode of settlement.

It is much to be desired that some agreement should be reached with Her
Majesty's Government by which the damages to life and property on the Great
Lakes may be alleviated by removing or humanely regulating the obstacles to
reciprocal assistance to wrecked or stranded vessels.

The act of June 19, 1878, which offers to Canadian vessels free access to
our inland waters in aid of wrecked or disabled vessels, has not yet become
effective through concurrent action by Canada.

The due protection of our citizens of French origin or descent from claim
of military service in the event of their returning to or visiting France
has called forth correspondence which was laid before you at the last
session.

In the absence of conventional agreement as to naturalization, which is
greatly to be desired, this Government sees no occasion to recede from the
sound position it has maintained not only with regard to France, but as to
all countries with which the United States have not concluded special
treaties.

Twice within the last year has the imperial household of Germany been
visited by death; and I have hastened to express the sorrow of this people,
and their appreciation of the lofty character of the late aged Emperor
William, and their sympathy with the heroism under suffering of his son the
late Emperor Frederick.

I renew my recommendation of two years ago for the passage of a bill for
the refunding to certain German steamship lines of the interest upon
tonnage dues illegally exacted.

On the 12th [2d] of April last I laid before the House of Representatives
full information respecting our interests in Samoa; and in the subsequent
correspondence on the same subject, which will be laid before you in due
course, the history of events in those islands will be found.

In a message accompanying my approval, on the 1st day of October last, of a
bill for the exclusion of Chinese laborers, I laid before Congress full
information and all correspondence touching the negotiation of the treaty
with China concluded at this capital on the 12th day of March, 1888, and
which, having been confirmed by the Senate with certain amendments, was
rejected by the Chinese Government. This message contained a recommendation
that a sum of money be appropriated as compensation to Chinese subjects who
had suffered injuries at the hands of lawless men within our jurisdiction.
Such appropriation having been duly made, the fund awaits reception by the
Chinese Government.

It is sincerely hoped that by the cessation of the influx of this class of
Chinese subjects, in accordance with the expressed wish of both
Governments, a cause of unkind feeling has been permanently removed.

On the 9th of August, 1887, notification was given by the Japanese minister
at this capital of the adjournment of the conference for the revision of
the treaties of Japan with foreign powers, owing to the objection of his
Government to the provision in the draft jurisdictional convention which
required the submission of the criminal code of the Empire to the powers in
advance of its becoming operative. This notification was, however,
accompanied with an assurance of Japan's intention to continue the work of
revision.

Notwithstanding this temporary interruption of negotiations, it is hoped
that improvements may soon be secured in the jurisdictional system as
respects foreigners in Japan, and relief afforded to that country from the
present undue and oppressive foreign control in matters of commerce.

I earnestly recommend that relief be provided for the injuries accidentally
caused to Japanese subjects in the island Ikisima by the target practice of
one of our vessels.

A diplomatic mission from Korea has been received, and the formal
intercourse between the two countries contemplated by the treaty of 1882 is
now established.

Legislative provision is hereby recommended to organize and equip consular
courts in Korea.

Persia has established diplomatic representation at this capital, and has
evinced very great interest in the enterprise and achievements of our
citizens. I am therefore hopeful that beneficial commercial relations
between the two countries may be brought about.

I announce with sincere regret that Hayti has again become the theater of
insurrection, disorder, and bloodshed. The titular government of president
Saloman has been forcibly overthrown and he driven out of the country to
France, where he has since died.

The tenure of power has been so unstable amid the war of factions that has
ensued since the expulsion of President Saloman that no government
constituted by the will of the Haytian people has been recognized as
administering responsibly the affairs of that country. Our representative
has been instructed to abstain from interference between the warring
factions, and a vessel of our Navy has been sent to Haytian waters to
sustain our minister and for the protection of the persons and property of
American citizens.

Due precautions have been taken to enforce our neutrality laws and prevent
our territory from becoming the base of military supplies for either of the
warring factions.

Under color of a blockade, of which no reasonable notice had been given,
and which does not appear to have been efficiently maintained, a seizure of
vessels under the American flag has been reported, and in consequence
measures to prevent and redress any molestation of our innocent merchantmen
have been adopted.

Proclamation was duly made on the 9th day of November, 1887, of the
conventional extensions of the treaty of June 3, 1875, with Hawaii, under
which relations of such special and beneficent intercourse have been
created.

In the vast field of Oriental commerce now unfolded from our Pacific
borders no feature presents stronger recommendations for Congressional
action than the establishment of communication by submarine telegraph with
Honolulu.

The geographical position of the Hawaiian group in relation to our Pacific
States creates a natural interdependency and mutuality of interest which
our present treaties were intended to foster, and which make close
communication a logical and commercial necessity.

The wisdom of concluding a treaty of commercial reciprocity with Mexico has
been heretofore stated in my messages to Congress, and the lapse of time
and growth of commerce with that close neighbor and sister Republic confirm
the judgment so expressed.

The precise relocation of our boundary line is needful, and adequate
appropriation is now recommended.

It is with sincere satisfaction that I am enabled to advert to the spirit
of good neighborhood and friendly cooperation and conciliation that has
marked the correspondence and action of the Mexican authorities in their
share of the task of maintaining law and order about the line of our common
boundary.

The long-pending boundary dispute between Costa Rica and Nicaragua was
referred to my arbitration, and by an award made on the 22d of March last
the question has been finally settled to the expressed satisfaction of both
of the parties in interest.

The Empire of Brazil, in abolishing the last vestige of slavery among
Christian nations, called forth the earnest congratulations of this
Government in expression of the cordial sympathies of our people.

The claims of nearly all other countries against Chile growing out of her
late war with Bolivia and Peru have been disposed of, either by arbitration
or by a lump settlement. Similar claims of our citizens will continue to be
urged upon the Chilean Government, and it is hoped will not be subject to
further delays.

A comprehensive treaty of amity and commerce with Peru was proclaimed on
November 7 last, and it is expected that under its operation mutual
prosperity and good understanding will be promoted.

In pursuance of the policy of arbitration, a treaty to settle the claim of
Santos, an American citizen, against Ecuador has been concluded under my
authority, and will be duly submitted for the approval of the Senate.

Like disposition of the claim of Carlos Butterfield against Denmark and of
Van Bokkelen against Hayti will probably be made, and I trust the principle
of such settlements may be extended in practice under the approval of the
Senate.

Through unforeseen causes, foreign to the will of both Governments, the
ratification of the convention of December 5, 1885, with Venezuela, for the
rehearing of claims of citizens of the United States under the treaty of
1866, failed of exchange within the term provided, and a supplementary
convention, further extending the time for exchange of ratifications and
explanatory of an ambiguous provision of the prior convention, now awaits
the advice and consent of the Senate.

Although this matter, in the stage referred to, concerns only the
concurrent treaty-making power of one branch of Congress, I advert to it in
view of the interest repeatedly and conspicuously shown by you in your
legislative capacity in favor of a speedy and equitable adjustment of the
questions growing out of the discredited judgments of the previous mixed
commission of Caracas. With every desire to do justice to the
representations of Venezuela in this regard, the time seems to have come to
end this matter, and I trust the prompt confirmation by both parties of the
supplementary action referred to will avert the need of legislative or
other action to prevent the longer withholding of such rights of actual
claimants as may be shown to exist.

As authorized by the Congress, preliminary steps have been taken for the
assemblage at this capital during the coming year of the representatives of
South and Central American States, together with those of Mexico, Hayti,
and San Domingo, to discuss sundry important monetary and commercial
topics.

Excepting in those cases where, from reasons of contiguity of territory and
the existence of a common border line incapable of being guarded,
reciprocal commercial treaties may be found expedient, it is believed that
commercial policies inducing freer mutual exchange of products can be most
advantageously arranged by independent but cooperative legislation.

In the mode last mentioned the control of our taxation for revenue will be
always retained in our own hands unrestricted by conventional agreements
with other governments.

In conformity also with Congressional authority, the maritime powers have
been invited to confer in Washington in April next upon the practicability
of devising uniform rules and measures for the greater security of life and
property at sea. A disposition to accept on the part of a number of the
powers has already been manifested, and if the cooperation of the nations
chiefly interested shall be secured important results may be confidently
anticipated.

The act of June 26, 1884, and the acts amendatory thereof, in relation to
tonnage duties, have given rise to extended correspondence with foreign
nations with whom we have existing treaties of navigation and commerce, and
have caused wide and regrettable divergence of opinion in relation to the
imposition of the duties referred to. These questions are important, and I
shall make them the subject of a special and more detailed communication at
the present session.

With the rapid increase of immigration to our shores and the facilities of
modern travel, abuses of the generous privileges afforded by our
naturalization laws call for their careful revision.

The easy and unguarded manner in which certificates of American citizenship
can now be obtained has induced a class, unfortunately large, to avail
themselves of the opportunity to become absolved from allegiance to their
native land, and yet by a foreign residence to escape any just duty and
contribution of service to the country of their proposed adoption. Thus,
while evading the duties of citizenship to the United States, they may make
prompt claim for its national protection and demand its intervention in
their behalf. International complications of a serious nature arise, and
the correspondence of the State Department discloses the great number and
complexity of the questions which have been raised.

Our laws regulating the issue of passports should be carefully revised, and
the institution of a central bureau of registration at the capital is again
strongly recommended. By this means full particulars of each case of
naturalization in the United States would be secured and properly indexed
and recorded, and thus many cases of spurious citizenship would be detected
and unjust responsibilities would be avoided.

The reorganization of the consular service is a matter of serious
importance to our national interests. The number of existing principal
consular offices is believed to be greater than is at all necessary for the
conduct of the public business. It need not be our policy to maintain more
than a moderate number of principal offices, each supported by a salary
sufficient to enable the incumbent to live in comfort, and so distributed
as to secure the convenient supervision, through subordinate agencies, of
affairs over a considerable district.

I repeat the recommendations heretofore made by me that the appropriations
for the maintenance of our diplomatic and consular service should be
recast; that the so-called notarial or unofficial fees, which our
representatives abroad are now permitted to treat as personal perquisites,
should be forbidden; that a system of consular inspection should be
instituted, and that a limited number of secretaries of legation at large
should be authorized.

Preparations for the centennial celebration, on April 30, 1889, of the
inauguration of George Washington as President of the United States, at the
city of New York, have been made by a voluntary organization of the
citizens of that locality, and believing that an opportunity should be
afforded for the expression of the interest felt throughout the country in
this event, I respectfully recommend fitting and cooperative action by
Congress on behalf of the people of the United States.

The report of the Secretary of the Treasury exhibits in detail the
condition of our national finances and the operations of the several
branches of the Government related to his Department.

The total ordinary revenues of the Government for the fiscal year ended
June 30, 1888, amounted to $379,266,074.76, of which $219,091,173.63 was
received from customs duties and $124,296,871.98 from internal revenue
taxes.

The total receipts from all sources exceeded those for the fiscal year
ended June 30, 1887, by $7,862,797.10.

The ordinary expenditures of the Government for the fiscal year ending June
30, 1888, were $259,653,958.67, leaving a surplus of $119,612,116.09.

The decrease in these expenditures as compared with the fiscal year ended
June 30, 1887, was $8,278,221.30, notwithstanding the payment of more than
$5,000,000 for pensions in excess of what was paid for that purpose in the
latter-mentioned year.

The revenues of the Government for the year ending June 30, 1889,
ascertained for the quarter ended September 30, 1888, and estimated for the
remainder of the time, amount to $377,000,000, and the actual and estimated
ordinary expenditures for the same year are $273,000,000, leaving an
estimated surplus of $104,000,000.

The estimated receipts for the year ending June 30, 1890, are $377,000,000,
and the estimated ordinary expenditures for the same time are
$275,767,488.34, showing a surplus of $101,232,511.66.

The foregoing statements of surplus do not take into account the sum
necessary to be expended to meet the requirements of the sinking-fund act,
amounting to more than $47,000,000 annually.

The cost of collecting the customs revenues for the last fiscal year was
2.44 per cent; for the year 1885 it was 3.77 per cent.

The excess of internal-revenue taxes collected during the last fiscal year
over those collected for the year ended June 30, 1887, was $5,489,174.26,
and the cost of collecting this revenue decreased from 3.4 per cent in 1887
to less than 3.2 per cent for the last year. The tax collected on
oleomargarine was $723,948.04 for the year ending June 30, 1887, and
$864,139.88 for the following year.

The requirements of the sinking-fund act have been met for the year ended
June 30, 1888, and for the current year also, by the purchase of bonds.
After complying with this law as positively required, and bonds sufficient
for that purpose had been bought at a premium, it was not deemed prudent to
further expend the surplus in such purchases until the authority to do so
should be more explicit. A resolution, however, having been passed by both
Houses of Congress removing all doubt as to Executive authority, daily
purchases of bonds were commenced on the 23d day of April, 1888, and have
continued until the present time. By this plan bonds of the Government not
yet due have been purchased up to and including the 30th day of November,
1888, amounting to $94,700,400, the premium paid thereon amounting to
$17,508,613.08.

The premium added to the principal of these bonds represents an investment
yielding about 2 per cent interest for the time they still had to run, and
the saving to the Government represented by the difference between the
amount of interest at 2 per cent upon the sum paid for principal and
premium and what it would have paid for interest at the rate specified in
the bonds if they had run to their maturity is about $27,165,000.

At first sight this would seem to be a profitable and sensible transaction
on the part of the Government, but, as suggested by the Secretary of the
Treasury, the surplus thus expended for the purchase of bonds was money
drawn from the people in excess of any actual need of the Government and
was so expended rather than allow it to remain idle in the Treasury. If
this surplus, under the operation of just and equitable laws, had been left
in the hands of the people, it would have been worth in their business at
least 6 per cent per annum. Deducting from the amount of interest upon the
principal and premium of these bonds for the time they had to run at the
rate of 6 per cent the saving of 2 per cent made for the people by the
purchase of such bonds, the loss will appear to be $55,760,000.

This calculation would seem to demonstrate that if excessive and
unnecessary taxation is continued and the Government is forced to pursue
this policy of purchasing its own bonds at the premiums which it will be
necessary to pay, the loss to the people will be hundreds of millions of
dollars.

Since the purchase of bonds was undertaken as mentioned nearly all that
have been offered were at last accepted. It has been made quite apparent
that the Government was in danger of being subjected to combinations to
raise their price, as appears by the instance cited by the Secretary of the
offering of bonds of the par value of only $326,000 so often that the
aggregate of the sums demanded for their purchase amounted to more than $
19,700,000.

Notwithstanding the large sums paid out in the purchase of bonds, the
surplus in the Treasury on the 30th day of November, 1888, was
$52,234,610.01, after deducting about $20,000,000 just drawn out for the
payment of pensions.

At the close of the fiscal year ended June 30, 1887, there had been coined
under the compulsory silver-coinage act $266,988,280 in silver dollars,
$55,504,310 of which were in the hands of the people.

On the 30th day of June, 1888, there had been coined $299,708,790; and of
this $55,829,303 was in circulation in coin, and $200,387,376 in silver
certificates, for the redemption of which silver dollars to that amount
were held by the Government.

On the 30th day of November, 1888, $312,570,990 had been coined,
$60,970,990 of the silver dollars were actually in circulation, and
$237,418,346 in certificates.

The Secretary recommends the suspension of the further coinage of silver,
and in such recommendation I earnestly concur.

For further valuable information and timely recommendations I ask the
careful attention of the Congress to the Secretary's report.

The Secretary of War reports that the Army at the date of the last
consolidated returns consisted of 2,189 officers and 24,549 enlisted men.

The actual expenditures of the War Department for the fiscal year ended
June 30, 1888, amounted to $41,165,107.07, of which sum $9,158,516.63 was
expended for public works, including river and harbor improvements.

"The Board of Ordnance and Fortifications" provided for under the act
approved September 22 last was convened October 30, 1888, and plans and
specifications for procuring forgings for 8, 10, and 12 inch guns, under
provisions of section 4, and also for procuring 12-inch breech-loading
mortars, cast iron, hooped with steel, under the provisions of section 5 of
the said act, were submitted to the Secretary of War for reference to the
board, by the Ordnance Department, on the same date.

These plans and specifications having been promptly approved by the board
and the Secretary of War, the necessary authority to publish advertisements
inviting proposals in the newspapers throughout the country was granted by
the Secretary on November 12, and on November 13 the advertisements were
sent out to the different newspapers designated. The bids for the steel
forgings are to be opened on December 20, 1888, and for the mortars on
December 15, 1888.

A board of ordnance officers was convened at the Watervliet Arsenal on
October 4, 1888, to prepare the necessary plans and specifications for the
establishment of an army gun factory at that point. The preliminary report
of this board, with estimates for shop buildings and officers' quarters,
was approved by the Board of Ordnance and Fortifications November 6 and 8.
The specifications and form of advertisement and instructions to bidders
have been prepared, and advertisements inviting proposals for the
excavations for the shop building and for erecting the two sets of
officers' quarters have been published. The detailed drawings and
specifications for the gun-factory building are well in hand, and will be
finished within three or four months, when bids will be invited for the
erection of the building. The list of machines, etc., is made out, and it
is expected that the plans for the large lathes, etc., will be completed
within about four months, and after approval by the Board of Ordnance and
Fortifications bids for furnishing the same will be invited. The machines
and other fixtures will be completed as soon as the shop is in readiness to
receive them, probably about July, 1890.

Under the provisions of the Army bill for the procurement of pneumatic
dynamite guns, the necessary specifications are now being prepared, and
advertisements for proposals will issue early in December. The guns will
probably be of 15 inches caliber and fire a projectile that will carry a
charge each of about 500 pounds of explosive gelatine with full-caliber
projectiles. The guns will probably be delivered in from six to ten months
from the date of the contract, so that all the guns of this class that can
be procured under the provisions of the law will be purchased during the
year 1889.

I earnestly request that the recommendations contained in the Secretary's
report, all of which are, in my opinion, calculated to increase the
usefulness and discipline of the Army, may receive the consideration of the
Congress. Among these the proposal that there should be provided a plan for
the examination of officers to test their fitness for promotion is of the
utmost importance. This reform has been before recommended in the reports
of the Secretary, and its expediency is so fully demonstrated by the
argument he presents in its favor that its adoption should no longer be
neglected.

The death of General Sheridan in August last was a national affliction. The
Army then lost the grandest of its chiefs. The country lost a brave and
experienced soldier, a wise and discreet counselor, and a modest and
sensible man. Those who in any manner came within the range of his personal
association will never fail to pay deserved and willing homage to his
greatness and the glory of his career, but they will cherish with more
tender sensibility the loving memory of his simple, generous, and
considerate nature.

The Apache Indians, whose removal from their reservation in Arizona
followed the capture of those of their number who engaged in a bloody
and murderous raid during a part of the years 1885 and 1886, are now held
as prisoners of war at Mount Vernon Barracks, in the State of Alabama. They
numbered on the 31st day of October, the date of the last report, 83 men,
170 women, 70 boys, and 59 girls; in all, 382 persons. The commanding
officer states that they are in good health and contented, and that they
are kept employed as fully as is possible in the circumstances. The
children, as they arrive at a suitable age, are sent to the Indian schools
at Carlisle and Hampton.

Last summer some charitable and kind people asked permission to send two
teachers to these Indians for the purpose of instructing the adults as well
as such children as should be found there. Such permission was readily
granted, accommodations were provided for the teachers, and some portions
of the buildings at the barracks were made available for school purposes.
The good work contemplated has been commenced, and the teachers engaged are
paid by the ladies with whom the plan originated.

I am not at all in sympathy with those benevolent but injudicious people
who are constantly insisting that these Indians should be returned to their
reservation. Their removal was an absolute necessity if the lives and
property of citizens upon the frontier are to be at all regarded by the
Government. Their continued restraint at a distance from the scene of their
repeated and cruel murders and outrages is still necessary. It is a
mistaken philanthropy, every way injurious, which prompts the desire to see
these savages returned to their old haunts. They are in their present
location as the result of the best judgment of those having official
responsibility in the matter, and who are by no means lacking in kind
consideration for the Indians. A number of these prisoners have forfeited
their lives to outraged law and humanity. Experience has proved that they
are dangerous and can not be trusted. This is true not only of those who on
the warpath have heretofore actually been guilty of atrocious murder, but
of their kindred and friends, who, while they remained upon their
reservation, furnished aid and comfort to those absent with bloody intent.

These prisoners should be treated kindly and kept in restraint far from the
locality of their former reservation; they should be subjected to efforts
calculated to lead to their improvement and the softening of their savage
and cruel instincts, but their return to their old home should be
persistently resisted.

The Secretary in his report gives a graphic history of these Indians, and
recites with painful vividness their bloody deeds and the unhappy failure
of the Government to manage them by peaceful means. It will be amazing if a
perusal of this history will allow the survival of a desire for the return
of these prisoners to their reservation upon sentimental or any other
grounds.

The report of the Secretary of the Navy demonstrates very intelligent
management in that important Department, and discloses the most
satisfactory progress in the work of reconstructing the Navy made during
the past year. Of the ships in course of construction five, viz, the
Charleston, Baltimore, Yorktown, Vesuvius, and the Petrel, have in that
time been launched and are rapidly approaching completion; and in addition
to the above, the Philadelphia, the San Francisco, the Newark, the
Bennington, the Concord, and the Herreshoff torpedo boat are all under
contract for delivery to the Department during the next year. The progress
already made and being made gives good ground for the expectation that
these eleven vessels will be incorporated as part of the American Navy
within the next twelve months.

The report shows that notwithstanding the large expenditures for new
construction and the additional labor they involve the total ordinary or
current expenditures of the Department for the three years ending June 30,
1888, are less by more than 20 per cent than such expenditures for the
three years ending June 30, 1884.

The various steps which have been taken to improve the business methods of
the Department are reviewed by the Secretary. The purchasing of supplies
has been consolidated and placed under a responsible bureau head. This has
resulted in the curtailment of open purchases, which in the years 1884 and
1885 amounted to over 50 per cent of all the purchases of the Department,
to less than 11 per cent; so that at the present time about 90 per cent of
the total departmental purchases are made by contract and after
competition. As the expenditures on this account exceed an average of
$2,000,000 annually, it is evident that an important improvement in the
system has been inaugurated and substantial economies introduced.

The report of the Postmaster-General shows a marked increase of business in
every branch of the postal service.

The number of post-offices on July 1, 1888, was 57,376, an increase of
6,124 in three years and of 2,219 for the last fiscal year. The
latter-mentioned increase is classified as follows:

New England States -

Middle States - 181

Southern States and Indian Territory (41) - 1,406

The States and Territories of the Pacific Coast - 190

The ten States and Territories of the West and Northwest - 435

District of Columbia - 2





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