"9.5"“. M
. W3." ..
duty ‘idf makihzla'n's for a-g‘e‘nerou‘sf»,
"free-people impressively suggests thegiieil
acting'o'blig‘ation and 'i nexdrablefresponsi- ..
bility ihvclvedflin their task.” Attli‘e thresh~"
' ,4 hidpf such labor now'to' boundertaken by
. fthesfcong'ress of'_ the United States and in
the discharge of an executive duty en-
"joined by the constitution I so ' it, 'this
communication. containing a briefjstate-
ment of the condition of our national af-
fairs and recommending such legislation
as seems to me necessary and expedient. --
The history of our recent dealings with
other nations, and our peaceful relations
with them at this time, additionally dem-
onstrate the advantage of consistently ad-
hering to a firmbut just foreign policy.
free from envious or ambitious national
schemes, and characterized by entire hon-
esty and sincerity.
A gratifying recognition of the uniform
impartiality of this country toward all
foreign states was manifested by the coin—
cident request of the Chinese and. J apa-
nese governments that the agents "of the
United States should. within proper lim-
its. aiford protection to the subjects of the
other during the suspension of diplomatic
relations due to estate of war. This deli-
cate office was accepted, and a misappre-
hension which gave rise to the belief that
in affording this kindly unofficial protec-
tion our agents would exercise the same
authority which the withdrawn agents of
the belligerents had exercised. ' was
promptly corrected. Although the war be-
tween Chino and J span endangers no pol~
icy of the United States, it deserves. our
gravest consideration by reason of its dis-
turbance of our growing commercial in-
terests in the two countries and the in-
creased dangers which may result to our
citizens domiciled or sojourning in the in-
terior of China.
Acting under a stipulation in our treaty
with Korea (the first concluded with a
western power). I felt constrained at the
beginning of the. controversy to tender
our good offices to induce an amicable ar—
rangement of the initial difficulty grow-
ing out of the Japanese demands for ad-
ministrative reforms in Korea. but the
unhappy precipitation of actual hostilities
defeated this kindly purpose.
Deploring the destructive war betwoen ,
the two most powerful of the eastern na-
tions and anxious that our commercial in-
‘terests in these countries may be pre-
served, and thatothe safety of our citizens
there shall not be jeopardized. I would
not hesitate to heed any intimation that
our friendly aid for the honorable termi-
nation of hostilities would be acceptable
to both belligerents.
The Sugar Differential.
The German government has protested
against that provision of the customs
tarifi act. which imposes a discriminating
duty of one-tenth'of 1 cent a pound, on
sugarsicomin'g from countries paying an
export bounty thereon. claiming that the
exaction of such duty is in contravention
of articles '5 and 9 of the treaty of 1828
with Prussia.
In the interests of the commerce of both
countries and to avoid even the accusation»
of treaty violation ,1 :reccmmend the re-
peal of so much of the statute as imposes:
that duty, and I invite attention to the-
report of thesecret’ary of state containing
a discussion“? gof the questions raised by
the German protests. _
Early in the present year an agreement
was reach ed with Great Britain concerning
instructions to be given to the naval cem-
manders of the two governments in Be-
ring sea and the contiguous north Pacific
ocean for their guidance in the execution
of the award of the Paris tribunal of ar—
bitration and the enforcement of the reg-
ulations therein prescribed for the pro
tection of seal life in the waters mention-
ed. An understanding has also been
reached fer the payment by the United
States of $425,000 in full satisfaction of
all claims which may be made by Great
Britain for damages growing out of the
controversy as to fur seals in Bering sea
or the seizure of British vessels engaged
in taking seal .in these waters
Since communicating the voluminous
correspondence in regard to Hawaii and
the action taken by the senate and house
of representatives on certain questions
submitted to the judgment and wider dis-
cretion of congress the organization of a
government in 'place of the provisional ar-
rangement which followad the deposition
of, the queen has been announced, with
evidence of its effective operation. The
recognition usual in such cases has been
accorded the new government.
Apart from the war in which the island
empire is engaged Japan attracts increas
ing attention in this country by her evi-
dent desire to cultivate more liberal in-
tercourse with us and to seek our kindly
aid in furtherance of her laudable desire
for complete autonomy in her domestic
affairs and full equality in the family of
nations. The Japanese empire of today
is no longer the Japan of the past, and
our relations with this progressive nation
should not be less bread and liberal than
those with other powers.
he hiosquito Incident.
Prominent among the questions of the
year was the Bluefields incident. in what
is known as the Mosquito Indian strip,
bordering on the Atlantic ocean and
within the jurisdiction of Nicaragua. By
the treaty of 1860 between Great Britain
and Nicaragua the former government ex-
pressly recognized the sovereignty of the
latter over the strip. and a limited form
of self government was-guaranteed to the
{Mosquito Indians. to be exercised accord-
‘ing to their customs. for themselves and
other dwellers within its limits. The so
called native government, which grew to
be largely made up of aliens, for many
years disputed the sovereignty of Nicara-
gua over the strip and claimed the right
to maintain therein a practically inde-
pendent municipal government.
Early in the past year efforts of Nic
ragua to maintain sovereignty over
Mosquito territory led to serious distu
organization.
the existing local government establi
and upheld by Nicaragua.
Although the alien interests arr
against Nicaragua in these transact ons
have been largely American and the cdm-
merce of that region for some time gas
'been and still is chiefly controlled by ur
citizens, we cannot for that reason 0 al-
.lenge the rightful sovereignty of N.ca-‘
. rag-us over this important part of her 0-
main.
of the time two, of our naval ships 1 ave
been stationed at Blueficlds for'the pr tee-
tion of all 1. :itimate interests '6: our citi-
zens. in September last the govern out
For some months one. and duringjart
(K
2 .
I‘
‘5‘
om": start
.3295!
.'icaur__._for , " ""géd participation in the I'dlr
.if ._ tion!" orrsyolutionary movements against
’ ' , . , bile at .Blueflelds nlready men--
s“ we menptioniswlegr;_,$ionod'.sj1.lut through the earnest mo..-
1 sillitsefbhutsed withi‘th‘e 3 ..
the it"
csjof thisngVernment the 'two Amer-
": 993393113. ’finagen’i lit: ofgthelruhnsi-
«ems organisisommsumw the-em
is: these." disturbances." by; pi: contrast
exhibition of firmness" andi‘jgood 'ju'dg:
ment, contributed largely to ‘the preven-
tion of more serious consequences and to
the restoration of quiet and order. I re-
gret that in the midst of these occurrences
there happened a most grave‘ and irritat-
» ing failure of Nicaraguan justice. An
American citizen named Wilson. residing
at Ram‘s. in the Mosquito territory, was
murdered by one Arguello, the acting
governor of the town. After some delay
the murderer was arrested, but so inse-
curely confined or guarded that he es:
caped. and notwithstanding our repeated
demands it is claimed that his recapture
has been impossible by reason‘of his flight
beyond Nicaraguan jurisdiction.
The government of Salvador having
been overthrown by an abrupt popular
outbreak. certain of its military and civil
officers. while hotly pursued by infuriated
insurgents. sought refuge on' board the
United States warship Benning’ton. then
lying in a Salvadorean port. Although
the practice of asylum is not favored by
this government. yet in view of the im-
minent peril Which threatened the fugi-
tives. and solely from considerations of
humanity, they were aflorded shelter by
our naval commander. and when after-
ward demanded under our treaty of extra-
dition with Splvador for trial on charges
of murder, arson and robbery I directed
that such of them as had not voluntarily
left the ship be conveyed to one of our
nearest ports where a hearing could be
had before a judicial officer in compliance
with the terms of the treaty. - On their
arrival at San Francisco such a proceeding
was promptly instituted before the United
States district judge, who held that the
acts constituting the alleged offenses were
political and discharged all the accused
except one Cienfuegos, who was held for
an attempt to murder. Thereupon I was
constrained to direct his release, for the
reason that an attempt to murder was not
one of the crimes charged against him‘
and upon which his surrender to the Sal—
vaderean authorities had been demanded.
The EIora. Claim.
The Mora case, referred to in my last
annual message, remains unsettled. From
the diplomatic correspondence on this
subject. which has been laid before the
senate, it will be seen that this govern-
ment has ofi‘ered to conclude a convention
with Spain for disposal by arbitration of
outstanding claims between the two coun-
tries, except the Mora claim. which, hav-
ing been long ago adjusted, now only
awaits payment as stipulated. and of
course it could not be included in the pro-
posed convention. It was hoped that this
offer would remove parliamentary obsta-
cles encountered by the Spanish govern-
ment in providing payment of the More
indemnity. I regret to say that no defi-
nite reply to this offer has yet been made,
and all efforts to secure payment of this
settled claim have been unavailing.
In my last annual message I referred
briefly to the unsatisfactory state of af-
fairs in: Samoa under the operation of the
:Berli-n treaty as signally illustrating the‘
.impolicy of entangling alliances with for- .
sign powers, and on May 9. 1894, inre-
sponse to a resolution of the senate. Isent
a special message and documents to that
body on the same subject. which empha.
sized mv previously. expressed .opinlonl.
Later occurrences, the correspondence in
regard to which will be laid before con-
gress. further demonstrate that the gov-
ernment which was devised by the three
powers and forced upon the Samoans
against their inveterate hostility can be
maintained only by the continued pres-
ence of foreign military force and at no
small sacrifice of life and treasure.
The suppression of the Mataafa insur-
rection by the powers and the subsequent
banishment of the leader and. 11 other
chiefs, as recited in my last message, did
not bring lasting peace to the islands.
Formidable uprisings continued. and
finally a rebellion broke out in the capital
island, Upolu. headed in Aana, the west-
ern district, by the younger Tamasese.
and in Atua, the eastern district. by other
leaders. The insurgents ravaged the coun-
try and fought the government’s troops
up to the very doors of Apia. The king
again appealed to the powers for help. and
the combined British and German naval
forces reduced the Atuans to apparent
subjection, not. however, without consid-
erable loss to the natives. A few days
later Tamasese and his adherents. fearing
the ships and the marines. professed sub-
mission. ‘
The present government has utterly
failed to correct. if indfied it has not 6g-
gravated, the very evllsit was intended to
prevent. It has not stimulated our com-
merce with the islands. Our participation
in its establishment against the wishes of
the natives was in plain defiance of the
conservative teachings and warnings of
the wise and patriotic men who laid the
foundations of our free institutions, and
I invite an expression of the judgment of
congress on the propriety of steps being
taken by this government looking to the
withdrawal from its engagements with
the other powers on some reasonable
terms not prejudicial to any of our exist-
ing rights.
Treasury Receipts.
The secretary of the treasury reports
that the receipts of the government from
all sources of revenue during the fiscal
year ending June 30. 1894, amounted to
$372,802,498.29, and its expenditures to
$442,605.758.87, leaving a deficit of $69,-
803,26058. There was a decrease of $15,-
952,674.66 in the ordinary expenses of the
government, as compared with the fiscal
year 1893.
There was collected from customs $131,-
818,350.62 and from internal revenue
$147,168, 449. 70. The balance of the in-
come for the year, amounting to $93,815,-
517.97. was derived from the sales of lands
and other sources.
The value of our total dutiable imports
amounted to $275,199,086, being $146.-
657,625 less during the preceding year,
and the importations free of duty amount-
ed to $379, 795, 536, being $64,748,675 less
than during the preceding year. The re-
ceipts from customs were 873.536.486.11
less, and from internal revenue $13, 886,-
539.97 less than in 1893.
The total tax collected from distilled
spirits was $85. 259,250.25; on manufac-
tured tobacco, $28,617.898.62. and on fer-
mented liquors, $31,414.788.04.
Our experts of merchandise, domestic
and foreign, amounted during the year
to $892,140, 572, being an increase over
the preceding year of $44,495,378.
The total amount of gold exported dur-
ing the fiscal year was $76,898,061. as
against $108, 680, 444 during the fiscal year
1893. The amount imported was $72,-
449,119. as against $21,174,381 during the
previous year.
The imports of silver were $13,286,552,
and the exports were $50,451,265.
15““ “‘v -“ "”' "w-«n-u.
_IH!_-eljlmatedthatupon the basis or
_’ WEE
,.._ ,. .. . . .. cozy, ”is?
its, poms. 953w}; fuels-cinema diam.
teen permitted to return to.
,iinfl."fiwifinii.®§hnue 'laws the receipts of
the‘government during the current fiscal
year endingJune 3, 1895. will be $424.-.—.
427, 748.44,,an'd its expenditures $444,427,-
. 748.44. resulting in a deficit of $20,000,-
000.
On the‘first day of November. 1894-,
the total stock of money of all kinds in
the country was $2.240.773.888.- as against
8,204,651,000 on the first day of N ovem-
ber. 1893, and ,the money of all kinds in
circulation. or‘notincluded in - the treas-
nrraigholdingsi' was $1,572,093.422. ‘» or
$24. 27 per capita. upon anestlma’ted pop-
ulation of 68,887,000. At the same date
there was held ‘in‘the‘streasury-gold bul-
lion amounting to» $44,615.177g55, and
silver bullion which was purglria‘sefdat a
cost of $127,779,988. ‘
silver bullion under the act of July-'14...
1890. ceased on the first day of November.
1893. and up to that time there had been
purchased during the fiscal year 11,917.-
658.78 fine ounces at a cost of $8,715,-
521. :52, an average cost of $0.7313 per fine
ounce. -The total amount of silver pur-
chased'from the time that law took effect
until‘the repeal of its purchasing clause,
on the date last mentioned. was 168.67 4,-
682.53 fineounces. which cost $155,931.-
002.25, the average price per fine ounce
being $0. 92244.
The total amount of standard silver
dollars coined at the mints of the United
States since the passage of the act of Feb.
28, 1878, is $421,776, 408, of which $78.-
166, 739 were coined» under the provisions
of that act. 338.531.1433 under the previ-
sions of the act of July 14, 1890, and $5,-
078,472 under the act providing for the
coinage of trade dollar bullion. ‘
The Army.
From the report of the secretary of war
it appears that the strength of the army
on Sept. 30, 1894, was‘2,135 officers and
25,765 enlisted men. Although this- is
apparently a very slight decrease com-
pared with the previous year. the actual
effective force has been increased to the
equivalent of nearly two regiments
through the reorganization of the system
of.recruiting. and the consequent release
to regimental duty ‘Of the large force of
men hitherto serving at the recruiting
depots. " The abolition of these depots. it
is predicted. will furthermore efi‘ect an
annual reduction approximating $250,000
in the direct expenditures. besides pro-
moting generally the health, morals and
discipline of the troops.
Though the forces of the department of
the east have been somewhat increased.
more than threesfou’rths of the army is
still stationed west of the Mississippi.
This carefully matured policy, which se-
cures the best and greatest service in the
interests of the general welfare from the
small force comprising our regular army,
should not be thoughtlessly embarrassed
by the creation of new and unnecessary
posts through acts of congress to gratify
the ambitions or interests of localities.
While the maximum legal strength of
the army is 25,000 men. the eflective
strength, through various causes, is but
little over 20.000 men. The purpose of
congress does not, therefore, seem to be
fully attained by the *existing condition.
While no considerable increase in the
army is. in my judgment. demanded by
recent events, the policy of seacoast forti-
fication. in the prosecution of which we
have been steadily engaged for some years,
has so-‘far developed as to suggest that the
effective strength of the army be now
made at least equal to the legal strength.
Measures taken by the department during
the year, as indicated,-ha_ve already con-
siderably augmented the effective force,
and the secretary of war presents a plan,
which I recommend to the consideration
of congress, to attain the desired end.
It is hardly necessary to recall the fact
that in obedience to the commands of the
constitution and the laws. and for the
purpose of protecting the property of the
United States. aiding the process of fed-
eral courts and removing lawless obstruc-
tions to the performance by the govern-
ment of its legitimate functions. it be-
came necessary in various localities dur-
ing the year to employ a considerable por-
tion of the regular troops. The duty was
discharged promptly, courageously and
with marked discretion by the officers and
men. and the most gratifying proof was
thus afforded that the army deserves that
complete confidence in its efficiency and
discipline which the country has at all
times manifested.
The skill and industry of our ordnance
officers and inventors have, it is believed.
overcome the mechanical obstacles which
have heretofore delayed the armament of
our coasts, and this great national under-
taking upon which we have entered may
now proceed as rapidly as congress shall
determine. With a supply of finished
guns of large caliber already on hand, to
which addition should now rapidly fol-
low, the wisdom of providing carriages
and emplacements for their mount cannot
be too strongly urged.
The total enrollment of the militia of ,
The purchased . j . , ,
mission of this second class matter‘is i
the several states is 117,533 oflicers and ;.
. coming fiscal year. and at least 3% years
enlisted men. an increase of 5,343.
In recognition of the long and distin-
guished military services and faithful dis-
charge of delicate and responsible civil
duties by Major General John M. Scho-
fleld, now the general commanding the
army. it is suggested to congress that the '
temporary revival of the grain of lieuten-
ant general in his behalf would be a just- 9
and gracious act and would permit his re—
tirement. new near at hand. with rank bo-
iitting his merits.
The Department of Justice.
The report of the attorney general notes
the gratifying progress made by the su-'
preme court in overcoming the arrears of
its business and in reaching a condition
in which it will be able to dispose of
cases as they arise without any unreason-
able delay. This result is of course very
largely due to the successful working of
the plan inaugurating circuit courts of
appeals.
Eight years ago in my annual message
I urged upon the congress as strongly as
I could the location and construction of
two prisons for the confinement of United
States prisoners. A similar recommenda—
tion has_ been made from time to time
since. and a few years ago a law was
passed providing for the selection of sites
for three such institutions. N o appropri-
ation has, however, been made to carry
the not into effect. and the old and dis-
creditablc condition still exists.
The Postoilicc Department.
The report of the postmaster general
presents a comprehensive statement of
the operations of the postoffice department
for the last fiscal year.
The receipts of the department during
the year amounted to $75,080,479.04 and
the expenditures to $84,324,414. 15.
The transactions of the postal service
indicate with barometric certainty the
fluctuations in .the businessrof the coun-
try. ’ Inasmuch. therefore. as business
complications continued to exist through-
out the last year to an unforeseen extent,
it is n‘iit surprising that the deficiency of
revenue to meet the expenditures of the
postofi‘ice department, which was estimat-
ed in advance at about $8. 000. 000, should ,
be exceeded by nearly $1,125. 000. The as-
l
RWALK (1.4be ‘ ,,
certalned revenues at the last year. wnicn
were the basis of calculation for the cur-
. rent yeah-being less 7 than. estimated-Mic
deficiencxfpr the current year willi befcor-
respondingljtrgreater. ..-'though the post-
masterlgcne'ral states that'the latests'lndt
cations are so favorable that he confident-I
ly predicts an increase of at leastxs per
cent in the revenues of the current-year
over those of the last year.
The expenditures increase steadilyand
necessarily with the growth and needs of
the country. so that . the deficiency is
greater or less in any year, depending up-
on the volume of receipts. 7
The postmaster general. states that this
deficiency is unnecessary and might be ob-
viated at once if the law regulating rates
upon mail matter of the second class'was
modified. The rate received for the trans
cent per pound. while the cost of such
transmission to the government is eight .
times that amount. In the generalterms .
of the law this rate covers newspapers
and periodicals. The .extensionsof the «‘1-
meaning of these terms, from time to time
have admitted to the privileges intended
for legitimate newspapers and periodicals
a surprising range of publications and
created abuses the cost of which amount:
in the aggregate to the total deficiency of
the postoflice deparhnent. '
The total number of postofiices in the
United States on the 30th day of J une‘,
1894, was 69,805, an increase of 1. 403 over'
the preceding year. Of these 3,428 were
presidential. an increase in that class of
68 over the preceding year. '
Six hundred and ten cities and towns
are provided with free delivery. Ninety-
three other cities and towns entitled to
this service under the law have not been
accorded it on account of insufficient
funds. The expense of free delivery for
the current fiscal year will be more than
$12.300.000. and under existing legisla-
tion this item of expenditure is subject
to constant increase. The estimated cost
of rural free delivery generally is so very
large that it ought not to be considered in
the present condition of affairs.
During the year 830 additional domes-
tic money order offices were established.
The total number of these oifices at the
close of the year was 19,264. There were
14,304,041 money orders issued during
the year. being an increase over the pre-
ceding year of 994,306. The value of these
orders amounted to $138,793,579.49. an
increase of $11.217.145.84. There were
also issued during the year postal notes
amounting to $2,649,094.55.
The number of letters and packages
mailed during the year for special deliv-
ery was 3. 436,970. The special delivery
stamps used upon these letters and pack-
ages amounted to $343,697. The mes-
sengers’ fees paid for their delivery
amounted to $261,209.70, leaving a bal-
ance in favor of the governmentof $82,-
487.30. There are now cennectedwith the
postoflice establishment 32,661 employees
who are in the classified service. This in-
cludes many who have been classified up‘
on the suggestion of the postmaster'g‘eng-
eral. He states that another year’s expe-
rience at the head of the department serves-
only; strengthen the conviction' as to
the 5x1 llent working of the civil service
law idth’is branch of the public service.
The Navy Department.
Attention is called to the report of the
secretary of the navy. which shows very
gratifying progress in the construction of
ships for our new navy. All the vessels
new building. including the threfi torpedo
boats authorized at the last session of
congress, and excepting the first class
battleship Iowa. will probably be com«
pleted during the coming fiscal year.
The estimates for the increase of the
navy for the year ending June 30, 1896,
are large, but they indude practically the
entire sum necessary to complete and
equip all the new ships not now in com-
mission so that. unless new ships are an-
thorized, the appropriations for the naval
service for the fiscal year ending June 30,
1897, should fall below the estimates for
the coming year by at least $12, 000, 000.
The secretary presents with much ear-
nestness a plea for the authorization of
threeadditionai battleships and 10 or 12
torpedo boats. While the unarmored ves-
sels heretofore authorized. including those.
now nearing completion, will constitute
a fleet which, itis believed. is sufficient
for ordinary cruising purposes in time of
peace. We have now completed and in
process of construction but four first class
battleships and but few torpedo boats. If
we are to have a navy for warlike opera-
tions, offensive and defensive, we certain-
ly ought to increase both the number of
battleships and torpedo boats. .
The manufacture of armor requires ex-
pensive plant. and the aggregation of
many skilled workmen. All the armor
necessary to complete the vessels new
building 'will be delivered before the let
of June next. If no new contracts are
given out, contractors must disband their
workmen. and their plants must lie idle.
Battleships authorized at this time would
not be well under way until late in the
from the date of the contract would be
required for their completion. The secre-
tary states that not more than 15 per cent
of the cost of such ships need be included
in the appropriations for the coming year.
I recommend that provision be made
for the construction of additional battle-
ships and torpedo boats.
The secretary recommends the manu-
facture not only. of a reserve supply of
ordnance and ordnance material for ships
of the navy. but also a supply for the aux-
iliary fleet. . _
Guns and their appurtenances should be
provided and kepton hand for both these
purposes. We have not today a single
gun that could be put upon the ships
Paris or New York of the International
Navigation company or any other ship of
our reserve navy.
I feel it my imperative duty to call at-
tention to the recommendation of the sec-
retary in regard to the personnel of the
line of the navy. The stagnation of pro-
motion in this, the vital branch of the
service. is so great as to seriously impair
its efficiency. ‘ .
I consider it of the utmost importance
that the young and middle aged officers
should, before the eve of retirement, be
permitted to reach a grade entitling them
to active and important duty.
The Interior Department.
The report of the secretary of the inte-
rior exhibits the situation of-the numerous
and interesting branches of the public
service connected with his department.
I commend this report and the valuable
recommendations of the secretary to the
careful attention of the congress.
The public land disposed of during the
year amounted to 10.406.100.77 acres. in
cluding 28,876.05 of Indian lands.
It is estimatodethat the public domain
still remaining amounts to a little more
than 600,000,000 acres, excluding. how-
ever, about 360. 000,000 acres in Alaska as
well as military reservations and railroad
and other selections of lands yet unadjudi-
cated.
THE FOREESTS.—I fully indorse the rec-
ommendation of the secretary that ads-
-ate protection be provided for our for-
est retentijniu‘. that 15.5-90.1" propensive for- *
est” .sssOcnifiWMWML Smhi'hsli'
- ers and _ super-intendenta,zaskaro’ndo¢.l'm
to protect the forests already reserved
should be provided. I am of the opinion
that there should be an abandonment of
the poiiey'sanctioned by present laws un-
der which the government for a very
small consideration is rapidly losing title
to immense tracts of land covered with
timber which should be properly reserved
as permanent sources of timber supply.
THE morass—Though the condition of
the Indians shows a steady and healthy
progress. their situation is not satisfac-
tory at all points. Some of them to
whom allotments of land have been made
are found to..be unable .or disinclined to
follow agricultural pursuits or to other-
wise beneficially manage their land. This
is especially true of the Cheyennes and
Arapahoes. who, as it appears by reports
of their agent. have in many instances
never been located upon their allotments.
and in some cases do not even know
where their allotments are.
Primers—At the close of the last fis-
cal year, on the 30th day of J une. 1894,
there were 969,544 persons on our pension
rolls. being a net increase of 3,532 over
the number reported at the end of the
previous year.
The total amount expended for pen-
, sions during the year was $139. 804, 461.05.
Civil Service Reform.
The advantages to the public service of
an adherence to the principles of civil
service reform are constantly more ap-
parent. and nothing is so encouraging to
those in ofiicial life who honestly desire
good government as the increasing appre-
ciation by our people of these advantages.
A vast majority of the voters of the land
are ready to insist that the time and at-
tention of those they select to perform for
them important public duties should not
be distracted by doling out minor ofifices,
and they are growing to be unanimous in
regarding party organization as some
thing that should be used in establishing
party principles instead of dictating the
distribution of public places as rewards of
partisan activity. -
I am entirely convinced that we ought
not to be longerwithout a national board
of health or national health officer charged
with no other duties than such as pertain
to the protection of our country from the
invasion of pestilence and disease.
Tar-ix Amendments.
The tariff act passed at the last session
of the congress. needs important amend—
ments if it is to be executed effectively
and with certainty. In addition to such
necessary amendments as will not change
rates of duty I am still very decidedly in
favor of putting coal and iron upon the
free list.
So far as the sugar schedule is con-
cerned, I would be glad, under existing
aggravations. to see every particle of dif-
ferential duty in favor of refined sugar
stricken out of our tariff law. If with all
the favor now accorded the sugar refining
interest in our tarifl laws it still lan-
gulshes to the extent of closed refineries
and thousands of discharged workmen, it
would seem to present a hopeless case for
reasonable legislative aid. Whatever else
is done or omitted. I earnestly repeat here
the recommendation I have made in an-
other portion of this communication that
the additional duty of one-tenth of a cent
per poun d, laid upon sugar imported from
countries paying a bounty on its export.
be abrogated.
With the advent of a new tariff policy
not only calculated to relieve the consum-
ers of our land in the cost of their daily
life, but to invite a better development of
American thrift and create for us closer
and more profitable commercial relations
with the rest of the world. it follows as a
logical and imperative necessity that we
should at once remoge the chief. if not
the only, obstacle which has so long pre-
vented our participation in the foreign
carrying trade of the sea. A tariff built
upon the theory that it is well to cheek
imports, and that a home market should
bound the industry and efiort of Ameri—
can producers. was fitly supplemented by a
refusal to allow- American registry to ves-
sels built abroad, though owned and navi-
gated by our people. Our new tariff pol‘
icy is consistently supplemented by the
greatest possible liberty to our citizens in
the ownership and navigation of ships in
which our products and manufactures
may be transported.
The ancient provision of our law deny-
ing American registry to ships built
abroad and owned by Americans appears
in the light of present conditions not only
to be a failure for good at every point, but
to be nearer a relic of barbarism than any~
thing that exists under the permission of
a statute of the United States. I earnestly
recommend its prompt repeal.
The Bond Issue.
During the last month the gold re-
served in the treasury for the purpose of
redeeming the notes of the government
circulating as money in the hands of the
people became so reduced, and its further
depletion in the near future seemed so
certain, that in the exercise of proper care
for the public welfare it became necessary
to replenish this reserve and thus main-
tain popular faith in the ability and de-
termination of the government to meet,
as agreed. its pecuniary obligations.
It would have been well if in this am-
ergency authority had existed to issue the
bonds of the government bearing a low
rate of interest and maturing within a
short period. but the congress having
failed to confer such authority, resort was
necessarily bad to the resumption act of
1875, and pursuant to its provisions bonds
were issued drawing interest at the rate
of 5 per cent per annum and maturing
ten years after their issue. that being the
shortest time authorized by the act.‘ I am
glad to say. however, that on the sale of
these bonds the premium received operat-
ed to reduce the rate of interest to be paid
by the government to less than 3 per cent.
Nothing could be worse or further ”re-
moved from sensible finance than the re-
lations existing between the currency the
government has issued. the gold held for
its redemption and the means which must
,be resorted to for the purpose of replenish-
lng such redemption fund when impaired.
Evenif the claims upon this fund were
confined to the obligations originally in—
tended and if the redemption of these
obligations meant their cancellation, the
fund _ would be very small. But these
obligations when received and redeemed
in gold are not canceled, but are reissued
and‘may do duty many times by way of
drawing gold from the treasury. Thus
We have an endless chain in operation
constantly depleting the treasury’s gold
and never near a final rest. As if this
was not bad enough. we have. by a statu<
tory declaration that it is the policy of the
government to maintain the parity be-
tween ‘gold and silver, aided the force and
momentum of this exhausting process
and added largely to the currency obliga-
tions claiming this peculiar gold redemp-
tion. Our small gold reserve is thus sub-
ject to drain from every side. The de-
mands that increase our danger also in-
crease the necessity of protecting this re-
serve against depletion. and it is most
unsatisfactory to know that the protection
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r
afforded is .onlya temporary palliation. ’
It is perfectly and paipably plain that
the only way under present conditions by
which this reserve when dangerously de-
pleted can be replenished is through the
issue and sale of the bonds of the govern-
ment for'gold. and yet congress has not
only thus far declined to authorise the
issue of bonds best suited to such a pur-
pose, but there seems a disposition inseme
quarters to deny both the necessity and
power for the issue of bonds at- all. ,,
I cannot for a moment believe that“,
of our citizens are deliberately willing
- that their government should default in
its pecuniary obligations or that its finan-
clal operations should be reduced to a
silver basis. At any rate. Ishould not feel
that my duty Was done if I, omitted any
efiort I could m'ake to avert such-a zialam-
. therefore as no provi on is
igde'f‘oi- lth‘h’fihal’ redemption or the put-
ting aside of the currency obligation now
used to repeatedly and constantly draw
from the government its gold, and as long
as no better authority for bond issues is
allowed than , at present exists.-suoh au-
thority will be utilized whenever and as
often as it becomes necessary to maintain
, a sufficient gold reserve. and in abundant
time to save the credit of our country and
make good the financial declarations of
our government.
Questions relating to our banks and
currency are closely connected with the
subject just referred to, and they also
present some unsatisfactory features.
Prominent among them are the lack of
elasticity in our currency circulation'aud
its frequent concentration in financial
centers when it is most needed in other
parts of the country.
State Bank Issues.
The absolute divorcement of the gov-
ernment from the business of banking is
the ideal relationship of the government
to the circulation of the currency of the
country.
This condition cannot be immediately
reached. but as a step in that direction
and as a means of securing a more elastic
currency and obviating other objections
to the present arrangement of bank circu-
lation the secretary of the treasury pre-
seats in his report a scheme modifying
present banking laws and providing for
the issue of circulating notes by state
banks free from taxation under certain
limitations.
The secretary explains his plan so
plainly, and its advantages are developed
by him with such remarkable clearness.
that any effort on my part to present ar‘
gument in its support would be superflu-
ous. I shall therefore content myself
with an unqualified indorsement of the
secretary’s proposed changes in the law
and a brief and imperfect statement of
their prominent features.
It is proposed to repeal all laws provid-
ing for the deposit of UnitedStates bonds
as security for circulation; to permit na-
tional banks to issue circulating notes
not exceeding in amount 75 per cent of
their paid up and unimpaired capital,
provided they deposit with the govern—
ment as a guarantee fund in United
States legal tender notes, including treas-
ury notes of 1890. a sum equal in amount
to 30 per cent of the notes they desire to
issue, this deposit to be maintained at all
times, but whenever any bank retires any
part of its circulation a proportional part
of its guarantee fund shall he returned to
it; to permit the secretary of the treasury
to prepare and keep on hand ready for is-
sue in case an increase in circulation is
desired blank national banknotes for eaph
bank having circulation. and to repeal the
provisions of the present law imposing
limitations and restrictions upon banks,
desiring to reduce er increase their circu-
lation. thus permitting such increase or
reduction within the limit of 75 per cent
of capital to be quickly made as emer-
gencies arise.
In addition to the guarantee fund re-
quired, it is proposed to provide a safety
fund for the immediate redemption of the
circulating notes of failed banks, by im-
posing a small annual tax, say one-half of
1 per cent. upon the average circulation
of each bank until the fund amounts to 5
per cent of the total circulation outstand-
ing. When a bank fails, its guarantee
fund is to be paid into this safety fund.
and its notes are to be redeemed in the
first instance from such safety fund thus
- augmented—any impairment of such fund
caused thereby to be made good from the
immediately available cash assets of said
bank. and if these should be insufiicieni
such impairment to be made good by prc
rata assessment among the other banks.
their contributions constituting a firsi
lien- upon the assets of the failed bank in
favor of the contributing banks. As a
further security it is contemplated thai
the" existing provision xxing the indivi~
dual liability of stockholders is to be re
tained. and the bank’s indebtedness on
account of its circulating notes is to be
made a first lien on all its assets.
For the purpose of meeting the expense
of printing notes, official supervision,
cancellation and other like charges there
shall be imposed a tax of, say, one-half oi
1 per cent per annum uppn the average
amount of notes in circulation.
It is further provided that there shall
be-no national bank notes issued of a less
denomination than $10; that each na-
tional bank. except in case of a failed
bank. shall redeem or retire its notes in
the first instance at its own omen or at
agencies to be designated by it, aw] thai
no fixed reserve need be maintains-d on
account of deposits.
Exemption From Taxation.
Another very important feature of this
plan is the exemption of state banks from
taxation by the United States in cases
where it is shown to the satisfaction of
the secretary of- the treasury, and comp-
troller of the currency by banks claim-
ing such exemption” that they have not
had outstanding their circulating notes
exceeding 75 per cent of their paid up'and
unimpaired capital; that their stockhold-
ers are individually liable for the redemp-
tion of their circulating notes to the full
extent of their ownership of stock; that
the liability of said banks upon their cir-
culating notes constitutes under their
state law a first lien upon their assets;
that 'such banks have kept and main-
tained a guarantee fund in United States
legal tender notes. including treasury
notes of 1890, equal to 30 per cent of their
outstanding circulating notes and that
such banks have promptly redeemed their
circulating notes when presented at their
principal or branch offices. '
It is quite likely that this scheme may
be usefully amended in some of its de-
tails, but I am satisfied it furnishes a
basis for a very great improvement in our
present banking and currency system.
I conclude this communication fully ap-
preciating that the responsibility for all
’ legislation afieoting the people of the
United States rests upon their represent-
atives in the congress and assuring them
that. hether in accordance with recom—
mendations I have made or not. Ishall
be glad to co-operate in perfecting any
legislation that tends to the prosperity
and welfare of our country.
GROVER CLEVELAND.
Executive Mansion, Dec. 3.
Norwalk Chronicler