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President[ William McKinley

         Date[ December 5, 1899

To the Senate and House of Representatives:

At the threshold of your deliberations you are called to mourn with your

countrymen the death of Vice-President Hobart, who passed from this life on

the morning of November 21 last. His great soul now rests in eternal peace.

His private life was pure and elevated, while his public career was ever

distinguished by large capacity, stainless integrity, and exalted motives.

He has been removed from the high office which he honored and dignified,

but his lofty character, his devotion to duty, his honesty of purpose, and

noble virtues remain with us as a priceless legacy and example.

The Fifty-sixth Congress convenes in its first regular session with the

country in a condition of unusual prosperity, of universal good will among

the people at home, and in relations of peace and friendship with every

government of the world. Our foreign commerce has shown great increase in

volume and value. The combined imports and exports for the year are the

largest ever shown by a single year in all our history. Our exports for

1899 alone exceeded by more than a billion dollars our imports and exports

combined in 1870. The imports per capita are 20 per cent less than in 1870,

while the exports per capita are 58 per cent more than in 1870, showing the

enlarged capacity of the United States to satisfy the wants of its own

increasing population, as well as to contribute to those of the peoples of

other nations.

Exports of agricultural products were $784,776,142. Of manufactured

products we exported in value $339,592,146, being larger than any previous

year. It is a noteworthy fact that the only years in all our history when

the products of our manufactories sold abroad exceeded those bought abroad

were 1898 and 1899.

Government receipts from all sources for the fiscal year ended June 30,

1899, including $11,798,314,14, part payment of the Central Pacific

Railroad indebtedness, aggregated $610,982,004.35. Customs receipts were

$206,128,481.75, and those from internal revenue $273,437,161.51.

For the fiscal year the expenditures were $700,093,564.02, leaving a

deficit of $89,111,559.67.

The Secretary of the Treasury estimates that the receipts for the current

fiscal year will aggregate $640,958,112, and upon the basis of present

appropriations the expenditures will aggregate $600,958,112, leaving a

surplus of $40,000,000.

For the fiscal year ended June 30, 1899, the internal-revenue receipts were

increased about $100,000,000.

The present gratifying strength of the Treasury is shown by the fact that

on December 1, 1899, the available cash balance was $278,004,837.72, Of

which $239,744,905.36 was in gold coin and bullion. The conditions of

confidence which prevail throughout the country have brought gold into more

general use and customs receipts are now almost entirely paid in that

coin.

The strong position of the Treasury with respect to cash on hand and the

favorable showing made by the revenues have made it possible for the

Secretary of the Treasury to take action under the provisions of section

3694, Revised Statutes, relating to the sinking fund. Receipts exceeded

expenditures for the first five months of the current fiscal year by

$13,413,389.91, and, as mentioned above, the Secretary of the Treasury

estimates that there will be a surplus of approximately $40,000,000 at the

end of the year. Under such conditions it was deemed advisable and proper

to resume compliance with the provisions of the sinking-fund law, which for

eight years has not been done because of deficiencies in the revenues. The

Treasury Department therefore offered to purchase during November

$25,000,000 of the 5 per cent loan of 1904, or the 4 per cent funded loan

of 1907, at the current market price. The amount offered and purchased

during November was $18,408,600. The premium paid by the Government on such

purchases was $2,263,521 and the net saving in interest was about

$2,885,000. The success of this operation was sufficient to induce the

Government to continue the offer to purchase bonds to and including the 23d

day of December, instant, unless the remainder of the $25,000,000 called

for should be presented in the meantime for redemption.

Increased activity in industry, with its welcome attendant--a larger

employment for labor at higher wages--gives to the body of the people a

larger power to absorb the circulating medium. It is further true that year

by year, with larger areas of land under cultivation, the increasing volume

of agricultural products, cotton, corn, and wheat, calls for a larger

volume of money supply. This is especially noticeable at the

crop-harvesting and crop-moving period.

In its earlier history the National Banking Act seemed to prove a

reasonable avenue through which needful additions to the circulation could

from time to time be made. Changing conditions have apparently rendered it

now inoperative to that end. The high margin in bond securities required,

resulting from large premiums which Government bonds command in the market,

or the tax on note issues, or both operating together, appear to be the

influences which impair its public utility.

The attention of Congress is respectfully invited to this important matter,

with the view of ascertaining whether or not such reasonable modifications

can be made in the National Banking Act as will render its service in the

particulars here referred to more responsive to the people's needs. I again

urge that national banks be authorized to organize with a capital of

$25,000.

I urgently recommend that to support the existing gold standard, and to

maintain "the parity in value of the coins of the two metals (gold and

silver) and the equal power of every dollar at all times in the market and

in the payment of debts," the Secretary of the Treasury be given additional

power and charged with the duty to sell United States bonds and to employ

such other effective means as may be necessary to these ends. The authority

should include the power to sell bonds on long and short time, as

conditions may require, and should provide for a rate of interest lower

than that fixed by the act of January 14, 1875. While there is now no

commercial fright which withdraws gold from the Government, but, on the

contrary, such widespread confidence that gold seeks the Treasury demanding

paper money in exchange, yet the very situation points to the present as

the most fitting time to make adequate provision to insure the continuance

of the gold standard and of public confidence in the ability and purpose of

the Government to meet all its obligations in the money which the civilized

world recognizes as the best. The financial transactions of the Government

are conducted upon a gold basis. We receive gold when we sell United States

bonds and use gold for their payment. We are maintaining the parity of all

the money issued or coined by authority of the Government. We are doing

these things with the means at hand. Happily at the present time we are not

compelled to resort to loans to supply gold. It has been done in the past,

however, and may have to be done in the future. It behooves us, therefore,

to provide at once the best means to meet the emergency when it arises, and

the best means are those which are the most certain and economical. Those

now authorized have the virtue neither of directness nor economy. We have

already eliminated one of the causes of our financial plight and

embarrassment during the years 1893, 1894, 1895, and 1896. Our receipts now

equal our expenditures; deficient revenues no longer create alarm Let us

remove the only remaining cause by conferring the full and necessary power

on the Secretary of the Treasury and impose upon him the duty to uphold the

present gold standard and preserve the coins of the two metals on a parity

with each other, which is the repeatedly declared policy of the United

States.

In this connection I repeat my former recommendations that a portion of the

gold holdings shall be placed in a trust fund from which greenbacks shall

be redeemed upon presentation, but when once redeemed shall not thereafter

be paid out except for gold.

The value of an American merchant marine to the extension of our commercial

trade and the strengthening of our power upon the sea invites the immediate

action of the Congress. Our national development will be one-sided and

unsatisfactory so long as the remarkable growth of our inland industries

remains unaccompanied by progress on the seas. There is no lack of

constitutional authority for legislation which shall give to the country

maritime strength commensurate with its industrial achievements and with

its rank among the nations of the earth,

The past year has recorded exceptional activity in our shipyards, and the

promises of continual prosperity in shipbuilding are abundant. Advanced

legislation for the protection of our seamen has been enacted. Our coast

trade, under regulations wisely framed at the beginning of the Government

and since, shows results for the past fiscal year unequaled in our records

or those of any other power. We shall fail to realize our opportunities,

however, if we complacently regard only matters at home and blind ourselves

to the necessity of securing our share in the valuable carrying trade of

the world.

Last year American vessels transported a smaller share of our exports and

imports than during any former year in all our history, and the measure of

our dependence upon foreign shipping was painfully manifested to our

people. Without any choice of our own, but from necessity, the Departments

of the Government charged with military and naval operations in the East

and West Indies had to obtain from foreign flags merchant vessels essential

for those operations.

The other great nations have not hesitated to adopt the required means to

develop their shipping as a factor in national defense and as one of the

surest and speediest means of obtaining for their producers a share in

foreign markets. Like vigilance and effort on our part cannot fail to

improve our situation, which is regarded with humiliation at home and with

surprise abroad. Even the seeming sacrifices, which at the beginning may be

involved, will be offset later by more than equivalent gains.

The expense is as nothing compared to the advantage to be achieved. The

reestablishment of our merchant marine involves in a large measure our

continued industrial progress and the extension of our commercial triumphs.

I am satisfied the judgment of the country favors the policy of aid to our

merchant marine, which will broaden our commerce and markets and upbuild

our sea-carrying capacity for the products of agriculture and manufacture;

which, with the increase of our Navy, mean more work and wages to our

countrymen, as well as a safeguard to American interests in every part of

the world.

Combinations of capital organized into trusts to control the conditions of

trade among our citizens, to stifle competition, limit production, and

determine the prices of products used and consumed by the people, are

justly provoking public discussion, and should early claim the attention of

the Congress.

The Industrial Commission, created by the act of the Congress of June 18,

1898, has been engaged in extended hearings upon the disputed questions

involved in the subject of combinations in restraint of trade and

competition. They have not yet completed their investigation of this

subject, and the conclusions and recommendations at which they may arrive

are undetermined.

The subject is one giving rise to many divergent views as to the nature and

variety or cause and extent of the injuries to the public which may result

from large combinations concentrating more or less numerous enterprises and

establishments, which previously to the formation of the combination were

carried on separately.

It is universally conceded that combinations which engross or control the

market of any particular kind of merchandise or commodity necessary to the

general community, by suppressing natural and ordinary competition, whereby

prices are unduly enhanced to the general consumer, are obnoxious not only

to the common law but also to the public welfare. There must be a remedy

for the evils involved in such organizations. If the present law can be

extended more certainly to control or check these monopolies or trusts, it

should be done without delay. Whatever power the Congress possesses over

this most important subject should be promptly ascertained and asserted.

President Harrison in his annual message of December 3, 1889, says: Earnest

attention should be given by Congress to a consideration of the question

how far the restraint of those combinations of capital commonly called

"trusts" is matter of Federal jurisdiction. When organized, as they often

are, to crush out all healthy competition and to monopolize the production

or sale of an article of commerce and general necessity they are dangerous

conspiracies against the public good, and should be made the subject of

prohibitory and even penal legislation. An act to protect trade and

commerce against unlawful restraints and monopolies was passed by Congress

on the 2d of July, 1890. The provisions of this statute are comprehensive

and stringent. It declares every contract or combination, in the form of a

trust or otherwise, or conspiracy in the restraint of trade or commerce

among the several States or with foreign nations, to be unlawful. It

denominates as a criminal every person who makes any such contract or

engages in any such combination or conspiracy, and provides a punishment by

fine or imprisonment. It invests the several circuit courts of the United

States with jurisdiction to prevent and restrain violations of the act, and

makes it the duty of the several United States district attorneys, under

the direction of the Attorney General, to institute proceedings in equity

to prevent and restrain such violations. It further confers upon any person

who shall be injured in his business or property by any other person or

corporation by reason of anything forbidden or declared to be unlawful by

the act, the power to sue therefore in any circuit court of the United

States without respect to the amount in controversy, and to recover

threefold the damages by him sustained and the costs of the suit, including

reasonable attorney fees. It will be perceived that the act is aimed at

every kind of combination in the nature of a trust or monopoly in restraint

of interstate or international commerce.

The prosecution by the United States of offenses under the act of 1890 has

been frequently resorted to in the Federal courts, and notable efforts in

the restraint of interstate commerce, such as the Trans-Missouri Freight

Association and the joint Traffic Association, have been successfully

opposed and suppressed.

President Cleveland in his annual message of December 7, 1896--more than

six years subsequent to the enactment of this law--after stating the

evils of these trust combinations, says: Though Congress has attempted to

deal with this matter by legislation, the laws passed for that purpose thus

far have proved ineffective, not because of any lack of disposition or

attempt to enforce them, but simply because the laws themselves as

interpreted by the courts do not reach the difficulty. If the

insufficiencies of existing laws can be remedied by further legislation, it

should be done. The fact must be recognized, however, that all Federal

legislation on this subject may fall short of its purpose because of

inherent obstacles, and also because of the complex character of our

governmental system, which, while making the Federal authority supreme

within its sphere, has carefully limited that sphere by metes and bounds

which cannot be transgressed. The decision of our highest court on this

precise question renders it quite doubtful whether the evils of trusts and

monopolies may be adequately treated through Federal action, unless they

seek directly and purposely to include in their objects transportation or

intercourse between States or between the United States and foreign

countries. It does not follow, however, that this is the limit of the

remedy that may be applied. Even though it may be found that Federal

authority is not broad enough to fully reach the case, there can be no

doubt of the power of the several States to act effectively in the

premises, and there should be no reason to doubt their willingness to

judiciously exercise such power. The State legislation to which President

Cleveland looked for relief from the evils of trusts has failed to

accomplish fully that object. This is probably due to a great extent to the

fact that different States take different views as to the proper way to

discriminate between evil and injurious combinations and those associations

which are beneficial and necessary to the business prosperity of the

country. The great diversity of treatment in different States arising from

this cause and the intimate relations of all parts of the country to each

other without regarding State lines in the conduct of business have made

the enforcement of State laws difficult.

It is apparent that uniformity of legislation upon this subject in the

several States is much to be desired. It is to be hoped that such

uniformity founded in a wise and just discrimination between what is

injurious and what is useful and necessary in business operations may be

obtained and that means may be found for the Congress within the

limitations of its constitutional power so to supplement an effective code

of State legislation as to make a complete system of laws throughout the

United States adequate to compel a general observance of the salutary rules

to which I have referred.

The whole question is so important and far-reaching that I am sure no part

of it will be lightly considered, but every phase of it will have the

studied deliberation of the Congress, resulting in wise and judicious

action.

A review of our relations with foreign States is presented with such

recommendations as are deemed appropriate.

The long-pending boundary dispute between the Argentine Republic and Chile

was settled in March last by the award of an arbitral commission, on which

the United States minister at Buenos Ayres served as umpire.

Progress has been made toward the conclusion of a convention of extradition

with the Argentine Republic. Having been advised and consented to by the

United States Senate and ratified by Argentina, it only awaits the

adjustment of some slight changes in the text before exchange.

In my last annual message I adverted to the claim of the Austro-Hungarian

Government for indemnity for the killing of certain Austrian and Hungarian

subjects by the authorities of the State of Pennsylvania, at Lattimer,

while suppressing an unlawful tumult of miners, September 10, 1897. In view

of the verdict of acquittal rendered by the court before which the sheriff

and his deputies were tried for murder, and following the established

doctrine that the Government may not be held accountable for injuries

suffered by individuals at the hands of the public authorities while acting

in the line of duty in suppressing disturbance of the public peace, this

Government, after due consideration of the claim advanced by the

Austro-Hungarian Government, was constrained to decline liability to

indemnify the sufferers.

It is gratifying to be able to announce that the Belgian Government has

mitigated the restrictions on the importation of cattle from the United

States, to which I referred in my last annual message.

Having been invited by Belgium to participate in a congress, held at

Brussels, to revise the provisions of the general act Of July 2, 1890, for

the repression of the African slave trade, to which the United States was a

signatory party, this Government preferred not to be represented by a

plenipotentiary, but reserved the right of accession to the result. Notable

changes were made, those especially concerning this country being in the

line of the increased restriction of the deleterious trade in spirituous

liquors with the native tribes, which this Government has from the outset

urgently advocated. The amended general act will be laid before the Senate,

with a view to its advice and consent.

Early in the year the peace of Bolivia was disturbed by a successful

insurrection. The United States minister remained at his post, attending to

the American interests in that quarter, and using besides his good offices

for the protection of the interests of British subjects in the absence of

their national representative. On the establishment of the new Government,

our minister was directed to enter into relations therewith.

General Pando was elected President of Bolivia on October 23.

Our representative has been instructed to use all permissible friendly

endeavors to induce the Government of Bolivia to amend its marriage laws so

as to give legal status to the non-Catholic and civil marriages of aliens

within its jurisdiction, and strong hopes are entertained that the Bolivian

law in this regard will be brought, as was that of Peru some years ago,

into harmony with the general practice of modern States.

A convention of extradition with Brazil, signed May 14, 1897, has been

ratified by the Brazilian Legislature.

During the past summer two national ships of the United States have visited

Brazilian ports on a friendly mission and been cordially received. The

voyage of the Wilmington up the Amazon River gave rise to a passing

misunderstanding, owing to confusion in obtaining permission to visit the

interior and make surveys in the general interest of navigation, but the

incident found a ready adjustment in harmony with the close relations of

amity which this Government has always sedulously sought to cultivate with

the commonwealths of the Western Continent.

The claim growing out of the seizure of the American-owned newspaper "The

Panama Star and Herald" by the authorities of Colombia has been settled,

after a controversy of several years, by an agreement assessing at $30,000

the indemnity to be paid by the Colombian Government, in three installments

of $10,000 each.

The good will of Colombia toward our country has been testified anew by the

cordial extension of facilities to the Nicaraguan Canal Commission in their

approaching investigation of the Panama Canal and other projected routes

across the Isthmus of Darien.

Toward the end of October an insurrectionary disturbance developed in the

Colombian Republic. This movement has thus far not attained any decisive

result and is still in progress.

Discussion of the questions raised by the action of Denmark in imposing

restrictions on the importation of American meats has continued without

substantial result in our favor.

The neighboring island Republic of Santo Domingo has lately been the scene

of revolution, following a long period of tranquility. It began with the

killing of President Heureaux in July last, and culminated in the

relinquishment by the succeeding Vice-President of the reins of government

to the insurgents. The first act of the provisional government was the

calling of a presidential and constituent election. Juan Isidro Jimenez,

having been elected President, was inaugurated on the 14th of November.

Relations have been entered into with the newly established Government.

The experimental association of Nicaragua, Honduras, and Salvador, tinder

the title of the Greater Republic of Central America, when apparently on

the threshold of a complete federal organization by the adoption of a

constitution and the formation of a national legislature, was disrupted in

the last days of November, 1898, by the withdrawal of Salvador. Thereupon

Nicaragua and Honduras abandoned the joint compact, each resuming its

former independent sovereignty. This was followed by the reception of

Minister Merry by the Republics of Nicaragua and Salvador, while Minister

Hunter in turn presented his credentials to the Government of Honduras,

thus reverting to the old distribution of the diplomatic agencies of the

United States in Central America for which our existing statutes provide. A

Nicaraguan envoy has been accredited to the United States.

An insurrectionary movement, under General Reyes, broke out at Bluefields

in February last, and for a time exercised actual control in the Mosquito

Territory. The Detroit was promptly sent thither for the protection of

American interests. After a few weeks the Reyes government renounced the

conflict, giving place to the restored supremacy of Nicaragua. During the

interregnum certain public dues accruing under Nicaraguan law were

collected from American merchants by the authorities for the time being in

effective administrative control. Upon the titular government regaining

power, a second payment of these dues was demanded. Controversy arose

touching the validity of the original payment of the debt to the de facto

regent of the territory. An arrangement was effected in April last by the

United States minister and the foreign secretary of Nicaragua whereby the

amounts of the duplicate payments were deposited with the British consul

pending an adjustment of the matter by direct agreement between the

Governments of the United States and Nicaragua. The controversy is still

unsettled.

The contract of the Maritime Canal Company of Nicaragua was declared

forfeited by the Nicaraguan Government on the Tenth of October, on the

ground of nonfulfillment within the ten years' term stipulated in the

contract. The Maritime Canal Company has lodged a protest against this

action, alleging rights in the premises which appear worthy of

consideration. This Government expects that Nicaragua will afford the

protestants a full and fair hearing upon the merits of the case.

The Nicaragua Canal Commission, which had been engaged upon the work of

examination and survey for a ship-canal route across Nicaragua, having

completed its labors and made its report, was dissolved on May P, and on

June To a new commission, known as the Isthmian Canal Commission, was

organized under the terms of the act approved March 3, 1899, for the

purpose of examining the American Isthmus with a view to determining the

most practicable and feasible route for a ship canal across that Isthmus,

with its probable cost, and other essential details.

This Commission, under the presidency of Rear-Admiral John G. Walker, U. S.

N. (retired), entered promptly upon the work intrusted to it, and is now

carrying on examinations in Nicaragua along the route of the Panama Canal,

and in Darien from the Atlantic, in the neighborhood of the Atrato River,

to the Bay of Panama, on the Pacific side. Good progress has been made, but

under the law a comprehensive and complete investigation is called for,

which will require much labor and considerable time for its accomplishment.

The work will be prosecuted as expeditiously as possible and a report made

at the earliest practicable date.

The great importance of this work cannot be too often or too strongly

pressed upon the attention of the Congress. In my message of a year ago I

expressed my views of the necessity of a canal which would link the two

great oceans, to which I again invite your consideration. The reasons then

presented for early action are even stronger now.

A pleasing incident in the relations of this Government with that of Chile

occurred in the generous assistance given to the war ship Newark when in

distress in Chilean waters. Not alone in this way has the friendly

disposition of Chile found expression. That country has acceded to the

convention for the establishment of the Bureau of the American Republics,

in which organization every independent State of the continent now shares.

The exchange of ratifications of a convention for the revival of the United

States and Chilean Claims Commission and for the adjudication of claims

heretofore presented but not determined during the life of the previous

Commission has been delayed by reason of the necessity for fresh action by

the Chilean Senate upon the amendments attached to the ratification of the

treaty by the United States Senate. This formality is soon to be

accomplished.

In view of disturbances in the populous provinces of northern China, where

are many of our citizens, and of the imminence of disorder near the capital

and toward the seaboard, a guard of marines was landed from the Boston and

stationed during last winter in the legation compound at Peking. With the

restoration of order this protection was withdrawn.

The interests of our citizens in that vast Empire have not been neglected

during the past year. Adequate protection has been secured for our

missionaries and some injuries to their property have been redressed.

American capital has sought and found various opportunities of competing to

carry out the internal improvements which the Imperial Government is wisely

encouraging, and to develop the natural resources of the Empire. Our trade

with China has continued to grow, and our commercial rights under existing

treaties have been everywhere maintained during the past year, as they will

be in the future.

The extension of the area open to international foreign settlement at

Shanghai and the opening of the ports of Nanking, Tsing-tao (Kiao chao),

and Ta-lien-wan to foreign trade and settlement will doubtless afford

American enterprise additional facilities and new fields, of which it will

not be slow to take advantage.

In my message to Congress of December 5, 1898, I urged that the

recommendation which had been made to the Speaker of the House of

Representatives by the Secretary of the Treasury on the 14th of June, 1898,

for an appropriation for a commission to study the commercial and

industrial conditions in the Chinese Empire and report as to the

opportunities for, and obstacles to, the enlargement of markets in China

for the raw products and manufactures of the United States, should receive

at your hands the consideration which its importance and timeliness

merited, but the Congress failed to take action.

I now renew this recommendation, as the importance of the subject has

steadily grown since it was first submitted to you, and no time should be

lost in studying for ourselves the resources of this great field for

American trade and enterprise.

The death of President Faure in February last called forth those sincere

expressions of sympathy which befit the relations of two Republics as

closely allied by unbroken historic ties as are the United States and

France.

Preparations for the representation of the industries, arts, and products

of the United States at the World's Exposition to be held in Paris next

year continue on an elaborate and comprehensive scale, thanks to the

generous appropriation provided by Congress and to the friendly interest

the French Government has shown in furthering a typical exhibit of American

progress.

There has been allotted to the United States a considerable addition of

space, which, while placing our country in the first rant among exhibitors,

does not suffice to meet the increasingly urgent demands of our

manufacturers. The efforts of the Commissioner General are ably directed

toward a strictly representative display of all that most

characteristically marks American achievement in the inventive arts, and

most adequately shows the excellence of our natural productions.

In this age of keen rivalry among nations for mastery in commerce, the

doctrine of evolution and the rule of the survival of the fittest must be

as inexorable in their operation as they are positive in the results they

bring about. The place won in the struggle by an industrial people can only

be held by unrelaxed endeavor and constant advance in achievement. The

present extraordinary impetus in every line of American exportation and the

astounding increase in the volume and value of our share in the world's

markets may not be attributed to accidental conditions.

The reasons are not far to seek. They lie deep in our national character

and find expression year by year in every branch of handicraft, in every

new device whereby the materials we so abundantly produce are subdued to

the artisan's will and made to yield the largest, most practical, and most

beneficial return. The American exhibit at Paris should, and I am confident

will, be an open volume, whose lessons of skillfully directed endeavor,

unfaltering energy, and consummate performance may be read by all on every

page, thus spreading abroad a clearer knowledge of the worth of our

productions and the justice of our claim to an important place in the marts

of the world. To accomplish this by judicious selection, by recognition of

paramount merit in whatever walk of trade or manufacture it may appear, and

by orderly classification and attractive installation is the task of our

Commission.

The United States Government building is approaching completion, and no

effort will be spared to make it worthy, in beauty of architectural plan

and in completeness of display, to represent our nation. It has been

suggested that a permanent building of similar or appropriate design be

erected on a convenient site, already given by the municipality, near the

exposition grounds, to serve in commemoration of the part taken by this

country in this great enterprise, as an American National Institute, for

our countrymen resorting to Paris for study.

I am informed by our Commissioner-General that we shall have in the

American sections at Paris over 7,000 exhibitors, from every State ill our

country, a number ten times as great as those which were represented at

Vienna in 1873, six times as many as those in Paris in 1878, and four times

as many as those who exhibited in Paris in 1889. This statement does not

include the exhibits from either Cuba, Puerto Rico, or Hawaii, for which

arrangements have been made.

A number of important international congresses on special topics affecting

public interests are proposed to be held in Paris next summer in connection

with the exposition. Effort will be made to have the several technical

branches of our administration efficiently represented at those

conferences, each in its special line, and to procure the largest possible

concourse of State representatives, particularly at the Congresses of

Public Charity and Medicine.

Our relations with Germany continue to be most cordial. The increasing

intimacy of direct association has been marked during the year by the

granting permission in April for the landing on our shores of a cable from

Borkum Emden, on the North Sea, by way of the Azores, and also by the

conclusion on September 2 of a Parcels Post Convention with the German

Empire. In all that promises closer relations of intercourse and commerce

and a better understanding between two races having so many traits in

common, Germany can be assured of the most cordial cooperation of this

Government and people. We may be rivals in many material paths, but our

rivalry should be generous and open, ever aiming toward the attainment of

larger results and the mutually beneficial advancement of each in the line

of its especial adaptabilities.

The several governments of the Empire seem reluctant to admit the natural

excellence of our food productions and to accept the evidence we constantly

tender of the care with which their purity is guarded by rigid inspection

from the farm, through the slaughterhouse and the packing establishments,

to the port of shipment. Our system of control over exported food staples

invites examination from any quarter and challenges respect by its

efficient thoroughness.

It is to be hoped that in time the two Governments will act in common

accord toward the realization of their common purpose to safeguard the

public health and to insure the purity and wholesomeness of all food

products imported by either country from the other. Were the Congress to

authorize an invitation to Germany, in connection with the pending

reciprocity negotiations, for the constitution of a joint commission of

scientific experts and practical men of affairs to conduct a searching

investigation of food production and exportation in both countries and

report to their respective legislatures for the adoption of such remedial

measures as they might recommend for either, the way might be opened for

the desirable result indicated.

Efforts to obtain for American life insurance companies a full hearing as

to their business operations in Prussia have, after several years of

patient representation, happily succeeded, and one of the most important

American companies has been granted a concession to continue business in

that Kingdom.

I am also glad to announce that the German insurance companies have been

readmitted by the superintendent of insurance to do business in the State

of New York.

Subsequent to the exchange of our peace treaty with Spain, Germany acquired

the Caroline Islands by purchase, paying therefore $5,000,000. Assurances

have been received from the German Government that the rights of American

missionaries and traders there will be considerately observed.

In my last annual message I referred to the pending negotiations with Great

Britain in respect to the Dominion of Canada. By means of an executive

agreement, a joint High Commission had been created for the purpose of

adjusting all unsettled questions between the United States and Canada,

embracing twelve subjects, among which were the questions of the fur seals,

the fisheries of the coast and contiguous inland waters, the Alaskan

boundary, the transit of merchandise in bond, the alien labor laws, mining

rights, reciprocity in trade, revision of the agreement respecting naval

vessels in the Great Lakes, a more complete marking of parts of the

boundary, provision for the conveyance of criminals, and for wrecking and

salvage.

Much progress had been made by the Commission toward the adjustment of many

of these questions, when it became apparent that an irreconcilable

difference of views was entertained respecting the delimitation of the

Alaskan, boundary. In the failure of an agreement as to the meaning of

Articles III and IV of the treaty of 1825 between Russia and Great Britain,

which defined the boundary between Alaska and Canada, the American

Commissioners proposed that the subject of the boundary be laid aside, and

that the remaining questions of difference be proceeded with, some of which

were so far advanced as to assure the probability of a settlement. This

being declined by the British Commissioners, an adjournment was taken until

the boundary should be adjusted by the two Governments. The subject has

been receiving the careful attention which its importance demands, with the

result that a modus vivendi for provisional demarcations in the region

about the head of Lynn Canal has, been agreed upon; and it is hoped that

the negotiations now in progress between the two Governments will end in an

agreement for the establishment and delimitation of a permanent boundary.

Apart from these questions growing out of our relationship with our

northern neighbor, the most friendly disposition and ready agreement have

marked the discussion of numerous matters arising in the vast and intimate

intercourse of the United States with Great Britain.

This Government has maintained an attitude of neutrality in the unfortunate

contest between Great Britain and the Boer States of Africa. We have

remained faithful to the precept of avoiding entangling alliances as to

affairs not of our direct concern. Had circumstances suggested that the

parties to the quarrel would have welcomed any kindly expression of the

hope of the American people that war might be averted, good offices would

have been gladly tendered. The United States representative at Pretoria was

early instructed to see that all neutral American interests be respected by

the combatants. This has been an easy task in view of the positive

declarations of both British and Boer authorities that the personal and

property rights of our citizens should be observed.

Upon the withdrawal of the British agent from Pretoria the United States

consul was authorized, upon the request of the British Government and with

the assent of the South African and Orange Free State Governments, to

exercise the customary good offices of a neutral for the care of British

interests. In the discharge of this function, I am happy to say that

abundant opportunity has been afforded to show the impartiality of this

Government toward both the combatants.

For the fourth time in the present decade, question has arisen with the

Government of Italy in regard to the lynching of Italian subjects. The

latest of these deplorable events occurred at Tallulah, Louisiana, whereby

five unfortunates of Italian origin were taken from jail and hanged.

The authorities of the State and a representative of the Italian Embassy

having separately investigated the occurrence, with discrepant results,

particularly as to the alleged citizenship of the victims, and it not

appearing that the State had been able to discover and punish the violators

of the law, an independent investigation has been set on foot, through the

agency of the Department of State, and is still in progress. The result

will enable the Executive to treat the question with the Government of

Italy in a spirit of fairness and justice. A satisfactory solution will

doubtless be reached.

The recurrence of these distressing manifestations of blind mob fury

directed at dependents or natives of a foreign country suggests that the

contingency has arisen for action by Congress in the direction of

conferring upon the Federal courts jurisdiction in this class of

international cases where the ultimate responsibility of the Federal

Government may be involved. The suggestion is not new. In his annual

message of December 9, 1891, my predecessor, President Harrison, said: It

would, I believe, be entirely competent for Congress to make offenses

against the treaty rights of foreigners domiciled in the United States

cognizable in the Federal courts. This has not, however, been done, and the

Federal officers and courts have no power in such cases to intervene either

for the protection of a foreign citizen or for the punishment of his

slayers. It seems to me to follow, in this state of the law, that the

officers of the State charged with police and judicial powers in such cases

must, in the consideration of international questions growing out of such

incidents, be regarded in such sense as Federal agents as to make this

Government answerable for their acts in cases where it would be answerable

if the United States had used its constitutional power to define and punish

crimes against treaty rights. A bill to provide for the punishment of

violations of treaty rights of aliens was introduced in the Senate March 1,

1892, and reported favorably March 30. Having doubtless in view the

language of that part of Article III of the treaty of February 26, 1871,

between the United States and Italy, which stipulates that "The citizens

of each of the high contracting parties shall receive, in the States and

Territories of the other, most constant protection and security for their

persons and property, and shall enjoy in this respect the same rights and

privileges as are or shall be granted to the natives, on their submitting

themselves to the conditions imposed upon the natives," the bill so

introduced and reported provided that any act committed in any State or

Territory of the United States in violation of the rights of a citizen or

subject of a foreign country secured to such citizen or subject by treaty

between the United States and such foreign country and constituting a crime

under the laws of the State or Territory shall constitute a like crime

against the United States and be cognizable in the Federal courts. No

action was taken by Congress in the matter.

I earnestly recommend that the subject be taken up anew and acted upon

during the present session. The necessity for some such provision

abundantly appears. Precedent for constituting a Federal jurisdiction in

criminal cases where aliens are sufferers is rationally deducible from the

existing statute, which gives to the district and circuit courts of the

United States jurisdiction of civil suits brought by aliens where the

amount involved exceeds a certain sum. If such jealous solicitude be shown

for alien rights in cases of merely civil and pecuniary import, how much

greater should be the public duty to take cognizance of matters affecting

the lives and the rights of aliens tinder the settled principles of

international law no less than under treaty stipulation, in cases of such

transcendent wrong-doing as mob murder, especially when experience has

shown that local justice is too often helpless to punish the offenders.

After many years of endeavor on the part of this Government to that end the

Italian Government has consented to enter into negotiations for a

naturalization convention, having for one of its objects the regulation of

the status of Italians (except those of an age for active military service)

who, having been naturalized in the United States, may revisit Italy. It is

hoped that with the mutually conciliatory spirit displayed a successful

conclusion will be reached.

The treaty of commerce and navigation between the United States and Japan

on November 22, 1894, took effect in accordance with the terms of its XIXth

Article on the 17th of July last, simultaneously with the enforcement of

like treaties with the other powers, except France, whose convention did

not go into operation until August 4, the United States being, however,

granted up to that date all the privileges and rights accorded to French

citizens under the old French treaty. By this notable conventional reform

Japan's position as a fully independent sovereign power is assured, control

being gained of taxation, customs revenues, judicial administration,

coasting trade, and all other domestic functions of government, and foreign

extra-territorial rights being renounced.

Comprehensive codes of civil and criminal procedure according to western

methods, public instruction, patents and copyrights, municipal

administration, including jurisdiction over the former foreign settlements,

customs tariffs and procedure, public health, and other administrative

measures have been proclaimed. The working of the new system has given rise

to no material complaints on the part of the American citizens or

interests, a circumstance which attests the ripe consideration with which

the change has been prepared.

Valuable assistance was rendered by the Japanese authorities to the United

States transport ship Morgan City while stranded at Kobe. Permission has

been granted to land and pasture army horses at Japanese ports of call on

the way to the Philippine Islands. These kindly evidences of good will are

highly appreciated.

The Japanese Government has shown a lively interest in the proposition of

the Pacific Cable Company to add to its projected cable lines to Hawaii,

Guam, and the Philippines a branch connection with the coast of Japan. It

would be a gratifying consummation were the utility of the contemplated

scheme enhanced by bringing Japan and the United States into direct

telegraphic relation.

Without repeating the observations of my special message of February 10,

1899, concerning the necessity of a cable to Manila. I respectfully invite

attention to it.

I recommend that, in case the Congress should not take measures to bring

about this result by direct action of the Government, the Postmaster

General be authorized to invite competitive bids for the establishment of a

cable; the company making the best responsible bid to be awarded the

contract; the successful company to give ample bonds to insure the

completion of the work within a reasonable time.

The year has been marked by constant increase in the intimacy of our

relations with Mexico and in the magnitude of mutually advantageous

interchanges. This Government has omitted no opportunity to show its strong

desire to develop and perpetuate the ties of cordiality now so long happily

unbroken.

Following the termination on January 20, 1899, by Mexico of the convention

of extradition of December 11, 1861, a new treaty more in accordance with

the ascertained needs of both countries was signed February 22, 1899, and

exchanged in the City of Mexico on the 22d of April last. Its operation

thus far has been effective and satisfactory. A recent case has served to

test the application of its IVth Article, which provides that neither party

shall be bound to deliver up its own citizens, but that the executive

authority of each shall have the power to deliver them up if in its

discretion it be deemed proper to do so.

The extradition of Mrs. Mattie Rich, a citizen of the United States,

charged with homicide committed in Mexico, was after mature consideration

directed by me in the conviction that the ends of justice would be thereby

subserved. Similar action, on appropriate occasion, by the Mexican

Executive will not only tend to accomplish the desire of both Governments

that grave crimes go not unpunished, but also to repress lawlessness along

the border of the two countries. The new treaty stipulates that neither

Government shall assume jurisdiction in the punishment of crimes committed

exclusively within the territory of the other. This will obviate in future

the embarrassing controversies which have heretofore arisen through

Mexico's assertion of a claim to try and punish an American citizen for an

offense committed within the jurisdiction of the United States.

The International Water Boundary Commission, organized by the convention of

March 1, 1889, for the adjustment of questions affecting the Rio Grande

frontier, has not yet completed its labors. A further extension of its term

for one year, until December 24, 1899, was effected by a convention signed

December z, 1898, and exchanged and proclaimed in February last.

An invitation extended to the President of Mexico to visit Chicago in

October, on the occasion of laying the corner stone of the United States

Government building in that city, was cordially accepted by him, with the

necessary consent of the Mexican Congress, but the illness of a member of

his family prevented his attendance. The Minister of Foreign Relations,

however, came as the personal representative of President Diaz, and in that

high character was duly honored.

Claims growing out of the seizure of American sealing vessels in Bering Sea

have been under discussion with the Government of Russia for several years,

with the recent happy result of an agreement to submit them to the decision

of a single arbitrator. By this act Russia affords proof of her adherence

to the beneficent principle of arbitration which her plenipotentiaries

conspicuously favored at The Hague Disarmament Conference when it was

advocated by the representatives of the United States.

A suggestion for a permanent exposition of our products and manufactures in

Russia, although not yet fully shaped, has been so cordially welcomed by

the Imperial Government that it may not inaptly take a fitting place in

whatever legislation the Congress may adopt looking to enlargement of our

commercial opportunities abroad.

Important events have occurred in the Samoan Islands. The election,

according to the laws and customs of Samoa, of a successor to the late

King, Malietoa Laupepa, developed a contest as to the validity of the

result, which issue, by the terms of the General Act, was to be decided by

the Chief justice. Upon his rendering a judgment in favor of Malietoa Tanu,

the rival chief, Mataafa, took up arms. The active intervention of American

and British war ships became imperative to restore order, at the cost of

sanguinary encounters. In this emergency a joint commission of

representatives of the United States, Germany, and Great Britain was sent

to Samoa to investigate the situation and provide a temporary remedy. By

its active efforts a peaceful solution was reached for the time being, the

kingship being abolished and a provisional government established.

Recommendations unanimously made by the commission for a permanent

adjustment of the Samoan question were taken under consideration by the

three powers parties to the General Act. But the more they were examined

the more evident it became that a radical change was necessary in the

relations of the powers to Samoa.

The inconveniences and possible perils of the tripartite scheme of

supervision and control in the Samoan group by powers having little

interest in common in that quarter beyond commercial rivalry had been once

more emphasized by the recent events. The suggested remedy of the joint

Commission, like the scheme it aimed to replace amounted to what has been

styled a tridominium, being the exercise of the functions of sovereignty by

an unanimous agreement of three powers. The situation had become far more

intricate and embarrassing from every point of view than it was when my

predecessor, in 1894, summed up its perplexities and condemned the

participation in it of the United States.

The arrangement under which Samoa was administered had proved impracticable

and unacceptable to all the powers concerned. To withdraw from the

agreement and abandon the islands to Germany and Great Britain would not be

compatible with our interests in the archipelago. To relinquish our rights

in the harbor of Pago Pago, the best anchorage in the Pacific, the

occupancy of which had been leased to the United States in 1878 by the

first foreign treaty ever concluded by Samoa, was not to be thought of

either as regards the needs of our Navy or the interests of our growing

commerce with the East. We could not have considered any proposition for

the abrogation of the tripartite control which did not confirm us in all

our rights and safeguard all our national interests in the islands.

Our views commended themselves to the other powers. A satisfactory

arrangement was concluded between the Governments of Germany and of

England, by virtue of which England retired from Samoa in view of

compensations in other directions, and both powers renounced in favor of

the United States all their rights and claims over and in respect to that

portion of the group lying to the east of the one hundred and seventy-first

degree of west longitude, embracing the islands of Tutuila, Ofoo, Olosenga,

and Manua. I transmit to the Senate, for its constitutional action thereon,

a convention, which besides the provisions above mentioned also guarantees

us the same privileges and conditions in respect to commerce and commercial

vessels in all of the islands of Samoa as those possessed by Germany.

Claims have been preferred by white residents of Samoa on account of

injuries alleged to have been suffered through the acts of the treaty

Governments in putting down the late disturbances. A convention has been

made between the three powers for the investigation and settlement of these

claims by a neutral arbitrator, to which the attention of the Senate will

be invited.

My annual message of last year was necessarily devoted, in great part to a

consideration of the Spanish War and of the results it wrought and the

conditions it imposed for the future. I am gratified to announce that the

treaty of peace has restored friendly relations between the two powers.

Effect has been given to its most important provisions. The evacuation of

Puerto Rico having already been accomplished on the XIVth of October, 1898,

nothing remained necessary there but to continue the provisional military

control of the island until the Congress should enact a suitable government

for the ceded territory. Of the character and scope of the measures to that

end I shall treat in another part of this message.

The withdrawal of the authority of Spain from the island of Cuba was

effected by the 1st of January, so that the full re-establishment of peace

found the relinquished territory held by us in trust for the inhabitants,

maintaining, under the direction of the Executive, such government and

control therein as should conserve public order, restore the productive

conditions of peace so long disturbed by the instability and disorder which

prevailed for the greater part of the preceding three decades, and build up

that tranquil development of the domestic state whereby alone can be

realized the high purpose, as proclaimed in the joint resolution adopted by

the Congress on the 19th of April, 1898, by which the United States

disclaimed any disposition or intention to exercise sovereignty,

jurisdiction, or control over Cuba, except for the pacification thereof,

and asserted its determination when that was accomplished to leave the

government and control of the island to its people. The pledge contained in

this resolution is of the highest honorable obligation and must be sacredly

kept.

I believe that substantial progress has been made in this direction. All

the administrative measures adopted in Cuba have aimed to fit it for a

regenerated existence by enforcing the supremacy of law and justice; by

placing wherever practicable the machinery of administration in the hands

of the inhabitants; by instituting needed sanitary reforms; by spreading

education; by fostering industry and trade; by inculcating public morality,

and, in short, by taking every rational step to aid the Cuban people to

attain to that plane of self-conscious respect and self-reliant unity which

fits an enlightened community for self-government within its own sphere,

while enabling it to fulfill all outward obligation.

This nation has assumed before the world a grave responsibility for the

future good government of Cuba. We have accepted a trust the fulfillment of

which calls for the sternest integrity of purpose and the exercise of the

highest wisdom. The new Cuba yet to arise from the ashes of the past must

needs be bound to us by ties of singular intimacy and strength if its

enduring welfare is to be assured. Whether those ties shall be organic or

conventional, the destinies of Cuba are in some rightful form and manner

irrevocably linked with our own, but how and how far is for the future to

determine in the ripeness of events. Whatever be the outcome, we must see

to it that free Cuba be a reality, not a name, a perfect entity, not a

hasty experiment bearing within itself the elements of failure. Our

mission, to accomplish which we took up the wager of battle, is not to be

fulfilled by turning adrift any loosely framed commonwealth to face the

vicissitudes which too often attend weaker States whose natural wealth and

abundant resources are offset by the incongruities of their political

organization and the recurring occasions for internal rivalries to sap

their strength and dissipate their energies. The greatest blessing which

can come to Cuba is the restoration of her agricultural and industrial

prosperity, which will give employment to idle men and re-establish the

pursuits of peace. This is her chief and immediate need.

On the 19th of August last an order was made for the taking of the census

in the island, to be completed on the 30th of November. By the treaty of

peace the Spanish people on the island have until April 11, 1900, to elect

whether they will remain citizens of Spain or become citizens of Cuba.

Until then it cannot be definitely ascertained who shall be entitled to

participate in the formation of the government of Cuba. By that time the

results of the census will have been tabulated and we shall proceed to

provide for elections which will commit the municipal governments of the

island to the officers elected by the people. The experience thus acquired

will prove of great value in the formation of a representative convention

of the people to draft a constitution and establish a general system of

independent government for the island. In the meantime and so long as we

exercise control over the island the products of Cuba should have a market

in the United States on as good terms and with as favorable rates of duty

as are given to the West India Islands under treaties of reciprocity which

shall be made.

For the relief of the distressed in the island of Cuba the War Department

has issued supplies to destitute persons through the officers of the Army,

which have amounted to 5,493,000 rations, at a cost Of $1,417,554.07.

To promote the disarmament of the Cuban volunteer army, and in the interest

of public peace and the welfare of the people, the sum Of $75 was paid to

each Cuban soldier borne upon the authenticated rolls, on condition that he

should deposit his arms with the authorities designated by the United

States. The sum thus disbursed aggregated $2,547,750, which was paid from

the emergency fund provided by the act of January 5, 1899, for that

purpose.

Out of the Cuban island revenues during the six months ending June 30,

1899, $1,712,014.20 was expended for sanitation, $293,881.70 for charities

and hospitals, and $88,944.03 for aid to the destitute.

Following the exchange of ratifications of the treaty of peace the two

Governments accredited ministers to each other, Spain sending to Washington

the Duke of Arcos, an eminent diplomatist, previously stationed in Mexico,

while the United States transferred to Madrid Hon. Bellamy Storer, its

minister at Brussels. This was followed by the respective appointment of

consuls, thereby fully resuming the relations interrupted by the war. In

addition to its consular representation in the United States, the Spanish

Government has appointed consuls for Cuba, who have been provisionally

recognized during the military administration of the affairs of that

island.

Judicial intercourse between the courts of Cuba and Puerto Rico and of

Spain has been established, as provided by the treaty of peace. The Cuban

political prisoners in Spanish penal stations have been and are being

released and returned to their homes, in accordance with Article VI of the

treaty. Negotiations are about to be had for defining the conventional

relations between the two countries, which fell into abeyance by reason of

the war. I trust that these will include a favorable arrangement for

commercial reciprocity under the terms of sections 3 and 4 of the current

tariff act. In these, as in all matters of international concern, no effort

will be spared to respond to the good disposition of Spain, and to

cultivate in all practicable ways the intimacy which should prevail between

two nations whose past history has so often and in so many ways been marked

by sincere friendship and by community of interests.

I would recommend appropriate legislation in order to carry into execution

Article VII of the Treaty of Peace with Spain, by which the United States

assured the payment of certain claims for indemnity of its citizens against

Spain.

The United States minister to Turkey continues, under instructions, to

press for a money payment in satisfaction of the just claims for injuries

suffered by American citizens in the disorders of several years past and

for wrongs done to them by the Ottoman authorities. Some of these claims

are of many years' standing. This Government is hopeful of a general

agreement in this regard.

In the Turkish Empire the situation of our citizens remains unsatisfactory.

Our efforts during nearly forty years to bring about a convention of

naturalization seem to be on the brink of final failure through the

announced policy of the Ottoman Porte to refuse recognition of the alien

status of native Turkish subjects naturalized abroad since 1867. Our

statutes do not allow this Government to admit any distinction between the

treatment of native and naturalized Americans abroad, so that ceaseless

controversy arises in cases where persons owing in the eye of international

law a dual allegiance are prevented from entering Turkey or are expelled

after entrance. Our law in this regard contrasts with that of the European

States. The British act, for instance, does not claim effect for the

naturalization of an alien in the event of his return to his native

country, unless the change be recognized by the law of that country or

stipulated by treaty between it and the naturalizing State.

The arbitrary treatment, in some instances, of American productions in

Turkey has attracted attention of late, notably in regard to our flour.

Large shipments by the recently opened direct steamship line to Turkish

ports have been denied entrance on the score that, although of standard

composition and unquestioned purity, the flour was pernicious to health

because of deficient "elasticity" as indicated by antiquated and

untrustworthy tests. Upon due protest by the American minister, and it

appearing that the act was a virtual discrimination against our product,

the shipments in question were admitted. In these, as in all instances,

wherever occurring, when American products may be subjected in a foreign

country, upon specious pretexts, to discrimination compared with the like

products of another country, this Government will use its earnest efforts

to secure fair and equal treatment for its citizens and their goods.

Failing this, it will not hesitate to apply whatever corrective may be

provided by the statutes.

The International Commission of Arbitration, appointed under the

Anglo-Venezuelan treaty of 1897, rendered an award on October 3 last,

whereby the boundary line between Venezuela and British Guiana is

determined, thus ending a controversy which has existed for the greater

part of the century. The award, as to which the arbitrators were unanimous,

while not meeting the extreme contention of either party, gives to Great

Britain a large share of the interior territory in dispute and to Venezuela

the entire mouth of the Orinoco, including Barima Point and the Caribbean

littoral for some distance to the eastward. The decision appears to be

equally satisfactory to both parties.

Venezuela has once more undergone a revolution. The insurgents, under

General Castro, after a sanguinary engagement in which they suffered much

loss, rallied in the mountainous interior and advanced toward the capital.

The bulk of the army having sided with the movement, President Andrade

quitted Caracas, where General Castro set up a provisional government with

which our minister and the representatives of other powers entered into

diplomatic relations on the 20th of November, 1899.

The fourth section of the Tariff Act approved July 24, 1897, appears to

provide only for commercial treaties which should be entered into by the

President and also ratified by the Senate within two years from its

passage. Owing to delays inevitable in negotiations of this nature, none of

the treaties initiated under that section could be concluded in time for

ratification by the Senate prior to its adjournment on the 4th of March

last. Some of the pending negotiations, however, were near conclusion at

that time, and the resulting conventions have since been signed by the

plenipotentiaries. Others, within both the third and fourth sections of the

act, are still under consideration. Acting under the constitutional power

of the Executive in respect to treaties, I have deemed it my duty, while

observing the limitations of concession provided by the fourth section, to

bring to a conclusion all pending negotiations, and submit them to the

Senate for its advice and consent.

Conventions of reciprocity have been signed during the Congressional recess

with Great Britain for the respective colonies of British Guiana, Barbados,

Bermuda, Jamaica, and Turks and Caicos Islands, and with the Republic of

Nicaragua.

Important reciprocal conventions have also been concluded with France and

with the Argentine Republic.

In my last annual message the progress noted in the work of the diplomatic

and consular officers in collecting information as to the industries and

commerce of other countries, and in the care and promptitude with which

their reports are printed and distributed, has continued during the past

year, with increasingly valuable results in suggesting new sources of

demand for American products and in pointing out the obstacles still to be

overcome in facilitating the remarkable expansion of our foreign trade. It

will doubtless be gratifying to Congress to learn that the various agencies

of the Department of State are co-operating in these endeavors with a zeal

and effectiveness which are not only receiving the cordial recognition of

our business interests, but are exciting the emulation of other

Governments. In any rearrangement of the great and complicated work of

obtaining official data of an economic character which Congress may

undertake it is most important, in my judgment, that the results already

secured by the efforts of the Department of State should be carefully

considered with a view to a judicious development and increased utility to

our export trade.

The interest taken by the various States forming the International Union of

American Republics in the work of its organic bureau is evidenced by the

fact that for the first time since its creation in 1890 all the Republics

of South and Central America are now represented in it.

The unanimous recommendation of the International American Conference,

providing for the International Union of American Republics, stated that it

should continue in force during a term of ten years from the date of its

organization, and no country becoming a member of the union should cease to

be a member until the end of said period of ten years, and unless twelve

months before the expiration of said period a majority of the members of

the union had given to the Secretary of State of the United States official

notice of their wish to terminate the union at the end of its first period,

that the union should continue to be maintained for another period of ten

years, and thereafter, under the same conditions, for successive periods of

ten years each.

The period for notification expired on July 14, 1899, without any of the

members having given the necessary notice of withdrawal. Its maintenance is

therefore assured for the next ten years. In view of this fact and of the

numerous questions of general interest and common benefit to all of the

Republics of America, some of which were considered by the first

International American Conference, but not finally settled, and others

which have since then grown to importance, it would seem expedient that the

various Republics constituting the Union should be invited to hold at an

early date another conference in the capital of one of the countries other

than the United States, which has already enjoyed this honor.

The purely international character of the work being done by the bureau and

the appreciation of its value are further emphasized by the active

co-operation which the various Governments of the Latin. American Republics

and their diplomatic representatives in this capital are now exhibiting and

the zealous endeavors they are making to extend its field of usefulness, to

promote through it commercial intercourse, and strengthen the bonds of

amity and confidence between its various members and the nations of this

continent.

The act to encourage the holding of the Pan-American Exposition on the

Niagara frontier, within the county of Erie or Niagara, in the State of New

York, in the year 1901, was approved on March 3, 1899.

This exposition, which will be held in the city of Buffalo, in the near

vicinity of the great Niagara cataract, and within a day's journey of which

reside 40, 000, 000 Of our people, will be confined entirely to the Western

Hemisphere. Satisfactory assurances have already been given by the

diplomatic representatives of Great Britain, Mexico, the Central and South

American Republics, and most of the States of the United States that these

countries and States will make an unique, interesting, and instructive

exhibit, peculiarly illustrative of their material progress during the

century which is about to close.

The law provides an appropriation Of $500,000 for the purpose of making an

exhibit at the exposition by the Government of the United States from its

Executive Departments and from the Smithsonian Institution and National

Museum, the United States Commission of Fish and Fisheries, the Department

of Labor, and the Bureau of the American Republics. To secure a complete

and harmonious arrangement of this Government exhibit a board of management

has already been created, and charged with the selection, purchase,

preparation, transportation, arrangement, and safe-keeping of the articles

and materials to be exhibited. This board has been organized and has

already entered upon the performance of its duties, as provided for by the

law.

I have every reason to hope and believe that this exposition will tend more

firmly to cement the cordial relations between the nations on this

continent.

In accordance with an act of Congress approved December 21, 1898, and under

the auspices of the Philadelphia Commercial Museum, a most interesting and

valuable exposition of products and manufactures especially adapted to

export trade was held in Philadelphia from the 14th of September to the 1st

of December, 1899. The representative character of the exhibits and the

widespread interest manifested in the special objects of the undertaking

afford renewed encouragement to those who look confidently to the steady

growth of our enlarged exportation of manufactured goods, which has been

the most remarkable fact in the economic development of the United States

in recent years. A feature of this exposition which is likely to become of

permanent and increasing utility to our industries is the collection of

samples of merchandise produced in various countries with special reference

to particular markets, providing practical object lessons to United States

manufacturers as to qualities, styles, and prices of goods such as meet the

special demands of consumers and may be exported with advantage.

In connection with the exposition an International Commercial Congress was

held, upon the invitation of the Philadelphia Commercial Museum,

transmitted by the Department of State to the various foreign Governments,

for an exchange of information and opinions with the view to the promotion

of international trade. This invitation met with general and cordial

acceptance, and the Congress, which began its sessions at the exposition on

the 13th of October proved to be of great practical importance, from the

fact that it developed a general recognition of the interdependence of

nations in trade and a most gratifying spirit of accommodation with

reference to the gradual removal of existing impediments to reciprocal

relations, without injury to the industrial interests of either party.

In response to the invitation of His Majesty, the Emperor of Russia,

delegates from twenty-six countries were assembled at The Hague on the 18th

of May, as members of a conference in the interest of peace. The commission

from the United States consisted of the Hon. Andrew D. White, the Hon. Seth

Low, the Hon. Stanford Newel, Captain Alfred T. Mahan, of the United States

Navy, Captain William Crozier, of the United States Army, and the Hon.

Frederick W. Holls, secretary. The occasion seemed to be opportune for the

serious consideration of a plan for the pacific adjustment of international

differences, a subject in which the American people have been deeply

interested for many years, and a definite project for a permanent

international tribunal was included in the instructions to the delegates of

the United States.

The final act of the conference includes conventions upon the amelioration

of the laws and customs of war on land, the adaptation to maritime warfare

of the principles of the Geneva Convention of 1864, and the extension of

judicial methods to international cases. The Convention for the Pacific

Settlement of International Conflicts embodies the leading features of the

American plan, with such modifications as were rendered necessary by the

great diversity of views and interests represented by the delegates. The

four titles of the convention provide for the maintenance of general peace,

the exercise of good offices and mediation, the formation of commissions of

inquiry, and international arbitration.

The mediation provided for by the convention is purely voluntary and

advisory, and is intended to avoid any invasion or limitation of the

sovereign rights of the adhering States. The commissions of inquiry

proposed consists of delegations to be specifically constituted for

particular purposes by means of conventions between the contesting parties,

having for their object the clear understanding of international

differences before resorting to the use of force. The provision for

arbitration contemplates the formation of a permanent tribunal before which

disputed cases may be brought for settlement by the mutual consent of the

litigants in each separate case. The advantages of such a permanent

tribunal over impromptu commissions of arbitration are conceived to be the

actual existence of a competent court, prepared to administer justice, the

greater economy resulting from a well-devised system, and the accumulated

judicial skill and experience which such a tribunal would soon possess.

While earnestly promoting the idea of establishing a permanent

international tribunal, the delegation of the United States was not

unmindful of the inconveniences which might arise from an obtrusive

exercise of mediation, and in signing the convention carefully guarded the

historic position of the United States by the following declaration:

Nothing contained in this convention shall be so construed as to require

the United States of America to depart from its traditional policy of not

intruding upon, interfering with, or entangling itself in the political

questions or policy or internal administration of any foreign state; nor

shall anything contained in the said convention be construed to imply a

relinquishment by the United. States of America of its traditional attitude

toward purely American questions. Thus interpreted, the Convention for the

Pacific Settlement of International Conflicts may be regarded as realizing

the earnest desire of great numbers of American citizens, whose deep sense

of justice, expressed in numerous resolutions and memorials, has urged them

to labor for this noble achievement. The general character of this

convention, already signed by the delegates of more than twenty sovereign

States, further commends it to the favorable action of the Senate of the

United States, whose ratification it still awaits.

Since my last annual message, and in obedience to the acts of the Congress

of April 22 and 26, 1898, the remaining volunteer force enlisted for the

Spanish War, consisting Of 34,834 regulars and 110,202 volunteers, with

over 5,000 volunteer officers, has been discharged from the military

service. Of the volunteers, 667 officers and 14,831 men were serving in the

Philippines, and 1,650 of the regulars, who were entitled to be mustered

out after the ratification of the treaty of peace. They voluntarily

remained at the front until their places could be filled by new troops.

They were returned home in the order in which they went to Manila, and are

now all of them out of the service and in the ranks of citizenship. I

recommend that the Congress provide a special medal of honor for the

volunteers, regulars, sailors, and marines on duty in the Philippines who

voluntarily remained in the service after their terms of enlistment had

expired.

By the act of March 2, 1899, Congress gave authority to increase the

Regular Army to a maximum not exceeding 65,000 enlisted men, and to enlist

a force of 5,000 volunteers, to be recruited from the country at large. By

virtue of this authority the Regular Army has been increased to the number

of 61,999 enlisted men and 2,248 officers, and new volunteer regiments have

been organized aggregating 33,050 enlisted men and 1,524 officers. Two of

these volunteer regiments are made up of colored men, with colored line

officers. The new troops to take the places of those returning from the

Philippines have been transported to Manila to the number of 581 officers

and 26,322 enlisted men of the Regular Army and 594 officers and 15,388

enlisted men of the new volunteer force, while 504 officers and 14, 119 men

of the volunteer force are on the ocean en route to Manila.

The force now in Manila consists Of 905 officers and 30,578 regulars, and

594 officers and 15,388 of the volunteers, making an aggregate of 1,499

officers and 45,966 men. When the troops now under orders shall reach

Manila the force in the archipelago will comprise 2,051 officers and 63,483

men. The muster out of the great volunteer army organized for the Spanish

War and the creation of a new army, the transportation from Manila to San

Francisco of those entitled to discharge and the transportation of the new

troops to take their places have been a work of great magnitude well and

ably done, for which too much credit cannot be given the War Department.

During the past year we have reduced our force in Cuba and Puerto Rico, In

Cuba we now have 334 officers and 10,796 enlisted men; In Puerto Rico, 87

officers and 2,855 enlisted men and a battalion of 400 men composed of

native Puerto Ricans; while stationed throughout the United States are 910

officers and 17,317 men, and in Hawaii 12 officers and 453 enlisted men.

The operations of the Army are fully presented in the report of the

Secretary of War. I cannot withhold from officers and men the highest

commendation for their soldierly conduct in trying situations, their

willing sacrifices for their country, and the integrity and ability with

which they have performed unusual and difficult duties in our island

possessions.

In the organization of the volunteer regiments authorized by the act of

March 2, 1899, it was found that no provision had been made for chaplains.

This omission was doubtless from inadvertence. I recommend the early

authorization for the appointment of one chaplain for each of said

regiments. These regiments are now in the Philippines, and it is important

that immediate action be had.

In restoring peaceful conditions, orderly rule, and civic progress in Cuba,

Puerto Rico, and, so far as practicable, in the Philippines, the

rehabilitation of the postal service has been an essential and important

part of the work. It became necessary to provide mail facilities both for

our forces of occupation and for the native population. To meet this

requirement has involved a substantial reconstruction. The existing systems

were so fragmentary, defective, and inadequate that a new and comprehensive

organization had to be created. American trained officials have been

assigned to the directing and executive positions, while natives have been

chiefly employed in making up the body of the force. In working out this

plan the merit rule has been rigorously and faithfully applied.

The appointment of Director-General of Posts of Cuba was given to an expert

who had been Chief Post-Office Inspector and Assistant Postmaster-General,

and who united large experience with administrative capacity. For the

postmastership at Havana the range of skilled and available men was

scanned, and the choice fell upon one who had been twenty years in the

service as deputy postmaster and postmaster of a large city. This principle

governed and determined the selection of the American officials sent not

only to Cuba, but to Puerto Rico and the Philippines, and they were

instructed to apply it so far as practicable in the employment of the

natives as minor postmasters and clerks. The postal system in Cuba, though

remaining under the general guidance of the Postmaster-General, was made

essentially independent. It was felt that it should not be a burden upon

the postal service of the United States, and provision was made that any

deficit in the postal revenue should be a charge upon the general revenues

of the island.

Though Puerto Rico and the Philippines hold a different relation to the

United States, yet, for convenience of administration, the same principle

of an autonomous system has been extended to them. The development of the

service in all of the islands has been rapid and successful. It has moved

forward on American lines, with free delivery, money order, and registry

systems, and has given the people mail facilities far greater and more

reliable than any they have ever before enjoyed. It is thus not only a

vital agency of industrial, social, and business progress, but an important

influence in diffusing a just understanding of the true spirit and

character of American administration.

The domestic postal service continues to grow with extraordinary rapidity.

The expenditures and the revenues will each exceed $100,000,000 during the

current year. Fortunately, since the revival of prosperous times the

revenues have grown much faster than the expenditures, and there is every

indication that a short period will witness the obliteration of the annual

deficit. In this connection the report of the Postmaster-General embodies a

statement of some evils which have grown up outside of the contemplation of

law in the treatment of some classes of mail matter which wrongly exercise

the privilege of the pound rate, and shows that if this matter had been

properly classified and had paid the rate which it should have paid,

instead of a postal deficit for the last fiscal year of $6,610,000, there

would have been on one basis a surplus of $17,637,570, and on another Of

$5,733,836. The reform thus suggested, in the opinion of the

Postmaster-General, would not only put the postal service at once on a

self-sustaining basis, but would permit great and valuable improvements,

and I commend the subject to the consideration of the Congress.

The Navy has maintained the spirit and high efficiency which have always

characterized that service, and has lost none of the gallantry in heroic

action which has signalized its brilliant and glorious past. The Nation has

equal pride in its early and later achievements. Its habitual readiness for

every emergency has won the confidence and admiration of the country. The

people are interested in the continued preparation and prestige of the Navy

and will justify liberal appropriations for its maintenance and

improvement. The officers have shown peculiar adaptation for the

performance of new and delicate duties which our recent war has imposed.

It cannot be doubted that Congress will at once make necessary provision

for the armor plate for the vessels now under contract and building. Its

attention is respectfully called to the report of the Secretary of the

Navy, in which the subject is fully presented. I unite in his

recommendation that the Congress enact such special legislation as may be

necessary to enable the Department to make contracts early in the coming

year for armor of the best quality that can be obtained in this country for

the Maine, Ohio, and Missouri, and that the provision of the act of March

3, 1899, limiting the price of armor to $300 per ton be removed.

In the matter of naval construction Italy and Japan, of the great powers,

laid down less tonnage in the year 1899 than this country, and Italy alone

has less tonnage under construction. I heartily concur in the

recommendations for the increase of the Navy, as suggested by the

Secretary.

Our future progress and prosperity depend upon our ability to equal, if not

surpass, other nations in the enlargement and advance of science, industry,

and commerce. To invention we must turn as one of the most powerful aids to

the accomplishment of such a result. The attention of the Congress is

directed to the report of the Commissioner of Patents, in which will be

found valuable suggestions and recommendations.

On the 30th of June, 1899, the pension roll of the United States numbered

991,519. These include the pensioners of the Army and Navy in all our wars.

The number added to the rolls during the year was 40,991. The number

dropped by reason of death, remarriage, minors by legal limitation, failure

to claim within three years, and other causes, was 43, 186, and the number

of claims disallowed was 107,919. During the year 89,054 pension

certificates were issued, of which 37,077 were for new or original

pensions. The amount disbursed for army and navy pensions during the year

was $138,355,052.95, which was $1,651,461.61 less than the sum of the

appropriations.

The Grand Army of the Republic at its recent national encampment held in

Philadelphia has brought to my attention and to that of the Congress the

wisdom and justice of a modification of the third section of the act of

June 27, 1890, which provides pensions for the widows of officers and

enlisted men who served ninety days or more during the War of the Rebellion

and were honorably discharged, provided that such widows are without other

means of sup, port than their daily labor and were married to the soldier,

sailor, or marine on account of whose service they claim pension prior to

the date of the act.

The present holding of the Department is that if the widow's income aside

from her daily labor does not exceed in amount what her pension would be,

to wit, $96 per annum, she would be deemed to be without other means of

support than her daily labor, and would be entitled to a pension under this

act; while if the widow's income independent of the amount received by her

as the result of her daily labor exceeds $96, she would not be pensionable

under the act. I am advised by the Commissioner of Pensions that the amount

of the income allowed before title to pension would be barred has varied

widely under different administrations of the Pension Office, as well as

during different periods of the same administration, and has been the cause

of just complaint and criticism.

With the approval of the Secretary of the Interior the Commissioner of

Pensions recommends that, in order to make the practice at all times

uniform and to do justice to the dependent widow, the amount of income

allowed independent of the proceeds of her daily labor should be not less

than $250 per annum, and he urges that the Congress shall so amend the act

as to permit the Pension Office to grant pensionable status to widows under

the terms of the third section of the act of June 27, 1890, whose income

aside from the proceeds of daily labor is not in excess of $250 per annum.

I believe this to be a simple act of justice and heartily recommend it.

The Dawes Commission reports that gratifying progress has been made in its

work during the preceding year. The field-work of enrollment of four of the

nations has been completed. I recommend that Congress at an early day make

liberal appropriation for educational purposes in the Indian Territory.

In accordance with the act of Congress approved March 3, 1899. the

preliminary work in connection with the Twelfth Census is now fully under

way. The officers required for the proper administration of the duties

imposed have been selected. The provision for securing a proper enumeration

of the population, as well as to secure evidence of the industrial growth

of the Nation, is broader and more comprehensive than any similar

legislation in the past. The Director advises that every needful effort is

being made to push this great work to completion in the time limited by the

statute. It is believed that the Twelfth Census will emphasize our

remarkable advance in all that pertains to national progress.

Under the authority of the act of Congress approved July 7, 1898, the

commission consisting of the Secretary of the Treasury, the

Attorney-General, and the Secretary of the Interior has made an agreement

of settlement, which has had my approval, of the indebtedness to the

Government growing out of the issue of bonds to aid in the construction of

the Central Pacific and Western Pacific railroads. The agreement secures

to the Government the principal and interest of said bonds, amounting to

$58,812,715.48. There has been paid thereon $11,762,543.12, which has been

covered into the Treasury, and the remainder, payable within ten years,

with interest at the rate Of 3 per cent per annum, payable semiannually, is

secured by the deposit of an equal amount of first-mortgage bonds of the

Pacific Railway companies. The amounts paid and secured to be paid to the

Government on account of the Pacific Railroad subsidy claims are: Union

Pacific, cash - $58,448,223.75

Kansas Pacific, cash - 6,303,000.00

Central and Western Pacific, cash - 11,798,314.14

Notes, secured - 47,050,172.36

Kansas Pacific--dividends for deficiency due United States, cash -

821,897.70 -

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