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President[ William McKinley

         Date[ December 3, 1900

To the Senate and House of Representatives:

At the outgoing of the old and the incoming of the new century you begin

the last session of the Fifty-sixth Congress with evidences on every hand

of individual and national prosperity and with proof of the growing

strength and increasing power for good of Republican institutions. Your

countrymen will join with you in felicitation that American liberty is more

firmly established than ever before, and that love for it and the

determination to preserve it are more universal than at any former period

of our history.

The Republic was never so strong, because never so strongly entrenched in

the hearts of the people as now. The Constitution, with few amendments,

exists as it left the hands of its authors. The additions which have been

made to it proclaim larger freedom and more extended citizenship. Popular

government has demonstrated in its one hundred and twenty-four years of

trial here its stability and security, and its efficiency as the best

instrument of national development and the best safeguard to human rights.

When the Sixth Congress assembled in November, 1800, the population of the

United States was 5,308,483. It is now 76,304,799. Then we had sixteen

States. Now we have forty-five. Then our territory consisted Of 909,050

square miles. It is now 3,846,595 square miles. Education, religion, and

morality have kept pace with our advancement in other directions, and while

extending its power the Government has adhered to its foundation principles

and abated none of them in dealing with our new peoples and possessions. A

nation so preserved and blessed gives reverent thanks to God and invokes

His guidance and the continuance of His care and favor.

In our foreign intercourse the dominant question has been the treatment of

the Chinese problem. Apart from this our relations with the powers have

been happy.

The recent troubles in China spring from the antiforeign agitation which

for the past three years has gained strength in the northern provinces.

Their origin lies deep in the character of the Chinese races and in the

traditions of their Government. The Taiping rebellion and the opening of

Chinese ports to foreign trade and settlement disturbed alike the

homogeneity and the seclusion of China.

Meanwhile foreign activity made itself felt in all quarters, not alone on

the coast, but along the great river arteries and in the remoter districts,

carrying new ideas and introducing new associations among a primitive

people which had pursued for centuries a national policy of isolation.

The telegraph and the railway spreading over their land, the steamers

plying on their waterways, the merchant and the missionary penetrating year

by year farther to the interior, became to the Chinese mind types of an

alien invasion, changing the course of their national life and fraught with

vague forebodings of disaster to their beliefs and their self-control.

For several years before the present troubles all the resources of foreign

diplomacy, backed by moral demonstrations of the physical force of fleets

and arms, have been needed to secure due respect for the treaty rights of

foreigners and to obtain satisfaction from the responsible authorities for

the sporadic outrages upon the persons and property of unoffending

sojourners, which from time to time occurred at widely separated points in

the northern provinces, as in the case of the outbreaks in Sze-chuen and

Shan-tung.

Posting of antiforeign placards became a daily occurrence, which the

repeated reprobation of the Imperial power failed to check or punish. These

inflammatory appeals to the ignorance and superstition of the masses,

mendacious and absurd in their accusations and deeply hostile in their

spirit, could not but work cumulative harm. They aimed at no particular

class of foreigners; they were impartial in attacking everything foreign.

An outbreak in Shan-tung, in which German missionaries were slain, was the

too natural result of these malevolent teachings.

The posting of seditious placards, exhorting to the utter destruction of

foreigners and of every foreign thing, continued unrebuked. Hostile

demonstrations toward the stranger gained strength by organization.

The sect, commonly styled the Boxers, developed greatly in the provinces

north of the Yang-Tse, and with the collusion of many notable officials,

including some in the immediate councils of the Throne itself, became

alarmingly aggressive. No foreigner's life, outside of the protected treaty

ports, was safe. No foreign interest was secure from spoliation.

The diplomatic representatives of the powers in Peking strove in vain to

check this movement. Protest was followed by demand and demand by renewed

protest, to be met with perfunctory edicts from the Palace and evasive and

futile assurances from the Tsung-li Yamen. The circle of the Boxer

influence narrowed about Peking, and while nominally stigmatized as

seditious, it was felt that its spirit pervaded the capital itself, that

the Imperial forces were imbued with its doctrines, and that the immediate

counselors of the Empress Dowager were in full sympathy with the

antiforeign movement.

The increasing gravity of the conditions in China and the imminence of

peril to our own diversified interests in the Empire, as well as to those

of all the other treaty governments, were soon appreciated by this

Government, causing it profound solicitude. The United States from the

earliest days of foreign intercourse with China had followed a policy of

peace, omitting no occasions to testify good will, to further the extension

of lawful trade, to respect the sovereignty of its Government, and to

insure by all legitimate and kindly but earnest means the fullest measure

of protection for the lives and property of our law-abiding citizens and

for the exercise of their beneficent callings among the Chinese people.

Mindful of this, it was felt to be appropriate that our purposes should be

pronounced in favor of such course as would hasten united action of the

powers at Peking to promote the administrative reforms so greatly needed

for strengthening the Imperial Government and maintaining the integrity of

China, in which we believed the whole western world to be alike concerned.

To these ends I caused to be addressed to the several powers occupying

territory and maintaining spheres of influence in China the circular

proposals of 1899, inviting from them declarations of their intentions and

views as to the desirability of the adoption of measures insuring the

benefits of equality of treatment of all foreign trade throughout China.

With gratifying unanimity the responses coincided in this common policy,

enabling me to see in the successful termination of these negotiations

proof of the friendly spirit which animates the various powers interested

in the untrammeled development of commerce and industry in the Chinese

Empire as a source of vast benefit to the whole commercial world.

In this conclusion, which I had the gratification to announce as a

completed engagement to the interested powers on March 20, 1900, I

hopefully discerned a potential factor for the abatement of the distrust of

foreign purposes which for a year past had appeared to inspire the policy

of the Imperial Government, and for the effective exertion by it of power

and authority to quell the critical antiforeign movement in the northern

provinces most immediately influenced by the Manchu sentiment.

Seeking to testify confidence in the willingness and ability of the

Imperial administration to redress the wrongs and prevent the evils we

suffered and feared, the marine guard, which had been sent to Peking in the

autumn of 1899 for the protection of the legation, was withdrawn at the

earliest practicable moment, and all pending questions were remitted, as

far as we were concerned, to the ordinary resorts of diplomatic

intercourse.

The Chinese Government proved, however, unable to check the rising strength

of the Boxers and appeared to be a prey to internal dissensions. In the

unequal contest the antiforeign influences soon gained the ascendancy under

the leadership of Prince Tuan. Organized armies of Boxers, with which the

Imperial forces affiliated, held the country between Peking and the coast,

penetrated into Manchuria up to the Russian borders, and through their

emissaries threatened a like rising throughout northern China.

Attacks upon foreigners, destruction of their property, and slaughter of

native converts were reported from all sides. The Tsung-li Yamen, already

permeated with hostile sympathies, could make no effective response to the

appeals of the legations. At this critical juncture, in the early spring of

this year, a proposal was made by the other powers that a combined fleet

should be assembled in Chinese waters as a moral demonstration, under cover

of which to exact of the Chinese Government respect for foreign treaty

rights and the suppression of the Boxers.

The United States, while not participating in the joint demonstration,

promptly sent from the Philippines all ships that could be spared for

service on the Chinese coast. A small force of marines was landed at Taku

and sent to Peking for the protection of the American legation. Other

powers took similar action, until some four hundred men were assembled in

the capital as legation guards.

Still the peril increased. The legations reported the development of the

seditious movement in Peking and the need of increased provision for

defense against it. While preparations were in progress for a larger

expedition, to strengthen the legation guards and keep the railway open, an

attempt of the foreign ships to make a landing at Taku was met by a fire

from the Chinese forts. The forts were thereupon shelled by the foreign

vessels, the American admiral taking no part in the attack, on the ground

that we were not at war with China and that a hostile demonstration might

consolidate the antiforeign elements and strengthen the Boxers to oppose

the relieving column.

Two days later the Taku forts were captured after a sanguinary conflict.

Severance of communication with Peking followed, and a combined force of

additional guards, which was advancing to Peking by the Pei-Ho, was checked

at Langfang. The isolation of the legations was complete.

The siege and the relief of the legations has passed into undying history.

In all the stirring chapter which records the heroism of the devoted band,

clinging to hope in the face of despair, and the undaunted spirit that led

their relievers through battle and suffering to the goal, it is a memory of

which my countrymen may be justly proud that the honor of our flag was

maintained alike in the siege and the rescue, and that stout American

hearts have again set high, in fervent emulation with true men of other

race and language, the indomitable courage that ever strives for the cause

of right and justice.

By June 19 the legations were cut off. An identical note from the, Yamen

ordered each minister to leave Peking, under a promised escort, within

twenty-four hours. To gain time they replied, asking prolongation of the

time, which was afterwards granted, and requesting an interview with the

Tsung-li Yamen on the following day. No reply being received, on the

morning of the 20th the German minister, Baron von Ketteler, set out for

the Yamen to obtain a response, and oil the way was murdered.

An attempt by the legation guard to recover his body was foiled by the

Chinese. Armed forces turned out against the legations. Their quarters were

surrounded and attacked. The mission compounds were abandoned, their

inmates taking refuge in the British legation, where all the other

legations and guards gathered for more effective defense. Four hundred

persons were crowded in its narrow compass. Two thousand native converts

were assembled in a nearby palace under protection of the foreigners. Lines

of defense were strengthened, trenches dug, barricades raised, and

preparations made to stand a siege, which at once began.

From June 20 until July 17, writes Minister Conger, "there was scarcely

an hour during which there was not firing upon some part of our lines and

into some of the legations, varying from a single shot to a general and

continuous attack along the whole line." Artillery was placed around the

legations and on the over-looking palace walls, and thousands Of 3-inch

shot and shell were fired, destroying some buildings and damaging all. So

thickly did the balls rain, that, when the ammunition of the besieged ran

low, five quarts of Chinese bullets were gathered in an hour in one

compound and recast.

Attempts were made to burn the legations by setting neighboring houses on

fire, but the flames were successfully fought off, although the Austrian,

Belgian, Italian. and Dutch legations were then and subsequently burned.

With the aid of the native converts, directed by the missionaries, to whose

helpful co-operation Mr. Conger awards unstinted praise, the British

legation was made a veritable fortress. The British minister, Sir Claude

MacDonald, was chosen general commander of the defense, with the secretary

of the American legation, Mr. E. G. Squiers, as chief of staff.

To save life and ammunition the besieged sparingly returned the incessant

fire of the Chinese soldiery, fighting only to repel attack or make an

occasional successful sortie for strategic advantage, such as that of

fifty-five American, British, and Russian marines led by Captain Myers, of

the United States Marine Corps, which resulted in the capture of a

formidable barricade on the wall that gravely menaced the American

position. It was held to the last, and proved an invaluable acquisition,

because commanding the water gate through which the relief column entered.

During the siege the defenders lost 65 killed, 135 wounded, and 7 by

disease, the last all children.

On July 14 the besieged had their first communication with the Tsung-li

Yamen, from whom a message came inviting to a conference, which was

declined. Correspondence, however, ensued and a sort of armistice was

agreed upon, which stopped the bombardment and lessened the rifle fire for

a time. Even then no protection whatever was afforded, nor any aid given,

save to send to the legations a small supply of fruit and three sacks of

flour.

Indeed, the only communication had with the Chinese Government related to

the occasional delivery or dispatch of a telegram or to the demands of the

Tsung-li Yamen for the withdrawal of the legations to the coast under

escort. Not only are the protestations of the Chinese Government that it

protected and succored the legations positively contradicted, but

irresistible proof accumulates that the attacks upon them were made by

Imperial troops, regularly uniformed, armed, and officered, belonging to

the command of Jung Lu, the Imperial commander in chief. Decrees

encouraging the Boxers, organizing them tinder prominent Imperial officers,

provisioning them, and even granting them large sums in the name of the

Empress Dowager, are known to exist. Members of the Tsung-li Yamen who

counseled protection of the foreigners were beheaded. Even in the distant

provinces men suspected of foreign sympathy were put to death, prominent

among these being Chang Yen-hoon, formerly Chinese minister in Washington.

With the negotiation of the partial armistice of July 14, a proceeding

which was doubtless promoted by the representations of the Chinese envoy in

Washington, the way was opened for the conveyance to Mr. Conger of a test

message sent by the Secretary of State through the kind offices of Minister

Wu Ting-fang. Mr. Conger's reply, dispatched from Peking on July 18 through

the same channel, afforded to the outside world the first tidings that the

inmates of the legations were still alive and hoping for succor.

This news stimulated the preparations for a joint relief expedition in

numbers sufficient to overcome the resistance which for a month had been

organizing between Taku and the capital. Reinforcements sent by all the

co-operating Governments were constantly arriving. The United States

contingent, hastily assembled from the Philippines or dispatched from this

country, amounted to some 5,000 men, under the able command first of the

lamented Colonel Liscurn and afterwards of General Chaffee.

Toward the end of July the movement began. A severe conflict followed at

Tientsin, in which Colonel Liscurn was killed. The city was stormed and

partly destroyed. Its capture afforded the base of operations from which to

make the final advance, which began in the first days of August, the

expedition being made up of Japanese, Russian, British, and American troops

at the outset.

Another battle was fought and won at Yangtsun. Thereafter the disheartened

Chinese troops offered little show of resistance. A few days later the

important position of Ho-si-woo was taken. A rapid march brought the united

forces to the populous city of Tung Chow, which capitulated without a

contest.

On August 14 the capital was reached. After a brief conflict beneath the

walls the relief column entered and the legations were saved. The United

States soldiers, sailors, and marines, officers and men alike, in those

distant climes and unusual surroundings, showed the same valor, discipline,

and good conduct and gave proof of the same high degree of intelligence and

efficiency which have distinguished them in every emergency.

The Imperial family and the Government had fled a few days before. The city

was without visible control. The remaining Imperial soldiery had made on

the night of the 13th a last attempt to exterminate the besieged, which was

gallantly repelled. It fell to the occupying forces to restore order and

organize a provisional administration.

Happily the acute disturbances were confined to the northern provinces. It

is a relief to recall and a pleasure to record the loyal conduct of the

viceroys and local authorities of the southern and eastern provinces. Their

efforts were continuously directed to the pacific control of the vast

populations under their rule and to the scrupulous observance of foreign

treaty rights. At critical moments they did not hesitate to memorialize the

Throne, urging the protection of the legations, the restoration of

communication, and the assertion of the Imperial authority against the

subversive elements. They maintained excellent relations with the official

representatives of foreign powers. To their kindly disposition is largely

due the success of the consuls in removing many of the missionaries from

the interior to places of safety. In this relation the action of the

consuls should be highly commended. In Shan-tung and eastern Chi-li the

task was difficult, but, thanks to their energy and the cooperation of

American and foreign naval commanders, hundreds of foreigners, including

those of other nationalities than ours, were rescued from imminent peril.

The policy of the United States through all this trying period was clearly

announced and scrupulously carried out. A circular note to the powers dated

July 3 proclaimed our attitude. Treating the condition in the north as one

of virtual anarchy, in which the great provinces of the south and southeast

had no share, we regarded the local authorities in the latter quarters as

representing the Chinese people with whom we sought to remain in peace and

friendship. Our declared aims involved no war against the Chinese nation.

We adhered to the legitimate office of rescuing the imperiled legation,

obtaining redress for wrongs already suffered, securing wherever possible

the safety of American life and property in China, and preventing a spread

of the disorders or their recurrence.

As was then said, "The policy of the Government of the United States is to

seek a solution which may bring about permanent safety and peace to China,

preserve Chinese territorial and administrative entity, protect all rights

guaranteed to friendly powers by treaty and international law, and

safeguard for the world the principle of equal and impartial trade with all

parts of the Chinese Empire."

Faithful to those professions which, as it proved, reflected the views and

purposes of the other co-operating Governments, all our efforts have been

directed toward ending the anomalous situation in China by negotiations for

a settlement at the earliest possible moment. As soon as the sacred duty of

relieving our legation and its dependents was accomplished we withdrew from

active hostilities, leaving our legation under an adequate guard in Peking

as a channel of negotiation and settlement--a course adopted by others of

the interested powers. Overtures of the empowered representatives of the

Chinese Emperor have been considerately entertained.

The Russian proposition looking to the restoration of the Imperial power in

Peking has been accepted as in full consonance with our own desires, for we

have held and hold that effective reparation for wrongs suffered and an

enduring settlement that will make their recurrence impossible can best be

brought about under an authority which the Chinese nation reverences and

obeys. While so doing we forego no jot of our undoubted right to exact

exemplary and deterrent punishment of the responsible authors and abettors

of the criminal acts whereby we and other nations have suffered grievous

injury.

For the real culprits, the evil counselors who have misled the Imperial

judgment and diverted the sovereign authority to their own guilty ends,

full expiation becomes imperative within the rational limits of retributive

Justice. Regarding this as the initial condition of an acceptable

settlement between China and the powers, I said in my message of October 18

to the Chinese Emperor: I trust that negotiations may begin so soon as we

and the other offended Governments shall be effectively satisfied of Your

Majesty's ability and power to treat with just sternness the principal

offenders, who are doubly culpable, not alone toward the foreigners, but

toward Your Majesty, under whose rule the purpose of China to dwell in

concord with the world had hitherto found expression in the welcome and

protection assured to strangers. Taking, as a point of departure, the

Imperial edict appointing Earl Li Hung Chang and Prince Ching

plenipotentiaries to arrange a settlement, and the edict of September 25,

whereby certain high officials were designated for punishment, this

Government has moved, in concert with the other powers, toward the opening

of negotiations, which Mr. Conger, assisted by Mr. Rockhill, has been

authorized to conduct on behalf of the United States.

General bases of negotiation formulated by the Government of the French

Republic have been accepted with certain reservations as to details, made

necessary by our own circumstances, but, like similar reservations by other

powers, open to discussion in the progress of the negotiations. The

disposition of the Emperor's Government to admit liability for wrongs done

to foreign Governments and their nationals, and to act upon such additional

designation of the guilty persons as the foreign ministers at Peking may be

in a position to make, gives hope of a complete settlement of all questions

involved, assuring foreign rights of residence and intercourse on terms of

equality for all the world.

I regard as one of the essential factors of a durable adjustment the

securement of adequate guarantees for liberty of faith, since insecurity of

those natives who may embrace alien creeds is a scarcely less effectual

assault upon the rights of foreign worship and teaching than would be the

direct invasion thereof.

The matter of indemnity for our wronged citizens is a question of grave

concern. Measured in money alone, a sufficient reparation may prove to be

beyond the ability of China to meet. All the powers concur in emphatic

disclaimers of any purpose of aggrandizement through the dismemberment of

the Empire. I am disposed to think that due compensation may be made in

part by increased guarantees of security for foreign rights and immunities,

and, most important of all, by the opening of China to the equal commerce

of all the world. These views have been and will be earnestly advocated by

our representatives.

The Government of Russia has put forward a suggestion, that in the event of

protracted divergence of views in regard to indemnities the matter may be

relegated to the Court of Arbitration at The Hague. I favorably incline to

this, believing that high tribunal could not fail to reach a solution no

less conducive to the stability and enlarged prosperity of China itself

than immediately beneficial to the powers.

Ratifications of a treaty of extradition with the Argentine Republic were

exchanged on June 2 last.

While the Austro-Hungarian Government has in the many cases that have been

reported of the arrest of our naturalized citizens for alleged evasion of

military service faithfully observed the provisions of the treaty and

released such persons from military obligations, it has in some instances

expelled those whose presence in the community of their origin was asserted

to have a pernicious influence. Representations have been made against this

course whenever its adoption has appeared unduly onerous.

We have been urgently solicited by Belgium to ratify the International

Convention of June, 1899, amendatory of the previous Convention of 1890 in

respect to the regulation of the liquor trade in Africa. Compliance was

necessarily withheld, in the absence of the advice and consent of the

Senate thereto. The principle involved has the cordial sympathy of this

Government, which in the reversionary negotiations advocated more drastic

measures, and I would gladly see its extension, by international agreement,

to the restriction of the liquor traffic with all uncivilized peoples,

especially in the Western Pacific.

A conference will be held at Brussels December 11, 1900, under the

Convention for the protection of industrial property, concluded at Paris

March 20, 1883, to which delegates from this country have been appointed.

Any lessening of the difficulties that our inventors encounter in obtaining

patents abroad for their inventions and that our farmers, manufacturers,

and merchants may have in the protection of their trade-marks is worthy of

careful consideration, and your attention will be called to the results of

the conference at the proper time.

In the interest of expanding trade between this country and South America,

efforts have been made during the past year to conclude conventions with

the southern republics for the enlargement of postal facilities. Two such

agreements, signed with Bolivia on April 24, of which that establishing the

money-order system is undergoing certain changes suggested by the

Post-Office Department, have not yet been ratified by this Government. A

treaty of extradition with that country, signed on the same day, is before

the Senate.

A boundary dispute between Brazil and Bolivia over the territory of Acre is

in a fair way of friendly adjustment, a protocol signed in December, 1899,

having agreed on a definite frontier and provided for its demarcation by a

joint commission.

Conditions in Brazil have weighed heavily on our export trade to that

country in marked contrast to the favorable conditions upon which Brazilian

products are admitted into our markets. Urgent representations have been

made to that Government on the subject and some amelioration has been

effected. We rely upon the reciprocal justice and good will of that

Government to assure to us a further improvement in our commercial

relations.

The Convention signed May 24, 1897, for the final settlement of claims left

in abeyance upon the dissolution of the Commission of 1893, was at length

ratified by the Chilean Congress and the supplemental Commission has been

organized.

It remains for the Congress to appropriate for the necessary expenses of

the Commission.

The insurrectionary movement which disturbed Colombia in the latter part of

1899 has been practically suppressed, although guerrillas still operate in

some departments. The executive power of that Republic changed hands in

August last by the act of Vice-President Marroquin in assuming the reins of

government during the absence of President San Clemente from the capital.

The change met with no serious opposition, and, following the precedents in

such cases, the United States minister entered into relations with the new

defacto Government on September 17.

It is gratifying to announce that the residual questions between Costa Rica

and Nicaragua growing out of the Award of President Cleveland in 1888 have

been adjusted through the choice of an American engineer, General E. P.

Alexander, as umpire to run the disputed line. His task has been

accomplished to the satisfaction of both contestants.

A revolution in the Dominican Republic toward the close of last year

resulted in the installation of President Jimenez, whose Government was

formally recognized in January. Since then final payment has been made of

the American claim in regard to the Ozama bridge.

The year of the exposition has been fruitful in occasions for displaying

the good will that exists between this country and France. This great

competition brought together from every nation the best in natural

productions, industry, science, and the arts, submitted in generous rivalry

to a judgment made all the more searching because of that rivalry. The

extraordinary increase of exportations from this country during the past

three years and the activity with which our inventions and wares had

invaded new markets caused much interest to center upon the American

exhibit, and every encouragement was offered in the way of space and

facilities to permit of its being comprehensive as a whole and complete in

every part.

It was, however, not an easy task to assemble exhibits that could fitly

illustrate our diversified resources and manufactures. Singularly enough,

our national prosperity lessened the incentive to exhibit. The dealer in

raw materials knew that the user must come to him; the great factories were

contented with the phenomenal demand for their output, not alone at home,

but also abroad, where merit had already won a profitable trade.

Appeals had to be made to the patriotism of exhibitors to induce them to

incur outlays promising no immediate return. This was especially the case

where it became needful to complete an industrial sequence or illustrate a

class of processes. One manufacturer after another had to be visited and

importuned, and at times, after a promise to exhibit in a particular

section had been obtained, it would be withdrawn, owing to pressure of

trade orders, and a new quest would have to be made.

The installation of exhibits, too, encountered many obstacles and involved

unexpected cost. The exposition was far from ready at the date fixed for

its opening. The French transportation lines were congested with offered

freight. Belated goods had to be hastily installed in unfinished quarters

with whatever labor could be obtained in the prevailing confusion. Nor was

the task of the Commission lightened by the fact that, owing to the scheme

of classification adopted, it was impossible to have the entire exhibit of

any one country in the same building or more than one group of exhibits in

the same part of any building. Our installations were scattered on both

sides of the Seine and in widely remote suburbs of Paris, so that

additional assistants were needed for the work of supervision and

arrangement.

Despite all these drawbacks the contribution of the United States was not

only the largest foreign display, but was among the earliest in place and

the most orderly in arrangement. Our exhibits were shown in one hundred and

one out of one hundred and twenty-one classes, and more completely covered

the entire classification than those of any other nation. In total number

they ranked next after those of France, and the attractive form in which

they were presented secured general attention.

A criterion of the extent and success of our participation and of the

thoroughness with which our exhibits were organized is seen in the awards

granted to American exhibitors by the international jury, namely, grand

prizes, 240; gold medals, 597; silver medals, 776; bronze medals, 541, and

honorable mentions, 322--2,476 in all, being the greatest total number

given to the exhibit of any exhibiting nation, as well as the largest

number in each grade. This significant recognition of merit in competition

with the chosen exhibits of all other nations and at the hands of juries

almost wholly made up of representatives of France and other competing

countries is not only most gratifying, but is especially valuable, since it

sets us to the front in international questions of supply and demand, while

the large proportion of awards in the classes of art and artistic

manufactures afforded unexpected proof of the stimulation of national

culture by the prosperity that flows from natural productiveness joined to

industrial excellence.

Apart from the exposition several occasions for showing international good

will occurred. The inauguration in Paris of the Lafayette Monument,

presented by the school children of the United States, and the designing of

a commemorative coin by our Mint and the presentation of the first piece

struck to the President of the Republic, were marked by appropriate

ceremonies, and the Fourth of July was especially observed in the French

capital.

Good will prevails in our relations with the German Empire. An amicable

adjustment of the long-pending question of the admission of our

life-insurance companies to do business in Prussia has been reached. One of

the principal companies has already been readmitted and the way is opened

for the others to share the privilege.

The settlement of the Samoan problem, to which I adverted in my last

message, has accomplished good results. Peace and contentment prevail in

the islands, especially in Tutuila, where a convenient administration that

has won the confidence and esteem of the kindly disposed natives has been

organized under the direction of the commander of the United States naval

station at Pago-Pago.

An Imperial meat inspection law has been enacted for Germany. While it may

simplify the inspections, it prohibits certain products heretofore

admitted. There is still great uncertainty as to whether our well-nigh

extinguished German trade in meat products can revive tinder its new

burdens. Much will depend upon regulations not yet promulgated, which we

confidently hope will be free from the discriminations which attended the

enforcement of the old statutes.

The remaining link in the new lines of direct telegraphic communication

between the United States and the German Empire has recently been

completed, affording a gratifying occasion for exchange of friendly

congratulations with the German Emperor.

Our friendly relations with Great Britain continue. The war in Southern

Africa introduced important questions. A condition unusual in international

wars was presented in that while one belligerent had control of the seas,

the other had no ports, shipping, or direct trade, but was only accessible

through the territory of a neutral. Vexatious questions arose through Great

Britain's action in respect to neutral cargoes, not contraband in their own

nature, shipped to Portuguese South Africa, on the score of probable or

suspected ultimate destination to the Boer States.

Such consignments in British ships, by which alone direct trade is kept up

between our ports and Southern Africa, were seized in application of a

municipal law prohibiting British vessels from trading with the enemy

without regard to any contraband character of the goods, while cargoes

shipped to Delagoa Bay in neutral bottoms were arrested on the ground of

alleged destination to enemy's country. Appropriate representations on our

part resulted in the British Government agreeing to purchase outright all

such goods shown to be the actual property of American citizens, thus

closing the incident to the satisfaction of the immediately interested

parties, although, unfortunately, without a broad settlement of the

question of a neutral's right to send goods not contraband per se to a

neutral port adjacent to a belligerent area.

The work of marking certain provisional boundary points, for convenience of

administration, around the head of Lynn Canal, in accordance with the

temporary arrangement of October, 1899, Was completed by a joint survey in

July last. The modus vivendi has so far worked without friction, and the

Dominion Government has provided rules and regulations for securing to our

citizens the benefit of the reciprocal stipulation that the citizens or

subjects of either power found by that arrangement within the temporary

jurisdiction of the other shall suffer no diminution of the rights and

privileges they have hitherto enjoyed. But however necessary such an

expedient may have been to tide over the grave emergencies of the

situation, it is at best but an unsatisfactory makeshift, which should not

be suffered to delay the speedy and complete establishment of the frontier

line to which we are entitled under the Russo-American treaty for the

cession of Alaska.

In this relation I may refer again to the need of definitely marking the

Alaskan boundary where it follows the one hundred and forty-first meridian.

A convention to that end has been before the Senate for some two years, but

as no action has been taken I contemplate negotiating a new convention for

a joint determination of the meridian by telegraphic observations. These,

it is believed, will give more accurate and unquestionable results than the

sidereal methods heretofore independently followed, which, as is known,

proved discrepant at several points on the line, although not varying at

any place more than 700 feet.

The pending claim of R. H. May against the Guatemalan Government has been

settled by arbitration, Mr. George F. B. Jenner, British minister at

Guatemala, who was chosen as sole arbitrator, having awarded $143,750.73 in

gold to the claimant.

Various American claims against Haiti have been or are being advanced to

the resort of arbitration.

As the result of negotiations with the Government of Honduras in regard to

the indemnity demanded for the murder of Frank H. Pears in Honduras, that

Government has paid $10,000 in settlement of the claim of the heirs.

The assassination of King Humbert called forth sincere expressions of

sorrow from this Government and people, and occasion was fitly taken to

testify to the Italian nation the high regard here felt for the memory of

the lamented ruler.

In my last message I referred at considerable length to the lynching of

five Italians at Tallulah. Notwithstanding the efforts of the Federal

Government, the production of evidence tending to inculpate the authors of

this grievous offense against our civilization, and the repeated inquests

set on foot by the authorities of the State of Louisiana, no punishments

have followed. Successive grand juries have failed to indict. The

representations of the Italian Government in the face of this miscarriage

have been most temperate and just.

Setting the principle at issue high above all consideration of merely

pecuniary indemnification, such as this Government made in the three

previous cases, Italy has solemnly invoked the pledges of existing treaty

and asked that the justice to which she is entitled shall be meted in

regard to her unfortunate countrymen in our territory with the same full

measure she herself would give to any American were his reciprocal treaty

rights contemned.

I renew the urgent recommendations I made last year that the Congress

appropriately confer upon the Federal courts jurisdiction in this class of

international cases where the ultimate responsibility of the Federal

Government may be involved, and I invite action upon the bills to

accomplish this which were introduced in the Sen. ate and House. It is

incumbent upon us to remedy the statutory omission which has led, and may

again lead, to such untoward results. I have pointed out the necessity and

the precedent for legislation of this character. Its enactment is a simple

measure of previsory justice toward the nations with which we as a

sovereign equal make treaties requiring reciprocal observance.

While the Italian Government naturally regards such action as the primary

and, indeed, the most essential element in the disposal of the Tallulah

incident, I advise that, in accordance with precedent, and in view of the

improbability of that particular case being reached by the bill now

pending, Congress make gracious provision for indemnity to the Italian

sufferers in the same form and proportion as heretofore.

In my inaugural address I referred to the general subject of lynching in

these words: Lynching must not be tolerated in a great and civilized

country like the United States; courts, not mobs, must execute the

penalties of the law. The preservation of public order, the right of

discussion, the integrity of courts, and the orderly administration of

justice must continue forever the rock of safety upon which our Government

securely rests. This I most urgently reiterate and again invite the

attention of my countrymen to this reproach upon our civilization.

The closing year has witnessed a decided strengthening of Japan's relations

to other states. The development of her independent judicial and

administrative functions under the treaties which took effect July 17,

1899, has proceeded without international friction, showing the competence

of the Japanese to hold a foremost place among modern peoples.

In the treatment of the difficult Chinese problems Japan has acted in

harmonious concert with the other powers, and her generous cooperation

materially aided in the joint relief of the beleaguered legations in Peking

and in bringing about an understanding preliminary to a settlement of the

issues between the powers and China. Japan's declarations in favor of the

integrity of the Chinese Empire and the conservation of open world trade

therewith have been frank and positive. As a factor for promoting the

general interests of peace, order, and fair commerce in the Far East the

influence of Japan can hardly be overestimated.

The valuable aid and kindly courtesies extended by the Japanese Government

and naval officers to the battle ship Oregon are gratefully appreciated.

Complaint was made last summer of the discriminatory enforcement of a

bubonic quarantine against Japanese on the Pacific coast and of

interference with their travel in California and Colorado under the health

laws of those States. The latter restrictions have been adjudged by a

Federal court to be unconstitutional. No recurrence of either cause of

complaint is apprehended.

No noteworthy incident has occurred in our relations with our important

southern neighbor. Commercial intercourse with Mexico continues to thrive,

and the two Governments neglect no opportunity to foster their mutual

interests in all practicable ways.

Pursuant to the declaration of the Supreme Court that the awards of the

late joint Commission in the La Abra and Weil claims were obtained through

fraud, the sum awarded in the first case, $403,030.08, has been returned to

Mexico, and the amount of the Weil award will be returned in like manner.

A Convention indefinitely extending the time for the labors of the United

States and Mexican International (Water) Boundary Commission has been

signed.

It is with satisfaction that I am able to announce the formal notification

at The Hague, on September 4, of the deposit of ratifications of the

Convention for the Pacific Settlement of International Disputes by sixteen

powers, namely, the United States, Austria, Belgium, Denmark, England,

France, Germany, Italy, Persia, Portugal, Roumania, Russia, Siam, Spain,

Sweden and Norway, and the Netherlands. Japan also has since ratified the

Convention.

The Administrative Council of the Permanent Court of Arbitration has been

organized and has adopted rules of order and a constitution for the

International Arbitration Bureau. In accordance with Article XXIII of the

Convention providing for the appointment by each signatory power of persons

of known competency in questions of international law as arbitrators, I

have appointed as members of this Court, Hon. Benjamin Harrison, of

Indiana, ex-President of the United States; Hon. Melville W. Fuller, of

Illinois, Chief justice of the United States; Hon. John W. Griggs, of New

Jersey, Attorney General of the United States; and Hon. George Gray, of

Delaware, a judge of the circuit court of the United States.

As an incident of the brief revolution in the Mosquito district of

Nicaragua early in 1899 the insurgents forcibly collected from American

merchants duties upon imports. On the restoration of order the Nicaraguan

authorities demanded a second payment of such duties on the ground that

they were due to the titular Government and that their diversion had aided

the revolt.

This position was not accepted by us. After prolonged discussion a

compromise was effected under which the amount of the second payments was

deposited with the British consul at San Juan del Norte in trust until the

two Governments should determine whether the first payments had been made

under compulsion to a de facto authority. Agreement as to this was not

reached, and the point was waived by the act of the Nicaraguan Government

in requesting the British consul to return the deposits to the merchants.

Menacing differences between several of the Central American States have

been accommodated, our ministers rendering good offices toward an

understanding.

The all-important matter of an interoceanic canal has assumed a new phase.

Adhering to its refusal to reopen the question of the forfeiture of the

contract of the Maritime Canal Company, which was terminated for alleged

nonexecution in October, 1899, the Government of Nicaragua has since

supplemented that action by declaring the so styled Eyre-Cragin option void

for nonpayment of the stipulated advance. Protests in relation to these

acts have been filed in the State Department and are under consideration.

Deeming itself relieved from existing engagements, the Nicaraguan

Government shows a disposition to deal freely with the canal question

either in the way of negotiations with the United States or by taking

measures to promote the waterway.

Overtures for a convention to effect the building of a canal under the

auspices of the United States are under consideration. In the meantime, the

views of the Congress upon the general subject, in the light of the report

of the Commission appointed to examine the comparative merits of the

various trans-Isthmian ship-canal projects, may be awaited.

I commend to the early attention of the Senate the Convention with Great

Britain to facilitate the construction of such a canal and to remove any

objection which might arise out of the Convention commonly called the

Clayton-Bulwer Treaty.

The long-standing contention with Portugal, growing out of the seizure of

the Delagoa Bay Railway, has been at last determined by a favorable award

of the tribunal of arbitration at Berne, to which it was submitted. The

amount of the award, which was deposited in London awaiting arrangements by

the Governments of the United States and Great Britain for its disposal,

has recently been paid over to the two Governments.

A lately signed Convention of Extradition with Peru as amended by the

Senate has been ratified by the Peruvian Congress.

Another illustration of the policy of this Government to refer

international disputes to impartial arbitration is seen in the agreement

reached with Russia to submit the claims on behalf of American sealing

vessels seized in Bering Sea to determination by Mr. T. M. C. Asser, a

distinguished statesman and jurist of the Netherlands.

Thanks are due to the Imperial Russian Government for the kindly aid

rendered by its authorities in eastern Siberia to American missionaries

fleeing from Manchuria.

Satisfactory progress has been made toward the conclusion of a general

treaty of friendship and intercourse with Spain, in replacement of the old

treaty, which passed into abeyance by reason of the late war. A new

convention of extradition is approaching completion, and I should be much

pleased were a commercial arrangement to follow. I feel that we should not

suffer to pass any opportunity to reaffirm the cordial ties that existed

between us and Spain from the time of our earliest independence, and to

enhance the mutual benefits of that commercial intercourse which is natural

between the two countries.

By the terms of the Treaty of Peace the line bounding the ceded Philippine

group in the southwest failed to include several small islands lying

westward of the Sulus, which have always been recognized as under Spanish

control. The occupation of Sibutd and Cagayan Sulu by our naval forces

elicited a claim on the part of Spain, the essential equity of which could

not be gainsaid. In order to cure the defect of the treaty by removing all

possible ground of future misunderstanding respecting the interpretation of

its third article, I directed the negotiation of a supplementary treaty,

which will be forthwith laid before the Senate, whereby Spain quits all

title and claim of title to the islands named as well as to any and all

islands belonging to the Philippine Archipelago lying outside the lines

described in said third article, and agrees that all such islands shall be

comprehended in the cession of the archipelago as fully as if they had been

expressly included within those lines. In consideration of this cession the

United States is to pay to Spain the sum of $100,000.

A bill is now pending to effect the recommendation made in my last annual

message that appropriate legislation be had to carry into execution Article

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

the payment of certain claims for indemnity of its citizens against Spain.

I ask that action be taken to fulfill this obligation.

The King of Sweden and Norway has accepted the joint invitation of the

United States, Germany, and Great Britain to arbitrate claims growing out

of losses sustained in the Samoan Islands in the course of military

operations made necessary by the disturbances in 1899.

Our claims upon the Government of the Sultan for reparation for injuries

suffered by American citizens in Armenia and elsewhere give promise of

early and satisfactory settlement. His Majesty's good disposition in this

regard has been evinced by the issuance of an irade for rebuilding the

American college at Harpoot.

The failure of action by the Senate at its last session upon the commercial

conventions then submitted for its consideration and approval, although

caused by the great pressure of other legislative business, has caused much

disappointment to the agricultural and industrial interests of the country,

which hoped to profit by their provisions. The conventional periods for

their ratification having expired, it became necessary to sign additional

articles extending the time for that purpose. This was requested on our

part, and the other Governments interested have concurred with the

exception of one convention, in respect to which no formal reply has been

received.

Since my last communication to the Congress on this subject special

commercial agreements under the third section of the tariff act have been

proclaimed with Portugal, with Italy, and with Germany. Commercial

conventions tinder the general limitations of the fourth section of the

same act have been concluded with Nicaragua, with Ecuador, with the

Dominican Republic, with Great Britain on behalf of the island of Trinidad,

and with Denmark on behalf of the island of St. Croix. These will be early

communicated to the Senate. Negotiations with other Governments are in

progress for the improvement and security of our commercial relations.

The policy of reciprocity so manifestly rests upon the principles of

international equity and has been so repeatedly approved by the people of

the United States that there ought to be no hesitation in either branch of

the Congress in giving to it full effect.

This Government desires to preserve the most just and amicable commercial

relations with all foreign countries, unmoved by the industrial rivalries

necessarily developed in the expansion of international trade. It is

believed that the foreign Governments generally entertain the same purpose,

although in some instances there are clamorous demands upon them for

legislation specifically hostile to American interests. Should these

demands prevail I shall communicate with the Congress with the view of

advising such legislation as may be necessary to meet the emergency.

The exposition of the resources and products of the Western Hemisphere to

be held at Buffalo next year promises important results not only for the

United States but for the other participating countries. It is gratifying

that the Latin-American States have evinced the liveliest interest, and the

fact that an International American Congress will be held in the City of

Mexico while the exposition is in progress encourages the hope of a larger

display at Buffalo than might otherwise be practicable. The work of

preparing an exhibit of our national resources is making satisfactory

progress under the direction of different officials of the Federal

Government, and the various States of the Union have shown a disposition

toward the most liberal participation in the enterprise.

The Bureau of the American Republics continues to discharge, with the

happiest results, the important work of promoting cordial relations between

the United States and the Latin-American countries, all of which are now

active members of the International Union. The Bureau has been instrumental

in bringing about the agreement for another International American

Congress, which is to meet in the City of Mexico in October, 1901. The

Bureau's future for another term of ten years is assured by the

international compact, but the congress will doubtless have much to do with

shaping new lines of work and a general policy. Its usefulness to the

interests of Latin-American trade is widely appreciated and shows a

gratifying development.

The practical utility of the consular service in obtaining a wide range of

information as to the industries and commerce of other countries and the

opportunities thereby afforded for introducing the sale of our goods have

kept steadily in advance of the notable expansion of our foreign trade, and

abundant evidence has been furnished, both at home and abroad, of the fact

that the Consular Reports, including many from our diplomatic

representatives, have to a considerable extent pointed out ways and means

of disposing of a great variety of manufactured goods which otherwise might

not have found sale abroad.

Testimony of foreign observers to the commercial efficiency of the consular

corps seems to be conclusive, and our own manufacturers and exporters

highly appreciate the value of the services rendered not only in the

printed reports but also in the individual efforts of consular officers to

promote American trade. An increasing part of the work of the Bureau of

Foreign Commerce, whose primary duty it is to compile and print the

reports, is to answer inquiries from trade organizations, business houses,

etc., as to conditions in various parts of the world, and, notwithstanding

the smallness of the force employed, the work has been so systematized that

responses are made with such promptitude and accuracy as to elicit

flattering encomiums. The experiment of printing the Consular Reports daily

for immediate use by trade bodies, exporters, and the press, which was

begun in January, 1898, continues to give general satisfaction.

It is gratifying to be able to state that the surplus revenues for the

fiscal year ended June 30, 1900, were $79,527,060.18. For the six preceding

years we had only deficits, the aggregate of which from 1894 to 1899,

inclusive, amounted to $283,022,991.14. The receipts for the year from all

sources, exclusive of postal revenues, aggregated $567,240,851.89, and

expenditures for all purposes, except for the administration of the postal

department, aggregated $487,713,791.71. The receipts from customs were

$233,164,871.16, an increase over the preceding year Of $27,036,389.41. The

receipts from internal revenue were $295,327,926.76, an increase Of

$21,890,765.25 over 1899. The receipts from miscellaneous sources were

$38,748,053.97, as against $36,394,976.92 for the previous year.

It is gratifying also to note that during the year a considerable reduction

is shown in the expenditures of the Government. The War Department

expenditures for the fiscal year 1900 were $134,774,767.78, a reduction of

$95,066,486.69 over those of 1899. In the Navy Department the expenditures

were $55,953,077.72 for the year 1900, as against $63,942,104.25 for the

preceding year, a decrease of $7,989,026.53. In the expenditures on account

of Indians there was a decrease in 1900 over 1899 Of $2,630,604.38; and in

the civil and miscellaneous expenses for 1900 there was a reduction Of

$13,418,065.74.

Because of the excess of revenues over expenditures the Secretary of the

Treasury was enabled to apply bonds and other securities to the sinking

fund to the amount Of $56,544,556.06. The details of the sinking fund are

set forth in the report of the Secretary of the Treasury, to which I invite

attention. The Secretary of the Treasury estimates that the receipts for

the current fiscal year will aggregate $580,000,000 and the expenditures

$500,000,000, leaving an excess of revenues over expenditures of

$80,000,000. The present condition of the Treasury is one of undoubted

strength. The available cash balance November 30 was $139,303,794.50. Under

the form of statement prior to the financial law of March 14 last there

would have been included in the statement of available cash gold coin and

bullion held for the redemption of United States notes.

If this form were pursued, the cash balance including the present gold

reserve of $150,000,000, would be $289,303,794.50. Such balance November

30, 1899, was $296,495,301.55. In the general fund, which is wholly

separate from the reserve and trust funds, there was on November 30,

$70,090,073.15 in gold coin and bullion, to which should be added

$22,957,300 in gold certificates subject to issue, against which there is

held in the Division of Redemption gold coin and bullion, making a total

holding of free gold amounting to $93,047,373.15.

It will be the duty as I am sure it will be the disposition of the Congress

to provide whatever further legislation is needed to insure the continued

parity under all conditions between our two forms of metallic money, silver

and gold.

Our surplus revenues have permitted the Secretary of the Treasury since the

close of the fiscal year to call in the funded loan of 1891 continued at 2

per cent, in the sum of $25,364,500. To and including November 30,

$23,458,100 Of these bonds have been paid. This sum, together with the

amount which may accrue from further redemptions under the call, will be

applied to the sinking fund.

The law of March 14, 1900, provided for refunding into 2 per cent

thirty-year bonds, payable, principal and interest, in gold coin of the

present standard value, that portion of the public debt represented by the

3 per cent bonds of 1908, the 4 percents Of 1907, and the 5 percents of

1904, Of which there was outstanding at the date of said law $839,149,930,

The holders of the old bonds presented them for exchange between March 14

and November 30 to the amount of $364,943,750. The net saving to the

Government on these transactions aggregates $9,106,166.

Another effect of the operation, as stated by the Secretary, is to reduce

the charge upon the Treasury for the payment of interest from the dates of

refunding to February 1, 1904, by the sum of more than seven million

dollars annually. From February 1, 1904, to July 1, 11907, the annual

interest charge will be reduced by the sum of more than five millions, and

for the thirteen months ending August 1, 1908, by about one million. The

full details of the refunding are given in the annual report of the

Secretary of the Treasury.

The beneficial effect of the financial act of 1900, so far as it relates to

a modification of the national banking act, is already apparent. The

provision for the incorporation of national banks with a capital of not

less than $25,000 in places not exceeding three thousand inhabitants has

resulted in the extension of banking facilities to many small communities

hitherto unable to provide themselves with banking institutions under the

national system. There were organized from the enactment of the law up to

and including November 30, 369 national banks, of which 266 were with

capital less than $50,000, and 103 with capital of $50,000 or more.

It is worthy of mention that the greater number of banks being organized

under the new law are in sections where the need of banking facilities has

been most pronounced. Iowa stands first, with 30 banks of the smaller

class, while Texas, Oklahoma, Indian Territory, and the middle and western

sections of the country have also availed themselves largely of the

privileges under the new law.

A large increase in national bank-note circulation has resulted from the

provision of the act which permits national banks to issue circulating

notes to the par value of the United States bonds deposited as security

instead of only go per cent thereof, as heretofore. The increase in

circulating notes from March 14 to November 30 is $77,889,570.

The party in power is committed to such legislation as will better make the

currency responsive to the varying needs of business at all seasons and in

all sections.

Our foreign trade shows a remarkable record of commercial and industrial

progress. The total of imports and exports for the first time in the

history of the country exceeded two billions of dollars. The exports are

greater than they have ever been before, the total for the fiscal year 1900

being $1,394,483,082, an increase over 1899 of $167,459,780, an increase

over 1898 of $163,000,752, over 1897 Of $343,489,526, and greater than 1896

by $511,876,144.

The growth of manufactures in the United States is evidenced by the fact

that exports of manufactured products largely exceed those of any previous

year, their value for 1900 being $433,851,756, against $339,592,146 in

1899, an increase of 28 per cent.

Agricultural products were also exported during 1900 in greater volume than

in 1899, the total for the year being $835,858,123, against $784,776,142 in

1899.

The imports for the year amounted to $849,941,184, an increase over 1899 of

$152,792,695. This increase is largely in materials for manufacture, and is

in response to the rapid development of manufacturing in the United States.

While there was imported for use in manufactures in 1900 material to the

value of $79,768,972 in excess of 1899, it is reassuring to observe that

there is a tendency toward decrease in the importation of articles

manufactured ready for consumption, which in 1900 formed 15.17 per cent of

the total imports, against 15.54 per cent in 1899 and 21.09 per cent in

1896.

I recommend that the Congress at its present session reduce the

internal-revenue taxes imposed to meet the expenses of the war with Spain.

in the sum of thirty millions of dollars. This reduction should be secured

by the remission of those taxes which experience has shown to be the most

burdensome to the industries of the people.

I specially urge that there be included in whatever reduction is made the

legacy tax on bequests for public uses of a literary, educational, or

charitable character.

American vessels during the past three years have carried about 9 per cent

of our exports and imports. Foreign ships should carry the least, not the

greatest, part of American trade. The remarkable growth of our steel

industries, the progress of shipbuilding for the domestic trade, and our

steadily maintained expenditures for the Navy have created an opportunity

to place the United States in the first rank of commercial maritime powers.

Besides realizing a proper national aspiration this will mean the

establishment and healthy growth along all our coasts of a distinctive

national industry, expanding the field for the profitable employment of

labor and capital. It will increase the transportation facilities and

reduce freight charges on the vast volume of products brought from the

interior to the seaboard for export, and will strengthen an arm of the

national defense upon which the founders of the Government and their

successors have relied. In again urging immediate action by the Congress on

measures to promote American shipping and foreign trade, I direct attention

to the recommendations on the subject in previous messages, and

particularly to the opinion expressed in the message of 1899: 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. The attention of the Congress is invited to the recommendation

of the Secretary of the Treasury in his annual report for legislation in

behalf of the Revenue-Cutter Service, and favorable action is urged.

In my last annual message to the Congress I called attention to the

necessity for early action to remedy such evils as might be found to exist

in connection with combinations of capital organized into trusts, and again

invite attention to my discussion of the subject at that time, which

concluded with these words: 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. Restraint upon such combinations as are injurious, and which are

within Federal jurisdiction, should be promptly applied by the Congress.

In my last annual message I dwelt at some length upon the condition of

affairs in the Philippines. While seeking to impress upon you that the

grave responsibility of the future government of those islands rests with

the Congress of the United States, I abstained from recommending at that

time a specific and final form of government for the territory actually

held by the United States forces and in which as long as insurrection

continues the military arm must necessarily be supreme. I stated my

purpose, until the Congress shall have made the formal expression of its

will, to use the authority vested in me by the Constitution and the

statutes to uphold the sovereignty of the United States in those distant

islands as in all other places where our flag rightfully floats, placing,

to that end, at the disposal of the army and navy all the means which the

liberality of the Congress and the people have provided. No contrary

expression of the will of the Congress having been made, I have steadfastly

pursued the purpose so declared, employing the civil arm as well toward the

accomplishment of pacification and the institution of local governments

within the lines of authority and law.

Progress in the hoped-for direction has been favorable. Our forces have

successfully controlled the greater part of the islands, overcoming the

organized forces of the insurgents and carrying order and administrative

regularity to all quarters. What opposition remains is for the most part

scattered, obeying no concerted plan of strategic action, operating only by

the methods common to the traditions of guerrilla warfare, which, while

ineffective to alter the general control now established, are still

sufficient to beget insecurity among the populations that have felt the

good results of our control and thus delay the conferment upon them of the

fuller measures of local self-government, of education, and of industrial

and agricultural development which we stand ready to give to them.

By the spring of this year the effective opposition of the dissatisfied

Tagals to the authority of the United States was virtually ended, thus

opening the door for the extension of a stable administration over much of

the territory of the Archipelago. Desiring to bring this about, I appointed

in March last a civil Commission composed of the Hon. William H. Taft, of

Ohio; Prof. Dean C. Worcester, of Michigan; the Hon. Luke I. Wright, of

Tennessee; the Hon. Henry C. Ide, of Vermont, and Prof. Bernard Moses, of

California. The aims of their mission and the scope of their authority are

clearly set forth in my instructions of April 7, 1900, addressed to the

Secretary of War to be transmitted to them:

In the message transmitted to the Congress on the 5th of December, 1899, I

said, speaking of the Philippine Islands: "As long as the insurrection

continues the military arm must necessarily be supreme. But there is no

reason why steps should not be taken from time to time to inaugurate

governments essentially popular in their form as fast as territory is held

and controlled by our troops. To this end I am considering the advisability

of the return of the Commission, or such of the members thereof as can be

secured, to aid the existing authorities and facilitate this work

throughout the islands."

To give effect to the intention thus expressed, I have appointed Hon.

William H. Taft, of Ohio; Prof. Dean C. Worcester, of Michigan; Non. Luke

I. Wright, of Tennessee; Hon. Henry C. Ide, of Vermont, and Prof. Bernard

Moses, of California, Commissioners to the Philippine Islands to continue

and perfect the work of organizing and establishing civil government

already commenced by the military authorities, subject in all respects to

any laws which Congress may hereafter enact.

The Commissioners named will meet and act as a board, and the Hon. William

H. Taft t is designated as president of the board. It is probable that the

transfer of authority from military commanders to civil officers will be

gradual and will occupy a considerable period. Its successful

accomplishment and the maintenance of peace and order in the meantime will

require the most perfect co-operation between the civil and military

authorities in the islands, and both should be directed during the

transition period by the same Executive Department. The Commission will

therefore report to the Secretary of War, and all their action will be

subject to your approval and control.

You will instruct the Commission to proceed to the city of Manila, where

they will make their principal office, and to communicate with the Military

Governor of the Philippine Islands, whom you will at the same time direct

to render to them every assistance within his power in the performance of

their duties. Without hampering them by too specific instructions, they

should in general be enjoined, after making themselves familiar with the

conditions and needs of the country, to devote their attention in the first

instance to the establishment of municipal governments, in which the

natives of the islands, both in the cities and in the rural communities,

shall be afforded the opportunity to manage their own local affairs to the

fullest extent of which they are capable and subject to the least degree of

supervision and control which a careful study of their capacities and

observation of the workings of native control show to be consistent with

the maintenance of law, order, and loyalty.

The next subject in order of importance should be the organization of

government in the larger administrative divisions corresponding to

counties, departments, or provinces, in which the common interests of many

or several municipalities falling within the same tribal lines, or the same

natural geographical limits, may best be subserved by a common

administration. Whenever the Commission is of the opinion that the

condition of affairs in the islands is such that the central administration

may safely be transferred from military to civil control they will report

that conclusion to you, with their recommendations as to the form of

central government to be established for the purpose of taking over the

control.

Beginning with the 1st day of September, 1900, the authority to exercise,

subject to my approval, through the Secretary of War, that part of the

power of government in the Philippine Islands which is of a legislative

nature is to be transferred from the Military Governor of the islands to

this Commission, to be thereafter exercised by them in the place and stead

of the Military Governor, under such rules and regulations as you shall

prescribe, until the establishment of the civil central government for the

islands contemplated in the last foregoing paragraph, or until Congress

shall otherwise provide. Exercise of this legislative authority will

include the making of rules and orders, having the effect of law, for the

raising of revenue by taxes, customs duties, and imposts; the appropriation

and expenditure of public funds of the islands; the establishment of an

educational system throughout the islands; the establishment of a system

to secure an efficient civil service; the organization and establishment of

courts; the organization and establishment of municipal and departmental

governments, and all other matters of a civil nature for which the Military

Governor is now competent to provide by rules or orders of a legislative

character.

The Commission will also have power during the same period to appoint to

office such officers under the judicial, educational, and civil-service

systems and in the municipal and departmental governments as shall be

provided for. Until the complete transfer of control the Military Governor

will remain the chief executive head of the government of the islands, and

will exercise the executive authority now possessed by him and not herein

expressly assigned to the Commission, subject, however, to the rules and

orders enacted by the Commission in the exercise of the legislative powers

conferred upon them. In the meantime the municipal and departmental

governments will continue to report to the Military Governor and be subject

to his administrative supervision and control, under your direction, but

that supervision and control will be confined within the narrowest limits

consistent with the requirement that the powers of government in the

municipalities and departments shall be honestly and effectively exercised

and that law and order and individual freedom shall be maintained.

All legislative rules and orders, establishments of government, and

appointments to office by the Commission will take effect immediately, or

at such times as they shall designate, subject to your approval and action

upon the coming in of the Commission's reports, which are to be made from

time to time as their action is taken. Wherever civil governments are

constituted under the direction of the Commission such military posts,

garrisons, and forces will be continued for the suppression of insurrection

and brigandage and the maintenance of law and order as the Military

Commander shall deem requisite, and the military forces shall be at all

times subject, under his orders, to the call of the civil authorities for

the maintenance of law and order and the enforcement of their authority.

In the establishment of municipal governments the Commission will take as

the basis of their work the governments established by the Military

Governor under his order of August 8, 1899. and under the report of the

board constituted by the Military Governor by his order of January 29,

1900, to formulate and report a plan of municipal government, of which His

Honor Cayetano Arellano, President of the Audiencia, was chairman, and they

will give to the conclusions of that board the weight and consideration

which the high character and distinguished abilities of its members

justify.

In the constitution of departmental or provincial governments they will

give especial attention to the existing government of the island of Negros,

constituted, with the approval of the people of that island, under the

order of the Military Governor of July 22, 1899, and after verifying, so

far as may be practicable, the reports of the successful working of that

government they will be guided by the experience thus acquired so far as it

may be applicable to the condition existing in other portions of the

Philippines. They will avail themselves, to the fullest degree practicable,

of the conclusions reached by the previous Commission to the Philippines.

In the distribution of powers among the governments organized by the

Commission, the presumption is always to be in favor of the smaller

subdivision, so that all the powers which can properly be exercised by the

municipal government shall be vested in that government, and all the powers

of a more general character which can be exercised by the departmental

government shall be vested in that government, and so that in the

governmental system, which is the result of the process, the central

government of the islands, following the example of the distribution of the

powers between the States and the National Government of the United States,

shall have no direct administration except of matters of purely general

concern, and shall have only such supervision and control over local

governments as may be necessary to secure and enforce faithful and

efficient administration by local officers.

The many Different degrees of civilization and varieties of custom and

capacity among the people of the different islands preclude very definite

instruction as to the part which the people shall take in the selection of

their own officers; but these general rules are to be observed: That in all

cases the municipal officers, who administer the local affairs of the

people, are to be selected by the people, and that wherever officers of

more extended jurisdiction are to be selected in any way, natives of the

islands are to be preferred, and if they can be found competent and willing

to perform the duties, they are to receive the offices in preference to any

others.

It will be necessary to fill some offices for the present with Americans

which after a time may well be filled by natives of the islands. As soon as

practicable a system for ascertaining the merit and fitness of candidates

for civil office should be put in force. An indispensable qualification for

all offices and positions of trust and authority in the islands must be

absolute and unconditional loyalty to the United States, and absolute and

unhampered authority and power to remove and punish any officer deviating

from that standard must at all times be retained in the hands of the

central authority of the islands.

In all the forms of government and administrative provisions which they are

authorized to prescribe the Commission should bear in mind that the

government which they are establishing is designed not for our

satisfaction, or for the expression of our theoretical views, but for the

happiness, peace, and prosperity of the people of the Philippine Islands,

and the measures adopted should be made to conform to their customs, their

habits, and even heir prejudices, to the fullest extent consistent with the

accomplishment of the Indispensable requisites of just and effective

government.

At the same time the Commission should bear in mind, and the people of the

islands should be made plainly to understand, that there are certain great

principles of government which have been made the basis of our governmental

system which we deem essential to the rule of law and the maintenance of

individual freedom, and of which they have, unfortunately, been denied the

experience possessed by us; that there are also certain practical rules of

government which we have found to be essential to the preservation of these

great principles of liberty and law, and that these principles and these

rules of government must be established and maintained in their islands for

the sake of their liberty and happiness, however much they may conflict

with the customs or laws of procedure with which they are familiar.

It is evident that the most enlightened thought of the Philippine Islands

fully appreciates the importance of these principles and rules, and they

will inevitably within a short time command universal assent. Upon every

division and branch of the government of the Philippines, therefore, must

be imposed these inviolable rules:

That no person shall be deprived of life, liberty, or property without due

process of law; that private property shall not be taken for public use

without just compensation; that in all criminal prosecutions the accused

shall enjoy the right to a speedy and public trial, to be informed of the

nature and cause of the accusation, to be confronted with the witnesses

against him, to have compulsory process for obtaining witnesses in his

favor, and to have the assistance of counsel for his defense; that

excessive bail shall not be required, nor excessive fines imposed, nor

cruel and unusual punishment inflicted; that no person shall be put twice

in jeopardy for the same offense, or be compelled in any criminal case to

be a witness against himself; that the right to be secure against

unreasonable searches and seizures shall not be violated; that neither

slavery nor involuntary servitude shall exist except as a punishment for

crime; that no bill of attainder or ex-post facto law shall be passed; that

no law shall be passed abridging the freedom of speech or of the press, or

the rights of the people to peaceably assemble and petition the Government

for a redress of grievances; that no law shall be made respecting an

establishment of religion, or prohibiting the free exercise thereof, and

that the free exercise and enjoyment of religious profession and worship

without discrimination or preference shall forever be allowed.

It will be the duty of the Commission to make a thorough investigation into

the titles to the large tracts of land held or claimed by individuals or by

religious orders; into the justice of the claims and complaints made

against such landholders by the people of the island or any part of the

people, and to seek by wise and peaceable measures a just settlement of the

controversies and redress of wrongs which have caused strife and bloodshed

in the past. In the performance of this duty the Commission is enjoined to

see that no injustice is done; to have regard for substantial rights and

equity, disregarding technicalities so far as substantial right permits,

and to observe the following rules:

That the provision of the Treaty of Paris pledging the United States to the

protection of all rights of property in the islands, and as well the

principle of our own Government which prohibits the taking of private

property without due process of law, shall not be violated; that the

welfare of the people of the islands, which should be a paramount

consideration, shall be attained consistently with this rule of property

right; that if it becomes necessary for the public interest of the people

of the islands to dispose of claims to property which the Commission finds

to be not lawfully acquired and held disposition shall be made thereof by

due legal procedure, in which there shall be full opportunity for fair and

impartial hearing and judgment; that if the same public interests require

the extinguishment of property rights lawfully acquired and held due

compensation shall be made out of the public treasury therefore; that no

form of religion and no minister of religion shall be forced upon any

community or upon any citizen of the islands; that, upon the other hand, no

minister of religion shall be interfered with or molested in following his

calling, and that the separation between State and Church shall be real,

entire, and absolute.

It will be the duty of the Commission to promote and extend, and, as they

find occasion, to improve the system of education already inaugurated by

the military authorities. In doing this they should regard as of first

importance the extension of a system of primary education which shall be

free to all, and which shall tend to fit the people for the duties of

citizenship and for the ordinary avocations of a civilized community. This

instruction should be given in the first instance in every part of the

islands in the language of the people. In view of the great number of

languages spoken by the different tribes, it is especially important to the

prosperity of the islands that a common medium of communication may be

established, and it is obviously desirable that this medium should be the

English language. Especial attention should be at once given to affording

full opportunity to all the people of the islands to acquire the use of the

English language.

It may be well that the main changes which should be made in the system of

taxation and in the body of the laws under which the people are governed,

except such changes as have already been made by the military government,

should be relegated to the civil government which is to be established

under the auspices of the Commission. It will, however, be the duty of the

Commission to inquire diligently as to whether there are any further

changes which ought not to be delayed, and if so, they are authorized to

make such changes subject to your approval. In doing so they are to bear in

mind that taxes which tend 6 penalize or repress industry and enterprise

are to be avoided; that provisions for taxation should be simple, so that

they may be understood by the people; that they should affect the fewest

practicable subjects of taxation which will serve for the general

distribution of the burden.

The main body of the laws which regulate the rights and obligations of the

people should be maintained with as little interference as possible.

Changes made should be mainly in procedure, and in the criminal laws to

secure speedy and impartial trials, and at the same time effective

administration and respect for individual rights.

In dealing with the uncivilized tribes of the islands the Commission should

adopt the same course followed by Congress in permitting the tribes of our

North American Indians to maintain their tribal organization and

government, and under which many of those tribes are now living in peace

and contentment, surrounded by a civilization to which they are unable or

unwilling to conform. Such tribal governments should, however, be subjected

to wise and firm regulation, and, without undue or petty interference,

constant and active effort should be exercised to prevent barbarous

practices and introduce civilized customs.

Upon all officers and employees of the United States, both civil and

military, should be impressed a sense of the duty to observe not merely the

material but the personal and social rights of the people of the islands,

and to treat them with the same courtesy and respect for their personal

dignity which the people of the United States are accustomed W require from

each other.

The articles of capitulation of the city of Manila on the 13th of August,

1898, concluded with these words:

"This city, its inhabitants, its churches and religious worship, its

educational establishments, and its private property of all descriptions,

are placed under the special safeguard of the faith and honor of the

American Army."

I believe that this pledge has been faithfully kept. As high and sacred an

obligation rests upon the Government of the United States to give

protection for property and life, civil and religious freedom, and wise,

firm, and unselfish guidance in the paths of peace and prosperity to all

the people of the Philippine Islands. I charge this Commission to labor for

the full performance of this obligation, which concerns the honor and

conscience of their country, in the firm hope that through their labors all

the inhabitants of the Philippine Islands may come to look back with

gratitude to the day when God gave victory to American arms at Manila and

set their land under the sovereignty and the protection of the people of

the United States.

Coincidently with the entrance of the Commission upon its labors I caused

to be issued by General MacArthur, the Military Governor of the

Philippines, on June 21, 1900, a proclamation of amnesty in generous terms,

of which many of the insurgents took advantage, among them a number of

important leaders.

This Commission, composed of eminent citizens representing the diverse

geographical and political interests of the country, and bringing to their

task the ripe fruits of long and intelligent service in educational,

administrative, and judicial careers, made great progress from the outset.

As early as August 21, 1900, it submitted a preliminary report, which will

be laid before the Congress, and from which it appears that already the

good effects of returning order are felt; that business, interrupted by

hostilities, is improving as peace extends; that a larger area is under

sugar cultivation than ever before; that the customs revenues are greater

than at any time during the Spanish rule; that economy and efficiency in

the military administration have created a surplus fund of $6,000,000,

available for needed public improvements; that a stringent civil-service

law is in preparation; that railroad communications are expanding, opening

up rich districts, and that a comprehensive scheme of education is being

organized.

Later reports from the Commission show yet more encouraging advance toward

insuring the benefits of liberty and good government to the Filipinos, in

the interest of humanity and with the aim of building up an enduring,

self-supporting, and self-administering community in those far eastern

seas. I would impress upon the Congress that whatever legislation may be

enacted in respect to the Philippine Islands should be along these generous

lines. The fortune of war has thrown upon this nation an unsought trust

which should be unselfishly discharged, and devolved upon this Government a

moral as well as material responsibility toward these millions whom we have

freed from an oppressive yoke.

I have on another occasion called the Filipinos the wards of the nation.

Our obligation as guardian was not lightly assumed; it must not be

otherwise than honestly fulfilled, aiming first of all to benefit those who

have come under our fostering care. It is our duty so to treat them that

our flag may be no less beloved in the mountains of Luzon and the fertile

zones of Mindanao and Negros than it is at home, that there as here it

shall be the revered symbol of liberty, enlightenment, and progress in

every avenue of development.

The Filipinos are a race quick to learn and to profit by knowledge He would

be rash who, with the teachings of contemporaneous history in view, would

fix a limit to the degree of culture and advancement yet within the reach

of these people if our duty toward them be faithfully performed.

The civil government of Puerto Rico provided for by the act of the Congress

approved April 12, 1900 is in successful operation The courts have been

established. The Governor and his associates, working intelligently and

harmoniously, are meeting with Commendable success.

On the 6th of November a general election was held in the island for

members of the Legislature, and the body elected has been called to convene

on the first Monday of December.

I recommend that legislation be enacted by the Congress conferring upon the

Secretary of the Interior supervision over the public lands in Puerto Rico,

and that he be directed to ascertain the location and quantity of lands the

title to which remained in the Crown of Spain at the date of cession of

Puerto Rico to the United States, and that appropriations necessary for

surveys be made, and that the methods of the disposition of such lands be

prescribed by law.

On the 25th of July, 1900, I directed that a call be issued for an election

in Cuba for members of a constitutional convention to frame a constitution

as a basis for a stable and independent government in the island. In

pursuance thereof the Military Governor issued the following instructions:

Whereas the Congress of the United States, by its joint resolution of April

20, 1898, declared:

"That the people of the island of Cuba are, and of right ought to be, free

and independent.

"That the United States hereby disclaims any disposition or intention to

exercise sovereignty, jurisdiction, or control over said island except for

the pacification thereof, and asserts its determination, when that is

accomplished, to leave the government and control of the island to its

people;"

And whereas, the people of Cuba have established municipal governments,

deriving their authority from the suffrages of the people given under just

and equal laws, and are now ready, in like manner, to proceed to the

establishment of a general government which shall assume and exercise

sovereignty, jurisdiction, and control over the island:

Therefore, it is ordered that a general election be held in the island of

Cuba on the third Saturday of September, in the year nineteen hundred, to

elect delegates to a convention to meet in the city of Havana at twelve

o'clock noon on the first Monday of November, in the year nineteen hundred,

to frame and adopt a constitution for the people of Cuba, and as a part

thereof to provide for and agree with the Government of the United States

upon the relations to exist between that Government and the Government of

Cuba, and to provide for the election by the people of officers under such

constitution and the transfer of government to the officers so elected.

The election will be held in the several voting precincts of the island

under, and pursuant to, the provisions of the electoral law of April 18,

1900, and the amendments thereof. The election was held on the 15th of

September, and the convention assembled on the 5th of November, 1900, and

is now in session.

In calling the convention to order, the Military Governor of Cuba made the

following statement: As Military Governor of the island, representing the

President of the United States, I call this convention to order.

It will be your duty, first, to frame and adopt a constitution for Cuba,

and when that has been done to formulate what in your opinion ought to be

the relations between Cuba and the United States.

The constitution must be adequate to secure a stable, orderly, and free

government.

When you have formulated the relations which in your opinion ought to exist

between Cuba and the United States the Government of the United States will

doubtless take such action on its part as shall lead to a final and

authoritative agreement between the people of the two countries to the

promotion of their common interests.

All friends of Cuba will follow your deliberations with the deepest

interest, earnestly desiring that you shall reach just conclusions, and

that by the dignity, individual self-restraint, and wise conservatism which

shall characterize your proceedings the capacity of the Cuban people for

representative government may be signally illustrated.

The fundamental distinction between true representative government and

dictatorship is that in the former every representative of the people, in

whatever office, confines himself strictly within the limits of his defined

powers. Without such restraint there can be no free constitutional

government.

Under the order pursuant to which you have been elected and convened you

have no duty and no authority to take part in the present government of the

island. Your powers are strictly limited by the terms of that order. When

the convention concludes its labors I will transmit to the Congress the

constitution as framed by the convention for its consideration and for such

action as it may deem advisable.

I renew the recommendation made in my special message of February 10, 1899,

as to the necessity for cable communication between the United States and

Hawaii, with extension to Manila. Since then circumstances have strikingly

emphasized this need. Surveys have shown the entire feasibility of a chain

of cables which at each stopping place shall touch on American territory,

so that the system shall be under our own complete control. Manila once

within telegraphic reach, connection with the systems of the Asiatic coast

would open increased and profitable opportunities for a more direct cable

route from our shores to the Orient than is now afforded by the

trans-Atlantic, continental, and trans-Asian lines. I urge attention to

this important matter.

The present strength of the Army is 100,000 men--65,000 regulars and

35,000 volunteers. Under the act of March 2, 1899, on the 30th of June next

the present volunteer force will be discharged and the Regular Army will be

reduced to 2,447 officers and 29,025 enlisted men.

In 1888 a Board of Officers convened by President Cleveland adopted a

comprehensive scheme of coast-defense fortifications which involved the

outlay of something over one hundred million dollars. This plan received

the approval of the Congress, and since then regular appropriations have

been made and the work of fortification has steadily progressed.

More than sixty millions of dollars have been invested in a great number of

forts and guns, with all the complicated and scientific machinery and

electrical appliances necessary for their use. The proper care of this

defensive machinery requires men trained in its use. The number of men

necessary to perform this duty alone is ascertained by the War Department,

at a minimum allowance, to be 18,420.

There are fifty-eight or more military posts in the United States other

than the coast-defense fortifications.

The number of these posts is being constantly increased by the Congress.

More than $22,000,000 have been expended in building and equipment, and

they can only be cared for by the Regular Army. The posts now in existence

and others to be built provide for accommodations for, and if fully

garrisoned require, 26,000 troops. Many of these posts are along our

frontier or at important strategic points, the occupation of which is

necessary.

We have in Cuba between 5,000 and 6,000 troops. For the present our troops

in that island cannot be withdrawn or materially diminished, and certainly

not until the conclusion of the labors of the constitutional convention now

in session and a government provided by the new constitution shall have

been established and its stability assured.

In Puerto Rico we have reduced the garrisons to 1,636, which includes 879

native troops. There is no room for further reduction here.

We will be required to keep a considerable force in the Philippine Islands

for some time to come. From the best information obtainable we will need

there for the immediate future from 45,000 to 60,000 men. I am sure the

number may be reduced as the insurgents shall come to acknowledge the

authority of the United States, of which there are assuring indications.

It must be apparent that we will require an army of about 60,000, and that

during present conditions in Cuba and the Philippines the President should

have authority to increase the force to the present number of 100,000.

Included in this number authority should be given to raise native troops in

the Philippines up to 15,000, which the Taft Commission believe will be

more effective in detecting and suppressing guerrillas, assassins, and

ladrones than our own soldiers.

The full discussion of this subject by the Secretary of War in his annual

report is called to your earnest attention.

I renew the recommendation made in my last annual message 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.

I favor the recommendation of the Secretary of War for the detail oil

officers from the line of the Army when vacancies occur in the

Adjutant-General's Department, Inspector-General's Department,

Quartermaster's Department, Subsistence Department, Pay Department,

Ordnance Department, and Signal Corps.

The Army cannot be too highly commended for its faithful and effective

service in active military operations in the field and the difficult work

of civil administration.

The continued and rapid growth of the postal service is a sure index of the

great and increasing business activity of the country. Its most striking

new development is the extension of rural free delivery. This has come

almost wholly within the last year. At the beginning of the fiscal year

1899, 1900 the number of routes in operation was only 391, and most of

these had been running less than twelve months. On the 15th of November,

1900, the number had increased to 2,614, reaching into forty-four States

and Territories, and serving a population of 1,801,524. The number of

applications now pending and awaiting action nearly equals all those

granted up to the present time, and by the close of the current fiscal year

about 4,000 routes will have been established, providing for the daily

delivery of mails at the scattered homes of about three and a half millions

of rural population.

This service ameliorates the isolation of farm life, conduces to good

roads, and quickens and extends the dissemination of general information.

Experience thus far has tended to allay the apprehension that it would be

so expensive as to forbid its general adoption or make it a serious burden.

Its actual application has shown that it increases postal receipts, and can

be accompanied by reductions in other branches of the service, so that the

augmented revenues and the accomplished savings together materially reduce

the net cost. The evidences which point to these conclusions are presented

in detail in the annual report of the Postmaster-General, which with its

recommendations is commended to the consideration of the Congress. The full

development of this special service, however, requires such a large outlay

of money that it should be undertaken only after a careful study and

thorough understanding of all that it involves.

Very efficient service has been rendered by the Navy in connection with the

insurrection in the Philippines and the recent disturbance in China.

A very satisfactory settlement has been made of the long-pending question

of the manufacture of armor plate. A reasonable price has been secured and

the necessity for a Government armor plant avoided.

I approve of the recommendations of the Secretary for new vessels and for

additional officers and men which the required increase of the Navy makes

necessary. I commend to the favorable action of the Congress the measure

now pending for the erection of a statue to the memory of the late Admiral

David D. Porter. I commend also the establishment of a national naval

reserve and of the grade of vice-admiral. Provision should be made, as

recommended by the Secretary, for suitable rewards for special merit. Many

officers who rendered the most distinguished service during the recent war

with Spain have received in return no recognition from the Congress.

The total area of public lands as given by the Secretary of the Interior is

approximately 1,071,881,662 acres, of which 917,135,880 acres are

undisposed of and 154,745,782 acres have been reserved for various

purposes. The public lands disposed of during the year amount to

13,453,887.96 acres, including 62,423.09 acres of Indian lands, an increase

Of 4,271,474.80 over the preceding year. The total receipts from the sale

of public lands during the fiscal year were $4,379,758.10, an increase of

$1,309,620.76 over the preceding year.

The results obtained from our forest policy have demonstrated its wisdom

and the necessity in the interest of the public for its continuance and

increased appropriations by the Congress for the carrying on of the work.

On June 30, 1900, there were thirty-seven forest reserves, created by

Presidential proclamations under section 24 Of the act of March 3, 1891,

embracing an area Of 46,425,529 acres.

During the past year the Olympic Reserve, in the State of Washington, was

reduced 265,040 acres, leaving its present area at 1,923,840 acres. The

Prescott Reserve, in Arizona, was increased from 10,240 acres to 423,680

acres, and the Big Horn Reserve, in Wyoming, was increased from 1,127,680

acres to 1,180,800 acres. A new reserve; the Santa Ynez, in California,

embracing an area of 145,000 acres, was created during this year. On

October 10, 1900, the Crow Creek Forest Reserve, in Wyoming, was created,

with an area of 56,320 acres.

At the end of the fiscal year there were on the pension roll 993,529 names,

a net increase Of 2,010 over the fiscal year 1899. The number added to the

rolls during the year was 45,344. The amount disbursed for Army pensions

during the year was $134,700,597.24 and for Navy pensions $3,761,533.41, a

total of $138,462,130.65, leaving an unexpended balance of $5,542,768.25 to

be covered into the Treasury, which shows an increase over the previous

year's expenditure Of $107,077.70. There were 684 names added to the rolls

during the year by special acts passed at the first session of the

Fifty-sixth Congress.

The act of May 9, 1900, among other things provides for an extension of

income to widows pensioned under said act to $250 per annum. The Secretary

of the Interior believes that by the operations of this act the number of

persons pensioned under it will increase and the increased annual payment

for pensions will be between $3,000,000 and $4,000,000.

The Government justly appreciates the services of its soldiers and sailors

by making pension payments liberal beyond precedent to them, their widows

and orphans.

There were 26,540 letters patent granted, including reissues and designs,

during the fiscal year ended June 30, 1900; 1,660 trademarks, 682 labels,

and 93 prints registered. The number of patents which expired was 19,988.

The total receipts for patents were $1,358,228.35. The expenditures were

$1,247,827.58, showing a surplus Of $110,400.77

The attention of the Congress is called to the report of the Secretary of

the Interior touching the necessity for the further establishment of

schools in the Territory of Alaska, and favorable action is invited

thereon.

Much interesting information is given in the report of the Governor of

Hawaii as to the progress and development of the islands during the period

from July 7, 1898, the date of the approval of the joint resolution of the

Congress providing for their annexation, up to April 30, 1900, the date of

the approval of the act providing a government for the Territory, and

thereafter.

The last Hawaiian census, taken in the year 1896, gives a total population

of 109,020, Of Which 31,019 were native Hawaiians. The number of Americans

reported was 8,485. The results of the Federal census, taken this year,

show the islands to have a total population Of 154,001, showing an increase

over that reported in 1896 of 44,981, or 41.2 per cent.

There has been marked progress in the educational, agricultural, and

railroad development of the islands.

In the Territorial act of April 30, 1900, section 7 of said act repeals

Chapter 34 Of the Civil Laws of Hawaii whereby the Government was to assist

in encouraging and developing the agricultural resources of the Republic,

especially irrigation. The Governor of Hawaii recommends legislation

looking to the development of such water supply as may exist on the public

lands, with a view of promoting land settlement. The earnest consideration

of the Congress is invited to this important recommendation and others, as

embodied in the report of the Secretary of the Interior.

The Director of the Census states that the work in connection with the

Twelfth Census is progressing favorably. This national undertaking, ordered

by the Congress each decade, has finally resulted in the collection of an

aggregation of statistical facts to determine the industrial growth of the

country, its manufacturing and mechanical resources, its richness in mines

and forests, the number of its agriculturists, their farms and products,

its educational and religious opportunities, as well as questions

pertaining to sociological conditions.

The labors of the officials in charge of the Bureau indicate that the four

important and most desired subjects, namely, population, agricultural,

manufacturing, and vital statistics, will be completed within the limit

prescribed by the law of March 3, 1899.

The field work incident to the above inquiries is now practically finished,

and as a result the population of the States and Territories, including the

Hawaiian Islands and Alaska, has been announced. The growth of population

during the last decade amounts to over 13,000,000, a greater numerical

increase than in any previous census in the history of the country.

Bulletins will be issued as rapidly as possible giving the population by

States and Territories, by minor civil divisions. Several announcements of

this kind have already been made, and it is hoped that the list will be

completed by January 1. Other bulletins giving the results of the

manufacturing and agricultural inquiries will be given to the public as

rapidly as circumstances will admit.

The Director, while confident of his ability to complete the different

branches of the undertaking in the allotted time, finds himself embarrassed

by the lack of a trained force properly equipped for statistical work, thus

raising the question whether in the interest of economy and a thorough

execution of the census work there should not be retained in the Government

employ a certain number of experts not only to aid in the preliminary

organization prior to the taking of the decennial census, but in addition

to have the advantage in the field and office work of the Bureau of trained

assistants to facilitate the early completion of this enormous

undertaking.

I recommend that the Congress at its present session apportion

representation among the several States as provided by the Constitution.

The Department of Agriculture has been extending its work during the past

year, reaching farther for new varieties of seeds and plants; co-operating

more fully with the States and Territories in research along useful lines;

making progress in meteorological work relating to lines of wireless

telegraphy and forecasts for ocean-going vessels; continuing inquiry as to

animal disease; looking into the extent and character of food adulteration;

outlining plans for the care, preservation, and intelligent harvesting of

our woodlands; studying soils that producers may cultivate with better

knowledge of conditions, and helping to clothe desert places with grasses

suitable to our and regions. Our island possessions are being considered

that their peoples may be helped to produce the tropical products now so

extensively brought into the United States. Inquiry into methods of

improving our roads has been active during the year; help has been given to

many localities, and scientific investigation of material in the States and

Territories has been inaugurated. Irrigation problems in our semiarid

regions are receiving careful and increased consideration.

An extensive exhibit at Paris of the products of agriculture has made the

peoples of many countries more familiar with the varied products of our

fields and their comparative excellence.

The collection of statistics regarding our crops is being improved and

sources of information are being enlarged, to the end that producers may

have the earliest advices regarding crop conditions. There has never been a

time when those for whom it was established have shown more appreciation of

the services of the Department.

In my annual message of December 5, 1898, I called attention to the

necessity for some amendment of the alien contract law. There still remain

important features of the rightful application of the eight-hour law for

the benefit of labor and of the principle of arbitration, and I again

commend these subjects to the careful attention of the Congress.

That there may be secured the best service possible in the Philippine

Islands, I have issued, under date of November 30, 1900, the following

order: The United States Civil Service Commission is directed to render

such assistance as may be practicable to the Civil Service Board, created

under the act of the United States Philippine Commission, for the

establishment and maintenance of an honest and efficient civil service in

the Philippine Islands, and for that purpose to conduct examinations for

the civil service of the Philippine islands, upon the request of the Civil

Service Board of said islands, under such regulations as may be agreed upon

by the said Board and the said United States Civil Service Commission. The

Civil Service Commission is greatly embarrassed in its work for want of an

adequate permanent force for clerical and other assistance. Its needs are

fully set forth in its report. I invite attention to the report, and

especially urge upon the Congress that this important bureau of the public

service, which passes upon the qualifications and character of so large a

number of the officers and employees of the Government, should be supported

by all needed appropriations to secure promptness and efficiency.

I am very much impressed with the statement made by the heads of all the

Departments of the urgent necessity of a hall of public records. In every

departmental building in Washington, so far as I am informed, the space for

official records is not only exhausted, but the walls of rooms are lined

with shelves, the middle floor space of many rooms is filled with the

cases, and garrets and basements, which were never intended and are

unfitted for their accommodation, are crowded with them. Aside from the

inconvenience there is great danger, not only from fire, but from the

weight of these records upon timbers not intended for their support. There

should be a separate building especially designed for the purpose of

receiving and preserving the annually accumulating archives of the several

Executive Departments. Such a hall need not be a costly structure, but

should be so arranged as to admit of enlargement from time to time. I

urgently recommend that the Congress take early action in this matter.

I transmit to the Congress a resolution adopted at a recent meeting of the

American Bar Association concerning the proposed celebration of John

Marshall Day, February 4, 1901. Fitting exercises have been arranged, and

it is earnestly desired by the committee that the Congress may participate

in this movement to honor the memory of the great jurist.

The transfer of the Government to this city is a fact of great historical

interest. Among the people there is a feeling of genuine pride in the

Capital of the Republic.

It is a matter of interest in this connection that in 1800 the population

of the District of Columbia was 14,093; to-day it is 278,718. The

population of the city of Washington was then 3,210; to-day it is 218,196.

The Congress having provided for "an appropriate national celebration of

the Centennial Anniversary of the Establishment of the Seat of the

Government in the District of Columbia," the committees authorized by it

have prepared a programme for the 12th of December, 1900, which date has

been selected as the anniversary day. Deep interest has been shown in the

arrangements for the celebration by the members of the committees of the

Senate and House of Representatives, the committee of Governors appointed

by the President, and the committees appointed by the citizens and

inhabitants of the District of Columbia generally. The programme, in

addition to a reception and other exercises at the Executive Mansion,

provides commemorative exercises to be held jointly by the Senate and House

of Representatives in the Hall of the House of Representatives, and a

reception in the evening at the Corcoran Gallery of Art in honor of the

Governors of the States and Territories.

In our great prosperity we must guard against the danger it invites of

extravagance in Government expenditures and appropriations; and the chosen

representatives of the people will, I doubt not, furnish an example in

their legislation of that wise economy which in a season of plenty husbands

for the future. In this era of great business activity and opportunity

caution is not untimely. It will not abate, but strengthen, confidence. It

will not retard, but promote, legitimate industrial and commercial

expansion. Our growing power brings with it temptations and perils

requiring constant vigilance to avoid. It must not be used to invite

conflicts, nor for oppression, but for the more effective maintenance of

those principles of equality and justice upon which our institutions and

happiness depend. Let us keep always in mind that the foundation of our

Government is liberty; its superstructure peace.

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