As soon as we are in possession of Cuba and have pacified the island it

will be necessary to give aid and direction to its people to form a

government for themselves. This should be undertaken at the earliest moment

consistent with safety and assured success. It is important that our

relations with this people shall be of the most friendly character and our

commercial relations close and reciprocal. It should be our duty to assist

in every proper way to build up the waste places of the island, encourage

the industry of the people, and assist them to form a government which

shall be free and independent, thus realizing the best aspirations of the

Cuban people.

Spanish rule must be replaced by a just, benevolent, and humane government,

created by the people of Cuba, capable of performing all international

obligations, and which shall encourage thrift, industry, and prosperity and

promote peace and good will among all of the inhabitants, whatever may have

been their relations in the past. Neither revenge nor passion should have a

place in the new government. Until there is complete tranquillity in the

island and a stable government inaugurated military occupation will be

continued.

With the one exception of the rupture with Spain, the intercourse of the

United States with the great family of nations has been marked with

cordiality, and the close of the eventful year finds most of the issues

that necessarily arise in the complex relations of sovereign states

adjusted or presenting no serious obstacle to a just and honorable solution

by amicable agreement.

A long unsettled dispute as to the extended boundary between the Argentine

Republic and Chile, stretching along the Andean crests from the southern

border of the Atacama Desert to Magellan Straits, nearly a third of the

length of the South American continent, assumed an acute stage in the early

part of the year, and afforded to this Government occasion to express the

hope that the resort to arbitration, already contemplated by existing

conventions between the parties, might prevail despite the grave

difficulties arising in its application. I am happy to say that

arrangements to this end have been perfected, the questions of fact upon

which the respective commissioners were unable to agree being in course of

reference to Her Britannic Majesty for determination. A residual difference

touching the northern boundary line across the Atacama Desert, for which

existing treaties provided no adequate adjustment, bids fair to be settled

in like manner by a joint commission, upon which the United States minister

at Buenos Ayres has been invited to serve as umpire in the last resort.

I have found occasion to approach the Argentine Government with a view to

removing differences of rate charges imposed upon the cables of an American

corporation in the transmission between Buenos Ayres and the cities of

Uruguay and Brazil of through messages passing from and to the United

States. Although the matter is complicated by exclusive concessions by

Uruguay and Brazil to foreign companies, there is strong hope that a good

understanding will be reached and that the important channels of commercial

communication between the United States and the Atlantic cities of South

America may be freed from an almost prohibitory discrimination.

In this relation I may be permitted to express my sense of the fitness of

an international agreement whereby the interchange of messages over

connecting cables may be regulated on a fair basis of uniformity. The world

has seen the postal system developed from a congeries of independent and

exclusive services into a well-ordered union, of which all countries enjoy

the manifold benefits. It would be strange were the nations not in time

brought to realize that modern civilization, which owes so much of its

progress to the annihilation of space by the electric force, demands that

this all-important means of communication be a heritage of all peoples, to

be administered and regulated in their common behoof. A step in this

direction was taken when the international convention of 1884 for the

protection of submarine cables was signed, and the day is, I trust, not far

distant when this medium for the transmission of thought from land to land

may be brought within the domain of international concert as completely as

is the material carriage of commerce and correspondence upon the face of

the waters that divide them.

The claim of Thomas Jefferson Page against Argentina, which has been

pending many years, has been adjusted. The sum awarded by the Congress of

Argentina was $4,242.35.

The sympathy of the American people has justly been offered to the ruler

and the people of Austria-Hungary by reason of the affliction that has

lately befallen them in the assassination of the Empress-Queen of that

historic realm.

On the 10th of September, 1897, a conflict took place at Lattimer, Pa.,

between a body of striking miners and the sheriff of Luzerne County and his

deputies, in which 22 miners were killed and 44 wounded, of whom 10 of the

killed and 12 of the wounded were Austrian and Hungarian subjects. This

deplorable event naturally aroused the solicitude of the Austro-Hungarian

Government, which, on the assumption that the killing and wounding involved

the unjustifiable misuse of authority, claimed reparation for the

sufferers. Apart from the searching investigation and peremptory action of

the authorities of Pennsylvania, the Federal Executive took appropriate

steps to learn the merits of the case, in order to be in a position to meet

the urgent complaint of a friendly power. The sheriff and his deputies,

having been indicted for murder, were tried, and acquitted, after

protracted proceedings and the hearing of hundreds of witnesses, on the

ground that the killing was in the line of their official duty to uphold

law and preserve public order in the State. A representative of the

Department of Justice attended the trial and reported its course fully.

With all the facts in its possession, this Government expects to reach a

harmonious understanding on the subject with that of Austria-Hungary,

notwithstanding the renewed claim of the latter, after learning the result

of the trial, for indemnity for its injured subjects.

Despite the brief time allotted for preparation, the exhibits of this

country at the Universal Exposition at Brussels in 1897 enjoyed the

singular distinction of a larger proportion of awards, having regard to the

number and classes of articles entered than those of other countries. The

worth of such a result in making known our national capacity to supply the

world's markets is obvious.

Exhibitions of this international character are becoming more frequent as

the exchanges of commercial countries grow more intimate and varied. Hardly

a year passes that this Government is not invited to national participation

at some important foreign center, but often on too short notice to permit

of recourse to Congress for the power and means to do so. My predecessors

have suggested the advisability of providing by a general enactment and a

standing appropriation for accepting such invitations and for

representation of this country by a commission. This plan has my cordial

approval.

I trust that the Belgian restrictions on the importation of cattle from the

United States, originally adopted as a sanitary precaution, will at an

early day be relaxed as to their present features of hardship and

discrimination, so as to admit live cattle under due regulation of their

slaughter after landing. I am hopeful, too, of favorable change in the

Belgian treatment of our preserved and salted meats. The growth of direct

trade between the two countries, not alone for Belgian consumption and

Belgian products, but by way of transit from and to other continental

states, has been both encouraging and beneficial. No effort will be spared

to enlarge its advantages by seeking the removal of needless impediments

and by arrangements for increased commercial exchanges.

The year's events in Central America deserve more than passing mention.

A menacing rupture between Costa Rica and Nicaragua was happily composed by

the signature of a convention between the parties, with the concurrence of

the Guatemalan representative as a mediator, the act being negotiated and

signed on board the United States steamer Alert, then lying in Central

American waters. It is believed that the good offices of our envoy and of

the commander of that vessel contributed toward this gratifying outcome.

In my last annual message the situation was presented with respect to the

diplomatic representation of this Government in Central America created by

the association of Nicaragua, Honduras, and Salvador under the title of the

Greater Republic of Central America, and the delegation of their

international functions to the Diet thereof. While the representative

character of the Diet was recognized by my predecessor and has been

confirmed during my Administration by receiving its accredited envoy and

granting exequaturs to consuls commissioned under its authority, that

recognition was qualified by the distinct understanding that the

responsibility of each of the component sovereign Republics toward the

United States remained wholly unaffected.

This proviso was needful inasmuch as the compact of the three Republics was

at the outset an association whereby certain representative functions were

delegated to a tripartite commission rather than a federation possessing

centralized powers of government and administration. In this view of their

relation and of the relation of the United States to the several Republics,

a change in the representation of this country in Central America was

neither recommended by the Executive nor initiated by Congress, thus

leaving one of our envoys accredited, as heretofore, separately to two

States of the Greater Republic, Nicaragua and Salvador, and to a third

State, Costa Rica, which was not a party to the compact, while our other

envoy was similarly accredited to a union State, Honduras, and a nonunion

State, Guatemala. The result has been that the one has presented

credentials only to the President of Costa Rica, the other having been

received only by the Government of Guatemala.

Subsequently the three associated Republics entered into negotiations for

taking the steps forecast in the original compact. A convention of their

delegates framed for them a federal constitution under the name of the

United States of Central America, and provided for a central federal

government and legislature. Upon ratification by the constituent States,

the 1st of November last was fixed for the new system to go into operation.

Within a few weeks thereafter the plan was severely tested by revolutionary

movements arising, with a consequent demand for unity of action on the part

of the military power of the federal States to suppress them. Under this

strain the new union seems to have been weakened through the withdrawal of

its more important members. This Government was not officially advised of

the installation of the federation and has maintained an attitude of

friendly expectancy, while in no wise relinquishing the position held from

the outset that the responsibilities of the several States toward us

remained unaltered by their tentative relations among themselves.

The Nicaragua Canal Commission, under the chairmanship of Rear-Admiral John

G. Walker, appointed July 24, 1897, under the authority of a provision in

the sundry civil act of June 4 of that year, has nearly completed its

labors, and the results of its exhaustive inquiry into the proper route,

the feasibility, and the cost of construction of an interoceanic canal by a

Nicaraguan route will be laid before you. In the performance of its task

the commission received all possible courtesy and assistance from the

Governments of Nicaragua and Costa Rica, which thus testified their

appreciation of the importance of giving a speedy and practical outcome to

the great project that has for so many years engrossed the attention of the

respective countries.

As the scope of the recent inquiry embraced the whole subject, with the aim

of making plans and surveys for a canal by the most convenient route, it

necessarily included a review of the results of previous surveys and plans,

and in particular those adopted by the Maritime Canal Company under its

existing concessions from Nicaragua and Costa Rica, so that to this extent

those grants necessarily hold as essential a part in the deliberations and

conclusions of the Canal Commission as they have held and must needs hold

in the discussion of the matter by the Congress. Under these circumstances

and in view of overtures made to the Governments of Nicaragua and Costa

Rica by other parties for a new canal concession predicated on the assumed

approaching lapse of the contracts of the Maritime Canal Company with those

States, I have not hesitated to express my conviction that considerations

of expediency and international policy as between the several governments

interested in the construction and control of an interoceanic canal by this

route require the maintenance of the status quo until the Canal Commission

shall have reported and the United States Congress shall have had the

opportunity to pass finally upon the whole matter during the present

session, without prejudice by reason of any change in the existing

conditions.

Nevertheless, it appears that the Government of Nicaragua, as one of its

last sovereign acts before merging its powers in those of the newly formed

United States of Central America, has granted an optional concession to

another association, to become effective on the expiration of the present

grant. It does not appear what surveys have been made or what route is

proposed under this contingent grant, so that an examination of the

feasibility of its plans is necessarily not embraced in the report of the

Canal Commission. All these circumstances suggest the urgency of some

definite action by the Congress at this session if the labors of the past

are to be utilized and the linking of the Atlantic and Pacific oceans by a

practical waterway is to be realized. That the construction of such a

maritime highway is now more than ever indispensable to that intimate and

ready intercommunication between our eastern and western seaboards demanded

by the annexation of the Hawaiian Islands and the prospective expansion of

our influence and commerce in the Pacific, and that our national policy now

more imperatively than ever calls for its control by this Government, are

propositions which I doubt not the Congress will duly appreciate and wisely

act upon.

A convention providing for the revival of the late United States and

Chilean Claims Commission and the consideration of claims which were duly

presented to the late commission, but not considered because of the

expiration of the time limited for the duration of the commission, was

signed May 24, 1897, and has remained unacted upon by the Senate. The term

therein fixed for effecting the exchange of ratifications having elapsed,

the convention falls unless the time be extended by amendment, which I am

endeavoring to bring about, with the friendly concurrence of the Chilean

Government.

The United States has not been an indifferent spectator of the

extraordinary events transpiring in the Chinese Empire, whereby portions of

its maritime provinces are passing under the control of various European

powers; but the prospect that the vast commerce which the energy of our

citizens and the necessity of our staple productions for Chinese uses has

built up in those regions may not be prejudiced through any exclusive

treatment by the new occupants has obviated the need of our country

becoming an actor in the scene. Our position among nations, having a large

Pacific coast and a constantly expanding direct trade with the farther

Orient, gives us the equitable claim to consideration and friendly

treatment in this regard, and it will be my aim to subserve our large

interests in that quarter by all means appropriate to the constant policy

of our Government. The territories of Kiao-chow, of Wei-hai-wei, and of

Port Arthur and Talienwan, leased to Germany, Great Britain, and Russia,

respectively, for terms of years, will, it is announced, be open to

international commerce during such alien occupation; and if no

discriminating treatment of American citizens and their trade be found to

exist or be hereafter developed, the desire of this Government would appear

to be realized.

In this relation, as showing the volume and value of our exchanges with

China and the peculiarly favorable conditions which exist for their

expansion in the normal course of trade, I refer to the communication

addressed to the Speaker of the House of Representatives by the Secretary

of the Treasury on the 14th of last June, with its accompanying letter of

the Secretary of State, recommending an appropriation for a commission to

study the commercial and industrial conditions in the Chinese Empire and

report as to the opportunities for and obstacles to the enlargement of

markets in China for the raw products and manufactures of the United

States. Action was not taken thereon during the late session. I cordially

urge that the recommendation receive at your hands the consideration which

its importance and timeliness merit.

Meanwhile there may be just ground for disquietude in view of the unrest

and revival of the old sentiment of opposition and prejudice to alien

people which pervades certain of the Chinese provinces. As in the case of

the attacks upon our citizens in Szechuen and at Kutien in 1895, the United

States minister has been instructed to secure the fullest measure of

protection, both local and imperial, for any menaced American interests,

and to demand, in case of lawless injury to person or property, instant

reparation appropriate to the case. War ships have been stationed at

Tientsin for more ready observation of the disorders which have invaded

even the Chinese capital, so as to be in a position to act should need

arise, while a guard of marines has been sent to Peking to afford the

minister the same measure of authoritative protection as the

representatives of other nations have been constrained to employ.

Following close upon the rendition of the award of my predecessor as

arbitrator of the claim of the Italian subject Cerruti against the Republic

of Colombia, differences arose between the parties to the arbitration in

regard to the scope and extension of the award, of which certain articles

were contested by Colombia, while Italy claimed their literal fulfillment.

The award having been made by the President of the United States, as an act

of friendly consideration and with the sole view to an impartial

composition of the matter in dispute, I could not but feel deep concern at

such a miscarriage, and while unable to accept the Colombian theory that I,

in my official capacity, possessed continuing functions as arbitrator, with

power to interpret or revise the terms of the award, my best efforts were

lent to bring the parties to a harmonious agreement as to the execution of

its provisions.

A naval demonstration by Italy resulted in an engagement to pay the

liabilities claimed upon their ascertainment; but this apparent disposition

of the controversy was followed by a rupture of diplomatic intercourse

between Colombia and Italy, which still continues, although, fortunately,

without acute symptoms having supervened. Notwithstanding this, efforts are

reported to be continuing for the ascertainment of Colombia's contingent

liability on account of Cerruti's debts under the fifth article of the

award.

A claim of an American citizen against the Dominican Republic for a public

bridge over the Ozama River, which has been in diplomatic controversy for

several years, has been settled by expert arbitration and an award in favor

of the claimant amounting to about $90,000. It, however, remains unpaid,

despite urgent demands for its settlement according to the terms of the

compact.

There is now every prospect that the participation of the United States in

the Universal Exposition to be held in Paris in 1900 will be on a scale

commensurate with the advanced position held by our products and industries

in the world's chief marts.

The preliminary report of Mr. Moses P. Handy, who, under the act approved

July 19, 1897, was appointed special commissioner with a view to securing

all attainable information necessary to a full and complete understanding

by Congress in regard to the participation of this Government in the Paris

Exposition, was laid before you by my message of December 6, 1897, and

showed the large opportunities opened to make known our national progress

in arts, science, and manufactures, as well as the urgent need of immediate

and adequate provision to enable due advantage thereof to be taken. Mr.

Handy's death soon afterwards rendered it necessary for another to take up

and complete his unfinished work, and on January 11 last Mr. Thomas W.

Cridler, Third Assistant Secretary of State, was designated to fulfill that

task. His report was laid before you by my message of June 14, 1898, with

the gratifying result of awakening renewed interest in the projected

display. By a provision in the sundry civil appropriation act of July 1,

1898, a sum not to exceed $650,000 was allotted for the organization of a

commission to care for the proper preparation and installation of American

exhibits and for the display of suitable exhibits by the several Executive

Departments, particularly by the Department of Agriculture, the Fish

Commission, and the Smithsonian Institution, in representation of the

Government of the United States.

Pursuant to that enactment I appointed Mr. Ferdinand W. Peck, of Chicago,

commissioner-general, with an assistant commissioner-general and a

secretary. Mr. Peck at once proceeded to Paris, where his success in

enlarging the scope and variety of the United States exhibit has been most

gratifying. Notwithstanding the comparatively limited area of the

exposition site--less than one-half that of the World's Fair at

Chicago--the space assigned to the United States has been increased from

the absolute allotment of 157,403 square feet reported by Mr. Handy to some

202,000 square feet, with corresponding augmentation of the field for a

truly characteristic representation of the various important branches of

our country's development. Mr. Peck's report will be laid before you. In my

judgment its recommendations will call for your early consideration,

especially as regards an increase of the appropriation to at least one

million dollars in all, so that not only may the assigned space be fully

taken up by the best possible exhibits in every class, but the preparation

and installation be on so perfect a scale as to rank among the first in

that unparalleled competition of artistic and inventive production, and

thus counterbalance the disadvantage with which we start as compared with

other countries whose appropriations are on a more generous scale and whose

preparations are in a state of much greater forwardness than our own.

Where our artisans have the admitted capacity to excel, where our inventive

genius has initiated many of the grandest discoveries of these later days

of the century, and where the native resources of our land are as limitless

as they are valuable to supply the world's needs, it is our province, as it

should be our earnest care, to lead in the march of human progress, and not

rest content with any secondary place. Moreover, if this be due to

ourselves, it is no less due to the great French nation whose guests we

become, and which has in so many ways testified its wish and hope that our

participation shall befit the place the two peoples have won in the field

of universal development.

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