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.