financial statement required by section 3 of said act of March 2, 1887;
shall ascertain whether the expenditures under the appropriation hereby
made are in accordance with the provisions of said act, and shall make
report thereon to Congress.
In obedience to this law the Department of Agriculture immediately sent out blank forms of expense accounts to each station, and proposes in addition to make, through trusted experts, systematic examination of the several stations during each year for the purpose of acquiring by personal investigation the detailed information necessary to enable the Secretary of Agriculture to make, as the statute provides, a satisfactory report to Congress. The boards of management of the several stations with great alacrity and cordiality have approved the amendment to the law providing this supervision of their expenditures, anticipating that it will increase the efficiency of the stations and protect their directors and managers from loose charges concerning their use of public funds, besides bringing the Department of Agriculture into closer and more confidential relations with the experimental stations, and through their joint service largely increasing their usefulness to the agriculture of the country.
Acting upon a recommendation contained in the report of 1893, Congress
appropriated $10,000 "to enable the Secretary of Agriculture to
investigate and report upon the nutritive value of the various articles
and commodities used for human food, with special suggestions of full,
wholesome, and edible rations less wasteful and more economical than
those in common use."
Under this appropriation the Department has prepared and now has nearly
ready for distribution an elementary discussion of the nutritive value
and pecuniary economy of food. When we consider that fully one-half of
all the money earned by the wage earners of the civilized world is
expended by them for food, the importance and utility of such an
investigation is apparent.
The Department expended in the fiscal year 1893 $2,354,809.56, and out
of that sum the total amount expended in scientific research was 45.6
per cent. But in the year ending June 30, 1894, out of a total
expenditure of $1,948,988.38, the Department applied 51.8 per cent of
that sum to scientific work and investigation. It is therefore very
plainly observable that the economies which have been practiced in the
administration of the Department have not been at the expense of
scientific research.
The recommendation contained in the report of the Secretary for 1893
that the vicious system of promiscuous free distribution of its
departmental documents be abandoned is again urged. These publications
may well be furnished without cost to public libraries, educational
institutions, and the officers and libraries of States and of the
Federal Government; but from all individuals applying for them a price
covering the cost of the document asked for should be required. Thus
the publications and documents would be secured by those who really
desire them for proper purposes. Half a million of copies of the report
of the Secretary of Agriculture are printed for distribution, at an
annual cost of about $300,000. Large numbers of them are cumbering
storerooms at the Capitol and the shelves of secondhand-book stores
throughout the country. All this labor and waste might be avoided if
the recommendations of the Secretary were adopted.
The Secretary also again recommends that the gratuitous distribution of
seeds cease and that no money be appropriated for that purpose except
to experiment stations. He reiterates the reasons given in his report
for 1893 for discontinuing this unjustifiable gratuity, and I fully
concur in the conclusions which he has reached.
The best service of the statistician of the Department of Agriculture
is the ascertainment, by diligence and care, of the actual and real
conditions, favorable or unfavorable, of the farmers and farms of the
country, and to seek the causes which produce these conditions, to the
end that the facts ascertained may guide their intelligent treatment.
A further important utility in agricultural statistics is found in
their elucidation of the relation of the supply of farm products to the
demand for them in the markets of the United States and of the world.
It is deemed possible that an agricultural census may be taken each
year through the agents of the statistical division of the Department.
Such a course is commended for trial by the chief of that division. Its
scope would be:
(1) The area under each of the more important crops.
(2) The aggregate products of each of such crops.
(3) The quantity of wheat and corn in the hands of farmers at a date after the spring sowings and plantings and before the beginning of harvest, and also the quantity of cotton and tobacco remaining in the hands of planters, either at the same date or at some other designated time.
The cost of the work is estimated at $500,000.
Owing to the peculiar quality of the statistician's work and the
natural and acquired fitness necessary to its successful prosecution,
the Secretary of Agriculture expresses the opinion that every person
employed in gathering statistics under the chief of that division
should be admitted to that service only after a thorough, exhaustive,
and successful examination at the hands of the United States Civil
Service Commission. This has led him to call for such examination of
candidates for the position of assistant statisticians, and also of
candidates for chiefs of sections in that division.
The work done by the Department of Agriculture is very superficially
dealt with in this communication, and I commend the report of the
Secretary and the very important interests with which it deals to the
careful attention of the Congress.
The advantages to the public service of an adherence to the principles
of civil-service reform are constantly more apparent, and nothing is so
encouraging to those in official life who honestly desire good
government as the increasing appreciation by our people of these
advantages. A vast majority of the voters of the land are ready to
insist that the time and attention of those they select to perform for
them important public duties should not be distracted by doling out
minor offices, and they are growing to be unanimous in regarding party
organization as something that should be used in establishing party
principles instead of dictating the distribution of public places as
rewards of partisan activity.
Numerous additional offices and places have lately been brought within
civil-service rules and regulations, and some others will probably soon
be included.
The report of the Commissioners will be submitted to the Congress, and
I invite careful attention to the recommendations it contains.
I am entirely convinced that we ought not to be longer without a
national board of health or national health officer charged with no
other duties than such as pertain to the protection of our country from
the invasion of pestilence and disease. This would involve the
establishment by such board or officer of proper quarantine
precautions, or the necessary aid and counsel to local authorities on
the subject; prompt advice and assistance to local boards of health or
health officers in the suppression of contagious disease, and in cases
where there are no such local boards or officers the immediate
direction by the national board or officer of measures of suppression;
constant and authentic information concerning the health of foreign
countries and all parts of our own country as related to contagious
diseases, and consideration of regulations to be enforced in foreign
ports to prevent the introduction of contagion into our cities and the
measures which should be adopted to secure their enforcement.
There seems to be at this time a decided inclination to discuss
measures of protection against contagious diseases in international
conference, with a view of adopting means of mutual assistance. The
creation of such a national health establishment would greatly aid our
standing in such conferences and improve our opportunities to avail
ourselves of their benefits.
I earnestly recommend the inauguration of a national board of health or
similar national instrumentality, believing the same to be a needed
precaution against contagious disease and in the interest of the safety
and health of our people.
By virtue of a statute of the United States passed in 1888 I appointed
in July last Hon. John D. Kernan, of the State of New York, and Hon.
Nicholas E. Worthington, of the State of Illinois, to form, with Hon.
Carroll D. Wright, Commissioner of Labor, who was designated by said
statute, a commission for the purpose of making careful inquiry into
the causes of the controversies between certain railroads and their
employees which had resulted in an extensive and destructive strike,
accompanied by much violence and dangerous disturbance, with
considerable loss of life and great destruction of property.
The report of the commissioners has been submitted to me and will be
transmitted to the Congress with the evidence taken upon their
investigation.
Their work has been well done, and their standing and intelligence give
assurance that the report and suggestions they make are worthy of
careful consideration.
The tariff act passed at the last session of the Congress needs
important amendments if it is to be executed effectively and with
certainty. In addition to such necessary amendments as will not change
rates of duty, I am still very decidedly in favor of putting coal and
iron upon the free list.
So far as the sugar schedule is concerned, I would be glad, under
existing aggravations, to see every particle of differential duty in
favor of refined sugar stricken out of our tariff law. If with all the
favor now accorded the sugar-refining interest in our tariff laws it
still languishes to the extent of closed refineries and thousands of
discharged workmen, it would seem to present a hopeless case for
reasonable legislative aid. Whatever else is done or omitted, I
earnestly repeat here the recommendation I have made in another portion
of this communication, that the additional duty of one-tenth of a cent
per pound laid upon sugar imported from countries paying a bounty on
its export be abrogated. It seems to me that exceedingly important
considerations point to the propriety of this amendment.
With the advent of a new tariff policy not only calculated to relieve
the consumers of our land in the cost of their daily life, but to
invite a better development of American thrift and create for us closer
and more profitable commercial relations with the rest of the world, it
follows as a logical and imperative necessity that we should at once
remove the chief if not the only obstacle which has so long prevented
our participation in the foreign carrying trade of the sea. A tariff
built upon the theory that it is well to check imports and that a home
market should bound the industry and effort of American producers was
fitly supplemented by a refusal to allow American registry to vessels
built abroad, though owned and navigated by our people, thus exhibiting
a willingness to abandon all contest for the advantages of American
transoceanic carriage. Our new tariff policy, built upon the theory
that it is well to encourage such importations as our people need, and
that our products and manufactures should find markets in every part of
the habitable globe, is consistently supplemented by the greatest
possible liberty to our citizens in the ownership and navigation of
ships in which our products and manufactures may be transported. The
millions now paid to foreigners for carrying American passengers and
products across the sea should be turned into American hands.
Shipbuilding, which has been protected to strangulation, should be
revived by the prospect of profitable employment for ships when built,
and the American sailor should be resurrected and again take his
place--a sturdy and industrious citizen in time of peace and a
patriotic and safe defender of American interests in the day of
conflict.
The ancient provision of our law denying American registry to ships
built abroad and owned by Americans appears in the light of present
conditions not only to be a failure for good at every point, but to be
nearer a relic of barbarism than anything that exists under the
permission of a statute of the United States. I earnestly recommend its
prompt repeal.
During the last month the gold reserved in the Treasury for the purpose
of redeeming the notes of the Government circulating as money in the
hands of the people became so reduced and its further depletion in the
near future seemed so certain that in the exercise of proper care for
the public welfare it became necessary to replenish this reserve and
thus maintain popular faith in the ability and determination of the
Government to meet as agreed its pecuniary obligations.
It would have been well if in this emergency authority had existed to
issue the bonds of the Government bearing a low rate of interest and
maturing within a short period; but the Congress having failed to
confer such authority, resort was necessarily had to the resumption act
of 1875, and pursuant to its provisions bonds were issued drawing
interest at the rate of 5 per cent per annum and maturing ten years
after their issue, that being the shortest time authorized by the act.
I am glad to say, however, that on the sale of these bonds the premium
received operated to reduce the rate of interest to be paid by the
Government to less than 3 per cent.
Nothing could be worse or further removed from sensible finance than
the relations existing between the currency the Government has issued,
the gold held for its redemption, and the means which must be resorted
to for the purpose of replenishing such redemption fund when impaired.
Even if the claims upon this fund were confined to the obligations
originally intended and if the redemption of these obligations meant
their cancellation, the fund would be very small. But these obligations
when received and redeemed in gold are not canceled, but are reissued
and may do duty many times by way of drawing gold from the Treasury.
Thus we have an endless chain in operation constantly depleting the
Treasury's gold and never near a final rest. As if this was not bad
enough, we have, by a statutory declaration that it is the policy of
the Government to maintain the parity between gold and silver, aided
the force and momentum of this exhausting process and added largely to
the currency obligations claiming this peculiar gold redemption. Our
small gold reserve is thus subject to drain from every side. The
demands that increase our danger also increase the necessity of
protecting this reserve against depletion, and it is most
unsatisfactory to know that the protection afforded is only a temporary
palliation.
It is perfectly and palpably plain that the only way under present
conditions by which this reserve when dangerously depleted can be
replenished is through the issue and sale of the bonds of the
Government for gold, and yet Congress has not only thus far declined to
authorize the issue of bonds best suited to such a purpose, but there
seems a disposition in some quarters to deny both the necessity and
power for the issue of bonds at all.
I can not for a moment believe that any of our citizens are
deliberately willing that their Government should default in its
pecuniary obligations or that its financial operations should be
reduced to a silver basis. At any rate, I should not feel that my duty
was done if I omitted any effort I could make to avert such a calamity.
As long, therefore, as no provision is made for the final redemption or
the putting aside of the currency obligation now used to repeatedly and
constantly draw from the Government its gold, and as long as no better
authority for bond issues is allowed than at present exists, such
authority will be utilized whenever and as often as it becomes
necessary to maintain a sufficient gold reserve, and in abundant time
to save the credit of our country and make good the financial
declarations of our Government.
Questions relating to our banks and currency are closely connected with
the subject just referred to, and they also present some unsatisfactory
features. Prominent among them are the lack of elasticity in our
currency circulation and its frequent concentration in financial
centers when it is most needed in other parts of the country.
The absolute divorcement of the Government from the business of banking
is the ideal relationship of the Government to the circulation of the
currency of the country.
This condition can not be immediately reached, but as a step in that
direction and as a means of securing a more elastic currency and
obviating other objections to the present arrangement of bank
circulation the Secretary of the Treasury presents in his report a
scheme modifying present banking laws and providing for the issue of
circulating notes by State banks free from taxation under certain
limitations.
The Secretary explains his plan so plainly and its advantages are
developed by him with such remarkable clearness that any effort on my
part to present argument in its support would be superfluous. I shall
therefore content myself with an unqualified indorsement of the
Secretary's proposed changes in the law and a brief and imperfect
statement of their prominent features.
It is proposed to repeal all laws providing for the deposit of United States bonds as security for circulation; to permit national banks to issue circulating notes not exceeding in amount 75 per cent of their paid-up and unimpaired capital, provided they deposit with the Government as a guaranty fund, in United States legal-tender notes, including Treasury notes of 1890, a sum equal in amount to 30 per cent of the notes they desire to issue, this deposit to be maintained at all times, but whenever any bank retires any part of its circulation a proportional part of its guaranty fund shall be returned to it; to permit the Secretary of the Treasury to prepare and keep on hand ready for issue in case an increase in circulation is desired blank national-bank notes for each bank having circulation and to repeal the provisions of the present law imposing limitations and restrictions upon banks desiring to reduce or increase their circulation, thus permitting such increase or reduction within the limit of 75 per cent of capital to be quickly made as emergencies arise.
In addition to the guaranty fund required, it is proposed to provide a
safety fund for the immediate redemption of the circulating notes of
failed banks by imposing a small annual tax, say one-half of 1 per
cent, upon the average circulation of each bank until the fund amounts
to 5 per cent of the total circulation outstanding. When a bank fails
its guaranty fund is to be paid into this safety fund and its notes are
to be redeemed in the first instance from such safety fund thus
augmented, any impairment of such fund caused thereby to be made good
from the immediately available cash assets of said bank, and if these
should be insufficient such impairment to be made good by pro rata
assessment among the other banks, their contributions constituting a
first lien upon the assets of the failed bank in favor of the
contributing banks. As a further security it is contemplated that the
existing provision fixing the individual liability of stockholders is
to be retained and the bank's indebtedness on account of its
circulating notes is to be made a first lien on all its assets.
For the purpose of meeting the expense of printing notes, official
supervision, cancellation, and other like charges there shall be
imposed a tax of say one-half of 1 per cent per annum upon the average
amount of notes in circulation.
It is further provided that there shall be no national-bank notes
issued of a less denomination than $10; that each national bank, except
in case of a failed bank, shall redeem or retire its notes in the first
instance at its own office or at agencies to be designated by it, and
that no fixed reserve need be maintained on account of deposits.
Another very important feature of this plan is the exemption of State
banks from taxation by the United States in cases where it is shown to
the satisfaction of the Secretary of the Treasury and Comptroller of
the Currency by banks claiming such exemption that they have not had
outstanding their circulating notes exceeding 75 per cent of their
paid-up and unimpaired capital; that their stockholders are
individually liable for the redemption of their circulating notes to
the full extent of their ownership of stock; that the liability of said
banks upon their circulating notes constitutes under their State law a
first lien upon their assets; that such banks have kept and maintained
a guaranty fund in United States legal-tender notes, including Treasury
notes of 1890, equal to 30 per cent of their outstanding circulating
notes, and that such banks have promptly redeemed their circulating
notes when presented at their principal or branch offices.
It is quite likely that this scheme may be usefully amended in some of
its details, but I am satisfied it furnishes a basis for a very great
improvement in our present banking and currency system.
I conclude this communication fully appreciating that the
responsibility for all legislation affecting the people of the United
States rests upon their representatives in the Congress, and assuring
them that, whether in accordance with recommendations I have made or
not, I shall be glad to cooperate in perfecting any legislation that
tends to the prosperity and welfare of our country.
GROVER CLEVELAND
***
State of the Union Address
Grover Cleveland
December 2, 1895
To the Congress of the United States:
The present assemblage of the legislative branch of our Government
occurs at a time when the interests of our people and the needs of the
country give especial prominence to the condition of our foreign
relations and the exigencies of our national finances. The reports of
the heads of the several administrative Departments of the Government
fully and plainly exhibit what has been accomplished within the scope
of their respective duties and present such recommendations for the
betterment of our country's condition as patriotic and intelligent
labor and observation suggest.
I therefore deem my executive duty adequately performed at this time by
presenting to the Congress the important phases of our situation as
related to our intercourse with foreign nations and a statement of the
financial problems which confront us, omitting, except as they are
related to these topics, any reference to departmental operations.
I earnestly invite, however, not only the careful consideration but the
severely critical scrutiny of the Congress and my fellow-countrymen to
the reports concerning these departmental operations. If justly and
fairly examined, they will furnish proof of assiduous and painstaking
care for the public welfare. I press the recommendations they contain
upon the respectful attention of those charged with the duty of
legislation, because I believe their adoption would promote the
people's good.
By amendatory tariff legislation in January last the Argentine
Republic, recognizing the value of the large market opened to the free
importation of its wools under our last tariff act, has admitted
certain products of the United States to entry at reduced duties. It is
pleasing to note that the efforts we have made to enlarge the exchanges
of trade on a sound basis of mutual benefit are in this instance
appreciated by the country from which our woolen factories draw their
needful supply of raw material.
The Missions boundary dispute between the Argentine Republic and
Brazil, referred to the President of the United States as arbitrator
during the term of my predecessor, and which was submitted to me for
determination, resulted in an award in favor of Brazil upon the
historical and documentary evidence presented, thus ending a
long-protracted controversy and again demonstrating the wisdom and
desirability of settling international boundary disputes by recourse to
friendly arbitration.
Negotiations are progressing for a revival of the United States and
Chilean Claims Commission, whose work was abruptly terminated last year
by the expiration of the stipulated time within which awards could be
made.
The resumption of specie payments by Chile is a step of great interest
and importance both in its direct consequences upon her own welfare and
as evincing the ascendency of sound financial principles in one of the
most influential of the South American Republics.