MWagnniTaH nrwffwtm
iifftmm; iwrrriVrwttMf
TiriO MKSSAGK.
Prosidont GlovolancVn Addroaa to
l.ho Now Couffvoaa.
X'orclgti Policy of Mm (loveriiinmit Din-
viiPH'il Points In Dlipnld nilli Ureal
Britain liiiiiiiclu I y unit Ion
Dwell Upon ut Length,
Wakiiinotom, Dec. .'I. Tho president
tum'.I In the, following mussiigo to con
gross: foreign Itcluttoin.
Tlio present nisumliliiK" of tlin Joglslutlvo
liriint'li of our government occurs t u tltuo
when Mm Interests of our people mid tlin needs
of tlin country give especial prominence to tho
condition of our foreign relation! itml tho exi
gencies of our nntloiril lliiunccs. Tho reports
of Ihohcndtiof tlin several administrative do
pnrtmonts or tlio government fullv and plainly
exhibit wlmt 1ms been accomplished within
tho scope of Ihelr respective duties mill pro
nont such recommendations for tho hullcr
ment c)f our coutitry'H conilltlou us patriotic
rind Intelligent labor und observations suggest.
I therefore deem my executive duty nilii
pintnly performed nt this tlmo by presenting
lo congress tho Important phases of our sltuu
tlciu ns it-luted to our Intercourse with foreign
nations, inula statement of tho lliiauclal prob
lems which confront un, omitting, except lis
thoy n ro related to these tuples, unv reference
to departmental operations I earnestly In
vito, however, not only tlin caroful cotisldcrn
tlon, lint tlio severely critical scrutiny of thn
congress anil my follow rouiilryinim to tlin re
ports concerning those departmental
operations. If Justly ami fairly oxiim
lnod thoy furnlNh proof of assiduous and
painstaking effort for tho public, welfare.
I press tlm recommendations llinv contain up
on tho respectful attention of thoso charged
villi tho duty of legislation, bcoaiiso I bollnvo
tholr uiloptlou would promoto tho people's
Kood.
My imipiiilatory legislation In January last,
the Argentine Kepulillc. recognizing tlin value
of tho lan;o market opnnnd to tho free Impor
tations of Its wool under tlin last till' I IT act has
udmlttcd curtain products of the United Status
tooutry lit reduced ilutlos. It Is pleasing to
note, that tho efforts wo Imvo mailo to enlarge
thn exchanges of trade on u hound basis of
'mutual lionolltaro In this Instance appreciated
hv tho oouutry from which our woolon facto
ries draw tholr needful supply of raw material
Tlio missions1' boundary dispute between the
Argentine Uopublio and llra.ll, rofurreil to tho
president of tho United Statos us arbitrator
during Uio term of toy predecessor and which
was submitted to mo for determination ro
.Milled In an award In favor of Brazil upon tho
historical and documentary evidence presented,
thus ending a long protruded controversy unit
nguln demonstrating tho wisdom and desira
bility of settling International boundary ills
putoH by recourse tn friendly urbllratlon.
Negotiations uro progressing for a revival of
tho United .States and Chilian claims commis
sion, whoso work wns nbruptly terminated
last year by the expiration or tlio stipulated
tlmo within which awards could be mado
Tlio resumption of specie payments by Chill
Is ti step of Interest and Importance, both In it h
direct consequences upon her own welfare us
evincing tho tendency or sound lliiauclal prin
ciples In oun of tho most lutluuntlal of tho
South American republics.
Tho close of llio momentous strugglo be
tween China ami Japan, while relieving the
diplomatic agents or this government from the
delicate duly they undertook at request of both
countries of tendering such service to subjects
of either belligerent within the territorial limits
of tho other us our neutral position permitted
dovolopod a domestic condition In tho Chinese
empire which has caused much anxiety and
called for prompt and careful attention.
Kllhor us a result of a weak control by the
central government over tho provincial ad
ministrations, following a diminution or tra
ditional government authority under tho
tUross of an overwhelming national disaster,
or u manifestation upon good opportunity of
tho aversion or tho Chinese population to all
foreign ways and undertakings, lhcri have
occurred In widely separated provinces or
China Korious outbreaks or the old
fanatical spirit against foreigners, which,
unchecked by tho local authorities.
lr not actually connived at by them, huvoeul
lulnated In mob attacks on foreign nil-slonaiy
stations, causing much destruction or property
nnd attended with personal Injuries as well us
loss or lire. Although but one American eltl-
icn wns reported to havobeen actually wound
red, uud although tho destruction or property
i may have fallen more heavily upon tho mls
ivdonurles of other nationalities than our own,
U plainly behooved this government to tuUo
the most prompt and decided action to guard
against similar or perhaps more dreadful ca
lamities befalling tho hundreds or American
mission stallons which have grown up
throughout the Interior of China under tho
temperate rule of toleration, custom and Im
perial edict. Tlio demands of tho United
..suites and other powers for tho degradation
mud punishment of tho responsible olllclals or
tho respective cities and provinces who by ucg
lect or otherwise had permitted uprising and
lor the adoption of stem measures by the om-injror-'n
government for tho protection of tho
llfo.iuid property of foreigners, were followed
toy tho disgrace and dismissal or certain pro
vincial olllclals round derelict in duty, nnd tho
punishment by death of a number or those ml-
judged guilty of actual participation In the out
.ratios. The prosidont states that our cordial rela
tions with Franco continues, the only question
or disagreement being the Iniprlsoumontof ox
Consul Waller, mid this, ho says, Is in course
of satisfactory settlement
Our relation with tho states of tho Herman
oinplro nre in some aspects typical or a con
dition or things elsewhere found lu a country
whoso productions und trade uro similar to
our own Tho close rivalries of competing in
dustries; tho intluencu of the delusive
doctrluo that the Internal development
of a nation Is promoted und lis
wealth Increased by a policy which, in under
taking to esorvo Its homo markets for the ex
clusive tifio of Its own producers, necessarily
obstructs their sales in foreign markets and
pravonts free access to the products of tho
world, tho desire to retain trade In time-worn
ruts, regardless of tho Inexorable laws of new
needs and changed conditions of demand and
nupply, and our own halting tardiness lu Invit
ing a freo exchange cf commodities and by this
means Imperiling our rooting In th external
warhols naturally open to us, have rrouted a
situation somewhat Injurious to Ameri
can oxport Interests, not only lu (lor
tnuny, whero thoy nre perhaps most
tiotlcenble, but lu adjacent countries.
Tho exports affected are largely American
cattle and other rood products, tho reason
asslgncd for unfavorable discrimination being
that tholr consumption Is deleterious to the
public health. This Is all tho more irritating
In view or the fact that no European state is
ns Jealous of tho excellence and wholosonio
noss of its exported food supplies us the
United Stutos. nor so enslly able on uccount of
Inherent soundness, to guarantee these qual
ities. Our relations with (Ireat Itrttaln, always
'ntlmutonnd Important, have di'iniitnlod, dur
ing tho past your, even n greater share of con
eidorutlon than Is usual. Several vexatious
iuotlons wore left undetermined by tho do
ifiloo of the Hearing sua arbitration tribunal.
Thn application of thn principle laid down by
that august iimlv has tint, been followed by ttio
results they were In tended to accomplish,
either becau.o the principles themselves
lacked In breadth and dclltiitene'.s or became
their execution has been morn or less Imper
fect. Much correspondence 'as been nxehutiged
between the two governments on the subjuct of
preventing the exterminating slaughter ofsenls.
Tho Insiifllclency of tin; llrlllsh pntrol of the
llehrltig sea under the regulations agreed on
by tho two governments has been pointed out,
und only two IlrltMi ships have done police
duty during this season In these waters, Tho
need of u more oflectlve enforcement of exist
ing regulations, us well us thn adoption of such
nddltlonul regulut Ions as experience has shown
to ho ulisoiut'ly necessity to eurry out the In
tent of the award, havo been earnostly urged
upon the llrlllsh government, but thus far
without effective results. In tho mean time
the depletion of thn seal herds by menns of
pelagic hunting has so alarmingly progressed
that unless their slaughter Is ut once effectively
checked their extinction within a few years
seems to bo a matter of absolute certainty.
The understanding by which the United Statos
was to pay and (ireat Hrltuln to receive u lump
Mini or tl.'.VHU lu full settlement or all IlrlliVii
claims for duiniigcs arising from our seliii n of
British sealing essels unauthorized under tho
award of the I'm Is tribunal or arbitration was
not continued by tho last congress, which de
clined lo make the necessary appropriation. I
am still of the opinion that this arrangement
was a Judicious and advantageous one for the
goverimmiit, and I earnestly recommend that
It be again considered und sanctioned.
It being apparent that the boundary dispute
between (Ireat Hrltuln und the republic of
Vcnc.uolu, concerning thn limits of British
(lulnna was apnroachlng an acute stage, a
delliilte statement of tho Interest and policy of
tho United States as regards tho controversy
seemed to be required, both on lis own uc
count and lu view of Its relations with tho
friendly powers directly concerned, in July
last, llieroforci a dispatch was nil
dressed to our ambassador nt London
ror communication to tho llrlllsh government,
lu which tho altitude or tho United Suites was
rully nnd distinctly set rorth. Tho general
conclusions there reached und formulated are
in substance, ihat the traditional und estab
lished policy or this government Is llrmly op
posed to n forcible Increase by unv Kuropeun
liowor or Us territorial possessions on this
continent: that this policy Is as well founded
lu principle as it Is strongly supported by nu
merous piocedents: that us a consequence tho
UnltedStatos Is bound to protest against tho en
largement of the area of llrlllsh (lulaun in dero
gation of the lights and against the will of
Venezuela; that, considering tho disparity lu
strength or (ireat Hrltuln ami Veneuolu,
the territorial dispute between them can bo
reasonably settled only by friendly and Impar
tial arbitration ami that the resort to such ar
bitration should Include tho whole controversy
nnd Is not satlslled if one of the powers con
cerned is permuted in draw an arbitrary lino
through the territory in debate and to declare
that It will submit to arbitration only tho por
tion lying on one sldeof It. In view of these con
clusions the dispatch In question called upon
the llrlllsh government for a ilctlulto answer
to llio question whether It would or would not
submit the territorial controversy between
Itself und Venezuela lu its entirety lo Impar
tial arbitration.
The answer of the British government 1ms
not yet been received, but Is expected shortly,
when fuilher communication on the subject
will probably bo made to the congress.
(The Hawaiian affair Is hrlotly staled at this
point In the message.
Cuba Is uxaln gravely disturbed, an Insurrec
tion lu some respects more active than the lust
preceding tevolt, which continued from IHiW
to IH78, now exists in a largo iirt or the eastern
Interior or the Island, menacing oven some pop
illations on the coast. Heslilo deranging the
exchanges of the Island, of which our country
takes the predominant share, this (Ingram con
dition of hostilities by arousing sentimental
sympathy und Inciting adventurous support
among our people, has entailed earnest effort
on the part or thlsgiiverniueut to enforce obe
dience to our neutrality laws und to prevent
the territory of the United states from being
abused as a vantage ground fiom which to aid
thoso In arms against Spanish sovereignity.
Whatever may be the traditional sympathy
ir our countrymen UM individuals with people
ho seem to be struggling ror larger autonomy
u nl greater freedom, deepened us such sympa
hy naturally must be in behalf of our neigh
bor, jet the plain duty or their government
Is to observe In good ralth the recognized oil li
gations of International relationship. The
performance of this duty should not bo made
more dttllcult by a disregard on the part of our
citizens of the obligations growing out of their
allegiance to their country, which should re
strain them from violating, us individuals, the
neutrality which Hie nation of which they nre
members is bound to observe In its relations
to friendly sovereign stales.
Occurrences in Turkey havo continued
to excite concern. Tho reported maHsa
ctes of Christians lu Armenia and tho de
velopment there, and lu other districts, of
the spirit of fauaiie hostility to Christian In
lluences u lturally evened apprehension lor
ihe safety of the devoted men and women, who
us dependents of the foreign missionary soci
eties In the United Statos all lesldo In Turkey
under the t'uaranlee of law and usage and In
the legitimate performance of their educa
tional und religions mission. No efforts havo
been spare I in their behalf and tholr protection
in person and properly has been earnestly und
vlgoroush enforce I by every means within our
power. T'ie presence of our naval vessels which
are now m the vicinity of the disturbed localities
affords opportunities to acquire a measure of
familiarity with the coudlttou of affairs und
will enable us to tuUo suitable stop for the
protection of any Interests of our countrymen
within reach of our ships that might bo tound
Imperiled
'I liii I'liianeliil Mtiiatltni.
As wo turn from a review of our foreign re
lations to the contemplation of our national
llnandul situation wo nre immediately aware
that wo approach a subject i domestic con
coin mure important than any other that can
engage our attention nnd one nt present lu
such a perplexing nnd delicate predicament us
to require prompt and wise treatment We
may well bo encouraged to earnest effort lu
this direction when we recall the steps already
taken toward improving our economic und finan
cial situation, und when w e appreciate how w ell
tho way has noon propirod for further progress
by nu uroused and Intelligent popular Interest
In these subjects lly command of the people,
n customs revenue system, dosignod for the
protection and beuellt or favored classes nt tho
expense of the great majority or our country
men and which, whilo Inelilclont Tor the pur
pose of revenue, curtailed our trade relations
and Impeded our entrance to the markets of
Uk world, has been supeioedod by a tar
iff policy which, lu principle is
bused upon a denial of tho right
of the govoruuiout to obstruct tho avenues to
our people's cheap living or lesson tholr com
fort and contentment, for tho sake or accord
ing especial advantages to favorites, and
which, while encouraging our Intercourse and
Hade with other nations, iccoguizo the fuel
that American self-reliance, thrift nnd Inge
nuity enn build up our country s Industries nnd
develop Its icsources moro surely than ener
vating p'ltorualism The couipu..soi-v purchase
tiuil coinage of sliver bv tlio iioverntnent, uu
checksd und unrcgulntod by buslnoss condi
tions rtiid heedless ot our' currency prods,
which for more than tlftoeu years
d luted ottr circulating medium, under
mined conlldcneo abroad in our lluuncinl
ublllty and ut hist culminated iti tllbircbs uud
panto nt homo has been recently stopped by
the repeal of thn laws which forcod this reck
less si heme upon tho country. Tho things
thus ace. mplishcd, notwithstanding tholr
extreme Importance nnd beneficent effects,
fell far short of curing the monetary evils from
which we suffer as a result nf long Indulgence
In ill advised llniuuial expedients. Tho cur
rency denominated United States noton and
commonly known us greenbacks was Issued In
laree volume during the lute civil war and In
tended originally to meet the emergencies or
that period.
it will be seen by n reference t Ho debates
In congress ut the time laws were passed au
thorizing the Issue of these notes that tholr
advocates declared thev were Intended for only
temporary use end to moot the emergency of
war. In almost. If not all, the laws relating to
them some provision was made contemplating
their vo untury or compulsory retirement. A
largo quuntltv of them, however, wore kept on
foot und mingled with tho currency of the
country, so that ut the close of tho your Is; I
thev amounted to t.'llll.uiiu.OT.I. Immediately
after that date und in January, ttfr.", u law was
passed providing for tho resumption or specie
payment, by which tho secret try of the treas
ury was roquhcJ, whenever additional
circulation was Issued to national banks
to retlio United States notes equal lu amount
to so per cent ot such additional national
bank circulation until such notes wore re
duced to MOl.OW.OW. This law further pro
vided thai on and after the Urst day or Janu
ary. I", the United States notes then out
standing should bo redeemed lu coin, nnd In
order to provide nnd prepare ror such re
demption the secretary of the treasury was
authorized not only to use nny surplus reve
nues of tho government, but to Issue bonds of
the United States and dispose of them for
coin und to uso the proceeds for
tho purposes contemplated by tho statute.
In May. IHTH, nnd before the dute thus appoint
ed for tho redemption and retirement or theso
notes, another statue was passed forbidding
their further cancellation and retirement.
Some of them hud, however, been previously
redeemed nnd canceled upon tlio Issue of addi
tional national bank circulation, ns permitted
by the law of 1S7 so that the amount out
standing at the time of the pissago of the net
forbidding their further retirement was .'M,
081,010. Tho law of 1HTH did not stop ut dis
tinct prohibition, but contained, in addition,
the following provision: "And when
uny or said notes may bo redeemed or
bo received Into the treasury, under uny
law, from any source whatever. and
shall belong to tho United States, they shall
not be retired, canceled, or destroyed, but they
shall be reissued nnd made out again and kept
In circulation. This wns tho condition of nf
ruirs on the 1st day of January, IH7D. which hud
been llxed upon four years before us tho dute
for entering upon the redemption nnd retire
ment of ull theso notes, and for which such
abundant means hud been provided. The gov
Lrti'iicut was put lu tho anomalous situation of
owing to the holders of these notes debts pay
able in gold on demand, which could neither bo
retired by receiving such notes lu discharge or
obligations due tho government, nor canceled
by actual payment In gold. It was forced to
redeem without redemption uud to pay without
acquittance.
There lias been Issued and sold ?0:.r)O),OJ0 of
the bonds authorized by the resumption net
of IH7'), the proceeds of which, together with
the gold lu the treasury, created a gold
fund deemed sufllclent to meet tho demands
which might bo made upon it for the redemp
tion of tho outstanding United States notes.
This fund, together with such other gold ns
might be from tlmo to time In the treasury
available for tho same purpose, has been since
called our gold reserve and JIUD.OOJ.iWU has
been regarded us nil adequate amount to ac
complish Its object. This fund amounted on
tho 1st day of January, 1873, to JIH.l'JO.l.'IO
and though thereafter constantly llnctuatlng.
it did not rail below that sum lu July, IS!).!, lu
Aniil. IMiII, ror tho llrst time since its estab
lishment, this reserve amounted to less than
iflOUKXl.OOO, containing ut that dute only 97.
()ll,:i:w. In tlio meantime nnd in July, lk,.H), an
act had been passed directing largo govern
mental monthly purchases or silver than had
been required under previous laws nnd provid
ing that in payment for silver treasury notes
of the United Statos should bo Issued payable
on demand in gold or sliver coin at tho discre
tion of tho secretary or tho treasurv, it was,
however, declared In the act to bo the estab
lished policy or the United States to maintain
the two metals on a purity with ouch
other upon tho present legal ratio, or
such ratio ns may bo provided by law.
lu view of this declaration It was not deemed
permissible for tho secrotnry of tho treisury
to exercise the discretion in terms conferred
on him by refusing to pay gold on these notes
when demanded, because by such discrimina
tion lu favor of the gold dollar, the so-called
parity of the two metals would bo destroyed
and grave und dangerous consequences would
be preeipltuted by ulllrnilug or accentuating
the constantly widening disparity between
their actual value under tho existing ratio.
Theso obligations are tho instruments whloli
ever since wo have had a gold reserve, have
been used to deplete It.
This reserve, us has been stated, had fallen
lu April, ih!i:i, toy7.oi i,:i:i i. it bus from that
time to tho present, with very few and Im
portant movements, steadily decreased, except
us It has boon temporarily replenished by tho
sale or bonds. Among the causes ror this con
stunt und uniform shrinkage in tins fund may
be mentioned the fulling oiT of exports under
tho operation of the tutilT law until recently lu
force, which crippled our exchange of com
modities with foreign nations nnd necessitated
to some extent tlio payment of our balances in
gold tho unnatural infusion of sliver into our
curroncy uud tho increase In agitation
for its freo and unlimited coinage
which havo created apprehension us to our dis
position or ability to continue gold payments,
the consequent hoarding of gold at home and
the stoppage of Investments of foreign capital
us well us the return of our securities already
sold abroad and tho high rate of foreign ex
change, which induce tho shipment of our gold
to be drawn against us us a mutter of specula
tion. In consequence ot these conditions tho
gold reserve on tlio 1st day of February, 18'JI,
was reduced to iVi,4;W,:!77, having lost moro
than jill.i )).() during tlio preceding nine
months, or sinco April, ISM. Us replenishment
being necessary and no other manner of nc
complishlng It being possible, resort wns
had to the issue und sale or bonds pro
vided for by the resumption act or 1875.
Fifty millions of these bonds were sold, yield
ing 15U,0!i:i,,jy.'i.7l, which was added to tho re
serve fuud or gold then on hand. As u result
or this operc.tlon this reserve, which had Mir
rored constant und Urge withdrawals in tho
meantime, stood on the tlth day or March, 1MB,
ntthe sum ot lii?,Hil,H0. Its depiction was,
however. Immediately thereafter so accelerated
that on the ilith day of June, IS'jt. It had fallen
to.Sol.KiH.U'.Ji, thus losing by withdrawals more
than H-U, (K),iK)0 in tlvu months nnd dropping
slightly below this situation when tho su.e of
$.'t).iXA,ik)0 In bonds was effected for Its redemp
tion. This depressed condition grow worse,
and on tho '.'nth day of November, KM,
our gold reserve was drained to 7, (HUM.
It became necessary to again strengthen It.
i'hls was dot.' by another sale of bonds
amounting to f.vi.o w,n m, from which there was
realized .i.s,ft:i,ri'iO with which tho fund was in
creased to lll.DUMKl on tho itli day ot De
comber, 1MB. Again disappointment awaited
tho anxious hopu ror roller. There wns not
even a lull lu tho exasperating withdrawals of
gold. On tho contrary, thoj grow larger und
more persistent than ever, lloiween tho tth
day of December, is'.H, nnd early In February,
IbQj, u pciioa ut bcurculy tuoru tiiau two
mor.ih: nfter tho second rcinrorcemont of our
gold reserve by the sale ot bonds It hud lost
by such withdrawals moro thun $'J9,o)0,o)0, nnd
had fallen to fil,uni,iR. Nearly fia.ooo.eOJ had
been wltdrawn within the month Immediately
preceding this situation.
In this emergency, and In view of its sur
rounding perplexity. It became entirely appar
ent to those upon whom tho struggle for safety
was devolved not only that our gold reserve
must, for the third tlmo In loss thou thirteen
months, bo rostorcd by another Issue and sale
of bonds, bearing a rato of interest nnd badly
suited to tholr purpose, but that a plan must
bo adopted for their disposition promising hot
ter results than real. zed on tho previous salo.s.
An iifrt turnout, therefore, was mndo with a
number or llnanclors und bankers whereby
it was stipulated that bonds de
scribed in tho resumption act or !H7i
paynble In coin thirty yours alter their dato,
boarlntf Interest at tho rate or I percent, per
annum and amounting to about fO.'.ooj.ooO,
should bo exchanged for gold, receivable by
weight, amounting to a llttlo moro than JOS,
OJO.Oui). Its good results could not bo perma
nent. Recent withdrawals have reduced tho
reserve from JI07,67l,il0 on tho OtU day ot July,
lH'J.S, to f7y.3.!8.0C'l
On tho SSth of January, 189 It was reported
by tho secrotnry of tho treasury that moro
than W.MWO.OO) of tho gold had been with
drawn for hoarding or shipment during tho
your preceding. Ho now reports thut from
January I, 187'J. to July II, lH'.n. a period of
more than eleven years, only a llttlo over J3,
OOO.ooo was withdrawn, nnd that between July
1 1, 1891, tho date of the passage of tho law for
nn increased purchase of silver, and tho 1st
day of December, Isy;, or within loss than live
and a half years, thoro was withdrawn nearly
faTJ.OOO.OJO, making u total of moro than $-40.1,-OtKi.OOO
drawn from the treasury gold sinco
January 1, 1879, tho dute llxed In 1S7.' for tho
retirement of the United States notes.
Nearly il.7,00).00u of the gold thus withdrawn
has been paid out on tlimo United States notes,
und yet every ono of tlio $111,000,00:) Is still un
canceled and ready to do service In future
gold depletions. In other words, tho govern
ment has paid In gold more thun nltio-tcnlhs
of its United States notes nnd still owes them
all. It has paid In gold about one-half of Its
notes given for sliver purchases without ex
tinguishing by such payment f 1 ot theso notes.
And uddod to all this wo nre reminded that to
carry out this astounding lliiauclal system the
government has Incurred u bonded Indebted
ness of im.COi.OO) In establishing a gold reserve
und of SIO'.'Jl'i. 10) In elTorts to maintain It.
I nm convinced tho oulv thorough nnd prac
ticable remedy for our troubles Is found In the
retirement and cancellation of our United
States notes, commonly culled greenbacks and
tho outstanding treasury notes issued by the
government in payment of sliver purchased
under the uct of IKU.
Tho currency withdrawn bv tho retirement
of the United State t notes nnd treasury notes,
amounting to probably less than $0,000.0 ),
might be supplied bv such gold us would bo
usee on their retirement or by un Increase In
the clt dilution ot our national banks. Though
the aggregate capital of theso now In existence
amounts to more than idtlil.OO ),000, tholr out
standing circulation based on bond security
amounts to only about $19 1.OOJ.000.
I think they ought to be allowed to Issuo cir
culation equal to the pur value of tho bonds
they deposit to secure it. and Mint tho tax on
theircirculatiou should bo reduced to !of I per
cent., which would undoubtedly meet ull tho
expenses the government Incurs on their no
count. 1 do not overlook tlio fact that the can
cellation of tlio treasury notes Issued under
the silver purchasing act of IS) would leave
the treasury in the actual ownership of sufll
clent silver, including seigniorage to coin
nearly $178,0)0,000 in .standard dollars. It Is
worthy of consideration whether this might
not. from time to tlmo, bo converted Into dol
lurs or fractional colli uud slowly put Into cir
culation. In tho present stage ot our difficulty It Is
not easy to understand how tho amount ot our
revenue receipts directly affects It Tho Im
portant question Is not the quantity of money
received In revenue payments, but tho kind of
money we maintain and our ability to contir.uo
In sound financial conditions. Wo uro consid
ering the government holding of gold as re
lated to the soundness of our money and us af-
foeting our national credit and monetary
strength, ir our gold rcservo had never been
Impaired; If no bonds had been Issued to re
plenish: If there had been no fear und
timidity concerning our ublllty to continue
gold payment; IT uny part or our
revenues were now paid In gold:
uud If wo could look to our gold receipts as a
means of maintaining a safo reserve, tho
amount or our revenues would bo an inlltten
tlal factor in tho problem. Hut unfortunately
ull the circumstances that might lend weight
to this consideration are entirely lacking. In
our present predicament no gold Is recolvod by
the government In payment or revenue chargos,
nor would Micro bo ir tho revenues wore In
creased. Tho receipts or tho treasury when
not in sliver certificates consist ot United
States notes and treasury notes, issued for sil
ver purchases. Theso rorms or monoy are only
usorul to tho government in paying Its cur
rent ordinary expenses and Its quantity
in government possession doos not In the
lenst contribute toward giving us tho kind or
sure lliiauclal standing or condition which Is
built on gold alone. Hit Is said that these
notes if held by tho government can bo used
to obtain gold lor our reserve, tho answer is
easy. The people draw gold from the treas
ury on demand upon United States notes, but
the proposition that tho treasury can on de
mand draw gold from tho people upon thum
would bo regarded in those days with wonder
and amusement. And even If this could ho
done, there Is nothing to prevont thoso thus
parting with their gold from regaining It by
Mm next day or the next hour by the presenta
tion of the notes they recolved.in exchange for it.
Such retention of the metal ought to bo nt
least measurably permanent, and Mils Is pre
cisely what Is prohibited so far as United
Statos notes aro concerned.
By tho law of IS7s. forbidding tholr future
retirement, that statute in so ninny words
provides that thoso notes when received Into
the treasury and belonging to tho United
States shall be "paid out again and kept lu
circulation " It will moreover bo readily soon
that the government could not refuse to pay
out United States notes and treasury notes lu
current transactions when demanded ami In
sist on paying out stiver alone und still
maintain the jsirlty between that metal nnd
tho currency representing gold. Hosldos tho
ncctiuiul lion lu tho treasury of currency of
nny kind exacted from tho peoplo through tax
ation Is justly regarded as an evil and It can
not proceed far without vigorous protect
against an unjustillablo retention of money
from the business of the country and a de
nunciation of a scheme of taxation which
proves Itself to bo unjust whon it takes from
the earnings nnd Inconio of the citizen monoy
so much In excels of tho needs of government
support that large sums can bo guthorcd uud
kept in tho treasury. Sudi a condition was a
peril In tlmo ol .urplus revenue nnd led the gov
ernment to restoro currency to the people by
tho purchase of its unmitured Itondsnt u largo
premium and bv a largo lucre iso of Its depos
its In national banks, und wo cislly remember
that tho nbuio of treasury accumulation has
furnished a most persuasive argument In favor
of legislation radically roduoing our tarilt tax
ation. 1 huve constantly had In mind tho fact that
many of my countrymen, whoso sincerity 1
do not doubt, Insist that Mio euro for tho Ills
now threatening us may bo found In the slnglo
uud simple remedy of the freo coinage of sli
ver. They cuutuuU thai eur mints sValluout
once thrown open to tlfo freo nnd unlimited
und Independent coinage at 1oth gold nnd sil
ver dollars of full legal tender quality, regard
less of the action of tiny other government und
In full view of the fact that the ratio between
the metals which they sugi'cst calls for lot)
cents' worth of gold In the gold dollar at tho
present standard und only 60 cents In Intrinsic
worth of silver In tho silver dollar.
Were there Infinitely stronger reasons than
can be adduced for hoping that such notion
would secure for us a bimetallic curroncy mov
ing on lines of purity, nn experiment so novel
and hazardous as that proposed might well
stagger those who believe that stability Is nn
Imperative condition of sound money. No
government, no human contrivance or net of
legislation has ever been able to hold tho
two metals together In freo colnago at
a ratio nppicclubly different from that which
Is established in tho markets of tho world.
Those who bellovo that our Independent freo
coinage of silver ut nn nrtlllclul ratio with gold
of lilto I would restoro tho parity between tho
metals nnd consequently between tho coins op
poso an unsupported and improbablo theory
to tho bollof and practice of other nations and
tho teachings of tho wisest statesmen nml
economists of the world, both In tho past nnd
present, nnd w hat Is fnr moro conclusive they
run counter to our own actual experiences.
Twice In our curlier history our law makers In
attempting to establish a bimetallic currency
undertook freo colnngo upon a ratio which no
cldentully varies from tho actual rela
tive valuo of the two metals not more than
3 per cent. In both cases, notwithstanding
great dlfllcultles and cost of transportation
thun now exist tho coins whoso Intrinsic worth
were undervalued In tho ratio gradually und
surely disappeared from our circulation and
went to other countries where their resl valuo
was better recognized. Acts of congress wore
Impotent to create equality where natural
onuses decreed even n slight Inequality. Twice
in our recent history we havo signally failed to
ralso by legislation tho valno of silver. Under
an act of congress In 1878 tho government wuh
required for more than eleven years to extend
annually at least $JO,OOJ,000 in tho purchase In
silver bullion for coinage.
Tho act of July H, ISO), In a still boldor ef
fort Increased tho amount of silver the gov
ernment was compelled to purchase and forced
It to become the buyer annually of r 1,000 ,ood
ounces, or practically llio entire product of our
mines. Under both laws silver rapidly and
steadily declined In value. Tho prophecy und
tho expressed hope nnd expectation of thoso
In tho congress, who led In tho passage of tha
lust mentioned net thut It would reestablish,
and maintain the former parity between tha
two metals are still frosh in our memory.
In tho light or those experiences, which ac
cord with the experience or other nations,
there Is certainly no secure ground ror the he
ller that an act or congress could now bridge
an Inequality or W per cent, between gold and
silver at our present ratio, nor Is there the
least possibility that our country, which has
less than one-seventh of tho sllvor money In
tho world, could by Us action alone raise not
only our own but ull silver, to Its lost ratio
w ith gold. Our attempt to accomplish this by
tho free colnago of silver at a ratio differing'
from tho actual rolatlvo valuo would bo the
signal for a complete departure or gold Trout
our circulating, the immediate and largo con
traction or our circulation medium and shrink
age in Mie real value and monetary elllcioucv
of all other forms or currency as thoy settled
to the level of stiver monometallism.
The past Is full of lessons, teaching not only
the economic dangers, but the national Immor
ality thut follows In tho train of such experi
ment. 1 will nut believe thut the American
peoplo can bo persuaded, after sober dellbera
tldti. to jeopardize tholr nation's prestige and
proud standing by encouraging- lliiauclal nos
trums, uor that they will yield to the false al
lurements of cheap monoy. when thoy realize
that it must result In the weakening of that
lliiauclal Integrity and rectitude which thus
far In our history has beon so devotedly cher
ished as ono of tho traits of true Americanism.
Our country's Indebtedness, whether owing;
by tho government or existing between indi
viduals, has been contracted with reference to
our present standard. To decree by net of con
gress that these debts shall bo payable lu less
valuable dollars than thoso within tho con
templation and intention of tho parties w hen
coutractod, would operate to transfer, by tho
Hat of law and without compensation, an
amount of property and a volume of rights and
interests almost incalculable. Thoso who ad
vocate a blind und headlong plunge to freu
eoinago In tho name of bimetallism and pro
fessing tho belief, contrary to all ex
perience, that wo could thus estab
lish a double standard und a
concurrent circulation of both metals in our
coinage aro certainly reckoning from u cloudy
standpoint. Our present standard of valuo Is
the standard of tho civilized world and per
mits tho only bimetallism now possible or nt
least that within the independent reach of nny
single nutlon, however powerful that nation
may be.
There Is n vast dlffcrenco between a stand
ard of valuo uud a curroncy for monetary uso.
The standard must necessarily be llxed und
certain. Tho currency may bo in diverse forms
and r various kinds. No sllvor standard
country has a gold currency In tit dilation, but
an enlightened und wise system or llnatico se
cures tho benelits or both gold und silver us
currency und circulating medium by keeping
the .standard staldu and nil other currency ut
par with it. Such n system and such a stand
ard also gives freo scope for tho uso und ex
pansion of u sufo uud conservative credit
so Indispensable to broad and growing
commercial transactions und so well
substituted lor tho actual uso of money.
If n llxed and staple standard Is mulutuliwd,
such as the magnitude of safety of our com
mercial transactions and business require tho
uso of money Itself Is conveniently minimized.
Kvery dollar of llxed und stable valuo has
brought the agency of contldont credit lu as
tonishing capacity of multiplying itself in
financial work. Kvery unstable and Uuctuat
lng dollar falls as a basis of credit und Its uso
begets gambling speculation und undermines
tho foundations or honest enterprise. I havo
ventured to oxpress mysoU on thoso subjects
with earnestness and plainness of speech be
cause I cannot rid myself of tho holier that
there lurks In the proposition ror the rrco coin
age of silver so strongly approved nttd so en
thusiastically ndTocatod by a multitude
ot my countrymen a serious menace to our
prosperity and un insidious temptation or our
people to wutuler from tho allegiance thev owo
to public and private integrity. It is becuuso
I do not dlstruM tho good faith nnd sincerity
of those who press this scheme that I lmvo Im
perfectly but with ie.il submitted my thoughts:
upon this momentous subject. X cannot ro
rralu from begging them to re-eininlno tholr
views and belters in tho light ot patriots,
reason and familiar experience, nnd to weigh
again and uguln tho consequoncos of such leg
islation us their efforts havo invited. Kvca
the continued agitation of tho subject udds
greatly to the dlfllcultles of a dutigor
ous llnandul situation already forced upon us.
In conclusion 1 especially entreat tho people's
representatives In tho congress who am
charged with tho responsibility of Inaugurat
ing measures for tho safety nnd prosperity of
our common country to promptly und effect
ively conr.ldor tho Ills of our critical llnanclal
Plight. 1 nave suggested n remedy which my
judgmont approves. I doslro, howover, to as
sure tho congress Mint I am prepared tn co
operate witli them In perfecting unv other
measure promising thorough nnd practical ie
lier nnd that I will cludiy labor with them in
every patriotic endeavor to lurthor the Interests
and guard tho welfuro or our countrymen,
whom in our roipectlvo places of duty wo
huve undertaken lu tevvo.
CjUOVEW CltEVELANU
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