THE AMIRS OF STATE.
As Fully Set Forth in the An
nual Message of President - -
dent Arthur.
Relations of This Government
With Foreign Nations of an
Amicable Nature.
Onr Interests at Home and Abroad
Freely , Fnllj and Interestingly
Discusssed.
FOREIGN AFFAIRS.
To the Congress of the United States :
At the tbrcHbold of your deliberation I
congratulate you upon the favorable aspec
of the domestic and foreign affairs of tbi ;
government. Otir relations with other na
tions continue to be on a friendly footing
with the Argentine Itcpublle , liclgiuiu ,
Brazil , Denmark , Hayti , Italy , San Domin
go , Sweden and Norway. No incident
has occurred which calls for special com
ment. The recent opening of new
lines of telegraphic communication
with Central America and Brazil ,
permitted the interchange of mes
sages of friendship with the governments
of those countries. Dining the year there
have been perfected and proclaimed consu
lar and commercial treaties with Servia and
a consular treaty with Itoumania , thus ex
tending intercourse with the Danubian
countries , while our eastern relations have
been upon a wide. basis by treaties with
Corea and Madagascar. The new boundary
survey treaties with Mexico , and trades-
mark convention , and as a supplementary
the treaty of the extradition with Spain , ancl
the convention extending the duration of
the Franco-American claims commission
have also been proclaimed.
THE FISHERIES.
Notice of the termination f the fisheries
articles of the treaty of "Wasliingtou was
duly given to the British government.
The privileges and exemptions of the British
government , and the privileges and exemp
tions of the treaty will accordingly close on
July 1 , 1885. The fisheries industry pur
sued by a numerous class of our citi/e'ns on
the northern coasts , both of the Atlantic
and Pacific oceans , are worthy of the foster
ing of congress , whenever brought into
competition with like industries of other
countries. Our fishermen , as well as our
manufacturers of fishing appliances and
preparers of fish products , have maintained
a foremost place. 1 suggest that congress
create a commission to consider the question
of our rights in the fisheries , and the means
of opening to our citizens , under just and
enduring conditions , the rich stocked fish
ing waters and whaling grounds of British
urid Hussiau North America.
1'AUFER IMMIGRATION.
A question has arisen touching the im
portation to the United States from the
British islands by governmental or muni
cipal aid of persons unable there to gain a
living , and equally a burden on the commu
nity here. Such of these persons , under
the pauper class , as defined by the law ,
have been scut back in accordance withihe
provisions of our statutes. Her majesty's
government has insisted that precautions
nave been taken before shipment. They
have , however , in ao many cases proven in
effectual , and especially so in certain recent
instances of needy immigrants reaching our
secretary through Canada , that a revision of
our legislation upon this subject may be
deemed advisable. Correspondence rela
tive to the Clayton-Bulwer treaty has been
continued and will bo laid before commit
tees.
THE AMERICAN IIOQ ABROAD.
The legislation of France against the im
portation of prepared swine produce has
been repealed. The result has been no less
due to the friendly representations of this
government than to the growing conviction
In France that the restriction is not demand
ed by any real danger to health. Germany
still prohibits the introduction of swine
products from America. I extended to the
imperial government a friendly invitation to
send experts to the United States to inquire
whether the use of these products was dan
gerous to health. This invitation was de
clined. I have believed it of such impor
tance , however , that the exact facts should
"be ascertained and promulgated that I have
appointed a competent commission to make
a thorough investigation of the subject. Its
members have shown their public spirit by
accepting their trust without pledge of com
pensation , but I trust that congress will see
in the national and International bearings of
the matter a sufiicient motive of providing
at least for the reimbursement for such ex
pense as they may ifecessarily incur.
THE RUSSIAN BEAR.
The coronation of the czar at Moscow af
forded to this government an occasion for
testyfying its continued friendship by send
ing a special envoy a representative of the
navy to attend the ceremony. While there
lave arisen no grave questions affecting the
status in the Russian empire of American
citizens of other faith than that held r-y the
National church , this government remains
firm in its convictions that the rights of citi
zens abroad should be in no way affected
by tneir religious belief.
CUBA AND PORTO KICO.
It-is understood that measures for the re
moval of the restrictions whieh now burden
our trade with Cuba and Porto Ilico are un
der consideration by the Spanish govern
ment. The proximity of Cuba and the pe
culiar method of administration which there
prevails nccesltates constant discussion and
appeal on our part from the proceedings
this insular uutiiorities. I regret to say that
the just protests of this government have
not as yet produced satisfactory results.
The commission appointed to decido.certain
claims of our citizens against the Spanish
government , after their recognition of a satisfactory
is-factory rule as to the validity of the case. ,
and force of naturalization in the United
States , has finally adjourned. Some of its
awards , though made-morc-than two years
ago. huve not as yet been paid. The specie
pHvinent in expected claims to a large
wh'ich were held by the late commission
without its jurisdiction , ha ? been diplomat
ically presenfed to the Spanish government.
As the action of thnso colonial authorities
which has given rise to those claims was ad
mitted to bo illegal , full reparation for the
injuries sustained by our citizens should , be
no longer delayed. The case of the Masonic
1ms not yet reached H settlement. The Ma
nila court has found that tae proceedings ,
of which this government has complained ,
were unauthorized , and it is hoped that the
government of SHtn will not withhold its
speedy reparation which it" scu e of Justice
bbould impel it to offer for the umieual se- ,
veritv and unjust action of ib subordinate j
colonial officers in the ease of this veHl.
SWITZERLAND.
The Helvetian confederation haspropoeed
the inauguration of n class of international
treaties for the deferment of arbitration of
grave questions between nations. This gov
ernment has assented to the proposed nego
tiations of such a treaty with Switzerland.
Under the treaty of Berlin the liberty of
conscience and civil rights are assured to all
strangers in Bulgaria.
BULGARIA.
As the United States have no distinct con
ventional relations with that country , and
are not a party to the treaty , they should ,
in my opinion , maintain diplomatic repre
sentation at Sofia for the improvement of in
tercourse , and the proper protection of the
many American citizens who resort to that
country as missionaries and strangers. I
suggest that I be given authority to establish
an agency and consulate general at the Bul
garian capital.
TURKEY AND EGYPT.
The United States ire now participating
in a revision of the tariffs of the Ottoman
empire. They have assented to theapplica-
tion of a license tax of foreigners doing
business in Turkey , but have opposed the
oppressive storage tax upon petroleum en
tering the port of that country. The gov
ernment of the khedlve has proposed that
the authority of the mixed judicial tribunals
in Egypt be extended so as to cover citizens
of the United States accused of crime , who
are now tried before consular courts. This
government is not indisposed to accept the
change but believes that its terms should be
submitted for criticism to the commission
aproluted to revise the whole subject.
RELATIONS WITH MEXICO.
At no time in our national history has
there been more manifest need of close and
lasting negotiations with a neighboring state
than now exists with respect to .Mexico. The
rapid influx of our capital and enterprise
into that countrv shows what has been ac
complished by the vast reciprocal advantages
which must attend the progress of its inter
nal developments. I'he treaty of commerce
and navigation of 1848 has been termin
ated by the Mexican government , and the
absence of conventional engagements , the
rights of our citizens in Mexico , now de
pend upon the domestic status of that re
public. There have been instances of harsh
infringement of laws against our vessels to
citizens in Mexico , and of denial of diplo
matic resort for their protection. The ini
tial step toward a better understanding has
been taken in the negotiations by the com
mission anthorizad by congress , of a treaty
which is still before the senate awaiting its
approval , the provisions for the reciprocal
crossing of the frontier by the troops In
pursuit of hostile Indians "have been pro
longed for anotker year. The operations of
the forces of both governments against the
savages have been successful and several of
their most dangerous bunds have eeeu cap
tured or dispersed by the skill and valor of
the United States and Mexican soldiers fight
ing in a common cause.
The convention for the resurvey of the
boundary from the llio Grar de to the Pa
cific , having been ratified and exchanged ,
the preliminary reconnoisame therein stip
ulated has been effected , and it now rests
with congress to make provision for cjm-
pleting the survey and reseating the boun
dary monuments. A convention was signed
with Mexico on July 13 , 1882 , providing for
the rehearing of the case of Benjamin
} Veiles Vd. the Abra Silver Mining company ,
in whose favor awards were made by the
late Amerifiui claims commission. "That"
convention still awaits the consent of the
senate. Meanwhile , because of this charges
of fraudulent awards which have made a
new commission necessary , the executive
has directed the suspension of payments of
the distributive quota received from Mex
ico.
CENTRAL AMERICA , BOLIVIA , CHILI AND
TKKU.
Our geographical proximitv to Central
America and our political and commercial
relations with the states of that country jus
tify , in my judgment , such a material in
crease of our consular corps as will place at
each capital a consul-general. The contest
between Bolivia. Chill and Peru has passed
from the stage of strategic hostilities to that
of negotiation , in which the counsels of this
government have been exercised. The de
mands of Chill for an absolute cession of
territory have been maintained and accepted
by the party of General Iglesias to the ex
tent of concluding a treaty of peace with the
government of Chiii in general conformity
with the terms of the protocol signed in
May last between the Chilian commander
and General Iglesias. As a result of the
conclusion of this treaty General Iglesias
has been formally recognized by Chili as
president of Peru , and his government in
stalled at Lima , which has been evacuated
by the Chilians. A call has been issued by-
General Iglesias for a representative assem
bly to be elected on the 13th of January and
to meet at Lima on the 1st of March next.
Meanwhile the provisional government of
Gen. Iglesias has applied for recognition to
the principal powers of America and Europe.
When the will of the Peruvian people shall
be manifested , I shall not hesitate to recog
nize the government approved by them.
Diplomatic and naval representative * of this
government attended at Caracas the centen
nial celebration of the birth of the illustri
ous Bolivar. At the name time the iuuigu-
nitiou of the statue of Washington in the
Veuzuelan capital testified the devotion In
kvuich his memory Is held there.
VENEZUELA.
Congress at its last session authorized the
executive to propose to the Venezuelan gov
ernment , a reopening of the awards of the
mixed commission of Carcaw. The depart
ure from this countrv of the Venezuelan
minister has delayed the opening of negotia
tions for reviewing the commission. This
zovernment holds that until the re-cstab-
lishment of a treaty on this subject the Ven
ezuelan government mu t continue to make
the payments provided for in the constitu
tion of 18-.6.
There is ground for believing that the dis
pute growing out of the. unpaid obligations
ilue from Venezuela to France will bo satisfactorily -
factorily adjusted. The French cabinet has.
proposed : i ba i of settlement which meets
my approval , but as it involves a recasting
of" the annual quotas of the foreign debt it
bos been deemed advisable to submit the
propo.-al-to the Judgment of the cabinets of
of Berlin , Copenhagen , The Hague , London
and Madrid.
Madrid.SANDWICH
SANDWICH ISLANDS.
At the recent coronation of his majesty ,
King Kulakaua. this government was repre
sented both diplomatically and by the formal
visit of a vessel of war.
The question of terminating or modifying
the existing reciprocity treaty with Hawaii
is now before eoncfcss. I'ani convinced
that thc > charge * of abuco aud frauds under
that treaty have liven exaggerated , and I
renew the stigzeition of last'year's mc--'aue
that the treaty be modified whenever its pro-
virion * have proved om-rous to legitimate
trade between the two countries. I am not
ilispojt'd to favor the entire cessation of
treaty relations1 which h.tve fo-tered good
will between the countries nutl contributed
toward the equality of Hawaii iu the family
of nations.
PERSIA , MAM AND CORHV.
la pursuance of the policy declared " by
Hiss government of extending our inter
course with the eastern-nations , negotia
tions have , during the ] ) $ . year , been es
tablished with Persia. Siain Had Corea. It
j > > probable that permanent iaispn of lho u
countries will "crc long be maintained In
the United States. A special embassy from
Slamis on its'way hither. Treaty relations
with Corea were perfected by the exchange
at Zeoul , on the 10th of May last , of the
ratifications of the lately concluded conven
tion and envoys from the king of Tahchosu'n
havevisited this country and received a cor
dial welcome. Corea , yet unacquainted with
shejmethods of westerncivihzution , now in
vites the attention of those interested in the
foreign trades. AH it needs the implements
and products which the United States arc
ready to supply , we seek no monopoly of its
commerce and no advantages over other na
tions. But as the Chinese , in reaching a
far higher civilization , have confided in this
republic , we cannot regard with Indiffer
euce , any encroachments on their rights.
CHINA AND JAPAN.
China , by the payment of a money indem
nity , has settled certain of the long pending
claims of our citizens , and I have strong
hopes that the remainder will soon be ad
justed. Questions having arisen touching
the rights of American and other foreigr
manufacturers in Cbim. under the provis
ions of treaties which permit aliens to exer
else their industries in that country , and 01
this specefio point our own treaty is silent ,
but under the operation of the "most fa
vored nations clause , " wo have like privi
leges with those of other nations , and it Is
the duty of the government to see that our
citizens have the full enjoyment of every
benefit secured by treaty. I doubt the ex
pediency of leading ii. a movement to con
strain China to admit an interpretatioi
which we have only by an indirect treaty the
right to exact. The transference to Chin ;
of American capital for the eniploymen
there of Chinese labor , would in effect in
augurate a competition for the control of
the markets now supplied by our home in
dustries. There is good room to believe
that the law r-striding the immigration
of Chinese has been violated intentionally
or otherwise by the officials of China , upor
whom devolved the duty of certifying that
the immigrants belong to the excepted
classes. Measures have been taken to.'ascer-
tain the facts incident to this supposed in
fraction , and it is believed that the govern
ment of China will co-operate with the
United States in enforcing the faithful ob
servance of the law. The same considera
tions which prompted congress at its last
session to return to Japan the Simonoski
indemnity seems to me to require at its-
hands like action in respect to the Canton
indemnity fund now amounting to three
hundred "thousand dollars. The question
of the general revision of tjw foreign treat
ies of Japan has been considered in An in
ternational conference held at Tokio , but
without delinittt result as yet. This govern
ment is disposed to concede the requests
of Japan to determine its own tariff duties ,
provide such proper judicial tribunals as
may commend themselves to the western
powers for the trial of causes to which for
eigners are parties , and to assimilate the
terms and duration of its tribes to those of
other civilized states.
LIBERIA A.MD HAYTI.
Through our ministers at London and
Moravia , the government has endeavored to
aid Liberia in its differences with Great
Britian , touching the northwestern boun
daries of that republic. There is a prospect
of the adjustment of the dispute by the
adoption of the Monrah river as the line.
This arrangement in a compromise of the
connecting territorial claims , aud taken from
Liberia no countrv over which it has main
tained effective jurisdiction.
COLONIZING CENTRAL AFRICA.
The rioh and populous valley of the Congo
is being opened to commerce by a society
called the International African association ,
of which the king of Belgium is president ,
and a citizen of the United States the chief
executive officer. Large tract5 * of territory
have been ceded to the association by native
chiefs. roads have been opened ,
steamboats placed on tiie river ,
and the nucleus of states estab
lished at twenty-two stations under our
flag , which offers freedom to commerce and
prohibits the slave trade. The objects of
the society are philanthropic. ' It does not
aim to give the management to political con
trol , but seeks the neutrality of the valleys.
The United States can not be indifferent to
this work nor to the interests of their citi
zens involved in it. It may become advis
able for us to co-operate with other com
mercial powers in promoting the rights of
trade and residence In the Congo valley
from the interference or political influence
of any ouo nation. ,
INTERNATIONAL SCIENCE CONGRESS.
In view of the frequency of invitation
from foreign governments to participate in a
social and scientific congress for the discus
sion of important matters .of general con
cern I repeat that suggestion of my lat
message recommending that provision be
made for the exorcise of discretionary
power by the executive in appointing delegates -
gates to such convention. Specialists are
ready to serve the nation in such capacity
without personal profit , or other compensa
tion than the defrayment of expenses actu
ally incurred , and these a comparatively
small annual appropriation would suffice to
meet
RESTRICTION OX AMERICAN COMMERCE.
I have alluded In my previous messages to
the injurious and vexatious restrictions suf
fered bv our trade in the Spanish West In
dies. Brazil , whose natural outlet for its
great coffee product Is in and through the
United States , impo-ies a heavy import duty
on that product. A like narrow policy Is
pursued iu other American countries. Our
petroleumj exports are hampered in Tur
key and other eastern ports by restrictions
as to storage and by onerous taxation , and
the free outward movement of our great
food products Is in pome quitters clogged
with like impediments. Fortbeee mischiefs
udequato relief is not always provided by re
ciprocity treaties like that of Hawaii or that
lately negotiated with Mexico and now
awaiting the action of the senate. Is. it not
advisable to provide some measure of equi
table retaliation in our relations with gov
ernments which discriminate against our
own ? If. for example , the executive were
empowered to apply to Spanish vessels and
cargoes from Cuba and Porto llico , the same
rules of treatment and scale of penalties for
technical faults vvhioh are applied to vessels
and cargoes In the Antll'es , a resort to that
course might not bo barren of good result * .
A discretionary authority to forbid the
importation of articles of consumption inju
rious to health might be advantageously ex
ercised , on our dealing with countries which
discriminate against oiir food products- .
OUH XATIOXAL FINANCES.
The report of the secretary of the treasury
gives R full and interesting" exhibit of the
financial condition of the country. It shows
that the ordinary revenue- from all "ourees
for the ti-cal venr ending June 150 , 1883 ,
amounted to $338,287,581.75 , whereof there
was received :
From customs 5214,70(5,406 M
From internal revenue 144,720,3 < ; 8 98
From sales of public land- " . . . 7,955,804 4.2
From tax on circulation and
deposits of national bank * . . 3,111,008 65
From profits on coinage , bullion - <
lion deposits and assays 4,400,205 17
From customs fees , fines ,
penalties , Ac 1.4,10,23034
From fees consular , letters-
patent , and lands 3,322,001 04
From repayment of Interest
by Pacific" railway coniptin-
* -
. . .
les 1,650,806 90
From sinking fund for Pacific
railway companies 1,322,103 11
From deposits by individuals
for surveying public lands" 1,221,011 76
From proceeds of sales of
government property 285,033 02
From proceeds of pale of
postolilcp property In New
York City 648,69182
From Indian trust-funds 121,000 00
From donations towards
liquidating the public debt. 004,426 87
From Japanese indemnity
fund 1,839,553 99
From immigrant fund 331,4.7650
From revenues of the District
of Columbia 1,970,93847
From miscellaneous sources. 2,413,332 18
Total ordinary receipts.$398,287,681 95
The ordinary exp'enditures for the same
period were :
For civil expenses $ 22,341,285 76
Foreign intercourse 2,419,275 2-t
For Indians 7,362.590 'J4
For pensions- 0(5,012,573 04
For the military establish
ment , including river and
harbor Improvements 48,911,382 9'J
For the naval establishment ,
including vessels , machin
ery , and improvements at
navy yards 15,283,4,17 17
For miscellaneous expendi
tures , including public
buildings , lighthouses , and
collectinpthe revenue 40,098,432 73
For expenditures on account
of the District of Columbia 3,817,023 48
For interest on the public
debt 50,100,131 25
Total ordinary expendi
tures $265,4rB,137 54
Leaving a surplus revenue of . $132,879,444 41
Which , with an amount
drawn from the cash bal
ance in the treasury of 1,209,312 f. ( '
Making $134,17.8,750 90
Was applied to the redemption :
Of bonds for the sinking fund. $14,8.:0,700 00
Of fractional currency for the .
Pinking fund 41,556 91
Of funded loan of 1881 , .con
tinued at3'i per cent 65,380,250 00 I
Of loan ol July and August
18(51 ( , continued at 3 > i per
cent 20,591,600 00
Of funded loan of 1907 1,418,850 00
Of funded loan of 1831 019,150 00
Of loan of February , 1881 18,000 00
Of Joan of July and August ,
1861 2 ; , eoo oo
Of loan of 3Iarch , 1803 117,8iO 00
< _ f loan of July , 1882 47 , 50 00
Of live-twentfes of 18i2 10,300 00
Of live-twenties of 1804 7,0-V ) 00
Of live-twenties of 1 55 II,600 00
Of ten-fortiea 18fl4 138,550 00
Of consols of 1805 40,80000
Of con--olsof 1807 2115,700 00
Of consols of iSliS 154,050 00
Of Oregon war debt 5' , 150
Of refunditv ; certificates' 109,150 00
Of old demand , compound in
terest and other notes 1C , 300 00
Total $131,17 ,756 CO
THE REVENUE.
The revenue for the present fiscal year ,
actual and estimated , is. as follows , for the
the quarter ending September 30 , 1883 , and
for'the three quarters of the year :
For remaining
source Actual three quarters
Sept. IJO , 1833. of year.
Estimated.
From cus
toms 557,402,297.57 $137,597,0.11.3 : }
Internal .290,620,786.40 ! K.337021.40
From sale of
public land 2,932,035.17 567,361.83
From tax on
circulation
on deposit
in national
banks 1,557.800.88 1,942,199.12
From repayment - *
ment afore
said and
sink'gfund
Pacific II II 521,059.51 1,478,940.39
From custom
fees , fines ,
etc 293,069 901,303.22
From fees ,
ciw'lar let
ters , pat
ents and
lands 83,209.80 24,367.90
From pro-
c'ds of gale
of gov'mt.
property. . . 112,503.28 167,437.77
From profits
on coinage ,
etc 950,229.40 8,149,780.54
Prom depos
its for sur-
vy'g lands 17,246.13 327,538.69
From rov'n.
ofDis't. of
Columbia . 25,001.179.90 12,448,820.01
From miscel
laneous 1,237,189.63 2,882,810.37
Total | rcp's $9.566,917.03 247,023,082.97
The actual and estimated expenses for the
> ame period arc :
For remaining
Actual , third of veer ,
Sept. 30 , 1S63. Estimated.
for civil and
miscellaneous.
including all
public build-
in KH , light
houses , and
collodion ? of
revenue . $15k , ' , T99 42 § 3,114,207 68
For Indians - 2,623,390 64 4,126,609 46
for pencions. . . 16,235,201 98 93,714,730 02
b'or military es
tablish in"en t ,
including fort -
i.fi cation . ,
river and har
bor improve
ments and ar
senals . 13,312,204 33 2GJ5,7Ki C7
Per naval estab
lishment , in
cluding ves
sels. and ma
chinery and
impro vemcnts
at navy yard * . 41.5/82,000 92 12,200,700 31
For expendi
tures acc't of
District of Co
lumbia . 1,1C3,83C 41 2,611,16250
Per interest on
the public
debt . 14,707,207 90 39,702,702 04.
Fetal ordiur.rv
expenditures. 77,942,000 33 19,007,009 0-9
rotal receipt ? .
actual and es
timated . 043,000,000 00
ratal expendi
tures , actual
undestmat'd.25a.OOOOCQ ! 00
Total . § 850,000,000 00
Estimated
amount due
the sinking
fund . $ H > V < 57.741 07
Leaving a bal
ance of . fG3,183,25S 93
If the revenue for the fiscal year which
will end on June 30 , 1885 , be estimated
upon the hauls of existing lawn the
is of the opinion that for that secretary the
year
receipt -
ceipt rwill exceed by sixty millions the ordi
nary cxpendifure * . Including' the amount
devoted to thasiKklng'fund.
REDEMPTION OF IJONDfl.
Hitherto the surplus , as rapidly as it has
accumulated , has been directed to the re
duction of the national debt , and as a result
the only bond * now outstanding .vhich are
redeemable at the pleasure of the govern
ment are the 3 per cents amounting to about
$305,000.(06 , the 4 per cents , amount
ing to $250,000,609 , and the $727,000,000 of
4 per cents are not payable until 1891 and
1907 respectively. If the surplus shall
hereafter be as large as the treasury estl- #
mates now indicate , thu 3
per cent , bondx \
may all be redeemed at least four years before -
fore any of the four and one-half per cents
can be called in. The latter , at the same
rate of accumulation of surplus , can be
paid at maturity , aud the moneys requisite
for the redemption of the 1 per cents will
, lie in the treasury many years before those
! ' obligations become payable. There are
'cogent rea ons , however , why the national
indebtedness should not be thus rapidly ex-
tingnishcd. Chief among them is thu fact
that only can excessive taxation make
such rapidity attainable. In a communi
cation to congrunH at its last session
I | recommended that all excise taxes be
abolished except those relating to distilled
spirits , and that suliitantial reductions also
be-made on the revenue from customs. A
statute has since been enacted by which the
annual tax and tariff receipts /the govern
ment have been cut down to the extent of
at least fifty or sixty millions of dollars.
While I have no doubt that still further reductions -
ductions may be wisely made I do not ad
vise the adoption at this session of any
measure of large diminution of the nation
al revenue. The results of the legislation
of the last session of congress haves not as
yet become sufficiently apparent to justify
any radical revision or sweeping modifica
tion of existing laws. In the interval which
must elapbeiore the effects of the act of
March 3 , 1883 , can be definitely ascertained ,
: i portion at least of thft surplus revenue
may be wisely applied to the long neglected
duty of habit'ating our navy and providing
first-class defences for the protection of our
harbors. This is a matter to which I shall
again revert.
TUB NATIONAL CURRENT/ .
Immediately associated with the financed
subject just discussed is the important ques
tion as to what legislation i.s needed regard
ing the nation-il currency. The aggregate
amount of bonds now on deposit in the
treasury to support the national bank circu
lation i's $350,000,000. Nearly $200WO,000
of this amount consists of throe per cents ,
which , as already stated , are payable at the
pleasure of the governinant , and are likely
to be called in within less than four years ,
unle-r. meantime , the .surplus riv"nue >
shall be dimitiNhud. The probable effect
of such an exU-n-ive re.tireiuent of the se
curities , which arc the. basis of the national
bank circulation , would be such ; v contrac
tion of the volume of the currency a * to pro
duce grave commercial cmliarrassmen
How can the danircr be obviated ? The ino"t
effectual plan , and onu whose adoption at
the earlic-t practicable opportunity I shall
heartilv approve , has already been indica
ted.
THE THREATENED CONTRACTION.
If the revenues of the next four years
shall be substantially coimneaMirate"
the expen-e , the volume of circulation will
not be likely to puffer any material disturb
ance , but if"on the other hand there shall
be a great delay in reducing taxation , it will
become necessary either to substitute some * f |
of the other forms of currency in place of
the national bank notes , " or to nvike impor
tant changes in the laws by which their cir
culation is now controlled. In my judg
ment the bttcr coarse is far preferable. I
commend toyourattention the very interest
ing and thoughtful suggestion * on" this sub
ject , which appear in the > -ecret.iry-.s report.
The objections which he urges against the
acceptance of auy other securities than the
obligations of the government itself as a
foundation for national bank circulation ,
seem to me insuperable for averting the
threatened contractions.
METHODS FOR AWARDING CONTRACTS.
Two courses have been "iitrgested , either
of which is probably feasible. One i * the
issuance of new bonds , having many years
to run , bearing a low rate of intere-t , " and
exchangeable upon specified terms fortho-e
now outstanding. 'Hie other course which
commends Itself to my own jadgmeiit as the
better , is the enactment of a law .repealing
the tax on circulation , and permitting thir
banks to issue notes for an amount equal to
ninety pjr cent , of thu market value instead
of as now , the face value of the deposited
bonoh. I agree with the < -eorotarv in the belief
thattheaddoptiouof this plan will afford the
THE TRASK DOLLAR.
The trade dollar was coined for the pur
pose of traffic in countries when ; silver
paspcd at its value ascertained by it * weight
and fineness. It never had a legal tender
quality. Large numbers of ther-e coins en
tered , however , Into the volume of our cur
rency | by common con-sent. Thtlr circula
tion "in domestic trade has now ceased and
they havB become a disturbing element.
They should not longeribe permitted to em-
barra s our currency system. 1 recommend
thatprovisionn be made for their reception
by the treacly and inintn
ai bullion , at a
small percentage above the current market
price of silver of like.
TJIK CUSTOMrf DISTRICTS.
The secretary of the
treasury advise * a
consolidation of certain of tw customs dis
tricts of the country , and Htiggesf that the
president be vested with suli power in re
lation thereto as is now given him in respect
to collectors of internal revenue by section
3141 of the revised statutes. The statistic *
on this subject which are contained in his.
report furnish of themselves a cosrent argu
ment in d pence of his view. . At the ad
journment of congre. . the number of inter
nal revenue collection districtwa 126. By
an executive order ex'-culfl June 25 , l&s. ,
I directed that certain of the di-trirt-
consolidated. The nviilt
hns bo < : n a reoc'I
tion of a third In the number , which leave * < |
at present but 83. 'I
INDIAN TROCHEES.
From the report of the set-rotary of war it
will be seen that in only -ingly ini-ti uo ! . > "IB * < |
there been a disturbance
of the quiet i-ondi- J
tion of our Indiin tribes , a raid "from Mex- I
ice Into Arizona by small psrtv of Indians
which wo * pur-uod by General Crook into
th mountain region- from which i : hod
nonie. It is confidently hoped that serious
outbreak- will not again occur , aud that the
Indian tribes , which have fore many years
disturbed the west , will hereafter remain in
peace.ble submlrrlon.
OCK NATIONAL UKFENCBS.
I again call your attention to the present '
oondltion of our extended sea coavt , upon
which arc * o many lanre citiewhcse wealth
and importance to the country would , In f fl fl
time ol war , invite attsck from modern > v J
armed ' hipig. . fn-t which our exl-ting de-
fenfire works could sive no adequate pro
tection. ' 1 hoeVor * - were built before the
introduction of German heavy rifie frui > inn -
: .
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n 3d pwjc. { ]