Chapter 45

Public transportation is a universal necessity, and the question of just and reasonable charges therefor has become of vital importance not only to shippers and carriers, but also to the vast multitude of producers and consumers. The justice and equity of the principles embodied in the existing law passed for the purpose of regulating these charges are everywhere conceded, and there appears to be no question that the policy thus entered upon has a permanent place in our legislation.

As the present statute when enacted was in the nature of the case more or less tentative and experimental, it was hardly expected to supply a complete and adequate system. While its wholesome effects are manifest and have amply justified its enactment, it is evident that all desired reforms in transportation methods have not been fully accomplished. In view of the judicial interpretation which some provisions of this statute have received and the defects disclosed by the efforts made for its enforcement, its revision and amendment appear to be essential, to the end that it may more effectually reach the evils designed to be corrected. I hope the recommendations of the Commission upon this subject will be promptly and favorably considered by the Congress.

I desire to recur to the statements elsewhere made concerning the Government's receipts and expenditures for the purpose of venturing upon some suggestions touching our present tariff law and its operation.

This statute took effect on the 28th day of August, 1894. Whatever may be its shortcomings as a complete measure of tariff reform, it must be conceded that it has opened the way to a freer and greater exchange of commodities between us and other countries, and thus furnished a wider market for our products and manufactures.

The only entire fiscal year during which this law has been in force ended on the 30th day of June, 1896. In that year our imports increased over those of the previous year more than $6,500,000, while the value of the domestic products we exported and which found markets abroad was nearly $70,000,000 more than during the preceding year.

Those who insist that the cost to our people of articles coming to them from abroad for their needful use should only be increased through tariff charges to an extent necessary to meet the expenses of the Government, as well as those who claim that tariff charges may be laid upon such articles beyond the necessities of Government revenue and with the additional purpose of so increasing their price in our markets as to give American manufacturers and producers better and more profitable opportunities, must agree that our tariff laws are only primarily justified as sources of revenue to enable the Government to meet the necessary expenses of its maintenance. Considered as to its efficiency in this aspect, the present law can by no means fall under just condemnation. During the only complete fiscal year of its operation it has yielded nearly $8,000,000 more revenue than was received from tariff duties in the preceding year. There was, nevertheless, a deficit between our receipts and expenditures of a little more than $25,000,000. This, however, was not unexpected.

The situation was such in December last, seven months before the close of the fiscal year, that the Secretary of the Treasury foretold a deficiency of $17,000,000. The great and increasing apprehension and timidity in business circles and the depression in all activities intervening since that time, resulting from causes perfectly well understood and entirely disconnected with our tariff law or its operation, seriously checked the imports we would have otherwise received and readily account for the difference between this estimate of the Secretary and the actual deficiency, as well as for a continued deficit. Indeed, it must be confessed that we could hardly have had a more unfavorable period than the last two years for the collection of tariff revenue. We can not reasonably hope that our recuperation from this business depression will be sudden, but it has already set in with a promise of acceleration and continuance.

I believe our present tariff law, if allowed a fair opportunity, will in the near future yield a revenue which, with reasonably economical expenditures, will overcome all deficiencies. In the meantime no deficit that has occurred or may occur need excite or disturb us. To meet any such deficit we have in the Treasury in addition to a gold reserve of one hundred millions a surplus of more than $128,000,000 applicable to the payment of the expenses of the Government, and which must, unless expended for that purpose, remain a useless hoard, or, if not extravagantly wasted, must in any event be perverted from the purpose of its exaction from our people. The payment, therefore, of any deficiency in the revenue from this fund is nothing more than its proper and legitimate use. The Government thus applying a surplus fortunately in its Treasury to the payment of expenses not met by its current revenues is not at all to be likened to a man living beyond his income and thus incurring debt or encroaching on his principal.

It is not one of the functions of our Government to accumulate and make additions to a fund not needed for immediate expenditure. With individuals it is the chief object of struggle and effort. The application of an accumulated fund by the Government to the payment of its running expenses is a duty. An individual living beyond his income and embarrassing himself with debt or drawing upon his accumulated fund of principal is either unfortunate or improvident. The distinction is between a government charged with the duty of expending for the benefit of the people and for proper purposes all the money it receives from any source, and the individual, who is expected to manifest a natural desire to avoid debt or to accumulate as much as possible and to live within the income derived from such accumulations, to the end that they may be increased or at least remain unimpaired for the future use and enjoyment of himself or the objects of his love and affection who may survive him.

It is immeasurably better to appropriate our surplus to the payment of justifiable expenses than to allow it to become an invitation to reckless appropriations and extravagant expenditures.

I suppose it will not be denied that under the present law our people obtain the necessaries of a comfortable existence at a cheaper rate than formerly. This is a matter of supreme importance, since it is the palpable duty of every just government to make the burdens of taxation as light as possible. The people should not be required to relinquish this privilege of cheaper living except under the stress of their Government's necessity made plainly manifest.

This reference to the condition and prospects of our revenues naturally suggests an allusion to the weakness and vices of our financial methods. They have been frequently pressed upon the attention of Congress in previous Executive communications and the inevitable danger of their continued toleration pointed out. Without now repeating these details, I can not refrain from again earnestly presenting the necessity of the prompt reform of a system opposed to every rule of sound finance and shown by experience to be fraught with the gravest peril and perplexity. The terrible Civil War, which shook the foundations of our Government more than thirty years ago, brought in its train the destruction of property, the wasting of our country's substance, and the estrangement of brethren. These are now past and forgotten. Even the distressing loss of life the conflict entailed is but a sacred memory which fosters patriotic sentiment and keeps alive a tender regard for those who nobly died. And yet there remains with us to-day in full strength and activity, as an incident of that tremendous struggle, a feature of its financial necessities not only unsuited to our present circumstances, but manifestly a disturbing menace to business security and an ever-present agent of monetary distress.

Because we may be enjoying a temporary relief from its depressing influence, this should not lull us into a false security nor lead us to forget the suddenness of past visitations.

I am more convinced than ever that we can have no assured financial peace and safety until the Government currency obligations upon which gold may be demanded from the Treasury are withdrawn from circulation and canceled. This might be done, as has been heretofore recommended, by their exchange for long-term bonds bearing a low rate of interest or by their redemption with the proceeds of such bonds. Even if only the United States notes known as greenbacks were thus retired it is probable that the Treasury notes issued in payment of silver purchases under the act of July 14, 1890, now paid in gold when demanded, would not create much disturbance, as they might from time to time, when received in the Treasury by redemption in gold or otherwise, be gradually and prudently replaced by silver coin.

This plan of issuing bonds for the purpose of redemption certainly appears to be the most effective and direct path to the needed reform. In default of this, however, it would be a step in the right direction if currency obligations redeemable in gold whenever so redeemed should be canceled instead of being reissued. This operation would be a slow remedy, but it would improve present conditions.

National banks should redeem their own notes. They should be allowed to issue circulation to the par value of bonds deposited as security for its redemption and the tax on their circulation should be reduced to one-fourth of 1 per cent.

In considering projects for the retirement of United States notes and Treasury notes issued under the law of 1890, I am of the opinion that we have placed too much stress upon the danger of contracting the currency and have calculated too little upon the gold that would be added to our circulation if invited to us by better and safer financial methods. It is not so much a contraction of our currency that should be avoided as its unequal distribution.

This might be obviated and any fear of harmful contraction at the same time removed by allowing the organization of smaller banks and in less populous communities than are now permitted, and also authorizing existing banks to establish branches in small communities under proper restrictions.

The entire case may be presented by the statement that the day of sensible and sound financial methods will not dawn upon us until our Government abandons the banking business and the accumulation of funds and confines its monetary operations to the receipt of the money contributed by the people for its support and to the expenditure of such money for the people's benefit.

Our business interests and all good citizens long for rest from feverish agitation and the inauguration by the Government of a reformed financial policy which will encourage enterprise and make certain the rewards of labor and industry.

Another topic in which our people rightfully take a deep interest may be here briefly considered. I refer to the existence of trusts and other huge aggregations of capital the object of which is to secure the monopoly of some particular branch of trade, industry, or commerce and to stifle wholesome competition. When these are defended, it is usually on the ground that though they increase profits they also reduce prices, and thus may benefit the public. It must be remembered, however, that a reduction of prices to the people is not one of the real objects of these organizations, nor is their tendency necessarily in that direction. If it occurs in a particular case it is only because it accords with the purposes or interests of those managing the scheme.

Such occasional results fall far short of compensating the palpable evils charged to the account of trusts and monopolies. Their tendency is to crush out individual independence and to hinder or prevent the free use of human faculties and the full development of human character. Through them the farmer, the artisan, and the small trader is in danger of dislodgment from the proud position of being his own master, watchful of all that touches his country's prosperity, in which he has an individual lot, and interested in all that affects the advantages of business of which he is a factor, to be relegated to the level of a mere appurtenance to a great machine, with little free will, with no duty but that of passive obedience, and with little hope or opportunity of rising in the scale of responsible and helpful citizenship.

To the instinctive belief that such is the inevitable trend of trusts and monopolies is due the widespread and deep-seated popular aversion in which they are held and the not unreasonable insistence that, whatever may be their incidental economic advantages, their general effect upon personal character, prospects, and usefulness can not be otherwise than injurious.

Though Congress has attempted to deal with this matter by legislation, the laws passed for that purpose thus far have proved ineffective, not because of any lack of disposition or attempt to enforce them, but simply because the laws themselves as interpreted by the courts do not reach the difficulty. If the insufficiencies of existing laws can be remedied by further legislation, it should be done. The fact must be recognized, however, that all Federal legislation on this subject may fall short of its purpose because of inherent obstacles and also because of the complex character of our governmental system, which, while making the Federal authority supreme within its sphere, has carefully limited that sphere by metes and bounds that can not be transgressed. The decision of our highest court on this precise question renders it quite doubtful whether the evils of trusts and monopolies can be adequately treated through Federal action unless they seek directly and purposely to include in their objects transportation or intercourse between States or between the United States and foreign countries.

It does not follow, however, that this is the limit of the remedy that may be applied. Even though it may be found that Federal authority is not broad enough to fully reach the case, there can be no doubt of the power of the several States to act effectively in the premises, and there should be no reason to doubt their willingness to judiciously exercise such power.

In concluding this communication its last words shall be an appeal to the Congress for the most rigid economy in the expenditure of the money it holds in trust for the people. The way to perplexing extravagance is easy, but a return to frugality is difficult. When, however, it is considered that those who bear the burdens of taxation have no guaranty of honest care save in the fidelity of their public servants, the duty of all possible retrenchment is plainly manifest.

When our differences are forgotten and our contests of political opinion are no longer remembered, nothing in the retrospect of our public service will be as fortunate and comforting as the recollection of official duty well performed and the memory of a constant devotion to the interests of our confiding fellow-countrymen.

GROVER CLEVELAND.

[Footnote 36: See p. 624.]

[Footnote 37: See pp. 450-451.]

[Footnote 38: Of the second class 52,348,297 was county-free matter.]

[Footnote 39: See pp. 701-711.]

SPECIAL MESSAGES.

EXECUTIVE MANSION, _Washington, January 5, 1897_.

_To the Senate_:

I transmit herewith, in response to a resolution of the Senate of the 22d ultimo, a report from the Secretary of State, accompanied by copies of correspondence concerning the death of Charles Govin, a citizen of the United States, in the island of Cuba.

GROVER CLEVELAND.

EXECUTIVE MANSION, _Washington, January 8, 1897_.

_To the House of Representatives_:

I transmit herewith, in response to the resolution of the House of Representatives of May 8, 1896, requesting information as to what had been done by the Department of State to carry out the provision in the act of March 2, 1895, making appropriations for the Department of Agriculture for the year 1896, as to negotiations with Great Britain to secure the abrogation or modification of the regulations requiring the slaughter of cattle from the United States at the port of entry, a report from the Secretary of State, with accompanying papers.

GROVER CLEVELAND.

EXECUTIVE MANSION, _Washington, January 8, 1897_.

_To the House of Representatives_:

I transmit herewith the report of the Secretary of State in response to the resolution of the House of Representatives of June 5, 1896, calling for information concerning the changes made in the force of his Department since the 4th day of March, 1893.

This report has been in my hands since the 9th day of December, 1896, and its transmission to the House of Representatives has been delayed by my inadvertence.

GROVER CLEVELAND.

EXECUTIVE MANSION, _January 11, 1897_.

_To the Senate_:

I transmit herewith a treaty for the arbitration of all matters in difference between the United States and Great Britain.

The provisions of the treaty are the result of long and patient deliberation and represent concessions made by each party for the sake of agreement upon the general scheme.

Though the result reached may not meet the views of the advocates of immediate, unlimited, and irrevocable arbitration of all international controversies, it is nevertheless confidently believed that the treaty can not fail to be everywhere recognized as making a long step in the right direction and as embodying a practical working plan by which disputes between the two countries will reach a peaceful adjustment as matter of course and in ordinary routine.

In the initiation of such an important movement it must be expected that some of its features will assume a tentative character looking to a further advance, and yet it is apparent that the treaty which has been formulated not only makes war between the parties to it a remote possibility, but precludes those fears and rumors of war which of themselves too often assume the proportions of national disaster.

It is eminently fitting as well as fortunate that the attempts to accomplish results so beneficent should be initiated by kindred peoples, speaking the same tongue and joined together by all the ties of common traditions, common institutions, and common aspirations. The experiment of substituting civilized methods for brute force as the means of settling international questions of right will thus be tried under the happiest auspices. Its success ought not to be doubtful, and the fact that its ultimate ensuing benefits are not likely to be limited to the two countries immediately concerned should cause it to be promoted all the more eagerly. The examples set and the lesson furnished by the successful operation of this treaty are sure to be felt and taken to heart sooner or later by other nations, and will thus mark the beginning of a new epoch in civilization.

Profoundly impressed as I am, therefore, by the promise of transcendent good which this treaty affords, I do not hesitate to accompany its transmission with an expression of my earnest hope that it may commend itself to the favorable consideration of the Senate.

GROVER CLEVELAND.

EXECUTIVE MANSION, _January 18, 1897_.

_To the Senate and House of Representatives_:

I transmit herewith the report of Messrs. James B. Angell, of Michigan, John E. Russell, of Massachusetts, and Lyman E. Cooley, of Illinois, who were appointed commissioners under the authority of a law passed March 2, 1895, to make inquiry and report, after conference with such similar commissioners as might be appointed on behalf of Great Britain or the Dominion of Canada, concerning the feasibility of the construction of such canals as will enable vessels engaged in ocean commerce to pass between the Great Lakes and the Atlantic Ocean, and the most convenient location and probable cost of such canals, together with other facts and information in said act specified relating to their construction and use.

The commissioners have prosecuted the work assigned them with great zeal and intelligence, resulting in the collection of a mass of information embodied in their report and its accompanying exhibits which is of great importance and interest as related to the project subjected to their examination.

The advantages of direct and unbroken water transportation of the products of our Western States and Territories from convenient points of shipment to our seaboard ports are plainly palpable. The report of the commissioners contains, in my opinion, demonstration of the feasibility of securing such transportation, and gives ground for the anticipation that better and more uninterrupted commerce, through the plan suggested, between the great West and foreign ports, with the increase of national prosperity which must follow in its train, will not long escape American enterprise and activity.

It will be observed that the report of the commissioners, though as comprehensive as the time and facilities at their disposal permitted, does not definitely deal with the cost of the work they were called upon to consider and omits some of the other details related to it. Thus far they have labored without compensation, and a part of the small sum appropriated for the payment of their expenses still remains unexpended.

I suggest to the Congress the propriety of making economical provision for such further prosecution of their work as will more fully develop the information necessary to an exact and complete understanding of this interesting and important subject.

GROVER CLEVELAND.

EXECUTIVE MANSION, _Washington, January 22, 1897_.

_To the Senate of the United States_:

In response to the resolution of the Senate of December 15, 1896, relating to Cuban affairs, I transmit a report from the Secretary of State, submitting a list of the claims filed in the Department of State by citizens of the United States against Spain arising out of the insurrection existing in the island of Cuba, and the accompanying correspondence relating to the vessel called the _Competitor_ and the persons claiming American citizenship captured thereon, which I deem it not incompatible with the public interests to communicate.

GROVER CLEVELAND.

EXECUTIVE MANSION, _Washington, January 25, 1897_.

_To the Senate of the United States_:

I transmit herewith, in response to the Senate resolution of December 21, 1896, addressed to the Secretary of State, a report of that officer covering a list of persons claiming to be citizens of the United States who have been arrested on the island of Cuba since February 24, 1895, to the present time.

GROVER CLEVELAND.

EXECUTIVE MANSION, _Washington, February 1, 1897_.

_To the Senate_:

I transmit herewith, in response to a resolution of the Senate of the 6th ultimo, a report from the Secretary of State, accompanied by copies of correspondence concerning the arrest, imprisonment, trial, and condemnation to perpetual imprisonment in chains of Jules Sanguily, a citizen of the United States, by the authorities of Spain in Cuba.

GROVER CLEVELAND.

EXECUTIVE MANSION, _February 5, 1897_.

_To the Senate and House of Representatives_:

The World's Columbian Commission has delivered to me certain documents and exhibits which they desire should constitute the final report required by section 12 of the act of Congress passed April 25, 1890, providing for the celebration of the four hundredth anniversary of the discovery of America and the holding of an international exhibition in the city of Chicago.