 Section 6 of State of the Union Addresses, 1869 through 1876. This is a LibriVox recording. All LibriVox recordings are in the public domain. For more information or to volunteer, please visit LibriVox.org. State of the Union Address, Ulysses S. Grant, December 1, 1873. Part 1. To the Senate and House of Representatives. The year that has passed since the submission of my last message to Congress has, especially during the latter part of it, been an eventful one to the country. In the midst of great national prosperity, a financial crisis has occurred that has brought low fortunes of gigantic proportions. Political partisanship has almost ceased to exist, especially in the agricultural regions, and finally, the capture upon the high seas of a vessel bearing our flag has for a time threatened the most serious consequences, and has agitated the public mind from one end of the country to the other. But this, happily, now is in the course of satisfactory adjustment, honorable to both nations concerned. The relations of the United States, however, with most of the other powers, continue to be friendly and cordial, with France, Germany, Russia, Italy, and the minor European powers. With Brazil and most of the South American republics, and with Japan, nothing has occurred during the year to demand special notice. The correspondence between the Department of State and various diplomatic representatives in or from those countries is transmitted herewith. In executing the will of Congress as expressed in its joint resolution of the 14th of February last, and in accordance with the provisions of the resolution, a number of practical artisans of scientific men and of honorary commissioners were authorized to attend the exposition at Vienna as commissioners on the part of the United States. It is believed that we have obtained the object which Congress had in view when it passed the joint resolution. In order to enable the people of the United States to participate in the advantages of the international exhibition of the products of agriculture, manufacturers, and the fine arts to be held at Vienna. I take pleasure in adding that the American exhibitors have received a gratifying number of diplomas and of medals. During the exposition, a conference was held at Vienna for the purpose of consultation on the systems prevailing in different countries for the protection of inventions. I authorized a representative from the patent office to be present at Vienna at the time when this conference was to take place in order to aid as far as he might in securing any possible additional protection to American inventors in Europe. The report of this agent will be laid before Congress. It is my pleasant duty to announce the Congress that the Emperor of China, on attaining his majority, received the diplomatic representatives of the Western powers in person. An account of these ceremonies and of the interesting discussions which preceded them will be found in the documents transmitted herewith. The accompanying papers show that some advance, although slight, has been made during the past year toward the suppression of the infamous Chinese Cooley trade. I recommend Congress to inquire whether additional legislation be not needed on this subject. The money awarded to the United States by the Tribunal of Arbitration at Geneva was paid by Her Majesty's government a few days in advance of the time when it would have become payable according to the terms of the treaty. In compliance with the provisions of the Act of March 3, 1873, it was at once paid into the Treasury and used to redeem, so far as it might, the public debt of the United States, and the amount so redeemed was invested in a 5% registered bond of the United States for $15,500,000, which is now held by the Secretary of State subject to the future disposition of Congress. I renew my recommendation made at the beginning of the last session of Congress that a commission be created for the purpose of auditing and determining the amounts of several direct losses growing out of the destruction of vessels and their cargoes by the Alabama, the Florida, or the Shenandoah after leaving Melbourne, for which the sufferers have received no equivalent or compensation, and have ascertaining the names of the persons entitled to receive compensation for the same, making the computations upon the basis indicated by the Tribunal of Arbitration at Geneva, and that payment of such losses be authorized to an extent not to exceed the awards of the Tribunal at Geneva. By an act approved on the 14th day of February last, Congress made provision for completing, jointly with an officer or commissioner to be named by her Britannic Majesty, the determination of so much of the boundary line between the territory of the United States and the possessions of Great Britain, as was left uncompleted by the commissioners appointed under the Act of Congress of August 11, 1856. Under the provisions of this Act, the northwest water boundary of the United States has been determined and marked in accordance with the award of the Emperor of Germany. A protocol and copy of the map upon which the line was thus marked are contained in the papers submitted herewith. I also transmit a copy of the report for the commissioner for marking the northern boundary between the United States and the British possessions west of the Lake of the Woods of the operations of the commission during the past season. Surveys have been made to a point 497 miles west of the Lake of the Woods, leaving about 350 miles to be surveyed, the field work of which can be completed during the next season. The mixed commission organized under the provisions of the Treaty of Washington for settling and determining the claims of citizens of either power against the other arising out of acts committed against their persons or property during the period between April 13 1861 and April 9 1865 made its final award on the 25th day of September last. It was awarded that the government of the United States should pay to the government of her Britannic Majesty within 12 months from the date of the award the sum of $1,929,819 in gold. The commission disallowed or dismissed all other claims of British subjects against the United States. The amount of the claims presented by the British government but disallowed or dismissed is understood to be about $93 million. It also disallowed all the claims of citizens of the United States against Great Britain which were referred to it. I recommend the early passage of an act appropriating the amount necessary to pay this award against the United States. I have caused to be communicated to the government of the King of Italy the thanks of this government for the eminent services rendered by Count Courtie as the third commissioner on this commission. With dignity, learning and impartiality he discharged duties requiring great labor and constant patience to the satisfaction I believe of both governments. I recommend legislation to create a special court to consist of three judges who shall be empowered to hear and determine all claims of aliens upon the United States arising out of acts committed against their persons or property during the insurrection. The recent reference under the Treaty of Washington was confined to claims of British subjects arising during the period named in the treaty but it is understood that there are other British claims of a similar nature arising after the 9th of April 1865 and it is known that other claims of a like nature are advanced by citizens or subjects of other powers. It is desirable to have these claims also examined and disposed of. Official information being received from the Dutch government of a state of war between the King of the Netherlands and the Sultan of Akin, the officers of the United States who were near the seat of the war were instructed to observe an impartial neutrality. It is believed that they have done so. The Joint Commission under the Convention with Mexico of 1868 having again been legally prolonged has resumed its business which it is hoped may be brought to an early conclusion. The distinguished representative of her Britannic Majesty at Washington has kindly consented with the approval of his government to assume the arduous and responsible duties of umpire in this commission and to lend the weight of his character and name to such decisions as may not receive the acquiescence of both the arbitrators appointed by the respective governments. The commissioners appointed pursuant to the authority of Congress to examine into the nature and extent of the forays by trespassers from that country upon the herds of Texas have made a report which will be submitted for your consideration. The Venezuelan government has been apprised of the sense of Congress in regard to the awards of the Joint Commission under the Convention of 25th April 1866 as expressed in the act of the 25th of February last. It is apprehended that the government does not realize the character of its obligations under that convention. As there is reason to believe however that its hesitancy in recognizing them springs in part at least from real difficulty in discharging them in connection with its obligations to other governments. The expediency of further forbearance on our part is believed to be worthy of your consideration. The Ottoman government and that of Egypt have laterally shown a disposition to relieve foreign consuls of the judicial powers which heretofore they have exercised in the Turkish Dominions by organizing other tribunals. As Congress however has by law provided for the discharge of judicial functions by consuls of the United States in that quarter under the Treaty of 1830, I have not felt at liberty formally to accept the proposed change without the assent of Congress whose decision upon the subject at as early a period as may be convenient is earnestly requested. I transmit herewith for the consideration and determination of Congress and application of the Republic of Santo Domingo to this government to exercise a protectorate over that Republic. Since the adjournment of Congress, the following treaties with foreign powers have been proclaimed. A naturalization convention with Denmark, a convention with Mexico for renewing the Claims Commission, a convention of friendship, commerce and extradition with the Orange Free State, and a naturalization convention with Ecuador. I renew the recommendation made in my message of December 1870 that Congress authorized the Postmaster General to issue all commissions to officials appointed through his department. I invite the earnest attention of Congress to the existing laws of the United States respecting expatriation and the election of nationality by individuals. Many citizens of the United States reside permanently abroad with their families. Under the provision of the Act Approved, February 10, 1855, the children of such persons are deemed to be and taken to be citizens of the United States, but the rights of citizenship are not to descend to persons whose fathers never resided in the United States. It thus happens that persons who have never resided within the United States have been enabled to put forward a pretension to the protection of the United States against the claim to military service of the government under whose protection they were born and have been reared. In some cases, even naturalized citizens of the United States have returned to the land of their birth with intent to remain there, and their children, the issue of a marriage contracted there after their return, and who have never been in the United States, have laid claim to our protection when the lapse of many years had imposed upon them the duty of military service to the only government which had ever known them personally. Until the year 1868, it was left, embarrassed by conflicting opinions of courts and of jurists, to determine how far the doctrine of perpetual allegiance derived from our former colonial relations with Great Britain was applicable to American citizens. Congress then wisely swept these doubts away by enacting that any declaration, instruction, opinion, order, or decision of any officer of this government which denies, restricts, impairs, or questions the right of expatriation is inconsistent with the fundamental principles of this government. But Congress did not indicate in that statute, nor has it since done so, what acts are to be deemed to work expatriation. For my own guidance in determining such questions I required, led with the provisions of the Constitution, the opinion in writing of the principal officer in each of the executive departments upon certain questions relating to this subject. The result satisfies me that further legislation has become necessary. I therefore commend the subject to the careful consideration of Congress, and I transmit herewith copies of the several opinions of the principal officers of the executive departments together with other correspondents and pertinent information on the same subject. The United States, who led the way in the overthrow of the feudal doctrine of perpetual allegiance, are among the last to indicate how their own citizens may elect another nationality. The paper submitted herewith indicate what is necessary to place us on a par with other leading nations in liberality of legislation on this international question. We have already in our treaties assented to the principles which would need to be embodied in laws intended to accomplish such results. We have agreed that citizens of the United States may cease to be citizens and may voluntarily render allegiance to other powers. We have agreed that residents in a foreign land without intent to return shall of itself work expatriation. We have agreed in some instances upon the length of time necessary for such continued residents to work a presumption of such intent. I invite Congress now to mark out and define when and how expatriation can be accomplished, to regulate by law the condition of American women marrying foreigners, to fix the status of children born in a foreign country of American parents residing more or less permanently abroad, and to make rules for determining such other kindred points as may seem best to Congress. In compliance with the requests of Congress, I transmitted to the American minister at Madrid with instructions to present it to the Spanish government. The joint resolution approved on the 3rd of March last, tendering to the people of Spain in the name and on behalf of the American people, the congratulations of Congress upon the efforts to consolidate in Spain the principles of universal liberty in a Republican form of government. The existence of this new republic was inaugurated by striking the fetters from the slaves in Puerto Rico. This beneficent measure was followed by the release of several thousand persons illegally held as slaves in Cuba. Next, the captain general of that colony was deprived of the power to set beside the orders of his superiors at Madrid, which had pertained to the office since 1825. The sequestered estates of American citizens, which had been the cause of long and fruitless correspondence, were ordered to be restored to their owners. All these liberal steps were taken in the face of a violent opposition directed by the reactionary slaveholders of Havana, who are vainly striving to stay the march of ideas which has terminated slavery and Christendom, Cuba only accepted. Unhappily, however, this baneful influence has thus far succeeded in defeating the efforts of all liberal-minded men in Spain to abolish slavery in Cuba and in preventing the promised reform in that island. The struggle for political supremacy continues there. The pro-slavery and aristocratic party in Cuba is gradually arraigning itself in more and more open hostility and defiance of the home government, while it still maintains a political connection with the republic in the peninsula. And although usurping and defying the authority of the home government whenever such usurpation or defiance tends in the direction of oppression or of the maintenance of abuses, it is still a power in Madrid and is recognized by the government. Thus an element more dangerous to continue colonial relations between Cuba and Spain than that which inspired the insurrection at Yara, an element opposed to granting any relief from misrule and abuse, with no aspirations after freedom, commanding no sympathies and generous arrests, aiming to rivet still stronger the shackles of slavery and oppression, has seized many of the emblems of power in Cuba and under professions of loyalty to the mother country, is exhausting the resources of the island, and is doing acts which are at variance with those principles of justice, of liberality, and of right which give nobility of character to a republic. In the interests of humanity, of civilization, and of progress, it is to be hoped that this evil influence may soon be averted. The steamer, Virginius, was on the 26th day of September 1870, duly registered at the port of New York as a part of the commercial marine of the United States. On the 4th of October 1870, having received the certificate of her register in the usual legal form, she sailed from the port of New York and has not since been within the territorial jurisdiction of the United States. On the 31st day of October last, while sailing under the flag of the United States on the high seas, she was forcibly seized by the Spanish gunboat tornado and was carried into the port of Santiago de Cuba, where 53 of her passengers and crew were inhumanely and so far as at least relates to those who were citizens of the United States without due process of law put to death. It is a well-established principle asserted by the United States from the beginning of their national independence, recognized by Great Britain and other maritime powers and stated by the Senate in a resolution passed unanimously on the 16th of June 1858 that American vessels on the high seas in time of peace bearing the American flag remain under the jurisdiction of the country to which they belong and therefore any visitation, molestation or detention of such vessel by force or by the exhibition of force on the part of a foreign power is in derogation of the sovereignty of the United States. In accordance with this principle, the restoration of the Virginias and the surrender of the survivors of her passengers and crew and a due reparation to the flag and the punishment of the authorities who had been guilty of the illegal acts of violence were demanded. The Spanish government has recognized the justice of the demand and has arranged for the immediate delivery of the vessel and for the surrender of the survivors of the passengers and crew and for a salute to the flag and for proceedings looking to the punishment for those who may have proved to have been guilty of illegal acts of violence toward citizens of the United States and also toward identifying those who may be shown to be entitled to indemnity. A copy of a protocol of a conference between the Secretary of State and the Spanish minister in which the terms of this agreement were agreed to is transmitted herewith. The correspondence on this subject with the legation of the United States in Madrid was conducted in Safer and by Cable and needs the verification of the actual text of the correspondence. It has seemed to me to be due to the importance of the case not to submit this correspondence until the accurate text can be received by mail. It is expected shortly and will be submitted when received. In taking leave of this subject for the present I wish to renew the expression of my conviction that the existence of African slavery in Cuba is a principal cause of the lamentable condition of the island. I do not doubt that Congress shares with me the hope that it will soon be made to disappear and that peace and prosperity may follow its abolition. The embargoing of American estates in Cuba, cruelty to American citizens detected in no act of hostility to the Spanish government, the murdering of prisoners taken with arms in their hands and finally the capture upon the high seas of a vessel sailing under the United States flag and bearing a United States registry have culminated in an outburst of indignation that has seemed for a time to threaten war. Pending negotiations between the United States and the government of Spain on the subject of this capture, I have authorized the Secretary of the Navy to put our Navy on a war footing to the extent at least of the entire annual appropriation for that branch of the service trusting to Congress and the public opinion of the American people to justify my action. Assuming from the action of the last Congress in appointing a committee on privileges and elections to prepare and report to this Congress a constitutional amendment to provide a better method of electing the President and Vice President of the United States and also from the necessity of such an amendment that there will be submitted to the state legislatures for ratification such an improvement in our Constitution, I suggest two others for your consideration. First, to authorize the executive to approve of so much of any measure passing the two Houses of Congress as his judgment may dictate without approving the whole, the disproved portion or portions to be subjected to the same rules as now to wit to be referred back to the House in which the measure or measure is originated and if passed by a two-thirds vote of the two Houses then to become a law without the approval of the President. I would add to this a provision that there should be no legislation by Congress during the last 24 hours of its sitting except upon vetoes in order to give the executive an opportunity to examine and approve or disapprove bills understandingly. Second, to provide by amendment that when an extra session of Congress is convened by executive proclamation legislation during the continuance of such extra session shall be confined to such subjects as the executive may bring before it from time to time in writing. The advantages to be gained by these two amendments are too obvious for me to comment upon them. One session in each year is provided for by the Constitution in which there are no restrictions as to the subjects of legislation by Congress. If more are required it is always in the power of Congress during their term of office to provide for sessions at any time. The first of these amendments would protect the public against the many abuses and waste of public monies which creep into appropriation bills and other important measures passed during the expiring hours of Congress to which otherwise due consideration cannot be given. Treasury Department, the receipts of the government from all sources for the last fiscal year were $333,738,204 and expenditures on all accounts $290,345,245 thus showing an excess of receipts over expenditures of $43,392,959. But it is not probable that this favorable exhibit will be shown for the present fiscal year. Indeed it is very doubtful whether, except with great economy on the part of Congress in making appropriations and the same economy in administering the various departments of government, the revenues will not fall short of meeting actual expenses including interest on the public debt. I commend to Congress such economy and point out two sources where it seems to me it might commence to wit in the appropriations for public buildings in the many cities where work has not yet been commenced in the appropriations for river and harbor improvements in those localities where the improvements are of but little benefit to general Congress and for fortifications. There is a still more fruitful source of expenditure which I will point out later in this message. I refer to the easy method of manufacturing claims for losses incurred in suppressing the late rebellion. I would not be understood here as opposing the erection of good, substantial, and even ornamental buildings by the government wherever such buildings are needed. In fact, I approve of the government owning its own buildings in all sections of the country and hope the day is not far distant when it will not only possess them, but will erect in the capital suitable residences for all persons who now receive commutation for quarters or rent at government expense and for the cabinet thus setting an example to the states which may induce them to erect buildings for their senators. But I would have this work conducted at any time when the revenues of the country would abundantly justify it. The revenues have materially fallen off for the first five months of the present fiscal year from what they were expected to produce owing to the general panic now prevailing which commenced about the middle of September last. The full effect of this disaster, if it should not prove a blessing in disguise, is yet to be demonstrated. In either event, it is your duty to heed this lesson and to provide by wise and well considered legislation as far as it lies in your power against its recurrence and to take advantage of all benefits that may have accrued. My own judgment is that, however much individuals may have suffered, one long step has been taken towards specie payments that we can never have permanent prosperity until a specie basis is reached and that a specie basis cannot be reached and maintained until our exports, exclusive of gold, pay for our imports, interest due abroad and other specie obligations or so nearly so as to leave an appreciable accumulation of the precious metals in the country from the products of our mines. The development of the mines of precious metals during the past year and the prospective development of them for years to come are gratifying in their results. Could but one half of the gold extracted from the mines be retained at home our advance towards specie payments would be rapid. To increase our exports, sufficient currency is required to keep all the industries of the country employed. Without this, national as well as individual bankruptcy must ensue. Undo inflation on the other hand, while it might give temporary relief, would only lead to inflation of prices, the impossibility of competing in our own markets for the products of homeskill and labor and repeated renewals of present experiences. Elasticity of our circulating medium therefore and just enough of it to transact the legitimate business of the country and to keep all industries employed is what is most to be desired. The exact medium is specie, the recognized medium of exchange the world over. That obtained, we shall have a currency of an exact degree of elasticity. If there be too much of it for the legitimate purposes of trade and commerce, it will flow out of the country. If too little, the reverse will result. To hold what we have and to appreciate our currency to that standard is the problem deserving of the most serious consideration of Congress. The experience of the present panic has proven that the currency of the country based as it is upon the credit of the country is the best that has ever been devised. Usually in times of such trials, currency has become worthless or so much depreciated in value as to inflate the values of all the necessaries of life as compared with the currency. Everyone holding it has been anxious to dispose of it on any terms. Now we witness the reverse. Holders of currency hoard it as they did gold in former experiences of like nature. It is patent to the most casual observer that much more currency or money is required to transact the legitimate trade of the country during the fall and winter months when the vast crops are being removed then during the balance of the year. With our present system, the amount in the country remains the same throughout the entire year resulting in an accumulation of all the surplus capital of the country in a few centers when not employed in the moving of crops tempted there by the offer of interest on call loans. Interest being paid, thus surplus capital must earn this interest paid with a profit. Being subject to call, it cannot be loaned only in part at best to the merchant or manufacturer for a fixed term. Hence, no matter how much currency there might be in the country, it would be absorbed prices keeping pace with the volume and panics, strigency and disasters would ever be recurring with the autumn. Elasticity in our monetary system therefore is the object to be attained first and next to that, as far as possible, a prevention of the use of other people's money in stock or other species of speculation. To prevent the latter, it seems to me that one great step would be taken by prohibiting the national banks from paying interest on deposits by requiring them to hold their reserves in their own vaults and by forcing them into resumption, though it would only be in legal tender notes. For this purpose, I would suggest the establishment of clearing houses for consideration. To secure the former, many plans have been suggested, most if not all of which look to me more like inflation on the one hand or compelling the government on the other to pay interest without corresponding benefits upon the surplus funds of the country during the seasons when otherwise unemployed. I submit for your consideration whether this difficulty might not be overcome by authorizing the Secretary of the Treasury to issue at any time to national banks of issue any amount of their own notes below a fixed percentage of their issue, say 40%, upon the banks depositing with the Treasurer of the United States an amount of government bonds equal to the amount of notes demanded. The banks to forfeit to the government say 4% of the interest accruing on the bonds so pledged during the time they remain with the Treasurer as security for the increased circulation, the bonds so pledged to be redeemable by the banks at their pleasure either in whole or in part by returning their own bills for cancellation to an amount equal to the face of the bonds withdrawn. I would further suggest for your consideration the propriety of authorizing national banks to diminish their standing issue at pleasure by returning for cancellation their own bills and withdrawing so many United States bonds as are pledged for the bills returned. In view of the great actual contraction that has taken place in the currency and the comparative contraction continuously going on due to the increase of population, increase of manufacturers and all the industries, I do not believe there is too much of it now for the dullest period of the year. Indeed if clearing houses should be established, thus forcing redemption it is a question for your consideration whether banking should not be made free retaining all the safeguards now required to secure bill holders. In any modification of the present laws regulating national banks as a further step toward preparing for resumption of species payments I invite your attention to a consideration of the propriety of exacting from them the retention as part of their reserve either the whole or a part of the gold interest accruing upon the bonds pledged as a security for their issue. I have not reflected enough on the bearing this might have in producing a scarcity of coin with which to pay duties on imports to give it my positive recommendation but your attention is invited to the subject. During the last four years the currency has been contracted directly by the withdrawal of 3% certificates compound interest notes and 730 bonds outstanding on the 4th of March 1869 all of which took the place of legal tenders in the bank reserves to the extent of $63 million. During the same period there has been a much larger comparative contraction of the currency. The population of the country has largely increased more than 25,000 miles of railroad have been built requiring the active use of capital to operate them. Millions of acres of land have been opened to cultivation requiring capital to move the products. Manufacturers have multiplied beyond all precedent in the same period of time requiring capital weekly for the payment of wages and for the purchase of material and probably the largest of all comparative contraction arises from the organizing of free labor in the south. Now every laborer there receives his wages and for want of savings banks the greater part of such wages is carried in the pocket or hoarded until required for use. These suggestions are thrown out for your consideration without any recommendation that they shall be adopted literally but hoping that the best method may be arrived at to secure such an elasticity of the currency as will keep employed all the industries of the country and prevent such an inflation as will put off indefinitely the resumption of species payments an object so devoutly to be wished for by all and by none more earnestly than the class of people most directly interested those who earn their bread by the sweat of their brow. The decisions of Congress on this subject will have the hearty support of the executive. In previous messages I have called attention to the decline in American shipbuilding and recommend such legislation as would secure to us our proportion of the carrying trade. Stimulated by high rates and abundance of freight the progress for the last year in shipbuilding has been very satisfactory. There has been an increase of about 3% in the amount transported in American vessels over the amount of time. With the reduced cost of material which has taken place it may reasonably be hoped that this progress will be maintained and even increased. However as we pay about $80 million per annum to foreign vessels for the transportation to a market of our surplus products thus increasing the balance of trade against us to this amount the subject is one worthy of your serious consideration. Cheap transportation is a subject that has attracted the attention of both producers and consumers for the past few years and has contributed to if it has not been the direct cause of the recent panic and stringency. As Congress at its last session appointed a special committee to investigate this whole subject during the vacation and report at this session I have nothing to recommend until their report is read. There is one work however of a national character in which the greater portion of the east and the west the north and the south are equally interested to which I will invite your attention. The state of New York has a canal connecting Lake Erie with tide water on the Hudson River. The state of Illinois has a similar work connecting Lake Michigan with navigable water on the Illinois River thus making water communication inland between the east and the west and south. These great artificial water courses are the property of the states through which they pass and pay toll to those states. Would it not be wise statesmanship to pledge these states that if they will open these canals for the passage of large vessels the general government will look after and keep in navigable condition the great public highways with which they connect to wit the overslaw on the Hudson, the St. Clair Flats and the Illinois and Mississippi Rivers. This would be a national work one of great value to the producers of the west and south in giving them cheap transportation for their produce to the seaboard and a market and to the consumers in the east in giving them cheaper food particularly of those articles of food which do not find a foreign market and the prices of which therefore are not regulated by foreign demands. The advantages of such a work are too obvious for argument I submit the subject to you therefore without further comment. In attempting to regain our lost commerce and carrying trade we have here too forecalled attention to the states south of us offering a field where much might be accomplished. To further this object I suggest that a small appropriation be made accompanied with authority for the secretary of the Navy to fit out a naval vessel to ascend the Amazon River to the mouth of the Madeira. Then to explore that river and its tributaries into Bolivia and to report to Congress at its next session or as soon as practicable the accessibility of water its resources and the population so reached. Such an exploration would cost what little it can do no harm and may result in establishing a trade of value to both nations. In further connection with the Treasury Department I would recommend a revision and codification of the tariff laws and the opening of more mince for coining money with authority to coin for such nations as may apply. End of section 6. Recording by E. Winters Section 7 of State of the Union Addresses 1869-1876. This is a LibriVox recording. All LibriVox recordings are in the public domain. For more information or to volunteer please visit LibriVox.org Section 7 Ulysses S. Grant December 1st 1873 Part 2 War Department. The attention of Congress is invited to the recommendations contained in the report of the Secretary of War here with accompanying. The apparent great cost of supporting the army is fully explained by this report and I hope it will receive your attention. While inviting your general attention to all the recommendations made by the Secretary of War there are two which I would especially invite you to consider. First the importance of preparing for war in time of peace by providing proper armament for our seacoast defenses. Proper armament is a vastly more importance than fortifications. The latter can be supplied very speedily for temporary purposes when needed the former cannot. The second is the necessity of reopening promotion in the staff corps of the army particularly is this necessity felt in the medical pay and ordinance departments. At this time it is necessary to employ contract surgeons to supply the necessary medical attendance required by the army. With the present force of the pay department it is now difficult to make the payments to troops provided for by law. Long delays in payments are productive of desertions and other demoralization and the law prohibits the payment of troops by other than regular army paymasters. There are now 16 vacancies in the ordinance department thus leaving that branch of the service without sufficient officers to conduct the business of the different arsenals on a large scale if ever required. Navy department during the past year our Navy has been depleted by the sale of some vessels no longer fit for naval service and by the condemnation of others not yet disposed of. This however has been more than compensated for by the repair of six of the old wooden ships and by the building of eight new sloops of war authorized by the last Congress. The building of these latter has occurred at a doubly fortunate time. They are about being completed at a time when they may possibly be much needed and the work upon them has not only given direct employment to thousands of men but has no doubt been the means of keeping open establishments for other work at a time of great financial distress. Since the commencement of last month however the distressing occurrences which have taken place in the waters of the Caribbean Sea almost on our very seaboard while they illustrate most forcibly the necessity always existing that a nation situated like ours should maintain in a state of possible efficiency a Navy adequate to its responsibilities has at the same time demanded that all the effective force we really have shall be put in immediate readiness for war like service. This has been and is being done promptly and effectively and I am assured that all the available ships and every authorized man of the American Navy will be ready for whatever action is required for the safety of our citizens or the maintenance of our honor. This of course will require the expenditure in a short time of some of the appropriations which were calculated to extend through the fiscal year but Congress will I doubt not understand and appreciate the emergency and will provide adequately not only for the present preparation but for the future maintenance of our naval force. The Secretary of the Navy has during the past year been quietly putting some of our most effective monitors in condition for service and thus the exigency was in a much better condition for work than we could possibly have been without his action. Post Office Department A complete exhibit is presented in the accompanying report of the Postmaster General of the operations of the Post Office Department during the year. The ordinary postal revenues for the fiscal year ended June 30 1873 amounted to 22 996 741 cents and the expenditures of all kinds to 29 84945 and 67 cents the increase of revenues over 1872 was 1,081,315 dollars and 20 cents and the increase of expenditures 2,426,753 dollars and 36 cents. Independent of the payments made from special appropriations for ship lines, the amount drawn from the general treasury to meet deficiencies was 5,265,475 dollars. The constant and rapid extension of our postal service particularly upon railways and the improved facilities for the collection transmission distribution and delivery of the mails which are constantly being provided account for the increased expenditures of this popular branch of the public service. The total number of post offices in operation on June 30 1873 was 33,244 and that increase of 1,381 over the number reported the preceding year. The number of presidential offices was 1,363 an increase of 163 during the year. The total length of railroad mail routes at the close of the year was 63,457 miles and increase of 5,546 miles over the year 1872. 59 railway post office lines were in operation June 30 1873 extending over 14,866 miles of railroad routes and performing an aggregate service of 34,925 miles daily. The number of letters exchanged with foreign countries was 27,459,185 an increase of 1,096,685 over the previous year and the postage thereon amounted to 2,021,310 dollars and 86 cents. The total weight of correspondence exchanged in the mails with European countries exceeded 912 tons an increase of 92 tons over the previous year. The total cost of the United States Ocean Steamship Service including $725,000 paid from special appropriations to subsidized lines of mail steamers was 1,047,271 dollars and 35 cents. New or additional postal conventions have been concluded with Sweden, Norway, Belgium, Germany, Canada, Newfoundland and Japan reducing postage rates on correspondence exchanged with those countries and further efforts have been made to conclude a satisfactory postal convention with France but without success. I invite the favorable consideration of Congress to the suggestions and recommendations of the Postmaster General for an extension of the free delivery system in all cities having a population of not less than 10,000 for the prepayment of postage on newspapers and other printed matter of the second class for a uniform postage and limit of weight on miscellaneous matter for adjusting the compensation of all postmasters not appointed by the president by the old method of commissions on the actual receipts of the office instead of the present mode of fixing the salary in advance upon special returns and especially do I urge favorable action by Congress on the important recommendations of the Postmaster General for the establishment of United States Postal Savings Depositories. Your attention is also again called to a consideration of the question of postal telegraphs and the arguments induced in support thereof in the hope that you may take such action in connection therewith as in your judgment will most contribute to the best interests of the country. Department of Justice Affairs in Utah require your early and special attention. The Supreme Court of the United States in the case of Clinton versus Engelbrecht decided that the United States Marshal of that territory could not lawfully summon jurors for the district courts and those courts hold that the territorial Marshal cannot lawfully perform that duty because it is elected by the legislative assembly and not appointed as provided for in the act organizing the territory. All proceedings at law are practically abolished by these decisions and there have been but few or no jury trials in the district courts of that territory since the last session of Congress. Property is left without protection by the courts and crimes go unpunished. To prevent anarchy there it is absolutely necessary that Congress provide the courts with some mode of obtaining jurors and I recommend legislation to that end and also that the probate courts of the territory now assuming to issue rits of injunction and abyss corpus and to try criminal cases and questions as to land titles be denied all jurisdiction not possessed ordinarily by courts of that description. I have become impressed with the belief that the act approved March 2 1867 entitled an act to establish a uniform system of bankruptcy throughout the United States is productive of more evil than good at this time. Many considerations might be urged for its total repeal but if this is not considered advisable I think it will not be seriously questioned that those portions of said act providing for what is called involuntary bankruptcy operate to increase the financial embarrassments of the country. Careful and prudent men very often become involved in debt in the transaction of their business and though they may possess ample property if it could be made available for that purpose to meet all their liabilities yet on account of the extraordinary scarcity of money they may be unable to meet all their pecuniary obligations as they become due in consequence of which they are liable to be prostrated in their business by proceedings in bankruptcy at the instance of unrelenting creditors. People are now so easily alarmed as to monetary matters that the mere filing of a petition bankruptcy by an unfriendly creditor will necessarily embarrass and often times accomplish the financial ruin of a responsible businessman. Those who otherwise might make lawful and just arrangements to relieve themselves from difficulties produced by the present stringency and money are prevented by their constant exposure to attack and disappointment by proceedings against them in bankruptcy and besides the law is made use of in many cases by obdurate creditors to frighten or force debtors into a compliance with their wishes and into acts of injustice to other creditors and to themselves. I recommend that so much of said act as provides for involuntary bankruptcy on account of the suspension of payment be repealed. Your careful attention is invited to the subject of claims against the government and to the facilities afforded by existing laws for their prosecution. Each of the departments of state treasury and war has demands for many millions of dollars upon its files and they are rapidly accumulating. To these may be added those now pending before Congress, the Court of Claims and the Southern Claims Commission making in the aggregate an immense sum. Most of these grow out of the rebellion and are intended to indemnify persons on both sides for their losses during the war and not a few of them are fabricated and supported by false testimony. Projects are on foot it is believed to induce Congress to provide for new classes of claims and to revive old ones through the repeal or modification of the statute of limitations by which they are now barred. I presume these schemes if proposed will be received with little favor by Congress and I recommend that persons having claims against the United States cognizable by any tribunal or department thereof be required to present them at an early day and that legislation be directed as far as practicable to the defeat of unfounded and unjust demands upon the government and I would suggest as a means of preventing fraud that witnesses be called upon to appear in person to testify before those tribunals having said claims before them for adjudication. Probably the largest saving to the national treasury can be secured by timely legislation on the subjects of any of the economic measures that will be proposed. You will be advised of the operations of the Department of Justice by the report of the Attorney General and I invite your attention to the amendments of existing laws suggested by him with the view of reducing the expenses of that department. Department of the Interior. The policy inaugurated towards the Indians at the beginning of the last administration has been steadily pursued and I believe with beneficial results. It will be continued with only such modification as time and experience may demonstrate as necessary. With the encroachment of civilization upon the Indian reservations and hunting grounds disturbances have taken place between the Indians and whites during the past year and probably will continue to do so until each race appreciates that the other has rights which must be respected. The policy has been to collect the Indians as rapidly as possible in reservations and as far as practicable within what is known as the Indian territory and to teach them the arts of civilization and self-support. We're found off their reservations and endangering the peace and safety of the whites they have been punished and will continue to be for like offenses. The Indian territory south of Kansas and west of Arkansas is sufficient in area and agricultural resources to support all the Indians east of the Rocky Mountains. In time no doubt all of them except a few who may elect to make their homes among white people will be collected there. As a preparatory step for this we are all satisfied that a territorial form of government should be given them which will secure the treaty rights of the original settlers and protect their homesteads from alienation for a period of 20 years. The operations of the patent office are growing to such a magnitude and the accumulation of material is becoming so great that the necessity of more room is becoming more obvious day by day. I respectfully invite your attention to the reports of the Secretary of the Interior and the governor of patents on this subject. The business of the general land office exhibits a material increase in all its branches during the last fiscal year. During that time there were disposed of out of the public lands 13,030,606 acres being an amount greater by 1,165,631 acres than was disposed of during the preceding year. Of the amount disposed of 626,266 acres were sold for cash 214,940 acres were located with military land warrants 3,793,612 acres were taken for homesteads 653,446 acres were located with agricultural college script 6,083,536 acres were certified by railroads 6,056 acres were granted to wagon roads 238,548 acres were approved to states as swamp lands 138,681 acres were certified for agricultural colleges, common schools, universities and seminaries 190,775 acres were approved to states for internal improvements and 14,222 acres were located with Indian script The cash receipts during the same time were 3,408,515 dollars and 50 cents being 190,415 dollars and 50 cents in excess of the receipts of the previous year. During the year 30,488,132 acres of public land were surveyed and increase over the amount surveyed the previous year of 1,037,193 acres and added to the area previously surveyed aggregate 616,554,895 acres which have been surveyed leaving 1,218,443,505 acres of the public land still unsurveyed. The increased and steadily increasing facilities for reaching our unoccupied public domain and for the transportation of surplus products enlarged the available field for desirable homestead locations the stimulating settlement and extending year by year in a gradually increasing ratio the area of occupation and cultivation The expressed desire of the representatives of a large colony of citizens of Russia to emigrate to this country as is understood with the consent of their government if certain concessions can be made to enable them to settle in a compact colony is of great interest as going to show the light in which our institutions are regarded by an industrious, intelligent and wealthy people desirous of enjoying civil and religious liberty and the acquisition of so large an immigration of citizens of a superior class would without doubt be of substantial benefit to the country I invite attention to the suggestion of the secretary of the interior in this behalf. There was paid during the last fiscal year for pensions including the expense of disbursement $29,185,289.62 being an amount less by $984,050.98 than was expended for the same purpose the preceding year. Although the statement of expenditures would indicate a material reduction in amount compared with the preceding year it is believed that the changes in the pension laws at the last session of Congress will absorb that amount the current year. At the close of the last fiscal year there were on the pension rolls of four invalid military pensioners and 1288 widows, orphans and dependent relatives of deceased soldiers making a total of that class of 211,892 18,266 survivors of the war of 1812 and 5,058 widows of soldiers of that war pensioned under the act of Congress of February 14,1871 making a total of that class of 23,319 1,480 invalid Navy pensioners and 1,770 widows, orphans and dependent relatives of deceased officers sailors and Marines of the Navy making a total of Navy pensioners of 3,200 and a grand total of pensioners of 311 classes of 238,411 showing a net increase during the last fiscal year of 6,182 during the last year the names of 16,405 pensioners were added to the rolls and 10,223 names were dropped there from for various causes. The system adopted for the detection of frauds against the government in the matter of pensions has been productive of satisfactory results but legislation is needed to provide if possible against the perpetration of such frauds in future. The evidently increasing interest in the cause of education is a most encouraging feature in the general progress and prosperity of the country and the Bureau of Education is earnest in its efforts to give proper direction to the new appliances and increased facilities which are being offered to aid the educators of the country in their great work. The ninth census has been completed the report there of published and distributed and the working force of the Bureau disbanded the Secretary of the Interior renews his recommendation for a census to be taken in 1875 to which subject the attention of Congress is invited. The original suggestion in that behalf has met with the general approval of the country and even if it be not deemed advisable at present to provide for a regular quinquennial census a census taken in 1875 the report of which could be completed and published before the 100th anniversary of our national independence would be especially interesting and valuable as showing the progress of the country during the first century of our national existence. It is believed however that a regular census every five years would be of substantial benefit to the country in as much as our growth hitherto has been so rapid that the results of the decennial census are necessarily unreliable as a basis of estimates for the latter years of a decennial period. District of Columbia under the very efficient management of the governor and the Board of Public Works of this district the city of Washington is rapidly assuming the appearance of a capital of which the nation may well be proud from being a most unsightly place three years ago disagreeable to pass through in summer in consequence of the dust arising from unpaved streets and almost impassable in the winter from the mud it is now one of the most sightly cities in the country and can boast of being the best paved the work has been done systematically the plans grades location of sewers water and gas mains being determined upon before the work was commenced thus securing permanency when completed I question whether so much has ever been accomplished before in any American city for the same expenditures the government having large reservations in the city and the nation at large having an interest in their capital I recommend a liberal policy toward the District of Columbia and that the government should bear its just share of the expense of these improvements every citizen visiting the capital feels a pride for its growing beauty and that he too is part owner in the investments made here I would suggest to Congress the propriety of promoting the establishment in this district of an institution of learning or University of the highest class by the donation of lands there is no place better suited for such an institution than the national capital there is no place in which every citizen is so directly interested civil service reform the success of messages to Congress I have called attention to the subject of civil service reform action has been taken so far as to authorize the appointment of a board to devise rules governing methods of making appointments and promotions but there has never been any action making these rules or any rules binding or even entitled to observance where persons desire the appointment of a friend or the removal of an official who may be disagreeable to them to have any rules of the executive they must have the acquiescence of Congress as well as of the executive I commend therefore the subject to your attention and suggest that a special committee of Congress might confer with the civil service board during the present session for the purpose of devising such rules as can be maintained and which will secure the service of honest and capable officials and which will also protect them in a degree of independence while in office proper rules will protect Congress I would recommend for your favorable consideration the passage of an enabling act for the admission of Colorado as a state in the union it possesses all the elements of a prosperous state agricultural and mineral and I believe has a population now to justify such admission in connection with this I would also recommend the encouragement of a canal for purposes of irrigation from the eastern slope of the Rocky Mountains to the Missouri River as a rule I am opposed to further donations of public lands for internal improvements owned and controlled by private corporations but in this instance I would make an exception between the Missouri River and the Rocky Mountains there is an arid belt of public land from 300 to 500 miles in width perfectly value list for the occupation of man for the want of sufficient rain to secure the growth of any product an irrigating canal would make productive a belt as wide as the supply of water could be made to spread over across this entire country and would secure a cordon of settlements connecting the present population of the mountain and mining regions with that of the older states all the land reclaimed would be clear gain if alternate sections are retained by the government I would suggest that the retained sections be thrown open to entry under the homestead laws or sold to actual settlers for a very low price I renew my previous recommendation to Congress for general amnesty the number engaged in the late rebellion yet laboring under disabilities is very small but enough to keep up a constant irritation no possible danger can accrue to the government by restoring them to eligibility to hold office I suggest for your consideration the enactment of a law to better secure the civil rights freedom should secure but has not effectually secured to the enfranchised slave Ulysses S. Grant end of section 7 recorded by E. Winters section 8 of state of the union addresses 1869 to 1876 this is a LibriVox recording all LibriVox recordings are in the public domain for more information or to volunteer please visit LibriVox.org to the Senate and House of Representatives since the convening of Congress one year ago the nation has undergone a prostration in business and industries such as has not been witnessed with us for many years speculation as to the causes for this prostration might be indulged in without profit because as many theories would be advanced as there would be independent writers those who express their own views without borrowing upon the subject without indulging in theories as to the cause of this prostration therefore I will call your attention only to the fact and to some plain questions as to which it would seem there should be no disagreement during this prostration two essential elements of prosperity have been most abundant labor and capital both have been largely unemployed where security has been being undoubted capital has been attainable at very moderate rates where labor has been wanted it has been found in abundance at cheap rates compared with what's of necessaries and comforts of life could be purchased with the wages demanded two great elements of prosperity therefore have not been denied us a third might be added our soil and climate are unequaled within the limits of any contiguous territory under one nationality a variety of products to feed and clothe the people and in the amount of surplus to spare to feed less favored peoples therefore with these facts in view it seems to me that wise statesmanship at this session of congress would dictate legislation ignoring the past directing in proper channels these great elements of prosperity to any people debt debt abroad is the only element that can with always a sound currency enter into our affairs to cause any continued depression in the industries and prosperity of our people a great conflict for national existence made necessary for temporary purposes the raising of large sums of money from whatever source attainable it made it necessary in the wisdom of congress and I do not doubt their wisdom and the premises regarding the necessity of the times to devise a system of national currency which it proved to be impossible to keep on a par with the recognized currency of the civilized world this begot a spirit of speculation involving an extravagance and luxury not required for the happiness or prosperity of a people and involving both directly and indirectly for an indebtedness the currency being a fluctuating value and therefore unsafe to hold for legitimate transactions requiring money became a subject of speculation and self these two causes however have involved us in a foreign indebtedness contracted in good faith by borrower and lender which should be paid in coin and according to the bond agreed upon when the debt was contracted gold or its equivalent the good faith of the government cannot be violated toward creditors without national disgrace but our commerce should be encouraged American shipbuilding and carrying capacity increased foreign markets sought for products of the soil and manufacturers and to the end that we may be able to pay these debts where a new market can be created for the sale of our products either of the soil the mine or the manufactory a new means is discovered of utilizing our idle capital and labor to the advantage of the whole people but in my judgment the first step toward accomplishing this object is to secure a currency a stable value a currency good wherever civilization reigns one which if it becomes super abundant with one people will find a market with some other a currency which has as its basis the labor necessary to produce it which will give to it its value gold and silver are now the recognized medium of exchange the civilized world over and to this we should return with the least practicable delay to the pledges of the American Congress when our present legal tender system was adopted and debt contracted there should be no delay certainly no unnecessary delay in fixing by legislation a method by which we will return to species to the accomplishment of this end I invite your special attention I believe firmly that there can be no prosperous and permanent revival of business and industries until a policy is adopted with legislation to carry it out looking to a return to a species basis it is easy to conceive that the debtor and speculative classes may think it of value to them to make so-called money abundant until they can throw a portion of their burdens upon others but even these I believe would be disappointed in the result if a course should be pursued which will keep in doubt the value of the legal tender medium of exchange a revival of productive industry is needed by all classes by none more than the holders of property of whatever sort with the debts to liquidate from realization upon its sale but admitting that these two classes of citizens are to be benefited by expansion would it be honest to give it would not the general loss be too great to justify such relief would it not be just as honest and prudent to authorize each debtor to issue his own legal tenders to the extent of his liabilities than to do this would it not be safer for fear of over issues by unscrupulous creditors to say that all debt obligations are obliterated in the United States and now we commence anew each possessing all he has at the time free from encumbrance these propositions are too absurd to be entertained for a moment by thinking or honest people yet every delay in preparation for final resumption partakes of this dishonesty and is only less in degree as the hope is held out that a convenient season will at last arrive for the good work of redeeming our pledges to commence it will never come in my opinion except by positive action by Congress or by national disasters which will destroy for a time at least the credit of the individual and the state at large a sound currency might be reached by total bankruptcy and discredit of the integrity of the nation and of individuals I believe it is in the power of Congress at this session to devise such legislation as will renew confidence revive all the industries start us on a career of prosperity to last for many years and to save the credit of the nation and of the people steps towards the return to a species basis are the great requisites to this devoutly to be sought for and which I may touch upon here after a nation dealing in a currency below that of species in value labor's under two great disadvantages first having no use for the world's acknowledged medium of exchange gold and silver these are driven out of the country because there is no need for their use second the medium of exchange in use being of a fluctuating value for after all it is only worth just what it will purchase of gold and silver metals having an intrinsic value just in proportion to the honest labor it takes to produce them a larger margin must be allowed for profits by the manufacturer and producer it is months from the date of production to the date of realization interest upon capital must be charged and risk of fluctuation in the value of that which is to be received in payment added hence high prices as a protection to the foreign producer who receives nothing in exchange for the products of his skill and labor except a currency good at a stable value the world over it seems to me that nothing is clear than that the greater part of the burden of the existing prostration for the want of a sound financial system falls upon the working man who must after all produce the wealth and the salaried man who super intends and conducts business the burden falls upon them in two ways by the deprivation of employment and by the decreased purchasing power of their salaries it is the duty of Congress to devise the method of correcting the eagles which are acknowledged to exist and not mine but I will venture to suggest two or three things which seem to me as absolutely necessary to a return to species payments the first great requisite in a return to prosperity the legal tender clause to the law authorizing the issue of currency by the national government should be repealed to take effect as to all contracts entered into after a day fixed in the repealing act not to apply however to payment of salaries by government or for other expenditures now provided by law to be paid in currency in the interval pending between repeal and final resumption provision should be made by which the secretary of the treasury can obtain goals that may become necessary from time to time from the date when species redemption commences to this might and should be added a revenue sufficiently in excess of expenses to ensure an accumulation of gold in the treasury to sustain permanent redemption I commend this subject to your careful consideration believing that a favorable solution is attainable and if reached by this congress that the present and future generations will ever gratefully remember it as their deliverer from a thralldom of evil and disgrace with the resumption free banking may be authorized with safety giving the same full protection to billholders which they have under existing laws indeed I would regard free banking as essential it would give proper elasticity to the currency as more currency should be required for the transaction of legitimate business new banks would be started and in turn banks would wind up their business when it was found that there was a super abundance of currency the experience and judgment to the people can best decide just how much currency is required for the transaction of the business of the country it is unsafe to leave the settlement to this question to congress the secretary of the treasury or the executive congress should make the regulation under which banks may exist but should not make banking a monopoly by limiting the amount of redeemable paper currency that shall be authorized such importance do I attach to this subject and so earnestly do I commend it to your attention that I give it prominence by introducing it at the beginning of this message during the past year nothing has occurred to disturb the generally friendly and cordial relations of the United States with other powers the correspondence submitted here with between this government and its diplomatic representatives as also with the representatives of other countries shows a satisfactory condition of all questions between the United States and the most of those countries and with few exceptions to which references hereafter made the absence of any points of difference to be adjusted the notice directed by the resolution of congress of June 17 1874 to be given to terminate the convention of July 17 1858 between the United States and Belgium has been given the treaty will accordingly terminate on the first day of July 1875 this convention secured to certain Belgian vessels entering the ports of the United States exceptional privileges which are not accorded to our own vessels other features of the convention have proved satisfactory and have tended to the cultivation of mutually beneficial commercial intercourse and friendly relations between the two countries I hope that negotiations which have been invited will result in the celebration of another treaty which may tend to the interests of both countries our relations with China continue to be friendly during the past year the fear of hostilities between China and Japan growing out of the landing of an armed force upon the island of Formosa by the latter has occasioned uneasiness it is earnestly hoped however that the difficulties arising from this cause will be adjusted and that the advance of civilization of these empires may not be retarded by a state of war in consequence of the part taken by certain citizens of the United States in this expedition our representatives in those countries have been instructed to impress upon the governments of China and Japan the firm intention of this country to maintain strict neutrality in the event of hostilities and to carefully prevent any infraction of law on the part of our citizens in connection with this subject the attention of Congress to a generally conceded fact that the great proportion of the Chinese immigrants who come to our shores do not come voluntarily to make their homes with us and their labor productive of general prosperity but come under contracts with headman who own them almost absolutely in a worse form does this apply to Chinese women hardly a perceptible percentage of them perform any honorable labor but they are brought for meaningful purposes to the disgrace of the communities where settled under the great demoralization of the youth of those localities if this evil practice can be legislated against it will be my pleasure as well as duty to enforce any regulation to secure so desirable an end it is hoped that negotiations between the government of Japan and the treaty powers looking to the further opening of the empire under the removal of various restrictions upon trade and travel may soon produce the results desired which cannot fail to an order the benefit of all the parties having on previous occasions submitted to the consideration of Congress the propriety of the release of the Japanese government from the further payment of the indemnity under the convention of October 22nd 1864 and as no action had been taken there on it became my duty to regard the obligations of the convention as in force and as the other powers interested had received their portion of the indemnity in full the minister of the United States in Japan has in behalf of this government received the remainder of the amount due to the United States under the convention of Shimonosaki I submit the propriety of applying the income of the part if not of the whole of this fund to the education in the Japanese language of a number of young men to be under obligations to serve the government for a specified time as interpreters at the consulates in Japan a limited number of Japanese youths might at the same time be educated in our own vernacular and mutual benefits would result to both governments the importance of having our own citizens competent and familiar with the language of Japan to act as interpreters and other capacities connected with the legation and the consulates in that country cannot readily be overestimated the amount awarded to the government the great Britain by the mixed commission organized under the provisions of the treaty of Washington and settlement of the claims of British subjects arising from acts committed between April 13th 1861 and April 9th 1865 became payable under the terms of the treaty within the past year and was paid upon the 21st day of September 1874 in this connection I renew my recommendation made at the opening of the last session of Congress the special court be created to hear and determine all claims of aliens against the United States arising from acts committed against their persons or property during the insurrection it appears equitable that opportunity should be offered to citizens of other states to present their claims as well as to those British subjects whose claims were not admissible under the late commission to the early decision of some competent tribunal to this end I recommend the necessary legislation to recognize a court to dispose of all claims of aliens of the nature referred to in an equitable and satisfactory manner and to relieve Congress and the departments from the consideration of these questions the legislation necessary to extend to the colony of Newfoundland certain articles of the treaty of Washington of the 8th day of May 1871 having been had a protocol to that effect was signed in behalf of the United States and of Great Britain on the 28th day of May last and was duly proclaimed on the following day a copy of the proclamation is submitted herewith a copy of the report of the commissioner appointed under the act of March 19 1872 for surveying and marking the boundary between the United States and the British possessions from the lake of the woods to the summit of the Rocky Mountains is herewith transmitted I am happy to announce that the field work of the commission has been completed the entire line from the northwest corner of the lake of the woods to the summit of the Rocky Mountains has been run and marked upon the surface of the Earth it is believed that the amount remaining unexpended of the appropriation made at the last session of Congress will be sufficient to complete the office work I recommend that the authority of Congress be given to the use of the unexpended balance of the appropriation and the completion of the work of the commission in making its report and preparing the necessary maps the courts known as the Court of Commissioners of Alabama claims created by an act of Congress of the last session has organized and commenced its work and it is to be hoped that claims admissible under the provisions of the act may be speedily ascertained and paid it has been deemed advisable to exercise the discretion conferred upon the executive at the last session by accepting the conditions declared by the government of Turkey for the privilege of allowing citizens of the United States to hold real estate in the former country and by assenting to a certain change in the jurisdiction of courts in the latter a copy of the proclamation upon these subjects is herewith communicated there has been no material change in our relations with the independent states of this hemisphere which were formerly under the dominion of Spain marauding on the frontiers between Mexico and Texas still frequently takes place despite the vigilance of the civil and military authorities in that quarter the difficulty of checking such trespasses along the course of a river of such length as the Rio Grande and so often affordable is obvious it is hoped that the efforts of this government will be seconded by those of Mexico to the effectual suppression of these acts of wrong from a report upon the condition of the business before the American and Mexican joint claims commission made by the agent on the part of the United States and dated October 28th 1874 it appears that of the one thousand and seventeen claims filed on the part of citizens of the United States four hundred and eighty three have been finally decided and seventy five were in the hands of the umpire leaving four hundred and sixty two to be disposed of and of the nine hundred and ninety eight claims filed against the United States seven hundred and twenty six have been finally decided one was before the umpire and two hundred and seventy one remain to be disposed of since the date of such reports other claims have been disposed of reducing somewhat the number still pending and others have been passed upon by the arbitrators it has become apparent in view of these figures and of the fact that the work devolving on the umpire is particularly laborious that the commission will be unable to dispose of the entire number of claims pending prior to the first day of February 1875 the date fixed for its expiration negotiations are pending looking at the securing of the results of the decisions which have been reached and to a further extension of the commission for a limited time which it is confidently hoped will suffice to bring all the business now before it to a final close a strife in the Argentine Republic is to be deplored both on account of the parties there too and from the probable effects on the interests of those engaged in the trade to that quarter of whom the United States are among the principal and yet so far as I am aware there's been no violation of our neutrality rights which as well as our duties in that respect it shall be my endeavor to maintain and observe it is with regret that I announce that no further payment has been received from the government of Venezuela on account of awards in favor of citizens of the United States hopes have been entertained that if that Republic could escape both foreign and civil war for a few years its great natural resources would enable it to honor its obligations though it is now understood to be at peace with other countries a serious insurrection is reported to be in progress in an important region of that Republic this may be taken advantage of as another reason to delay the payment of the dues of our citizens the deplorable strife in Cuba continues without any market change in the relative advantages of the contending forces the insurrection continues but Spain has gained no superiority six years of strife give to the insurrection a significance which cannot be denied its duration and the tenacity of its adherence together with the absence of manifested power of suppression on the part of Spain cannot be controverted and may make some positive steps on the part of other powers a matter of self necessity I had confidently hoped at this time to be able to announce the arrangement of some of the important questions between this government and that of Spain but the negotiations have been protracted the unhappy and testined dissensions of Spain command our profound sympathy and must be accepted as perhaps a cause of some delay an early settlement in part at least of the questions between the governments is hoped in the meantime awaiting the results of immediately pending negotiations I defer a further and fuller communication on the subject of the relations of this country and Spain I have again to call the attention of Congress to the unsatisfactory condition of the existing laws with reference to expatriation and the election of nationality amid conflicting opinions and decisions it was difficult to exactly determine how far the doctrine of perpetual allegiance was applicable to citizens of the United States Congress by the act of the 27th of July 1868 asserted the abstract right of expatriation as a fundamental principle of this government notwithstanding such assertion and the necessity of frequent application of the principle no legislation has been had defining what acts or formalities shall work expatriation or when a citizen shall be deemed to have renounced or to have lost his citizenship the importance of such definitions is obvious the representatives of the United States and foreign countries are continually called upon to lend their aid and the protection of the United States to persons concerning the good faith or the reality of whose citizenship there is at least great question in some cases the provisions of the treaties furnish some guide in others it seems left to the person claiming the benefits of citizenship while living in a foreign country contributing in no manner to the performance of the duties of a citizen of the United States and without intention at any time to return and undertake those duties to use the claims to citizenship of the United States simply as a shield from the performance of the obligations of a citizen elsewhere the status of children born of American parents residing in a foreign country of American women who have married aliens of American citizens residing abroad where such question is not regulated by treaty are all sources of frequent difficulty and discussion legislation on these and similar questions and particularly defining when and under what circumstances expatriation can be accomplished or is to be presumed is especially needed in this connection I earnestly call the attention of Congress to the difficulties arising from fraudulent naturalization the United States wisely freely and liberally offers its citizenship to all who may come in good faith to reside within its limits on their complying with certain prescribed reasonable and simple formalities and conditions among the highest duties of the government is that to afford firm sufficient and equal protection to all its citizens whether they are born or naturalized care should be taken that a right caring with it such support from the government should not be fraudulently obtained and should be bestowed only upon full proof of a compliance with the law and yet frequent instances are brought to the attention of the government to the illegal and fraudulent naturalization and of the unauthorized use of certificates thus improperly obtained in some cases the fraudulent character of the naturalization appeared upon the face of the certificate itself in others examination discloses that the holder had not complied with the law and in others certificates have been obtained where the persons holding them not only were not entitled to be naturalized but had not even been within the United States at the time of the pretended naturalization instances of each of these classes of fraud are discovered in our legations where the certificates of naturalization are presented either for the purpose of obtaining passports or in demanding the protection of the legation when the fraud is apparent on the face of such certificates they are taken up by the representatives of the government and forwarded to the Department of State but even then the record of the court in which the fraudulent naturalization occurred remains and duplicate certificates are readily obtainable upon the presentation of these for the issue of passports or in demanding protection of the government the fraud sometimes escapes notice and such certificates are not infrequently used in transactions of business to the deception and injury of innocent parties without placing any additional obstacles in the way of the obtainment of citizenship by the worthy and well-intentioned foreigner who comes in good faith to cast his lot with ours I earnestly recommend further legislation to punish fraudulent naturalization and to secure the ready cancellation of the record of every naturalization made in fraud since my last annual message the exchange has been made of the ratification of treaties of extradition with Belgium, Ecuador, Peru and Salvador also the treaty of commerce and navigation with Peru and one of commerce and consular privileges with Salvador all of which have been duly proclaimed as has also the declaration with Russia with reference to trademarks the report of the secretary of the treasury which by law is made directly to Congress and forms no part of this message will show the receipts and expenditures of the government for the last fiscal year the amount received from each source of revenue and the amount paid out for each of the departments of government it will be observed from this reports that the amount of receipts over expenditures will mean but $2,344,882.30 for the fiscal year ending June 30th 1874 and that for the current fiscal year the estimated receipts over expenditures will not much exceed $9 million in view of the large national debt existing and the obligation to add 1% per annum to the sinking fund a sum amounting now to over $34 million per annum I submit whether revenues should not be increased or expenditures diminished to reach this amount of surplus not to provide for the sinking fund is a partial failure to comply with the contracts and obligations of the government at the last session of Congress a very considerable reduction was made in rates of taxation and in the number of articles submitted to taxation the question may well be asked whether or not in some instances unwisely in connection with this subject to I venture the opinion that the means of collecting the revenue especially from imports have been so embarrassed by legislation as to make it questionable whether or not large amounts are not lost by failure to collect to the direct loss of the treasury and to the prejudice of the interests of honest importers and taxpayers the secretary of the treasury in his report favours legislation looking to an early return to species payments thus supporting views previously expressed in this message he also recommends economy and appropriations calls attention to the loss of revenue from repealing the tax on tea and coffee without benefit to the consumer recommends an increase of 10 cents a gallon on whiskey and further that no modification be made in the banking and currency bill most of the last session of Congress unless modification should become necessary by reason of the adoption of measures for returning to species payments in these recommendations I cordially join I would suggest to Congress the propriety of readjusting the tariff so as to increase the revenue and at the same time decrease the number of articles upon which duties are levied those articles which enter into our manufactures and are not produced at home it seems to me should be entered free those articles of manufacture which we produce a constituent part of but do not produce the whole that part which we do not produce should enter free also I will instance fine wool, dyes, etc these articles must be imported to form a part of the manufacture of the higher grades of woolen goods chemicals used as dyes, compounded medicines used in various ways in manufactures come under this class the introduction free of duty of such wools as we do not produce would stimulate the manufacture of goods requiring the use of those we do produce and therefore would be a benefit to home production there are many articles entering into home manufactures which we do not produce ourselves the tariff upon which increases the cost of producing the manufactured article all corrections in this regard are in the direction of bringing labour and capital in harmony with each other and of supplying one of the elements of prosperity so much needed End of section 8 Recording by Owen Cook in Pottawatomie Seated Land