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ARBITRATION TAKES PLACE OF CONFLICT Powers Won Over to Way of Peace. MFT'SEES GREAT PROGRESS Special Message Discusses Year's intercourse With 'Other Countries. REVIEWS MEXICAN CIVIL WAR Mobilization of American Troops on Southern Border Explained For. ' clgn Trade Relatlons-Need For "American Merchant Marina, Washington, Deo, 7. Prosldcnt Taft today eont to congross a spoclal mes sage on foreign rolatlonB. The mes sage folio wd: Too rolntlonfl or the United SUtes with other countries havo continued during tho past twelve months upon a basts of tho usual good will and friendly Intercourse. Arbitration. Tho year Just passed marks an lm portantjgeneral movement on the part of the powers for broader arbitration. In the recognition of the manifold benefits to maklnd In tho extension of the policy of the settlement of Inter national disputes by arbitration rather than by war, ami In response to a widespread demand for an advance Is that direction on the part of the peo ple of the United States and of Great Britain and of France, new arbitration treaties were negotiated last spring with Great Britain and France, the terms of which were designed, as ex pVeeaed In the preamble of these treaties, to extend the scope and obli gations of the policy of arbitration adopted In our prosent treaties with those governments. To pave tho way for this treaty with the United States, Great Drltaln negotiated an Important modification In Its alliance with Japau, and the French government also ex pedited the negotiations with signal good will. The new treaties have been submitted to the senate and are awaiting Its advice and consent to their ratification, All the essentials of these Important treaties have long been known, and It Is my earnest hope that they will receive prompt and favorable action, Clalm-of Alsop & Co. Settled, I am glad to report that on July 6 last tbe American claim of Alsop & Co. against the government of Chile was finally disposed of by the decision of his Britannic majesty George V., to whom, as amiable compositeur, the matter had been referred for deter mination. His majesty made an award of nearly 11,000,000 to the claimants, which wag promptly paid by Chile. The settlement of this con troversy has happily eliminated from ike relations betwen the republlo or Chile and the United States the only question which for two decades had given the two foreign offices any seri ous concern and makea possible the unobstructed development of the rela tions of friendship which It has been the aim of this government In every possible way to further and cultivate. Arbitrations, la further Illustration of the practi cal and beneficent application of. the principle of arbitration and the under lying broad spirit of conciliation, I am happy te advert to the part of the United States In facilitating amicable settlement of disputes which menaced the peaea between Panama and Costa Klca and between Haiti and tbe Do ulnleftK republic, Since the date of their Independ ence, Colombia and Costa Ittca bad been seeking a solution of a boundary diepute. which eame as a heritage from Colombia to the new republle ot Panama upon its beginning life as an ladepeadent nation. Although the din putaats had submitted this question ipr decision to the president of France under the terms of an arbitra tion treaty, the exact Interpretation of the provisions of the award ren dered had teen a matter of serious disagreement between the two ceua trles, both contending for widely dif ferent lines even under the terms of the decision. Subsequently and since. 1903 this boundary question had bees the subject of fruitless dlpiomatlo ne gotiations between the parties, in January, 1810, at the repeat ot both governments the agents repressing them met la conference at tbe depart ment of state and subsequently eon eluded a protoaol submitting this long, pending controversy to the arbitral Judgment of the chief Justice of the United States, who consented to act ta this eapaetty. A boundary eommla slow, Recording to the International agreement, has sow been appelated, and It Is expected that the arguments will shortly proceed and that this long standing dispute will he honorably aad satisfactorily terminated. Again, a few jaeetba o Itapfieared 1 1 " - tbnt tho Dominican republic and Hall woro about to enter unon hostilities becauso of complications growing out of an acrimonious boundary dispute which tho efforts ot many years had failed to eolvo. The government of the United States, by a friendly Inter position of good o HI cot, succeeded la prevailing uopn the parties to place tbolr reliance unon some form of eacl- flo settlement Accordingly, oa the friendly suggestion of this govern ment, tne two governments empow orcd commissioners to meet at Wash Ington In conference at the state de partment In order to arrange the terms ot submission to arbitration ot the boundary controversy. Chamlzal Arbitration Nat Satlafaeterv Our arbitration of the Chamlzal boundary Question with Mexico was unfortunately abortive, but with the earnest efforts oa the part of both governments which Its Importance commands, it Is felt that an early practical adjustment should prove pos sible. Mexfee. The recent political events la Mexi co received atteatlou from this gov ernment because of the exceedinair delicate and difficult situation created along our southern border and the ne cessity for taking moasures properly to safeguard American Interests. Thn government of tho Unltod States, la its doslro to secure a propor observ ance and enforcement of tho oo-callod neutrality statutos of tho federal kov- ernment, Issued directions to the an- proprlato officers to exercise a dill- gont and vigilant regard for tho re quirements of such rules and laws, Al though a condition of actual armod conflict existed, thcro was no official recognition of bolllgorcncy Involving tho technical neutrality obligations ot International law. On the 0th ot March last. In tho ab sence of tho socrctary of stato, 1 had n personal Intorvlow with Mr. Wilson, tno ambassador of tho United States to Mexico, In which ho roportod to mo that tho conditions In Mexico wore much more critical than tho pross dls patchos disclosed; that President Diaz was on a volcano of popular uprising; that the small outbreaks which bad occurrod wore only Bymptomatlo of tho whole condition; that a very large per cent of the people were In sym pathy with tho Insurrection; that a general explosion was probable at any time, in which enso ho foarcd that the 440,000 or more American residents In Mexico might bo BBsallcd, and that tho very largo Amorlcan invontmenta might be' Injured or destroyed. After a conference with the secre tary of war and tho secretary of the navy, I thought It wise to assemble an army division of full strength at San Antonio, Tex., a brigade of three regi ments nt Galveston, a brigade ot In fantry In tho Los Angeles district ot Southern California, together with a squadron of battleships and cruisers and transports at Galveston, and a small squadron ot ships at ,San Diego. At the same time, through our repre sentative at the City of Mexico, I ex pressed to President Diaz the hope that no apprehensions might result from unfounded conjectures as to these military maneuvers, and as sured him that they had no signifi cance which should cause concern to his government The mobilization was effected with great promptness, and on the 16th ot March, through the secretary ot war and the secretary ot the navy, In a let ter addressed to the chief ot staff, I Issued the following Instructions: "It seems my duty as commander In chief to place troops In sufficient number where, if Congress shall di rect that they enter Mexico to save American lives and property, an ef fective movement may be promptly made. Meantime, the inovemont ot the troops to Texas and elsewhere near the boundary, accompanied with sin cere assurances ot the utmost good will toward the present Mexican gov ernment and with larger and more frequent patrols along the border to prevent Insurrectionary expeditions from American soil, will hold up the hands ot tho existing government and will have n healthy moral effect to pre vent attacks upon Americans and their property In any subsequent gen eral internecine strife. Again, the sudden mobilization ot a division of troops has been a groat test ot our army and full of useful instruction, wiuia the maneuvers that are thus made possible can occupy the troops and their officers to great advantage. rue assumption by tho press that I contemplate Intervention on Moxlcan soil to protect American lives or prop erty Is ot course gratuitous, because I seriously doubt whether I have such authority under any clrcurastancos, ana i; i itau l would not exercise it without express congressional ap proval. My determined purpose, how ever, Is to be In a position so that When danger to American lives and property la Mexico threatens and the qxlsttns governmont la rondorcd holp leea by the insurrection, I can prompt ly execute congressional orders to protect them, with effect "Meantime, I send you this letter. through the secretary, to call your attention to some things in connection wim tee preeeace or tae division la the aouthweet which have doubtless occurred to you, but which I wish to emphasize. "In the first place, I want to make the mobilization a first-class training for the army, and I wish you would give your time and that of the war college to a4vtslag aad carrying out maneuvers of a useful character, aad plan to continue to do this durlag tha next three months. By that tlaie we may expect that either Amhaseador Wilson's fears will have, been realized aad chaos and -Us consequeacea hava ensued, or that the present govern ment of Mexico will have so read- Justed mattors as to secure tranquillity a result devoutly to he wished. Thn troops can thon bq returned to their posts. "Second, Texas la a state ordinarily peaceful, bat you. caa not pat $$,00 troops Into" It without raaalag iima risk of a colllslea between tha peo ple of the slate, and especially the Mexicans who llvn in Ttiu near the border and who sympathise with tho insurrectos, and tbe federal soMfers. jror that reason I beg you to he as careful as you can to prevent friction of any kind. "Third, One of the great treaties In tbe coflcentmtlo of troon la the danger of disease, aad I suppose that you nave adopted tee most medera methods or the preventing aad, if necessary, for stamnlnar out enldeealea. That Is so much a part of a earn paiga mat It hardly seems aeeessary for me to call attention to it "Finally. 1 wish you to examine thn question of the patrol of the herder ana put as many troops oa that work as la nractlrahla and now enKSKOd In It. In order tj nrarant the use of our borderland for the carrying on of the Insurrection. 1 have given assurances to the Mexican am bassador on this polat I sincerely hone that this exnerl- ence will always be remembered by the army and navv na a tisAfnl maana of education, and I should be greatly disappointed It it resulted in any In Jury or disaster to our forces from any cause. I hnvo taken a good deal of responsibility In ordering this mobil ization, but I am rnndv in ntiitriir fnr it If only you and those under you UBO tho Utmost earn to avoid thn illf. flcultleB which I havo pointed out" i nm moro than happy to here ro- COrd the fact that nil annrehfinHlnnn as to tho effect of the presence of so largo a military force In Texas proved groundless; no disturbances occurred. From tlmo to tlmo communications woro roccivod from Ambassador "Wll. son, who had returned to Moxlco, con firming tho vlow that tho massing of Amorlcan troonfl In the netzhhnrhnnd had had good effect The Insurrection continued and ,r- suited In engagements between tho regular Mexican trnnnn nml (hn Incur. gents, and this along the border, so max in several instances bullets from the contending forces struck American citizens engaged in their lawful oeeu. nations on American soli. ' Pro DO r nrotosta worn mndn ncralnHl thcoo invasions of Amorlcan rights to tno Mexican authorities. The presence ot a lares military and naval forco available for prompt action, near the Mexican border. proved to' bo most fortunate under the somewhat trying conditions presented by this Invasion of American rights. Had no movement therntofnrn tafcnn place, and becauBO of these ovents It nau been necessary then to bring about tho mobilization, It must havo had sinister significance. On ttio Other hand, tho presence of the troops perore ana at tne tlmo of the unfof" tunato killing and wounding of Amer ican citizens at Douglas, made clear that the restraint exercised by our government In regard to this occur rence was not due to a lack ot force or power to deal with It promptly and aggressively, but wsb due to a real desire to use every moans possible to avoid direct intervention In tho af fairs of our neighbor, whose friend ship we valued and wore most anxious to retain The policy and action of this rov. ernment were based upon an earnest rricnaiinesa for tbe Mexican people as a whole, and It Is a matter of gratification tn notn flint thin nfi..A - - - . - ... - - - ....... .i fc..tUUU of 'strict Impartiality as to all fac tions in Mexico and of sincere friend ship for the neighboring nation, with out regard for party allegiance, has boen generally recognized and has resulted, in an even closer and more sympathetic understanding between the two remibllcB and a warmer re gard one for the othor. Action to suppress violence and restore tran quility throughout tho Moxlcan ropub llo was of peculiar Interest to thin government, In thnt It concerned tho safeguarding of Amorlcan llfo and property In that country. On May 25, 1911, Prcsldont Diaz resigned, Senor do la Barra was chosen provisional president Elections- for president and vice-president wern thomnriJiv held throughout the republlo, and Henor, Francisco I. Madero was for mally declared elected on October IB to tho chief magistracy. On Norem. ber 0 Prcsldont Mndoro ontered upon we iiuiioa oi his omco. Honduras and Nicaragua Treaties Proposed. As to tho situation in nontni America, I havo taken occasion In tho past to emphaslzo most strongly tho Importance that should bo attrlbutod to tho consummation ot the conven tions between the Itopubllcs of Nica ragua and ot Honduras and this country, and I again earnestly rccom mond that tho necessary advlco and concent ot tbe eonato be accordod to these treaties, which will make It pos sible for these Central Amorlcan re publics to eater upon an era of genu ine economlo national development Our relations with the Republlo ot Panama, peculiarly important, dua to mutual obligations and the vast in terests created by the canal, hava continued In the usual friendly man ner, and we have been glad to make appropriate expression of our atti tude of sympathetic Interest In the endeavors of our neighbor In undertak ing the development of tho rich re sources ot the country. The Chinese toans, The past year has been marked la our relations with China by the con clueloa of two Important Internatloa al loans, one (or the construction of the Hukuaag railways, the other for the earryleg out ot the currency re form to which China was pledged by treaties with the United States, Great Britain, and Japan, of which men tlon was made in my last annual mes sage. Knowing tho Intercut ef the United StMe la the reform ot Chinese cur rency, tha ChlniMMi aroTerntoMit. the autumn ot 1910, sought the assist ance ot the Amerlcaa government to procure fuads with whkh to accom plish that all-lmportaat reform. la the course of the suhsequeat aefotla tlons there waa eembtaed with the proposed currency loan one for cer- wa MiwrKii aeveiopmeats la, w is churia, the two loans aarrecatlnr tha sum of W.WO,000. While this was originally to be solely aa Amerlcaa enterprise, the Amerlcaa government consistently with 1U daaire to secure a sympathetic and practical co-opera tion or the great powers toward main taining the principle ot equality of opportunity and the administrative In tegrity of China, urged the Chinese government to admit to participation la the currency loan the associates OI IMS AttlfM-lran vrnun In 4 Via Uu. kuaag loan. While ot Immense lm POrtaaCO In Itonir ) rtnrm An. templaled la making this loaa Is but preliminary to nthni- and prehenslve fiscal rfnnn whixh win oe or incalculable benefit to China and foreign Interests alike, since they will strengthen the Chinese empire and promote tne rapid development of in ternational trade. When these gun, It was understood that a financial aaviaor was to bo employed by China. In connection with tho reform, and in order thnt absolufn nrmnlltv In all respects nmong tho lending nations might bo scrupulously obsorved, the Amorlcan governmont proposed the nomination of a noutral advisor, which Was agrood to by China and ttia nltinr governmonts concerned. On Soptem bor 28. 1911. Doctor dont of tho Dutch Java bank and a nnnnclor of wide experience In the Orient, was recommended to the Chl- neso governmont for tho post of mone tary adviser. Especially Important nt when tho ancient Chinese empire Is shaken by civil war Incidental to its awakening to the many Influences and activity of modernization, are the co operative policy of Rood undernlnndlnt? which has been fostered by the Inter national projects referred to above and tho general sympathy of view among all the powors Interested In the far east New Japanese Treaty. The treaty of rnmmorco nrf nl. tlon between tho United States and Japan, signed In 1894, would by a strict Interpretation of Its provisions hnvo terminated on July 17. 1012. Jan. an's general treaties with tho other powers, however, terminated In ion. and the Japanese government ex pressed nn earnest desire to conduct the negotiations for a now treaty with tne united states simultaneously with Its negotiations , xvlth the othor pow ers. Thoro were a number of lmnor- tant questions Involved In the treaty, Including tho Immigration of laborers, revision of the customs tar iff and the right ot Americana to hold real estate In Japan. .The United States consented tj waive all techni calities and to enter at once upon ne gotiations for a now treaty on the un derstanding that thero should be a continuance throughout the life of the treaty of the same effective measures for the restriction of Immigration of laborers to American territory which had been In operation with entire sat- iBinctlon to both governments since 1908. The Japanese government ac cepted this basis ot negotiation, nnd a now treaty was quickly concluded, resulting in a highly satisfactory set tlement of the other questions re ferred to. A satisfactory adjustment haa alno ben effected of the aueatlon trrnwlne out of the annexation of Korea by Japan. Europe and the Near East In Europe and tho noar oast, durinir the past twelve month, there has been at times considerable nolltlcal unmet. The Moroccan question, which for porno mouths was tho cause of great anxiety, happily appears to have reacued a stage at which It need no longer be regarded with concern. Tha Ottoman empire was oocupled for a period by strife In Albania and Is now at war with Italy. In Greece and the Balkan countries tho dlsuuletlne no- tentlalttlos of this situation havo been. more or less folt Persia has been tha scene ot a long internal struggle. These conditions have boon the of uneasiness In European diplomacy, but thus fnr without direct political ! concern to tho United States. la 'tho war which unhanollv exists between Italy and Turkey this gov ernment has no direct political Inter est and I took occasion at thn aulta- ble tlmo to Issue a proclamation ot noutraiity in that, conflict. At the same tlmo all necessary steps have beea takon to safeguard the personal Interests ot American citizens and or ganisations In so tar aa affected by the war. In snlte of the attendant eaonnmiA uncertainties aad detriments te com merce, tho United States has aralnad markedly In lta commercial standing with certain ot the nations of the near east Turkey, especially, la be ginning to come into closer relations with the United States through (ha new interest ot American manufactur ers RB a exporters in the possibilities ot those regloas, and It Is hoped that foundations are balna laid for a larra and mutually beneficial exchange of commodities betweea the pwo coun tries. International Cenventlona and Confer ences. The supplementary protocol to Tha Hague convention for the establish ment of on International prize court, mentioned In my last annual message, embodying stipulations providing for an alternative procedure which would remove the coaetltuttoaat objection to that part of The Hagae convention which provides that there may be aa appeal to tho proposed court from the decisions of national courts, has re ceived the signature of the govern meats parties to the original conven tion aad has beea ratified by the gor ernment of the United States, together with the prize court convention. The deposit of the ratifications with the gbverameat ot the Netherlands awaits action by the powers oa the declaration, signed at London on Feb ruary 26, 1909, of tbe rules of Interna tional law w be recognized within the meaning ef article seven ot The Hague cenventlea tor the establishment of aa International prize court Fur-Seal Treaty. The fur-seal controversy, which for nearly twenty-five years has been the source of serious frictloa betweea tho United States and the powers border lax UDOll the north PaelBn cvoan. whose subjects have been permitted to engage in pelagic sealing against the fur-aoat tlarda' tiavltlB. tViaJt- kraaJIna - " " . -? 111 ...v.. kll V . U lll) grounds within the Jurisdiction of the united States, has at last been satis factorily adjusted by the conclusion ot the North Pacific sealinx convention entered into between tha ITnltcd States, Great Britalri, Japan and Itus sla on the EOvcnth of July last. This convention Is a conservation measure or yory great Importance, aad If It Is carried out In the sulrlt of rfecfhroeal concession and advantage upon which it is unscu, tnoro Is ovory reason to be Hevo that not only will It rosult In pre serving tho fur-ncal horde of tho north Pacific ocean and restoring them to their former valuo'for thn ntirnntrx of commerce but also that It will ntfnrd a permanently satisfactory settlement oi a quostipn tno only other solution of which seemed to ho thn total do. structlon of tho fur seals. In another aspect, also, this convention is ot Im portance in that It flimlnhoa an 111, ,o. tratlon of the feasibility of securing a general International game law for the protection of other mammals ot the sea, tho preservation of whlnh la nf Importance to all tho nations of the world. Tho attention of conn-ess Is esneetl. ly called to the necessity for legisla tion on tho part of the United States for the DUmoSO of ftllfllllncr tha nhlla. tlons assumed under this convention, to wmch tho senate gave Its advice and consent on the twentv.fnurth dav of July last International Opium Commission. In a special messaKo transmitted to the congress on tho seventh of Janu ary, 1911, In which I concurred In the recommendations made by the secre tary Ot StatO In record to certain ful legislation for the control of our interstate and forelgu traffic In opium aad other monaclne. druH. I mm! ad from my annual message of Decem ber 7, 1909, In 'which I announced thnt tho results ot the International Opium commission hold at Shanghai In fiVh. ruary, 1909, at tho invitation of the United States, had boen laid before this government: that thn rnnnrt nf that commission showed that China was making rcmarkablo progress and admirable efforts toward tho eradlnn. tlon of tho opium evil; that the Inter ested governments had not permitted their commercial interests to prevent their cc-operatlon in this reform; and, aa a result of collateral lnvestlnationa of the opium question In this country, I recommended that the manufacture, sale and use of onhim In tha TTnltad mates should be .more rigorously con-. troiieu oy legislation. Prior to that time and n contlmm. tlon of the policy of this government to secure tho co-ODeratlon of the Inter. cstod nations, tho United States pro posed an international opium confer ence with full powers for tho purpose of clothing with tho force of interna tional law the 'resolutions adopted by the above-mentioned commission, to- eethor with their nnsentitil cnrnllnrtnn The othor powers concerned cordially responded to tho proposal ot this gov ernment, and. T am triad to hn' nhla tn announce, representatives ot all the powors assembled in conference at Tho Hague on the first ot this month. Since the passage of the opium-exclusion act, moro than twenty states havo been animated to modify their nharmacv laws and lirlnur thmri In an. cord with tho spirit ot that act, thus stamping out, to a measure, the in trnatntn trnflln In onlum and nthar habit-forming drugs. But, although I have urgod on tno congress the pass ago of certain measures for federal control of tho interstate and foreign traffic in these drugs, no action has yet ooon inKen. in viow or tho fact that thero Is now stttlntr at The Hneiia so important a conference, which has under reviow tno municipal laws of the different nations for tho mttlrntlnn of their opium and other allied ovlls, a conference wnicn win certainly deal with the international aspects ot these evlla." it seems to me moat oscantlat that the congress should take Immedi ate actloa on tho aati-narcotlo legisla tion tn which I have already callad at. tentloa by a special message. Foreign Trade Relatione ef the United States. In my last annual message I re ferred to the tariff negotiations of the department ot stato with foreign coun tries In connection with the applica tion, by a series of proclamations, of the minimum tariff ot the United States to importations from the sev eral countries, and I stated that, In its general operation, section 2 of the now tariff law bad proved a guaranty ot continued commercial peace, al though there were, unfortunately, In stances, where foreign governments dealt arbitrarily with Amerlcaa Inter ests within their Jurisdiction la a manner injurious and inequitable. During the past year some Instance of discriminatory treatment have beea. removed, but I regret to say that there remain a few Cases ot differential treatment adverse to the commerce e the United States. While aoae ef these Instances bow' appears to amoaat . to undue discrimination la the seaee of section 2 ot the tariff law of Aagast' C, 1909, they are all exceptions to that, complete degree ot equality ot tariff treatment that the department ot etate has consistently sought to obtain far American commerce abroad. While the double tariff feature et the tariff law ot 190 has beea assply Justified by the results achieved la re- . moving termer aad preveatiae; new, -; -uadae diserimlaatloaa against AmerU wuarautw, t w la unnvn in a t Kin a a ume MS coma ror tun aniaiiMt or . this feature of the law in Buch way aa v to provide a graduated mean of meet- -' lng varying degrees ot discriminatory : 1 . . . . . n TOiiuout ai American commerce ib,w fOrafw rnnnMaa aa wall aa In tect the financial Interests abroad ot, Amerlcaa citizens against arbitrary y and injurious treatment on the part ot " ' foreign governments through either legislative or administrative measures. It would also seem desirable that . the maximum tariff of the United'' States should embrace within Its pur view the free list, which is not the case at the present time, in order that it might have reasonable significance to tho governments of thoso countries from which the importations lato the united states are confined virtually ta n.H.tnfl n 11.- . ,1.1 i uu wo iree nut, Tho fiscal year ended June 30, 1911, showB great progress In tha dovolop- -mont of American trade. It was note- . worthy as marking the hlahest record of exports of American products tc ioreign countries, the valuation being In excess of $2,000,000,000. Those ox- . ports showed, a aaln over thn urnr.nd. lng year of moro than $300,000,000. inere is widespread appreciation ex- , pressed by the buslnese Interests ot , .. the country as regards tho nraetleal " value of the facllltlea now offered by" tne department of stato. and the do- ' partmont of commerce and labor for . the furtherance of American com- 2 merce. Crying Need for American Merchant Marine. I need hardly reiterate the convlc-. tlon that there should speedily ha built up an American merchant ma rine. This is nocessary to annum tl. vorablo transportation facilities to our great ocean-borne commerce as Wel as to supplement the navy with an - adequate reserve of ships and mefa. it would nave the economic advantage of kceplug at homo part of tho vaBt Bums now paid forelan shlnnlne for carrying American goods. All the" great commercial nations pay heavy subsidies to their merchant marine, bo' that it is obvious that without soma wise aid from tho Congress the United ' atates muBt lag behind In the matter . of merchant marina In Its presont anomalous position. Legislation to facllttata tha Avtan. . elnn A m a . I .. n I. , i . . i-ituc. iiitu uuunb io ioreign countries Is another matter In which our foreign trade needs assistance. Improvement of the Forelfjn 8ervlce. The entire forelgu-servlce organiza tion Is being Improved and developed with especial regard to the require ments of the commercial Interests ot the country. The rapid growth of our foreign trado makes It of the utmost Importance that governmental agen cies through which that trade Is to be aided and protected should possess a high degree ot efficiency. Mot only should the foreign representatives be maintained upon a generous scale in - so far as salaries and establishments are concerned, but the selection and advancement ot officers should he defi nitely and permanently regulated by, law, so that tho sorvlco shall not fall to attract men ot high character and ability Tbo experienco ot tho past few years, with a .partial application of civil service rules to the dlpiomatlo and consular service loaves no doubt in my mind ot tho wisdom of a wider and moro permanent extension of those principles to both branches ot .the foreign service. The men selected ' for appointment by means of the ex isting executive regulations have been of a far higher average of Intelligence and ability than the men appointed before the regulations -were promul gated. I therefore again commend to the favorable action ot the congress the enactment or a law applying to the diplomatic and consular service the principles embodied In section 17E3 ot the Rovlsed Statutes ot tho United States, in tho civil service act of Jan uary 1G. 1883. and tho executive orders of June 27, 190G, and ot November 28, 1909. in its conaiqoratlon ot this Im portant aubjoct I desire to recall to tbe attention ot tho congress the vary favorable report made on the Lowden bill for the Improvement of the foreign service by the forelan affairs commit. tee ot the hoase ot representatives. Available statistics show the strict sees with which the merit system haa been applied to the foreign hbi-vIcoj during recent years and the absolute non-partisan selection of consuls and dlpiomatlo service secretaries who in. deed far from being selected with any view to political consideration have actually been choson to a dispropor tionate extent from states which would. have beon unrepresented in the for eign service undor the system which it IS to be hOPCd is now nennannntlv obsolote. Some legislation for tbe per petuation or tno present system ot ex aminations and promotions upon mer it and efficiency would bo of crrentent value to our commercial and Interna tional jnterosts. WM. H. TAFT.