MESSAE R.EAD TV CONGRESS No Tariff Revision For the Present. NICARAGUAN TROU7E, Irresponsible Nations Not Pro tected by Monroe Doctri.e. A DEFICIT OF $73,075,6010 legislation Urged Against In. junctions Without Notice. Washington, Dec. 7.-In his annual message, read to congress. President Taft said: To the Senate and the House of Rep resentatives: The relations of the United States with all foreign governments have con tinued upon the normal basis of amity and good understanding and are ver. generally satisfactory. Europe. The American rights [in the fisheries on the north Atlantic coast] under the fisheries article of the treaty of I81S have been a cause of difference be tween the United States and Great Britain for nearly seventy years. The interests involved are, of great impor tance to the American fishing industry-. and the final settlement of the contro v-ersy [by the permanent court of ar bitration at The Haguel will remove a source of constant irritation and com-. plaint. This is the first case involvingm such great international questions which has been submitted to the per manent court of arbitration at' The Hague.. SNegotiations for an international conference to consider and reach an arrangement providing for the preser vation and protection of the fur seals in the north Pacific are in progress -with t lie governments of Great Britain, Japan and Russia. The attitude of the governments interested leads me to hope for a satisfactory settlement of this question as the ultimate outcome of the negotiations. The Near East. The quick transition of the govern ment of the Ottoman empire from one of retrograde tendencies to a consti tutional government wvith a parlia .ment and with progressive modern policies of reform and public improve ment is one of the important phenome na of our times. Constitutional gov ernment seems also to have made further advance in Persia. These events have turned the eyes of the world upon the niear east. in that quarter the prestige of the United states has spread widely through the peaceful intluence of American schools, universities and missionaries. There is every reason why we should obtain a greater share of the commerce of the Dear- east since the conditions are more. favorable now than ever before. Latin America. One of the happiest events in recent pan-American diplomacy was the pa citic, inidependent set tlement by the governments of lBolivia and Peru of a bo)undaJry difference between them.. which for some weeks thlreatened to cause war and eveni to entrain im bitterments affecting other rep)ubile~s less directly concerned. Our Citizens Abroad.' This administration, through the de partment of state and the foreign serv ice, is lending all proper support to 2egitimate and beneficial American en -terprises in foreign countries, the de -gree of such support being measured by the national advantages to be ex-' -pected. A citizen himself cannot' by' -contract or otherwise divest himself of the right, nor can 'this government ~scape the obligation, of his protec tion in his personal and property -ights when these are unjustly in 'frin'ged in a foreign country. To avoid ceaseless vexations it is proper that in considering whether American enter prise should be encouraged or support 'ed in a particular country the govern ment should glve full weight not only Ito the 'national as opposed to the indi 'iduial benefits to accrue,' but also to the fact wihether or not the govern ment of the country in question is in its administration and in its diplomacy faithful to the principles of modera tion, equity and justice upon which alone depends international credit in diplomacy as well as in finance. The Monroe Doctrine. The pan-American policy of this government has long been fixed in its principles and remains unchanged. ~With the changed circumstances of the Utnited States and of the republics to the south of us, most of which have great natural resources, stable govern men and progressive ideals, the ap prehension which gave rise to the Monroe doctrine may be said to have nearly disappeared. and t-ither the doctrine as it exists nor any other doc trine of American p>licy should be permitted to operate for the perpetua tion of irrespousible gover:mnc4t. t escape of just oligatic-ns or t1le insidi ous allegation of uomiinatig ambitions on the part of the United StaLes. My meeting with President Diaz and the greeting exchanged on both Amer ican and Mexican soil served. I hope. to signalize the close and cordial reia tions which so well bind toget her 1I. republic and the great republi imme diately to the south, between whichi there is so vast a network of material interests. I aui happy to say that oll but one of the cases which for so lon- vextu our relations with Venezuela have been settled within the past few months and that. under the enlight ened regime now directing the govern ment (if Vene::nel. provision has h made for ariA tra Ciou (f tle rt-:101 -.i ! case before The Hague tribun:l. On July 30, 1109, the government of Panama agreed. after considerable ne gotiation. to indemnify the relatives of the American olficers and sailors who., were brutally tlreated. one of thei: having. ideed. I;xen killed by the Panaman police this year. This government was obliged to In-: tervene diplomatically to bring about arbitration or settlement of the claim of the Emery company against Nica ragua. which it had long before been agreed should be arbitrated. A settle ment of this troublesome case was reached by the signature of a protocol on Sept. 18, 1909. *Many years ago diplomatie interven tion became necessary to the protof tion of the interests in the American claim of Alsop & Co. against the government of Chile. The govern ment of Chile had frequently admitted obligation in the case and had prom ised this government to settle it. There had been two abortive attempts to do so through arbitral commissions, which failed through lack of jurisdiction. Now, happily, as the result of the re cent diplomatic negotiations, ihe gov ernments of the United States and of Chile, actuated by the sincere desire to free from :ny strain those cordia! and friendly relations upon whi-h both set such store. have agreed by a proto col to submit the controversy to defll Itive settlement by his Britannic ma jes ty Edward VII. The Nicaraguan Trouble. Since the Washington conventions of 1907 were communicated to the gov erunent of the United States as a con suting and advising party this got enent has been almost continuously called upon by one or another and in turn by all of the five Central Amner kan republics to exert itself for the maintenance of the conventions. Nea ly every complaint has been against the Zelaya government of Nicaragua. which has kept Central A merica in constant tension or turmoil. The re sponses made to tihe representationls of Central American repuiblies as due from the United States on account ~of its r-elation to the Washington c-onven tions have been at all times consen~ a tive and have avoided, so far as possi ble, any semblance of Iiterference. al though it is very appareult that the consideration]s of geographic proxi mity to the canal zone and of the very sub stantial A mericani interests in Central America give to the United States a special position in the zone of these~ republics and the Caribbean sea. I need not rehearse here the 'patient efforts of this government to pr-omote peace and welfare among these re publics, efforts which are fully appre cia ted by the majority of them who are loyal to their true interests. It would 'be no less unnecessary to re hearse here the sad tale of -unspeak able barbarities and oppression alleged to have been committed by .the Zelaya government. Recently two Amecricans were put to death by order of Presi - dent Zelaya himself. They were ofii cers In the organized forces qf a rev olution which had continued many weeks and was in control of about half of the republic, and as such, n cording to tne modern enlightened practice of civilized nations, they were entitled to be dealt with as prisoners f war. At the date when this message i. p)rinted this government has term!i nated diplomatic relations with the Zelaya government for reasons made public in a comniunicationl to the for me- Nicaraguan charge d'affaires and is intending to take such futur-e steps1 as may be found most consistent with its dignity, its duty to American in terests and its moral obligations to Central America and to civilization. It may later be necessary for me to bring this subject to the attention of thel congress In a special message. In the Far East. In the far east this government pre serves unchanged its policy of support ing the principle of equality of oppo tunity and scrupulous respect for the integrity of the Chinese empire, to which policy are pledged the interest1 ed powers of both east and west. By the treaty of 1903 China has un-, dertaken the abolition of likin with a moderate and proportionate raising of the customs tariff along with currency reform. These reforms beIng a mani fest advantage to foreign commerce as well as to the interests of China, this government is endeavoring to facili tate these measures and the needful acquiescence -of the treaty powers. When it appeared that Chinese likin revenues were to be hypotheeated to foreign bankers In connection with a great railway p)roject it was obvious that the governments whose nationals held this loan would have a certain direct interest in the (!uestion of the carrying out by China of tihe reforms in question. The administration deem ed American participation to be of gr+esatnini Interet Innily. when It was as a matter of broad poli-3 ur gent that this opportuiy should ui be lost. the indispensable i;mnu.. ity presented itself win a grouip C American baiOrs of internati;.a! reputation and great Irnre1agr1:: at once to shore in the 11:,1: u 1 i cisely such terms 1 I1tis ver:. - should approve. The chief of tl;se terms was that .\merie:mk raihvy m terial should be upon mn exac equality with that of the other nationals join ing in the loan in the plaving of or ders for this whole railroad system. After months of negotiation the eciual participation of Americans seems :it last assured. In one of the Chinese-Japanese ezrn ventions of Sept. I of this year there was a provision which causvled co;:id erable public apprehesion, in thz: upon its face it was believed in some quarters to seek to establish at monop oly of mining privileges along the South Manchurian and Atun;r--\uk den railroads and tius x !l,I, Americans from a wide Ie-l o -- prise, to'take part in whl!ich they wi by treaty with China entitled. After a thorough examinatiol of the conven tious and of the several contextual documents the secretary of state reach ed the conclusion that no stich monol) oly was intended or accomplished. This government made inquiry of the iruperial Chinese and Japanese gVv ernments and received from each offi cial assurance that the provision had no purpose incon-istent with the poli cy of equality of opportunity to which the signatories, In common with the United States. are pledged. Our traditional relations with the Japanese empire continue cordial. as usual. The arrangement of 190; for a co-operative control of the coin1g of laborers to the United .States has proved to work satisfactorily. The matter of a revision of the existing treaty between the United States and Japan ivhich is terminable in 1912 is already receiving the study of both countries. The Department of State. 1 earnestly recommend to the favor able action of the co1ngress the est mates submitted by the department of state and most especially he legis:i tion suggested in the secretary of state's letter of this date whereby it will be possible to develop anud make permanent the reorganizativit of the department upon modern lines in a manner to make it a tloroughly ef ficient instrument in the furtherance of our foreign trade and of American interests abroad. Under a provision of the act of Aug. 5, 1909, 1 have appointed three offlcials to assist the ofdic3rs of the government in collecting inJformaition necessary to a wise administrationi of the tariff' act of Aug. 5, 1909. As to questions of customs administratIOn they are co operating with the offieials of the treasury department and as to matters of the needs and the exigencies of our manufacturers and exporters with- t he department of commerce and labor in its relation to the domestic aspect of the subject of foreigu commerce. As a consequence of section 2 of the tariff act of Aug. 5, 1909. it ho'comies t he duty of the secretary of state to con duct as diplomatic b)usiiess tall the negotiations nIecessary to place him In a position to advise ime as to w 1et hen or not a partic-ular counltrty nnduLe dis criminates aiga inst thme Uniit ed St ates~ in the sense of thle stai tute referred to. Government Expenditures and Rev enues. Pehtaps the most important .I.0 th:tn the totl of approplinDions flr Ci,e cu.rren:.~ s. :,ea and iie l ess h. .U ( t;,:I:i thc esi a flna, 11 i* ..Lt year. So a Is th sere>':v of the treasury is .bl:e to forl ju. iiin as to future income, there will be no deficit in the year endln-; June 30. 1.;11. but n small surplus of $712.0.:0. Inl the preselt estiates tle needs of the departIeIts and of the gov ernmet lve beon cut t the quick. For the purpuse Of securing infrila tion which may enable the executive and the lcgia:: :nhes to uni:. I inl a planl fi)r the perllailent redul I ,i the cost of governmental adnins tration the treasury department has lnstituted an investigation by one of the most skilled expert accountants in the United States. The object of ' invest ig q ion is to devise means tJo e I - Crease the a-Norige villicency of c-:i1 employee. There is !re::t rusor I :! - provement toward this end. I-OLtB:. by the reorganizaticn of bureaus and depr1,tments and in the avolda-ce of dupliention. but also in the treatient of the individual employee. Under the present system it constant ly happeas that two etuployees receive the same salary when the work of one is far more difficult and important and e:wun!g than that of the other. Su perior ability is not rewarded or en eou ra-ed. Civil Pensions. As the degree. of efficiency in all the departments is much lessened by the re tention of old employees who have out lived their energy and usefulness it is Indispensable to any proper system of economy that provision be made so that their separation from the service shall be ensy and inevitable. It is im I possible to make such provision unless there is adopted a plan of civil pen sions. We cannot. in view of the ad vancing prices of'living. hope to save money by a reduction in the standard of salaries paid. Indeed, if any change is made in that regard an increase rather than a decrease will be neces sary. and the only means of economy will be in reducing the number of employees and in obtaining a greater average of etliciency from those re tained in the service. Frauds In the Collection of Customs. I regret to refer to the fact of the discovery of extensive frauds in ihe collection of the customs revenue at New York city, in which a number of the subordinate employees in the weighing and other departments were directly concerned and in which the beneficiaries were the American Sugar Refining company .and others. .The frauds consisted in the payment of du ty on underweights of sugar. The gov ernment has recovered from the Amer ican Sugar Refining company all that it is shown to have been defrauded of. The sum was received in full of the~ amount due which might have been recovered by civil action against the beneficiary of the fraud, but there was an~ excess reservation in the contract of settfement by which the settlement should not interfere with or prevent Ithe criminal prosecution of every one who was found to be subject to the same. Criminal prosecutions are now pro ceeding against a number of the gov ernenit officers. The treasury de prtment and the department of jus tie are exerting every effort to dis cover all t he wvrongde-ers. including t he oie.rs and employees of the compa nies who may have been prIvy to the fraud. It would seem to me that an investigation of the frauds by conl gress at present, pending the probing by the tre'asury department and the department of justice, as proposed. might by giving immunity and other wise prove an embarrassment in se uring convictIon of the guilty parties. Maximum and Minimum Clause In Tarif' Act. Two features of the new tariff act call for special reference. In order that the matxi mum duty shall be charg ed against the imnports from a country it Is necessary that the executive shall find ou the' p:art of that country not only discrimuinations i:i its laws or the practice uinder t hem angainst the trade of the United States, but thait the dis rinations found shl~l be undue tht is. wit hout good and fair reaso'c. No one is seeking a tariff war or a een dition in which t he splirit of rCtaliaion)1 shall be aroused. Tar-n Readjust;at. Thue newv tariff law enables me to alp point a tariff bojird to assist me in (e-o:I nection with the depar-tmenlt of state in the administration) of the minimum and maximuml clause of the act and also to assist officeers of the g-overnmenlt in the administration of the entire Inw. I be ieve that the work of this, board will be of prime utility and importance whenever congress shall deem it wise again to readjust the customs duties. If the facts secured by the tariff board are of such a character as to show gen erally that the rates of duties imposed by the present tariff law are excessive Iunder the p)rinciples of protection as described in the platform 'f the suc cessful pcarty at the late election I shall not hesitate to invite the atten tion of congress to this fact and to the necessity for action predicated there on. Nothing, however, halts business and interferes with the course of pros perity so much as the threa iened revi sion of the tariff, and until the facts are at hand, after careful and deliber ate investig:ation, upon which such re viincn pr-opely bie undertaken, it seems to 1un u:nwise to attemit it. War Department. In tile interest of immediate econ amv I have required a reductionl in e e: m"s of the war department - the coming fiscal year which -ings the total estimates down to an . .-un fotyfie millions less than ,he corresponding estimates for last rear. This could be accomplished only 5y cutting off new projects and sus pending for the period of one year :i progress in military ialt--rs. Fwr ti. ame reason I have directed lii.t i irmy shall not be recruilod u. V) i' present authorizcdL s:.gth. The: measures can l ! ! e aeh temporary, for I :.ml sure that t: i:: terests of the military establisim-.it are seriously in need of careful con sideration by congress. The secretary of war calls attention to a number of needed chan.nes in tiie rmy. in all of whih I conc:ur. but tle point upon which I place most e:n phasis is the need for an eliminati-n bill providing a method by which the merits of officers shall have some ef feet upon their adanceient and by which the advancement of all may be accelerated by the effective elimination of a definite proportion of the least efficient. The military and naval joint btiord. Lave unanimously agreed Chat it would be unwise to make the large expendi tures which at one time were contem plated in the establishment of a naval base and station in the Philippine Is lands and have expressed their judg ment, in which I fully concur. in fa vor of making an extensive naval base at Pearl Harbor. near Honolulu, and not in the Philippines. The Navy. The return of the battleship fleet from Its voyage around the world in more efficient condition than when it started was a noteworthy event of in terest alike to dur citizens and the naval authorities of the world. The marked success of the ships in steam ing around the world in all weatUt-rs on schedule time has increased respect for our navy and has added to our na tional prestige. It is a regrettable fact that the higher officers are old for the respon sibilities of the modern navy, and the admirals do not arrive at flag rank young enough to obtain adequate train ing in their duties as flag oticers. Owing to the nece.wity for economy in expenditures. I have directed I 'e curtailment of recommendations for naval appropriations so that they are thirty-eight millions lvss than the cor responding estimates of last year. and the request for new naval construction is limited to two first class haui iles;ips and one repair vessel. The secretary of the navy has inau gurated a tentative plan invoh-ing (er tain changes in the organizalion of the navy department, including the nivy yards, all of which have been found by the attorney general to be in ac cordance with law. I have approved the execution of the plan proposed be cause of the greater efficiency and economy It promises. Department of Justice-Expedition In Legal Procedure. The deplorable delays ini the admin istration of civil and criminaf la w have received the attention of committees of the American Bar association and of many state bar associations as well as the considered thought of judges and jurists. In my judgment, a change in public procedure. with a view to re ducing its expense to private litigants in civil cases and facilitating the dis patch of business and final decision in both .civil and criminal cases, consti tutes the greatest need in our Ameri can institutions. I do not doubt for one nmoment that much of the lawless violence and cruelty exhibited in lynch ings are directly due to the uncertain ties and injustice growing out of the delays in trials, judgments and t he exe cutions thereof by our-courts. I therefore recommend legislation providing for the appointment by the president of a commission with author ity to examine the law and equity procedure of the federal courts of first instance, the law of appeals frunm those courts to the courts of appeals and to the supreme court and the costs imposed in such procedure upon the prvate litigants and up)on the public treasury and make recommendation with a view to simplifying and ex pediting the procedure as far as pos sible and making it as inexpensive as may be to the litigant of little means. The platform of the successful party in the last election contained the fol lowing: Injunctions Without Notice. "We believe that the rules df p)roce dure in the federal courts with respect to the Issuance of the writ of injune tion should be more accurately defined by statute and that no injunction or temporary restraining order should beI issued without notice. except where irreparable injury would result from delay. in- which ense a1 speedy hearin: thereafter should be grantPd." I recommend that in compliance with. the promise thus made appropriate leg slation be adopted. Moreover,. every such. injunction or restraining order issued without previous notice and op portunity by tbe defendant to be beard should by force of the %tatute expire and be of no efrect after seven days from the issuance thereof or within any time less than that period which' the court may fix uinIess within such seven days or such less period the in junction or order is extended or re newed after previous notica and op portunity to be beard. Anti-trust and Interstate Commerce Laws. The jurisdiction of' the general gov ernet over int'irstate commerce has led to the passage of the so ce fled "Sherman anti-trust law" and the "In terstate commerce law" and its amendments. The developments in the operation of those laws call for a dis cussion and some suggestions as to amendments. These I prefer to em body in a special mzessage. Postofice Department - Second Class Mail Matter. The deficit every- year in the post offic deparment s largely caused by rle low ratt of Post.',e Ot i cent pound charged on -econd auss ma matter, which includes not only new papers, but nint:zitnes and iniscella ieous period ir-a: . T1 1e t uail hiss grow ing out ol tho transmissitin of Ihis econd cla; m..i! matter at Ient a [)ound m1 niilts t ( nht Pun t$1,Oi.h)0 a ear. Tlie average (st of the trans portation of this matter is irore tha D cents a pound. The statisties of 190 show that second class riail matter constituted Wo.91 per ce:t of the weihlz f all the mail a-id yielded only 5.19 per cent of the r.-venue. The figures given are startling and show the payment by iie government of an enormous subidy to the news papers. magazines a.id periodicals. A great saving might be made. ainount ing to much wore th tm llf of the Ioss. by imposing upotn magazine: and peri odicals a higher rat.- of postage. Po:t. SavaZs Sanks. 1 .vQ i:;. .. samg. bOankIs to be d o ba-nl:ing-"4 f::61141ties :,d to . - stm-*ni wvc-ald 4fer an hae-umnulation of - ~ ~ . --I i% funs-stsatory i sound principle -: :-t--sful trial in nearly all 1!1(. com:rios -.f 1ie world. for the y:. "o gVrltment guaraity of de o, w beig tidon btend i,svveral. we:ei; 4t.it which. with deference to tho who r:ocate it. seems to me to h:ve in it flih seeds of demitraliza tion to conservative banking and cer tain financial disaster. Ship Subsidy. .Following the course of my distin guished predecessor, I earnestly rec ommend to congress the consideration and passage of a ship subsidy bill. Interior Department-New Mexico and Arizona. The successful party in the last elec tion in its national platform declared in favor of the admission as separate states of New - Mexico and Arizona, and recommend that legislation ap propr.ate to this end be adopted. Alaska. With respect to the territory of Alas ga, I recowiendl legislation which shall provide for the. appointment by the president of a governor and also of an executive council, the members. of which shall during their 'term of office reside in the territory and which shall have legislative powers sufficient to enable it to give to the territory lo cal laws adapted to its present growth. I strongly deprecate legislation looking to the election of a territorial legisla ture in that vast district. Conservation of Natural .Resources. In several oepartments there Is pre sented the necessity for legislation looking to the further conservation of our national resources, and the sfl fet is one of such importance as tt require a more detailed and extended discussion than can be entered upon in this communication. For- that 'rea son. I shall take an early opportunity to send a special message to congress. The White Slave Trade. ,There is urgent necessity for addi tional legisiation and greater executive activity to suppre'ss the recruiting of the ranks of p)rostitutes from the streams of imlimigration into thmis '' cou try-an evil wvhich, for want' of -a b et ter name, has b)eenr called '7the white slave trade." 'Bureau of H eaithr There seemis to be no reason) wh: all the bu.reaus amnd offices in the geia-ral government which have to don witth the publie health .or subjects ain thereto should not be -united in a bu reau to be called the "bureau of pub lie health." Political Contributions I urgently recommend to congressI that a law be passed requirig that candidates in elections of membwrs of the house of r-'presenmtatives and com mittees in: charge of t.heirs candidacy and campaign file in a proper office of the United States government a state ment of the contributions received and . of the expenditures incurred .In the campaign for such elections and that similar legislation be enacted in re spet to all other elections which are constitutionally within the control of' congres. Conclusion. Speaking generally. the country Is in a. high state of prosperity. "There is every reason to believe that we are on the eve of a substantial business ex panslon. and we have just garnered a harvest unexampled in the market val ne of our agricultural products. -The h1gb prices which such pr'oducts' bring mean great p)rosperity for the farming community; but, on the other hand, they mean a very considerably increas ed burden upon those classes in the coumnnity whose yearly 'omipensatica does not.expand with the improvement In business and the general prosper'it. Various reasons are given for the high prices. -The proportionate increase in -the output of gold, which today Is the -- chief medium of exchauge and is in some respects a measure of value, fur nishes a substantial explanation of at least part of the increase in prices. The increase in population and the more expensive mode of living of the people, which have not been accom panied by a proportionate increase,,nf acreage production, may furnish a -fur ther reason. It is well to '.ote that the increase in the cost of living is not --- confied to this country, but p)revails the world over, and that those who would charge increases In prices to the existing protective tariff must meet the fact that the rise in prices has taken place almost wholly. in those rodcts of the factory and farm in resect to v;hichi thero has been either no increase in the tariff or in many Instances a very considerable reduc tion.