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READ TO CONGRESS MAKES MANY IMPORTANT REC OMMENDATIONS TO CONGRESS. WILSON WARNS REDS FINANCIAL SYSTEM MUST BE CHANGED, SAYS THE PRESIDENT. W«M»<ern N*wi*paper l.'nlon N<*w* Service M ho President's message to Congress M’uesdny follows: f Tn Iho Somite ami House of Repre sentatives : t sincerely regret that I cannot be present at the opening of this session of the Congress. I am tints prevented from presenting In as direct away ns I could wish the many questions that are pressing for solution at. this time. Happily, I have had the advantage of the advice of the heads of the several executive departments who have kept in close touch with affairs in their de tail and whose thoughtful recommend ntlons ! earnestly second. In the matter of the railroads and the readjustment of their affairs grow ing out of federal control, I shall take the liberty at a later day of address ing you. Urges National Budget. t hope that Congress will bring to a conclusion at this session legislation looking to the establishment of a bud get system. That there should lie one siugei authority responsible for the making of all appropriations and that nppropriutlons should he made not In dependently of each other, hut with reference to one single comprehensive plan of expenditure properly related to the nation’s income, there can he no doubt. I believe the burden of prepar ing the budget must. In the nature of the case, If the work is to he properly done and responsibility concentrated instead of divided, rest upon the execii utirc. The budget so prepared should l>e submitted to and approved or amend ed by a single committee of each house of Congress and no single appropria tion should he made by the Congress, except such as may have been includ cd in the hrnlgst prepared by the ex ecutive of added by the particular com mlttee of Congress charged with the budget legislation. Permanent Tenure of Office. Another and not less Important a*i>ect of the problem is the ascertain ment of the economy and efficiency with which the moneys appropriated are expended. Under existing law the only audit Is for the purpose of ascertaining whether expenditures have been lawfully made within the appropriations. No .one is authorised »»r equipped to ascertain whether the money has been spent wisely, econom ically mid effectively. * The auditors should he highly 4 rallied officials with permanent ten ure in the Treasury Department, free of obligations to or motives of consid eration for this or any subsequent ad ministration and authorized aud em powered to examine Into and make re port upon the methods employed and Uiu results obtained by the executive departments of the government. Their 4*c|hm*(m should be made to the Con gress and to the secretary of the treasury. I trust that the Congress will give its Immediate consideration to the problem of future taxation. Simpli fication of the income and profits taxes has become an immediate neces sity. These taxes performed Indispen sable service during the war. They must, however, be simplified, not only to save the taxpayer inconvenience and expense, but in order that his lia bility may he made certain and defi nite. Questions of Tax In Peace Time. With reference to the details of the ieventie law, the secretary of the treasury and the commissioner of in ternal revenue will lay before you for your consideration certain amend monts necessary or desirable in con nection with the administration of the taw —recommendations which have my upprovui and support. It is of the utmost imimrtance that in dealing with this matter the pres ent law should not he disturbed so far as regards taxi's for the calendar year lirJO, payable in the culeudur year 1921. The Congress might well consider whether the higher rates of Income and profits taxes cun In peace times be effectively productive of revenue and whether they may not, on the con trary, be destructive of business ac tivity and productive of waste and in efficiency. There is a point at which in peace times ulgli rates of Income and prof its taxes discourage energy, remove Hie Incentive to new enterprise, en courage extravagant expenditures and produce Industrial stagnation with consequent unemployment and other attendant evils. America’s Position. The problem Is not an easy one. A fundamental change lias taken place with reference to the position of Amer ica in the world’s affairs. The preju dice and passions engendered by dec ades of controversy between two schools of political and economic thought—the one believes in protec tion of American industries, the other believes in tariff for revenue only— must be subordinated to the single consideration of the public Interest in the light of utterly chuugcd condi tions. Before the war America was heavily the debtor of the rest of the world, and the interest payments she had to make to foreign countries on Ameri can securities held abroad, the expen ditures of tlie American travelers uhroad and the ocean freight charges she had to pay to others, about bal anced the value of her pre-war favor able balance of trade. During the war America’s exports have been greatly stimulated, and increased prices have increased their value. On the other hand, she has pur chased a large proportion of the Amer ican securities previously held übroad, has loaned some $'J,000,000,000 to for eign governments, and has built her own ships. Our favorable balance of trade has thus been greatly increased and Eurom* has been deprived of the means of meeting it heretofore exist ing. To Develop Market. Europe cun have only three ways of meeting the favorable balance of trade In peuee times: By imports into this country of gold or of goods, or by establishing new credits. Europe Is in no position at the present time to ship gold to us nor could we contem plate large further Imports of gold into this country without concern. The time has nearly passed for In ternational government loans nml it will lake time to develop in this coun try a market for foreign securities. Anything, therefore, which would teiid to prevent foreign countries from set tling for our exports by shipments of goods Into this country could only have the effect of preventing them from paying for our exports and therefore of preventing the exports from being made. The productivity of the country, greatly stimulated by the war, must find an outlet by exports to foreign countries and any measures tuken to prevent imports will Inevitably curtail exports, force curtailment of produc tion, load the banking machinery of the country with credits to carry un sold products ami produce industrial stagnation and unemployment. If we want to sell, we must be prepared to buy. America Greatest Capitalist in World. Whatever, therefore, may have been our views during the period of growth of American business concerning tar iff legislation, we must now adjust our own economic life to a changed condition growing out of the fact that American business is full grown and that America is the greatest capitalist in Hie world. No policy of Isolation will satisfy the growing needs and opportunities of America. The provincial standards and policies of the past, which have held American business as if in a straiglitjucket, must yield and give way to the needs anil exigencies of the new day In which we live, a day full of hope and promise for Ameri can business, if we will hut take ad vantage of the opportunities that are ours for the asking. The recent war lias ended our Iso lation nml thrown upon us a great duty and responsibility. The United States must share the expanding world market. The United Stutes desires for itself only equal opportunity with the other nations of the world, and the process of friendlq co operation and foreign competition so the legit imate interests of ail nations concerned may be successfully and equitably ad justed. Must Give Relief to Returned YanKS. There tire other matters of import ance upon which I urged action at the last session of Congress which are stil pressing for solution. I am sure It is not necessary for me again to remind you that there is one immediate and very practicable question resulting from the wur which we should meet in the most liberal spirit. It is a mat ter of recognition and relief to our sol diers. I can do no better than to quote from my last message urging this very action: “We must see to It that our return ing soldiers are assisted in every prac ticable way to find tlie places for which they are fitted in the daily work of the country. This can he done by developing and maintaining upon an adequate scale the admirable organiza tion created by the Department of La hor for plncing men seeking work; and it can also !>e done, in at least one very great field, by creating new opportunities for individual enterprise. Urges Support for Secretary's Plans. “The secretary of the Interior has pointed out the way* In which return ing soldiers may be helped to fund anil take up land In the hitherto un developed regions of the country which the federal government already has prepared or can readily prepare for cultivation and also on many of the cutover or neglected areas which 11c within the limits of the older states: and I once more take the liberty of recommending very urgently that his plans shall receive the immediate and substantial support of Congress.” In the matter of tariff legislation, 1 beg to call your attention to the state ments contained In my last message urging legislation with reference to the establishment of the chemical and dyestuffs Industry In America: Dependence Interrupted Trade. “Among the industries to which spe cial consideration should be given Is that of the manufacture of dyestuffs and related chemicals. Our entire de pendence upon German supplies before the war made the Interruption of trade a cause for exceptional economic dis turbance. The close relation between the manufacture of dyestuff, on the one hand, and of explosives and poi sonous gases on the other, moreover, has given the industry an exceptional significance and value. “Although the United States will gladly and unhesitatingly Join in the program of International disarmament, it will, nevertheless, he a policy of ob vious prudence to make certain of the maintenance of niuny strong and well equipped chemical plants. The German chemical industry, with which we will he brought into competition, was, and may well he again, a thoroughly knit monopoly capable of exercising a com petition of a peculiarly insidious and dangerous kiud.” During the war the farmer per formed a vital and willing service to the nation. By materially Increasing the production of his land he supplied America and the allies with the in creased amounts of food to keep their immense armies In the field. He indispensably helped to win the war. But there is now scarcely less needs of increasing the production in food and the necessaries of life. ( ask the Congress to consider means of en couraging effort along these lines. Gives Boost for Bettor Roads. Th«* of doing everything jiossl ble to promote production along eco nomical lines, to improve marketing and to make rural life more attractive and healthful, is obvious. I would urge approval of the plans already proposed to the Congress by the secretary of ag riculture, to secure the essentiul facts required for the study of this ques tion, through the proposed enlarged programs for farm management stud ies and crop and estimates. I would urge, also, the continuance of federal participation in the building of good roads, under the terms of ex isting law and under the direction of present agencies; the need of further action on the part of states and thf federal government to preserve and develop our forest reservolrc and sup ply through the practice of better forestry methods on private holdings and the extension of the publicly owned forests; better support for country schools and the more definite direction of their courses of study along the lines related to rural prob lems; and fuller provision for sanita tion in rural districts and the build ing up of needed hospital and medical facilities In these localities. Political Restlessness. Perhaps the way might be cleared for many of these desirable reforms by a fresh, comprehensive survey made of rural conditions by a conference com posed of representatives of the farm ers and of the agricultural agencies re sponsible for leadership. I would call your attention to the widespread condition of political rest lessness In our body politic. The causes of this unrest, while various and complicated, are superficial rathei than deep seated. Broadly, they arise from or ore connected with the fail ure on the part of our government to arrive speedily at n Just and perma nent peace permitting return to norma! conditions, from the transfusion of rad ical theories from seething European centers pending such delay, from heart less profiteering resulting in the in crease in the cost, of living, and, lastly, from the machinations of passionate and malevolent rgltators. With the return to normal condi tions, this unrest will rapidly disap pear. In the meantime It does much evil. It seems to me that in dealing with this sltua.'hm Congress should not he impatient or drastic, hut should seek ruther to rulin' e iuc causes. Courts Should Deal With Radicals. It should endeavor to bring our country hack speedily to a peace basis with ameliorated living conditions un der the minimum of restrictions upon personal liberty that Is consistent with our reconstruction problems. And It should arm the federal gr. verm ■•nil with power to deal in Its cri'uluul courts with those persons »vli i by vio lent methods would abrogate the time tested institutions. With the free expression of oplnlou and with the advocacy of orderly po litical change, however fundamental, then* must he no Interference, but to wards passion and malevolence tend ing to incite crime and Insurrection under guise of political evolution there should be no leniency. Legislation to this end lias been recommended by the attorney general and should be enacted. In this direct connection [ would call your attention to my recommenda tion on Aug. 8, pointing out leg’idatlve measures which would he effective In controlling and bringing down th** present cost of living, which contrib utes so largely to this unrest If ihe government’s campaign Is to no effec tive, It Is necessary that the other steps suggested should be acted upon at once. Urges Extending Food Control Act. I renew and strongly urge the esslty for the extension of the pres ent food control act as to the period •*! time In which It shall remain in opera tion. The attorney general has sub mitted a hill providing for an extern sion of this act for a period of six months. As It now stands it is limited In operation to the period of the war and beeomes inoperative upon the for mal proclamation of peace. It Is im perative that It should be extended at once. The Department of Justice has built up extensive machinery for the purpose of enforcing Its provisions; »•> of which must be abandoned upon the conclusion of peace unless the provi sions of this act are extended. During this period the Congress will have an opportunity to make atarflsi permanent provisions and regulation* with regard to all goods destined for ttth rwnmwii wworwro interstate commerce and to exclude them from Interstate shipment. If the requirements of the law are not com piled with. Some such regulation is imperative ly necessury. The abuses that have grown up in the manipulation of prices by the withholding of foodstuffs and other necessaries of life cannot other wise be effectively prevented. There cun be no doubt of either the necessity or the legitimacy of such measures. w»vic Associations Can Play Big Part. As I pointed out in my lust message, publicity can accomplish a great deal in this campaign. The alms of the government must be clearly brought to tlie attention of the consuming public, civic organizations and state officials, who ure in a position to lend their as sistance to our efforts. You have made available funds with which to carry on this campaign, but there is no provision in the law au thorizing their exi>endlture for the pur pose of making the public fully in formed about the efforts of the gov ernment. Specific roconimendatlon lias been made by the attorney general in this regard. I would strongly urge up on you its Immediate adoption, as it constitutes one of the preliminary steps to this campaign. I also renew my recommendation that the Congress pass a law regulat ing cold storage ns it is regulated, for example, by the iuws of the stute of New Jersey, which limit the time dur ing which goods may l>e kept In stor age, prescribe the method of disposing of them if kept beyond the permitted period and require that goods released from storage shall in all case bear the date of their receipt. Purchaser Would Know o Profits. It would materially add to the serv iceability of the law for the purpose we now have in view, if it were also prescribed that ail goods released from storage for interstate shipment should have plainly marked upon each pack age the selling or market price at which they went into storage. By this means the purchaser would always be able to learn what profits stood be tween him and the producer or the wholesale dealers. I would also renew my recommenda tion that all goods destined for inter state commerce should in every case, where their form or package makes it possible, he plainly marked with the price at which they left the hands of the producer. We should formulate a law requiring a federal license of all corporations en gaged in Interstate commerce and em bodying In the license, or in the condi tions under which it is to be issued, specific regulations designed to secure competitive selling and prevent uncon scionable profits in the method of mar keting. Such a law would afford a welcome opportunity to effect other much need ed reforms in the business of inter state shipment und in the methods of corporations which are engaged in it; but for the moment I confine my rec ommendations to the object Immediate ly in hand, which is to lower the cost of living. Capital and Labor Must Be Partners. No one who has observed the march of events in the last year can fail to note the absolute need of a definite program to bring about an improve ment in the condition of labor. There can be no settled conditions leading to increased production, and~u reduc tion in the cost of living if labor and capital are to be antagonistic instead of partners. Sound thinking and an honest desire to serve the interests of the whole nution, as distinguished from the Interest of a class, must be applied to thes olutiou of this great and press ing problem. The failure of other nations to con sider this matter in a vigorous way has produced bitterness and jealousies and antagonisms, the food of radical ism. The only way to keep u»en from agi rat.lng against grievances is to remove the grievances. An unwillingness even to discuss these mutters produces only dissatisfaction and gives comfort to the extreme elements in our country which endeavor to stir up disturb ances in order to provoke governments to the solution of this great and press and repression. The seed of revolution is repression. Give Workers Rights. The remedy for those things must not he ucgntlve in character. It must be constructive. It must comprelieud the general interest. The real anti dote for the unrest which manifests itself is not suppression but a deep consideration of the wrongs that beset our national life and the application of a remedy. Congress has already shown its willlnguess to deal with these indus trial wrongs by establishing the eight hour Uuy as tlte stundard in every field of labor. It has sought to find away to prevent child labor. It has served the whole country by leading the way in developing the means of preserving und safeguarding lives and health in dangerous industries. It must now help in the difficult task of finding a method that will bring about a genuine democratiza tion of industry, based upon the full recognition of the right of those who work, in whatever rank, to participate in some organic way in every decision which directly affects their welfare. It is with this purpose in mind that I called a conference to meet in Wash ington on Dec. 1, to consider these problems in all their broad aspects, with the idea of bringing about a bet ter understanding between these two Interests. Indorses World League. The great unrest throughout the world, out of which has emerged a de maud Cor an iiuuunltate cous. deration of the difficulties between capital and labor, bids us put our own house in order. Frankly, there can be no per munent and lasting settlements be tween capital and labor which do not recognize the fundamental concepts for which labor has been struggling through the years. The whole world gave its recognition and indorsement to those fundamental purposes in the League of Nations. The statesmen gathered at Ver sailles recognized the fact that world stability could not be had by reverting to industrial standards and conditions against which the average workman of the world had revolted. It is, there* fore, the task of the statesmen of this new duy of change and readjustment to recognize world conditions and to seek to bring about through legisla tion conditions that will mean the end ing of age-long antagonisms between capital and labor and that will hope fully lead to the building up of a com radeship which will result not only in greater contentment among the mass of workmen but so bring about a greater production and a greuter pros perity to business itself. Workman's Right to Live Decently. To analyze the particulars in the demands of lal>or Is to admit the jus tice of their complaint In many mat ters that He at their basis. The work man demands an adequate wage, suf ficient to jierinit him to live in com fort, unhampered by the fear of pov erty and want in his old age. He demands the right to live and the right to work amidst sanitary sur roundings, both in home und in work shop, surroundings thut develop and do not retard his own health and well being; and the right to provide for his children’s wants in the matter of health and education. In other words. It Is his desire to make the conditions of his life and the lives of those dear to him tolerable und easy to bear. The establishment of the principles regarding labor laid down in the cov enant of the League of Nations offers us the way to industrial peace and conciliation. No other road lies open to us. Not to pursue this one Is longer to invite enmities, bitterness and an tagonisms which in the end only lead to industrial and social disaster. Unwilling Workman Unprofitable. The unwilling workman Is not a profitable servant. An whose Industrial life is hedged about by hard and unjust conditions; which he did not create and over which he has no control, lacks that fine spirit of en thusiasm anti volunteer effort which are the necessary Ingredteuts of a great producing entity. Let us he frank about this solemn matter. The evidences of world-wide unrest which manifest themselves in violence throughout the world bid us pause and consider tlie means to be found to stop the spread of this contagious tiling before it saps the very vitality of the nution itself. Do w'e gain strength by withholding the remedy? Is it not the business of statesmen to treat these manifestations of unrest which meet us on every hand as evi dences of an increasing disorder and to apply constructive methods where* ever necessary, being sure that in the application of the remedy we touch not the vital issues of our industrial and economic life? There can be no recession of the tide of unrest until constructive instrumentalities are set up to stem that tide. Labor Not a Commodity. Governments must recognize the right of men collectively to bargain for humane objects that have at their base the mutual protection and wel fare of those engaged in all Indus tries. Labor must not be longer treat ed us a commodity. It must be re garded as the activity of human beings, ixjssessed of deep yearnings and desires. The business man gives his best thought to the repair and replenish ment of his machinery, so that its use fulness will not be impaired and its power to produce may always he at its height and kept in full vigor and motion. No less regard ought to be paid to the human machine, which after all propels the machinery of the world and is the great dynamic force that lies back of nil industry and progress. Return to the old standards of wage and Industry in employment is unthinkable. The terrible tragedy of war which has Just ended and which lias brought the world to the verge of chaos and disaster would he in vain if there should ensue a return to the condi tions of tlie past. Europe Itself, whence has come the unrest which now holds the world at bay,.is an ex ample of stand-patism In these vital human matters which America might well accept as an example, not to be followed, but studiously to be avoided. U. 8. Should Taka Lead. Europe made labor the differential, and the price of It all is enmity and antagonism and prostrated industry. The right of labor to live in peace and comfort must be recognized by gov ernments and America should be the first to lay tlie foundation stones upon which industrial peace shall be built. Labor not only is entitled to an ade quate wage, but capital should receive a reasonable return upon Its invest ment and is entitled to protection at the hands of the government in every emergency. No government worthy of the name can ‘‘play’* these elements against each other, for there is a mu tuality of interest between them which the government must seek to express and to safeguard at all cost The right of Individuals to strttco la inviolate and ought not to be Inter fered with by any process of govern ment, but there is a pre-eminent rlgnt and that is the right of the govern ment to protect ell of Its people end to assert its power uuu uiujestf Against the challeuge of any class. The government, when it asserts that right, seeks not to antagonize a class but simply to defend tho right of the whole people as against the Irrepara ble harm and injury that might be done by the attempt by uny class to usurp a power that only government Itself has a right to exercise as a pro tection to all. U. 8. Must Solve Question Peaceably. In the matter of international dis putes which have led to war, states men have sought to set up as a rem edy arbitration for war. Does this not point the way for the settlement of Industrial disputes by the establish ment of a tribunal, fair and just, alike to all, which will settle industrial dis putes which In the past have led to war and disaster? America, witnessing the evil conse quences which have followed out of such disputes between the contending forces, must not admit itself Impotent to deal with these matters by means 6f peaceful processes. Surely, there must be some method of bringing to gether in a council of peace and amity these two great Interests, out of which will come a happier day of peace and cooperation, a day that will make for more comfort and happiness in living and a more tolerable condition amoug all classes of men. Certainly human intelligence can de vise some acceptable tribunal for ad justing the differences between cap ital and labofe Hour of Tost for America Is Here. This is the hour of test and trial for America. By her prowess and strength, and the indomitable courage of her soldiers, she demonstrated her power to vindicate on foreign battle fields her conception of liberty and justice. Let not her influence as a mediator between capital and labor be weakened-and her own failure to set tle matters of purely domestic con cern be proclaimed to the world. There are those in this country who threateu direct action to force their will upon a majority. Russia today, with its blood and terror, Is a painful object lesson of the power of minor ities. It makes little difference what minority it is, whether capital or la bor, or any other class, no sort of privilege will be permitted to domi nate this country. We are a partner ship or nothing that is worth white. We are a democracy, where the ma jority are the masters, or all the hopes and purposes of the men who founded this government have been defeated and forgotten. U. 8. Will Not Stand Any Threats. In America there is but one way in which great reforms can be accom plished and the relief sought by classes obtained, and that is through the or derly processes of representative gov ernment. Those who would propose any other method of reform are ene mies of this country. America will not be dauuted by threats nor lose her composure or calmndls In these dis tressing times. We can afford In the midst of this day of passion and unrest, to be self contained and sure. The instrument of all reform In America Is the straight road of justice to nil classes and condi tions of men. Men have but to follow this road to realize the full fruition of their <»bjects and purposes. Let those beware who would take the shorter roud of disorder and revolution. The right road is the road of justice and orderly process. TASK SET FOR CONGRESS Washington, Dec. 3. —President Wil son in liis message to Congress, rec ommended : Establishment of a national budget system. Simplification of Income and excess profits taxes. Legislation to secure employment and land for service men. Laws to encourage increased crop production. Protection for America's new chem ical and dyestuffs industry. Federal aid in the building of good roads. Development of forest resources. Enactment of Attorney Oeneral Pal mer's legislation for dealing with the reds. Legislation to reduce the cost of liv ing and extension of the Lever act Laws to bring about democratization of Industry, including participation ol workers in decisions affecting thef\ welfare. Establishment of the principles re garding labor laid down by the League of Nations. Kansas Shipping Coal. Pittsburg, Kan.—Kansas has got a toe hold In the coal mining business. Toward storm-swept southwest Kan sas, where the mercury Is hovering a few degrees below zero, is speeding the first car of coal mined by volun teer workers In the strip pits of the Pittsburg field. It was billfed out of Pittsburg to the mayor of Coldwater, Kan., and was expected to be followed by other cars destined for sections where the coal famine Is most acute. Renewing Negotiations. Washington.—Negotiations for a compromise ratification of the peace treaty were renewed with the reassem bling of Congress, but the general feel ing of senators on both sides was that It aright be some weeks before the miTMiwt readied the stage of formal actloa.