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It's a Cold Day When We Get Left. VOL. X. nOOD lUVER, OREGON, FRIDAY, DECEMBER 9, 1898. NO. 29. n I Text of PresidentyAI .7;'': nual Address. OUR LATE WAR A FEATURE Mo Suggestions Made . Regarding the 'Government of Our New Territories- Foreign Relations Generally Satis factory Hawaiian Annexation. To the Senate and House of Represent tlves: Notwithstanding the added burdens rendered necessary by the war, our people rejoice In a very satisfactory and steadily' Increasing degree of prosperity, evidenced, by the largest volume of business ever recorded. Every manufacture has been productive, i agricultural pursuits have yielded abundant returns, labor in the fields of Industry Is better rewarded, rev enue legislation passed by the present congress has increased the treasury's re ceipts to the amount estimated by its authors, the finances of the government have been successfully administered ana Its credit advanced to the first rank; while Its currency has been maintained at the world's highest standard. Military serv ice under a common flag ' and for a righteous cause has strengthened the national spirit and served to cement more closely than ever the fraternal bonds be tween every section of the country. A review of the relations of the United States to other powers, always appropri ate, is this year of primary importance. In view of the momentous issues which have risen, demanding in one instance the ultimate determination by arms and ln- , volvlng far-reaching consequences which will require the earnest attention of the congress. In my last annual message, very full consideration was given to the question of the duty of the government of the United States toward Spain and the Cu ban Insurrection, as being by far the most important problem with which we were called upon to deal. The considera tions then advanced, and the exposition of the views therein expressed, disclosed my sense of the extreme gravity of the situation. ; Setting aBlde, as logically unfounded or practically inadmissible, recogni tion of the Cuban Insurgents as belliger ents, recognition" of the independence of iCuba, neutral Intervention to end the war by imposing a rational compromise between the contestants, intervention in favor of one or the other party and the forcible annexation of the island, I con cluded it was honestly due to our friendly relations with Spain that she should be given a reasonable chance to realize her expectations of reform to which she had become irrevocably committed. Within a few weeks previously she had announced comprehensive Plana which it was confidently asserted would be- efficacious to remedy the evils so deeply affecting our own country, so In jurious to the true interests of ; the mother country, as well as to those of Cuba, and so repugnant to the universal sentiment of humanity. , , Destruction of the Maine. At this juncture, on the 15th of Febru ary last, occurred the destruction of the battle-ship Maine, while rightfully lying In the harbor of Havana on a mission of International courtesy and good will, a catastrophe the suspicious nature and horror of which stirred the nation's heart profoundly. It is a striking evidence of the' poise and sturdy good sense distin guishing our national character that this shocking blow, falling upon a generous people already deeply touched by pre ceding events in Cuba, did not move them to desperate resolve to tolerate no longer the existence of a condition ol danger ana disorder at our doors that made possible such a deed by whomsoever wrought. Yet the instinct of Justice prevailed, and the nation anxiously awaited the result of the searching investigation at once set on foot. The finding of the naval board of inquiry established that the origin of the explosion was external by a subma rine mine, and only halted, through lack of positive testimony, to fix the responsi bility of its authorship. . PREPARATIONS FOR WAR. Congress' Appropriation of Fifty Mil. lions for National Defense. ..... .. . All those things carried conviction to the most thoughtful, even before the finding, of the naval court, that a orlsls In our relations with Spain and toward Cuba was at hand. 8p trong was. this belief that it needed but a brief execu tive suggestion to congress to receive im mediate answer to the duty of making Instant provision for the possible and per haps speedily probable emergency of war, and the remarkable, almost unique, spec tacle was presented of a unanimous vote of both houses on the 9th of March ap propriating $50,000,000 "for the national de fense and for each and every purpose con nected therewith, to be expended at the discretion of the president." iThat this act of provision oame none Wo soon was disclosed when the applica tion of the fund was undertaken. Our ports were practically undefended; our navy needed large provision for Increased ammunition and supplies, and even num bers to cope with any sudden attack from the navy of Spain, which comprised mod ern vessels of the highest type of conti nental perfection. Our army also re quired enlargement of men and muni tions. The details of the hurried prepa rations for the decided contingency is told In the reports of the secretaries of war and of the navy, and need not be repeated here. . , - ' It is sufficient to say that the outbreak of war, when it did come, found our na tion not unprepared to meet the conflict, j nor was the apprehension of coming strife confined to our own country. It was felt by the continental powers, which, on April 8, through their ambassadors and envoys, j addressed to the executive an expression ! of hope that humanity and moderation might mark the course of this govern- ment and people, and that further nego- tlations would lead to an attempt, which, while securing the maintenance of peace, would affirm all necessary guarantees for the re-establishment of order in Cuba. j Proposal of an Armistice. I Still animated by the hope of a peace ful solution and obeying the dictates of duty, no effort was relaxed to bring about i speedy ending- of the Cuban struggle. I -.-e-. - " ...... ftrtivelv with the o-ovemment of ftnaln looking to the Immediate conclusion of a six months' armistice In Cuba with a view to effect the recognition of her peo ple's right to Independence. Besides this, the instant revocation of the order of re concentration was asked, so that the suf ferers, returning to their homes and aided by united American and Spanish effort, might be put In a way to support themselves, and by orderly resumption of the, well-nigh destroyed productive ener gies of the Island contribute to "the res toration of Its tranquillity and well-being. Authority to Intervene. Grieved and disappointed at this barren outcome of my sincere endeavors to reach a practicable solution, I felt it my duty to remit the whole question to congress. In the message of April 11, 1898, I announced that with this last overture in the direc tion of immediate peace in Cuba and its disappointing reception by Spain the ef fort of the executive was brought o an end. - I again reviewed the alternative course of action which I had prepared, concluding that the only course consonant with International policy and compatible with our firmly set historical traditions was intervention as a neutral to stop the war and check the hopeless sacrifice of life, even though that resort involved "hostile constraint upon both parties to the contest, as well to enforce a truce as to provide for eventual settlement." On April 22 I proclaimed a blockade of the northern coast of Cuba, including ports on said coast between Cardenas and Bahla Honda and the port of Cienfuegos, on the south coast of Cuba; and on the 23d I called for volunteers to execute the pur pose of the resolution. The Declaration of War. By my message of April 25, congress was Informed of the situation, and I recom mended formal declaration of the exist ence of a state of war between the United States and Spain. Congress accordingly voted on the same day the act approved April 25, 1S98, declaring the existence of such war from and Including the 21st day of April, and re-enacted the provision of the . resolution of April 20, directing the president to use all the armed forces of the nation to carry that act Into effect. Due notification of the existence .of war as aforesaid was given April 25 by tele graph to all the governments with which the United States maintained relations, in order that their neutrality might be c sured during the war. The various govern ments responded with proclamations ol neutrality, each after its own method. It is not among the least gratifying Incidents of the struggle that the obligations of neutrality were Impartially discharged by all, often under delicate and difficult cir cumstances. The national defense fund of $30,000,000 was expended in large part by the army and the navy, and the objectB for which It was used are fully shown in the reports of the several secretaries. It was a most timely appropriation, enabling the government to strengthen Its defenses and to make preparations greatly needed in case of war. This fund being inadequate to the requirements of equipment and for the conduct of the war, the patriotism of congress provided the means in the war revenue act of June 13 by authorizing a 3 per cent popular loan, not to exceed $400,000,000, and by levying additional im posts and taxes. Of the authorized loan, $200,000,000 was offered and promptly taken, the subscriptions so far exceeding the call as to cover it many times over. While preference was given to the small er bids, no single allotment exceeded $5000. This was a most encouraging and significant result, showing the vast re sources of the nation and the determina tion of the people to uphold their coun try's honor. PROGRESS OF THE CONFLICT. , Brilliant Series of Victories for . American Arms. It la not within the province of ' this message to narrate the history of the extraordinary war that followed the Spanish declaration of April. 21, but a brief recital of its more salient features is appropriate. The first encounter of the war in point of date took place April 27, when a detachment of the blockading squadron made a reconnoissance in force at Matanzas, shelled the harbor fortifica tions and demolished several new works In construction. Dewey nt Manila. The next engagement was destined to mark a memorable epoch in maritime war fare. The Pacific fleet, under Commo dore George Dewey, had lain for some weeks at Hong Kong. Upon the colonial proclamation of neutrality being Issued and the customary 24 hours' notice being given, it repaired to Mlrs bay, near Hong Kong, whence it proceeded to the Philip pine islands under telegraphic orders to capture or destroy the formidable Span ish fleet then assembled at Manila. At daybreak on May 1 the American force entered Manila bay, and after a few hours' engagement effected the total destruction of the Spanish fleet, consisting of 10 war ships and a transport, besides capturing the naval station and forts at (Javlte, thus annihilating the Spanish naval power in the Pacific ocean and completely control ling the bay of Manila, with the ability to take the city at will. Not a life was lost on our ships, the wounded number ing only seven, while not a vessel wag materially injured. For this gallant achievement congress, upon my recom mendation, fitly bestowed upon the actors preferment and substantial reward. No Divided Victory. Only reluctance to cause needless loss of life and property prevented the early storming and capture of the city, and therewith the absolute military occupation of the whole group. The Insurgents, meanwhile had resumed the active hos tilities suspended by the uncompleted truce of December, 1897. Their forces in vested Manila on the northern and east ern, side, but were constrained by Admiral Dewey and General Merrltt from attempt ing an assault. It was fitting that what ever was to be done in the way of de cisive operations in that quarter should be accomplished by the strong arm of the United States alone. Obeying ,the etern precept of war, which enjoins the overcoming of the adversary and the extinction of his power wherever assailable as the speedy and sure means to win a peace, divided victory was not permissible, for no partition of the rights and responsibilities attending the enforce ment of a Just and advantageous peace could be thought of. . . Following the adoption of a comprehen sive scheme of general attack, powerful foroes were assembled at various points on our coast to invade Cuba and Porto Rico. Meanwhile, naval demonstrations were made at several exposed points. May 11 the cruiser Wilmington and torpedo-boat Winslow were unsuccessful In an attempt to silence the batteries at Cardenas, in Matanzas,1 Ensign Worth Bagley and four seamen falling. These grievous .fatalities ; were strangely enough among the very j few which occurred- during our naval operations In this extraordinary oonfllct. I Hobson's Heroism. The next act In the war thrilled not .alone the hearts of our countrymen, but the world, by its exceptional heroism. On the night of June 3 Lieutenant Hob .son, aided by seven devoted volunteers, blocked the narrow outlet from Santiago , harbor by sinking the collier Merrlmac in the channel under a fierce fire from the shore batteries, escaping with their lives as by a miracle, but falling into the hands of the Spaniards. It Is a most grat ifying Incident of the war that the brav ery of this little band of heroes was cor dially appreciated by the Spaniards, who sent a flag of truce to notify Admiral Sampson of their safety and to compli ment them upon their daring act. They were subsequently exchanged, July 7. By June 7 the cutting of the last Cuban cable isolated the island. Thereafter the invasion was vigorously prosecuted. June 10, under a heavy protecting fire, a land ing force of 600 marines from the Oregon, Marblehead and Yankee was effected at Guantanamo bay, where It had been de termined to establish a cable station. This important and essential port was taken from the enemy after severe : fighting by the marines, who were the first organized force of the United States to land in Cuba. The position so won was held, despite the desperate attempts to dislodge our fdrces. By June 16 additional forces were landed and strongly intrenched. June 22 the advance of the invading army under Major-General Shafter landed at Daiquiri, about 15 miles east of Santi ago. This was accomplished under great difficulties, but with marvelous dispatch. On June 23 the movement against Santiago was begun. On the 24th the first serious engagement took place In which the First and Tenth cavalry and the First volunteer cavalry, General Young's brigade of General Wheeler's division, participated, losing heavily. By , nightfall, however, ground within five miles of Santiago was won. The advantage was steadily Increased. On July 1 a severe battle took place, our forces gaining the outer works of Santiago, and El Caney and San Juan were taken after a desperate charge and the invest ment of the city : was completed. The navy co-operated by shelling the town and the coast forts. Destruction of the Armada. On the day following this brilliant achievement of our land forces, July 3, occurred the decisive naval combat of the war. The Spanish fleet, attempting to leave the harbor, was met by the Ameri can squadron under command of Commo dore Sampson. In less than three hours all the Spanish ships were destroyed. Two torpedo-boats were sunk and the Ma ria Teresa, Almlrante Oquendo, Vizcaya and Cristobal Colon were driven ashore. The Spanish admiral and over 1300 men were taken prisoners. . While the enemy's loss of life was deplorably large, some 200 perishing, on our side but one man was killed and one man seriously wounded. Although our ships were repeatedly struck, not one was seriously injured. The men also conspicuously distinguished them selves, from the commanders to the gun ners and the unnamed heroes in the boiler-rooms, each and all contributing toward the achievement of this astound ing victory, for which neither ancient nor modern history affords a parallel in the completeness of the event and the marvel ous disproportion of casualties. It would be invidious to single out any for special honor. Deserved promotion has rewarded the mere conspicuous actors the nation's profoundest gratitude is due to all of those brave men who by their skill and devo tion in- a few short hours crushed the sea power of Spain and wrought a triumph whose decisiveness and far-reaching ef fects can scarcely be measured. Nor can we be unmindful of the achievements of our builders, mechanics and artisans for their skill in the construction of our war ships. i ' , ; With the catastrophe of' Santiago, Spain's effort upon the ocean virtually ceased. A spasmodic effort toward the end of June to send her Mediterranean fleet, under 'Admiral Camara, to relieve Manila was abandoned, the expedition be ing recalled after It had passed through the Suez canal. . . : . Surrender of Santiago. , The capitulation of Santiago followed.. The city was closely besieged by land, while the entrance of our ships into the harbor cut off all relief on that side. After a truce' to allow of the removal of the noncombatants, protracted negotiations continued from July 3 until July 15, when, under menace of immediate assault, the preliminaries of surrender were agreed upon. On the 17th General Shafter occu pied the city. The capitulation embraced the entire eastern end of Cuba. The num ber of Spanish soldiers surrendered was 22,000, all of whom were subsequently con veyed to Spain at the charge of the United States. The story of this success ful campaign Is told in the report of the secretary of war which will be laid be fore you.'. . .j - .' . .. ;.: , Invasion of Porto Rico. ... " With the fall of Santiago, the occupa tion of Porto Rico became the next strat egic necessity. General Miles had pre viously been assigned to organize an ex pedition lorh that purpose. Fortunately, he was already at Santiago, where he had arrived on the 11th of July with reinforce ments for General Shaffer's army. With these troops, consisting of 3415 Infantry and artillery, two companies of engineers and one company of the signal corps. Gen eral Miles left Guantanamo July 21, hav ing nine transports convoyed by the fleet under Captain Hlgglnson, with the Mas sachusetts (flagship), Dixie, Gloucester, Columbia, and Yale, the two latter carry ing troops. The expedition landed at Guanlca, July 25, which port was Entered with little opposition. Here the fleet was joined by the Annapolis and Wasp, while the Puritan and Amphitrlte went to San Juan and Joined the New Orleans, which was engaged in blockading that port. The major-general commanding was subse quently, reinforced by General Schwann's brigade of the Third army corps, by Gen eral Wilson with a part of his division, and also by General Brooke, with a part of his corps, numbering In all 16,973 officers and men. On July 27 he eittered Ponce, one of the most important points in the island, from which he thereafter directed operations for the capture of the Island. As a potent Influence toward peace, the outcome of the Porto Rican expedition Is due to those who participated in it. Last Battle of the War. , The last scene of the war was enacted at Manila, its starting place. On August 15. after a brief assault upon the works by the land forces, in which the squadron assisted, the capital surrendered uncondi tionally. - The casualties were compara tively few. By this conquest of the Phil ippine Islands, virtually accomplished when the Spanish capacity for resistance was destroyed by Admiral Dewey's vic tory of the first of May, the result of the war was formally sealed. To General Merrltt, his officers and men, for their un complaining and devoted services, for their gallantry In action, the nation is sincerely grateful. Tneir long voyage was made , with singular success, and the soldierly ! conduct of the men, of whom many were without previous experience In the mill- ' tary service, deserves unmeasured praise. Total Casualties. ; The total casualties in killed and wound ed in the army during the -war was as fol lows: , . 1 ; ' ' . Officers killed, '23; enllsttd men killed, 257; total, 280; officers wounded, 113; en listed men wounded, 1464; total, 1577. Of the navy, killed, 17; wounded, 67; died as result of wounds, 1; invalided from service, 6; total, 91. . -. PEACH NEGOTIATIONS. Spain's Overtures for a Cessation of - ; Hostilities. ; The annihilation of Admiral Cervera's fleet, followed by the -capitulation of San tiago, having brought to the Spanish gov ernment a realizing sense of the hopeless ness of continuing a struggle now becom ing wholly unequal. It made overtures of peace through the French ambassaddr, who, with the assent of his government, had acted as the friendly representative of Spain's interests during the war., -On the 26th of July, M. Cambon presented a communication, signed by the Duke of Almodovar, the Spanish minister of state. Inviting the United States to state the terms upon which it would be willing to make peace. July 30, by a communication addressed to the Duke of Almodovar, and handed by M. Cambon, the terms of this government were announced substantially In the protocol, afterwards signed. On August 10, the Spanish reply dated August 7 was handed by M. Cambon to the sec retary of state. It accepted uncondi tionally1 the terms imposed as to Cuba, Porto Rico, and an Island of the Ladrone group, but appeared to seek to introduce inadmissible reservations in regard to our demand as to the Philippines. Conceiving that discussion on this point could neither be "practicable nor profitable, I directed that, In order to avoid mis understanding, the matter should be forthwith closed by proposing the em bodiment In a formal protocol of the terms in which the negotiations for peace were undertaken. The vague and inex plicit suggestions of the Spanish note could not be accepted, the only reply be ing to present as a virtual ultimatum; a draft of the protocol, embodying the pre cise terms tendered to Spain in our note of July 30, . which added stipulations of details as to the appointment of com missioners to arrange for the evacuation of the Spanish. Antilles. On August 12, M. Cambon announced hia receipt ot full powers to sign the protocol as submitted. Terms of the Protocol. x Accordingly, on the afternoon of August 12, M. Cambon as the plenipotentiary of Spain and the secretary of state, as the plenipotentiary , of the United States, signed the protocol providing: "Article 1. Spain will relinquish all claim-of sovereignty over and title to Cuba. ' "Article 2. Spain will cede to the United States the Island of Porto Rico and other islands now under Spanish sovereignty in the West Indies, and also an island in the Ladrones to be selected by the United States. - ' ' "Article . The United States will occu py and hold the city, bay and harbor of Manila, pending the conclusion of a treaty of peace, which shall determine the con trol, disposition and government of the Philippines." . The fourth article provided for the. ap pointment of joint commissions on the part of the United States and Spain to meet in Havana and Ban Juan, respective ly, for the purpose of arranging and car rying out the details of the stipulated evacuation of Cuba, Porto Rico and other Spanish islands in the West Indies. , The fifth article . provided for the ap pointment of not more than five commis sioners on each side to meet at Paris not later than October 1, and to proceed to the negotiation ' and conclusion 'of a treaty of peace, subject to ratification ac cording to, the respective constitutional forms of the two countries. ' The sixth and last article provides that upon the signing of the protocol, hostili ties between the two countries shall be suspended, and that notice to that effect should be given as soon as possible by each government to Jhe commanders of Its naval forces. Immediately upon the conclusion of the protocol, I Issued the proclamation of Au gust 12, suspending hostilities on the part, of . the United States. The necessary orr ders to that end were at once given by tel egraph. The blockade of the ports of Cu ba and of San Juan de Porto Rico was in like manner raised. , On August 18, the muster-out of 100,000 volunteers, or as near that number as was found to be practica ble, was ordered. On December 1, 101,655 of ficers and men had been mustered out and discharged from the service; 9002 more will be mustered out by the 10th of the month; also a corresponding number of generals and general staff officers have been hon orably discharged from the service. The military commissions to superintend the evacuation of Cuba, Porto Rico and the adjacent islands were forthwith ap pointed: For : Cuba Major-General James F. Wade, Rear-Admiral William T. Sampson, Major-General Matthew C. Butler. For Porto Rico Major-General John C. Brooke, Rear-Admiral Winfleld Scott Schley, Brigadier-General W. Gordon. They soon afterwards met the Spanish commissioners at Havana and San Juan, respectively. The Porto Rico Joint commis sion speedily accomplished its task, and by October 18 the evacuation ol tne island was completed. The United States flag was raised over the Island at noon that day. The administration of its affairs has been provisionally Intrusted to a military governor until congress shall otherwise provide. The Cuban Joint high commis sion has not yet terminated its labors. Ow ing to the difficulties in the way of remov ing the large number of Spanish troops still in Cuba,, the evacuation cannot, be completed before the 1st of January next. , The. Peace Commission. ; Pursuant to the fifth article of the pro-, tocol, I appointed William R. Day, lately secretary of state; Cushman K. Davis, William P. Frye and George Gray, senatora of the United States, and Whitelaw Reld, to be peace commissioners on the part of the United States. Proceeding in due season to Paris, they there met, on the 1st of October, five commissioners sim ilarly appointed on the part of Spain. Tho negotiations have made hopeful progress, so that I trust soon to be able to lay a definite treaty of peace before the senate, with a review of the steps leading to its signature. I , - OUR FOREIGN RELATIONS. Aside From Spain We Have Had No Serious Differences , With Other .., Nations. 4 - With the exception of the rupture with Spain, the Intercourse of the United States with the great family of nations has been marked with cordiality, and the close of the eventful year finds most of the Issues that necessarily arise in the complex rela- ; tlons of sovereign states adjusted or pre senting no serious obstacles to adjust ment and honorable solution by amicable agreement. A long-unsettled dispute as to the ex- tended boundary between the Argentina republlo and Chile, stretching along the Andean crests, from the southern bor der of the Ataeama desert to the Magel lan straits, nearly a third of the length of the South American continent, as. sumed an acute stage In the early part or the year and afforded this government occasion to express the hope that the re sort to arbitration, already contemplated by existing conventions between the par ties, might prevail, despite the grave diffi culties arising in Its application. I ani happy to say that arrangements to this end have been perfected, the questions of iact upon wmon tne respective commis sioners were unable to agree being in course of reference to her Britannic ma jesty for. determination. A residual dif ference, touching the northern boundary line across the Ataeama desert, for which existing treaties provided no adequate ad justment, bids fair to be settled in 'like manner by a Joint commission, upon whioh the United States minister at Buenoa Ayres has been invited to serve as um pire in the last resort. ' International Cable Agreement. I have found occasion to approach ' the Argentine government with a view to re moving differences of rate charges im posed upon the cables of an American corporation in the transmission 'between Buenos Ayres and the cities of Uruguay and Brazil of through messages passing from and to the United States. Although the matter is complicated by exclusive concessions by Uruguay and Brazil to foreign companies, there Is a strong hope that a good understanding will be reached and that the important channels of com mercial communication between " the United States and the Atlantic cities of boutn America may be freed from an al most prohibitory discrimination. ForelKn Exhibition. Despite the brief time allotted for prep aration, the exhibits of this country at the universal exposition at Brussels in 1897 enjoyed the singular distinction of larger proportion of awards, having re gard to the number and classes of articles entered, than those of other countries. The worth of such a result In making known our national capacity to supply the world's markets is obvious. The Nicaragua Canal. The Nicaragua canal commission, ' under Rear-Admiral John G. Walker, appointed July 24, 1897, under the authority of a provision in tne sundry civil act of June 4, of that year, has nearly oompleted Its labors, and the results of Its exhaustive Inquiry Into the proper route, the feasibil ity and the cost of construction of an in- teroceanic canal by the Nicaragua route. will be laid before you. In the perform ance of its work the commission reoelved all. possible courtesy and asalstance from the governments of Nicaragua and Costa Rica, which thus testified thAlr flnnrpnift- tlon of the Importance of giving a speedy and practical outcome of the project that nas lor eo many years engrossed the at tention of the respective countries. As the scope of recent Inquiry embraced the whole subject with the aim of making plans and surveys for a canal by the most convenient route, it necessarily included a review of the results of previous sur veys and plans, and In particular those adopted by the Maritime Canal Company under its existing concessions from Nica ragua and Costa Rica, so that to this ex tent these grants necessarily held en es sential part in the deliberations and con clusions of the canal commission as they have held and must needs hold in the dis cussion of the matter By congress. Un der these circumstances, and in view of overtures made to the governments of Nicaragua and Costa Rica by other par ties for a new canal concession predicated on the assumed approaching lapse of the contracts of the Maritime Canal Company with those states, I have not hesitated to express my convictions that considerations of expediency and international policy, as between the several governments inter ested in the : construction and control of an interoceanlo canal by this route re quire the maintenance of the status quo until the canal commission shall have re ported and the United States congress shall have had the opportunity to pass finally upon the whole matter during the present session without prejudice by rea son of any change in the existing condi tions. Nevertheless, it appears that the gov ernment of Nicaragua, as one of Its last sovereign acts before merging its pow ers in those of the newly formed United States of Central America, has granted an optional concession to another association to become effective on the expiration of the present grant. It does not appear that surveys have been made or what route Is proposed. under this concession, so that an examination of the feasibility of its plans Is necessarily not embraced In the report of the canal commission. All these circumstances suggest the ur gency of some definite action by congress at this session if the labors of the past are to be utilized and the linking of the Atlantic and pacific oceans by a practical waterway Is to be , realized. That the construction of such a maritime highway is now more than ever Indispensable to that Intimate and ready Intercommuni cation between our eastern and western seaboards demanded by the annexation of the Hawaiian islands and the prospec tive expansion of our influence And com merce to the Pacific, and that our national policy now more imperatively than ever calls for Its control by this government, are propositions which I doubt not con gress will duly appreciate and wisely act upon. i . ... Trade ,' Relations With : France and . Germany. The commercial arrangements made with France on May 28, 1898, under the provisions of section 8, of the tariff act of 1897, went into effect on June 1 follow ing,' It has relieved a portion of our ex port trade from serious embarrassment. Further negotiations are now pending under section 4 of the same act, with a view to the increase of trade between the two countries to their mutual ad vantage. Negotiations with other govern ments, in part Interrupted by the war with Spain, are in progress under both sections of the tariff act, I hope to be able to announce some of the results of these negotiations during the present ses sion of congress. . , ANNEXATION OF HAWAII. Existinar Lows In Force Pending Ac tion by Congress. - - - Pending the consideration by the senate of the treaty signed June 16, 1897, by the plenipotentiaries of the United States and 1 of the republic of Hawaii, providing for ! the annexation of the island, a Joint reso- lution to accomplish the same purpose by j accepting the offered cession and lncor- ' porating the ceded territory into the Union was adopted by congress and ap proved July 7, 1898. I thereupon directed the United States, steamer Philadelphia to convey Rear-Admiral Miller to Hono lulu and entrusted to his hands this im portant legislative act to be delivered to the president of the republic of Hawaii, with whom the admiral and the United Stales minister were authorized to make appropriate arrangements for transfer ring the sovereignty of the islands to the United States. This was simply but im pressively accomplished on August 12 last, by the delivery of a certified- copy of the resolution to President Dole, who thereupon yielded up to the representa tive of the government of the United States the sovereignty and public prop erty of the Hawaiian islands. Pursuant to the terms of the Joint -resolution and in exercise, of authority thereby con ferred upon me, I directed that the civil, judicial and military powers heretofore exercised by the offioers : of the govern ment of the republic of Hawaii should continue to be exercised by those officers until congress should provide a, govern ment for the incorporated territory, sub ject to my power to remove such officers and to fill vacancies. - The present offi cers and troops of the republlo thereup on took tha oath of allegiance to tho United States, thus providing for the un interrupted continuance of all the admin-, lstratlve and municipal functions of the annexed territory until congress shall oth erwise enact. Following the further provision of the Joint resolution, I appointed the Honor ables Shelby M. Cullom, of Illinois; John T. Morgan, of Alabama; Robert R. HItt, of Illinois; Sanford B. Dole, of Hawaii, and Walter F. Grier, of Hawaii, as com missioners to confer and recommend to congress such legislation concerning the Hawaiian Islands as they should deem necessary or proper..'. Recommendations of the Commission. The commissioners having fulfilled the mission confided to them, their report will be laid before you at an early day. It Is believed that their recommenda tions will have the earnest consideration due to the magnitude of the responsibility resting upon you to give such shape to the relationship of those mid-Pacific lands to our home union as will benefit both In the highest degree, realizing the sspira--tlons of the community that has cast its lot with us ardi elected to share our po litical heritage, while, at the Bame time. Justifying the foresight of those who for three-quarters of a-century have looked to the assimilation of Hawaii as a natural SJ)d Inevitable consummation In harmony with our needs and In fulfillment of our cherished traditions. , New Maritime Policy. The annexation of "Hawaii and the changed relations of the United States to Cuba, Porto Rico and the Philippines re sulting from the war, compel the promnt adoption of a maritime policy by frequent steamship communication encouraged by the United states, under the American flag, with the newly acquired Islands. Spain furnished to Its colonies, at an annual coat of about $2,000,000, steamship lines com munlcating with a portion of the world's markets as well as with trade centers of the home -government. The United States Will not undertake td do less. It is our duty to furnish the people of Hawaii with facilities, under national control, for theli export and import trade. It will be con ceded that the present situation calls for legislation which shall be prompt, dur able and liberal. ' . ARMY REORGANIZATION. Standing: Force of 100,000 Men Needed Under Present Conditions. Under the act of congress approved April 26, 1898, authorizing the president in his discretion. Upon a declaration of war by congress or a declaration by congress that war exists, I directed the Increase of the regular army to the maximum of 62,000, authorized in said act. , - There are now in the regular army 67, 862 officers and men. In said act it was provided: "That at the end of any war in which the United) States may become in volved, the army shall be reduced to a peace basis by transfer in the same arm of the-service or absorption, by pro motion or honorable discharge, under such regulations as the secretary may es- (tablish. of .pnrtprTi"-rnrv noryymnrA ou ters and the honorable discharge or trans, fer ol supernumerary emisieu men, and nothing contained in this act shall -be construed as authorizing the permanent increase of the command of enlisted force of the regular army beyond that now pro vided by the law In force prior to the passage of this act except as to the In crease of 25 majors provided for In section 1 hereof." .,: , .- ,;' . ' The importance of legislation for the. permanent increase of the army is there fore manifest, and the recommendation of the secretarj- of war for that purpose has my unqualified approval. There can be no question that at this time and prob ably for some time in the future 100,000 men' will be none too many to 'meet the necessities of the situation. At all events, whether that number- shall be required permanently or not, the power should be given to the president to enlist that force if in his discretion It should be neces sary, and the further discretion- Bhould be given him to recruit within the above limit from the inhabitants of the Islands with the government of which we are charged. ,.- .: - ,,- Volunteers to Be Sent Home. ' It is my purpose to muster out the en tire volunteer army as soon as congress shall provide for the Increase of the regu- 1 lar establishment. This will be only an act of justice, and will be much appre ciated by the brave men who left their homes and employments to help the coun. try in Its emergency. ) ' Capital Centennial. In the year 1900 will oocur the centen nial anniversary . of the founding of the city of Washington . for the permanent capital of the government of the United States by authority of an act of con gress approved July 16, 1790. In May, 1800, the archives and general offices of the federal government were removed to this place. On the 17th of November, 1800, the national congress met here for the first time and assumed exclusive control of the federal district and city. This inter esting event assumes all the more signify oance when we recall the circumstance! attending the choosing of the site, tht naming of the capital in honor of the father of his country, and the interest taken by him In the adoption of plans foi its future development on a magnificent 1 scale. ,. These orginal plans have been wrought out with a constant progress and a sig nal success, even beyond anything theli framers had foreseen. : :,:. Labor Lam.' -The alien contract law Is shown by ex perience to need some amendment; a measure providing better protection foi seamen is proposed; the rightful applica. tlon of the eight-hour law for the benefit : of labor and of the principle of arbltra. tlon are suggested for consideration, and I commend these subjects to the careful : consideration of congress. , . . ... Departmental Reports. -I The several departmental reports will be laid before you. They give In great detail the conduct of the affairs of tha government during the past year, and dis cuss many questions upon which con gress may be called upon to act. W1I4JAM M'KINIJET,