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About The Hood River glacier. (Hood River, Or.) 1889-1933 | View Entire Issue (Dec. 6, 1895)
7 The Hood River Glacier It's a Cold Day When We Get Left. VOL. 7. HOOD RIVER, OREGON, FRIDAY. DECEMBER 6, 1895. NO. 28. PRESIDENT'S MESSAGE Foreign Relations and the Financial Question. RETIREMENT OP GREENBACKS Proponed as tbe Sole Remedy for the Present Fiscal and Financial Ills of the Country Washington, Deo. 8. President Cleveland s first message to the Fifty fourth oongress was presented to and read in the two houses today. It is as follows: . The present assemblage of the legis- lative branch of our government ooours at a time when the interests of our peo ple and the needs of the country give espeoial prominenoe to the condition of our foreign relations and the ex igencies of our national finances. The reports of the heads of the government departments fully and plainly exhibit what has been accomplished within the soope of their respective duties, and present such recommendations for the betterment of our country's conditions as patriotio and intelligent labor and observation suggest. I therefore deem my exeoutive duty adequately performed, at this time, by presenting to congress the important phases of our situation, as related to our intercourse with foreign nations, and a statement of the flnanoial prob lems whioh oonfront us, omitting, ex cept as they are related to these topics, any referenoe to departmental opera , tions. I earnestly invite, however, not only the oaref ul consideration, but the severely critioal sorutiny of the oongress and my fellow oountrymen to the reports concerning these depart mental operations. If justly and fairly examined, they will furnish proof of assiduous and painstaking care for the publio welfare. I press the recommendations they contain upon the respectful attention of those oharged with the duty of leg islation, because I believe their adop tion would promote the people's good. FINANCIAL QUESTION. A Discussion of the Situation and Some Recommendations. As we turn to a review of our na tional flnanoial situation, we are im mediately aware that we, approaoh a subject of domestio oonoern more im portant than any other whioh can en gage our attention, and one, at present, j : in such a perplexing and delioate pre dicament as to require prompt and wise treatment. We may well be encour aged to earnest effort in this direotion i when we recall the steps already taken toward improving our eoonomio and flnanoial situation and - when we ap preciate how well thn way has been prepared for further progress by an aroused and intelligent - popular inter est in these subjects. By command of the people a customs revenue system, designed for the pro- l teotion and benefit of ' favored classes, at the expense of the great mass of our oountrymen, and whioh, while in-1 effloient for the purpose of revenue, j curtailed our trade relations and im peded our entranoe to the markets of the world, has .been superseded by ' a I tariff polioy, whioh, in prinoiple, is based upon a denial of the right of the government to obstruct the avenues of our people's cheap living, or lessen their comfort and oontentment for the sake of aooording espeoial advantages ' to favorites, and whioh, while encour aging our intercourse and trade with other nations, recognizes the fact that Amerioan self-relianoe, thrift and in genuity oan build up our country's in dustries and develop its resources more surely than enervating paternalism. The oompuleory purchase and ooin age of silver by the government, un checked and unregulated by business conditions and heedless of our cur rency needs, whioh for more than fif teen years diluted our circulating med ium, undermined confidence abroad in our flnanoial ability, and at last cul minated in distress and panic at home, has been reoently stopped by the re peal of laws whioh forced this reckless soheme upon the oountry. The things 'thus accomplished, notwithstanding their extreme importance and beneficent effeots, fall far short of curing the monetary evils from whioh we suffer as a result of long indulgence in ill-advised financial expedients. The currenoy denominated United States notes, and oommonly known as greeenbaoks, was issued in large vol ume during the late oivil war and was intended originally to meet the exi gencies of that period. It will be seen by a referenoe to the debates in congress at the time the laws were passed, authorizing the issue of these notes, that their advocates declared they were intended for only temporary-use and to meet the emergency of the war. In almost, if not all the laws relating to them, some provision was made contemplating their volun tary or compulsory retirement. A large quantity of them, however, were kept on foot and mingled with the currency of the oountry, so that at ,the .1om of the yar 1874 they amounted to 1381,999,073. Immediately after that date, and in January, 1875, a law was passed providing for the resump tion of specie payments, by whioh the secretary of the treasury was required, whenever additional circulation was issued to national banks, to retire United States notes equal in amount to 80 per cent of such additional bank cir culation until suoh notes were reduoed to $300,000,000. This law further provided that, on and after the first day of January, 1879, the United States notes then outstading should be redeemed in ooin, and in order to pro vide and prepare for such redemption the secretary of the treasury was au thorized, not only to use any surplus revenues of the government, but to is sue bonds of the United States and dis pose of them for ooin, and to use the proceeds for the purposes contemplated by the statute. In May, 1878, and before the day thus appointed for the redemption and retirement of these notes, another stat ute was passed forbidding their fur ther cancellation and retirement Some of them had, however, been previously redeemed and cancelled upon the issue of additional national bank circulation, as permitted by the law of 1875, so that the amount out standing at the time of the passage of the aot forbidding their further retire ment was $346,681,016. The law of 1878 did not stop at dis tinct prohibiting, but contained in ad dition the following express provision: "And when any of said notes may be redeemed, or be reoeived into the treasury, under any law from any souroe whatever, and shall belong to the United States, they shall not be retired, oancelled or destroyed, 'but they shall be reissued and paid out again and kept in circulation. " ' This was the condition of affairs January 1, 1879, whioh bad been fixed upon four years before as the .date for entering upon the redemption and re tirement of all , these notes and for whioh suoh abundant means had been provided. The government was put in the an omalous situation of owing the lend ers of its notes debts payable in gold on demand, whioh could neither be re tired by receiving ' such notes in dis charge of obligations due the govern ment, nor canoelled by aotual payment in gold. It was forced to redeem with out redemption and to pay without ao quittance. ' ' ' ' There had been issued and sold $95,- 500,000 of the bonds authorized by the resumption aot of 1875, the proceeds of which, together with other gold in the treasury, created a gold fund deem ed sufficient to meet the demands which might be made upon it for the redemption of outstanding United States notes. This fund, together with such gold as might be from time to time in the treasury available for the purpose, has been since our gold re serve, and $100,000,000 has been re garded as an adequate amount to ao oomplish its object This fund amounted, January 1, 1879, to $114,- 193,360, and though, thereafter, con stantly fluctuating, it did not fall be-! low that sum until July, 1892. In April, 1893, for the first time since its establishment, this reserve amounted to less than $100,000,000, containing at that date only $97,011,330. . In the meantime, in July, 1890, an j aot had been passed directing larger government monthly purohases of sil ver than had been required under pre vious laws, and providing that in pay ment for suoh silver, treasury notes of the United States should be issued, payable on demand in gold or silver ooin at the discretion of the secretary of the treasury. It was, however, de clared in the aot to be "the establish ed policy of the United States to main tain the two metals on a parity with eaoh other, upon the present legal ra tio, or such ratio as may be provided by law." In view of this declaration it was not deemed permissible for the secre tary of the treasury to exeroise discre tion in terms oonferred on him by re fusing to pay gold on those notes when demanded, because by suoh discrimina tion in favor of the gold dollar the so- called parity of the two metals would be destroyed and grave and dangerous oonsequenoes would be preoipitated by affirming or accentuating the constant ly widening disparity between their ao tual values under the existing ratio. It thus resulted that the treasury notes issued in payment of silver purohases, under the law of 1890 we,re necessarily treated as gold obligations at the op tion of the holder. The notes on November 1, 1898, when the law compelling the monthly purohase of silver was repealed, amounted to more than $155,000,000. The notes of this description now out standing, added to the United States notes still undiminished by redemption or cancellation, constitute a volume of gold obligations amounting to nearly $500,000,000. These obligations are the instruments, whioh, ever sinoe we have had a gold reserve, have been used to deplete it The reserve, as has been stated, had fallen in April, 1893, to $97,011,830. It has from that time to the present, with very few and unimportant up ward movements, I steadily decreased, except it has been temporarily replen ished by the sale of, bonds.' Among the oausei for this constant .and uni- v' ;:r. y'-M - S- . form shrinkage in this fund may be mentioned the great falling off in ex ports under the operation of the tariff law, until reoently in foroe, whioh crippled our exchange of commodities with foreign nations, and necessitated to some extent the payment of our bal ance in gold. The unnatural influxion of silver into our oountry and the in creasing agitation for its free and un limited coinage, whioh have created apprehension as to our disposition or ability to continue gold payments, the consequent hoarding of gold at home, and the stoppage of investments of for eign capital, as well as the return of our securities already sold abroad, and the high rate of foreign exchange, whioh induoed the shipment of our gold to be drawn against, is a matter of speculation. In consequeneo of these conditions the gold reserve, on February 1, 1894, was reduoed to $85,438,377, having lost more than $31,000,000 during the preceding nine months, or since April, 1893. Its replenishment being neces sary, and no other manner of accom plishing it being possible, resort was had to the issue and sale of bonds, provided by the resumption act of 1875. Fifty millions of these bonds were so'd, yielding $68,633,295.71, whioh was added to tbe reserve fund of gold then on hand. As a result of this operation this reserve, whioh had suffered constant and large withdraw als in the meantime, stood, Maroh 6, 1894, at the sum of $107,446,802. Its depletion, however, was immediately therafter bo aooelerated that on June 80, 1894. it had fallen to $64,873,025, thus losing, by withdrawals, more than $42,000,000 in five months, and dropping slightly below its situation when the sale of $50,000,000 in bonds was effeoted for its replenishment. This depressed condition grew worse, and November 24, 1894, our gold re serve, being reduced to $57,669,701, it became necessary to strengthen it This was done by another sale of bonds, amounting to $50,000,000, from which there was realized $58,538,500, with which the fund was increased to $111,421,021 December 4, 1894. Again disappointment awaited the anxious hope for relief. There was not even a lull in the exasperating with drawals of gold. On the oontrary, they grew larger and more persistent than ever. Between December 4, 1894, and early in February, 1895, a period of scarcely more than two months after the second reinforcement of our gold reserve by the sale of bonds, it had lost, by snob, withdrawals, more than $69, 000,000, and had fallen to $41,340,181. Nearly $45,000,000 had been with drawn during the month immediately preceding this situation. In anticipation of pending trouble I had, January 28, 1895, addressed a communication to congress, fully set ting forth our difficulties, and danger ous position, and earnestly reoommend ing that authority be given the secre tary of , the treasury to issue bonds bearing a low rate of interest, payable by their terms in gold, for the purpose of maintaining a sufficient gold re serve, and also for the redemption and ooncellation of outstanding United States notes and treasury notes issued for the purohase of silver under the law of 1890. ' This recommendation did not, however, meet with legislative approval. In February, 1895, there fore, the situation was exceedingly oritioal. With a reserve perilously low and a refusal of congressional aid everything indicated that the end of gold payments by the government was imminent The results of prior bond issues had been exceedingly unsatisfac tory and the large withdrawals of gold, immediately succeeding their publio sale in open market, gave rise to a rea sonable suspioion that a large part of the gold paid into the treasury upon sales was promptly drawn out again by the presentation of United States notes or treasury notes and found its way to the hands of those who had only temporarily parted with it in the purohase of bonds. . In this emergency, and in view of its surrounding perplexities, it became entirely apparent to those upon whom the struggle for safety was devolved, not only that our gold reserve must, for the third time in less than thirteen months, be restored by another issue and sale of bonds bearing a high' rate of interest and badly suited to the pur pose, but that a plan must be adopted for their disposition promising better results than those realized on previous sales. An agreement was therefore made with a number of financiers and bankers wherby it was stipulated that the bonds described in the resumption aot of 1 875, payable in ' ooin thirty years after their date, bearing interest at the rate of 4 per cent per annum, and amounting to $62,000,000, should be exohanged for gold receivable by weight, amounting to a little more Wan $65,000,000. This gold was to be delivered in enoh installments as would complete its delivery within about six months from the date of the oontraot, and at least one-half of this amount was to be furnished from abroad. It was also agreed by those supplying this gold that during the oontinuanoe of the oontraot they would by every means in their power proteot the government against gold withdraw als. Tbe contract also provided that if congress would authorize th issue of bonds payable by their terms in gold and bearing interest at the rate of 3 per cent per annum they might within ten days be substituted at par for the 4 per cent bonds described in the agree ment. On the day the oontraot was made the terms were communicated to oongress by special' exeoutive message, in whioh it was stated that more than $16,000,000 would be saved to the gov ernment if gold bonds bearing 3 per oent interest were authorized to be sub stituted for those mentioned in the oon traot ; Congress having declined to grant the necessary authority to seoure this saving, the oontraot, unmodified, was oarried out, resulting in a gold reserve amounting to $17,671,880 July 8, 1895. The performance of this oontraot not only restored the reserve, but checked for a time the withdrawal of gold and brought on a period of restored confi dence and such peaoe and quiet in bus iness circles as were of the greatest possible benefit in every interest which affects our people. . I have never had the slighetest mis giving concerning the wisdom or pro priety of this arrangement, and am quite willing to answer for my full share of the responsibility for its pro motion. I believe it averted disaster, the imminence of whioh was fortunate ly not at the time generally understood by our people. If a fixed and stable standard is maintained, suoh as the magnitude and safety of our commercial transactions and business require, the use of money itself is conveniently minimized. Every dollar of fixed and stable value has, through the agenoy of confident oredit, an astonishing capacity of mul tiplying itself in flnanoial : work. Every unstable and fluctuating dollar fails as a basis of credit and in its use begets gambling speculation and un dermines the foundations of honest en terprises. I have ventured to express myself on this subjeot with earnestness and plain ness of speeoh beoause I cannot rid my self of the belief that there lurks in the proposition for the free coinage of silver, so strongly approved and so en thusiastically advocated by a multitude of my oountrymen, a serious menace to - our prosperity and an insidious temptation of our people to wander from the allegiance they owe to publio and private integrity. It is because I do not distrust the good faith and sin cerity of those who press this scheme that I have imperfectly, but zealously submitted my thoughts upon this mo mentous subjeot I cannot refrain from begging them to re-examine their views and beliefs in the light of patriotio reason and famil iar experience, and to weigh again and again the consequences of such legisla tion as their efforts have invited. Even the continued agitation of the subjeot adds greatly to the difficulties of a dan gerous financial situation already i forced upon us. OUR FOREIGN RELATIONS. Questions at Issue Between This and Other Governments. By mandatory tariff legislation) in January last, the Argentine Bepublio, recognizing the value of the large mar ket opened to the free importation of its wools under our last tariff act, has admitted certain products of the United States to enter at reduced duties. It is pleasing to note that the efforts we have made to enlarge the exchanges of trade on a sound basis of mutual bene fit, are in this instance appreciated by the oountry from whioh our woolen factories drew their needful supply of raw materials. . ' ' The missions boundary dispute be tween the Argentine Republio and Brazil, ' referred, to the president of the United States as arbitrator dur ing the term of my predecessor, and whioh was submitted to me for deter mination, resulted in an award in fa vor of Brazil, upon the historical and documentary evidenoe presented; thus ending a long-protracted controversy, and again demonstrating the wisdom and desirability of settling interna tional boundary disputes by recourse to friendly arbitration. - Negotiations are progressing for a revival of the United States and Chil ean claims commission, whose work was abruptly terminated last year by the expiration of the stipulated time within whioh amends could be made. Chile is a step of great interest and importance, both in its direot conse quences upon her own welfare, and as evincing cbe asoendenoy of sound finan cial principles in one of the most in fluential of the South American repub lics. . i2" Chinese Outbreaks. The olose of the momentous struggle between China and Japan, while re lieving the diplomatic agents of this government from the delioate duty they undertook, at the request of both oountries, of rendering such service to the subjeots of either belligerent within the territorial limits of the other as our neutral . position permit ted, developed a domestio condition in the Chinese empire whioh has caused much anxiety and called for prompt and oareful attention. Either as a re sult of a weak oontrul by the central government over the provincial admin istrations, following a diminution of tbe traditional governmental authority national disaster, or as a manifesta tion, upon good opportunity, of the aversion of the Chinese population to all foreign ways and undertakings, there have occurred, in widely sepa rated provinoes of China, serious out breaks of the old fanatical - spirit against foreigners, whioh, unchecked by the iooal authorities, if not actually oonnived at by them, have culminated in mob attaoks on foreign missionary stations, causing much destruction of property, and attended with personal injuries as well as loss of life. : Al though but one Amerioan oitizen was reported to have been aotually wound ed, and although the destruction of property may have fallen more heavily upon the missionaries of other nation alities than our own, it plainly be hooves this government to take the most prompt and decided aotion to guard against similar, or, perhaps, more dreadful calamities befalling the hundreds of Amerioans in that oountry. The demands of the United States and other powers for the degredation and punishment of the responsible officials of the respective cities and provinces who, by neglect or otherwise, had permitted uprisings, and for the adoption of stern measures by the em peror's government for the protection of the life and property of foreigners, were followed by the disgrace and dis missal of certain provincial officials found derelict in duty, and the punish ment by death of a number of those adjudged guilty of participating in the outrages. China will not forget either our kindly service to her citizens during her late war, nor the further faot that, while furnishing all the facilities at our oommand to further the negotia tions of a peace between her and Ja pan, we sought no advantages, and interposed no counsel.. The govern ments of both China and Japan have in special dispatches, transmitted through their respective diplomatio representatives, expressed in a most pleasing manner their grateful appreci ation of our assistance to their citizens during the unhappy struggle and of the value of our aid in paving the way to their resumption of peaoeful rela tions. The Waller Incident in France. The customary cordial relations be tween this oountry and France have been undisturbed,, with the exception that a full explanation of the treatment of John L. Waller by the expedition ary military authorities of France still remain to be given. Mr. Waller, for merly United States consul at Tama tive, remained in Madagascar after his term of offioe expired, and was, appar ently, successful in procuring business concessions from the Hovas, of greater or less value. After the occupation of Tamative and ' the declaration of martial law by the Frenoh, he was arrested upon various oharges, among them that of oommunioating military in formation to the enemies of Franoe; was tried and convicted by a military tribunal and sentenced to thirty years' imprisonment! Following the course justified by abundant precedents, this government requested from that of Franoe the record of the proceedings of the Frenoh tribunal, whioh resulted in Mr. Waller's condemnation. This re quest has been complied with to the extent of supplying a oopy of the of ficial record, from which appear the constitution and organization of the oourt, the charges as formulated and the general oourse and result of the trial, and by which it is shown that the accused was tried in open oourt and was defended by counsel; but the evidence . adduoed in support of the oharges, which was not received bv the Frenoh minister for foreign affairs till the first week in October, has thus far been withheld, the French government taking the ground that its production in response to our demand, would es tablish a bad precedent The efforts of our ambassador to secure it, how ever, though impeded by reoent changes in the Frenoh ministry, have not been relaxed, and it is confidently expected that some satisfactory solution of the matter will be shortly reached. . Mean while it appears that Mr. Waller's con finement has every alleviation whioh the state of his health and all the other circumstances Of the case demand or permit An agreeable contrast to the differ ence above noted, respecting a matter of common concern where nothing is sought exoept such a mutually satis factory outcome as the true merits of the case require, is the recent resolu tion of the French chambers favoring the conclusion of a permanent treaty of arbitration between the two co an tries. An invitation has been extended by Franoe to the government and the peo ple of the United States to participate in a great international exposition at Paris in 1900, as a suitable commem oration of the olose of this, the world's marvelous oentury of progress. I heartily reoommend its aoceptanoe, to gether with suoh legislation as will ad equately provide for a due representa tion of this government and its people on the occasion. : Serenity of Germany. Our relations with the states of tbe German empire are, in some aspects, typical of a condition of things else whoro 'found in countries whose pro ductions and trade are similar to our own. The close rivalries of competing industries, the influence of the delusive dootrine that the internal development of a nation is promoted and its wealth increased by a policy, which in under taking to reserve its home markets for , the exclusive use of its own produoers, neoessarily obstructs this class in for eign markets, and prevents free aocess to the produots of the world; the desire to retain trade in time-worn ruts, re gardless of the inexorable laws of new needs and changed conditions of de--mand and supply, and our own halting tardiness in inviting a free exchange , of commodities, and by this means im periling our footing in the external markets naturally open - to us, have created a situation somewhat injurious to Amerioan export interests not only in Germany, where they are perhaps most noticeable, but in ad jaoent ooun- ' tries. The Protection of the Sealing; Herds. Our relations with Great Britain, always intimate and important, have - demanded, during the past year, a greater share of consideration than is usual. - Several vexatious questions ! were left undetermined by the deoision ; of the Behring sea arbitration tribunal. The application of the principles laid j down by that august body has not been j followed by the results they were in- ' tended to accomplish, either because the principles themselves lacked in . breadth and definitness, or beoause their execution has been more or less imper fect Much correspondence has been exohanged between the two governments on the subject of preventing the , ex- -terminating slaughter of seals. The insufficiency of the British pa trol of Behring sea, under the regula- . tions agreed on by the two govern ments, has been pointed out, and yet only two British ships have been on po lice duty during this season in these waters. The need of a more effective enforcement of existing regulations, as well as the adoption of such additional regulations as experience has shown to be absolutely necessary to carry out the intent of the awards, have been -earnestly urged upon the British gov- ernment, but thus far without effeotive . results. In the meantime, the deple tion of the seal herds by means of pel agio hunting has so harmfully prog ressed, that, unless their slaughter is at onoe checked, their extinction, within a few years seems to be a mat ter of absolute certainty. " Venezuelan Boundary Dispute. It being apparent that the boundary dispute between Great Britain and the republio of Venezuela concerning the limits of British Guiana, was approach-' ing an acute stage, a definite statement pf the interest and policy of the United States, as regards the controversy, seemed to be required, both on its own aocount and in view of its relations : with the friendly powers direotly . con cerned. In July last, therefore, a dis patch was addressed to our ambassa dor at London for communication to the British government, in whioh the attitude of the United States was fully and distinctly set forth. The general conclusions therein reaobed and formu lated are' in substance that the' tradi tional and establihsed polioy of; this government is firmly opposed -to a forcible inorease by any . European ; power of its territorial possessions on this oontinent; that this polioy is as well founded in prinoiple as it is strongly supported by numerous prece dents; that as a consequence, the United States . is bound to protest against the enlargement of area of British Guiana in derogation of the rights and against the will of Vene zuela; that, considering tbe disparity in strength of Great Britain and Vene zuela, the territorial dispute between them can be reasonably settled only by friendly, impartial arbitration, and that the resort to such arbitration should inlolude the whole controversy, and is not satisfactory if one of the powers oonoerned is permitted, to draw an arbitrary line through the territory in debate, and to declare that it will . submit to abritration only the portion lying on one side of it In' view of these conclusions, the dispatch in ques tion called upon the British govern ment for a definite answer to the ques tion whether it would not submit the territorial controversy between itself and Venezuela, in its entirety, to im partial arbitration. The answer of the British government has not yet been reoeived, but is expected shortly, when further communication on the subjeot will probably be made to oongress. -. In conclusion, I specially entreat the people's representatives in congress, who are charged with the responsibil ity of inaugurating measures for the safety and prosperity of our common oountry, to promptly and effectively consider the ills of our critical plight. I have suggested a remedy which my judgment approves. I desire, however, to assure oongress that I am , pre-, pared to co-operate with them in per fecting any other measure promising thorough and praotioal relief, and -that I will gladly labor with them in every patriotic endeavor to further the. inter ests and guard the welfare of our coun trymen, whom, in our respective places of duty, we have undertaken to serve. , Gkover Cleveland.