Year: 1874

hence high prices, acting as protection


to the foreign producer, who receive


nothing in exchange for the product O


his skill and labor, except currenc,


good at a stable value the world over


1t seems to me that nothing is cleare


than that the greater part of the burdel


of the existing prostration, for the wan


of sound financial system, falls upoI


the working man, who must, after all


produce the wealth, and on the salariet


man who superintends and conducts tn,


business. The burden falls upon then


in two ways-by the deprivation of EN-


ployment, and by the decreased purchas


ing power of their salaries. 1t is thu


duty of Congress to devise the method


of correcting the evils which are acknowl


edged to exist, and not mine; but will


venture to suggest two or three thing.


which seem to me as absolutely necessary


to return to specie payments. The first


great requisite is a return to prosperity


The legal tender clause to the law, au


thorizing the issue of currency by the


National Government should be repealed


to take effect as to all contracts entered


into after a day fixed in the repeating


act; not to apply, however, to the pay


ment of salaries by the Government, OF


other expenses, now provided by law, to


be paid in currency. In the interval


pending between repeal and final re-


sumption, provision should be made by


which the Secretary of the Treasury can


obtain gold as it may become necessary,


from time to time, from the date when
specie resumption is commenced. To
this might and should be added revenue
sufficiently in excess of expenses, to in
sure an accumulation of gold in the
Treasury to sustain redemption. i COM
mend this subject to your careful con-
sideration, believing that a favorable
solution is attainable, and that, if reached
by this Congress, that the present and
future generations will ever gratefully
remember it as their deliverance from
thraldom of evil and disgrace. With
mption, free banking may be author
lied with safety, giving full protection to
bill-holders, which they have under the
existing laws. Indeed l would regard
free banking as essential. 1t would give
a proper elasticity to the currency. AS
more currency should be required for the
transaction of legitimate business, new
banks would be started; and, in turn,
banks would wind up their business
when it was found that there was super
abundance of currency. The experience
and judgment of the people can best de-
eide Just how much currency is required
for the transaction of the business of the
country. It's unsafe to leave the settle
ment of this question to Congress, the
Secretary of the Treasury, or the Exec
utive. Congress should make the reg
ulations under which banks may exist,
but should not make banking monopoly,
by limiting the amount of redeemable
paper currency that shall be authorized.
Such importance do attach to this sub
ject, and so earnestly do commend it to
your attention, that I give it prominence
by introducing it at the beginning Of this



During the past year nothing has oc-
Cured to disturb the general friendly
and cordial relations of the United States
with other powers. The correspondence,
submitted herewith, between this Gov
ernment and its diplomatic representa-
tives of other countries, are satisfactory
as to the condition of all questions be-
tween the United States and the most
of those countries; and with few excep-
tions, to which reference is hereafter
made, the absence of any points of differ
ence to be adjusted. The notice directed,
by the resolution of Congress, of June IL,
1874, to be given to terminate the Con-
vention of July II, 1858, between the
United States and Belgium, has been
given, and the treaty will accordingly
terminate on the first day of July, 1875.
This convention secured to certain Bel
gian vessels entering the ports of the
United States exceptional privileges,
which are not accorded to our own yes
sells. Other features of the Convention
have proved satisfactory, and have
tended to the cultivation of mutually
beneficial commercial intercourse and
relations between the two cOun-
tries. l hope that the negotiations which
have been invited will result in the cele-
bration of another treaty which may
tend to the benefit of both countries.


Our relations with China continue to
be friendly. During the past year, the
fear of hostilities between China and
Japan, growing out of the landing of an
armed force upon the Island of Formosa
by the latter, has occasioned uneasiness.
It is earnestly hoped, however, that the
difficulties arising from this cause Will
be adjusted, and that the advance OF
civilization in these two empires may not
be retarded by state of war. In con-
sequence of the part taken by certain
citizens of the United States in this ex-
pedition, our representatives in these
countries have been instructed to impress
upon the Governments of China and
Japan the firm intention of this country
10 maintain a strict neutrality in the
event of hostilities, and carefully prevent
any infraction of the law on the part OF
our citizens. In connection with this
subject, call the attention of Congress
to generally conceded fact, that the
great proportion of Chinese immigrants,
who come to our shore, do not come
to make their homes with us,
and their labor productive OF general
but come under contract
with head men who own them almost
in a worse form does this
apply to Chinese women. Hardly
perceptible per cent. of them perform any
honorable labor, but they are brought for
shameful purposes to the disgrace of the
communities were settled, to the great
decentralization of the youth of those
localities. If this bad practice can be
legislated against, it will be my pleasure as
well as my duty to enforce any regulation
to secure 70 desirable an end.


It is hoped that negotiations between
the Government of Japan and the other
powers, looking to the further opening of
the Empire, and to the removal Of various
restrictions upon trade and travel, may
soon produce the results desired, which
can not fail to inure to the benefit of all
parties. Having on previous occasions
submitted to the consideration of Con-
gress the propriety Of the release of the
Japanese Government from the further
payment of indemnity, under the Con-
vention of October %, 1864, and as no
action had been taken therein, It became
my duty to regard the obligations of the
Convention az in force; and as the other
powers interested having received their
nort;on of the Indemnity i'm full. the