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be exempt from discriminating duties, any such duties on merchandise imported into the United States in Spanish vessels, excepting from the islands of Cuba and Porto Rico, shall be discontinued and abolished.

plenipotentiary of His Majesty the king of and the islands adjacent thereto, in vessels Spain, that the Government of that country belonging to citizens of the United States shall has abolished discriminating duties heretofore imposed on merchandise imported from all other countries, excepting the islands of Cuba and Porto Rico, into Spain and the adjacent islands, in vessels of the United States, said abolition to take effect from and after the 1st day of January next:

Now, therefore, I, ULYSSES S. GRANT, President of the United States of America, by virtue of the authority vested in me by an act of Congress of the 7th day of January, 1824, and by an act in addition thereto, of the 24th day of May, 1828, do hereby declare and proclaim that on and after the said 1st day of January next, so long as merchandise imported from any other country, excepting the islands of Cuba and Porto Rico, into the ports of Spain

In testimony whereof I have hereunto set my hand, and caused the seal of the United State to be affixed.

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IV.

THIRD

PRESIDENT GRANT'S SECOND AND THIRD ANNUAL

MESSAGES.

[For his First Annual Message, see McPher It is not understood that the condition of son's History of Reconstruction, pages 533- the insurrection in Cuba has materially changed 540.] since the close of the last session of Congress. In an early stage of the contest the authorities President Grant's Second Annual Message. of Spain inaugurated a system of arbitrary

December 5, 1870.

arrests, of close confinement, and of military trial and execution of persons suspected of To the Senate and House of Representatives: complicity with the insurgents, and of sumA year of peace and general prosperity to mary embargo of their properties, and sequesthis nation has passed since the last assem-tration of their revenues by executive warrant. bling of Congress. We have, through a kind Providence, been blessed with abundant crops, and have been spared from complications and war with foreign nations. In our midst com parative harmony has been restored. It is to be regretted, however, that a free exercise of the elective franchise has, by violence and intimidation, been denied to citizens in exceptional cases in several of the States lately in rebellion, and the verdict of the people has thereby been reversed. The States of Virginia, Mississippi, and Texas have been restored to representation in our national councils. Georgia, the only State now without representation, may confidently be expected to take her place there also at the beginning of the new year; and then, let us hope, will be completed the work of reconstruction. With an acquiescence on the part of the whole people in the national obligation to pay the public debt, created as the price of our Union; the pensions to our disabled soldiers and sailors, and their widows and orphans; and in the changes to the Constitution which have been made necessary by a great rebellion, there is no reason why we should not advance in material prosperity and happiness, as no other nation ever did, after so protracted and devastating a war.

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Such proceedings, so far as they affected the persons or property of citizens of the United States, were in violation of the provisions of the treaty of 1795 between the United States and Spain. Representations of injuries re sulting to several persons claiming to be citizens of the United States, by reason of such violations, were made to the Spanish Government. From April 1869 to June last the Spanish minister at Washington had been clothed with a limited power to aid in redressing such wrongs. That power was found to be withdrawn, "in view," as it was said, "of the favorable situation in which the island of Cuba" then "was;" which, however, did not lead to a revocation or suspension of the extraordinary and arbitrary functions exercised by the executive power in Cuba, and we were obliged to make our complaints at Madrid. In the negotiations thus opened, and still pending there, the United States only claimed that, for the future, the rights secured to their cit izens by treaty should be respected in Cuba, and that, as to the past, a joint tribunal should be established in the United States, with full jurisdiction over all such claims. Before such an impartial tribunal each claimant would be required to prove his case. On the other hand, Spain would be at liberty to traverse

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of the products of northern farms and manufactories. The cheap rate at which her citizens can be furnished with food, tools, and machinery will make it necessary that contiguous islands should have the same advantages, in order to compete in the production of sugar, coffee, tobacco, tropical fruits, &c. This will open to us a still wider market for our products. The production of our own supply of dred millions of our annual imports, besides largely increasing our exports. With such a picture it is easy to see how our large debt abroad is ultimately to be extinguished. With a balance of trade against us (including interest on bonds held by foreigners and money spent by our citizens traveling in foreign lands) equal to the entire yield of the precious metals in this country it is not so easy to see how this result is to be otherwise accomplished.

During the last session of Congress a treaty for the annexation of the republic of San Domingo to the United States failed to receive the requisite two-thirds vote of the Senate. I was thoroughly convinced then that the best interests of this country, commercially and materially, demanded its ratification. Time has only confirmed me in this view. I these articles will cut off more than one hunnow firmly believe that the moment it is known that the United States have entirely abandoned the project of accepting, as a part of its territory, the island of San Domingo, a free port will be negotiated for by European nations in the Bay of Samana. A large commercial city will spring up, to which we will be tributary without receiving corresponding benefits, and then will be seen the folly of our rejecting so great a prize. The Government of San Domingo has voluntarily sought this annexation. It is a weak Power, numbering probably less than one hundred and twenty thousand souls, and yet possessing one of the richest territories under the sun, capable of supporting a population of ten millions of people in luxury. The people of San Domingo are not capable of maintaining themselves in their present condition, and must look for outside support. They yearn for the protection of our free institutions and laws; our progress and civilization. Shall we refuse them?

The acquisition of San Domingo is an adherence to the "Monroe doctrine;" it is a measure of national protection; it is asserting our just claim to a controlling influence over the great commercial traffic soon to flow from west to east, by way of the Isthmus of Darien ; it is to build up our merchant marine; it is to furnish new markets for the products of our farms, shops, and manufactories; it is to make slavery insupportable in Cuba and Porto Rico at once, and ultimately so in Brazil; it is to settle the unhappy condition of Cuba and end The acquisition of San Domingo is desirable an exterminating conflict; it is to provide because of its geographical position. It com honest means of paying our honest debts withmands the entrance to the Caribbean sea and out overtaxing the people; it is to furnish our the Isthmus transit of commerce. It possesses citizens with the necessaries of every-day life the richest soil, best and most capacious har- at cheaper rates than ever before; and it is, bors, most salubrious climate, and the most in fine, a rapid stride toward that greatness valuable products of the forest, mine, and soil which the intelligence, industry, and enterof any of the West India islands. Its posses-prise of the citizens of the United States entitle sion by us will in a few years build up a coast- this country to assume among nations. wise commerce of immense magnitude, which In view of the importance of this question will go far toward restoring to us our lost merchant marine. It will give to us those articles which we consume so largely and do not produce, thus equalizing our exports and imports. In case of foreign war it will give us command of all the islands referred to, and thus prevent an enemy from ever again possessing himself of rendezvous upon our very coast. At present our coast trade between the States bordering on the Atlantic and those bordering on the Gulf of Mexico is cut into by the Bahamas and the Antilles. Twice we must, as it were, pass through foreign countries to get, by sea, from Georgia, to the west coast of Florida.

I earnestly urge upon Congress early action, expressive of its views as to the best means of acquiring San Domingo. My suggestion is that, by joint resolution of the two Houses of Congress, the Executive be authorized to appoint a commission to negotiate a treaty with the authorities of San Domingo for the acquisition of that island, and that an appropriation be made to defray the expenses of such commission. The question may then be determined, either by the action of the Senate upon the treaty or the joint action of the two Houses of Congress, upon a resolution of annexation, as in the case of the acquisition of Texas. So convinced am I of the advantages to flow from the acquisition of San Domingo, and of the great disadvantages, I might almost say calamities, to flow from non-acquisition, that I believe the subject has only to be investigated to be approved.

San Domingo, with a stable government, under which her immense resources can be developed, will give remunerative wages to tens of thousands of laborers not now upon the island. This labor will take advantage of every available means of transportation to It is to be regretted that our representations abandon the adjacent islands and seek the in regard to the injurious effects, especially blessings of freedom and its sequence, each upon the revenue of the United States, of the inhabitant receiving the reward of his own policy of the Mexican Government, in exemptlabor. Porto Rico and Cuba will have to ing from impost duties a large tract of its terabolish slavery, as a measure of self-preserva-ritory on our borders, have not only been tion, to retain their laborers.

fruitless, but that it is even proposed in that

San Domingo will become a large consumer country, to extend the limits within which the

privilege adverted to has hitherto been en-thorities toward the fishermen of the United joyed. The expediency of taking into your serious consideration proper measures for countervailing the policy referred to will, it is presumed, engage your earnest attention.

States during the past season has not been marked by a friendly feeling. By the first article of the convention of 1818, between Great Britain and the United States, it was The massacres of French and Russian res- agreed that the inhabitants of the United idents at Tien-Tsin, under circumstances of States should have forever, in common with great barbarity, were supposed by some to British subjects, the right of taking fish in have been premeditated, and to indicate a pur- certain waters therein defined. In the waters pose among the populace to exterminate for- not included in the limits named in the coneigners in the Chinese empire. The evidence vention (within three miles of parts of the fails to establish such a supposition, but shows British coast) it has been the custom for many a complicity between the local authorities and years to give to intruding fishermen of the the mob. The Government at Pekin, how- United States a reasonable warning of their ever, seems to have been disposed to fulfill its violation of the technical rights of Great treaty obligations so far as it was able to do so. Britain. The imperial Government is underUnfortunately, the news of the war between stood to have delegated the whole or a share the German States and France reached China of its jurisdiction or control of these in-shore soon after the massacre. It would appear fishing grounds to the colonial authority known that the popular mind became possessed with as the Dominion of Canada, and this semithe idea that this contest, extending to Chi- independent but irresponsible agent has exernese waters, would neutralize the Christian cised its delegated powers in an unfriendly influence and power, and that the time was way. Vessels have been seized without notice coming when the superstitious masses might or warning, in violation of the custom preexpel all foreigners and restore mandarin in-viously prevailing, and have been taken into fluence. Anticipating trouble from this cause the colonial ports, their voyages broken up, I invited France and North Germany to make and the vessels condemned. an authorized suspension of hostilities in the There is reason to believe that this unfriendly East, (where they were temporarily suspended and vexatious treatment was designed to bear by act of the commanders,) and to act together harshly upon the hardy fishermen of the Unifor the future protection, in China, of the lives ted States, with a view to political effect upon and properties of Americans and Europeans. this Government. The statutes of the DominSince the adjournment of Congress the rati-ion of Canada assume a still broader and more fications of the treaty with Great Britain for untenable jurisdiction over the vessels of the abolishing the mixed courts for the suppression of the slave trade, have been exchanged. It is believed that the slave trade is now confined to the eastern coast of Africa, whence the slaves are taken to Arabian markets.

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I regret to say that no conclusion has been reached for the adjustment of the claims against Great Britain growing out of the course adopted by that Government during the rebellion. The cabinet of London, so far as its views have been expressed, does not appear to be willing to concede that her Majesty's Government was guilty of any negligence, or did or permitted any act during the war, by which the United States has just cause of complaint. Our firm and unalterable convictions are directly the reverse. I therefore recommend to Congress to authorize the appointment of a commission to take proof of the amounts, and the ownership of these several claims, on notice to the representative of her Majesty at Washington, and that authority be given for the settlement of these claims by the United States, so that the Government shall have the ownership of the private claims, as well as the responsible control of all the demands against Great Britain. It cannot be necessary to add that, whenever her Majesty's Government shall entertain a desire for a full and friendly adjustment of these claims, the United States will enter upon their consideration with an earnest desire for a conclusion consistent with the honor and dignity of both nations.

The course pursued by the Canadian au

United States. They authorize officers or persons to bring vessels hovering within three marine miles of any of the coasts, bays, creeks, or harbors of Canada into port, to search the cargo, to examine the master on oath touching the cargo and voyage, and to inflict upon him a heavy pecuniary penalty if true answers are not given; and if such a vessel is found " preparing to fish" within three marine miles of any of such coasts, bays, creeks, or harbors without a license, or after the expiration of the period named in the last license granted to it, they provide that the vessel, with her tackle, &c., shall be forfeited. It is not known that any condemnations have been made under this statute. Should the authorities of Canada attempt to enforce it, it will become my duty to take such steps as may be necessary to protect the rights of the citizens of the United States.

It has been claimed by her Majesty's officers that the fishing-vessels of the United States have no right to enter the open ports of the British possessions in North America, except for the purposes of shelter and repairing damages, of purchasing wood, and obtaining water; that they have no right to enter at the British custom-houses or to trade there except in the purchase of wood and water; and that they must depart within twenty-four hours after notice to leave. It is not known that any seizure of a fishing-vessel carrying the flag of the United States has been made under this claim. So far as the claim is founded on an alleged construction of the convention of 1818 it cannot be acquiesced in by the United States.

It is hoped that it will not be insisted on by her Majesty's Government.

During the conferences which preceded the negotiation of the convention of 1818 the British commissioners proposed to expressly exclude the fishermen of the United States from "the privilege of carrying on trade with any of his Britannic Majesty's subjects residing within the limits assigned for their use;" and also that it should not be "lawful for the vessels of the United States, engaged in said fishery, to have on board any goods, wares, or merchandise whatever, except such as may be necessary for the prosecution of their voyages to and from the said fishing grounds. And any vessel of the United States which shall contravene this regulation may be seized, condemned, and confiscated with her cargo." This proposition, which is identical with the construction now put upon the language of the convention, was emphatically rejected by the American commissioners, and thereupon was abandoned by the British plenipotentiaries, and article one, as it stands in the convention, was substituted.

If, however, it be said that this claim is founded on provincial or colonial statutes, and not upon the convention, this Government cannot but regard them as unfriendly, and in contravention of the spirit, if not of the let ter of the treaty, for the faithful execution of which the imperial Government is alone responsible.

Anticipating that an attempt may possibly be made by the Canadian authorities in the coming season to repeat their unneighborly acts toward our fishermen, I recommend you to confer upon the Executive the power to suspend, by proclamation, the operation of the laws authorizing the transit of goods, wares, and merchandise in bond across the territory of the United States to Canada; and further, should such an extreme measure become necessary, to suspend the operation of any laws whereby the vessels of the Dominion of Canada are permitted to enter the waters of the United States.

During the administration of Mr. John Quincy Adams, Mr. Clay unanswerably demonstrated the natural right of the citizens of the United States to the navigation of this river, claiming that the act of the congress of Vienna, in opening the Rhine and other rivers to all nations, showed the judgment of European jurists and statesmen that the inhabitants of a country through which a navigable river passes have a natural right to enjoy the navigation of that river to and into the sea, even though passing through the territories of another Power. This right does not exclude the coequal right of the sovereign possessing the territory through which the river debouches into the sea to make such regulations relative to the police of the navigation as may be reasonably necessary; but those regulations should be framed in a liberal spirit of comity, and should not impose needless burdens upon the commerce which has the right of transit. It has been found in practice more advantageous to arrange these regulations by mutual agreement. The United States are ready to make any reasonable arrangement as to the police of the St. Lawrence which may be suggested by Great Britain.

If the claim made by Mr. Clay was just when the population of States bordering on the shores of the lakes was only three million four hundred thousand, it now derives greater force and equity from the increased population, wealth, production, and tonnage of the States on the Canadian frontier. Since Mr. Clay advanced his argument in behalf of our right the principle for which he contended has been frequently, and by various nations, recognized by law or by treaty, and has been extended to several other great rivers. By the treaty concluded at Mayence, in 1831, the Rhine was declared free from the point where it is first navigable into the sea. By the convention between Spain and Portugal, concluded in 1835, the navigation of the Douro, throughout its whole extent, was made free for the subjects of both crowns. In 1853 the Argentine Confederation by treaty threw open the free A like unfriendly disposition has been mani- navigation of the Parana and the Uruguay to fested on the part of Canada in the maintenance the merchant vessels of all nations. In 1856 of a claim of right to exclude the citizens of the Crimean war was closed by a treaty which the United States from the navigation of the provided for the free navigation of the Danube. St. Lawrence. This river constitutes a natural In 1858 Bolivia, by treaty, declared that it reoutlet to the ocean for eight States with an garded the rivers Amazon and La Plata, in aggregate population of about seventeen million accordance with fixed principles of national six hundred thousand inhabitants, and with an law, as highways or channels opened by naaggregate tonnage of six hundred and sixty-ture for the commerce of all nations. In one thousand three hundred and sixty-seven tons upon the waters which discharge into it. The foreign commerce of our ports on these waters is open to British competition, and the major part of it is done in British bottoms.

If the American seamen be excluded from this natural avenue to the ocean, the monop oly of the direct commerce of the lake ports with the Atlantic would be in foreign hands; their vessels on transatlantic voyages having an access to our lake ports which would be denied to American vessels on similar voyages. To state such a proposition is to refute its justice..

1859 the Paraguay was made free by treaty, and in December 1866 the Emperor of Brazil, by imperial decree, declared the Amazon to be open, to the frontier of Brazil, to the merchant ships of all nations.

The greatest living British authority on this subject, while asserting the abstract right of the British claim, says: "It seems difficult to deny that Great Britain may ground her refusal upon strict law, but it is equally difficult to deny, first, that in so doing she exercises harshly an extreme and hard law; secondly, that her conduct with respect to the navigation of the St. Lawrence is in glaring and dis

creditable inconsistency with her conduct with respect to the navigation of the Mississippi. On the ground that she possessed a small domain, in which the Mississippi took its rise, she insisted on the right to navigate the entire volume of its waters. On the ground that she possesses both banks of the St. Lawrence, where it disembogues itself into the sea, she denies to the United States the right of navi gation, though about one half of the waters of Lakes Ontario, Erie, Huron, and Superior, and the whole of Lake Michigan, through which the river flows, are the property of the United States.' 99

The whole nation is interested in securing cheap transportation from the agricultural States of the West to the Atlantic sea-board. To the citizens of those States it secures a greater return for their labor; to the inhabitants of the sea-board it affords cheaper food; to the nation an increase in the annual surplus of wealth. It is hoped that the Government of Great Britain will see the justice of abandoning the narrow and inconsistent claim to which her Canadian provinces have urged her

adherence.

The average value of gold as compared with national currency, for the whole of the year 1869, was about one hundred and thirty-four, and for eleven months of 1870, the same relative value has been about one hundred and fifteen. The approach to a specie basis is very gratifying, but the fact cannot be denied that the instability of the value of our currency is prejudicial to our prosperity, and tends to keep up prices to the detriment of trade. The evils of a depreciated and fluctuating currency are so great that now, when the premium on gold has fallen so much, it would seem that the time has arrived when, by wise and prudent legislation, Congress should look to a policy which would place our currency at par with gold at no distant day.

The tax collected from the people has been reduced more than eighty million of dollars per annum. By steadiness in our present course there is no reason why, in a few short years, the national tax-gatherer may not disappear from the door of the citizen almost entirely. With the revenue stamp dispensed by postmasters in every community, a tax upon liquors of all sorts, and tobacco in all its forms, Our depressed commerce is a subject to and by a wise adjustment of the tariff, which which I called your special attention at the will put a duty only upon those articles which last session, and suggested that we will in the we could dispense with, known as luxuries, future have to look more to the countries and on those which we use more of than we south of us, and to China and Japan, for its produce, revenue enough may be raised, after revival. Our representatives to all these Gov-a few years of peace and consequent reducernments have exerted their influence to en- tion of indebtedness, to fulfill all our obligacourage trade between the United States and tions. A further reduction of expenses, in the countries to which they are accredited. But the fact exists that the carrying is done almost entirely in foreign bottoms, and while this state of affairs exists we cannot control our due share of the commerce of the world. That between the Pacific States and China and Japan is about all the carrying trade now conducted in American vessels. I would recom. mend a liberal policy toward that line of Amer-revenue reform, and confidently believe the ican steamers, one that will insure its success, and even increased usefulness.

The cost of building iron vessels, the only ones that can compete with foreign ships in the carrying trade, is so much greater in the United States than in foreign countries that, without some assistance from the Government, they cannot be successfully built here. There will be several propositions laid before Congress in the course of the present session looking to a remedy for this evil. Even if it should be at some cost to the national Treasury, I hope such encouragement will be given as will secure American shipping on the high seas and American ship building at home.

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addition to a reduction of interest account, may be relied on to make this practicable. Revenue reform, if it means this, has my hearty support. If it implies a collection of all the revenue for the support of Government, for the payment of principal and interest of the public debt, pensions, &c., by directly taxing the people, then I am against

people are with me. If it means failure to provide the necessary means to defray all the expenses of Government, and thereby repudiation of the public debt and pensions, then I am still more opposed to such kind of revenue reform. Revenue reform has not been defined by any of its advocates, to my knowl edge, but seems to be accepted as something which is to supply every man's wants without any cost or effort on his part.

A true revenue reform cannot be made in a day, but must be the work of national legislation and of time. As soon as the revenue can be dispensed with, all duty should be removed from coffee, tea, and other articles of universal use not produced by ourselves. The ne The estimates for the expenses of the Gov- cessities of the country compel us to collect ernment for the next fiscal year are $18,244,- revenue from our imports. An army of as346 01 less than for the current one, hut ex-sessors and collectors is not a pleasant sight to ceed the appropriations for the present year, the citizen, but that or a tariff for revenue for the same items, $8,972,127 56. In this is necessary. Such a tariff, so far as it acts estimate, however, is included $22,338,278 37 as an encouragement to home production, for public works heretofore begun under congressional provision, and of which only so much is asked as Congress may choose to give. The appropriation for the same works for the present fiscal year was $11,984,518 08.

affords employment to labor at living wages, in contrast to the pauper labor of the Old World, and also in the development of home resources.

Under the act of Congress of the 15th day

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