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Show AT PEACE WIT1ULL 1TI01S President Taf t Sends in Special Message Reviewing Our Relations With Other Countries. Important General Movement for Broader Arbitration On Part of Powers is Noted Mexican War Discussed Dis-cussed Merchant Marine Needed. there may be an appeal to tne propose court from the decisions of national courts, has received the signature oi the governments parties to the original convention and has been ratified by the government of the United Slates, together togeth-er with the prize court convention. The deposit of the ratifications with the government of the Netherlands awaits action by the powers on the declaration, dec-laration, signed at London on February 26, 1009, of the rules of International law to be recognized within the meaning of article seven of The Hague convention for the establishment of an International prize court. Fur-Seal Treaty. The fur-seal controversy, which for nearly twenty-five vars "has been the source of serious friction between the United States and the lowers bordering upon the north Pacific ocean, whose subjects sub-jects have been permitted to engage In pelagic sealing against the fur-seal nerds having their breeding grounds within the Jurisdiction of the United States, has at last been satisfactorily adjusted by the conclusion of the North Pacific Bealing convention entered Into between the United States, Great Britain, Japan and Russia on the seventh of July last. The attention of congress is especially called to the necessity for legislation on the part of the United States for the purpose pur-pose of fulfilling the obligations assumed under this convention, to which the senate sen-ate gave Its advice and consent on the twenty-fourth day of July last. International Opium Commission. In a special message transmitted to the congress on the seventh of January, 1911, in which I concurred in the recommendations recommenda-tions made by the secretary of state In regard to certain needful legislation for the control of our interstate and foreign traffic in opium and other menacing drugs, I quoted from my annual message mes-sage of December 7, 1909, In which I announced an-nounced that the results of the International Interna-tional Opium commission held at Shanghai Shang-hai In February, 1909, at the Invitation of the United States, had been laid before this government: that the report of that commission showed that China was making mak-ing remarkable progress and admirable efforts toward the eradication of the opium evil; that the interested governments govern-ments had not permitted their commercial commer-cial interests to prevent their co-operation In this reform; and, as a result of callateral investigations of the opium question in this country, I recommended that the manufacture, sale and use of opium in the United States should be more rigorously controlled by legislation. Prior to that time and in continuation of the policy of this government to secure se-cure the co-operation of the interested nations, the United States proposed an international opium conference with full powers for the purpose of clothing with the force of International law the resolutions reso-lutions adopted by the above-mentioned commission, together with their essential essen-tial corollories. The other powers concerned con-cerned cordially responded to the proposal pro-posal of this government, and, I am glad to be able to announce, representatives of all the powers assembled in conference at The Hague on the first of this month. Foreign Trade Relations of the United States. In my last annual message I referred to the tariff negotiations of the department depart-ment of state with foreign countries in connection with the application, by a series se-ries of proclamations, of the minimum tariff of the United States to importations importa-tions from the several countries, and I stated that, in its general operation, section sec-tion 2 of the new tariff law had proved a guaranty of coritlnued commercial peace, although there were, unfortunately. unfortunate-ly. Instances where foreign governments dealt arbitrarily with American Interests within their jurisdiction in a manner injurious in-jurious and inequitable. During the past year some Instances of discriminatory treatment have been removed, but I regret re-gret to say that there remain a few cases of differential treatment adverse to ' the commerce of the United States. While none of these Instances now appenrs to amount to undue discrimination In the sense of section 2 of the tariff law of August 5. 1909, they are all exceptions to that complete degree of equality of tariff tar-iff treatment that the department of state has consistently sought to obtain for American commerce abroad. "While the double tariff feature of the tariff law of 1909 has been amply justified justi-fied by the results achieved in removing former and preventing new, undue discriminations dis-criminations against American commerce, It is believed that the time has come for the amendment of this feature of the law in such way as to provide & graduated means of meeting varying degrees of discriminatory treatment of American commerce in foreign countries as well as to protect the financial Interests abroad of American citizens against arbitrary and injurious treatment on the part of foreign governments through either legislative leg-islative or administrative measures. It would seem desirable that the maximum maxi-mum tariff of the United States should embrace within Its purview the free list, which is not the case at the present time. In order that It might have reasonable significance to the governments of those countries from which the Importations Into the United States are confined virtually vir-tually to articles on the free list. The fiscal year ended June 30. 1911. shows great progress in the development of American trade. It was noteworthy as marking the highest record of exports of American products to foreign countries, coun-tries, the valuation being in excess of J2. ooo, COO. 000. These exports showed a gain over the preceding year of more than $300,000,000. Crying Need for American Merchant Marine. I need hardly reiterate the conviction that there should speedily be built up an American merchant marine. This is necessary nec-essary to assure favorable transportation transporta-tion facilities to our great ocean-borne commerce as well as to supplement the navy with an adequate reserve of ships and men. It would have the economic advantage ad-vantage of keeping at home part of the vast sums now paid foreign shipping for carrying American goods. AH the great .commercial nations pay heavy subsidies to their merchant marine, so that it Is obvious that without some wise aid from the congress the United States must lag behind In the matter of merchant marine In its present anomalous position. "Legislation to facllitato the extension of American banks to foreign countries Is another matter in which our foreign trade needs assistance. Improvement of the Foreign Service. The entire foreign-service organization Is being improved and developed with especial regard to the requirements of the commercial Interests of the country. The rapid growth of our foreign trade makes it of the utmost Importance that governmental agencies through which that trade Is to be aided and protected should possess a high degree of efficiency. effi-ciency. Not only should the foreign representatives rep-resentatives be maintained upon a generous gen-erous scale In so far as salaries and establishments es-tablishments are concerned, but the selection se-lection and advancement of officers should be definitely and permanently regulated reg-ulated by law, so that the service shall not fall to attract men of high character and ability. The experience of the past few years with a partial application of civil service rules to the dipulomatlc and consular service leaves no doubt In my mind of the wisdom of a wider and more permanent extension of those principles to both branches of the foreign service. I therefore again commend to the favorable fa-vorable action of the congress the enactment enact-ment of a law applying to the diplomatic and consular service the principles emv bodied In section 1753 of the Revised Statutes Stat-utes of the United States. In the civil service act of January 16, 18S3. and the executive orders of June 27. 1306. and o November 26. 1909. Washington, Dec. 7. The first of President Presi-dent Taft's promised special messages was read In corujress today. It deals entirely en-tirely with foreign affairs. The message in part follows: The relations of the United States with other countries have continued during the :past twelve months upon a basis of the usual good will and friendly intercourse. Arbitration. The year just passed marks an Important Im-portant general movement on the part of the powers for broader arbitration. In the recognition of the manifold benefits to mankind in the extension of the policy of the settlement of international disputes dis-putes by arbitration rather than by war, and In response to a widespread demand for an advance in that direction on the part of the people of the United States and of Great Britain and of France, new arbitration treaties were negotiated last spring with Great Britain and France, the terms of which were designed, as expressed In the preamble of these treat-lea, treat-lea, to extend the scope and obligations of the policy of arbitration adopted in our present treaties with those governments. To pave the way for this treaty with the United States, Great Britain negotiated an important modification in Its alliance with Japan and the French government also expedited the negotiations with signal sig-nal good will. The new treaties have been submitted to the senate and are awaiting Its advice and consent to their ratification. All the essentials of these important treaties have long been known, and It is my earnest hope that they will receive prompt and favorable action. Claim of Alsop & Co. Settled. I am glad to report that on July 6 last "the American claim of Alsop & Co. against the government of Chile was finally disposed of by the decision of his Britannic majesty George V., to whom, as amiable compositeur, the matter had been referred for determination. His majesty made an award of nearly $1,000,- 000 to the claimants, which was promptly paid by Chile. The settlement of this controversy has happily eliminated from the relations between the republic of Chile and the United States the only question which for two decades had given giv-en the two foreign offices any serious concern and makes possible the unobstructed unob-structed development of the relations of friendship which it has been the aim of this government in every possible way to further and cultivate. Arbitrations. In further Illustration of the practical and beneficent application of the, principle princi-ple of arbitration and the underlying broad spirit of conciliation, I am happy to advert to the part of the United States in faciliating amicable settlement of disputes dis-putes which menaced the peace between Panama and Costa Rica and between Haiti and the Dominican republic. Since the date of their independence, Colombia and Costa Rica had been seeking seek-ing a solution of a boundary dispute, which came as a heritage from Colombia to the new .republic of Panama, upon its beginning life as an independent nation. na-tion. In January, 1910. at the request of both governments the agents representing represent-ing them met in conference at the department depart-ment of state and subsequently concluded conclud-ed a protocol submitting this long-pending controversy to the arbitral Judgment of the chief justice of the United States, who consented to act In this capacity. A boundary commission, according to the International agreement, has now been appointed, and It Is expected that the ar-Kuments ar-Kuments will shortly proceed and that this long-standing dispute will be honorably honor-ably and satisfactorily terminated. Again, a few months ago it appeared that the Dominican republic and Haiti were about to enter upon hostilities because be-cause of complications growing out of an acrimonious boundary dispute which the efforts of manv years had failed to solve. - " The government of the United States, by a friendly interposition of good offices, succeeded in prevailing upon the parties to place their reliance upon some form of pacific settlement. Mexico. The recent political events In Mexico received attention from this government because of the exceedingly delicate and difficult situation created along our southern south-ern border and the necessity for taking measures properly to safeguard American Ameri-can interests. The government of the United States, in its desire to secure a proper observance and enforcement of the so-called neutrality statutes of tb" federal government, issued directions to the appropriate officers to exercise a diligent dili-gent and vlfcilam regard for the requirements require-ments of such rules and laws. Although a condition, of actual armed conflict existed, ex-isted, there was no official recognition of belligerency Involving the technical neutrality neu-trality obligations of international law. On the 6th of March last, In the absence ab-sence of the secretary of state, I had a personal Interview with Mr. Wilson, the ambassador of the United States to Mexico. Mex-ico. In which he reported to nie that the conditions In Mexico were much more critical than the press dispatches disclosed: dis-closed: that President Diaz was on a volcano vol-cano of popular uprising: that the small outbreaks which had occurred were only symptomatic of the whole condition; that a very large per cent, of the people were in sympathy with the insurrection; that a general explosion was probable at any time, In which case he feared that the 440.000 or more American residents In Mulco might be assailed, and that the ver large American Investments might be Injured or destroyed. After a conference with the secretary of war and the secretary of the navy, I thought it wise to a.lsemble an army division of full strength at San Antonio, Tex., a brigade of three regiments at Galveston, a brigade of infantry in tb , Los Angeles district of southern California, Cali-fornia, together with a squadron of battleships bat-tleships and cruisers and transports at Galveston, and a small squadron of ships at San Diego. At the same time, through our representative at the City of Mexico 1 expressed to President Diaz the hope that no apwwhenslons might result from unfounded "conjectures as to these military mili-tary maneuvers, and assured him that they had no significance which should cause concert: to his government. 1 am more than nappy to here record the fact that all apprehensions as to the effect of the presence of so large a military mili-tary force In Texas proved groundless; no disturbances occurred. From time to time communications were received from Ambassador Wilson, who had returned to Mexico, confirming the view that the massing of American troops In the neighborhood had had good effect. The Insurrection continued and resulted In engagements between the regular Mexican troops and the Insurgents, and this along the border, so that in several instances bullets from the contending forces struck American citizens engaged In their lawful occupations on American soil. Proper protests were made against these Invasions of American rights to the Mexican authorities. The presence of a large military and naval force available for prompt action, near the Mexican border, proved to be the most fortunate under the somewhat trying conditions presented by this Invasion Inva-sion of American rights. The policy and action of this government govern-ment were based upon an earnest friendliness friend-liness for the Mexican people as a whole, and it is a matter of gratification to note that this attitude of strict impartiality as to all factions in Mexico and of sincere friendship for the neighboring nation, without regard for party allegiance, has been generally recognised and has resulted re-sulted In an even closer and more sympathetic sym-pathetic understanding between the two republics and a warmer regard one for the other. Action to suppress violence and restore tranquility throughout the Mexican republic was of peculiar interest inter-est to this government, in that it concerned con-cerned the safeguarding of American life and property in that country. On May 2s, 1911, President Diaz resigned, Senor de la Barra was chosen provisional president. presi-dent. Elections for president and vice-president vice-president were thereafter held throughout through-out the republic, and Senor Francisco I. Madero was formally declared elected on October 15, to the chief magistracy. On November 6 President Madero entered upon the duties of his office. Honduras and Nicaragua Treaties Proposed. As to the situation In Central America, I have taken occasion in the past to emphasize em-phasize most strongly the importance that should be attributed to the consummation consumma-tion of the conventions between the republics re-publics of Nicaragua and of Honduras and this country, and I again earnestly recommend that the necessary advice and consent of the senate be accorded to these treaties, which will rpake It possible possi-ble for these Central American republics repub-lics to enter upon an era pf genuine economic eco-nomic national development. Our relations with the Republic of Panama, peculiarly Important, due to mutual mu-tual obligations and the vast Interests created by the canal, have continued in the usual friendly manner, and we have been glad to make appropriate expression expres-sion of our attitude of sympathetic interest in-terest In the endeavors of our neighbor in undertaking the development of the rich resources of the country. The Chinese Loans. The past year has been marked In our relations, with China by the conclusion of two important international loans, one for the construction of the Hukuang railways, rail-ways, the other for the carrying out of the currency reform to which China was pledged, by treaties with the United States, Great Britain and Japan, of which mention was made In my last annual an-nual message. . . Especially important at the present, when the ancient Chinese empire Is shaken shak-en by civil war Incidental to its awakening awaken-ing to the many influences and activity of moderlzatlon, are the co-operative policy pol-icy of good understanding which has been , fostered by the international projects referred re-ferred to above and the general sympathy sym-pathy of view among all the powers interested in-terested In the far east. New Japanese Treaty. The treaty of commerce and navigation between the United States and Japan, sljrned In 1894. would by a strict interpretation inter-pretation of its provisions have termlnat-edx termlnat-edx on July 17, 1912. Japan's general 'reaties with the other powers, however, Terminated in 1911, and the Japanese government gov-ernment expressed an earnest desire to conduct the negotiations for a new treaty wirh the United States simultaneously with l's negotiations with the other powers. pow-ers. There were a number of Important questions involved in the treaty, includ-ini; includ-ini; the Immigration of laborers, revision of the customs tariff and the right of Vruricans to hold real estate In Japan. The United States consented to waive all technicalities and to enter at once upon nrgntlations for a new treaty on the un-'li un-'li rstnnding that there should be a con-ti'iunnce con-ti'iunnce throughout the life of the treaty of the same effective measures for the r'S!riet;on of Immigration of laborers to American territory which had been In operation with entire satisfaction to both governments since 1908. The Japanese government accepted this basis of negotiation, nego-tiation, and a new treaty was quickly concluded, resulting In a highly satisfactory satisfac-tory settlement of the other questions referred re-ferred to. Europe and the Near East. In Europe and the near east, during the past twelve-month, there has been at times considerable political unrest. The Moroccan question, which for some months was the cause of great anxiety, happily appears to have reached a stage at which it need no longer be regarded with concern. The Ottoman empire was occupied for a period by strife in Albania Al-bania and Is now at war with Italy. In Greece and the Balkan countries the disquieting potentialities of this situation have been more or less felt. Persia has been the scene of a long internal struggle. strug-gle. These conditions have been the cause of uneasiness In European diplomacy, diplo-macy, but thus far without direct political politi-cal concern to the United States. In the war which unhappily exists between be-tween Italy and Turkey this government has no direct political interest, and I took occasion at the suitable time to ia-oue ia-oue a proclamation of neutrality in that conflict. At the same time all necessary steps have been taken to safeguard the personal interests of American citizens and organizations In so far as affected by the war. In spite of the attendant economic uncertainties un-certainties and detriments to commerce, the United States has gained markedly In its commercial standing with certain of the nations of the near east. International Conventions and Conferences. Confer-ences. The supplementary protocol to The Hague convention for the establishment of an International prize court, mentioned in my last annual message, embodying stipulations providing for an alternative procudure which would remove .the constitutional con-stitutional objection to that part of The Hague convention which provides that |