A treaty of commerce has been concluded between the United States and the Oriental Republic of Uruguay, which will be laid before the Senate. Should this convention go into operation, it will open to the commercial enterprise of our citizens a country of great extent and unsurpassed in natural resources, but from which foreign nations have hitherto been almost wholly excluded.
The correspondence of the late Secretary of State with the Peruvian chargé d'affaires relative to the Lobos Islands was communicated to Congress toward the close of the last session. Since that time, on further investigation of the subject, the doubts which had been entertained of the title of Peru to those islands have been removed, and I have deemed it just that the temporary wrong which had been unintentionally done her from want of information should be repaired by an unreserved acknowledgment of her sovereignty.
I have the satisfaction to inform you that the course pursued by Peru has been creditable to the liberality of her Government. Before it was known by her that her title would be acknowledged at Washington, her minister of foreign affairs had authorized our chargé d'affaires at Lima to announce to the American vessels which had gone to the Lobos for guano that the Peruvian Government was willing to freight them on its own account. This intention has been carried into effect by the Peruvian minister here by an arrangement which is believed to be advantageous to the parties in interest.
Our settlements on the shores of the Pacific have already given a great extension, and in some respects a new direction, to our commerce in that ocean. A direct and rapidly increasing intercourse has sprung up with eastern Asia. The waters of the Northern Pacific, even into the Arctic Sea, have of late years been frequented by our whalemen. The application of steam to the general purposes of navigation is becoming daily more common, and makes it desirable to obtain fuel and other necessary supplies at convenient points on the route between Asia and our Pacific shores. Our unfortunate countrymen who from time to time suffer shipwreck on the coasts of the eastern seas are entitled to protection. Besides these specific objects, the general prosperity of our States on the Pacific requires that an attempt should be made to open the opposite regions of Asia to a mutually beneficial intercourse. It is obvious that this attempt could be made by no power to so great advantage as by the United States, whose constitutional system excludes every idea of distant colonial dependencies. I have accordingly been led to order an appropriate naval force to Japan, under the command of a discreet and intelligent officer of the highest rank known to our service. He is instructed to endeavor to obtain from the Government of that country some relaxation of the inhospitable and antisocial system which it has pursued for about two centuries. He has been directed particularly to remonstrate in the strongest language against the cruel treatment to which our shipwrecked mariners have often been subjected and to insist that they shall be treated with humanity. He is instructed, however, at the same time, to give that Government the amplest assurances that the objects of the United States are such, and such only, as I have indicated, and that the expedition is friendly and peaceful. Notwithstanding the jealousy with which the Governments of eastern Asia regard all overtures from foreigners, I am not without hopes of a beneficial result of the expedition. Should it be crowned with success, the advantages will not be confined to the United States, but, as in the case of China, will be equally enjoyed by all the other maritime powers. I have much satisfaction in stating that in all the steps preparatory to this expedition the Government of the United States has been materially aided by the good offices of the King of the Netherlands, the only European power having any commercial relations with Japan.
In passing from this survey of our foreign relations, I invite the attention of Congress to the condition of that Department of the Government to which this branch of the public business is intrusted. Our intercourse with foreign powers has of late years greatly increased, both in consequence of our own growth and the introduction of many new states into the family of nations. In this way the Department of State has become overburdened. It has by the recent establishment of the Department of the Interior been relieved of some portion of the domestic business. If the residue of the business of that kind—such as the distribution of Congressional documents, the keeping, publishing, and distribution of the laws of the United States, the execution of the copyright law, the subject of reprieves and pardons, and some other subjects relating to interior administration—should be transferred from the Department of State, it would unquestionably be for the benefit of the public service. I would also suggest that the building appropriated to the State Department is not fireproof; that there is reason to think there are defects in its construction, and that the archives of the Government in charge of the Department, with the precious collections of the manuscript papers of Washington, Jefferson, Hamilton, Madison, and Monroe, are exposed to destruction by fire. A similar remark may be made of the buildings appropriated to the War and Navy Departments.
The condition of the Treasury is exhibited in the annual report from that Department.
The cash receipts into the Treasury for the fiscal year ending the 30th June last, exclusive of trust funds, were $49,728,386.89, and the expenditures for the same period, likewise exclusive of trust funds, were $46,007,896.20, of which $9,455,815.83 was on account of the principal and interest of the public debt, including the last installment of the indemnity to Mexico under the treaty of Guadalupe Hidalgo, leaving a balance of $14,632,136.37 in the Treasury on the 1st day of July last. Since this latter period further purchases of the principal of the public debt have been made to the extent of $2,456,547.49, and the surplus in the Treasury will continue to be applied to that object whenever the stock can be procured within the limits as to price authorized by law.
The value of foreign merchandise imported during the last fiscal year was $207,240,101, and the value of domestic productions exported was $149,861,911, besides $17,204,026 of foreign merchandise exported, making the aggregate of the entire exports $167,065,937. Exclusive of the above, there was exported $42,507,285 in specie, and imported from foreign ports $5,262,643.
In my first annual message to Congress I called your attention to what seemed to me some defects in the present tariff, and recommended such modifications as in my judgment were best adapted to remedy its evils and promote the prosperity of the country. Nothing has since occurred to change my views on this important question.
Without repeating the arguments contained in my former message in favor of discriminating protective duties, I deem it my duty to call your attention to one or two other considerations affecting this subject. The first is the effect of large importations of foreign goods upon our currency. Most of the gold of California, as fast as it is coined, finds its way directly to Europe in payment for goods purchased. In the second place, as our manufacturing establishments are broken down by competition with foreigners, the capital invested in them is lost, thousands of honest and industrious citizens are thrown out of employment, and the farmer, to that extent, is deprived of a home market for the sale of his surplus produce. In the third place, the destruction of our manufactures leaves the foreigner without competition in our market, and he consequently raises the price of the article sent here for sale, as is now seen in the increased cost of iron imported from England. The prosperity and wealth of every nation must depend upon its productive industry. The farmer is stimulated to exertion by finding a ready market for his surplus products, and benefited by being able to exchange them without loss of time or expense of transportation for the manufactures which his comfort or convenience requires. This is always done to the best advantage where a portion of the community in which he lives is engaged in other pursuits. But most manufactures require an amount of capital and a practical skill which can not be commanded unless they be protected for a time from ruinous competition from abroad. Hence the necessity of laying those duties upon imported goods which the Constitution authorizes for revenue in such a manner as to protect and encourage the labor of our own citizens. Duties, however, should not be fixed at a rate so high as to exclude the foreign article, but should be so graduated as to enable the domestic manufacturer fairly to compete with the foreigner in our own markets, and by this competition to reduce the price of the manufactured article to the consumer to the lowest rate at which it can be produced. This policy would place the mechanic by the side of the farmer, create a mutual interchange of their respective commodities, and thus stimulate the industry of the whole country and render us independent of foreign nations for the supplies required by the habits or necessities of the people.