Speech Transcript:

 To the Senate and House of Representatives:

FINANCES.

The financial standing of the Nation at the present time is
excellent, and the financial management of the Nation's interests by
the Government during the last seven years has shown the most
satisfactory results. But our currency system is imperfect, and it is
earnestly to be hoped that the Currency Commission will be able to
propose a thoroughly good system which will do away with the existing
defects.

During the period from July 1, 1901, to September 30, 1908, there was
an increase in the amount of money in circulation of $902,991,399. The
increase in the per capita during this period was $7.06. Within this
time there were several occasions when it was necessary for the
Treasury Department to come to the relief of the money market by
purchases or redemptions of United States bonds; by increasing
deposits in national banks; by stimulating additional issues of
national bank notes, and by facilitating importations from abroad of
gold. Our imperfect currency system has made these proceedings
necessary, and they were effective until the monetary disturbance in
the fall of 1907 immensely increased the difficulty of ordinary
methods of relief. By the middle of November the available working
balance in the Treasury had been reduced to approximately $5,000,000.
Clearing house associations throughout the country had been obliged to
resort to the expedient of issuing clearing house certificates, to be
used as money. In this emergency it was determined to invite
subscriptions for $50,000,000 Panama Canal bonds, and $100,000,000
three per cent certificates of indebtedness authorized by the act of
June 13, 1898. It was proposed to re-deposit in the national banks
the proceeds of these issues, and to permit their use as a basis for
additional circulating notes of national banks. The moral effect of
this procedure was so great that it was necessary to issue only
$24,631,980 of the Panama Canal bonds and $15,436,500 of the
certificates of indebtedness.

During the period from July 1, 1901, to September 30, 1908, the
balance between the net ordinary receipts and the net ordinary
expenses of the Government showed a surplus in the four years 1902,
1903, 1906 and 1907, and a deficit in the years 1904, 1905, 1908 and
a fractional part of the fiscal year 1909. The net result was a
surplus of $99,283,413.54. The financial operations of the Government
during this period, based upon these differences between receipts and
expenditures, resulted in a net reduction of the interest-bearing
debt of the United States from $987,141,040 to $897,253,990,
notwithstanding that there had been two sales of Panama Canal bonds
amounting in the aggregate to $54,631,980, and an issue of three per
cent certificates of indebtedness under the act of June 13, 1998,
amounting to $15,436,500. Refunding operations of the Treasury
Department under the act of March 14, 1900, resulted in the
conversion into two per cent consols of 1930 of $200,309,400 bonds
bearing higher rates of interest. A decrease of $8,687,956 in the
annual interest charge resulted from these operations.

In short, during the seven years and three months there has been a
net surplus of nearly one hundred millions of receipts over
expenditures, a reduction of the interest-bearing debt by ninety
millions, in spite of the extraordinary expense of the Panama Canal,
and a saving of nearly nine millions on the annual interest charge.
This is an exceedingly satisfactory showing, especially in view of
the fact that during this period the Nation has never hesitated to
undertake any expenditure that it regarded as necessary. There have
been no new taxes and no increase of taxes; on the contrary, some
taxes have been taken off; there has been a reduction of taxation.

CORPORATIONS.

As regards the great corporations engaged in interstate business, and
especially the railroad, I can only repeat what I have already again
and again said in my messages to the Congress, I believe that under
the interstate clause of the Constitution the United States has
complete and paramount right to control all agencies of interstate
commerce, and I believe that the National Government alone can
exercise this right with wisdom and effectiveness so as both to
secure justice from, and to do justice to, the great corporations
which are the most important factors in modern business. I believe
that it is worse than folly to attempt to prohibit all combinations
as is done by the Sherman anti-trust law, because such a law can be
enforced only imperfectly and unequally, and its enforcement works
almost as much hardship as good. I strongly advocate that instead of
an unwise effort to prohibit all combinations there shall be
substituted a law which shall expressly permit combinations which are
in the interest of the public, but shall at the same time give to some
agency of the National Government full power of control and
supervision over them. One of the chief features of this control
should be securing entire publicity in all matters which the public
has a right to know, and furthermore, the power, not by judicial but
by executive action, to prevent or put a stop to every form of
improper favoritism or other wrongdoing.

The railways of the country should be put completely under the
Interstate Commerce Commission and removed from the domain of the
anti-trust law. The power of the Commission should be made
thoroughgoing, so that it could exercise complete supervision and
control over the issue of securities as well as over the raising and
lowering of rates. As regards rates, at least, this power should be
summary. The power to investigate the financial operations and
accounts of the railways has been one of the most valuable features
in recent legislation. Power to make combinations and traffic
agreements should be explicitly conferred upon the railroads, the
permission of the Commission being first gained and the combination
or agreement being published in all its details. In the interest of
the public the representatives of the public should have complete
power to see that the railroads do their duty by the public, and as a
matter of course this power should also be exercised so as to see that
no injustice is done to the railroads. The shareholders, the employees
and the shippers all have interests that must be guarded. It is to the
interest of all of them that no swindling stock speculation should be
allowed, and that there should be no improper issuance of securities.
The guiding intelligences necessary for the successful building and
successful management of railroads should receive ample remuneration;
but no man should be allowed to make money in connection with
railroads out of fraudulent over-capitalization and kindred
stock-gambling performances; there must be no defrauding of
investors, oppression of the farmers and business men who ship
freight, or callous disregard of the rights and needs of the
employees. In addition to this the interests of the shareholders, of
the employees, and of the shippers should all be guarded as against
one another. To give any one of them undue and improper consideration
is to do injustice to the others. Rates must be made as low as is
compatible with giving proper returns to all the employees of the
railroad, from the highest to the lowest, and proper returns to the
shareholders; but they must not, for instance, be reduced in such
fashion as to necessitate a cut in the wages of the employees or the
abolition of the proper and legitimate profits of honest
shareholders.

Telegraph and telephone companies engaged in interstate business
should be put under the jurisdiction of the Interstate Commerce
Commission.

It is very earnestly to be wished that our people, through their
representatives, should act in this matter. It is hard to say whether
most damage to the country at large would come from entire failure on
the part of the public to supervise and control the actions of the
great corporations, or from the exercise of the necessary
governmental power in a way which would do injustice and wrong to the
corporations. Both the preachers of an unrestricted individualism, and
the preachers of an oppression which would deny to able men of
business the just reward of their initiative and business sagacity,
are advocating policies that would be fraught with the gravest harm
to the whole country. To permit every lawless capitalist, every
law-defying corporation, to take any action, no matter how
iniquitous, in the effort to secure an improper profit and to build
up privilege, would be ruinous to the Republic and would mark the
abandonment of the effort to secure in the industrial world the
spirit of democratic fair dealing. On the other hand, to attack these
wrongs in that spirit of demagogy which can see wrong only when
committed by the man of wealth, and is dumb and blind in the presence
of wrong committed against men of property or by men of no property,
is exactly as evil as corruptly to defend the wrongdoing of men of
wealth. The war we wage must be waged against misconduct, against
wrongdoing wherever it is found; and we must stand heartily for the
rights of every decent man, whether he be a man of great wealth or a
man who earns his livelihood as a wage-worker or a tiller of the
soil.

It is to the interest of all of us that there should be a premium put
upon individual initiative and individual capacity, and an ample
reward for the great directing intelligences alone competent to
manage the great business operations of to-day. It is well to keep in
mind that exactly as the anarchist is the worst enemy of liberty and
the reactionary the worst enemy of order, so the men who defend the
rights of property have most to fear from the wrongdoers of great
wealth, and the men who are championing popular rights have most to
fear from the demagogues who in the name of popular rights would do
wrong to and oppress honest business men, honest men of wealth; for
the success of either type of wrongdoer necessarily invites a violent
reaction against the cause the wrongdoer nominally upholds. In point
of danger to the Nation there is nothing to choose between on the one
hand the corruptionist, the bribe-giver, the bribe-taker, the man who
employs his great talent to swindle his fellow-citizens on a large
scale, and, on the other hand, the preacher of class hatred, the man
who, whether from ignorance or from willingness to sacrifice his
country to his ambition, persuades well-meaning but wrong-headed men
to try to destroy the instruments upon which our prosperity mainly
rests. Let each group of men beware of and guard against the
shortcomings to which that group is itself most liable. Too often we
see the business community in a spirit of unhealthy class
consciousness deplore the effort to hold to account under the law the
wealthy men who in their management of great corporations, whether
railroads, street railways, or other industrial enterprises, have
behaved in a way that revolts the conscience of the plain, decent
people. Such an attitude can not be condemned too severely, for men
of property should recognize that they jeopardize the rights of
property when they fail heartily to join in the effort to do away
with the abuses of wealth. On the other hand, those who advocate
proper control on behalf of the public, through the State, of these
great corporations, and of the wealth engaged on a giant scale in
business operations, must ever keep in mind that unless they do
scrupulous justice to the corporation, unless they permit ample
profit, and cordially encourage capable men of business so long as
they act with honesty, they are striking at the root of our national
well-being; for in the long run, under the mere pressure of material
distress, the people as a whole would probably go back to the reign
of an unrestricted individualism rather than submit to a control by
the State so drastic and so foolish, conceived in a spirit of such
unreasonable and narrow hostility to wealth, as to prevent business
operations from being profitable, and therefore to bring ruin upon
the entire business community, and ultimately upon the entire body of
citizens.

The opposition to Government control of these great corporations
makes its most effective effort in the shape of an appeal to the old
doctrine of State's rights. Of course there are many sincere men who
now believe in unrestricted individualism in business, just as there
were formerly many sincere men who believed in slavery--that is, in
the unrestricted right of an individual to own another individual.
These men do not by themselves have great weight, however. The
effective fight against adequate Government control and supervision
of individual, and especially of corporate, wealth engaged in
interstate business is chiefly done under cover; and especially under
cover of an appeal to State's rights. It is not at all infrequent to
read in the same speech a denunciation of predatory wealth fostered
by special privilege and defiant of both the public welfare and law
of the land, and a denunciation of centralization in the Central
Government of the power to deal with this centralized and organized
wealth. Of course the policy set forth in such twin denunciations
amounts to absolutely nothing, for the first half is nullified by the
second half. The chief reason, among the many sound and compelling
reasons, that led to the formation of the National Government was the
absolute need that the Union, and not the several States, should deal
with interstate and foreign commerce; and the power to deal with
interstate commerce was granted absolutely and plenarily to the
Central Government and was exercised completely as regards the only
instruments of interstate commerce known in those days--the
waterways, the highroads, as well as the partnerships of individuals
who then conducted all of what business there was. Interstate
commerce is now chiefly conducted by railroads; and the great
corporation has supplanted the mass of small partnerships or
individuals. The proposal to make the National Government supreme
over, and therefore to give it complete control over, the railroads
and other instruments of interstate commerce is merely a proposal to
carry out to the letter one of the prime purposes, if not the prime
purpose, for which the Constitution was rounded. It does not
represent centralization. It represents merely the acknowledgment of
the patent fact that centralization has already come in business. If
this irresponsible outside business power is to be controlled in the
interest of the general public it can only be controlled in one
way--by giving adequate power of control to the one sovereignty
capable of exercising such power--the National Government. Forty or
fifty separate state governments can not exercise that power over
corporations doing business in most or all of them; first, because
they absolutely lack the authority to deal with interstate business
in any form; and second, because of the inevitable conflict of
authority sure to arise in the effort to enforce different kinds of
state regulation, often inconsistent with one another and sometimes
oppressive in themselves. Such divided authority can not regulate
commerce with wisdom and effect. The Central Government is the only
power which, without oppression, can nevertheless thoroughly and
adequately control and supervise the large corporations. To abandon
the effort for National control means to abandon the effort for all
adequate control and yet to render likely continual bursts of action
by State legislatures, which can not achieve the purpose sought for,
but which can do a great deal of damage to the corporation without
conferring any real benefit on the public.

I believe that the more farsighted corporations are themselves coming
to recognize the unwisdom of the violent hostility they have displayed
during the last few years to regulation and control by the National
Government of combinations engaged in interstate business. The truth
is that we who believe in this movement of asserting and exercising a
genuine control, in the public interest, over these great corporations
have to contend against two sets of enemies, who, though nominally
opposed to one another, are really allies in preventing a proper
solution of the problem. There are, first, the big corporation men,
and the extreme individualists among business men, who genuinely
believe in utterly unregulated business that is, in the reign of
plutocracy; and, second, the men who, being blind to the economic
movements of the day, believe in a movement of repression rather than
of regulation of corporations, and who denounce both the power of the
railroads and the exercise of the Federal power which alone can
really control the railroads. Those who believe in efficient national
control, on the other hand, do not in the least object to
combinations; do not in the least object to concentration in business
administration. On the contrary, they favor both, with the all
important proviso that there shall be such publicity about their
workings, and such thoroughgoing control over them, as to insure
their being in the interest, and not against the interest, of the
general public. We do not object to the concentration of wealth and
administration; but we do believe in the distribution of the wealth
in profits to the real owners, and in securing to the public the full
benefit of the concentrated administration. We believe that with
concentration in administration there can come both be advantage of a
larger ownership and of a more equitable distribution of profits, and
at the same time a better service to the commonwealth. We believe
that the administration should be for the benefit of the many; and
that greed and rascality, practiced on a large scale, should be
punished as relentlessly as if practiced on a small scale.

We do not for a moment believe that the problem will be solved by any
short and easy method. The solution will come only by pressing various
concurrent remedies. Some of these remedies must lie outside the
domain of all government. Some must lie outside the domain of the
Federal Government. But there is legislation which the Federal
Government alone can enact and which is absolutely vital in order to
secure the attainment of our purpose. Many laws are needed. There
should be regulation by the National Government of the great
interstate corporations, including a simple method of account
keeping, publicity, supervision of the issue securities, abolition of
rebates, and of special privileges. There should be short time
franchises for all corporations engaged in public business; including
the corporations which get power from water rights. There should be
National as well as State guardianship of mines and forests. The
labor legislation hereinafter referred to should concurrently be
enacted into law.

To accomplish this, means of course a certain increase in the use
of--not the creation of--power, by the Central Government. The power
already exists; it does not have to be created; the only question is
whether it shall be used or left idle--and meanwhile the corporations
over which the power ought to be exercised will not remain idle. Let
those who object to this increase in the use of the only power
available, the national power, be frank, and admit openly that they
propose to abandon any effort to control the great business
corporations and to exercise supervision over the accumulation and
distribution of wealth; for such supervision and control can only
come through this particular kind of increase of power. We no more
believe in that empiricism which demand, absolutely unrestrained
individualism than we do in that empiricism which clamors for a
deadening socialism which would destroy all individual initiative and
would ruin the country with a completeness that not even an
unrestrained individualism itself could achieve. The danger to
American democracy lies not in the least in the concentration of
administrative power in responsible and accountable hands. It lies in
having the power insufficiently concentrated, so that no one can be
held responsible to the people for its use. Concentrated power is
palpable, visible, responsible, easily reached, quickly held to
account. Power scattered through many administrators, many
legislators, many men who work behind and through legislators and
administrators, is impalpable, is unseen, is irresponsible, can not
be reached, can not be held to account. Democracy is in peril
wherever the administration of political power is scattered among a
variety of men who work in secret, whose very names are unknown to
the common people. It is not in peril from any man who derives
authority from the people, who exercises it in sight of the people,
and who is from time to time compelled to give an account of its
exercise to the people.

LABOR.

There are many matters affecting labor and the status of the
wage-worker to which I should like to draw your attention, but an
exhaustive discussion of the problem in all its aspects is not now
necessary. This administration is nearing its end; and, moreover,
under our form of government the solution of the problem depends upon
the action of the States as much as upon the action of the Nation.
Nevertheless, there are certain considerations which I wish to set
before you, because I hope that our people will more and more keep
them in mind. A blind and ignorant resistance to every effort for the
reform of abuses and for the readjustment of society to modern
industrial conditions represents not true conservatism, but an
incitement to the wildest radicalism; for wise radicalism and wise
conservatism go hand in hand, one bent on progress, the other bent on
seeing that no change is made unless in the right direction. I believe
in a steady effort, or perhaps it would be more accurate to say in
steady efforts in many different directions, to bring about a
condition of affairs under which the men who work with hand or with
brain, the laborers, the superintendents, the men who produce for the
market and the men who find a market for the articles produced, shall
own a far greater share than at present of the wealth they produce,
and be enabled to invest it in the tools and instruments by which all
work is carried on. As far as possible I hope to see a frank
recognition of the advantages conferred by machinery, organization,
and division of labor, accompanied by an effort to bring about a
larger share in the ownership by wage-worker of railway, mill and
factory. In farming, this simply means that we wish to see the farmer
own his own land; we do not wish to see the farms so large that they
become the property of absentee landlords who farm them by tenants,
nor yet so small that the farmer becomes like a European peasant.
Again, the depositors in our savings banks now number over one-tenth
of our entire population. These are all capitalists, who through the
savings banks loan their money to the workers--that is, in many cases
to themselves--to carry on their various industries. The more we
increase their number, the more we introduce the principles of
cooperation into our industry. Every increase in the number of small
stockholders in corporations is a good thing, for the same reasons;
and where the employees are the stockholders the result is
particularly good. Very much of this movement must be outside of
anything that can be accomplished by legislation; but legislation can
do a good deal. Postal savings banks will make it easy for the poorest
to keep their savings in absolute safety. The regulation of the
national highways must be such that they shall serve all people with
equal justice. Corporate finances must be supervised so as to make it
far safer than at present for the man of small means to invest his
money in stocks. There must be prohibition of child labor, diminution
of woman labor, shortening of hours of all mechanical labor; stock
watering should be prohibited, and stock gambling so far as is
possible discouraged. There should be a progressive inheritance tax
on large fortunes. Industrial education should be encouraged. As far
as possible we should lighten the burden of taxation on the small
man. We should put a premium upon thrift, hard work, and business
energy; but these qualities cease to be the main factors in
accumulating a fortune long before that fortune reaches a point where
it would be seriously affected by any inheritance tax such as I
propose. It is eminently right that the Nation should fix the terms
upon which the great fortunes are inherited. They rarely do good and
they often do harm to those who inherit them in their entirety.

PROTECTION FOR WAGEWORKERS.

The above is the merest sketch, hardly even a sketch in outline, of
the reforms for which we should work. But there is one matter with
which the Congress should deal at this session. There should no
longer be any paltering with the question of taking care of the
wage-workers who, under our present industrial system, become killed,
crippled, or worn out as part of the regular incidents of a given
business. The majority of wageworkers must have their rights secured
for them by State action; but the National Government should
legislate in thoroughgoing and far-reaching fashion not only for all
employees of the National Government, but for all persons engaged in
interstate commerce. The object sought for could be achieved to a
measurable degree, as far as those killed or crippled are concerned,
by proper employers' liability laws. As far as concerns those who
have been worn out, I call your attention to the fact that definite
steps toward providing old-age pensions have been taken in many of
our private industries. These may be indefinitely extended through
voluntary association and contributory schemes, or through the agency
of savings banks, as under the recent Massachusetts plan. To
strengthen these practical measures should be our immediate duty; it
is not at present necessary to consider the larger and more general
governmental schemes that most European governments have found
themselves obliged to adopt.

Our present system, or rather no system, works dreadful wrong, and is
of benefit to only one class of people--the lawyers. When a workman is
injured what he needs is not an expensive and doubtful lawsuit, but
the certainty of relief through immediate administrative action. The
number of accidents which result in the death or crippling of
wageworkers, in the Union at large, is simply appalling; in a very
few years it runs up a total far in excess of the aggregate of the
dead and wounded in any modern war. No academic theory about "freedom
of contract" or "constitutional liberty to contract" should be
permitted to interfere with this and similar movements. Progress in
civilization has everywhere meant a limitation and regulation of
contract. I call your especial attention to the bulletin of the
Bureau of Labor which gives a statement of the methods of treating
the unemployed in European countries, as this is a subject which in
Germany, for instance, is treated in connection with making provision
for worn-out and crippled workmen.

Pending a thoroughgoing investigation and action there is certain
legislation which should be enacted at once. The law, passed at the
last session of the Congress, granting compensation to certain
classes of employees of the Government, should be extended to include
all employees of the Government and should be made more liberal in its
terms. There is no good ground for the distinction made in the law
between those engaged in hazardous occupations and those not so
engaged. If a man is injured or killed in any line of work, it was
hazardous in his case. Whether 1 per cent or 10 per cent of those
following a given occupation actually suffer injury or death ought
not to have any bearing on the question of their receiving
compensation. It is a grim logic which says to an injured employee or
to the dependents of one killed that he or they are entitled to no
compensation because very few people other than he have been injured
or killed in that occupation. Perhaps one of the most striking
omissions in the law is that it does not embrace peace officers and
others whose lives may be sacrificed in enforcing the laws of the
United States. The terms of the act providing compensation should be
made more liberal than in the present act. A year's compensation is
not adequate for a wage-earner's family in the event of his death by
accident in the course of his employment. And in the event of death
occurring, say, ten or eleven months after the accident, the family
would only receive as compensation the equivalent of one or two
months' earnings. In this respect the generosity of the United States
towards its employees compares most unfavorably with that of every
country in Europe--even the poorest.

The terms of the act are also a hardship in prohibiting payment in
cases where the accident is in any way due to the negligence of the
employee. It is inevitable that daily familiarity with danger will
lead men to take chances that can be construed into negligence. So
well is this recognized that in practically all countries in the
civilized world, except the United States, only a great degree of
negligence acts as a bar to securing compensation. Probably in no
other respect is our legislation, both State and National, so far
behind practically the entire civilized world as in the matter of
liability and compensation for accidents in industry. It is
humiliating that at European international congresses on accidents
the United States should be singled out as the most belated among the
nations in respect to employers' liability legislation. This
Government is itself a large employer of labor, and in its dealings
with its employees it should set a standard in this country which
would place it on a par with the most progressive countries in
Europe. The laws of the United States in this respect and the laws of
European countries have been summarized in a recent Bulletin of the
Bureau of Labor, and no American who reads this summary can fail to
be struck by the great contrast between our practices and theirs--a
contrast not in any sense to our credit.

The Congress should without further delay pass a model employers'
liability law for the District of Columbia. The employers' liability
act recently declared unconstitutional, on account of apparently
including in its provisions employees engaged in intrastate commerce
as well as those engaged in interstate commerce, has been held by the
local courts to be still in effect so far as its provisions apply to
District of Columbia. There should be no ambiguity on this point. If
there is any doubt on the subject, the law should be reenacted with
special reference to the District of Columbia. This act, however,
applies only to employees of common carriers. In all other
occupations the liability law of the District is the old common law.
The severity and injustice of the common law in this matter has been
in some degree or another modified in the majority of our States, and
the only jurisdiction under the exclusive control of the Congress
should be ahead and not behind the States of the Union in this
respect. A comprehensive employers' liability law should be passed
for the District of Columbia.

I renew my recommendation made in a previous message that
half-holidays be granted during summer to all wageworkers in
Government employ.

I also renew my recommendation that the principle of the eight-hour
day should as rapidly and as far as practicable be extended to the
entire work being carried on by the Government; the present law
should be amended to embrace contracts on those public works which
the present wording of the act seems to exclude.

THE COURTS.

I most earnestly urge upon the Congress the duty of increasing the
totally inadequate salaries now given to our Judges. On the whole
there is no body of public servants who do as valuable work, nor
whose moneyed reward is so inadequate compared to their work.
Beginning with the Supreme Court, the Judges should have their
salaries doubled. It is not befitting the dignity of the Nation that
its most honored public servants should be paid sums so small
compared to what they would earn in private life that the performance
of public service by them implies an exceedingly heavy pecuniary
sacrifice.

It is earnestly to be desired that some method should be devised for
doing away with the long delays which now obtain in the
administration of justice, and which operate with peculiar severity
against persons of small means, and favor only the very criminals
whom it is most desirable to punish. These long delays in the final
decisions of cases make in the aggregate a crying evil; and a remedy
should be devised. Much of this intolerable delay is due to improper
regard paid to technicalities which are a mere hindrance to justice.
In some noted recent cases this over-regard for technicalities has
resulted in a striking denial of justice, and flagrant wrong to the
body politic.

At the last election certain leaders of organized labor made a
violent and sweeping attack upon the entire judiciary of the country,
an attack couched in such terms as to include the most upright, honest
and broad-minded judges, no less than those of narrower mind and more
restricted outlook. It was the kind of attack admirably fitted to
prevent any successful attempt to reform abuses of the judiciary,
because it gave the champions of the unjust judge their eagerly
desired opportunity to shift their ground into a championship of just
judges who were unjustly assailed. Last year, before the House
Committee on the Judiciary, these same labor leaders formulated their
demands, specifying the bill that contained them, refusing all
compromise, stating they wished the principle of that bill or
nothing. They insisted on a provision that in a labor dispute no
injunction should issue except to protect a property right, and
specifically provided that the right to carry on business should not
be construed as a property right; and in a second provision their
bill made legal in a labor dispute any act or agreement by or between
two or more persons that would not have been unlawful if done by a
single person. In other words, this bill legalized blacklisting and
boycotting in every form, legalizing, for instance, those forms of
the secondary boycott which the anthracite coal strike commission so
unreservedly condemned; while the right to carry on a business was
explicitly taken out from under that protection which the law throws
over property. The demand was made that there should be trial by jury
in contempt cases, thereby most seriously impairing the authority of
the courts. All this represented a course of policy which, if carried
out, would mean the enthronement of class privilege in its crudest and
most brutal form, and the destruction of one of the most essential
functions of the judiciary in all civilized lands.

The violence of the crusade for this legislation, and its complete
failure, illustrate two truths which it is essential our people
should learn. In the first place, they ought to teach the workingman,
the laborer, the wageworker, that by demanding what is improper and
impossible he plays into the hands of his foes. Such a crude and
vicious attack upon the courts, even if it were temporarily
successful, would inevitably in the end cause a violent reaction and
would band the great mass of citizens together, forcing them to stand
by all the judges, competent and incompetent alike, rather than to see
the wheels of justice stopped. A movement of this kind can ultimately
result in nothing but damage to those in whose behalf it is nominally
undertaken. This is a most healthy truth, which it is wise for all our
people to learn. Any movement based on that class hatred which at
times assumes the name of "class consciousness" is certain ultimately
to fail, and if it temporarily succeeds, to do far-reaching damage.
"Class consciousness," where it is merely another name for the odious
vice of class selfishness, is equally noxious whether in an employer's
association or in a workingman's association. The movement in question
was one in which the appeal was made to all workingmen to vote
primarily, not as American citizens, but as individuals of a certain
class in society. Such an appeal in the first place revolts the more
high-minded and far-sighted among the persons to whom it is
addressed, and in the second place tends to arouse a strong
antagonism among all other classes of citizens, whom it therefore
tends to unite against the very organization on whose behalf it is
issued. The result is therefore unfortunate from every standpoint.
This healthy truth, by the way, will be learned by the socialists if
they ever succeed in establishing in this country an important
national party based on such class consciousness and selfish class
interest.

The wageworkers, the workingmen, the laboring men of the country, by
the way in which they repudiated the effort to get them to cast their
votes in response to an appeal to class hatred, have emphasized their
sound patriotism and Americanism. The whole country has cause to fell
pride in this attitude of sturdy independence, in this uncompromising
insistence upon acting simply as good citizens, as good Americans,
without regard to fancied--and improper--class interests. Such an
attitude is an object-lesson in good citizenship to the entire
nation.

But the extreme reactionaries, the persons who blind themselves to
the wrongs now and then committed by the courts on laboring men,
should also think seriously as to what such a movement as this
portends. The judges who have shown themselves able and willing
effectively to check the dishonest activity of the very rich man who
works iniquity by the mismanagement of corporations, who have shown
themselves alert to do justice to the wageworker, and sympathetic
with the needs of the mass of our people, so that the dweller in the
tenement houses, the man who practices a dangerous trade, the man who
is crushed by excessive hours of labor, feel that their needs are
understood by the courts--these judges are the real bulwark of the
courts; these judges, the judges of the stamp of the president-elect,
who have been fearless in opposing labor when it has gone wrong, but
fearless also in holding to strict account corporations that work
iniquity, and far-sighted in seeing that the workingman gets his
rights, are the men of all others to whom we owe it that the appeal
for such violent and mistaken legislation has fallen on deaf ears,
that the agitation for its passage proved to be without substantial
basis. The courts are jeopardized primarily by the action of those
Federal and State judges who show inability or unwillingness to put a
stop to the wrongdoing of very rich men under modern industrial
conditions, and inability or unwillingness to give relief to men of
small means or wageworkers who are crushed down by these modern
industrial conditions; who, in other words, fail to understand and
apply the needed remedies for the new wrongs produced by the new and
highly complex social and industrial civilization which has grown up
in the last half century.

The rapid changes in our social and industrial life which have
attended this rapid growth have made it necessary that, in applying
to concrete cases the great rule of right laid down in our
Constitution, there should be a full understanding and appreciation
of the new conditions to which the rules are to be applied. What
would have been an infringement upon liberty half a century ago may
be the necessary safeguard of liberty to-day. What would have been an
injury to property then may be necessary to the enjoyment of property
now. Every judicial decision involves two terms--one, as
interpretation of the law; the other, the understanding of the facts
to which it is to be applied. The great mass of our judicial officers
are, I believe, alive to those changes of conditions which so
materially affect the performance of their judicial duties. Our
judicial system is sound and effective at core, and it remains, and
must ever be maintained, as the safeguard of those principles of
liberty and justice which stand at the foundation of American
institutions; for, as Burke finely said, when liberty and justice are
separated, neither is safe. There are, however, some members of the
judicial body who have lagged behind in their understanding of these
great and vital changes in the body politic, whose minds have never
been opened to the new applications of the old principles made
necessary by the new conditions. Judges of this stamp do lasting harm
by their decisions, because they convince poor men in need of
protection that the courts of the land are profoundly ignorant of and
out of sympathy with their needs, and profoundly indifferent or
hostile to any proposed remedy. To such men it seems a cruel mockery
to have any court decide against them on the ground that it desires
to preserve "liberty" in a purely technical form, by withholding
liberty in any real and constructive sense. It is desirable that the
legislative body should possess, and wherever necessary exercise, the
power to determine whether in a given case employers and employees are
not on an equal footing, so that the necessities of the latter compel
them to submit to such exactions as to hours and conditions of labor
as unduly to tax their strength; and only mischief can result when
such determination is upset on the ground that there must be no
"interference with the liberty to contract"--often a merely academic
"liberty," the exercise of which is the negation of real liberty.

There are certain decisions by various courts which have been
exceedingly detrimental to the rights of wageworkers. This is true of
all the decisions that decide that men and women are, by the
Constitution, "guaranteed their liberty" to contract to enter a
dangerous occupation, or to work an undesirable or improper number of
hours, or to work in unhealthy surroundings; and therefore can not
recover damages when maimed in that occupation and can not be
forbidden to work what the legislature decides is an excessive number
of hours, or to carry on the work under conditions which the
legislature decides to be unhealthy. The most dangerous occupations
are often the poorest paid and those where the hours of work are
longest; and in many cases those who go into them are driven by
necessity so great that they have practically no alternative.
Decisions such as those alluded to above nullify the legislative
effort to protect the wage-workers who most need protection from
those employers who take advantage of their grinding need. They halt
or hamper the movement for securing better and more equitable
conditions of labor. The talk about preserving to the misery-hunted
beings who make contracts for such service their "liberty" to make
them, is either to speak in a spirit of heartless irony or else to
show an utter lack of knowledge of the conditions of life among the
great masses of our fellow-countrymen, a lack which unfits a judge to
do good service just as it would unfit any executive or legislative
officer.

There is also, I think, ground for the belief that substantial
injustice is often suffered by employees in consequence of the custom
of courts issuing temporary injunctions without notice to them, and
punishing them for contempt of court in instances where, as a matter
of fact, they have no knowledge of any proceedings. Outside of
organized labor there is a widespread feeling that this system often
works great injustice to wageworkers when their efforts to better
their working condition result in industrial disputes. A temporary
injunction procured ex parte may as a matter of fact have all the
effect of a permanent injunction in causing disaster to the
wageworkers' side in such a dispute. Organized labor is chafing under
the unjust restraint which comes from repeated resort to this plan of
procedure. Its discontent has been unwisely expressed, and often
improperly expressed, but there is a sound basis for it, and the
orderly and law-abiding people of a community would be in a far
stronger position for upholding the courts if the undoubtedly
existing abuses could be provided against.

Such proposals as those mentioned above as advocated by the extreme
labor leaders contain the vital error of being class legislation of
the most offensive kind, and even if enacted into law I believe that
the law would rightly be held unconstitutional. Moreover, the labor
people are themselves now beginning to invoke the use of the power of
injunction. During the last ten years, and within my own knowledge, at
least fifty injunctions have been obtained by labor unions in New York
City alone, most of them being to protect the union label (a "property
right"), but some being obtained for other reasons against employers.
The power of injunction is a great equitable remedy, which should on
no account be destroyed. But safeguards should be erected against its
abuse. I believe that some such provisions as those I advocated a year
ago for checking the abuse of the issuance of temporary injunctions
should be adopted. In substance, provision should be made that no
injunction or temporary restraining order issue otherwise than on
notice, except where irreparable injury would otherwise result; and
in such case a hearing on the merits of the order should be had
within a short fixed period, and, if not then continued after
hearing, it should forthwith lapse. Decisions should be rendered
immediately, and the chance of delay minimized in every way.
Moreover, I believe that the procedure should be sharply defined, and
the judge required minutely to state the particulars both of his
action and of his reasons therefor, so that the Congress can, if it
desires, examine and investigate the same.

The chief lawmakers in our country may be, and often are, the judges,
because they are the final seat of authority. Every time they
interpret contract, property, vested rights, due process of law,
liberty, they necessarily enact into law parts of a system of social
philosophy, and as such interpretation is fundamental, they give
direction to all law-making. The decisions of the courts on economic
and social questions depend upon their economic and social
philosophy; and for the peaceful progress of our people during the
twentieth century we shall owe most to those judges who hold to a
twentieth century economic and social philosophy and not to a long
outgrown philosophy, which was itself the product of primitive
economic conditions. Of course a judge's views on progressive social
philosophy are entirely second in importance to his possession of a
high and fine character; which means the possession of such
elementary virtues as honesty, courage, and fair-mindedness. The
judge who owes his election to pandering to demagogic sentiments or
class hatreds and prejudices, and the judge who owes either his
election or his appointment to the money or the favor of a great
corporation, are alike unworthy to sit on the bench, are alike
traitors to the people; and no profundity of legal learning, or
correctness of abstract conviction on questions of public policy, can
serve as an offset to such shortcomings. But it is also true that
judges, like executives and legislators, should hold sound views on
the questions of public policy which are of vital interest to the
people.

The legislators and executives are chosen to represent the people in
enacting and administering the laws. The judges are not chosen to
represent the people in this sense. Their function is to interpret
the laws. The legislators are responsible for the laws; the judges
for the spirit in which they interpret and enforce the laws. We stand
aloof from the reckless agitators who would make the judges mere
pliant tools of popular prejudice and passion; and we stand aloof
from those equally unwise partisans of reaction and privilege who
deny the proposition that, inasmuch as judges are chosen to serve the
interests of the whole people, they should strive to find out what
those interests are, and, so far as they conscientiously can, should
strive to give effect to popular conviction when deliberately and
duly expressed by the lawmaking body. The courts are to be highly
commended and staunchly upheld when they set their faces against
wrongdoing or tyranny by a majority; but they are to be blamed when
they fail to recognize under a government like ours the deliberate
judgment of the majority as to a matter of legitimate policy, when
duly expressed by the legislature. Such lawfully expressed and
deliberate judgment should be given effect by the courts, save in the
extreme and exceptional cases where there has been a clear violation
of a constitutional provision. Anything like frivolity or wantonness
in upsetting such clearly taken governmental action is a grave
offense against the Republic. To protest against tyranny, to protect
minorities from oppression, to nullify an act committed in a spasm of
popular fury, is to render a service to the Republic. But for the
courts to arrogate to themselves functions which properly belong to
the legislative bodies is all wrong, and in the end works mischief.
The people should not be permitted to pardon evil and slipshod
legislation on the theory that the court will set it right; they
should be taught that the right way to get rid of a bad law is to
have the legislature repeal it, and not to have the courts by
ingenious hair-splitting nullify it. A law may be unwise and
improper; but it should not for these reasons be declared
unconstitutional by a strained interpretation, for the result of such
action is to take away from the people at large their sense of
responsibility and ultimately to destroy their capacity for orderly
self restraint and self government. Under such a popular government
as ours, rounded on the theory that in the long run the will of the
people is supreme, the ultimate safety of the Nation can only rest in
training and guiding the people so that what they will shall be right,
and not in devising means to defeat their will by the technicalities
of strained construction.

For many of the shortcomings of justice in our country our people as
a whole are themselves to blame, and the judges and juries merely
bear their share together with the public as a whole. It is
discreditable to us as a people that there should be difficulty in
convicting murderers, or in bringing to justice men who as public
servants have been guilty of corruption, or who have profited by the
corruption of public servants. The result is equally unfortunate,
whether due to hairsplitting technicalities in the interpretation of
law by judges, to sentimentality and class consciousness on the part
of juries, or to hysteria and sensationalism in the daily press. For
much of this failure of justice no responsibility whatever lies on
rich men as such. We who make up the mass of the people can not shift
the responsibility from our own shoulders. But there is an important
part of the failure which has specially to do with inability to hold
to proper account men of wealth who behave badly.

The chief breakdown is in dealing with the new relations that arise
from the mutualism, the interdependence of our time. Every new social
relation begets a new type of wrongdoing--of sin, to use an
old-fashioned word--and many years always elapse before society is
able to turn this sin into crime which can be effectively punished at
law. During the lifetime of the older men now alive the social
relations have changed far more rapidly than in the preceding two
centuries. The immense growth of corporations, of business done by
associations, and the extreme strain and pressure of modern life,
have produced conditions which render the public confused as to who
its really dangerous foes are; and among the public servants who have
not only shared this confusion, but by some of their acts have
increased it, are certain judges. Marked inefficiency has been shown
in dealing with corporations and in re-settling the proper attitude
to be taken by the public not only towards corporations, but towards
labor and towards the social questions arising out of the factory
system and the enormous growth of our great cities.

The huge wealth that has been accumulated by a few individuals of
recent years, in what has amounted to a social and industrial
revolution, has been as regards some of these individuals made
possible only by the improper use of the modern corporation. A
certain type of modern corporation, with its officers and agents, its
many issues of securities, and its constant consolidation with allied
undertakings, finally becomes an instrument so complex as to contain
a greater number of elements that, under various judicial decisions,
lend themselves to fraud and oppression than any device yet evolved
in the human brain. Corporations are necessary instruments of modern
business. They have been permitted to become a menace largely because
the governmental representatives of the people have worked slowly in
providing for adequate control over them.

The chief offender in any given case may be an executive, a
legislature, or a judge. Every executive head who advises violent,
instead of gradual, action, or who advocates ill-considered and
sweeping measures of reform (especially if they are tainted with
vindictiveness and disregard for the rights of the minority) is
particularly blameworthy. The several legislatures are responsible
for the fact that our laws are often prepared with slovenly haste and
lack of consideration. Moreover, they are often prepared, and still
more frequently amended during passage, at the suggestion of the very
parties against whom they are afterwards enforced. Our great clusters
of corporations, huge trusts and fabulously wealthy
multi-millionaires, employ the very best lawyers they can obtain to
pick flaws in these statutes after their passage; but they also
employ a class of secret agents who seek, under the advice of
experts, to render hostile legislation innocuous by making it
unconstitutional, often through the insertion of what appear on their
face to be drastic and sweeping provisions against the interests of
the parties inspiring them; while the demagogues, the corrupt
creatures who introduce blackmailing schemes to "strike"
corporations, and all who demand extreme, and undesirably radical,
measures, show themselves to be the worst enemies of the very public
whose loud-mouthed champions they profess to be. A very striking
illustration of the consequences of carelessness in the preparation
of a statute was the employers' liability law of 1906. In the cases
arising under that law, four out of six courts of first instance held
it unconstitutional; six out of nine justices of the Supreme Court
held that its subject-matter was within the province of congressional
action; and four of the nine justices held it valid. It was, however,
adjudged unconstitutional by a bare majority of the court--five to
four. It was surely a very slovenly piece of work to frame the
legislation in such shape as to leave the question open at all.

Real damage has been done by the manifold and conflicting
interpretations of the interstate commerce law. Control over the
great corporations doing interstate business can be effective only if
it is vested with full power in an administrative department, a branch
of the Federal executive, carrying out a Federal law; it can never be
effective if a divided responsibility is left in both the States and
the Nation; it can never be effective if left in the hands of the
courts to be decided by lawsuits.

The courts hold a place of peculiar and deserved sanctity under our
form of government. Respect for the law is essential to the
permanence of our institutions; and respect for the law is largely
conditioned upon respect for the courts. It is an offense against the
Republic to say anything which can weaken this respect, save for the
gravest reason and in the most carefully guarded manner. Our judges
should be held in peculiar honor; and the duty of respectful and
truthful comment and criticism, which should be binding when we speak
of anybody, should be especially binding when we speak of them. On an
average they stand above any other servants of the community, and the
greatest judges have reached the high level held by those few greatest
patriots whom the whole country delights to honor. But we must face
the fact that there are wise and unwise judges, just as there are
wise and unwise executives and legislators. When a president or a
governor behaves improperly or unwisely, the remedy is easy, for his
term is short; the same is true with the legislator, although not to
the same degree, for he is one of many who belong to some given
legislative body, and it is therefore less easy to fix his personal
responsibility and hold him accountable therefor. With a judge, who,
being human, is also likely to err, but whose tenure is for life,
there is no similar way of holding him to responsibility. Under
ordinary conditions the only forms of pressure to which he is in any
way amenable are public opinion and the action of his fellow judges.
It is the last which is most immediately effective, and to which we
should look for the reform of abuses. Any remedy applied from without
is fraught with risk. It is far better, from every standpoint, that
the remedy should come from within. In no other nation in the world
do the courts wield such vast and far-reaching power as in the United
States. All that is necessary is that the courts as a whole should
exercise this power with the farsighted wisdom already shown by those
judges who scan the future while they act in the present. Let them
exercise this great power not only honestly and bravely, but with
wise insight into the needs and fixed purposes of the people, so that
they may do justice and work equity, so that they may protect all
persons in their rights, and yet break down the barriers of
privilege, which is the foe of right.

FORESTS.

If there is any one duty which more than another we owe it to our
children and our children's children to perform at once, it is to
save the forests of this country, for they constitute the first and
most important element in the conservation of the natural resources
of the country. There are of course two kinds of natural resources,
One is the kind which can only be used as part of a process of
exhaustion; this is true of mines, natural oil and gas wells, and the
like. The other, and of course ultimately by far the most important,
includes the resources which can be improved in the process of wise
use; the soil, the rivers, and the forests come under this head. Any
really civilized nation will so use all of these three great national
assets that the nation will have their benefit in the future. Just as
a farmer, after all his life making his living from his farm, will,
if he is an expert farmer, leave it as an asset of increased value to
his son, so we should leave our national domain to our children,
increased in value and not worn out. There are small sections of our
own country, in the East and the West, in the Adriondacks, the White
Mountains, and the Appalachians, and in the Rocky Mountains, where we
can already see for ourselves the damage in the shape of permanent
injury to the soil and the river systems which comes from reckless
deforestation. It matters not whether this deforestation is due to
the actual reckless cutting of timber, to the fires that inevitably
follow such reckless cutting of timber, or to reckless and
uncontrolled grazing, especially by the great migratory bands of
sheep, the unchecked wandering of which over the country means
destruction to forests and disaster to the small home makers, the
settlers of limited means.

Shortsighted persons, or persons blinded to the future by desire to
make money in every way out of the present, sometimes speak as if no
great damage would be done by the reckless destruction of our
forests. It is difficult to have patience with the arguments of these
persons. Thanks to our own recklessness in the use of our splendid
forests, we have already crossed the verge of a timber famine in this
country, and no measures that we now take can, at least for many
years, undo the mischief that has already been done. But we can
prevent further mischief being done; and it would be in the highest
degree reprehensible to let any consideration of temporary
convenience or temporary cost interfere with such action, especially
as regards the National Forests which the nation can now, at this
very moment, control.

All serious students of the question are aware of the great damage
that has been done in the Mediterranean countries of Europe, Asia,
and Africa by deforestation. The similar damage that has been done in
Eastern Asia is less well known. A recent investigation into
conditions in North China by Mr. Frank N. Meyer, of the Bureau of
Plant Industry of the United States Department of Agriculture, has
incidentally furnished in very striking fashion proof of the ruin
that comes from reckless deforestation of mountains, and of the
further fact that the damage once done may prove practically
irreparable. So important are these investigations that I herewith
attach as an appendix to my message certain photographs showing
present conditions in China. They show in vivid fashion the appalling
desolation, taking the shape of barren mountains and gravel and
sand-covered plains, which immediately follows and depends upon the
deforestation of the mountains. Not many centuries ago the country of
northern China was one of the most fertile and beautiful spots in the
entire world, and was heavily forested. We know this not only from
the old Chinese records, but from the accounts given by the traveler,
Marco Polo. He, for instance, mentions that in visiting the provinces
of Shansi and Shensi he observed many plantations of mulberry trees.
Now there is hardly a single mulberry tree in either of these
provinces, and the culture of the silkworm has moved farther south,
to regions of atmospheric moisture. As an illustration of the
complete change in the rivers, we may take Polo's statement that a
certain river, the Hun Ho, was so large and deep that merchants
ascended it from the sea with heavily laden boats; today this river
is simply a broad sandy bed, with shallow, rapid currents wandering
hither and thither across it, absolutely unnavigable. But we do not
have to depend upon written records. The dry wells, and the wells
with water far below the former watermark, bear testimony to the good
days of the past and the evil days of the present. Wherever the native
vegetation has been allowed to remain, as, for instance, here and
there around a sacred temple or imperial burying ground, there are
still huge trees and tangled jungle, fragments of the glorious
ancient forests. The thick, matted forest growth formerly covered the
mountains to their summits. All natural factors favored this dense
forest growth, and as long as it was permitted to exist the plains at
the foot of the mountains were among the most fertile on the globe,
and the whole country was a garden. Not the slightest effort was
made, however, to prevent the unchecked cutting of the trees, or to
secure reforestation. Doubtless for many centuries the tree-cutting
by the inhabitants of the mountains worked but slowly in bringing
about the changes that have now come to pass; doubtless for
generations the inroads were scarcely noticeable. But there came a
time when the forest had shrunk sufficiently to make each year's
cutting a serious matter, and from that time on the destruction
proceeded with appalling rapidity; for of course each year of
destruction rendered the forest less able to recuperate, less able to
resist next year's inroad. Mr. Meyer describes the ceaseless progress
of the destruction even now, when there is so little left to destroy.
Every morning men and boys go out armed with mattox or axe, scale the
steepest mountain sides, and cut down and grub out, root and branch,
the small trees and shrubs still to be found. The big trees
disappeared centuries ago, so that now one of these is never seen
save in the neighborhood of temples, where they are artificially
protected; and even here it takes all the watch and care of the
tree-loving priests to prevent their destruction. Each family, each
community, where there is no common care exercised in the interest of
all of them to prevent deforestation, finds its profit in the
immediate use of the fuel which would otherwise be used by some other
family or some other community. In the total absence of regulation of
the matter in the interest of the whole people, each small group is
inevitably pushed into a policy of destruction which can not afford
to take thought for the morrow. This is just one of those matters
which it is fatal to leave to unsupervised individual control. The
forest can only be protected by the State, by the Nat