Speech Transcript:

 To the Congress of the United States:

The present state of the Union, upon which it is customary for the
President to report to the Congress under the provisions of the
Constitution, is such that it may be regarded with encouragement and
satisfaction by every American. Our country is almost unique in its
ability to discharge fully and promptly all its obligations at home
and abroad, and provide for all its inhabitants an increase in
material resources, in intellectual vigor and in moral power. The
Nation holds a position unsurpassed in all former human experience.
This does not mean that we do not have any problems. It is elementary
that the increasing breadth of our experience necessarily increases
the problems of our national life. But it does mean that if all will
but apply ourselves industriously and honestly, we have ample powers
with which to meet our problems and provide for I heir speedy
solution. I do not profess that we can secure an era of perfection in
human existence, but we can provide an era of peace and prosperity,
attended with freedom and justice and made more and more satisfying
by the ministrations of the charities and humanities of life.

Our domestic problems are for the most part economic. We have our
enormous debt to pay, and we are paying it. We have the high cost of
government to diminish, and we are diminishing it. We have a heavy
burden of taxation to reduce, and we are reducing it. But while
remarkable progress has been made in these directions, the work is
yet far from accomplished. We still owe over $21,000,000,000, the
cost of the National Government is still about $3,500,000,000, and
the national taxes still amount to about $27 for each one of our
inhabitants. There yet exists this enormous field for the application
of economy.

In my opinion the Government can do more to remedy the economic ills
of the people by a system of rigid economy in public expenditure than
can be accomplished through any other action. The costs of our
national and local governments combined now stand at a sum close to
$100 for each inhabitant of the land. A little less than one-third of
this is represented by national expenditure, and a little more than
two-thirds by local expenditure. It is an ominous fact that only the
National Government is reducing its debt. Others are increasing
theirs at about $1,000,000,000 each year. The depression that
overtook business, the disaster experienced in agriculture, the lack
of employment and the terrific shrinkage in all values which our
country experienced in a most acute form in 1920, resulted in no
small measure from the prohibitive taxes which were then levied on
all productive effort. The establishment of a system of drastic
economy in public expenditure, which has enabled us to pay off about
one-fifth of the national debt since 1919, and almost cut in two the
national tax burden since 1921, has been one of the main causes in
reestablishing a prosperity which has come to include within its
benefits almost every one of our inhabitants. Economy reaches
everywhere. It carries a blessing to everybody.

The fallacy of the claim that the costs of government are borne by
the rich and those who make a direct contribution to the National
Treasury can not be too often exposed. No system has been devised, I
do not think any system could be devised, under which any person
living in this country could escape being affected by the cost of our
government. It has a direct effect both upon the rate and the
purchasing power of wages. It is felt in the price of those prime
necessities of existence, food, clothing, fuel and shelter. It would
appear to be elementary that the more the Government expends the more
it must require every producer to contribute out of his production to
the Public Treasury, and the less he will have for his own benefit.
The continuing costs of public administration can be met in only one
way--by the work of the people. The higher they become, the more the
people must work for the Government. The less they are, the more the
people can work for themselves.

The present estimated margin between public receipts and expenditures
for this fiscal year is very small. Perhaps the most important work
that this session of the Congress can do is to continue a policy of
economy and further reduce the cost of government, in order that we
may have a reduction of taxes for the next fiscal year. Nothing is
more likely to produce that public confidence which is the forerunner
and the mainstay of prosperity, encourage and enlarge business
opportunity with ample opportunity for employment at good wages,
provide a larger market for agricultural products, and put our
country in a stronger position to be able to meet the world
competition in trade, than a continuing policy of economy. Of course
necessary costs must be met, proper functions of the Government
performed, and constant investments for capital account and
reproductive effort must be carried on by our various departments.
But the people must know that their Government is placing upon them
no unnecessary burden.
Taxes

Everyone desires a reduction of taxes, and there is a great
preponderance of sentiment in favor of taxation reform. When I
approved the present tax law, I stated publicly that I did so in
spite of certain provisions which I believed unwise and harmful. One
of the most glaring of these was the making public of the amounts
assessed against different income-tax payers. Although that damage
has now been done, I believe its continuation to be detrimental To
the public welfare and bound to decrease public revenues, so that it
ought to be repealed.

Anybody can reduce taxes, but it is not so easy to stand in the gap
and resist the passage of increasing appropriation bills which would
make tax reduction impossible. It will be very easy to measure the
strength of the attachment to reduced taxation by the power with
which increased appropriations are resisted. If at the close of the
present session the Congress has kept within the budget which I
propose to present, it will then be possible to have a moderate
amount of tax reduction and all the tax reform that the Congress may
wish for during the next fiscal year. The country is now feeling the
direct stimulus which came from the passage of the last revenue bill,
and under the assurance of a reasonable system of taxation there is
every prospect of an era of prosperity of unprecedented proportions.
But it would be idle to expect any such results unless business can
continue free from excess profits taxation and be accorded a system
of surtaxes at rates which have for their object not the punishment
of success or the discouragement of business, but the production of
the greatest amount of revenue from large incomes. I am convinced
that the larger incomes of the country would actually yield more
revenue to the Government if the basis of taxation were
scientifically revised downward. Moreover the effect of the present
method of this taxation is to increase the cost of interest on
productive enterprise and to increase the burden of rent. It is
altogether likely that such reduction would so encourage and
stimulate investment that it would firmly establish our country in
the economic leadership of the world.
Waterways

Meantime our internal development should go on. Provision should be
made for flood control of such rivers as the Mississippi and the
Colorado, and for the opening up of our inland waterways to commerce.
Consideration is due to the project of better navigation from the
Great Lakes to the Gulf. Every effort is being made to promote an
agreement with Canada to build the, St. Lawrence waterway. There are
pending before the Congress bills for further development of the
Mississippi Basin, for the taking over of the Cape Cod Canal in
accordance with a moral obligation which seems to have been incurred
during the war, and for the improvement of harbors on both the
Pacific and the Atlantic coasts. While this last should be divested
of some of its projects and we must proceed slowly, these bills in
general have my approval. Such works are productive of wealth and in
the long run tend to a reduction of the tax burden.
Reclamation

Our country has a well defined policy of reclamation established
under statutory authority. This policy should be continued and made a
self-sustaining activity administered in a manner that will meet local
requirements and bring our and lands into a profitable state of
cultivation as fast as there is a market for their products.
Legislation is pending based on the report of the Fact Finding
Commission for the proper relief of those needing extension of time
in which to meet their payments on irrigated land, and for additional
amendments and reforms of our reclamation laws, which are all
exceedingly important and should be enacted at once.

No more important development has taken place in the last year than
the beginning of a restoration of agriculture to a prosperous
condition. We must permit no division of classes in this country,
with one occupation striving to secure advantage over another. Each
must proceed under open opportunities and with a fair prospect of
economic equality. The Government can not successfully insure
prosperity or fix prices by legislative fiat. Every business has its
risk and its times of depression. It is well known that in the long
run there will be a more even prosperity and a more satisfactory
range of prices under the natural working out of economic laws than
when the Government undertakes the artificial support of markets and
industries. Still we can so order our affairs, so protect our own
people from foreign competition, so arrange our national finances, so
administer our monetary system, so provide for the extension of
credits, so improve methods of distribution, as to provide a better
working machinery for the transaction of the business of the Nation
with the least possible friction and loss. The Government has been
constantly increasing its efforts in these directions for the relief
and permanent establishment of agriculture on a sound and equal basis
with other business.

It is estimated that the value of the crops for this harvest year may
reach $13,000,000,000, which is an increase of over $3,000,000,000 in
three years. It compares with $7,100,000,000 in 1913, and if we make
deduction from the figures of 1924 for the comparatively decreased
value of the dollar, the yield this year still exceeds 1913 in
purchasing power by over $1,000,000,000, and in this interval there
has been no increase in the number of farmers. Mostly by his own
effort the farmer has decreased the cost of production. A marked
increase in the price of his products and some decrease in the price
of his supplies has brought him about to a parity with the rest of
the Nation. The crop area of this season is estimated at 370,000,000
acres, which is a decline of 3,000,000 acres from last year, and
6,000,000 acres from 1919. This has been a normal and natural
application of economic laws, which has placed agriculture on a
foundation which is undeniably sound and beginning to be
satisfactory.

A decrease in the world supply of wheat has resulted in a very large
increase in the price of that commodity. The position of all
agricultural products indicates a better balanced supply, but we can
not yet conclude that agriculture is recovered from the effects of
the war period or that it is permanently on a prosperous basis. The
cattle industry has not yet recovered and in some sections has been
suffering from dry weather. Every effort must be made both by
Government activity and by private agencies to restore and maintain
agriculture to a complete normal relationship with other industries.

It was on account of past depression, and in spite of present more
encouraging conditions, that I have assembled an Agricultural
Conference made up of those who are representative of this great
industry in both its operating and economic sides. Everyone knows
that the great need of the farmers is markets. The country is not
suffering on the side of production. Almost the entire difficulty is
on the side of distribution. This reaches back, of course, to unit
costs and diversification, and many allied subjects. It is
exceedingly intricate, for our domestic and foreign trade,
transportation and banking, and in fact our entire economic system,
are closely related to it. In time for action at this session, I hope
to report to the Congress such legislative remedies as the conference
may recommend. An appropriation should be made to defray their
necessary expenses.
Muscle Shoals

The production of nitrogen for plant food in peace and explosives in
war is more and more important. It is one of the chief sustaining
elements of life. It is estimated that soil exhaustion each year is
represented by about 9,000,000 tons and replenishment by 5,450,000
tons. The deficit of 3,550,000 tons is reported to represent the
impairment of 118,000,000 acres of farm lands each year.

To meet these necessities the Government has been developing a water
power project at Muscle Shoals to be equipped to produce nitrogen for
explosives and fertilizer. It is my opinion that the support of
agriculture is the chief problem to consider in connection with this
property. It could by no means supply the present needs for nitrogen,
but it would help and its development would encourage bringing other
water powers into like use.

Several offers have been made for the purchase of this property.
Probably none of them represent final terms. Much costly
experimentation is necessary to produce commercial nitrogen. For that
reason it is a field better suited to private enterprise than to
Government operation. I should favor a sale of this property, or
long-time lease, tinder rigid guaranties of commercial nitrogen
production at reasonable prices for agricultural use. There would be
a surplus of power for many years over any possibility of its
application to a developing manufacture of nitrogen. It may be found
advantageous to dispose of the right to surplus power separately with
such reservations as will allow its gradual withdrawal and application
to nitrogen manufacture. A subcommittee of the Committees on
Agriculture should investigate this field and negotiate with
prospective purchasers. If no advantageous offer be made, the
development should continue and the plant should be dedicated
primarily to the production of materials for the fertilization of the
soil.
Railways

The railways during the past year have made still further progress in
recuperation from the war, with large rains in efficiency and ability
expeditiously to handle the traffic of the country. We have now
passed through several periods of peak traffic without the car
shortages which so frequently in the past have brought havoc to our
agriculture and industries. The condition of many of our great
freight terminals is still one of difficulty and results in imposing,
large costs on the public for inward-bound freight, and on the
railways for outward-bound freight. Owing to the growth of our large
cities and the great increase in the volume of traffic, particularly
in perishables, the problem is not only difficult of solution, but in
some cases not wholly solvable by railway action alone.

In my message last year I emphasized the necessity for further
legislation with a view to expediting the consolidation of our rail
ways into larger systems. The principle of Government control of
rates and profits, now thoroughly imbedded in our governmental
attitude toward natural monopolies such as the railways, at once
eliminates the need of competition by small units as a method of rate
adjustment. Competition must be preserved as a stimulus to service,
but this will exist and can be increased tinder enlarged systems.
Consequently the consolidation of the railways into larger units for
the purpose of securing the substantial values to the public which
will come from larger operation has been the logical conclusion of
Congress in its previous enactments, and is also supported by the
best opinion in the country. Such consolidation will assure not only
a greater element of competition as to service, but it will afford
economy in operation, greater stability in railway earnings, and more
economical financing. It opens large possibilities of better
equalization of rates between different classes of traffic so as to
relieve undue burdens upon agricultural products and raw materials
generally, which are now not possible without ruin to small units
owing to the lack of diversity of traffic. It would also tend to
equalize earnings in such fashion as to reduce the importance of
section 15A, at which criticism, often misapplied, has been directed.
A smaller number of units would offer less difficulties in labor
adjustments and would contribute much to the, solution of terminal
difficulties.

The consolidations need to be carried out with due regard to public
interest and to the rights and established life of various
communities in our country. It does not seem to me necessary that we
endeavor to anticipate any final plan or adhere to an artificial and
unchangeable project which shall stipulate a fixed number of systems,
but rather we ought to approach the problem with such a latitude of
action that it can be worked out step by step in accordance with a
comprehensive consideration of public interest. Whether the number of
ultimate systems shall be more or less seems to me can only be
determined by time and actual experience in the development of such
consolidations.

Those portions of the present law contemplating consolidations ore
not, sufficiently effective in producing expeditious action and need
amplification of the authority of the Interstate Commerce Commission,
particularly in affording a period for voluntary proposals to the
commission and in supplying Government pressure to secure action
after the expiration of such a period.

There are other proposals before Congress for amending the
transportation acts. One of these contemplates a revision of the
method of valuation for rate-making purposes to be followed by a
renewed valuation of the railways. The valuations instituted by the
Interstate Commerce Commission 10 years ago have not yet been
completed. They have cost the Government an enormous sum, and they
have imposed great expenditure upon the railways, most of which has
in effect come out of the public in increased rates. This work should
not be abandoned or supplanted until its results are known and can be
considered.

Another matter before the Congress is legislation affecting the labor
sections of the transportation act. Much criticism has been directed
at the workings of this section and experience has shown that some
useful amendment could be made to these provisions.

It would be helpful if a plan could be adopted which, while retaining
the practice of systematic collective bargaining with conciliation
voluntary arbitration of labor differences, could also provide
simplicity in relations and more direct local responsibility of
employees and managers. But such legislation will not meet the
requirements of the situation unless it recognizes the principle that
t e public has a right to the uninterrupted service of transportation,
and therefore a right to be heard when there is danger that the Nation
may suffer great injury through the interruption of operations because
of labor disputes. If these elements are not comprehended in proposed
legislation, it would be better to gain further experience with the
present organization for dealing with these questions before
undertaking a change.
Shipping Board

The form of the organization of the Shipping Board was based
originally on its functions as a semi judicial body in regulation of
rates. During the war it was loaded with enormous administrative
duties. It has been demonstrated time and again that this form of
organization results in indecision, division of opinion and
administrative functions, which make a wholly inadequate foundation
for the conduct of a great business enterprise. The first principle
in securing the objective set out by Congress in building up the
American merchant marine upon the great trade routes and subsequently
disposing of it into private operation can not proceed with
effectiveness until the entire functions of the board are
reorganized. The immediate requirement is to transfer into the
Emergency Fleet, Corporation the whole responsibility of operation of
the fleet and other property, leaving to the Shipping Board solely the
duty of determining certain major policies which require deliberative
action.

The procedure under section 28 of the merchant marine act has created
great difficulty and threatened friction during the past 12 months.
Its attempted application developed not only great opposition from
exporters, particularly as to burdens that may be imposed upon
agricultural products, but also great anxiety in the different
seaports as to the effect upon their relative rate structures. This
trouble will certainly recur if action is attempted under this
section. It is uncertain in some of its terms and of great difficulty
in interpretation.

It is my belief that action under this section should be suspended
until the Congress can reconsider the entire question in the light of
the experience that has been developed since its enactment.
National Elections

Nothing is so fundamental to the integrity of a republican form of
government as honesty in all that relates to the conduct of
elections. I am of the opinion that the national laws governing the
choice of members of the Congress should be extended to include
appropriate representation of the respective parties at the ballot
box ant equality of representation on the various registration
boards, wherever they exist.
The Judiciary

The docket of the Supreme Court is becoming congested. At the opening
term last year it had 592 cases, while this year it had 687 cases.
Justice long delayed is justice refused. Unless the court be given
power by preliminary and summary consideration to determine the
importance of cases, and by disposing of those which are not of
public moment reserve its time for the more extended consideration of
the remainder, the congestion of the docket is likely to increase. It
is also desirable that Supreme Court should have power to improve and
reform procedure in suits at law in the Federal courts through the
adoption of appropriate rules. The Judiciary Committee of the Senate
has reported favorably upon two bills providing for these reforms
which should have the immediate favorable consideration of the
Congress.

I further recommend that provision be made for the appointment of a
commission, to consist of two or three members of the Federal
judiciary and as many members of the bar, to examine the present
criminal code of procedure and recommend to the Congress measures
which may reform and expedite court procedure in the administration
and enforcement of our criminal laws.
Prison Reform

Pending before the Congress is a bill which has already passed one
House providing for a reformatory to which could be committed first
offenders and young men for the purpose of segregating them from
contact with banned criminals and providing them with special
training in order to reestablish in them the power to pursue a
law-abiding existence in the social and economic life of the Nation.
This is a matter of so much importance as to warrant the early
attention of the present session. Further provision should also be
made, for a like reason, for a separate reformatory for women.
National Police Bureau

Representatives of the International Police Conference will bring to
the attention of the Congress a proposal for the establishment of a
national police bureau. Such action would provide a central point for
gathering, compiling, and later distributing to local police
authorities much information which would be helpful in the prevention
and detection of crime. I believe this bureau is needed, and I
recommend favorable consideration of this proposal.
District of Columbia Welfare

The welfare work of the District of Columbia is administered by
several different boards dealing with charities and various
correctional efforts. It would be an improvement if this work were
consolidated and placed under the direction of a single commission.
French Spoliation Claims

During the last session of the Congress legislation was introduced
looking to the payment of the remaining claims generally referred to
as the French spoliation claims. The Congress has provided for the
payment of many similar claims. Those that remain unpaid have been
long pending. The beneficiaries thereunder have every reason to
expect payment. These claims have been examined by the Court of
Claims and their validity and amount determined. The United States
ought to pay its debts. I recommend action by the Congress which will
permit of the payment of these remaining claims.
The Wage Earner

Two very important policies have been adopted by this country which,
while extending their benefits also in other directions, have been of
the utmost importance to the wage earners. One of these is the
protective tariff, which enables our people to live according to a
better standard and receive a better rate of compensation than any
people, any time, anywhere on earth, ever enjoyed. This saves the
American market for the products of the American workmen. The other
is a policy of more recent origin and seeks to shield our wage
earners from the disastrous competition of a great influx of foreign
peoples. This has been done by the restrictive immigration law. This
saves the American job for the American workmen. I should like to see
the administrative features of this law rendered a little more humane
for the purpose of permitting those already here a greater latitude
in securing admission of members of their own families. But I believe
this law in principle is necessary and sound, and destined to increase
greatly the public welfare. We must maintain our own economic
position, we must defend our own national integrity.

It is gratifying to report that the progress of industry, the
enormous increase in individual productivity through labor-saving
devices, and the high rate of wages have all combined to furnish our
people in general with such an abundance not only of the necessaries
but of the conveniences of life that we are by a natural evolution
solving our problems of economic and social justice.
The negro

These developments have brought about a very remarkable improvement
in the condition of the negro race. Gradually, but surely, with the
almost universal sympathy of those among whom they live, the colored
people are working out their own destiny. I firmly believe that it is
better for all concerned that they should be cheerfully accorded their
full constitutional rights, that they should be protected from all of
those impositions to which, from their position, they naturally fall
a prey, especially from the crime of lynching and that they should
receive every encouragement to become full partakers in all the
blessings of our common American citizenship.
Civil service

The merit system has long been recognized as the correct basis for
employment in our, civil service. I believe that first second, and
third class postmasters, and without covering in the present
membership the field force of prohibition enforcement, should be
brought within the classified service by statute law. Otherwise the
Executive order of one administration is changed by the Executive
order of another administration, and little real progress is made.
Whatever its defects, the merit system is certainly to be preferred
to the spoils system.
Departmental reorganization

One way to save public money would be to pass the pending bill for
the reorganization of the various departments. This project has been
pending for some time, and has had the most careful consideration of
experts and the thorough study of a special congressional committee.
This legislation is vital as a companion piece to the Budget law.
Legal authority for a thorough reorganization of the Federal
structure with some latitude of action to the Executive in the
rearrangement of secondary functions would make for continuing
economy in the shift of government activities which must follow every
change in a developing country. Beyond this many of the independent
agencies of the Government must be placed under responsible Cabinet
officials, if we are to have safeguards of efficiency, economy, and
probity.
Army and navy

Little has developed in relation to our national defense which needs
special attention. Progress is constantly being made in air
navigation and requires encouragement and development. Army aviators
have made a successful trip around the world, for which I recommend
suitable recognition through provisions for promotion, compensation,
and retirement. Under the direction of the Navy a new Zeppelin has
been successfully brought from Europe across the Atlantic to our own
country.

Due to the efficient supervision of the Secretary of War the Army of
the United States has been organized with a small body of Regulars
and a moderate National Guard and Reserve. The defense test of
September 12 demonstrated the efficiency of the operating plans.
These methods and operations are well worthy of congressional
support.

Under the limitation of armaments treaty a large saving in outlay and
a considerable decrease in maintenance of the Navy has been
accomplished. We should maintain the policy of constantly working
toward the full treaty strength of the Navy. Careful investigation is
being made in this department of the relative importance of aircraft,
surface and submarine vessels, in order that we may not fail to take
advantage of all modern improvements for our national defense. A
special commission also is investigating the problem of petroleum oil
for the Navy, considering the best policy to insure the future supply
of fuel oil and prevent the threatened drainage of naval oil
reserves. Legislative action is required to carry on experiments in
oil shale reduction, as large deposits of this type have been set
aside for the use of the Navy.

We have been constantly besought to engage in competitive armaments.
Frequent reports will reach us of the magnitude of the military
equipment of other, nations. We shall do well to be little impressed
by such reports or such actions. Any nation undertaking to maintain a
military establishment with aggressive and imperialistic designs will
find itself severely handicapped in the economic development of the
world. I believe thoroughly in the Army and Navy, in adequate defense
and preparation. But I am opposed to any policy of competition in
building and maintaining land or sea armaments.

Our country has definitely relinquished the old standard of dealing
with other countries by terror and force, and is definitely committed
to the new standard of dealing with them through friendship and
understanding. This new policy should be constantly kept in mind by
the guiding forces of the Army and Navy, by the. Congress and by the
country at large. I believe it holds a promise of great benefit to
humanity. I shall resist any attempt to resort to the old methods and
the old standards. I am especially solicitous that foreign nations
should comprehend the candor and sincerity with which we have adopted
this position. While we propose to maintain defensive and
supplementary police forces by land and sea, and to train them
through inspections and maneuvers upon appropriate occasions in order
to maintain their efficiency, I wish every other nation to understand
that this does not express any unfriendliness or convey any hostile
intent. I want the armed forces of America to be considered by all
peoples not as enemies but as friends as the contribution which is
made by this country for the maintenance of the peace and security of
the world.
Veterans

With the authorization for general hospitalization of the veterans of
all wars provided during the present year, the care and treatment of
those who have served their country in time of peril and the attitude
of the Government toward them is not now so much one of needed
legislation as one of careful, generous and humane administration. It
will ever be recognized that their welfare is of the first concern and
always entitled to the most solicitous consideration oil the part of
their fellow citizens. They are organized in various associations, of
which the chief and most representative is the American Legion.
Through its officers the Legion will present to the Congress numerous
suggestions for legislation. They cover such a wide variety of
subjects that it is impossible to discuss them within the scope of
this message. With many of the proposals I join in hearty approval
and commend them all to the sympathetic investigation and
consideration of the Congress.
Foreign relations

At no period in the past 12 years have our foreign relations been in
such a satisfactory condition as they are at the present time. Our
actions in the recent months have greatly strengthened the American
policy of permanent peace with independence. The attitude which our
Government took and maintained toward an adjustment of European
reparations, by pointing out that it wits not a political but a
business problem, has demonstrated its wisdom by its actual results.
We desire to see Europe restored that it may resume its productivity
in the increase of industry and its support in the advance of
civilization. We look with great gratification at the hopeful
prospect of recuperation in Europe through the Dawes plan. Such
assistance as can be given through the action of the public
authorities and of our private citizens, through friendly counsel and
cooperation, and through economic and financial support, not for any
warlike effort but for reproductive enterprise, not to provide means
for unsound government financing but to establish sound business
administration should be unhesitatingly provided.

Ultimately nations, like individuals, can not depend upon each other
but must depend upon themselves. Each one must work out its own
salvation. We have every desire to help. But with all our resources
we are powerless to save unless our efforts meet with a constructive
response. The situation in our own country and all over the world is
one Chat can be improved only by bard work and self-denial. It is
necessary to reduce expenditures, increase savings and liquidate
debts. It is in this direction that there lies the greatest hope of
domestic tranquility and international peace. Our own country ought
to finish the leading example in this effort. Our past adherence to
this policy, our constant refusal to maintain a military
establishment that could be thought to menace the security of others,
our honorable dealings with other nations whether great or small, has
left us in the almost constant enjoyment of peace.

It is not necessary to stress the general desire of all the people of
this country for the promotion of peace. It is the leading principle
of all our foreign relations. We have on every occasion tried to
cooperate to this end in all ways that were consistent with our
proper independence and our traditional policies. It will be my
constant effort to maintain these principles, and to reinforce them
by all appropriate agreements and treaties. While we desire always to
cooperate and to help, we are equally determined to be independent and
free. Right and truth and justice and humanitarian efforts will have
the moral support of this country all over the world. But we do not
wish to become involved in the political controversies of others. Nor
is the country disposed to become a member of the League of Nations or
to assume the obligations imposed by its covenant.
International court

America has been one of the foremost nations in advocating tribunals
for the settlement of international disputes of a justiciable
character. Our representatives took a leading in those conferences
which resulted in the establishment of e ague Tribunal, and later in
providing for a Permanent Court of International Justice. I believe
it would be for the advantage of this country and helpful to the
stability of other nations for us to adhere to the protocol
establishing, that court upon the conditions stated in the
recommendation which is now before the Senate, and further that our
country shall not be bound by advisory opinions which may be,
rendered by the court upon questions which we have not voluntarily
submitted for its judgment. This court would provide a practical and
convenient tribunal before which we could go voluntarily, but to
which we could not be summoned, for a determination of justiciable
questions when they fail to be resolved by diplomatic negotiations.
Disarmament conference

Many times I have expressed my desire to see the work of the
Washington Conference on Limitation of Armaments appropriately
supplemented by further agreements for a further reduction M for the
purpose of diminishing the menace and waste of the competition in
preparing instruments of international war. It has been and is my
expectation that we might hopefully approach other great powers for
further conference on this subject as soon as the carrying out of the
present reparation plan as the established and settled policy of
Europe has created a favorable opportunity. But on account of
proposals which have already been made by other governments for a
European conference, it will be necessary to wait to see what the
outcome of their actions may be. I should not wish to propose or have
representatives attend a conference which would contemplate
commitments opposed to the freedom of action we desire to maintain
unimpaired with respect to our purely domestic policies.
International law

Our country should also support efforts which are being made toward
the codification of international law. We can look more hopefully, in
the first instance, for research and studies that are likely to be
productive of results, to a cooperation among representatives of the
bar and members of international law institutes and societies, than
to a conference of those who are technically representative of their
respective governments, although, when projects have been developed,
they must go to the governments for their approval. These expert
professional studies are going on in certain quarters and should have
our constant encouragement and approval.
Outlaw of war

Much interest has of late been manifested in this country in the
discussion of various proposals to outlaw aggressive war. I look with
great sympathy upon the examination of this subject. It is in harmony
with the traditional policy of our country, which is against
aggressive war and for the maintenance of permanent and honorable
peace. While, as I have said, we must safeguard our liberty to deal
according to our own judgment with our domestic policies, we can not
fail to view with sympathetic interest all progress to this desired
end or carefully to study the measures that may be proposed to attain
it.
Latin america

While we are desirous of promoting peace in every quarter of the
globe, we have a special interest in the peace of this hemisphere. It
is our constant desire that all causes of dispute in this area may be
tranquilly and satisfactorily adjusted. Along with our desire for
peace is the earnest hope for the increased prosperity of our sister
republics of Latin America, and our constant purpose to promote
cooperation with them which may be mutually beneficial and always
inspired by the most cordial friendships.
Foreign debts

About $12,000,000,000 is due to our Government from abroad, mostly
from European Governments. Great Britain, Finland, Hungary, Lithuania
and Poland have negotiated settlements amounting close to
$5,000,000,000. This represents the funding of over 42 per cent of
the debt since the creation of the special Foreign Debt Commission.
As the life of this commission is about to expire, its term should be
extended. I am opposed to the cancellation of these debts and believe
it for the best welfare of the world that they should be liquidated
and paid as fast as possible. I do not favor oppressive measures, but
unless money that is borrowed is repaid credit can not be secured in
time of necessity, and there exists besides a moral obligation which
our country can not ignore and no other country can evade. Terms and
conditions may have to conform to differences in the financial
abilities of the countries concerned, but the principle that each
country should meet its obligation admits of no differences and is of
universal application.

It is axiomatic that our country can not stand still. It would seem
to be perfectly plain from recent events that it is determined to go
forward. But it wants no pretenses, it wants no vagaries. It is
determined to advance in an orderly, sound and common-sense way. It
does not propose to abandon the theory of the Declaration that the
people have inalienable rights which no majority and no power of
government can destroy. It does not propose to abandon the practice
of the Constitution that provides for the protection of these rights.
It believes that within these limitations, which are imposed not by
the fiat of man but by the law of the Creator, self-government is
just and wise. It is convinced that it will be impossible for the
people to provide their own government unless they continue to own
their own property.

These are the very foundations of America. On them has been erected a
Government of freedom and equality, of justice and mercy, of education
and charity. Living under it and supporting it the people have come
into great possessions on the material and spiritual sides of life. I
want to continue in this direction. I know that the Congress shares
with me that desire. I want our institutions to be more and more
expressive of these principles. I want the people of all the earth to
see in the American flag the symbol of a Government which intends no
oppression at home and no aggression abroad, which in the spirit of a
common brotherhood provides assistance in time of distress.