PRESIDENT’S MESSAGE.
Review of Business Conditions—Financial Situation—Ener
gency Currency—Asks Amendment to Anti-Trust Law
Tariff Revision after Election—Income and Inheritance
taxes—Impartial Law Enforcement—Inland Waterways
—Postal Savings Bank and Parcels Post
Campaign Expenses—Better Treatment for Army and
Navy
In hli annual message to Congress
President Hoosavelt begins with a re-
view of Business Conditions. In no
nation are the fundamental business
conditions sounder than in ours at this
vary moment; and it is fool sh, when
such is the case, for people to board
instead of keeping it in sound banks;
for it is such boarding that is tba im-
mediate occasion of money stringency.
Moreover, as a rule, tbe .business of
our people is conducted with honesty
and probity, and this applies alike to
farms and factories, to railroads and
banks, to all our legitimate commer-
cial enterprises.
In any large body of men, howerer,
there are certain to be some who are
dishonest, and if tbe conditions are
such that these men prosper or com-
mit their misdeeds with Impunity,
their example Is a very evil thing for
the community. Where these men ars
business men of great sagacity and of
temperament both unscrupulous and
reckless, and where the conditions are
such that they act without supervis-
ion they delude many innocent people
Into making Investments or embark-
ing In kinds of business that are really
unsound. Of inter-state commerce he
says only the national government can
In thorough-going fashion exercise the
needed control. This does not mean
that there should be any extension of
federal authority for such authority
already exists under the Constitution
In amplest and most far-reaching
form; but It doea mean that there
should be an extension of federal ac-
tivity. This Is not advocating central-
ization It is merely looking facts In
the fine and realizing that centraliza-
tion in business has already come and
cannot be avo ded or undone, and that
the public at large cun only protect
Itself from certain evil effects of this
business centralization by providing
better methods for the exercise of con-
trol through the authority already
centralized in the national govern-
ment by the constitution itself.
There must lie no halt in the healthy
constructive course of action which
this nat'on hus elected to pursue, and
has steadily pursued, during the last
six years, as shown both in the legis-
lation of the Congress and the admin-
istration of tlie law by the Depart-
ment of Justice.    «
The most vital need is in connec-
tion with the railroads. As to these,
In my judgment there should now be
either a national incorporation act or
a law licensing railway companies to
engage in interstate commerce upon
certain conditions. The law should be
so framed as to give to the interstate
commerce commission power to pass
upon the future issue of securities,
while ample means should be provided
to enable the commission whenever
In its judgment It is necessary, to
make a physical valuation of any rail-
road.
As I stated in my message to the
Congress a year ago. railroads should
be given power to enter into agree-
ments. subject to these agreements
being made public In minute detail
and to the consent of the interstate
commission being first obtained.
Until the national government as-
sumes proper control of interstate
commerce, in the exercise' of the
authority it already possesses, it will
be impossible either to give to or to
get from the' railroads full justice
The railroads and all other great cor-
porations will do well to recognize
combinations. Modern Industrial con
ditioiis are smh that combination i»
not only necessary but mevliable. It is
so in the world of bus ness just as it
la so in the world of labor, and it is
as iJle to desire to put an end to all
lecrporat ons, to a 1 big com < ft on
of capital, as to desire to pul an end
to (ombiuations of lubor. Corporation
and labor union alike have come to
stay. Each If properly managed is a
source of good and not evil.
The anti-trust law should not be re-
pealed; but it should bo made both
more efficient and more In harmony
with actual conditions. It should he so
amended as to forbid only the k'nd of
combination which does harm to the
general public, such amendment to be
accompanied by, or to be an incident
of, a grant of supervisory power to tho
government over these big concerns
engaged in interstate business. This
should be accomplished by provision
for the compulsory publication of ac-
counts and the subjection of books
and papers to the Inspection of the
government officials. A beg lining has
already been made for such supervis-
ion by the establishment of the Bu-
reau of Corporations.
The anti-trust law should not pro-
hibit combinations that do no injus-
tice to the public, still less those the
existence of which Is on the whole a
benefit to the public. But even If this
feature of the law were abolished,
there would remain as an equally ob-
jectionable feature the difficulty and
delay now incident to its enforce-
ment. The government must now sub-
mit to Irksome and repeated delay be-
fore obtaining a final decision of the
courts upon proceedings instituted,
and even a favorable decree may mean
an empty victory
A combination should not be toler-
ated if it abuse the power acquired by
combination to the public detriment.
No corporation or association of any
kind should be permitted to engage in
foreign or interstate commerce that 19
formed for the purpose of, or whose
operations create, a monopoly or gen-
eral control of the production, sale, or
distribution of any one or more of the
prime necessities of life or articles of
general use and necessity. Such com-
b nations are against public policy;
they violate the common law; the
doors of the courts are closed to those
who are parties to them, and I believe
the CongVess can close the channels of
inter-state commerce against them
for its protection.
Those who fear, from any reason,
the extension of federal activity will
do well to study the history not only
of the national banking act but or
tho pure food law, and notably the
moat inspection law recently enacted.
Tbe pure food law was opposed so
violently that its passage was delayed
| an n# w he her oifi • ■ >r1 directors of
, national banks should evtr be allowed
i to loan to themselves Trust com pa
uies should be subject to the same
eupt-rvis t n as b.u.ks. legislation to
this effect should be enacted for the
District of CdlumbU and the territo
ties.
Yet we must also renumber that
The Farmer ‘‘vpn the wisest legislation i n tbe sub-
ject can only accomplish a certain
amount No liglslat on tan by any | os-
sibil tv g .arantce the busir.es commu-
nity against (he result* o( speculative
folly any more than it can guarantee
an individual ana list the result of hit
fxtcavaguiice. When an individu.il
mortgages his house to buy an auto-
mobile he invites d master, and when
wealthy men or men who pone as suth.
or are unscrupulously eager to
become such, indulge in reckless specu-
lation—especially If it Is accompanied
by dishonesty—they jeopardize not
only their own future but the future
of all their innocent fellow citizens,
for they expose the whole business
community to panic and distress.
Hut the laws ibiuialnt need strength-
ening in more than one 1m|ioriunt
pout, they should be made mine dtf
iuite, so that no honest uiau cun be
led unwitt ngly to bnak them, and
so that the teal w-iongdoes can be
readily punished.
Moreover, there must he the public
opinion bark of the laws or the taws
themselves w ill be of no avail. At pres-
ent. while the average jurynnn un-
doubtedly w stirs to sec trusts broken
up. and is quite ready to fine the cor-
poration itself, lie is wry reluctant to
find the facts proven beyond a reason
THE TARIFF
There Is an evident and constantly
growing feeling among our people
that the time Is rapidly approaching
when our system of revenue legisla-
tion must he revised.
This country is definitely committed
to the protective system and any ef-
fort to uproot it could not but causo
widespread Industrial disaster. In
other words, the principal of the tanff
law could not with wisdom be changed.
Hut’in a country of such phenomenal
growth as ours it is probajily well
that#every dozen years or so the tariff
laws should be carefully scrutinized so
as to see t^at no excessive or-Improp-
er benefits are conferred thereby, that
proper revenue is provided, and that
our foreign trade is encouraged There
must always be as a minimum a tariff
which will not only allow for the col-
lection of an ample revenue, but which
will at least make good the difference
in cost of production here and abroad;
that is the difference In the labor cost
here and abroad; for the well being
of the wage worker must ever be a
cardinal point of American policy.
The question should be Approached
purely from a business standpoint;
both the time and manner of the
change being such as to arouse the
minimnm of ugltatlon and disturbance
in the business world, and to give the
least play for selfish and factional mo-
tives. The sole consideration should
be to see that the sum total of changes
represents the public good. This
means that the subject cannot with
wisdom be dealt with in the year
preceding a Presidential election, be-
cause as a matter of fact experience
has conclusively shown that at such a
time is it impossible to get men to
treat it from the standpoint o* the,
public good. In my judgment the wise
time to deal with the matter is imme-
diately after such election.
When our tax laws are revised tho
question of an Income tax and an In-
heritance tux should receive the care-
ful attention of our legislators In my
judgment both of these taxes should
be part of our system of Federal tax-
ation. I speak differently about the
income tax because one scheme for an
Income tax was declared unconstitu-
tional by the Supreme court; while In
for a decade; yet It has worked unmix- addition It is a difficult tax to admlnis-
ed and immediate good. The meat in-
spection law was even more violently
assailed; and the same men who now
denounce the attitude of the national
government in seeking to control the
workings of interstate common carri-
ers and business concerns, then assert-
ed that we were “discrediting and
niinfing a great American industry.”
Two years have not elapsed, and
already it has become evident that the
great benef t the law confers upon
the public is accompanied by an equal
benefit to the reputable packing estab-
lishments. The latter are better off
tinder the law than they were without
it. The benefit to interstate common
concerns from
the legislation I advocate would be
equally marked.
CURRENCY
I again urge on the Congress the
need of immediate attention to this
matter. We need a greater elasticity in
our currency; provided, of course,
that we recognize the even greater
that this control must come; the onlyj
quest'on is as to what governmental carr ers an<^ has.ness
body can most wisely exercise it. The
courts will determine the limits within
which the federal authority can ever-
cise it, and there will still remain
ample work within each state for the
railway commission of that state; and
the national Interstate commerce com-
mission will work in harmony with
the several state commissions, each
within its own province, to achievetho
desired end.
Moreover, in my Judgment there
should be additional legislation look-
ing to the proper control of the great'
business concerns engaged in Inter-1
state business, this control to he exer-
cised for their own benefit and pros-
perity no less than for the protection
of Investors and of the general public.
As I have repeatedly said in messages
lo the Congress and elsewhere, exper-
ence has definitely shown not merely
the unwisdom but the futility of en-
deavor ng to put a stop to all business
ter in its practical working, and" great
care would have to be exercised to
see that It was not evaded by the very
men whom it was most desirable to
have taxed, for if so evaded it would
of course, be worse than no tax at all;
a3 the least desirable of all taxes is
the tax which bears heavily upon the
honest as compared with the dishon-
est man.
Our aim is to recognize what Lin-
coln pointed out; The fact that there
are some respects in which men are
obviously .not equal; but also to insist
that there should ho an equality of
self-respect and of mutual respect, an
equality of rights before the law, and
at least an approximate equality in tho
conditions under which each man ob-
tains the chance to show the stuff
that is !n him when compared to his
fellows.
LAW ENFORCEMENT
A fewycars ago there was loud com-
plaint that the law could not be in-
voked against wealthy offenders.
severe in condemnation of the vice
which hides itself behind class or pro-
fessional loyalty, or which denies that
It is vice if it can escope conviction In
the courts.
The public and the representatives
of the public, the high officials,
whether on the bench or in executive
or legislative positions, need to remem-
ber that often the most dangerous
criminals so far aa the life of the nat-
ional is concerned, are not those who
commit the crimes known to and con-
demned by the popular conscience for
centuries, but those who commit
able doubt when it comes to sending ) crhnts only rendered possible by the
need of a safe and secure currency. I There is no such complaint now. The
There must always be the most rigid ’ course of the Department of Justice
examination by the national author ! in the last few years has been such as
ities. Provision should be made for an| to make it evident that no man stands
emergency currency. The emergency j above the law, that no corporation 13
issue should of course, be made with an I so wealthy that it cannot be held to
effective guaranty, and upon condi-i account. The Department of Justice
lions, prescribed by the government, j has been as prompt to proceed against
Such emergency issue must be I the wealthiest malefactor whose crime
based on adequate securities approved " was one of greed and cunning as to
by the government and must be issued
ln-
proceed aga nst the agitator who
under a heavy tax. This would permit j cites to brutal violence
currency being issued when the de-! Everything that can be done under
mand for It was urgent, while seenr- the existing state of public opinion.
ing Its retirement as the demand fell
off. It Is worth Investigating to deter-
which so profoundly influences both
the courts and Juries, has been done.
to ja l a member of the huslne.-s com-
munity for indulging In practices
whisii are profoundly unlnulthy, hut
which, unfortunately, the business
community has grown to recogn ze as
wdl i igh normal.
Both the present condition of the
law and the present temper of Juries
render it a task of extreme difficulty
to get at the real wrongdoos in any
such case, espcc ally by imprisonment.
Yet It is from every standpoint far
preferable to punish the prims ollend-
er by imprisonment rather than to
fine the corporation, w th the attend-
ant damage to stockholders
The two great evils in tho execution
of our criminal laws to day are senti-
mentality and technicality.
LABOR
Tbe national government should bo
a model employer. It should demand
the highest quality of service from
each of its employees, ami it should
care for all of them properly tn return
Congress should adopt legislation pro
viding limited but definite conipensa
tion for accidents to all workmen with
in the scope of the federal power, in-
cluding employees of navy yards and
arsenals In other words, a model em-
ployers' liability act, far-reaching and
thoroughgoing, should be enacted
which should apply to all positions,
public and private, over which the
national government has jurisdiction
The number of accidents to wage-
workers, Including those that are pre-
ventable and those that are not.
has become appalling in the mechan-
ical, manufacturing and transporta-
tion operations of the day. It works
grim hardship to the ordinary wage-
worker and his family to have tha ef-
fect of such an accident fall solely
upon him; and, on the other hand,
there are whole classes of attorneys
who exist only by Inciting men who
may or may not have been wronged to
undertake suits for negligence.
As a matter of fact a suit for negli-
gence Is generally an inadequate rem-
edy for the person injured, while It
often causes altogether disproportion-
ate annoyance to the employer. Tba
law Bhould be made such that the pay-
ment for accident by the employer
would be automatic Instead of being
a matter for lawsuits. Workmen
should receive certain and definite
condensation for all accidents In in-
dustry Irrespective of negligence.
WOMEN AND CHILDREN
No Question* growing out of our
rapid and complex industrial develop-
ment is more important than that of
the employment of women and child-
ren. The presence of women in Indus-
ry reacts with extreme directness up-
on the character of the home and fam-
ily life, and the conditions surrounding
the employment of children bear a
vital relation to our future citizenship.
Our legislation In these areas under
the control of the Congress is very
much behnd the legislation of our
more progressive state. A thorough
and comprehensive measure should
be adopted at this session of the Cou-
gress ielating to the employment of
women and children in the District of
Columbia und the territories. The in-
vestigation into the condition of wom-
en and children wage earners recently
authorized and directed by the Con-
gress is now being carried on in the
various states, and I recommend that
the appropriation made last year for
beginning ibis work be renewed in or-
der that we may have the thorough
and comprehensive investigation wh:ch
the subject demands.
The national government has an
ultimate resort for control of child la-
bor the use of the interstate commerce
clause to prevent the products of child
labor from entering into Interstate
commerce. But before using this it
ought certainly to enact model laws
on the subject for the territories un-
der its own immediate control.
There is one fundamental proposi-
tion which can be laid clown n3 ie
gards all these matters. namely
While honesty by itself will not solve
the problem, yet the Insistence upon
honesty—not merely technical honesty,
but honesty in purpose and spiril-
la an essential element in arriving at a
right conclusion. Vice in its cruder
nnd more archaic forms shocks every-
body; but Jhere Is very urgent need
that public opinion should be Just a9
complex conditions of our uioderu In-
dustrial life.
It makes pot a particle of difference
whether these crimes are committed
by a capitalist or by a laborer, by a
hading banker or manufacturer or
ta Iroad man, or by a leading repre-
sentative of a labor union. Swindling
in stocks, coiniptmg legislatures, mak-
ing fortunes by the inflation of secur-
ities, by wrecking railroads, by destroy-
ing competitors through rebates—
these forms of wrongdo ng in the cap-
italist, are far more Infamous than
any ordinary form of embezzlement
or forgery; yet It Is a mutter of ex-
treme difficulty to secure the punish-
ment of the man most guilty of them,
mo9t responsible for them.
The business man who condone*
such conduct stands on a level with
the laboring man who deliberately
supports a corrupt demagogue nnd ag
Itator, whether head of u union or
head of some municipality, beoause he
is said to have “stood by the union.”
The members of the business commu-
nity. the c'ucators, or clergymen,
who condon and encourage the first
kind of wrongdoing, are no more dan
gerous to the community, but are mor-
ally even worse, than the labor men
who are guilty of the second type of
wrongdoing,because less Is to be par-
doned those who have no such excuse
as is furnished either by ignorance^lr
by dire need
THE FARMER
The national government through
the Department of Agriculture should
do all It can by Joining with farmers
to encourage the growth In the open
farming country of such Institutions)
and social movements as will meet the
demand of the best type of farmers,
both for the improvement of their
farms and for the betterment of tbe
life itself. The Department of Agricul-
ture has In many places, perhaps espec-
ially in certain districts of the South,
accomplished an extraordinary amount
by co-operating with and teaching the
farmers through their associations,
on their own soil, how to Increase
their inconi »>y managing their farms
better thau they were hitherto man-
aged.
The farmer must not lose bin Inde-
pendence, hla Initiative, hia rugged
self-reliance, yet he must learn to
work In the heartiest co-operation,
with his fellows, exactly as the busi-
ness man has learned to work; and
be must prepare to use to constantly
better advantage the knowledge that
can be obtained from agricultural col-
leges, while he must Insist upon a
practical curriculum In the schools In
which h;s children are taught The De-
partment of Agriculture and the De-
partment of Commerce and Labor deal
with the fundamental needs of our
l>eo|ile in the production of raw mate-
rial and its manufacture and dlstribu-
t on, and therefore, with the welfare
of those who produce it in the raw
state, and of those who manufacture
and distribute it.
THE WATERWAYS
Our great river systems should be
developed as national water highways;
the Miss:ssippi, with its tributaries,
standing first in Importance, and the
Columbia second, although there are
many others of importance on the
Pacific, the Atlantic and the Gulf
slopes The national government
should undertake this work, and I
hope a beginning will be made in the
present Congress; and the greatest of
all our rivers, the Mississippi, should
receive especial attention. From the
Great Lake lo Die mouth of the Miss-
issippi there should be a deep water-
way. with deep waterways leading
from It to the East aud the West.
Such a waterway would
mean the extension of our coast line
Into the very heart of our country. It
would be of incalculable benefit to our
people If begun at once It can be car
vied through in timfe appreciable to
relieve the congestion of our great
freight-carrying lines of railroads
The work should lie systematically
and continuously carried forward In
accordance with some well conceived
plan The main streams should be im-
proved to the highest point of effic-
iency before tlie improvement of the
branches Is attempted; and the work
should be kept free from every taint
of recklessness or Jobbery.
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practically