tionship between the operations of the the consumers of these articles, and there Government Treasury and the business of seems to be nothing so well able to bear the the country, and too extensive a com- burden without hardship to any portion of mingling of their money, thus fostering an the people. unnatural reliance in private business upon public funds. If this scheme should be adopted it should only be done as a temporary expedient to meet an urgent necessity. Legislative and executive effort should generally be in the opposite direction and should have a tendency to divorce, as much and as fast as can safely be done, the Treasury Department from private enterprise. Of course it is not expected that unnecessary and extravagant appropriations will be made for the purpose of avoiding the accumulation of an excess of revenue. Such expenditure, beside the demoralization of all just conceptions of public duty which it entails, stimulates a habit of reckless improvidence not in the least consistent with the mission of our people or the high and beneficent purposes of our government. I have deemed it my duty to thus bring to the knowledge of my countrymen, as well as to the attention of their representatives charged with the responsibility of legislative relief, the gravity of our financial situation. The failure of the Congress heretofore to provide against the dangers which it was quite evident the very nature of the difficulty must necessarily produce, caused a condition of financial distress and apprehension since your last adjournment, which taxed to the utmost all the authority and expedients within executive control; and these appear now to be exhausted. If disaster results from the continued inaction of Congress, the responsibility must rest where it belongs. Though the situation thus far considered is fraught with danger which should be fully realized, and though it presents features of wrong to the people as well as peril to the country, it is but a result growing out of a perfectly palpable and apparent cause, constantly reproducing the same alarming circumstances-a congested national treasury and a depleted monetary condition in the business of the country. It need hardly be stated that while the present situation demands a remedy, we can only be saved from a like predicament in the future by the removal of its cause. Our scheme of taxation, by means of which this needless surplus is taken from the people and put into the public treasury, consists of a tariff or duty levied upon importations from abroad, and internal revenue taxes levied upon the consumption of tobacco and spirituous and malt liquors. It must be conceded that none of the things subjected to internal revenue taxation are, strictly speaking, necessaries; there appears to be no just complaint of this taxation by But our present tariff laws, the vicious, inequitable and illogical source of unnecessary taxation, ought to be at once revised and amended. These laws, as their primary and plain effect, raise the price to consumers of all articles imported and subject to duty, by precisely the sum paid for such duties. Thus the amount of the duty measures the tax paid by those who purchase for use these imported articles. Many of these things, however, are raised or manufactured in our own country, and the duties now levied upon foreign goods and products are called protection to these home manufactures, because they render it possible for those of our people who are manufacturers, to make these taxed articles and sell them for a price equal to that demanded for the imported goods that have paid customs duty. So it happens that while comparatively a few use the imported articles, millions of our people, who never use and never saw any of the foreign products, purchase and use things of the same kind made in this country, and pay therefor nearly or quite the same enhanced price which the duty adds to the imported articles. Those who buy imports pay the duty charged thereon into the public treasury, but the great majority of our citizens, who buy domestic articles of the same class, pay a sum at least approximately equal to this duty to the home manufacturer. This reference to the operation of our tariff laws is not made by way of instruction, but in order that we may be constantly reminded of the manner in which they impose a burden upon those who consume domestic products as well as those who consume imported articles, and thus create a tax upon all our people. It is not proposed to entirely relieve the country of this taxation. It must be extensively continued as the source of the government's income; and in a readjustment of our tariff the interests of American labor engaged in manufacture should be carefully considered, as well as the preservation of our manufacturers. It may be called protection, or by any other name, but relief from the hardships and dangers of our present tariff laws should be devised with especial precaution against imperilling the existence of our manufacturing interests. But this existence should not mean a condition which, without regard to the public welfare or a national exigency, must always insure the realization of immense profits instead of moderately profitable returns. As the volume and diversity of our national activities increase, new recuits are added to those who desire a continuation of the advantages which they conceive the present system of tatiff taxation directly affords them. So stubboruly have all efforts to reform the present condition been resisted by those of our. fellow-citizens thus engaged, that they can hardly complain of the suspicion, entertained to a certain extent, that there exists an organized combination all along the line to maintain their advantage. manufacturing industries as are claimed to be benefited by a high tariff. To these the appeal is made to save their employment and maintain their wages by resisting a change. There should be no disposition to answer such suggestions by the allegation that they are in a minority among those who labor, and therefore should forego an advantage, in the interest of low prices for the majority; their com We are in the midst of centennial celebrations, and with becoming pride we re-pensation, as it may be affected by the opjoice in American skill and ingenuity, in eration of the tariff laws, should at all times American energy and enterprise, and in the be scrupulously kept in view; and yet with wonderful natural advantages and resources slight reflection they will not overlook the developed by a century's national growth. fact that they are consumers with the rest; Yet when an attempt is made to justify a that they, too, have their own wants and scheme which permits a tax to be laid upon those of their families to supply from their every consumer in the land for the benefit earnings, and that the price of the necesof our manufacturers, quite beyond a reason-saries of life, as well as the amount of their able demand for governmental regard, it wages, will regulate the measure of their suits the purposes of advocacy to call our welfare and comfort. manufactures infant industries, still needing the highest and greatest degree of favor and fostering care that can be wrung from Federal legislation. It is also said that the increase in the price of domestic manufactures resulting from the present tariff is necessary in order that higher wages may be paid to our workingmen employed in manufactories, than are paid for what is called the pauper labor of Europe. All will acknowledge the force of an argument which involves the welfare and liberal compensation of our laboring people. Our labor is honorab 'e in the eyes of every American citizen; and as it lies at the foundation of our development and progress, it is entitled, without affectation or hypocrisy, to the utmost regard. The standard of our laborers' life should not be measured by that of any other country less favored, and they are entitled to the full share of all our advantages. By the last census it is made to appear that of the 17,392,099 of our population engaged in all kinds of industries 7,670,493 are employed in agriculture, 4,074,238 in professional and personal service, (2,934,876 of whom are domestic servants and laborers,) while 1,810,256 are employed in trade and transportation, and 3,837,112 are classed as employed in manufacturing and mining. But the reduction of taxation demanded should be so measured as not to necessitate or justify either the loss of employment by the working man nor the lessening of his wages; and the profits still remaining to the manufacturer, after a necessary readjustment, should furnish no excuse for the sacrifice of the interests of his employés either in their opportunity to work or in the diminution of their compensation. Nor can the worker in manufactures fail to understand that while a high tariff is claimed to be necessary to allow the payment of remunerative wages, it certainly results in a very large increase in the price of nearly all sorts of manufactures, which, in almost countless forms, he needs for the use of himself and his family. He receives at the desk of his employer his wages, and perhaps before he reaches his home is obliged, in a purchase for family use of an article which embraces his own labor, to return in the payment of the increase in price which the tariff permits, the hardearned compensation of many days of toil. The farmer and the agriculturist who manufacture nothing, but who pay the increased price which the tariff imposes, upon every agricultural implement, upon all he wears and upon all he uses and owns, except the increase of his flocks and herds and such things as his husbandry produces For present purposes, however, the last from the soil, is invited to aid in maintainnumber given should be considerably re- ing the present situation; and he is told duced. Without attempting to enumerate that a high duty on imported wool is necesall, it will be conceded that there should be sary for the benefit of those who have sheep deducted from those which it includes 375,- to shear, in order that the price of their 143 carpenters and joiners, 285,401 milli- wool may be increased. They of course are ners, dressmakers, and seamstresses, 172,726 not reminded that the farmer who has no blacksmiths, 133,756 tailors and tailoresses, sheep is by this scheme obliged, in his pur102,473 masons, 76,241 butchers, 41,309 chase of clothing and woolen goods, to pay bakers, 22,083 plasterers and 4,891 engaged a tribute to his fellow farmer as well as to in manufacturing agricultural implements, the manufacturer and merchant; nor is any amounting in the aggregate to 1,214,023, mention made of the fact that the sheepleaving 2,623,089 persons employed in such owners themselves and their households, must wear clothing and use other articles manufactured from the wool they sell at tariff prices, and thus as consumers must return their share of this increased price to the tradesman. the sick and well, and the young and old, and that it constitutes a tax which, with relentless grasp, is fastened upon the clothing of every man, woman, and child in the land, reasons are suggested why the removal or reduction of this duty should be included in a revision of our tariff laws. In speaking of the increased cost to the consumer of our home manufactures, resulting from a duty laid upon imported articles of the same description, the fact is not overlooked that competition among our domestic producers sometimes has the effect of keeping the price of their products below the highest limit allowed by such duty. But it is notorious that this competition is too often strangled by combinations quite prevalent at this time, and frequently called trusts, which have for their object the regulation of the supply and price of commodities made and sold by members of the combination. The people can hardly hope for any consideration in the operation of these selfish schemes. If, however, in the absence of such combination, a healthy and free competition reduces the price of any particular dutiable article of home production, below the limit which it might otherwise reach under our tariff laws, and if, with such reduced price, its manufacture continues to thrive, it is entirely evident that one thing has been discovered which should be carefully scrutinized in an effort to reduce taxation. I think it may be fairly assumed that a large proportion of the sheep owned by the farmers throughout the country are found in small flocks numbering from twenty-five to fifty. The duty on the grade of imported wool which these sheep yield, is ten cents each pound if of the value of thirty cents or less, and twelve cents if of the value of more than thirty cents. If the liberal estimate of six pounds be allowed for each fleece, the duty thereon would be sixty or seventy-two cents, and this may be taken as the utmost enhancement of its price to the farmer by reason of this duty. Eighteen dollars would thus represent the increased price of the wool from twenty-five sheep and thirty-six dollars that from the wool of fifty sheep; and at present values this addition would amount to about one-third of its price. If upon its sale the farmer receives this or a less tariff profit, the wool leaves his hands charged with precisely that sum, which in all its changes will adhere to it, until it reaches the consumer. When manufactured into cloth and other goods and material for use, its cost is not only increased to the extent of the farmer's tariff profit, but a further sum has been added for the benefit of the manufacturer under the operation of other tariff laws. In the The necessity of combination to maintain meantime the day arrives when the farmer the price of any commodity to the tariff finds it necessary to purchase woolen goods point, furnishes proof that some one is and material to clothe himself and family willing to accept lower prices for such comfor the winter. When he faces the trades-modity, and that such prices are remuneraman for that purpose he discovers that he is obliged not only to return in the way of increased prices, his tariff profit on the wool he sold, and which then perhaps lies before him in manufactured form, but that he must add a considerable sum thereto to meet a further increase in cost caused by a tariff duty on the manufacture. Thus in the end he is aroused to the fact that he has paid upon a moderate purchase, as the result of the tariff scheme, which, when he sold his wool seemed so profitable, an increase in price more than sufficient to sweep away all the tariff profit he received upon the wool he produced and sold. When the number of farmers engaged in wool-raising is compared with all the farmers in the country, and the small proportion they bear to our population is considered; when it is made apparent that, in the case of a large part of those who own sheep, the benefit of the present tariff on wool is illusory; and, above all, when it must be conceded that the increase of the cost of living caused by such a tariff, becomes a burden upon those with moderate means and the poor, the employed and the unemployed, tive; and lower prices produced by competition prove the same thing. Thus where either of these conditions exists, a case would seem to be presented for an easy reduction of taxation The considerations which have been presented touching our tariff laws are intended only to enforce an earnest recommendation that the surplus revenues of the government be prevented by the reduction of our customs duties, and, at the same time, to emphasize a suggestion that in accomplishing this purpose, we may discharge a double duty to our people by granting to them a measure of relief from tariff taxation in quarters where it is most needed and from sources where it can be most fairly and justly accorded. Nor can the presentation made of such considerations be, with any degree of fairness, regarded as evidence of unfriendliness toward our manufacturing interests, or of any lack of appreciation of their value and importance. These interests constitute a leading and most substantial element of our national greatness and furnish the proud proof of our country's progress. But if in the emer-home consumption-saving them from the gency that presses upon us our manufactur- depression, interruption in business, and ers are asked to surrender something for loss caused by a glutted domestic market, the public good and to avert disaster, their and affording their employés more certain patriotism, as well as a grateful recognition and steady labor, with its resulting quiet of advantages already afforded, should lead and contentment. them to willing coöperation. No demand The question thus imperatively presented is made that they shall forego all the bene- for solution should be approached in a fits of governmental regard; but they can- spirit higher than partisanship and considnot fail to be admonished of their duty, as ered in the light of that regard for patriotic well as their enlightened self-interest and duty which should characterize the action safety, when they are reminded of the fact of those intrusted with the weal of a conthat financial panic and collapse, to which fiding people. But the obligation to dethe present condition tends, afford no clared party policy and principle is not greater shelter or protection to our manu- wanting to urge prompt and effective action. factures than to our other important enter- Both of the great political parties now prises. Opportunity for safe. careful, and represented in the Government have, by deliberate reform is now afforded; and repeated and authoritative declarations, none of us should be unmindful of a time condemed the condition of our laws which when an abused and irritated people, heedless of those who have resisted timely and reasonable relief, may insist upon a radical and sweeping rectification of their wrongs. The difficulty attending a wise and fair revision of our tariff laws is not underestimated. It will require on the part of the Congress great labor and care, and especially a broad and national contemplation of the subject, and a patriotic disregard of such local and selfish claims as are unreasonable and reckless of the welfare of the entire country. permits the collection from the people of unnecessary revenue, and have, in the most solemn manner, promised its correction; and neither as citizens or partisans are our countrymen in a mood to condone the deliberate violation of these pledges. Our progress toward a wise conclusion will not be improved by dwelling upon the theories of protection and free trade. This savors too much of bandying epithets. It is a condition which confronts us-not a theory. Relief from this condition may involve a slight reduction of the advantages which we award our home productions, but the entire withdrawal of such advantages should not be contemplated. The question of free trade is absolutely irrelevant; and the persistent claim made in certain quarters, that all efforts to relieve the people from unjust and unnecessary taxation are schemes of so-called free-traders, is mischievous and far removed from any consideration for the public good. Under our present laws more than four thousand articles are subject to duty. Many of these do not in any way compete with our own manufactures, and many are hardly worth attention as subjects of revenue. A considerable reduction can be made in the aggregate, by adding them to the free list. The taxation of luxuries presents no features of hardship; but the necessaries of life used and consumed by all the people, the duty upon which adds to the cost of living in The simple and plain duty which we owe every home, should be greatly cheapened. the people is to reduce taxation to the necThe radical reduction of the duties im-essary expenses of an economical operation posed upon raw material used in manufac- of the government, and to restore to the tures, or its free importation, is of course an business of the country the money which important factor in any effort to reduce the price of these necessaries; it would not only relieve them from the increased cost caused by the tariff on such material, but the manufactured product being thus cheapened, that part of the tariff now laid upon such product, as a compensation to our manufacturers for the present price of raw material, could be accordingly modified. Such reduction, or free importation, would serve beside to The Constitution provides that the Preslargely reduce the revenue. It is not ap- ident "shall, from time to time, give to the parent how such a change can have any in- Congress information of the state of the jurious effect upon our manufacturers. On Union.' It has been the custom of the the contrary, it would appear to give them Executive, in compliance with this provia better chance in foreign markets with sion, to annually exhibit to the Congress, the manufacturers of other countries, who at the opening of its session, the general cheapen their wares by free material. Thus condition of the country, and to detail, with our people might have the opportunity of some particularity, the operations of the extending their sales beyond the limits of different Executive Departments. It would we hold in the treasury through the perversion of governmental powers. These things can and should be done with safety to all our industries, without danger to the opportunity for remunerative labor which our workingmen need, and with benefit to them and all our people, by cheapening their means of subsistence and increasing the measure of their comforts. be especially agreeable to follow this course at the present time, and to call attention to the valuable accomplishments of these departments during the last fiscal year. But I am much impressed with the paramount importance of the subject to which this communication has thus far been devoted, that I shall forego the addition of any other topic, and only urge upon your immediate consideration the state of the Union" as shown in the prosent condition of our treasury and our general fiscal situation, upon which every element of our safety and prosperity depends. The reports of the heads of departments, which will be submitted, contain full and explicit information touching the transac tion of the business intrusted to them, and such recommendations relating to legislation in the public interest as they deem advisable. I ask for these reports and recommendations the deliberate examination and action of the Legislative branch of the government. There are other subjects not embraced in the departmental reports demanding legislative consideration and which I should be glad to submit. Some of them, however, have been earnestly presented in previous messages, and as to them, I beg leave to repeat prior recommendations. As the law makes no provision for any report from the department of State, a brief history of the transactions of that important Department, together with other matters which it may hereafter be deemed essential to commend to the attention of the Congress, may furnish the occasion for a future communication. GROVER CLEVELAND. WASHINGTON, December 6, 1887. Mr. Blaine's Answer to Cleveland. By Cable to the N. Y. Tribune. PARIS, Dec. 7, 1887.-After reading an abstract of the President's message, laid before all Europe this morning. I saw Mr. Blaine and asked him if he would be willing to give his views upon the recommendation of the President in the form of a letter or interview. He preferred an interview, if I would agree to send him an intelligent shorthand reporter, with such questions as should give free scope for an expression of his views. The following lucid and powerful statement is the result. Mr. Blaine began by saying to the reporter: the President's recommendations. Perhaps that fact stamped the character of the message more clearly than any words of mine can. "You don't mean actual free trade without duty?" queried the reporter. "No," replied Mr. Blaine. "Nor do the London papers mean that. They simply mean that the President has recommended what in the United States is known as a revenue tariff, rejecting the protective feature as an object and not even permitting protection to result freely as an incident to revenue duties." "I don't know that I quite comprehend that last point," said the reporter. "I mean,' said Mr. Blaine, "that for the first time in the history of the United States the President recommends retaining the internal tax in order that the tariff may be forced down even below the fair revenue standard. He recommends that the tax on tobacco be retained, and thus that many millions annually shall be levied on a domestic product which would far better come from a tariff on foreign fabrics." "Then do you mean to imply that you would favor the repeal of the tobacco tax?" " 'Certainly; I mean just that," said Mr. Blaine. "I should urge that it be done at once, even before the Christmas holidays. It would in the first place bring great relief to growers of tobacco all over the country, and would, moreover, materially lessen the price of the article to consumers. Tobacco to millions of men is a necessity. The President calls it a luxury, but it is a luxury in no other sense than tea and coffee are luxuries. It is well to remember that the luxury of yesterday becomes a necessity of today. Watch, if you please, the number of men at work on the farm, in the coal mine, along the railroad, in the iron foundry, or in calling, and you will find 95 in 100 any chewing while they work. After each meal the same proportion seek the solace of a pipe or a cigar. These men not only pay the millions of the tobacco tax, but pay on every plug and every cigar an enhanced price which the tax enables the manufacturer and retailer to impose. The only excuse for such a tax is the actual necessity under which the government found itself during the war, and the years immediately following. To retain the tax now in order to destroy the protection which would incidentally flow from raising the same amount of money on foreign imports, is certainly a most extraordinary policy for our government. "I have been reading an abstract of the President's message and have been especially interested in the comments of the Well, then, Mr. Blaine, would you adLondon papers. Those papers all assume vise the repeal of the whiskey tax also?" to declare that the message is a free trade "No, I would not. Other considerations manifesto and evidently are anticipating than those of financial administration are an enlarged market for English fabrics in to be taken into account with regard to the United States as a consequence of whiskey. There is a moral side to it. To |