They call for a definite

I have thus attempted, after fourteen years of absolute calm, to
recount the prominent details of the strife; and I hope that interest
in the subject is still sufficient to justify me in a further brief
reference to some features of the dispute and certain incidents that
followed it, which may aid to a better appreciation of its true
character and motive.

Of the elaborate speeches made in support of the resolutions and the
committee’s majority report, seven dealt more or less prominently
with the President’s Civil Service reform professions and his pledges
against the removal of officials on purely partizan grounds. It seems
to have been assumed that these pledges had been violated. At any rate,
without any evidence worthy of the name, charges of such violation
ranged all the way from genteel insinuation to savage accusation.
Senators who would have stoutly refused to vote for the spoils system
broadly intimated or openly declared that if suspensions had been
made confessedly on partizan grounds they would have interposed no
opposition. The majority seem to have especially admired and applauded
the antics of one of their number, who, in intervals of lurid and
indiscriminate vituperation, gleefully mingled ridicule for Civil
Service reform with praise of the forbidding genius of partizan spoils.
In view of these deliverances and as bearing upon their relevancy,
as well as indicating their purpose, let me again suggest that the
issue involved in the discussion as selected by the majority of the
Committee on the Judiciary, and distinctly declared in their report,
was whether, as a matter of right, or, as the report expresses it, as
within “constitutional competence,” either House of Congress should
“have access to the official papers and documents in the various public
offices of the United States, created by laws enacted by themselves.”
It will be readily seen that if the question was one of senatorial
right, the President’s Civil Service reform pledges had no honest or
legitimate place in the discussion.

The debate and the adoption of the resolutions reported by the
committee caused no surrender of the Executive position. Nevertheless,
confirmations of those nominated in place of suspended officers soon
began, and I cannot recall any further embarrassment or difficulty
on that score. I ought to add, however, that in many cases, at least,
these confirmations were accompanied by reports from the committee
to which they had been referred, stating that the late incumbent had
been suspended for “political reasons,” or on account of “offensive
partizanship,” or for a like reason, differently expressed, and that
nothing was alleged against them affecting their personal character.
If the terms thus used by the committee in designating causes for
suspension mean that the persons suspended were guilty of offensive
partizanship or political offenses, as distinguished from personal
offenses and moral or official delinquencies, I am satisfied with the
statement. And here it occurs to me to suggest that if offenses and
moral or official delinquencies, not partizan in their nature, had
existed, they would have been subjects for official inspection and
report, and such reports, being official documents, would have been
submitted to the committee or to the Senate, according to custom, and
would have told their own story and excluded committee comment.

It is worth recalling, when referring to committee reports on
nomination, that they belong to the executive business of the Senate,
and are, therefore, among the secrets of that body. Those I have
mentioned, nevertheless, were by special order made public, and
published in the proceedings of the Senate in open session. This
extraordinary, if not unprecedented, action, following long after
the conclusion of the dispute, easily interprets its own intent, and
removes all covering from a design to accomplish partizan advantage.
The declaration of the resolutions that it was the duty of the Senate
“to refuse its advice and consent to the proposed removal of officers”
when the papers and documents relating to their supposed misconduct
were withheld, was abandoned, and the irrevocable removal of such
officers by confirmation of their successors was entered upon, with or
without the much-desired papers and documents, and was supplemented by
the publication of committee reports, from which the secrecy of the
executive session had been removed, to the end that, pursuant to a
fixed determination, an unfavorable senatorial interpretation might be
publicly given to the President’s action in making suspensions.

I desire to call attention to one other incident connected with the
occurrences already narrated. On the 14th of December, 1885,–prior to
the first request or demand upon any executive department relating
to suspensions, and of course before any controversy upon the subject
arose,–a bill was introduced in the Senate by one of the most
distinguished and able members of the majority in that body, and also
a member of its Committee on the Judiciary, for the total and complete
repeal of the law of 1869, which, it will be remembered, furnished the
basis for the contention we have considered. This repealing bill was
referred to the Senate Committee on the Judiciary, where it slumbered
until the 21st of June, 1886,–nearly three months after the close of
the contention,–when it was returned to the Senate with a favorable
report, the chairman of the committee alone dissenting. When the bill
was presented for discussion, the Senator who introduced it explained
its object as follows:

This bill repeals what is left of what is called the Tenure of
Office act, passed under the administration of Andrew Johnson,
and as a part of the contest with that President. It leaves
the law as it was from the beginning of the Government until
that time, and it repeals the provision which authorizes the
suspension of civil officers and requires the submission of
that suspension to the Senate.

On a later day, in discussing the bill, he said, after referring to the
early date of its introduction:

It did not seem to me to be quite becoming to ask the Senate to
deal with this general question while the question which arose
between the President and the Senate as to the interpretation
and administration of the existing law was pending. I thought
as a party man that I had hardly the right to interfere with
the matter which was under the special charge of my honorable
friend from Vermont, by challenging a debate upon the general
subject from a different point of view. This question has
subsided and is past, and it seems to me now proper to ask the
Senate to vote upon the question whether it will return to the
ancient policy of the Government, to the rule of public conduct
which existed from 1789 until 1867, and which has practically
existed, notwithstanding the condition of the statute-book,
since the accession to power of General Grant on the 4th of
March, 1869.

The personnel of the committee which reported favorably upon this
repealing bill had not been changed since all the members of it
politically affiliating with the majority in the Senate joined in
recommending the accusatory report and resolutions, which, when
adopted, after sharp and irritating discussion, caused the question
between the President and the Senate, in the language of the introducer
of the repealing bill, to “subside.”

This repealing act passed the Senate on the 17th of December, 1886, by
thirty affirmative votes against twenty-two in the negative. A short
time afterward it passed in the House of Representatives by a majority
of one hundred and five.

Thus was an unpleasant controversy happily followed by an expurgation
of the last pretense of statutory sanction to an encroachment upon
constitutional Executive prerogatives, and thus was a time-honored
interpretation of the Constitution restored to us. The President, freed
from the Senate’s claim of tutelage, became again the independent agent
of the people, representing a coördinate branch of their Government,
charged with responsibilities which, under his oath, he ought not
to avoid or divide with others, and invested with powers, not to be
surrendered, but to be used, under the guidance of patriotic intention
and an unclouded conscience.

THE GOVERNMENT IN THE CHICAGO STRIKE OF 1894

I

The President inaugurated on the fourth day of March, 1893, and
those associated with him as Cabinet officials, encountered, during
their term of executive duty, unusual and especially perplexing
difficulties. The members of that administration who still survive,
in recalling the events of this laborious service, cannot fail to fix
upon the years 1894 and 1895 as the most troublous and anxious of
their incumbency. During those years unhappy currency complications
compelled executive resort to heroic treatment for the preservation of
our nation’s financial integrity, and forced upon the administration a
constant, unrelenting struggle for sound money; a long and persistent
executive effort to accomplish beneficent and satisfactory tariff
reform so nearly miscarried as to bring depression and disappointment
to the verge of discouragement; and it was at the close of the year
1895 that executive insistence upon the Monroe Doctrine culminated
in a situation that gave birth to solemn thoughts of war. Without
attempting to complete the list of troubles and embarrassments that
beset the administration during these luckless years, I have reserved
for separate and more detailed treatment one of its incidents not yet
mentioned, which immensely increased executive anxiety and foreboded
the most calamitous and far-reaching consequences.

In the last days of June, 1894, a very determined and ugly labor
disturbance broke out in the city of Chicago. Almost in a night it grew
to full proportions of malevolence and danger. Rioting and violence
were its early accompaniments; and it spread so swiftly that within
a few days it had reached nearly the entire Western and Southwestern
sections of our country. Railroad transportation was especially
involved in its attacks. The carriage of United States mails was
interrupted, interstate commerce was obstructed, and railroad property
was riotously destroyed.

This disturbance is often called “The Chicago Strike.” It is true that
its beginning was in that city; and the headquarters of those who
inaugurated it and directed its operations were located there; but the
name thus given to it is an entire misnomer so far as it applies to the
scope and reach of the trouble. Railroad operations were more or less
affected in twenty-seven States and Territories; and in all these the
interposition of the general Government was to a greater or less extent
invoked.

This wide-spread trouble had its inception in a strike by the employees
of the Pullman Palace Car Company, a corporation located and doing
business at the town of Pullman, which is within the limits of the city
of Chicago. This company was a manufacturing corporation–or at least
it was not a railroad corporation. Its main object was the operation
and running of sleeping- and parlor-cars upon railroads under written
contracts; but its charter contemplated the manufacture of cars as
well; and soon after its incorporation it began the manufacture of its
own cars and, subsequently, the manufacture of cars for the general
market.

The strike on the part of the employees of this company began on the
eleventh day of May, 1894, and was provoked by a reduction of wages.

The American Railway Union was organized in the summer of 1893.
It was professedly an association of all the different classes of
railway employees. In its scope and intent it was the most compact
and effective organization of the kind ever attempted. Its purpose
was a thorough unification of defensive and offensive effort among
railway employees under one central direction, and the creation of
a combination embracing all such employees, which should make the
grievances of any section of its membership a common cause. Those
prominent in this project estimated that various other organizations
of railroad employees then existing had a membership of 102,000 in
the United States and neighboring countries; and they claimed that
these brotherhoods, because of divided councils and for other reasons,
were ineffective, and that nearly 1,000,000 railroad employees still
remained unorganized.

The wonderful growth of this new combination is made apparent by the
fact that between the month of August, 1893, and the time it became
involved in the Pullman strike, in June, 1894, it had enrolled nearly
150,000 members.

The employees of the Pullman Palace Car Company could not on any
reasonable and consistent theory be regarded as eligible to membership
in an organization devoted to the interests of railway employees; and
yet, during the months of March, April, and May, 1894, it appears that
nearly 4000 of these employees were enrolled in the American Railway
Union.

This, to say the least of it, was an exceedingly unfortunate
proceeding, since it created a situation which implicated in a
comparatively insignificant quarrel between the managers of an
industrial establishment and their workmen the large army of the
Railway Union. It was the membership of these workmen in the Railway
Union, and the union’s consequent assumption of their quarrel, that
gave it the proportions of a tremendous disturbance, paralyzing the
most important business interests, obstructing the functions of the
Government, and disturbing social peace and order….

No injury to the property of the Pullman Palace Car Company was done or
attempted while the strike was confined to its employees; and during
that time very little disorder of any kind occurred.

It so happened, however, that in June, 1894, after the strike at
Pullman had continued for about one month, a regular stated convention
of the American Railway Union was held in the city of Chicago, which
was attended by delegates from local branches of the organization in
different States, as well as by representatives of its members among
the employees of the Pullman Palace Car Company. At this convention the
trouble at Pullman was considered, and after earnest efforts on the
part of the Railway Union to bring about a settlement, a resolution
was, on the twenty-second day of June, passed by the convention,
declaring that unless the Pullman Palace Car Company should adjust the
grievances of its employees before noon of the twenty-sixth day of
June, the members of the American Railway Union would, after that date,
refuse to handle Pullman cars and equipment.

The twenty-sixth day of June arrived without any change in the attitude
of the parties to the Pullman controversy; and thereupon the order made
by the American Railway Union forbidding the handling of Pullman cars,
became operative throughout its entire membership.

At this time the Pullman Palace Car Company was furnishing drawing-room
and sleeping-car accommodations to the traveling public under contracts
with numerous railway companies, and was covering by this service
about one hundred and twenty-five thousand miles of railway, or
approximately three fourths of all the railroad mileage of the country.
The same railroad companies which had contracted to use these Pullman
cars upon their lines had contracts with the United States Government
for the carriage of mails, and were, of course, also largely engaged
in interstate commerce. It need hardly be said that, of necessity, the
trains on which the mails were carried and which served the purpose of
interstate commerce were, very generally, those to which the Pullman
cars were also attached.

The president of the Railway Union was one Eugene V. Debs. In a sworn
statement afterward made he gave the following description of the
results of the interference of the union in the Pullman dispute:

The employees, obedient to the order of the convention, at
once, on the 26th, refused to haul Pullman cars. The switchmen,
in the first place, refused to attach a Pullman car to a train,
and that is where the trouble began; and then, when a switchman
would be discharged for that, they would all simultaneously
quit, as they had agreed to do. One department after another
was involved until the Illinois Central was practically
paralyzed, and the Rock Island and other roads in their turn.
Up to the first day of July, or after the strike had been in
progress five days, the railway managers, as we believe, were
completely defeated. Their immediate resources were exhausted,
their properties were paralyzed, and they were unable to
operate their trains. Our men were intact at every point, firm,
quiet, and yet determined, and no sign of violence or disorder
anywhere. That was the condition on the thirtieth day of June
and the first day of July.

The officers of the Railway Union from their headquarters in the city
of Chicago gave directions for the maintenance and management of the
strike, which were quickly transmitted to distant railroad points and
were there promptly executed. As early as the 28th of June, two days
after the beginning of the strike ordered by the Railway Union at
Chicago, information was received at Washington from the Post-Office
Department that on the Southern Pacific System, between Portland
and San Francisco, Ogden and San Francisco, and Los Angeles and San
Francisco, the mails were completely obstructed, and that the strikers
refused to permit trains to which Pullman cars were attached to run
over the lines mentioned. Thereupon Attorney-General Olney immediately
sent the following telegraphic despatch to the United States district
attorneys in the State of California:

WASHINGTON, D. C., June 28, 1894.

See that the passage of regular trains, carrying United States
mails in the usual and ordinary way, as contemplated by the
act of Congress and directed by the Postmaster-General, is not
obstructed. Procure warrants or any other available process
from United States courts against any and all persons engaged
in such obstructions, and direct the marshal to execute the
same by such number of deputies or such posse as may be
necessary.

On the same day, and during a number of days immediately following,
complaints of a similar character, sometimes accompanied by charges
of forcible seizure of trains and other violent disorders, poured in
upon the Attorney-General from all parts of the West and Southwest.
These complaints came from post-office officials, from United States
marshals and district attorneys, from railroad managers, and from
other officials and private citizens. In all cases of substantial
representation of interference with the carriage of mails, a despatch
identical with that already quoted was sent by the Attorney-General to
the United States district attorneys in the disturbed localities; and
this was supplemented, whenever necessary, by such other prompt action
as the different emergencies required.

I shall not enter upon an enumeration of all the disorders and
violence, the defiance of law and authority, and the obstructions of
national functions and duties, which occurred in many localities as
a consequence of this labor contention, thus tremendously reinforced
and completely under way. It is my especial purpose to review the
action taken by the Government for the maintenance of its own authority
and the protection of the interests intrusted to its keeping, so far
as they were endangered by this disturbance; and I do not intend to
specifically deal with the incidents of the strike except in so far as
a reference to them may be necessary to show conditions which not only
justified but actually obliged the Government to resort to stern and
unusual measures in the assertion of its prerogatives.

Inasmuch, therefore, as the city of Chicago was the birthplace of the
disturbance and the home of its activities, and because it was the
field of its most pronounced and malign manifestations, as well as the
place of its final extinction, I shall meet the needs of my subject
if I supplement what has been already said by a recital of events
occurring at this central point. In doing this, I shall liberally
embody documents, orders, instructions, and reports which I hope will
not prove tiresome, since they supply the facts I desire to present,
at first hand and more impressively than they could be presented by any
words of mine.

Owing to the enforced relationship of Chicago to the strike which
started within its borders, and because of its importance as a center
of railway traffic, Government officials at Washington were not
surprised by the early and persistent complaints of mail and interstate
commerce obstructions which reached them from that city. It was from
the first anticipated that this would be the seat of the most serious
complications, and the place where the strong arm of the law would
be most needed. In these circumstances it would have been a criminal
neglect of duty if those charged with the protection of governmental
agencies and the enforcement of orderly obedience and submission to
Federal authority, had been remiss in preparations for any emergency in
that quarter.

On the thirtieth day of June the district attorney at Chicago reported
by telegraph that mail trains in the suburbs of Chicago were, on the
previous night, stopped by strikers, that an engine had been cut off
and disabled, and that conditions were growing more and more likely
to culminate in the stoppage of all trains; and he recommended that
the marshal be authorized to employ a force of special deputies who
should be placed on trains to protect mails and detect the parties
guilty of such interference. In reply to this despatch Attorney-General
Olney on the same day authorized the marshal to employ additional
deputies as suggested, and designated Edwin Walker, an able and
prominent attorney in Chicago, as special counsel for the Government,
to assist the district attorney in any legal proceedings that might
be instituted. He also notified the district attorney of the steps
thus taken, and enjoined upon him that “action ought to be prompt and
vigorous,” and also directed him to confer with the special counsel
who had been employed. In a letter of the same date addressed to this
special counsel, the Attorney-General, in making suggestions concerning
legal proceedings, wrote: “It has seemed to me that if the rights of
the United States were vigorously asserted in Chicago, the origin and
center of the demonstration, the result would be to make it a failure
everywhere else, and to prevent its spread over the entire country”;
and in that connection he indicated that it might be advisable,
instead of relying entirely upon warrants issued under criminal
statutes against persons actually guilty of the offense of obstructing
United States mails, to apply to the courts for injunctions which
would restrain and prevent any attempt to commit such offense. This
suggestion contemplated the inauguration of legal proceedings in a
regular and usual way to restrain those prominently concerned in the
interference with the mails and the obstruction of interstate commerce,
basing such proceedings on the proposition that, under the Constitution
and laws, these subjects were in the exclusive care of the Government
of the United States, and that for their protection the Federal
courts were competent under general principles of law to intervene by
injunction; and on the further ground that under an act of Congress,
passed July 2, 1890, conspiracies in restraint of trade or commerce
among the several States were declared to be illegal, and the circuit
courts of the United States were therein expressly given jurisdiction
to prevent and restrain such conspiracies.

On the first day of July the district attorney reported to the
Attorney-General that he was preparing a bill of complaint to be
presented to the court the next day, on an application for an
injunction. He further reported that very little mail and no freight
was moving, that the marshal was using all his force to prevent
riots and the obstruction of tracks, and that this force was clearly
inadequate. On the same day the marshal reported that the situation was
desperate, that he had sworn in over four hundred deputies, that many
more would be required to protect mail trains, and that he expected
great trouble the next day. He further expressed the opinion that one
hundred riot guns were needed.

Upon the receipt of these reports, and anticipating an attempt to serve
injunctions on the following day, the Attorney-General immediately sent
a despatch to the district attorney directing him to report at once
if the process of the court should be resisted by such force as the
marshal could not overcome, and suggesting that the United States judge
should join in such report. He at the same time sent a despatch to the
special counsel requesting him to report his view of the situation as
early as the forenoon of the next day.

In explanation of these two despatches it should here be said that
the desperate character of this disturbance was not in the least
underestimated by executive officials at Washington; and it must be
borne in mind that while menacing conditions were moving swiftly and
accumulating at Chicago, like conditions, inspired and supported from
that central point, existed in many other places within the area of the
strike’s contagion.

Of course it was hoped by those charged with the responsibility of
dealing with the situation, that a direct assertion of authority by the
marshal and a resort to the restraining power of the courts would prove
sufficient for the emergency. Notwithstanding, however, an anxious
desire to avoid measures more radical, the fact had not been overlooked
that a contingency might occur which would compel a resort to military
force. The key to these despatches of the Attorney-General is found in
the determination of the Federal authorities to overcome by any lawful
and constitutional means all resistance to governmental functions as
related to the transportation of mails, the operation of interstate
commerce, and the preservation of the property of the United States.

The Constitution requires that the United States shall protect each of
the States against invasion, “and on application of the legislature,
or of the executive (when the legislature cannot be convened), against
domestic violence.” There was plenty of domestic violence in the city
of Chicago and in the State of Illinois during the early days of
July, 1894; but no application was made to the Federal Government for
assistance. It was probably a very fortunate circumstance that the
presence of United States soldiers in Chicago at that time did not
depend upon the request or desire of Governor Altgeld.

Section 5298 of the Revised Statutes of the United States provides:
“Whenever, by reason of unlawful obstructions, combinations or
assemblages of persons, or rebellion against the authority of the
United States, it shall become impracticable in the judgment of the
President to enforce, by the ordinary course of judicial proceedings,
the laws of the United States within any State or Territory, it
shall be lawful for the President to call forth the militia of any
or all of the States, and to employ such parts of the land or naval
forces of the United States as he may deem necessary to enforce the
faithful execution of the laws of the United States, or to suppress
such rebellion, in whatever State or Territory thereof the laws of
the United States may be forcibly opposed, or the execution thereof
be forcibly obstructed”; and Section 5299 provides: “Whenever any
insurrection, domestic violence, unlawful combinations or conspiracies
in any State … opposes or obstructs the laws of the United States,
or the due execution thereof, or impedes or obstructs the due course
of justice under the same, it shall be lawful for the President, and
it shall be his duty, to take such measures, by the employment of the
militia, or the land and naval forces of the United States, or of
either, or by other means as he may deem necessary, for the suppression
of such insurrection, domestic violence or combinations.”

II

It was the intention of the Attorney-General to suggest in these
despatches that immediate and authoritative information should be given
to the Washington authorities if a time should arrive when, under the
sanction of general executive authority, or the constitutional and
statutory provisions above quoted, a military force would be necessary
at the scene of disturbance.

On the 2d of July, the day after these despatches were sent,
information was received from the district attorney and special counsel
that a sweeping injunction had been granted against Eugene V. Debs,
president of the American Railway Union, and other officials of that
organization, together with parties whose names were unknown, and
that the writs would be served that afternoon. The special counsel
also expressed the opinion that it would require Government troops to
enforce the orders of the court and protect the transportation of mails.

Major-General Schofield was then in command of the army; and, after a
consultation with him, in which the Attorney-General and the Secretary
of War took part, I directed the issuance of the following order by
telegraph to General Nelson A. Miles, in command of the Military
Department of Missouri, with headquarters at Chicago:

HEADQUARTERS OF THE ARMY.
WASHINGTON, July 2, 1894.

_To the Commanding-General,
Department of Missouri,
Chicago, Ill._

You will please make all necessary arrangements confidentially
for the transportation of the entire garrison at Fort
Sheridan–infantry, cavalry, and artillery–to the lake front
in the city of Chicago. To avoid possible interruption of the
movement by rail and by marching through a part of the city, it
may be advisable to bring them by steam-boat. Please consider
this matter and have the arrangements perfected without delay.
You may expect orders at any time for the movement. Acknowledge
receipt and report in what manner movement is to be made.

J. M. SCHOFIELD,
_Major-General Commanding_.

It should by no means be inferred from this despatch that it had been
definitely determined that the use of a military force was inevitable.
It was still hoped that the effect of the injunction would be such that
this alternative might be avoided. A painful emergency is created
when public duty forces the necessity of placing trained soldiers
face to face with riotous opposition to the general Government, and
an acute and determined defiance to law and order. This course, once
entered upon, admits of no backward step; and an appreciation of the
consequences that may ensue cannot fail to oppress those responsible
for its adoption with sadly disturbing reflections. Nevertheless, it
was perfectly plain that, whatever the outcome might be, the situation
positively demanded such precaution and preparation as would insure
readiness and promptness in case the presence of a military force
should finally be found necessary.

On the morning of the next day, July 3, the Attorney-General received a
letter from Mr. Walker, the special counsel, in which, after referring
to the issuance of the injunctions and setting forth that the marshal
was engaged in serving them, he wrote:

I do not believe that the marshal and his deputies can protect
the railroad companies in moving their trains, either freight
or passenger, including, of course, the trains carrying United
States mails. Possibly, however, the service of the writ of
injunction will have a restraining influence upon Debs and
other officers of the association. If it does not, from
present appearances, I think it is the opinion of all that the
orders of the court cannot be enforced except by the aid of the
regular army.

Thereupon the Attorney-General immediately sent this despatch to the
district attorney:

I trust use of United States troops will not be necessary. If
it becomes necessary, they will be used promptly and decisively
upon the justifying facts being certified to me. In such case,
if practicable, let Walker and the marshal and United States
judge join in statement as to the exigency.

A few hours afterward the following urgent and decisive despatch
from the marshal, endorsed by a judge of the United States court
and the district attorney and special counsel, was received by the
Attorney-General.

CHICAGO, ILL., July 3, 1894.

Hon. RICHARD OLNEY, _Attorney-General_,
Washington, D. C.:

When the injunction was granted yesterday, a mob of from two
to three thousand held possession of a point in the city near
the crossing of the Rock Island by other roads, where they had
already ditched a mail-train, and prevented the passing of any
trains, whether mail or otherwise. I read the injunction writ
to this mob and commanded them to disperse. The reading of
the writ met with no response except jeers and hoots. Shortly
after, the mob threw a number of baggage-cars across the track,
since when no mail-train has been able to move. I am unable to
disperse the mob, clear the tracks, or arrest the men who were
engaged in the acts named, and believe that no force less than
the regular troops of the United States can procure the passage
of the mail-trains, or enforce the orders of the courts. I
believe people engaged in trades are quitting employment
to-day, and in my opinion will be joining the mob to-night and
especially to-morrow; and it is my judgment that the troops
should be here at the earliest moment. An emergency has arisen
for their presence in this city.

J. W. ARNOLD,
_United States Marshal_.

We have read the foregoing, and from that information, and
other information that has come to us, believe that an
emergency exists for the immediate presence of United States
troops.

P. S. GROSSCUP, _Judge_.
EDWIN WALKER, }
THOMAS E. MILCHIST,} _Attys_.

In the afternoon of the same day the following order was telegraphed
from army headquarters in the city of Washington:

WAR DEPARTMENT,
HEADQUARTERS OF THE ARMY.
WASHINGTON, D. C., July 3, 1894,
4 o’clock P.M.

TO MARTIN, _Adjutant-General_,
Headquarters Department of Missouri,
Chicago, Ill.

It having become impracticable in the judgment of the President
to enforce by the ordinary course of judicial proceedings the
laws of the United States, you will direct Colonel Crofton to
move his entire command at once to the city of Chicago (leaving
the necessary guard at Fort Sheridan), there to execute the
orders and processes of the United States court, to prevent
the obstruction of the United States mails, and generally
to enforce the faithful execution of the laws of the United
States. He will confer with the United States marshal, the
United States district attorney, and Edwin Walker, special
counsel. Acknowledge receipt and report action promptly. By
order of the President.

J. M. SCHOFIELD, _Major-General_.

Immediately after this order was issued, the following despatch was
sent to the district attorney by the Attorney-General:

Colonel Crofton’s command ordered to Chicago by the President.
As to disposition and movement of troops, yourself, Walker, and
the marshal should confer with Colonel Crofton and with Colonel
Martin, adjutant-general at Chicago. While action should
be prompt and decisive, it should of course be kept within
the limits provided by the Constitution and laws. Rely upon
yourself and Walker to see that this is done.

Colonel Martin, adjutant-general at Chicago, reported, the same night
at half-past nine o’clock, that the order for the movement of troops
was, immediately on its receipt by him, transmitted to Fort Sheridan,
and that Colonel Crofton’s command started for Chicago at nine o’clock.

During the forenoon of the next day, July 4, Colonel Martin advised the
War Department that Colonel Crofton reported his command in the city of
Chicago at 10:15 that morning. After referring to the manner in which
the troops had been distributed, this officer added: “People seem to
feel easier since arrival of troops.”

General Miles, commanding the department, arrived in Chicago the same
morning, and at once assumed direction of military movements. In
the afternoon of that day he sent a report to the War Department at
Washington, giving an account of the disposition of troops, recounting
an unfavorable condition of affairs, and recommending an increase of
the garrison at Fort Sheridan sufficient to meet any emergency.

In response to this despatch General Miles was immediately authorized
to order six companies of infantry from Fort Leavenworth, in Kansas,
and two companies from Fort Brady, in Michigan, to Fort Sheridan.

On the fifth day of July he reported that a mob of over two thousand
had gathered that morning at the stock-yards, crowded among the troops,
obstructed the movement of trains, knocked down a railroad official,
and overturned about twenty freight-cars, which obstructed all freight
and passenger traffic in the vicinity of the stock-yards, and that the
mob had also derailed a passenger-train on the Pittsburg, Fort Wayne
and Chicago Railroad, and burned switches. To this recital of violent
demonstrations he added the following statement:

The injunction of the United States court is openly defied,
and unless the mobs are dispersed by the action of the police
or they are fired upon by United States troops, more serious
trouble may be expected, as the mob is increasing and becoming
more defiant.

In view of the situation as reported by General Miles, a despatch was
sent to him by General Schofield directing him to concentrate his
troops in order that they might act more effectively in the execution
of orders theretofore given, and in the protection of United States
property. This despatch concluded as follows:

The mere preservation of peace and good order in the city is,
of course, the province of the city and state authorities.

The situation on the sixth day of July was thus described in a despatch
sent in the afternoon of that day by General Miles to the Secretary of
War:

In answer to your telegram, I report the following: Mayor
Hopkins last night issued a proclamation prohibiting
riotous assemblies and directing the police to stop people
from molesting railway communication. Governor Altgeld has
ordered General Wheeler’s brigade on duty in Chicago to
support the Mayor’s authority. So far, there have been no
large mobs like the one of yesterday, which moved from 51st
Street to 18th Street before it dispersed. The lawlessness
has been along the line of the railways, destroying and
burning more than one hundred cars and railway buildings,
and obstructing transportation in various ways, even to the
extent of cutting telegraph lines. United States troops have
dispersed mobs at 51st Street, Kensington, and a company of
infantry is moving along the Rock Island to support a body of
United States marshals in making arrests for violating the
injunction of the United States court. Of the twenty-three
roads centering in Chicago, only six are unobstructed in
freight, passenger, and mail transportation. Thirteen are at
present entirely obstructed, and ten are running only mail-
and passenger-trains. Large numbers of trains moving in and
out of the city have been stoned and fired upon by mobs, and
one engineer killed. There was a secret meeting to-day of
Debs and the representatives of labor unions considering the
advisability of a general strike of all labor unions. About
one hundred men were present at that meeting. The result is
not yet known. United States troops are at the stock-yards,
Kensington, Blue Island, crossing of 51st Street, and have
been moving along some of the lines: the balance, eight
companies of infantry, battery of artillery, and one troop
of cavalry, are camped on Lake Front Park, ready for any
emergency and to protect Government buildings and property. It
is learned from the Fire Department, City Hall, that a party of
strikers has been going through the vicinity from 14th to 41st
streets and Stewart Avenue freight-yards, throwing gasoline on
freight-cars all through that section. Captain Ford, of the
Fire Department, was badly stoned this morning. Troops have
just dispersed a mob of incendiaries on Fort Wayne tracks, near
51st Street, and fires that were started have been suppressed.
Mob just captured mail-train at 47th Street, and troops sent to
disperse them.

On the eighth day of July, in view of the apparently near approach of
a crisis which the Government had attempted to avoid, the following
Executive Proclamation was issued and at once extensively published in
the city of Chicago:

Whereas, by reason of unlawful obstruction, combinations and
assemblages of persons, it has become impracticable, in the
judgment of the President, to enforce, by the ordinary course
of judicial proceedings, the laws of the United States within
the State of Illinois, and especially in the city of Chicago
within said State; and

Whereas, for the purpose of enforcing the faithful execution of
the laws of the United States and protecting its property and
removing obstructions to the United States mails in the State
and city aforesaid, the President has employed a part of the
military forces of the United States:–

Now, therefore, I, Grover Cleveland, President of the United
States, do hereby admonish all good citizens, and all persons
who may be or may come within the City and State aforesaid,
against aiding, countenancing, encouraging, or taking any part
in such unlawful obstructions, combinations, and assemblages;
and I hereby warn all persons engaged in or in any way
connected with such unlawful obstructions, combinations,
and assemblages to disperse and retire peaceably to their
respective abodes on or before twelve o’clock noon of the 9th
day of July instant.

Those who disregard this warning and persist in taking part
with a riotous mob in forcibly resisting and obstructing the
execution of the laws of the United States, or interfering with
the functions of the Government, or destroying or attempting to
destroy the property belonging to the United States or under
its protection, cannot be regarded otherwise than as public
enemies.

Troops employed against such a riotous mob will act
with all the moderation and forbearance consistent with
the accomplishment of the desired end; but the stern
necessities that confront them will not with certainty permit
discrimination between guilty participants and those who are
mingling with them from curiosity and without criminal intent.
The only safe course, therefore, for those not actually
participating, is to abide at their homes, or at least not to
be found in the neighborhood of riotous assemblages.

While there will be no vacillation in the decisive treatment
of the guilty, this warning is especially intended to protect
and save the innocent.

On the 10th of July, Eugene V. Debs, the president of the American
Railway Union, together with its vice-president, general secretary, and
one other who was an active director, were arrested upon indictments
found against them for complicity in the obstruction of mails and
interstate commerce. Three days afterward our special counsel expressed
the opinion that the strike was practically broken. This must not
be taken to mean, however, that peace and quiet had been completely
restored or that the transportation of mails and the activities of
interstate commerce were entirely free from interruption. It was only
the expression of a well-sustained and deliberate expectation that the
combination of measures already inaugurated, and others contemplated
in the near future, would speedily bring about a termination of the
difficulty.

On the seventeenth day of July an information was filed in the United
States Circuit Court at Chicago against Debs and the three other
officials of the Railway Union who had been arrested on indictment
a few days before, but were then at large on bail. This information
alleged that these parties had been guilty of open, continued, and
defiant disobedience of the injunction which was served on them July
3, forbidding them to do certain specified acts tending to incite and
aid the obstruction of the carriage of mails and the operation of
interstate commerce. On the footing of this information these parties
were brought before the court to show cause why they should not be
punished for contempt in disobeying the injunction. Instead of giving
bail for their freedom pending the investigation of this charge against
them, as they were invited to do, they preferred to be committed to
custody–perhaps intending by such an act of martyrdom either to revive
a waning cause, or to gain a plausible and justifying excuse for
the collapse of their already foredoomed movement. Debs himself, in
speaking of this event afterward, said: “As soon as the employees found
that we were arrested and taken from the scene of action they became
demoralized, and that ended the strike.”

That the strike ended about the time of this second arrest is
undoubtedly true; for, during the few days immediately preceding and
following the seventeenth day of July, reports came from nearly all
the localities to which the strike had spread, indicating its defeat
and the accomplishment of all the purposes of the Government’s
interference. The successful assertion of national authority was
conclusively indicated when on the twentieth day of July the last of
the soldiers of the United States who had been ordered for duty at the
very center of opposition and disturbance, were withdrawn from Chicago
and returned to the military posts to which they were attached.

I hope I have been successful thus far in my effort satisfactorily to
exhibit the extensive reach and perilous tendency of the convulsion
under consideration, the careful promptness which characterized the
interference of the Government, the constant desire of the national
administration to avoid extreme measures, the scrupulous limitation
of its interference to purposes which were clearly within its
constitutional competency and duty, and the gratifying and important
results of its conservative but stern activity.

I must not fail to mention here as part of the history of this
perplexing affair, a contribution made by the governor of Illinois to
its annoyances. This official not only refused to regard the riotous
disturbances within the borders of his State as a sufficient cause for
an application to the Federal Government for its protection “against
domestic violence” under the mandate of the Constitution, but he
actually protested against the presence of Federal troops sent into the
State upon the general Government’s own initiative and for the purpose
of defending itself in the exercise of its well-defined legitimate
functions.

On the fifth day of July, twenty-four hours after our soldiers had been
brought to the city of Chicago, pursuant to the order of July 3d, I
received a long despatch from Governor Altgeld, beginning as follows:

I am advised that you have ordered Federal troops to go into
service in the State of Illinois. Surely the facts have not
been correctly presented to you in this case or you would not
have taken the step; for it is entirely unnecessary and, as it
seems to me, unjustifiable. Waiving all question of courtesy,
I will say that the State of Illinois is not only able to take
care of itself, but it stands ready to-day to furnish the
Federal Government any assistance it may need elsewhere.

This opening sentence was followed by a lengthy statement which so far
missed actual conditions as to appear irrelevant and, in some parts,
absolutely frivolous.

This remarkable despatch closed with the following words:

As Governor of the State of Illinois, I protest against this
and ask the immediate withdrawal of Federal troops from active
duty in this State. Should the situation at any time get so
serious that we cannot control it with the State forces, we
will promptly and freely ask for Federal assistance; but
until such time I protest with all due deference against this
uncalled-for reflection upon our people, and again ask for the
immediate withdrawal of these troops.

Immediately upon the receipt of this communication, I sent to Governor
Altgeld the following reply:

Federal troops were sent to Chicago in strict accordance with
the Constitution and the laws of the United States, upon the
demand of the Post-Office Department that obstructions of the
mails should be removed, and upon the representation of the
judicial officers of the United States that process of the
Federal courts could not be executed through the ordinary
means, and upon abundant proof that conspiracies existed
against commerce between the States. To meet these conditions,
which are clearly within the province of Federal authority, the
presence of Federal troops in the city of Chicago was deemed
not only proper but necessary; and there has been no intention
of thereby interfering with the plain duty of the local
authorities to preserve the peace of the city.

III

In response to this the governor, evidently unwilling to allow the
matter at issue between us to rest without a renewal of argument
and protest, at once addressed to me another long telegraphic
communication, evidently intended to be more severely accusatory and
insistent than its predecessor. Its general tenor may be inferred from
the opening words:

Your answer to my protest involves some startling conclusions,
and ignores and evades the question at issue–that is, that the
principle of local self-government is just as fundamental in
our institutions as is that of Federal supremacy. You calmly
assume that the Executive has the legal right to order Federal
troops into any community of the United States in the first
instance, whenever there is the slightest disturbance, and that
he can do this without any regard to the question as to whether
the community is able to and ready to enforce the law itself.

After a rather dreary discussion of the importance of preserving
the rights of the States and a presentation of the dangers to
constitutional government that lurked in the course that had been
pursued by the general Government, this communication closed as follows:

Inasmuch as the Federal troops can do nothing but what the
State troops can do there, and believing that the State is
amply able to take care of the situation and to enforce the
law, and believing that the ordering out of the Federal troops
was unwarranted, I again ask their withdrawal.

I confess that my patience was somewhat strained when I quickly sent
the following despatch in reply to this communication:

EXECUTIVE MANSION.
WASHINGTON, D. C., July 6, 1894.

While I am still persuaded that I have neither transcended
my authority nor duty in the emergency that confronts us, it
seems to me that in this hour of danger and public distress,
discussion may well give way to active efforts on the part of
all in authority to restore obedience to law and to protect
life and property.

GROVER CLEVELAND.

Hon. John P. Altgeld,
_Governor of Illinois_.

This closed a discussion which in its net results demonstrated how far
one’s disposition and inclination will lead him astray in the field of
argument.

I shall conclude the treatment of my subject by a brief reference to
the legal proceedings which grew out of this disturbance, and finally
led to an adjudication by the highest court in our land, establishing
in an absolutely authoritative manner and for all time the power of the
national Government to protect itself in the exercise of its functions.

It will be recalled that in the course of our narrative we left Mr.
Debs, the president of the Railway Union, and his three associates
in custody of the law, on the seventeenth day of July, awaiting an
investigation of the charge of contempt of court made against them,
based upon their disobedience of the writs of injunction forbidding
them to do certain things in aid or encouragement of interference with
mail transportation or interstate commerce.

This investigation was so long delayed that the decision of the Circuit
Court before which the proceedings were pending was not rendered until
the fourteenth day of December, 1894. On that date the court delivered
an able and carefully considered decision finding Debs and his
associates guilty of contempt of court, basing its decision upon the
provisions of the law of Congress, passed in 1890, entitled: “An act to
protect trade and commerce against unlawful restraint and monopolies”;
sometimes called the Sherman Anti-Trust Law. Thereupon the parties
were sentenced on said conviction to confinement in the county jail for
terms varying from three to six months.

Afterward, and on the 14th day of January, 1895, the prisoners applied
to the Supreme Court of the United States for a writ of habeas corpus
to relieve them from imprisonment, on the ground that the facts found
against them by the Circuit Court did not constitute disobedience of
the writs of injunction and that their commitment in the manner and
for the reasons alleged was without justification and not within the
constitutional power and jurisdiction of that tribunal.

On this application, the case was elaborately argued before the Supreme
Court in March, 1895; and on the twenty-seventh day of May, 1895, the
court rendered its decision, upholding on the broadest grounds the
proceedings of the Circuit Court and confirming its adjudication and
the commitment to jail of the petitioners thereupon.

Justice Brewer, in delivering the unanimous opinion of the Supreme
Court, stated the case as follows:

The United States, finding that the interstate transportation
of persons and property, as well as the carriage of mails,
is forcibly obstructed, and that a combination and conspiracy
exists to subject the control of such transportation to the
will of the conspirators, applied to one of their courts
sitting as a court of equity, for an injunction to restrain
such obstructions and prevent carrying into effect such
conspiracy. Two questions of importance are presented: First,
are the relations of the general Government to interstate
commerce and the transportation of the mails such as to
authorize a direct interference to prevent a forcible
obstruction thereof? Second, if authority exists,–as authority
in governmental affairs implies both power and duty,–has a
court of equity jurisdiction to issue an injunction in aid of
the performance of such duty?

Both of these questions were answered by the court in the affirmative;
and in the opinion read by the learned justice, the inherent power of
the Government to execute the powers and functions belonging to it
by means of physical force through its official agents, and on every
foot of American soil, was amply vindicated by a process of reasoning
simple, logical, unhampered by fanciful distinctions, and absolutely
conclusive; and the Government’s peaceful resort to the court, the
injunction issued in its aid, and all the proceedings thereon,
including the imprisonment of Debs and his associates, were fully
approved.

Thus the Supreme Court of the United States has written the closing
words of this history, tragical in many of its details, and in every
line provoking sober reflection. As we gratefully turn its concluding
page, those who were most nearly related by executive responsibility to
the troublous days whose story is told may well especially congratulate
themselves on the part which fell to them in marking out the way and
clearing the path, now unchangeably established, which shall hereafter
guide our nation safely and surely in the exercise of the important
functions which represent the people’s trust.

THE BOND ISSUES

I

The sales of United States bonds in the years 1894, 1895, and 1896 for
the purpose of replenishing the stock of gold in the public Treasury
have been greatly misunderstood by many honest people, and often
deliberately misrepresented.

My conviction that a love of fairness still abides with the masses of
our people has encouraged me to give a history of these transactions
for the benefit of those who are uninformed or have been misled
concerning them. In undertaking this task I shall attempt to avoid
unprofitable and tiresome explanation; but I shall, nevertheless,
indulge in the recital of details to such an extent as may appear
necessary to an easy understanding of the matter in hand. I desire,
above all things, to treat the subject in such a way that none who
read my narrative will be confused by the use of obscure or technical
language.

The Government’s gold reserve, as it is usually known, originated under
the provision of an act of Congress passed January 14, 1875, entitled,
“An Act to provide for the resumption of specie payments.” This law
contemplated the redemption in gold and the retirement of the currency
obligations legally known as United States notes, but commonly called
greenbacks; and it provided that such notes in excess of $300,000,000
should be redeemed and retired prior to January 1, 1879, and that after
that date all the remainder of such notes should be likewise redeemed
and canceled. This law further provided that “to enable the Secretary
of the Treasury to prepare and provide for such redemption” he should
have the authority “to issue, sell and dispose of” bonds of the United
States which were therein particularly specified. Of course this
authority was given to the Secretary of the Treasury in order that, by
the sale of Government bonds, he could accumulate a sufficient gold
fund or reserve to meet the demands of the gold redemption provided
for, and accomplish the ultimate retirement of all the United States
notes in circulation.

In compliance with this act, the sum of about $92,000,000 in gold was
realized by the sale of bonds, and about $41,000,000, in addition,
was obtained from surplus revenue; and thereupon the contemplated
redemption was entered upon. But after the retirement and cancelation
of only about $30,000,000 of these notes, and on the thirty-first day
of May, 1878, this process was interrupted by the passage of an act
forbidding their further retirement or cancelation, and providing that
any such notes thereafter redeemed should not be canceled or destroyed,
but should be “reissued and paid out again and kept in circulation.”
At the time this act was passed the United States notes uncanceled
and still outstanding amounted to $346,681,016. It will be observed
that though the actual retirement of these notes was prohibited, their
redemption in gold was still continued, coupled with the condition
that, though thus redeemed, they should be still kept on foot and again
put in circulation as a continuing and never-ending obligation of the
Government, calling for payment in gold–not once alone, but as often
as their reissue permitted, and without the least regard to prior
so-called redemptions. It will be also observed that this prohibition
of cancelation intervened seven months prior to January 1, 1879, the
date when the general and unrestricted redemption and retirement of
all these outstanding notes was, under the terms of the act of 1875,
to commence. At the time when their further cancelation was thus
terminated there remained of the gold which had been provided as a
reserve for their redemption about $103,000,000. This is the fund which
has since then been called the “gold reserve.”

In point of fact, this reserve was thereafter made up of all the net
gold held by the Government; and its amount at any particular date was
ascertained by deducting from the entire stock of gold in the Treasury
the amounts covered by outstanding gold certificates, which instruments
resemble a bank’s certificate of deposit, and are issued by the
Secretary of the Treasury to those making with the Government specific
deposits of gold, to be returned to the holders of the certificates on
demand. Of course the gold thus held for certificate-holders is not
available for the redemption of United States notes.

In the year 1882 a law was passed by Congress which provided that
the Secretary of the Treasury should suspend the issue of these gold
certificates “whenever the amount of gold coin and gold bullion in the
Treasury, reserved for the redemption of United States notes, falls
below $100,000,000.” Whatever may have been the actual relationship
between gold certificates representing gold deposited for their
redemption, and the gold kept on hand for the redemption of United
States notes, the provision of law just quoted seems to have been
accepted as a statutory recognition of the fact that our gold reserve
for note redemption should have for its lowest limit this sum of
$100,000,000. It is a singular circumstance that until very lately,
when this reserve was increased and fixed at $150,000,000, no Act of
Congress actually provided, or in any way expressly stated, what the
limits of this gold reserve for redemption purposes should be; and it
is no less singular that this provision in the law of 1882 fixed its
lowest safe limit as perfectly and authoritatively in the understanding
of our people as it could have been done by a distinct legislative
requirement. At the time this reserve was created, as well as when
the actual cancelation of United States notes after redemption was
prohibited, it evidently was thought by those directing our nation’s
financial affairs that the sum of $100,000,000 in net gold actually in
hand, especially with such additions as might naturally be expected to
reach the fund by way of surplus revenue receipts, or otherwise, would
constitute a sufficient gold reserve to redeem such of these notes
still left outstanding as might be presented, and that the assurance
of their gold redemption when presented would keep them largely in
circulation. This scheme seemed for a time to be abundantly vindicated
by the people’s contentment with the sufficiency of the redemption
reserve, and by their willingness to keep in circulating use these
United States notes as currency more convenient than gold itself.

Another most important condition of mind among the people, however,
grew out of, or at least accompanied, their acceptance of the
redemptive sufficiency of the gold reserve as constituted. The popular
belief became deep-seated and apparently immovable that the reduction
of this gold reserve to an amount less than $100,000,000 would, in some
way, cause a disastrous situation, and perhaps justify an apprehension
concerning our nation’s financial soundness. Thus a gold reserve
containing at all times at least $100,000,000 came to be regarded by
the people with a sort of sentimental solicitude, which, whatever else
may be said of it, was certainly something to be reckoned with in
making our national financial calculations.

That the plans thus set on foot for the so-called redemption of the
United States notes outstanding promised to be adequate and effective
is seen in the fact that the gold reserve, starting at the end of
June, 1878, with about $103,500,000, never afterward fell as low as
$100,000,000 until April, 1893, and that sometimes in its fluctuations
during this interval of twenty-five years it amounted to upward of
$200,000,000. Under conditions then existing popular confidence was
well established, the reserve satisfactorily endured the strain of
all redemption demands, and United States notes were kept well in
circulation as money.

In an evil hour, however, a legislative concession was made to a
mischievous and persistent demand for the free and unlimited coinage
of silver. This concession was first exhibited in an act of Congress
passed in 1878, directing the expenditure of not less than $2,000,000
nor more than $4,000,000 each month by the Secretary of the Treasury in
the purchase of silver bullion, and the coinage of such bullion into
silver dollars. Though this act is not in itself so intimately related
to my subject as to require detailed explanation, it was the forerunner
of another law of Congress which had much to do with creating the
financial conditions that necessitated the issuance of Government
bonds for the reinforcement of the gold reserve.

This law was passed in 1890, and superseded the provision of the law
of 1878 directing the purchase and coinage of silver. In lieu of
these provisions the Secretary of the Treasury was thereby directed
to purchase silver bullion from time to time in each month to the
aggregate amount of 4,500,000 ounces, or as much as might be offered,
at the market price, not to exceed, however, a limit therein fixed.
It was further provided that there should be issued, in payment of
such purchases of silver bullion, Treasury notes of the United States
in denominations not less than one dollar nor more than $1000; that
such notes should be redeemable in coin, and should “be a legal tender
in payment of all debts, public and private, except where otherwise
expressly stipulated in the contract, and should be receivable for
customs, taxes and all public dues”; and that when they were redeemed
or paid into the Treasury they might be reissued. The Secretary of
the Treasury was directed to coin into silver dollars in each month
until the first day of July, 1891, 2,000,000 ounces of the silver so
purchased, and thereafter so much as might be necessary to provide for
the redemption of the notes issued in payment for the silver from time
to time purchased under the act.

I have recited these provisions by way of leading up to the proposition
that, under the law of 1890, the burden upon the gold reserve was
tremendously enlarged. It will be readily seen that it forced larger
monthly purchases of silver than were required under the prior act,
and that, instead of providing for silver dollars, which as coins, or
certificates of deposit representing such coins, should circulate as
silver currency, unredeemable in gold as was done under the act of
1878, it directed that in payment of such purchases a new obligation of
the Government, redeemable in coin, should be issued and added to our
circulating medium.

It is, however, only when we examine the specific provision for the
redemption of these notes that we discover in its full extent the
harmful relationship of this new device to the integrity of the gold
reserve. At its outset the redemption clause of the act courageously
and manfully gave to the Secretary of the Treasury the authority to
redeem such notes in gold or silver _at his discretion_; but in its
ending it fell down a pitiful victim of the silver craze. The entire
clause is in these words: “That upon demand of the holder of any of
the Treasury notes herein provided for, the Secretary of the Treasury
shall, under such regulations as he may provide, redeem such notes in
gold or silver coin at his discretion, _it being the established policy
of the United States to maintain the two metals at a parity with each
other upon the present legal ratio, or such ratio as may be provided by
law_.”

According to the legal ratio then existing, which has never been
changed, the average intrinsic gold value of a silver dollar as
compared with a gold dollar was, during the year 1891, about
seventy-six cents, during 1892 a trifle more than sixty-seven cents,
and during 1893 about sixty cents.

It is hardly necessary to say that the assertion in the act of “the
established policy of the United States to maintain the two metals at
a parity” had the effect of transferring the discretion of determining
whether these Treasury notes should be redeemed in gold or silver, from
the Secretary of the Treasury to the holder of the notes. Manifestly,
in the face of this assertion of the Government’s intention, a demand
for gold redemption on the part of the holders of such notes could not
be refused, and the acceptance of silver dollars insisted upon, without
either subjecting to doubt the good faith and honest intention of the
Government’s professions, or creating a suspicion of our country’s
solvency. The parity between the two metals could not be maintained,
but, on the contrary, would be distinctly denied, if the Secretary of
the Treasury persisted in redeeming these notes, against the will of
the holders, in dollars of silver instead of gold.

Therefore it came to pass that the Treasury notes issued for the
purchase of silver under the law of 1890 took their place by the side
of the United States notes, commonly called greenbacks, as demands
against our very moderate and shifting gold reserve.

It should have been plainly apparent to all who had eyes to see that
the monetary scheme, thus additionally burdened, was adequate and safe
only in smooth financial weather, and was miserably calculated to
resist any disturbances in public confidence, or the rough waves of
business emergencies. The proof of this was quickly forthcoming.

The new Treasury notes made their first appearance as part of our money
circulation in August, 1890; and at the close of that month the gold
reserve amounted to $185,837,581. During the next month it fell off
about $38,000,000, reducing the amount on the last day of September
to nearly $148,000,000; and with a few slight spasmodic rallies it
continued to decrease until the sale of bonds for its replenishment.

In the latter part of 1892 and the first months of 1893, these Treasury
notes having, in the meantime, very greatly multiplied, the withdrawals
of gold from the Treasury through the redemption of these as well
as the United States notes strikingly increased; and the fact that
by far the larger part of the gold so withdrawn was shipped abroad
plainly showed that foreign investors in American securities had grave
apprehensions as to our ability to continue to redeem all these notes
in gold and thus maintain the integrity and soundness of our financial
condition.

I succeeded Mr. Harrison in the Presidency on the fourth day of
March, 1893; and on the seventh of that month Mr. Carlisle became
Secretary of the Treasury. The gold reserve on that day amounted to
$100,982,410–only $982,410 in excess of the sum that had come to
be generally regarded as indicating the danger line. The retiring
Secretary of the Treasury, appreciating the importance of preventing
the fall of the reserve below this limit, had just before his
retirement directed the preparation of plates for the engraving of
bonds so that he might by their sale obtain gold to reinforce the
fund. I have heard him say within the last few years that he expected
before the close of his term to resort to bond sales for the purpose
of such reinforcement, unless prevented at the last moment by the
President’s disapproval. Of course it is but natural that any one
directing the affairs of the Treasury Department should be anxious to
avoid such an expedient; and Secretary Foster avoided it, and barely
saved the reserve from falling below the $100,000,000 mark during his
term, by effecting arrangements, in January and February, 1893, with
certain bankers in New York, by which he obtained from them in exchange
for United States notes, or on other considerations, something over
$8,000,000 in gold, which enabled him to escape the sale of bonds in
aid of the reserve.

With the gold reserve lower than it had ever been since its creation
in 1878, and showing an excess of less than $1,000,000 above the
supposed limit of disaster, and with the demand for gold redemption
of Government currency obligations giving no sign of abatement,
the prospect that greeted the new administration was certainly not
reassuring. In our effort to meet the emergency without an issue of
bonds Secretary Carlisle immediately applied to banks in different
localities for an exchange with the Government of a portion of their
holdings of gold coin for other forms of currency. This effort was so
far successful that on the 25th of March the gold reserve amounted
to over $107,000,000, notwithstanding the fact that considerable
withdrawals had been made in the interval. The slight betterment
thus secured proved, however, to be only temporary; for under the
stress of continued and augmented withdrawals, the gold reserve, on
the twenty-second day of April, 1893, for the first time since its
establishment, was reduced below the $100,000,000 limit–amounting on
that day to about $97,000,000.

Though this fall below the minimum theretofore always maintained was
not followed by any sudden and distinctly new disaster, it had the
effect of accelerating withdrawals of gold. It became apparent that
there had intervened a growing apprehension among the masses of our
own people concerning the Government’s competency to continue gold
redemption, with the result that a greatly increased proportion of the
amount withdrawn from the gold reserve, instead of going abroad to
satisfy the claims of foreigners or as a basis of commercial exchange,
was hoarded by our citizens at home as a precaution against possible
financial distress. In the meantime, nearly the entire gold receipts
in payment of customs and other revenue charges had ceased. To meet
this situation strenuous efforts were made by the Secretary of the
Treasury to improve the condition by resorting again to the plan of
exchanging for gold other forms of currency, with some success, while
in the month of August, 1893, gold revenue receipts were temporarily
considerably stimulated. Thus a fleeting gleam of hope was given to the
dark surroundings.

In these troublous times those charged with the administration of the
Government’s financial affairs could not fail to recognize in the law
of 1890, directing the monthly purchase of silver and the issuance in
payment therefor of Treasury notes in effect redeemable in gold, a
prolific cause of our financial trouble. Accordingly, a special session
of Congress was called to meet on the seventh day of August, 1893, to
repeal this law, and thus terminate the creation of further demands
upon our already overburdened and feeble gold reserve. The repealing
act was quite promptly passed in the House of Representatives on the
twenty-eighth day of August; but, on account of vexatious opposition
in the Senate, the repeal was not finally effected until the first day
of November, 1893, and then only after there had been added to the act
an inopportune repetition of the statement concerning the Government’s
intention to maintain the parity of both gold and silver coins.

II

The effect of this repeal in its immediate results failed to quiet the
fear of impending evil now thoroughly aroused; nor were all the efforts
thus far made to augment the gold reserve effective as against the
constant process of its depletion.

On the seventeenth day of January, 1894, the Government was confronted
by a disquieting emergency. The gold reserve had fallen to less than
$70,000,000, notwithstanding the most diligent efforts to maintain it
in sounder condition. Against this slender fund gold demands amounting
to not less than $450,000,000 in United States notes and Treasury notes
were in actual circulation, and others amounting to about $50,000,000,
in addition, were temporarily held in the Treasury subject to
reissue–the entire volume, by peremptory requirement of law, remaining
uncanceled even after repeated redemption; nor was there any promise
of a cessation of the abnormal and exhausting drain of gold then fully
under way. Another factor in the situation, most perplexing and
dangerous, was the distrust, which was growing enormously, regarding
the wisdom and stability of our scheme of finance. As a result of these
conditions there loomed in sight the menace of the destruction of our
gold reserve, the repudiation of our gold obligations, the humiliating
fall of our nation’s finances to a silver basis, and the degradation of
our Government’s high standing in the respect of the civilized world.

There was absolutely but one way to avert national calamity and our
country’s disgrace; and this way was adopted when, on the seventeenth
day of January, 1894, the Secretary of the Treasury issued a notice
that bids in gold would be received until the first day of February
following for $50,000,000 in bonds of the United States, redeemable in
coin at the pleasure of the Government after ten years from the date
of their issue, and bearing interest at the rate of five per cent.
per annum. It was further stated in the notice that no bid would be
considered that did not offer a premium on said bonds of a fraction
more than seventeen per cent., which would secure to the purchaser an
investment yielding three per cent. per annum.

It should here be mentioned that the only Government bonds which could
be sold in the manner and for the purpose contemplated were such as
were authorized and described in a law passed in 1870, and which were
designated in the law of 1875 providing for the redemption of United
States notes as the kind of bonds which the Secretary of the Treasury
was permitted to sell to enable him “to prepare and provide for”
such redemption. The issues of bonds thus authorized were of three
descriptions: one payable at the pleasure of the Government after
ten years from their date, and bearing interest at the rate of five
per cent.; one so made payable after fifteen years from their date,
bearing four and a half per cent. interest; and one in like manner
made payable after thirty years from their date, bearing interest at
the rate of four per cent. The five per cent. bonds were specified in
the Secretary’s offer of sale because on account of their high rate of
interest they would command a greater premium, and therefore a larger
return of gold, and for the further reason that the option of the
Government regarding their payment could be earlier exercised.

The withdrawals of gold did not cease with the offer to sell bonds
for the replenishment of the reserve, and on the day before the date
limited for the opening of bids the fund had decreased to less than
$66,000,000. In the meantime, the perplexity of the situation, already
intense, was made more so by the fact that the bids for bonds under
the offer of the Secretary came in so slowly that a few days before
the 1st of February, when the bids were to be opened, there were plain
indications that the contemplated sale would fail unless prompt and
energetic measures were taken to avoid such a perilous result.

Thereupon the Secretary of the Treasury invited to a conference, in
the city of New York, a number of bankers and presidents of moneyed
institutions, which resulted in so arousing their patriotism, as
well as their solicitude for the protection of the interests they
represented, that they effectively exerted themselves, barely in time
to prevent a disastrous failure of the sale. The proceeds of this
sale, received from numerous bidders large and small, aggregated
$58,660,917.63 in gold, which so increased the reserve that on the
sixth day of March, 1894, it amounted to $107,440,802.

It was hoped that this measure of restoration and this exhibition of
the nation’s ability to protect its financial integrity would allay
apprehension and restore confidence to such an extent as to render
further bond sales unnecessary. It was soon discovered, however, that
the complications of our ill condition were so deep-seated and stubborn
that the treatment resorted to was only a palliative instead of a cure.

On the last day of May, 1894, less than three months after its
reinforcement, as mentioned, the gold reserve had been again so
depleted by withdrawals that it amounted to only $78,693,267. An almost
uninterrupted downward tendency followed, notwithstanding constant
efforts on the part of the Government to check the fall, until, on the
fourteenth day of November, 1894, the fund had fallen to $61,878,374.
In the meantime, the inclination of our timid citizens to take gold
from the reserve for hoarding “had grown by what it fed on,” while
large shipments abroad to meet foreign indebtedness or for profit still
continued and increased in amount.

In these circumstances the inexorable alternative presented itself of
again selling Government bonds for the replenishment of its redemption
gold, or assuming the tremendous risk of neglecting the safety and
permanence of every interest dependent upon the soundness of our
national finances. An obedient regard for official duty made the right
path exceedingly plain.

On the day last mentioned a public proposal was issued inviting bids
in gold for the purchase of additional five per cent. bonds to the
amount of $50,000,000. Numerous bids were received under this proposal,
one of which, for “all or none” of the bonds, tendered on behalf of
thirty-three banking institutions and financiers in the city of New
York, being considerably more advantageous to the Government than all
other bids, was accepted, and the entire amount was awarded to these
parties. This resulted in adding to the reserve the sum of $58,538,500.

The president at that time of the United States Trust Company, one
of the strongest and largest financial institutions in the country,
rendered most useful and patriotic service in making both this and the
previous offer of bonds successful; and his company was a prominent
purchaser on both occasions. He afterward testified under oath that
the accepted bid for “all or none,” in which his company was a large
participant, proved unprofitable to the bidders.

The payment of gold into the Treasury on account of this sale of
bonds was not entirely completed until after the 1st of December,
1894. Then followed a time of bitter disappointment and miserable
depression, greater than any that had before darkened the struggles of
the Executive branch of the Government to save our nation’s financial
integrity.

The addition made to the gold reserve by this completed transaction
seemed to be of no substantial benefit, if, on the contrary, it did
not actually stimulate the disquieting factors of the situation. In
December, 1894, during which month $58,538,500 in gold, realized from
this second sale of bonds, was fully paid in and added to the reserve,
the withdrawals from the fund amounted to nearly $32,000,000; and this
was followed in the next month, or during January, 1895, by a further
depletion in the sum of more than $45,000,000.

In view of the crisis which these suddenly increased withdrawals seemed
to portend, the aid of Congress was earnestly invoked in a special
presidential message to that body, dated on the 28th of January, 1895,
in which the gravity and embarrassment of the situation were set forth
in the following terms:

The real trouble which confronts us consists in a lack of
confidence, widespread and constantly increasing, in the
continuing ability or disposition of the Government to pay
its obligations in gold. This lack of confidence grows to
some extent out of the palpable and apparent embarrassment
attending the efforts of the Government under existing laws to
procure gold, and to a greater extent out of the impossibility
of either keeping it in the Treasury or canceling obligations
by its expenditure after it is obtained….

The most dangerous and irritating feature of the situation,
however, remains to be mentioned. It is found in the means
by which the Treasury is despoiled of the gold thus obtained
(by the sale of bonds) without canceling a single Government
obligation, and solely for the benefit of those who find profit
in shipping it abroad, or whose fears induce them to hoard it
at home. We have outstanding about $500,000,000 of currency
notes of the Government for which gold may be demanded, and,
curiously enough, the law requires that when presented, and, in
fact, redeemed and paid in gold, they shall be reissued. Thus
the same notes may do duty many times in drawing gold from the
Treasury; nor can the process be averted so long as private
parties, for profit or otherwise, see an advantage in repeating
the operation. More than $300,000,000 of these notes have been
redeemed in gold, and, notwithstanding such redemption, they
are still outstanding.

After giving a history of the bond issues already made to replenish the
reserve, and of their results, it was further stated:

The financial events of the past year suggest facts and
conditions which should certainly arrest attention. More than
$172,000,000 in gold have been drawn out of the Treasury
during the year for the purpose of shipment abroad or hoarding
at home.

While nearly $103,000,000 was drawn out during the first ten
months of the year, a sum aggregating more than two-thirds of
that amount, being about $69,000,000, was drawn out during the
following two months, thus indicating a marked acceleration of
the depleting process with the lapse of time.

Following a reference to existing differences of opinion in regard to
the extent to which silver should be coined or used in our currency,
and the irrelevancy of such differences to the matter in hand, the
message continued:

While I am not unfriendly to silver, and while I desire to see
it recognized to such an extent as is consistent with financial
safety and the preservation of national honor and credit, I am
not willing to see gold entirely banished from our currency
and finances. To avert such a consequence I believe thorough
and radical remedial legislation should be promptly passed.
I therefore beg the Congress to give the subject immediate
attention.

After recommending the passage of a law authorizing the issue of
long-term bonds, bearing a low rate of interest, to be used for the
maintenance of an adequate gold reserve and in exchange for outstanding
United States notes and Treasury notes for the purpose of their
cancelation, and after giving details of the proposed scheme, the
message concluded as follows:

In conclusion, I desire to frankly confess my reluctance to
issue more bonds in present circumstances and with no better
results than have lately followed that course. I cannot,
however, refrain from adding to an assurance of my anxiety to
co-operate with the present Congress in any reasonable measure
of relief, an expression of my determination to leave nothing
undone which furnishes a hope for improving the situation, or
checking a suspicion of our disinclination or disability to
meet, with the strictest honor, every national obligation.

This appeal to Congress for legislative aid was absolutely fruitless.

On the eighth day of February, 1895, those who, under the mandate of
Executive duty, were striving, thus unaided, to avert the perils of the
situation, could count in the gold reserve only the frightfully low sum
of $41,340,181; and it must be remembered that this was only two months
after the proceeds of the second sale of bonds had been added to the
fund. In point of fact, the withdrawals of gold during the short period
mentioned had exceeded by more than $18,000,000 the amount of such
proceeds; and several million dollars more had been demanded, some of
which, though actually taken out, was unexpectedly, and on account of
the transaction now to be detailed, returned to the Treasury.

This sudden fall in the reserve, and the apparent certainty of the
continuance of its rapid depletion, seemed to justify the fear that
before another bond sale by means of public notice and popular
subscription could be perfected the gold reserve might be entirely
exhausted; nor could we keep out of mind the apprehension that in
consequence of repeated dispositions of bonds, with worse instead
of better financial conditions impending, further sales by popular
subscription might fail of success, except upon terms that would give
the appearance of impaired national credit.

Notwithstanding all this, no other way seemed to be open to us than
another public offer of bonds; and it was determined to move in that
direction immediately.

In anticipation of this action it was important to obtain certain
information and suggestions touching the feeling and disposition of
those actively prominent in financial and business circles.

I think it may here be frankly confessed that it never occurred to
any of us to consult, in this emergency, farmers, doctors, lawyers,
shoe-makers, or even statesmen. We could not escape the belief that
the prospect of obtaining what we needed might be somewhat improved by
making application to those whose business and surroundings qualified
them to intelligently respond.

Therefore, on the evening of the seventh day of February, 1895, an
interview was held at the White House with Mr. J. P. Morgan of New
York; and I propose to give the details of that interview as gathered
from a recollection which I do not believe can be at fault. Secretary
Carlisle was present nearly or quite all the time, Attorney-General
Olney was there a portion of the time, and Mr. Morgan and a young man
from his office and myself all the time. At the outset Mr. Morgan was
inclined to complain of the treatment he had received from Treasury
officials in the repudiation of an arrangement which he thought he had
been encouraged to perfect in connection with the disposal of another
issue of bonds. I said to Mr. Morgan, whatever there might be in all
this, another offer of bonds for popular subscription open to all
bidders had been determined upon, and that there were two questions I
wanted to ask him which he ought to be able to answer: one was whether
the bonds to be so offered would probably be taken at a good price
on short notice; and the other was whether, in case there should be
imminent danger of the disappearance of what remained of the gold
reserve, during the time that must elapse between published notice and
the opening of bids, a sufficient amount of gold could be temporarily
obtained from financial institutions in the city of New York to bridge
over the difficulty and save the reserve until the Government could
realize upon the sale of its bonds. Mr. Morgan replied that he had no
doubt bonds could be again sold on popular subscription at some price,
but he could not say what the price would be; and to the second inquiry
his answer was that, in his opinion, such an advance of gold as might
be required could be accomplished if the gold could be kept in this
country, but that there might be reluctance to making such an advance
if it was to be immediately withdrawn for shipment abroad, leaving
our financial condition substantially unimproved. After a little
further discussion of the situation he suddenly asked me why we did
not buy $100,000,000 in gold at a fixed price and pay for it in bonds,
under Section 3700 of the Revised Statutes. This was a proposition
entirely new to me. I turned to the Statutes and read the section he
had mentioned. Secretary Carlisle confirmed me in the opinion that
this law abundantly authorized such a transaction, and agreed that it
might be expedient if favorable terms could be made. The section of the
Statutes referred to reads as follows:

_Section 3700._ The Secretary of the Treasury may purchase coin
with any of the bonds or notes of the United States authorized
by law, at such rates and upon such terms as he may deem most
advantageous to the public interest.

Mr. Morgan strongly urged that, if we proceeded under this law, the
amount of gold purchased should not be less than $100,000,000; but he
was at once informed that in no event would more bonds be then issued
than would be sufficient to provide for adding to the reserve, about
$60,000,000, the amount necessary to raise the fund to $100,000,000.

Not many months afterward I became convinced that on this point Mr.
Morgan made a wise suggestion; and I have always since regretted that
it was not adopted.

III

It can hardly be necessary to state that any plan which would protect
from immediate withdrawal the gold we might add to our reserve could
not fail to be of extreme value. Such of these withdrawals as were
made for hoarding gold could be prevented only by a restoration of
confidence among those of our people who had grown suspicious of
the Government’s financial ability; but the considerable drain from
the reserve for the purchase of the very bonds to be sold for its
reinforcement, and the much larger drain made by those who profited by
the shipment of gold abroad, could be, measurably at least, directly
arrested. Thus to the extent that foreign gold might be brought here
and used for the purchase of bonds, the use for that purpose of such
as was held by our own people or as was already in the reserve subject
to their withdrawal would not only be decreased, but the current of
the passage of gold would be changed and would flow toward us instead
of away from us, making the prospect of profit in gold exportation
less alluring. An influx of gold from abroad would also have a tendency
to decrease the sentimental estimate of its desirability which its
unrelieved scarcity was apt to create in timid minds. It was especially
plain that so far as withdrawals from our reserve for speculative
shipment abroad were concerned, they could be discouraged by the
efforts of those whose financial connections in other countries enabled
them to sell gold exchange on foreign money centers at a price which
would make the actual transportation of the coin itself unprofitable.

The position of Mr. Morgan and the other parties in interest whom he
represented was such in the business world that they were abundantly
able, not only to furnish the gold we needed, but to protect us in
the manner indicated against its immediate loss. Their willingness to
undertake both these services was developed during the discussion of
the plan proposed; and after careful consideration of every detail
until a late hour of the night, an agreement was made by which J. P.
Morgan & Co. of New York, for themselves and for J. S. Morgan & Co.
of London; and August Belmont & Co. of New York, for themselves and
for N. M. Rothschild & Son of London, were to sell and deliver to the
Government 3,500,000 ounces of standard gold coin of the United States,
to be paid for in bonds bearing annual interest at the rate of four per
cent. per annum, and payable at the pleasure of the Government after
thirty years from their date, such bonds to be issued and delivered
from time to time as the gold coin to be furnished was deposited by
said parties in the subtreasuries or other legal depositories of the
United States. At least one half of the coin so delivered was to be
obtained in Europe, and shipped from there in amounts not less than
300,000 ounces per month, at the expense and risk of the parties
furnishing the same; and so far as it was in their power they were
to “exert all financial influence and make all legitimate efforts to
protect the Treasury of the United States against the withdrawals of
gold pending the complete performance of the contract.”

Four per cent. bonds were selected for use in this transaction instead
of ten-year bonds bearing five per cent. interest, because their
maturity was extended to thirty years, thus offering a more permanent
and inviting investment, and for the further reason that $100,000,000
of shorter five per cent. bonds had already been issued, and it was,
therefore, deemed desirable to postpone these further bond obligations
of the Government to a later date. The price agreed upon for the gold
coin to be delivered was such that the bonds given in payment therefor
would yield to the investor an annual income of three and three fourths
per cent.

It has already been stated that the only bonds which could be utilized
in our efforts to maintain our gold reserve were those described in a
law passed as early as 1870, and made available for our uses by an act
passed in 1875. The terms of these bonds were ill suited to later ideas
of investment, and they were made payable in coin and not specifically
in gold. Nothing at any time induced the exchange of gold for these
coin bonds, except a reliance upon such a measure of good faith on the
part of the Government, and honesty on the part of the people, as would
assure their payment in gold coin and not in depreciated silver.

It was exceedingly fortunate that, at the time this agreement was under
consideration, certain political movements calculated to undermine this
reliance upon the Government’s continued financial integrity were not
in sight; but it was, nevertheless, very apparent that the difficulties
of the situation would be greatly lessened if, in safeguarding our
reserve, bonds could be used payable by their terms in gold, and
bearing a rate of interest not exceeding three per cent. Accordingly,
at the instance of Secretary Carlisle, a bill had been introduced in
the House of Representatives, some time before the Morgan-Belmont
agreement was entered upon, which authorized the issue of bonds of that
description. A few hours before the agreement was consummated this
sane and sensible legislation was brought to a vote in the House and
rejected.

When, in our interview with Mr. Morgan, the price for the gold to be
furnished was considered, he gave reasons which we could not well
answer in support of the terms finally agreed upon; but he said that
the parties offering to furnish the gold would be glad to accept at par
three per cent. bonds, payable by their terms in gold instead of in
coin, in case their issue could be authorized. He expressed not only a
willingness but a strong desire that a substitution might be made of
such bonds in lieu of those already selected, and readily agreed to
allow us time to procure the necessary legislation for that purpose.
He explained, however, that only a short time could be stipulated
for such a substitution, because in order to carry out successfully
the agreement contemplated, the bonds must be offered in advance to
investors both here and abroad, and that after numerous subscriptions
had been received from outside parties the form and condition of the
securities could not be changed; and he added that, but for this, there
would be no objection to the concession of all the time desired. It
was finally agreed that ten days should be allowed us to secure from
Congress the legislation necessary to permit the desired substitution
of bonds. A simple calculation demonstrated that by such a substitution
the Government would save on account of interest more than $16,000,000
before the maturity of the bonds. It was further stipulated on the part
of the Government that if the Secretary of the Treasury should desire
to sell any further bonds on or before October 1, 1895, they should
first be offered to the parties then represented by Mr. Morgan. This
stipulation did not become operative.

When our conference terminated it was understood that Secretary
Carlisle and Attorney-General Olney should act for the Government at
a meeting between the parties early the following day, at which the
agreement we had made was to be reduced to writing; and thereupon I
prepared a message which was submitted to the Congress at the opening
of its session on the following day, in which the details of our
agreement were set forth and the amount which would be saved to the
Government by the substitution of three per cent. gold bonds was
plainly stated; but having no memorandum of the agreement before me,
in my haste I carelessly omitted to mention the efforts agreed on by
Mr. Morgan and his associates to prevent gold shipments. The next
morning a contract embodying our agreement was drawn and signed, and a
copy at once given to the chairman of the Ways and Means Committee of
the House, so that the delay of a demand for its inspection might be
avoided. A bill was also immediately introduced again giving authority
to issue three per cent. bonds, payable by their terms in gold, to be
substituted in place of the four per cent. bonds as provided in the
contract–to the end that $16,000,000 might be saved to the Government,
and the public welfare in every way subserved.

The object of this message was twofold. It was deemed important,
considering the critical condition of our gold reserve, that the public
should be speedily informed of the steps taken for its protection; and
in addition, though previous efforts to obtain helpful legislation had
resulted in discouragement, it was hoped that when the saving by the
Government of $16,000,000 was seen to depend on the action of Congress
there might be a response that would accord with patriotic public duty.

Quite in keeping with the congressional habit prevailing at that time,
the needed legislation was refused, and this money was not saved.

The contract was thereupon carried out as originally made. In its
execution four per cent. bonds were delivered amounting to $62,315,400,
and the sum of $65,116,244.62 in gold received as their price. The
last deposit in completion of the contract was made in June, 1895, but
additional gold was obtained from the contracting parties in exchange
for United States notes and Treasury notes until in September, 1895,
when the entire amount of gold received from them under the contract
and through such exchanges had amounted to more than $81,000,000. The
terms of the agreement were so well carried out, not only in the matter
of furnishing gold, but in procuring it from abroad and protecting the
reserve from withdrawals, that during its continuance the operation
of the “endless chain” which had theretofore drained our gold was
interrupted. No gold was, during that period, taken from the Treasury
to be used in the purchase of bonds, as had previously been the case,
nor was any withdrawn for shipment abroad.

It became manifest, however, soon after this contract was fully
performed, that our financial ailments had reached a stage so nearly
chronic that their cure by any treatment within Executive reach might
well be considered a matter of anxious doubt. In the latter months of
the year 1895 a scarcity of foreign exchange and its high rate, the
termination of the safeguards of the Morgan-Belmont contract, and, as
a result, the renewal of opportunity profitably to withdraw gold for
export with a newly stimulated popular apprehension, and perhaps other
disturbing incidents, brought about a recurrence of serious depletions
of gold from the reserve.

In the annual Executive message sent to Congress on the second day
of December, 1895, the situation of our finances and currency was
set forth in detail, and another earnest plea was made for remedial
legislative action. After mentioning the immediately satisfactory
results of the contract for the purchase of gold, the message continued:

Though the contract mentioned stayed for a time the tide of
gold withdrawals, its good results could not be permanent.
Recent withdrawals have reduced the reserve from $107,571,230
on the eighth day of July, 1895, to $79,333,966. How long it
will remain large enough to render its increase unnecessary is
only a matter of conjecture, though quite large withdrawals for
shipment in the immediate future are predicted in well-informed
quarters. About $16,000,000 has been withdrawn during the month
of November.

The prediction of further withdrawals mentioned in this message was so
fully verified that eighteen days after its transmission, and on the
twentieth day of December, 1895, another Executive communication was
sent to Congress, in contemplation of its holiday recess, in which,
after referring to the details contained in the former message, it was
stated:

The contingency then feared has reached us, and the withdrawals
of gold since the communication referred to, and others
that appear inevitable, threaten such a depletion in our
Government’s gold reserve as brings us face to face with the
necessity of further action for its protection. This condition
is intensified by the prevalence in certain quarters of sudden
and unusual apprehension and timidity in business circles.

The real and sensible cure for our recurring troubles can only
be effected by a complete change in our financial scheme.
Pending that, the Executive branch of the Government will not
relax its efforts nor abandon its determination to use every
means within its reach to maintain before the world American
credit, nor will there be any hesitation in exhibiting its
confidence in the resources of our country and the constant
patriotism of our people.

In view, however, of the peculiar situation now confronting us,
I have ventured to herein express the earnest hope that the
Congress, in default of the inauguration of a better system
of finance, will not take a recess from its labors before it
has, by legislative enactment or declaration, done something,
not only to remind those apprehensive among our own people
that the resources of this Government and a scrupulous regard
for honest dealing afford a sure guarantee of unquestioned
safety and soundness, but to reassure the world that with these
factors, and the patriotism of our citizens, the ability and
determination of our nation to meet in any circumstances every
obligation it incurs do not admit of question.

Perhaps it should not have been expected that members of Congress would
permit troublesome thoughts of the Government’s financial difficulties
to disturb the pleasant anticipations of their holiday recess; at
any rate, these difficulties and the appeal of the President for at
least some manifestation of a disposition to aid in their remedy were
completely ignored.

On the sixth day of January, 1896, the gold reserve having fallen
to $61,251,710, its immediate repair became imperative. Though our
resort to the expedient of purchasing gold with bonds under contract
had been productive of very satisfactory results, it by no means
indicated our abandonment of the policy of inviting offerings of gold
by public advertisement. It was rather an exceptional departure from
that policy, made necessary by the dangerously low state of the reserve
on account of extensive and sudden depletions, and the peril attending
any delay in replenishing it. We had not lost faith in the loyalty
and patriotism of the people, nor did we doubt their willingness to
respond to an appeal from their Government in any emergency. We also
confidently believed that if the bonds issued for the purpose of
increasing our stock of gold were widely distributed among our people,
self-interest as well as patriotism would stimulate the solicitude of
the masses of our citizens for the welfare of the nation. No reason
for discouragement had been found in public offerings for bonds, so
far as obtaining a needed supply of gold and a fair price for our
bonds were concerned. The failure of their wide distribution among
the people when so disposed of seemed to be largely owing to the fact
that the bonds themselves were so antiquated in form, and bore so high
a rate of interest, that it was difficult for an ordinary person to
make the rather confusing computation of premium and other factors
necessary to a safe and intelligent bid. In a transaction of this
sort, where the smallest fraction of a cent may determine the success
of an offer, those accustomed to the niceties of financial calculations
are apt to hold the field to the exclusion of many who, unaided, dare
not trust themselves in the haze of such intricacies. If Congress had
provided for the issuance of bonds bearing a low rate of interest,
which could have been offered to the public at par, I am convinced
that the plain people of the land would more generally have become
purchasers. Another difficulty that had to some extent prevented a more
common participation by the people in prior public sales arose, it was
thought, from their lack of notice of the pendency of such sales, and
want of information as to the advantages of the investment offered, and
the procedure necessary to present their bids in proper form.

In view of the fact that the gold then in the reserve amounted to
$20,000,000 more than it contained eleven months earlier, when the
Morgan-Belmont contract was made, and because, for that reason, more
time could be allowed for its replenishment, there was no hesitation
in deciding upon a return to our original plan of offering bonds in
exchange for gold by public subscription.

Having determined upon a return to this method, it was deemed wise,
upon consideration of all the circumstances, to make some modification
of prior action in such cases. Instead of short-term five per cent.
bonds, the longer-term bonds bearing four per cent. interest were
substituted, as, on the whole, the best we could offer for popular
subscription. Since two offerings of $50,000,000 each had proved to
be of only very temporary benefit, it was determined to double the
amount and offer $100,000,000 for subscription. Nearly a month was to
be given instead of a shorter time, as theretofore, between the date
of notice of the offer and the opening of the bids; and extraordinary
efforts were to be made to give the most thorough publicity to the
offerings–to the end that we might stimulate in every possible way the
desire of the masses of our people to invest in the bonds. Especial
information and aid were to be furnished for the guidance of those
inclined to subscribe; and successful bidders were to be allowed to pay
for the bonds awarded to them in instalments. The lowest denomination
of the bonds was to be fifty dollars, and the larger ones were to be in
multiples of that sum. In point of fact, it was resolved that nothing
should be left undone which would in any way promote the success of
this additional and increased offer of bond subscription to the public.

Accordingly, on the sixth day of January, 1896, a circular bearing
that date was issued, giving notice that proposals would be received
until the fifth day of February following for gold coin purchases of
$100,000,000 of the four per cent. bonds of the United States, upon
the terms above mentioned. These circulars were extensively published
in the newspapers throughout the country. Copies, together with a
letter of instruction to bidders, containing, among other things, a
computation showing the income the bonds would yield to the investor
upon their purchase at prices therein specified, and accompanied by
blanks for subscription, were sent to the postmasters in every State
and Territory with directions that they should be conspicuously
displayed in their offices. The Comptroller of the Currency prepared
and sent to all national banks a circular letter, urging them to call
the attention of their patrons to the desirability of obtaining the
bonds as an investment, and to aid in stimulating subscriptions; and
with this was forwarded a complete set of papers similar to those sent
to the postmasters. These papers were also sent to other banks and
financial institutions and to bankers in all parts of the country,
and, in addition, notice was given that they could be obtained upon
application to the Treasury Department or any of the subtreasuries
of the United States. Soon afterward, in view of the large amount of
the bonds offered, and as a precaution against an undue strain upon
the general money market, as well as to permit the greatest possible
opportunity for subscription, the terms of the original offer of the
Secretary of the Treasury were modified by reducing in amount the
instalments of the purchase price and extending the time for their
payment.

On an examination of the bids at the expiration of the time limited
for their presentation, it was found that 4635 bids had been received,
after rejecting six which were palpably not genuine or not made in good
faith. The bidders were scattered through forty-seven of our States and
Territories, and the aggregate amount represented by their bids was
$526,970,000. The number of accepted bids upon which bonds were awarded
was only 828, and of these ten were forfeited after acceptance, on
account of non-payment of the first instalment of the purchase price.
Several of the bids accepted were for a single fifty-dollar bond, and
they varied in amount from that to one bid made by J. P. Morgan & Co.
and several associates for the entire issue of $100,000,000, for which
they offered 110.6877 on the dollar. To all the other 827 accepted
bidders who offered even the smallest fraction of a farthing more than
this the full number of bonds for which they bid were awarded.

The aggregate of the bonds awarded to these bidders, excluding the
Morgan bid, amounted to $62,321,150. The remainder of the entire
offering, including more than $4,700,000 of the awards which became
forfeited for non-payment as above mentioned, were awarded to Mr.
Morgan and his associates, their bid being the highest next to those on
which bonds had been awarded in full, as already stated.

The aggregate of the prices received for these bonds represented, by
reason of the premiums paid, an income to the investor of a trifle less
than three and four tenths per cent.

As a result of this large sale of bonds, the gold reserve, which, on
the last day of January, 1896, amounted to less than $50,000,000, was
so increased that at the end of February, in spite of withdrawals in
the meantime, it stood at nearly $124,000,000.

It will be observed that, notwithstanding all the efforts made to
distribute this issue of bonds among the people, but 827 bids out of
4641 were entitled to awards as being above the Morgan bid; and that
more than one third of all the bonds sold were awarded on the single
bid of Mr. Morgan and his associates.

The price received on this public sale was apparently somewhat better
for the Government than that secured by the Morgan-Belmont contract;
but their agreement required of them such labor, risk, and expense
as perhaps entitled them to a favorable bargain. In any event, the
advantages the Government derived from this contract were certainly
very valuable and should not be overlooked. On every sale of bonds by
public offering, not excluding that just mentioned, large amounts of
gold were withdrawn from the Treasury and used in paying for the bonds
offered. In the execution of the contract of February, 1895, no gold
was withdrawn for the purchase of the bonds, and the reserve received
the full benefit of the transaction. Each sale by public advertisement
made prior to the time of the contract had been so quickly followed
by extensive and wasting withdrawals of gold from the reserve, that
scarcely a breathing-time was allowed before we were again overtaken
by the necessity for its reinforcement. Even after the notice given
for the last sale on the eighth day of January, 1896, and between that
date and the 1st of June following, these withdrawals amounted to more
than $73,000,000, while during the six months or more of the existence
of the Morgan-Belmont contract the withdrawals of gold for export
were entirely prevented and a season of financial quiet and peace was
secured.

Whatever may be the comparative merits of the two plans for maintaining
our gold reserve, both of them when utilized were abundantly and
clearly justified.

Whether from fatigue of malign conditions or other causes, ever since
the last large sale of bonds was made the gold reserve has been so free
from depletion that its condition has caused no alarm.

Two hundred and sixty-two millions of dollars in bonds were issued on
its account during the critical time covered by this narrative; but the
credit and fair fame of our nation were saved.

I have attempted to give a detailed history of the crime charged
against an administration which “issued bonds of the Government in
time of peace.” Without shame and without repentance, I confess my
share of the guilt; and I refuse to shield my accomplices in this crime
who, with me, held high places in that administration. And though Mr.
Morgan and Mr. Belmont and scores of other bankers and financiers who
were accessories in these transactions may be steeped in destructive
propensities, and may be constantly busy in sinful schemes, I shall
always recall with satisfaction and self-congratulation my association
with them at a time when our country sorely needed their aid.

THE VENEZUELAN BOUNDARY CONTROVERSY

I

There is no better illustration of the truth that nations and
individuals are affected in the same manner by like causes than is
often furnished by the beginning, progress, and results of a national
boundary dispute. We all know that among individuals, when neighbors
have entered upon a quarrel concerning their division-line or the
location of a line fence, they will litigate until all account of
cost and all regard for the merits of the contention give place to
a ruthless and all-dominating determination, by fair means or foul,
to win; and if fisticuffs and forcible possession are resorted to,
the big, strong neighbor rejoices in his strength as he mauls and
disfigures his small and weak antagonist.

It will be found that nations behave in like fashion. One or the other
of two national neighbors claims that their dividing-line should be
defined or rectified in a certain manner. If this is questioned, a
season of diplomatic untruthfulness and finesse sometimes intervenes
for the sake of appearances. Developments soon follow, however, that
expose a grim determination behind fine phrases of diplomacy; and in
the end the weaker nation frequently awakens to the fact that it must
either accede to an ultimatum dictated by its stronger adversary, or
look in the face of war and a spoliation of its territory; and if such
a stage is reached, superior strength and fighting ability, instead of
suggesting magnanimity, are graspingly used to enforce extreme demands
if not to consummate extensive conquest or complete subjugation.

I propose to call attention to one of these unhappy national boundary
disputes, between the kingdom of Great Britain and the South American
republic of Venezuela, involving the boundary-line separating Venezuela
from the English colony of British Guiana, which adjoins Venezuela on
the east.

Venezuela, once a Spanish possession, declared her independence in
1810, and a few years afterward united with two other of Spain’s
revolted colonies in forming the old Colombian federal union, which
was recognized by the United States in 1822. In 1836 this union was
dissolved and Venezuela became again a separate and independent
republic, being promptly recognized as such by our Government and by
other powers. Spain, however, halted in her recognition until 1845,
when she quite superfluously ceded to Venezuela by treaty the territory
which as an independent republic she had actually owned and possessed
since 1810. But neither in this treaty nor in any other mention of
the area of the republic were its boundaries described with more
definiteness than as being “the same as those which marked the ancient
viceroyalty and captaincy-general of New Granada and Venezuela in the
year 1810.”

England derived title to the colony of Guiana from Holland in 1814,
by a treaty in which the territory was described as “the Cape of Good
Hope and the establishments of Demerara, Essequibo, and Berbice.” No
boundaries of those settlements or “establishments” were given in the
treaty, nor does it appear that any such boundaries had ever been
particularly defined.

It is quite apparent that the limits of these adjoining countries thus
lacking any mention of definite metes and bounds, were in need of
extraneous assistance before they could be exactly fixed, and that
their proper location was quite likely to lead to serious disagreement.
In such circumstances threatening complications can frequently be
avoided if the adjoining neighbors agree upon a divisional line
promptly, and before their demands are stimulated and their tenacity
increased by a real or fancied advance in the value of the possessions
to be divided, or other incidents have intervened to render it more
difficult to make concessions.

I shall not attempt to sketch the facts and arguments that bear upon
the exact merits of this boundary controversy between Great Britain and
Venezuela. They have been thoroughly examined by an arbitral tribunal
to which the entire difficulty was referred, and by whose determination
the boundary between the two countries has been fixed–perhaps in
strict accord with justice, but at all events finally and irrevocably.
Inasmuch, however, as our own country became in a sense involved in the
controversy, or at least deeply concerned in its settlement, I have
thought there might be interest in an explanation of the manner and the
processes by which the interposition of the United States Government
was brought about. I must not be expected to exclude from mention
every circumstance that may relate to the merits of the dispute as
between the parties primarily concerned; but so far as I make use of
such circumstances I intend to do so only in aid and simplification of
the explanation I have undertaken.

This dispute began in 1841. On October 5 of that year the Venezuelan
minister to Great Britain, in a note to Lord Aberdeen, Principal
Secretary of State for Foreign Affairs, after reminding the secretary
that a proposal made by Venezuela on the 28th of January, 1841, for
joint action in the matter of fixing a divisional boundary, still
awaited the acceptance of Great Britain, wrote as follows:

The Honorable Earl of Aberdeen may now judge of the surprise of
the Government of Venezuela upon learning that in the territory
of the Republic a sentry-box has been erected upon which the
British flag has been raised. The Venezuelan Government is in
ignorance of the origin and purport of these proceedings, and
hopes that they may receive some satisfactory explanation of
this action. In the meantime the undersigned, in compliance
with the instructions communicated to him, urges upon the
Honorable Earl of Aberdeen the necessity of entering into a
treaty of boundaries as a previous step to the fixation of
limits, and begs to ask for an answer to the above-mentioned
communication of January 28.

Lord Aberdeen, in his reply, dated October 21, 1841, makes the
following statement:

Her Majesty’s Government has received from the Governor of
British Guiana, Mr. Schomburgk’s report of his proceedings in
execution of the commission with which he has been charged.
That report states that Mr. Schomburgk set out from Demerara in
April last and was on his return to the Essequibo River at the
end of June. It appears that Mr. Schomburgk planted boundary
posts at certain points of the country which he has surveyed,
and that he was fully aware that the demarcation so made was
merely a preliminary measure, open to further discussion
between the Governments of Great Britain and Venezuela. But
it does not appear that Mr. Schomburgk left behind him any
guard-house, sentry-box, or other building having the British
flag.

With respect to the proposal of the Venezuelan Government
that the Governments of Great Britain and Venezuela should
conclude a treaty as a preliminary step to the demarcation
of the boundaries between British Guiana and Venezuela, the
undersigned begs leave to observe that it appears to him that
if it should be necessary to make a treaty upon the subject of
the boundaries in question, such a measure should follow rather
than precede the operation of the survey.

In a communication dated the 18th of November, 1841, the Venezuelan
minister, after again complaining of the acts of Schomburgk and
alleging that he “has planted at a point on the mouth of the Orinoco
several posts bearing Her Majesty’s initials, and raised at the
same place, with a show of armed forces, the British flag, and also
performed several other acts of dominion and government,” refers to
the great dissatisfaction aroused in Venezuela by what he calls “this
undeserved offense,” and adds: “The undersigned therefore has no doubts
but that he will obtain from Her Majesty’s Government a reparation for
the wrong done to the dignity of the Republic, and that those signs
which have so unpleasantly shaken public confidence will be ordered
removed.”

No early response having been made to this communication, another
was addressed to Lord Aberdeen, dated December 8, 1841, in which the
representative of Venezuela refers to his previous unanswered note and
to a recent order received from his government, which he says directs
him “to insist not only upon the conclusion of a treaty fixing the
boundaries between Venezuela and British Guiana, but also, and this
very particularly, to insist upon the removal of the signs set up,
contrary to all rights, by the surveyor R. H. Schomburgk in Barima
and in other points of the Venezuelan territory”; and he continues:
“In his afore-mentioned communication of the 18th of last month, the
undersigned has already informed the Honorable Earl of Aberdeen of
the dissatisfaction prevailing among the Venezuelans on this account,
and now adds that this dissatisfaction, far from diminishing, grows
stronger–as is but natural–as time goes on and no reparation of the
wrongs is made.”

These two notes of the Venezuelan minister were answered on the
eleventh day of December, 1841. In his reply Lord Aberdeen says:

The undersigned begs leave to refer to his note of the 21st
of October last, in which he explained that the proceeding of
Mr. Schomburgk in planting boundary posts at certain points
of the country which he has surveyed was merely a preliminary
measure open to future discussion between the two Governments,
and that it would be premature to make a boundary treaty before
the survey will be completed. The undersigned has only further
to state that much unnecessary inconvenience would result from
the removal of the posts fixed by Mr. Schomburgk, as they
will afford the only tangible means by which Her Majesty’s
Government can be prepared to discuss the question of the
boundaries with the Government of Venezuela. These posts were
erected for that express purpose, and not, as the Venezuelan
Government appears to apprehend, as indications of dominion and
empire on the part of Great Britain.

In a reply to this note, after referring to the explanation of the
purpose of these posts or signs which Lord Aberdeen had given, it was
said, in further urging their removal: “The undersigned regrets to be
obliged to again insist upon this point; but the damages sustained by
Venezuela on account of the permanence of said signs are so serious
that he hopes in view of those facts that the trouble resulting from
their removal may not appear useless.” The minister followed this
insistence with such earnest argument that on the thirty-first day of
January, 1842, nearly four months after the matter was first agitated,
Lord Aberdeen informed the Venezuelan minister that instructions would
be sent to the governor of British Guiana directing him to remove the
posts which had been placed by Mr. Schomburgk near the Orinoco. He,
however, accompanied this assurance with the distinct declaration
“that although, in order to put an end to the misapprehension which
appears to prevail in Venezuela with regard to the object of Mr.
Schomburgk’s survey, the undersigned has consented to comply with the
renewed representation of the Minister upon this affair, Her Majesty’s
Government must not be understood to abandon any portion of the rights
of Great Britain over the territory which was formerly held by the
Dutch in Guiana.”

It should be here stated that the work which Schomburgk performed
at the instance of the British Government consisted not only in
placing monuments of some sort at the mouth of the Orinoco River,
upon territory claimed by Venezuela, but also in locating from such
monuments a complete dividing-line running far inland and annexing to
British Guiana on the west a large region which Venezuela also claimed.
This line, as originally located or as afterward still further extended
to the west, came to be called “the Schomburgk line.”

The Orinoco River, flowing eastward to the sea, is a very broad
and deep waterway, which, with its affluents, would in any event,
and however the bounds of Venezuela might be limited, traverse a
very extensive portion of that country’s area; and its control and
free navigation are immensely important factors in the progress and
prosperity of the republic. Substantially at the mouth of the Orinoco,
and on its south side, two quite large rivers, the Barima and the
Amacuro, flow into the sea. The region adjacent to the mouth of those
rivers has, sometimes at least, been called Barima; and it was here
that the posts or signs complained of by Venezuela were placed.

The coast from the mouth of the Orinoco River slopes or drops to the
east and south; and some distance from that river’s mouth, in the
directions mentioned, the Essequibo, a large river flowing for a long
distance from the south, empties into the sea.

After the correspondence I have mentioned, which resulted in the
removal of the so-called initial monuments of the Schomburgk line
from the Barima region, there seems to have been less activity in
the boundary discussion until January 31, 1844, when the Venezuelan
minister to England again addressed Lord Aberdeen on the subject.
He referred to the erection of the Schomburgk monuments and the
complaints of Venezuela on that account, and stated that since the
removal of those monuments he had not ceased to urge Lord Aberdeen “to
commence without delay negotiations for a treaty fixing definitely
the boundary-line that shall divide the two countries.” He adds the
following very sensible statement: “Although it was undoubtedly
the duty of the one who promoted this question to take the first
step toward the negotiation of the treaty, the undersigned being
well aware that other important matters claim the attention of Her
Majesty’s Government, and as he ought not to wait indefinitely, hastens
to propose an agreement which, if left for a later date, may be
difficult to conclude.” It is disappointing to observe that the good
sense exhibited in this statement did not hold out to the end of the
minister’s communication. After a labored presentation of historical
incidents, beginning with the discovery of the American continent,
he concludes by putting forward the Essequibo River as the proper
boundary-line between the two countries. This was a proposition of
such extreme pretensions that the Venezuelan representative knew, or
ought to have known, it would not be considered for a moment by the
Government of Great Britain; and it seems to me that a diplomatic error
was made when, failing to apprehend the fact that the exigencies of the
situation called for a show of concession, the Venezuelan minister,
instead of intimating a disposition to negotiate, gave Great Britain an
opportunity to be first in making proposals apparently calculated to
meet the needs of conciliation and compromise.

Thus two months after the receipt of this communication,–on the
thirtieth day of March, 1844,–Lord Aberdeen sent his reply. After
combating the allegations contained in the letter of the Venezuelan
representative, he remarked that if he were inclined to act upon the
spirit of that letter, it was evident that he ought to claim on behalf
of Great Britain, as the rightful successor to Holland, all the coast
from the Orinoco to the Essequibo. Then follows this significant
declaration:

But the undersigned believes that the negotiations would not
be free from difficulties if claims that cannot be sustained
are presented, and shall not therefore follow Señor Fortique’s
example, but state here the concessions that Great Britain
is disposed to make of her rights, prompted by a friendly
consideration for Venezuela and by her desire to avoid all
cause of serious controversies between the two countries. Being
convinced that the most important object for the interests
of Venezuela is the exclusive possession of the Orinoco, Her
Majesty’s Government is ready to yield to the Republic of
Venezuela a portion of the coast sufficient to insure her the
free control of the mouth of this her principal river, and to
prevent its being under the control of any foreign power.

Lord Aberdeen further declared that, “with this end in view, and
being persuaded that a concession of the greatest importance has been
made to Venezuela,” he would consent on behalf of Great Britain to a
boundary which he particularly defined, and in general terms may be
described as beginning in the mouth of the Moroco River, which is on
the coast southeast of the mouth of the Orinoco River and about two
thirds of the distance between that point and the Essequibo River, said
boundary running inland from that point until it included in its course
considerably more territory than was embraced within the original
Schomburgk line, though it excluded the region embraced within that
line adjacent to the Barima and Amacuro rivers and the mouth of the
Orinoco.

This boundary, as proposed by Lord Aberdeen, was not satisfactory to
Venezuela; and soon after its submission her diplomatic representative
died. This interruption was quickly followed by a long period of
distressing internal strifes and revolutions, which so distracted and
disturbed her government that for more than thirty years she was not in
condition to renew negotiations for an adjustment of her territorial
limits.

During all this time Great Britain seemed not especially unwilling to
allow these negotiations to remain in abeyance.

This interval was not, however, entirely devoid of boundary incidents.
In 1850 great excitement and indignation were aroused among the
Venezuelans by a rumor that Great Britain intended to take possession
of Venezuelan Guiana, a province adjoining British Guiana on the west,
and a part of the territory claimed by Venezuela; and the feeling thus
engendered became so extreme, both among the people and on the part of
the government of the republic, that all remaining friendliness between
the two countries was seriously menaced. Demonstrations indicating that
Venezuela was determined to repel the rumored movement as an invasion
of her rights, were met by instructions given by Great Britain to the
commander of her Majesty’s naval forces in the West Indies as to the
course he was to pursue if the Venezuelan forces should construct
fortifications within the territory in dispute. At the same time, Mr.
Balford Hinton Wilson, England’s representative at Caracas, in a note
addressed to the Minister of Foreign Affairs for Venezuela, indignantly
characterized these disquieting rumors of Great Britain’s intention
to occupy the lands mentioned, as mischievous, and maliciously false;
but he also declared that, on the other hand, her Majesty’s Government
would not see with indifference the aggressions of Venezuela upon the
disputed territory.

This note contained, in addition, a rather impressive pronouncement in
these words:

The Venezuelan Government, in justice to Great Britain, cannot
mistrust for a moment the sincerity of the formal declaration,
which is now made in the name and by the express order of Her
Majesty’s Government, that Great Britain has no intention to
occupy or encroach upon the territory in dispute; therefore the
Venezuelan Government, in an equal spirit of good faith and
friendship, cannot refuse to make a similar declaration to Her
Majesty’s Government, namely, that Venezuela herself has no
intention to occupy or encroach upon the territory in dispute.

The Minister of Foreign Affairs for Venezuela responded to this
communication in the following terms:

The undersigned has been instructed by His Excellency the
President of the Republic to give the following answer: The
Government never could be persuaded that Great Britain, in
contempt of the negotiation opened on the subject and the
alleged rights in the question of limits pending between the
two countries, would want to use force in order to occupy
the land that each side claims–much less after Mr. Wilson’s
repeated assurance, which the Executive Power believes to have
been most sincere, that those imputations had no foundation
whatever, being, on the contrary, quite the reverse of the
truth. Fully confident of this, and fortified by the protest
embodied in the note referred to, the Government has no
difficulty in declaring, as they do declare, that Venezuela
has no intention of occupying or encroaching upon any portion
of the territory the possession of which is in controversy;
neither will she look with indifference on a contrary
proceeding on the part of Great Britain.

In furtherance of these declarations the English Government stipulated
that it would not “order or sanction such occupations or encroachments
on the part of the British authorities”; and Venezuela agreed on her
part to “instruct the authorities of Venezuelan Guiana to refrain from
taking any step which might clash with the engagement hereby made by
the Government.”

I suspect there was some justification on each side for the accusations
afterward interchanged between the parties that this understanding or
agreement, in its strict letter and spirit, had not been scrupulously
observed.

As we now pass from this incident to a date more than twenty-five years
afterward, when attempts to negotiate for a settlement of the boundary
controversy were resumed, it may be profitable, before going further,
to glance at some of the conditions existing at the time of such
resumption.

II

In 1876–thirty-two years after the discontinuance of efforts on the
part of Great Britain and Venezuela to fix by agreement a line which
should divide their possessions–Venezuela was confronted, upon the
renewal of negotiations for that purpose, by the following conditions:

The claim by her, of a divisional line, founded upon her conception of
strict right, which her powerful opponent had insisted could not in any
way be plausibly supported, and which therefore she would in no event
accept.

An indefiniteness in the limits claimed by Great Britain–so great
that, of two boundary-lines indicated or suggested by her, one had
been plainly declared to be “merely a preliminary measure open to
future discussion between the Governments of Great Britain and
Venezuela,” while the other was distinctly claimed to be based not on
any acknowledgment of the republic’s rights, but simply upon generous
concessions and a “desire to avoid all cause of serious controversies
between the two countries.”

A controversy growing out of this situation impossible of friendly
settlement except by such arrangement and accommodation as would
satisfy Great Britain, or by a submission of the dispute to arbitration.

A constant danger of such an extension of British settlements in the
disputed territory as would necessarily complicate the situation
and furnish a convenient pretext for the refusal of any concession
respecting the lands containing such settlements.

A continual profession on the part of Great Britain of her present
readiness to make benevolent concessions and of her willingness to
co-operate in a speedy adjustment, while at the same time neither
reducing her pretensions, nor attempting in a conspicuous manner to
hasten negotiations to a conclusion.

A tremendous disparity in power and strength between Venezuela and
her adversary, which gave her no hope of defending her territory or
preventing its annexation to the possessions of Great Britain in case
the extremity of force or war was reached.

The renewed negotiations began with a communication dated November
14, 1876, addressed by the Minister of Foreign Affairs for Venezuela
to Lord Derby, then Great Britain’s principal Secretary of State. In
this communication the efforts made between the years 1841 and 1844 to
establish by agreement a divisional line between the two countries,
and their interruption, were referred to, and the earnest desire was
expressed that negotiations for that purpose might at once be resumed.
The minister suggested no other line than the Essequibo River, but in
conclusion declared that the President of Venezuela was led to “hope
that the solution of this question, already for so many years delayed,
will be a work of very speedy and cordial agreement.”

On the same day that this note was written to Lord Derby, one was
also written by the same Venezuelan official to Mr. Fish, then our
Secretary of State. After speaking of the United States as “the most
powerful and the oldest of the Republics of the new continent, and
called on to lend to others its powerful moral support in disputes
with European nations,” the minister directs attention to the boundary
controversy between Venezuela and Great Britain and the great necessity
of bringing it to a speedy termination. He concludes as follows: “But
whatever may be the result of the new steps of the Government, it has
desired that the American Government might at once take cognizance
of them, convinced, as it is, that it will give the subject its kind
consideration and take an interest in having due justice done to
Venezuela.” A memorandum was inclosed with the note, setting forth the
claims of Venezuela touching the boundary location.

This appears to be the first communication addressed to our Government
on the subject of a controversy in which we afterward became very
seriously concerned.

A short time after the date of these communications, a Venezuelan envoy
to Great Britain was appointed; and, on the thirteenth day of February,
1877, he addressed to Lord Derby a note in which, after asserting the
right of Venezuela to insist upon the boundary previously claimed by
her, he declared the willingness of his government “to settle this
long-pending question in the most amicable manner,” and suggested
either the acceptance of a boundary-line such as would result from
a presentation by both parties of Spanish and Dutch titles, maps,
documents, and proofs existing before the advent in South America of
either Venezuela or British Guiana, or the adoption of “a conventional
line fixed by mutual accord between the Governments of Venezuela and
Great Britain after a careful and friendly consideration of the case,
keeping in view the documents presented by both sides, solely with the
object of reconciling their mutual interests, and to fix a boundary as
equitable as possible.” The suggestion is made that the adoption of
a divisional line is important “to prevent the occurrence of serious
differences in the future, particularly as Guiana is attracting the
general attention of the world on account of the immense riches which
are daily being discovered there.”

Let us here note that this renewal by Venezuela of her efforts to
settle her boundary-line was accompanied by two new features. These,
though in themselves entirely independent, became so related to each
other, and in their subsequent combination and development they so
imperiously affected our Government, that their coincident appearance
at this particular stage of the controversy may well strike us as
significant. One of these features was the abandonment by Venezuela of
her insistence upon a line representing her extreme claims, and which
England would not in any contingency accept, thus clearing the field
for possible arbitration; and the other was her earnest appeal to us
for our friendly aid. Neither should we fail to notice the new and
important reference of the Venezuelan envoy to the immense riches being
discovered in the disputed territory. Gold beneath soil in controversy
does not always hasten the adjustment of uncertain or disputed
boundary-lines.

On the twenty-fourth day of March, 1877, Lord Derby informed the
Venezuelan envoy that the governor of British Guiana was shortly
expected in London, and that he was anxious to await his arrival before
taking any steps in the boundary discussion.

After waiting for more than two years for a further answer from the
English Government, the Venezuelan representative in London, on the
19th of May, 1879, addressed a note on the subject to Lord Salisbury,
who, in the meantime, had succeeded Lord Derby. In this note reference
was made to the communication sent to Lord Derby in 1877, to the desire
expressed by him to await the arrival of the governor of British
Guiana before making reply, and to the fact that the communication
mentioned still remained unanswered; and on behalf of Venezuela her
representative repeated the alternative proposition made by him in
February, 1877, in these words: “The boundary treaty may be based
either on the acceptance of the line of strict right as shown by the
records, documents, and other authoritative proofs which each party may
exhibit, or on the acceptance at once by both Governments of a frontier
of accommodation which shall satisfy the respective interests of the
two countries”; and he concluded his note as follows:

If Her Britannic Majesty’s Government should prefer the
frontier of accommodation or convenience, then it would be
desirable that it should vouchsafe to make a proposition of an
arrangement, on the understanding that, in order to obviate
future difficulties and to give Great Britain the fullest
proof of the consideration and friendship which Venezuela
professes for her, my Government would not hesitate to accept
a demarcation that should satisfy as far as possible the
interests of the Republic.

At all events, my Lord, something will have to be done to
prevent this question from pending any longer.

Thirty-eight years ago my Government wrote urging Her Majesty’s
Government to have the Boundary Treaty concluded, and now
this affair is in the same position as in 1841, without any
settlement; meanwhile Guiana has become of more importance than
it was then, by reason of the large deposits of gold which have
been and still are met with in that region.

Now, at the date of this communication England’s most extreme claims
were indicated either by the Schomburgk line or by the line which
Lord Aberdeen suggested in 1844 as a concession. These were indeed the
only lines which Great Britain had thus far presented. When in such
circumstances, and with these lines distinctly in mind, the envoy of
Venezuela offered to abandon for his country her most extreme claims,
and asked that Great Britain should “vouchsafe to make a proposition
of an arrangement” upon the basis of a “frontier of accommodation or
convenience,” what answer had he a right to expect? Most assuredly he
had a right to expect that if Great Britain should prefer to proceed
upon the theory of “accommodation or convenience,” she would respond by
offering such a reduction of the claims she had already made as would
indicate a degree of concession or “accommodation” on her part that
should entitle her to expect similar concession from Venezuela.

What was the answer actually made? After a delay of nearly eight
months, on the tenth day of January, 1880, Lord Salisbury replied that
her Majesty’s Government were of the opinion that to argue the matter
on the ground of strict right would involve so many intricate questions
that it would be very unlikely to lead to a satisfactory solution of
the question, and they would therefore prefer the alternative “of
endeavoring to come to an agreement as to the acceptance by the two
Governments of a frontier of accommodation which shall satisfy the
respective interests of the two countries.”

He then gives a most startling statement of the English Government’s
claim, by specifying boundaries which overlap the Schomburgk line
and every other line that had been thought of or dreamed of before,
declaring that such claim is justified “by virtue of ancient treaties
with the aboriginal tribes and of subsequent cessions from Holland.” He
sets against this claim, or “on the other hand,” as he says, the fact
that the President of Venezuela, in a message dated February 20, 1877,
“put forward a claim on the part of Venezuela to the river Essequibo
as the boundary to which the Republic was entitled”–thereby giving
prejudicial importance to a claim of boundary made by the President
of Venezuela three years before, notwithstanding his Lordship was
answering a communication in which Venezuela’s present diplomatic
representative distinctly proposed “a frontier of accommodation.” His
declaration, therefore, that the boundary which was thus put forward by
the President of Venezuela would involve “the surrender of a province
now inhabited by forty thousand British subjects,” seems quite
irrelevant, because such a boundary was not then under consideration;
and in passing it may occur to us that the great delay in settling the
boundaries between the two countries had given abundant opportunity for
such inhabitation as Lord Salisbury suggests. His Lordship having thus
built up a contention in which he puts on one side a line which for the
sake of pacific accommodation Venezuela no longer proposes to insist
upon, and on the other a line for Great Britain so grotesquely extreme
as to appear fanciful, soberly observes:

The difference, therefore, between these two claims is
so great that it is clear that, in order to arrive at a
satisfactory arrangement, each party must be prepared to
make considerable concessions to the other; and although the
claim of Venezuela to the Essequibo River boundary could not
under any circumstances be entertained, I beg leave to assure
you that Her Majesty’s Government are anxious to meet the
Venezuelan Government in a spirit of conciliation, and would
be willing, in the event of a renewal of negotiations for a
general settlement of boundaries, to waive a portion of what
they consider to be their strict right, if Venezuela is really
disposed to make corresponding concessions on her part.

And ignoring entirely the humbly respectful request of the Venezuelan
minister that Great Britain would “vouchsafe to make a proposition
of an arrangement,” his Lordship thus concludes his communication:
“Her Majesty’s Government will therefore be glad to receive, and will
undertake to consider in the most friendly spirit, any proposal that
the Venezuelan Government may think fit to make for the establishment
of a boundary satisfactory to both nations.”

This is diplomacy–of a certain sort. It is a deep and mysterious
science; and we probably cannot do better than to confess our inability
to understand its intricacies and sinuosities; but at this point we can
hardly keep out of mind the methods of the shrewd, sharp trader who
demands exorbitant terms, and at the same time invites negotiation,
looking for a result abundantly profitable in the large range for
dicker which he has created.

An answer was made to Lord Salisbury’s note on the twelfth day of
April, 1880, in which the Venezuelan envoy stated in direct terms
that he had received specific instructions from his government for
the arrangement of the difficulty, by abandoning the ground of strict
right and “concurring in the adoption for both countries of a frontier
mutually convenient, and reconciling in the best possible manner their
respective interests–each party having to make concessions to the
other for the purpose of attaining such an important result.”

It will be remembered that in 1844, when this boundary question was
under discussion, Lord Aberdeen proposed a line beginning in the mouth
of the Moroco River, being a point on the coast south and east of the
mouth of the Orinoco, thus giving to Venezuela the control of that
river, but running inland in such a manner as to include, in the whole,
little if any less area than that included in the Schomburgk line;
and it will also be recalled that this line was not then acceptable
to Venezuela. It appears, however, that the delays and incidents of
thirty-six years had impressed upon the government of the republic
the serious disadvantages of her situation in contention with Great
Britain; for we find in this reply of the Venezuelan envoy the inquiry
“whether Her Britannic Majesty’s Government is disposed now, as it
was in 1844, to accept the mouth of the river Moroco as the frontier
at the coast.” To this Lord Salisbury promptly responded that the
attorney-general for the colony of British Guiana was shortly expected
in England, and that her Majesty’s Government would prefer to postpone
the boundary discussion until his arrival.

This was followed by a silence of five months, with no word or sign
from England’s Foreign Office; and in the meantime Earl Granville had
succeeded Lord Salisbury as Secretary of State for Foreign Affairs.
After waiting thus long, the representative of Venezuela, on the 23d
of September, 1880, reminded Lord Granville that in the preceding
April his immediate predecessor had informed him that the arrival of
the attorney-general of British Guiana was awaited before deciding the
question of boundaries between the two Guianas; and as he had not,
after the lapse of five months, been honored with a communication on
the subject, he was bound to suppose that the attorney-general had not
accomplished his voyage, in which case it was useless longer to wait
for him. He further reminded his Lordship that on the 24th of March,
1877, Lord Derby, then in charge of British foreign affairs, also
desired to postpone the consideration of the question until the arrival
in London of the governor of British Guiana, who was then expected, but
who apparently never came. He then proceeds as follows:

Consequently it is best not to go on waiting either for the
Governor or for the Attorney-General of the Colony, but
to decide these questions ourselves, considering that my
Government is now engaged in preparing the official map of the
Republic and wishes of course to mark out the boundaries on the
East.

In my despatch of the 12th of April last, I informed your
Excellency [Excellency’s predecessor?] that as a basis of a
friendly demarcation my Government was disposed to accept the
mouth of the River Moroco as the frontier on the coast. If
Her Britannic Majesty’s Government should accept this point
of departure, it would be very easy to determine the general
course of the frontier, either by means of notes or in verbal
conferences, as your Excellency might prefer.

On the twelfth day of February, 1881, Lord Granville, replying to
Venezuela’s two notes dated April 12 and September 23, 1880, informed
her representative, without explanation, that her Majesty’s Government
would not accept the mouth of the Moroco as the divisional boundary on
the coast.

A few days afterward, in an answer to this refusal, Venezuela’s
representative mentioned the extreme claims of the two countries and
the fact that it had been agreed between the parties that steps should
be taken to settle upon a frontier of accommodation; that in pursuance
thereof he had proposed as the point of departure for such a frontier
the mouth of the Moroco River, which was in agreement thus far with
the proposition made by Lord Aberdeen on behalf of Great Britain in
1844; and pertinently added: “Thus thirty-seven years ago Her Britannic
Majesty’s Government spontaneously proposed the mouth of the Moroco
River as the limit on the coast, a limit which your Excellency does
not accept now, for you are pleased to tell me so in the note which I
have the honor of answering.” He thereupon suggests another boundary,
beginning on the coast at a point one mile north of the mouth of
the Moroco River and thence extending inland in such manner as to
constitute a large concession on the part of Venezuela, but falling
very far short of meeting the claims of Great Britain. He declares,
however, that this demarcation “is the maximum of all concessions which
in this matter the Government of Venezuela can grant by way of friendly
arrangement.”

Apparently anticipating, as he well might, that the boundary he
proposed would fail of acceptance, he suggests that in such case
the two governments would have no alternative but to determine the
frontier by strict right, and that on this basis they would find it
impossible to arrive at an agreement. Therefore he declares that he has
received instructions from his government to urge upon Great Britain
the submission of the question to an arbitrator, to be chosen by both
parties, to whose award both governments should submit.

In this proposal of arbitration by Venezuela we find an approach to a
new phase of the controversy. At first, the two countries had stood
at arm’s-length, each asserting strict right of boundary, only to
be met by obstinate and unyielding resistance. Next, the field of
mutual concession and accommodation had been traversed, with no result
except damaging and dangerous delay. And now, after forty years of
delusive hope, the time seemed at hand when the feebler contestant must
contemplate ignominious submission to dictatorial exaction, or forcible
resistance, futile and distressing, unless honorable rest and justice
could be found in arbitration–the refuge which civilization has
builded among the nations of the earth for the protection of the weak
against the strong, and the citadel from which the ministries of peace
issue their decrees against the havoc and barbarism of war.

The reply of Lord Granville to the communication of the envoy of
Venezuela proposing an alternative of arbitration was delayed for seven
months; and when, in September, 1881, it was received, it contained a
rejection of the boundary offered by Venezuela and a proposal of a
new line apparently lacking almost every feature of concession; and,
singularly enough, there was not in this reply the slightest allusion
to Venezuela’s request for arbitration.

I do not find that this communication of Great Britain was ever
specifically answered, though an answer was often requested. No further
steps appear to have been taken until September 7, 1883, when Lord
Granville instructed the British minister to Venezuela to invite the
serious attention of the Venezuelan Government to the questions pending
between the two countries, with a view to their early settlement.
These questions are specified as relating to the boundary, to certain
differential duties imposed on imports from British colonies, and
to the claims of British creditors of the republic. His Lordship
declared in those instructions that as a preliminary to entering upon
negotiations it was indispensable that an answer should be given to the
pending proposal which had been made by her Majesty’s Government in
regard to the boundary.

The representations made to the Government of Venezuela by the British
minister, in obedience to those instructions, elicited a reply, in
which a provision of the Venezuelan constitution was cited prohibiting
the alienation or cession of any part of the territory of the republic;
and it was suggested that, inasmuch as the Essequibo line seemed
abundantly supported as the true boundary of Venezuela, a concession
beyond that line by treaty would be obnoxious to this constitutional
prohibition, whereas any reduction of territory brought about by a
decree of an arbitral tribunal would obviate the difficulty. Therefore
the urgent necessity was submitted for the selection of an arbitrator,
“who, freely and unanimously chosen by the two Governments, would judge
and pronounce a sentence of a definitive character.”

The representative of her Majesty’s Government, in a response dated
February 29, 1884, commented upon the new difficulty introduced by the
statement concerning the prohibition contained in the constitution of
the republic, and expressed a fear that if arbitration was agreed to,
the same prohibition might be invoked as an excuse for not abiding by
an award unfavorable to Venezuela; and it was declared that if, on the
other hand, the arbitrator should decide in favor of the Venezuelan
Government to the full extent of their claim, “a large and important
territory which has for a long period been inhabited and occupied by
Her Majesty’s subjects and treated as a part of the Colony of British
Guiana would be severed from the Queen’s dominions.” This declaration
is immediately followed by a conclusion in these words:

For the above-mentioned reasons, therefore, the circumstances
of the case do not appear to Her Majesty’s Government to be
such as to render arbitration applicable for a solution of the
difficulty; and I have accordingly to request you, in making
this known to the Venezuelan Government, to express to them
the hope of Her Majesty’s Government that some other means may
be devised for bringing this long-standing matter to an issue
satisfactory to both powers.

Let us pause here for a moment’s examination of the surprising refusal
of Great Britain to submit this difficulty to arbitration, and the
more surprising reasons presented for its justification. The refusal
was surprising because the controversy had reached such a stage that
arbitration was evidently the only means by which it could be settled
consistently with harmonious relations between the two countries.

It was on this ground that Venezuela proposed arbitration; and
she strongly urged it on the further ground that inasmuch as the
prohibition of her constitution prevented the relinquishment, by
treaty or voluntary act, of any part of the territory which her people
and their government claimed to be indubitably Venezuelan, such a
relinquishment would present no difficulties if it was in obedience
to a decree of a tribunal to which the question of ownership had been
mutually submitted.

In giving her reasons for rejecting arbitration Great Britain says in
effect: The plan you urge for the utter and complete elimination of
this constitutional prohibition–for its expurgation and destruction so
far as it is related to the pending dispute–is objectionable, because
we fear the prohibition thus eliminated, expunged, and destroyed will
still be used as a pretext for disobedience to an award which, for the
express purpose of avoiding this constitutional restraint, you have
invited.

The remaining objection interposed by Great Britain to the arbitration
requested by Venezuela is based upon the fear that an award might be
made in favor of the Venezuelan claim, in which case “a large and
important territory which has for a long period been inhabited and
occupied by Her Majesty’s subjects and treated as a part of the Colony
of British Guiana would be severed from the Queen’s dominions.”

It first occurs to us that a contention may well be suspected of
weakness when its supporters are unwilling to subject it to the test
of impartial arbitration. Certain inquiries are also pertinent in this
connection. Who were the British subjects who had long occupied the
territory that might through arbitration be severed from the Queen’s
dominions? How many of them began this occupancy during the more than
forty years that the territory had been steadily and notoriously
disputed? Did they enter upon this territory with knowledge of the
dispute and against the warning of the government to which they owed
allegiance, or were they encouraged and invited to such entry by
agencies of that government who had full notice of the uncertainty of
the British title? In one case, being themselves in the wrong, they
were entitled to no consideration; in the other, the question of loss
and indemnification should rest between them and their government,
which had impliedly guaranteed them against disturbance. In any event,
neither case presented a reason why Great Britain should take or
possess the lands of Venezuela; nor did either case furnish an excuse
for denying to Venezuela a fair and impartial adjudication of her
disputed rights. By whom had this territory “been treated as a part
of the Colony of British Guiana”? Surely not by Venezuela. On the
contrary, she had persistently claimed it as her own, and had “treated”
it as her own as far as she could and dared. England alone had treated
it as a part of British Guiana; her immense power had enabled her to do
this; and her decrees in her own favor as against her weak adversary
undoubtedly promised greater advantages than arbitration could possibly
assure.

III

The Secretary of State of Venezuela, soon after this refusal of Great
Britain to submit the boundary dispute to arbitration, in a despatch
dated the second day of April, 1884, still urged that method of
settlement, citing precedents and presenting arguments in its favor;
and in conclusion he asked the minister of the English Government at
Caracas “to have the goodness to think out and suggest any acceptable
course for attaining a solution of the difficulty.” This was followed,
a few days afterward, by another communication from the Venezuelan
Secretary of State, repeating his urgent request for arbitration. From
this communication it may not be amiss to make the following quotation:

Venezuela and Great Britain possess the same rights in the
question under discussion. If the Republic should yield up
any part of her pretensions, she would recognize the superior
right of Great Britain, would violate the above-quoted
article of the Constitution, and draw down the censure of
her fellow-citizens. But when both nations, putting aside
their independence of action in deference to peace and good
friendship, create by mutual consent a Tribunal which may
decide in the controversy, the same is able to pass sentence
that one of the two parties or both of them have been mistaken
in their opinions concerning the extent of their territory.
Thus the case would not be in opposition to the Constitution
of the Republic, there being no alienation of that which shall
have been determined not to be her property.

On the tenth day of June, 1884, arbitration was again refused in a curt
note from Lord Granville, declaring that “Her Majesty’s Government
adhere to their objection to arbitration as a mode of dealing with this
question.”

About this time complaints and protests of the most vigorous character,
based upon alleged breaches of the agreement of 1850 concerning the
non-occupation of the disputed territory broke out on both sides of
the controversy, and accusations of aggression and occupation were
constantly made. I shall not attempt to follow them, as in detail they
are not among the incidents which I consider especially relevant to the
presentation of my theme.

On the thirteenth day of December, 1884, Venezuela, in reply to a
proposition of the British Government that the boundary question and
certain other differences should be settled simultaneously, suggested,
in view of the unwillingness of Great Britain to submit the boundary
dispute to arbitration, that it should be presented for decision to
a court of law, the members of which should be chosen by the parties
respectively.

The British Government promptly declined this proposition, and stated
that they were not prepared to depart from the arrangement made in 1877
to decide the question by adopting a conventional boundary fixed by
mutual accord between the two governments. This was in the face of the
efforts which had been made along that line and found utterly fruitless.

Immediately following the last-mentioned proposition by Venezuela
for the presentation of the difficulty to a court of law mutually
chosen, negotiations were entered upon for the conclusion of a treaty
between Great Britain and Venezuela, which should quiet a difference
pending between the two countries relating to differential duties and
which should also dispose of other unsettled questions. In a draft of
such a treaty submitted by Venezuela there was inserted an article
providing for arbitration in case of all differences which could not
be adjusted by friendly negotiation. To this article Great Britain
suggested an amendment, making such arbitration applicable only to
matters arising out of the interpretation or execution of the treaty
itself, and especially excluding those emanating from any other source;
but on further representation by Venezuela, Lord Granville, in behalf
of the Government of Great Britain, expressly agreed with Venezuela
that the treaty article relating to arbitration should be unrestricted
in its operation. This diplomatic agreement was in explicit terms,
her Majesty’s Government agreeing “that the undertaking to refer
differences to arbitration shall include all differences which may
arise between the High Contracting Parties, and not those only which
arise on the interpretation of the Treaty.”

This occurred on the fifteenth day of May, 1885. Whatever Lord
Granville may have intended by the language used, the Government of
Venezuela certainly understood his agreement to include the pending
boundary dispute as among the questions that should be submitted to
arbitration; and all other matters which the treaty should embrace
seemed so easy of adjustment that its early completion, embodying a
stipulation for the final arbitration of the boundary controversy, was
confidently and gladly anticipated by the republic.

The high hopes and joyful anticipations of Venezuela born of this
apparently favorable situation were, however, but short-lived.

On the twenty-seventh day of July, 1885, Lord Salisbury, who in the
meantime had succeeded the Earl of Granville in Great Britain’s
Foreign Office, in a note to Venezuela’s envoy, declared: “Her
Majesty’s Government are unable to concur in the assent given by their
predecessors in office to the general arbitration article proposed
by Venezuela, and they are unable to agree to the inclusion in it of
matters other than those arising out of the interpretation or alleged
violation of this particular treaty.”

No assertion of the irrevocability of the agreement which Venezuela
had made with his predecessor, and no plea or argument of any kind,
availed to save the enlarged terms of this arbitration clause from Lord
Salisbury’s destructive insistence.

On the twentieth day of June, 1886, Lord Rosebery suggested for Great
Britain, and as a solution of the difficulty, that the territory within
two certain lines which had been already proposed as boundaries should
be equally divided between the contestants, either by arbitration or
the determination of a mixed commission.

This was declined by Venezuela on the twenty-ninth day of July, 1886,
upon the same grounds that led to the declination of prior proposals
that apparently involved an absolute cession of a part of her
territory; and she still insisted upon an arbitration embracing the
entire disputed territory as the only feasible method of adjustment.

This declination on the part of Venezuela of Lord Rosebery’s
proposition terminated the second attempt in point of time, to settle
this vexed question. In the meantime the aggressive conduct which for
some time the officials of both countries had exhibited in and near
the contested region had grown in distinctness and significance, until
Great Britain had openly and with notorious assertion of ownership
taken possession of a valuable part of the territory in dispute. On
the 26th of October, 1886, an official document was published in the
London “Gazette” giving notice that no grants of land made by the
Government of Venezuela in the territory claimed by Great Britain would
be admitted or recognized by her Majesty; and this more significant
statement was added: “A map showing the boundary between British
Guiana and Venezuela claimed by Her Majesty’s Government can be seen in
the library of the Colonial Office, Downing Street, or at the Office
of the Government Secretary, Georgetown, British Guiana.” The boundary
here spoken of, as shown on the map to which attention is directed,
follows the Schomburgk line. Protests and demands in abundance on the
part of Venezuela followed, which were utterly disregarded, until,
on the thirty-first day of January, 1887, the Venezuelan Secretary
of State distinctly demanded of Great Britain the evacuation of the
disputed territory which she was occupying in violation of prior
agreement and the rights of the republic, and gave formal notice
that unless such evacuation should be completed, and accompanied by
acceptance of arbitration as a means of deciding the pending frontier
dispute, by the twentieth day of February, 1887, diplomatic relations
between the two countries would on that day cease.

These demands were absolutely unheeded; and thereupon, when the
twentieth day of February arrived, Venezuela exhibited a long list of
specific charges of aggression and wrongdoing against Great Britain,
and made the following statement and final protest:

In consequence, Venezuela, not deeming it fitting to continue
friendly relations with a state which thus injures her,
suspends them from to-day.

And she protests before the Government of Her Britannic
Majesty, before all civilized nations, before the whole world,
against the acts of spoliation which the Government of Great
Britain has committed to her detriment, and which she will
never on any consideration recognize as capable of altering in
the slightest degree the rights which she has acquired from
Spain, and respecting which she will be always ready to submit
to a third power, as the only way to a solution compatible with
her constitutional principles.

Notwithstanding all this, three years afterward, and on the tenth day
of January, 1890, an agent of Venezuela, appointed for that purpose,
addressed a note to Lord Salisbury, still in charge of Great Britain’s
foreign relations, expressing the desire of Venezuela to renew
diplomatic relations with Great Britain, and requesting an interview to
that end.

A short time thereafter the Government of Great Britain expressed its
satisfaction that a renewal of diplomatic relations was in prospect,
and presented to the representative of Venezuela “a statement of the
conditions which Her Majesty’s Government considered necessary for
a satisfactory settlement of the questions pending between the two
countries.”

As the first of these conditions it was declared that “Her Majesty’s
Government could not accept as satisfactory any arrangement which did
not admit the British title to the territory comprised within the line
laid down by Sir R. Schomburgk in 1841; but they would be willing to
refer to arbitration the claims of Great Britain to certain territory
to the west of that line.”

Naturally enough, this statement was received by Venezuela with great
disappointment and surprise. Her representative promptly replied that
his government could not accept any single point of the arbitrary and
capricious line laid down by Sir R. Schomburgk in 1841, which had been
declared null and void even by the Government of her Majesty; and that
it was not possible for Venezuela to accept arbitration in respect to
territory west of that line. He further expressed his regret that the
conditions then demanded by Lord Salisbury were more unfavorable to
Venezuela than the proposals made to the former agent of the republic
prior to the suspension of diplomatic relations.

On the 19th of March, 1890, the British Government reiterated its
position more in detail. Its refusal to admit any question as to
Great Britain’s title to any of the territory within the Schomburgk
line was emphatically repeated, and the British claim was defined to
extend beyond any pretension which I believe had ever been previously
made except by Lord Salisbury himself in 1880. A map was presented
indicating this extreme claim, the Schomburgk line, and a certain part
of the territory between the boundary of this extreme claim on the
west and the Schomburgk line, which Great Britain proposed to submit
to arbitration, abandoning all claim to the remainder of the territory
between these last-named two lines. This scheme, if adopted, would give
to England absolutely and without question the large territory between
British Guiana’s conceded western boundary and the Schomburgk line,
with an opportunity to lay claim before a board of arbitration for
extensive additional territory beyond the Schomburgk line.

This is pitiful. The Schomburgk line, which was declared by the British
Government, at the time it was made, to be “merely a preliminary
measure, open to further discussion between the Governments of Great
Britain and Venezuela,” and which had been since largely extended in
some mysterious way, is now declared to be a line so well established,
so infallible, and so sacred that only the territory that England
exorbitantly claims beyond that line is enough in dispute to be
submitted to impartial arbitration. The trader is again in evidence.
On this basis England could abundantly afford to lose entirely in the
arbitration she at length conceded.

And yet Venezuela was not absolutely discouraged. Soon after the
receipt of Great Britain’s last depressing communication, she
appointed still another agent who was to try his hand with England
in the field of diplomacy. On the twenty-fourth day of June, 1890,
this new representative replied to the above proposal made to his
predecessor by her Majesty’s Government, and expressed the great
regret of Venezuela that its recent proposals for a settlement of the
boundary difficulty by arbitration affecting all the disputed territory
had been peremptorily declined. He also declared that the emphatic
statement contained in Great Britain’s last communication in reference
to this question created for his government “difficulties not formerly
contemplated,” and thereupon formally declined on behalf of Venezuela
the consideration of the proposals contained in said communication.
This statement of discouraging conditions was, however, supplemented by
a somewhat new suggestion to the effect that a preliminary agreement
should be made containing a declaration on the part of the Government
of Venezuela that the river Essequibo, its banks, and the lands
covering it belong exclusively to British Guiana, and a declaration
on the part of her Majesty’s Government that the Orinoco River, its
banks, and the lands covering it belong exclusively to Venezuela, and
providing that a mixed commission of two chief engineers and their
staffs should be appointed to make, within one year, careful maps and
charts of the region to the west and northwest of the Essequibo River,
toward the Orinoco, in order to determine officially the exact course
of its rivers and streams, and the precise position of its mountains
and hills, and all other details that would permit both countries to
have reliable official knowledge of the territory which was actually
in dispute, enabling them to determine with a mutual feeling of
friendship and good will a boundary with perfect knowledge of the case;
but in the event that a determination should not be thus reached,
the final decision of the boundary question should be submitted
to two arbitrators, one selected by each government, and a third
chosen by the other two, to act as umpire in case of disagreement,
who, in view of the original titles and documents presented, should
fix a boundary-line which, being in accordance with the respective
rights and titles, should have the advantage as far as possible of
constituting a natural boundary; and that, pending such determination,
both governments should remove or withdraw all posts and other
indications and signs of possession or dominion on said territory, and
refrain from exercising any jurisdiction within the disputed region.

On the 24th of July, 1890, Lord Salisbury declined to accept these
suggestions of the Venezuelan representative, and declared: “Her
Majesty’s Government have more than once explained that they cannot
consent to submit to arbitration what they regard as their indisputable
title to districts in the possession of the British Colony.”

Is it uncharitable to see in this reference to “possession” a hint
of the industrious manner in which Great Britain had attempted to
improve her position by permitting colonization, and by other acts of
possession, during the half-century since the boundary dispute began?

Efforts to settle this controversy seem to have languished after this
rebuff until March, 1893, when still another agent was appointed by
Venezuela for the purpose of reëstablishing diplomatic relations with
Great Britain, and settling, if possible, the boundary trouble and
such other differences as might be pending between the two countries.
As a means to that end, this agent, on the twenty-sixth day of May,
1893, presented a memorandum to the British Government containing
suggestions for such settlement. The suggestion relating to the
adjustment of the boundary question rested upon the idea of arbitration
and did not materially differ from that made by this agent’s immediate
predecessor in 1890, except as to the _status quo_, pending final
adjustment, which it was proposed should be the same as that existing
after the agreement of non-interference in the disputed territory made
by the two governments in 1850.

The plan thus suggested was declined by the Government of Great
Britain, because, in the first place, it involved an arbitration,
“which had been repeatedly declined by Her Majesty’s Government,” and,
further, because it was, in the language of the British reply, “quite
impossible that they should consent to revert to the _status quo_ of
1850 and evacuate what has for some years constituted an integral
portion of British Guiana.”

A further communication from the agent of Venezuela, offering
additional arguments in support of his suggestions, brought forth
a reply informing him that the contents of his note did not “appear
to Her Majesty’s Government to afford any opening for arriving at an
understanding on this question which they could accept.”

Six months afterward, on the twenty-ninth day of September, 1893, a
final communication was addressed by the representative of Venezuela to
the British Government, reviewing the situation and the course of past
efforts to arrive at a settlement, and concluding with the words:

I must now declare in the most solemn manner, and in the name
of the Government of Venezuela, that it is with the greatest
regret that that Government sees itself forced to leave the
situation produced in the disputed territory by the acts of
recent years unsettled, and subject to the serious disturbances
which acts of force cannot but produce; and to declare that
Venezuela will never consent to proceedings of that nature
being accepted as title-deeds to justify the arbitrary
occupation of territory which is within its jurisdiction.

Here closed a period in this dispute, fifty-two years in duration,
vexed with agitation, and perturbed by irritating and repeated failures
to reach a peaceful adjustment. Instead of progress in the direction
of a settlement of their boundaries, the results of their action were
increased obstacles to fair discussion, intensified feelings of injury,
extended assertion of title, ruthless appropriation of the territory in
controversy, and an unhealed breach in diplomatic relations.

IV

I have thus far dealt with this dispute as one in which Great Britain
and Venezuela, the parties primarily concerned, were sole participants.
We have now, however, reached a stage in the affair which requires
a recital of other facts which led up to the active and positive
interference of our own Government in the controversy. In discussing
this branch of our topic it will be necessary not only to deal with
circumstances following those already narrated, but to retrace our
steps sufficiently to exhibit among other things the appeals and
representations made to the Government of the United States by
Venezuela, while she was still attempting to arrive at an adjustment
with Great Britain.

I have already referred to the first communication made to us by
Venezuela on the subject. This, it will be remembered, was in 1876,
when she sought to resume negotiations with Great Britain, after an
interruption of thirty-two years. I have also called attention to the
fact that coincident with this communication Venezuela presented to
Great Britain a willingness to relax her insistence upon her extreme
boundary claim, based upon alleged right, and suggested that a
conventional line might be fixed by mutual concession.

Venezuela’s first appeal to us for support and aid amounted to little
more than a vague and indefinite request for countenance and sympathy
in her efforts to settle her differences with her contestant, with
an expression of a desire that we would take cognizance of her new
steps in that direction. I do not find that any reply was made to this
communication.

Five years afterward, in 1881, the Venezuelan minister in Washington
presented to Mr. Evarts, then our Secretary of State, information he
had received that British vessels had made their appearance in the
mouth of the Orinoco River with materials to build a telegraph-line,
and had begun to erect poles for that purpose at Barima: and he
referred to the immense importance to his country of the Orinoco;
to the efforts of his government to adjust her difficulty with
Great Britain, and to the delays interposed; and finally expressed
his confident belief that the United States would not view with
indifference what was being done in a matter of such capital importance.

Mr. Evarts promptly replied, and informed the Venezuelan representative
that “in view of the deep interest which the Government of the United
States takes in all transactions tending to attempted encroachments
of foreign powers upon the territory of any of the republics of this
continent, this Government could not look with indifference to the
forcible acquisition of such territory by England, if the mission of
the vessels now at the mouth of the Orinoco should be found to be for
that end.”

Again, on the thirtieth day of November, 1881, our minister to
Venezuela reported to Mr. Blaine, who had succeeded Mr. Evarts as
Secretary of State, an interview with the President of Venezuela
at his request, in which the subject of the boundary dispute was
discussed. Our minister represented that the question was spoken of
by the President as being of essential importance and a source of
great anxiety to him, involving a large and fertile territory between
the Essequibo and Orinoco, and probably the control of the mouth
and a considerable portion of the latter river; and he alleged that
the policy of Great Britain, in the treatment of this question, had
been delay–the interval being utilized by gradually but steadily
extending her interest and authority into the disputed territory; and
“that, though the rights of Venezuela were clear and indisputable, he
questioned her ability, unaided by some friendly nation, to maintain
them.”

In July, 1882, Mr. Frelinghuysen, successor to Mr. Blaine, sent to
our representative at Venezuela a despatch to be communicated to the
government of the republic, in which he stated that, if Venezuela
desired it, the United States would propose to the Government of Great
Britain that the boundary question be submitted to the arbitrament of a
third power.

It will be remembered that a proposition for arbitration had been made
by Venezuela to Great Britain in February, 1881, and that Great Britain
had refused to accede to it.

In July, 1884, Mr. Frelinghuysen sent a confidential despatch to Mr.
Lowell, our minister to Great Britain, informing him that Guzman
Blanco, ex-President of Venezuela, who had recently been accredited as
a special envoy from his country to Great Britain, had called on him
relative to the objects of his mission, in respect of which he desired
to obtain the good offices of this Government, and that doubtless he
would seek to confer with Mr. Lowell in London. He further informed
Mr. Lowell that he had told the Venezuelan envoy that, “in view of our
interest in all that touches the independent life of the Republics of
the American Continent, the United States could not be indifferent to
anything that might impair their normal self-control”; that “the moral
position of the United States in these matters was well known through
the enunciation of the Monroe Doctrine,” though formal action in the
direction of applying that doctrine to a speculative case affecting
Venezuela seemed to him to be inopportune, and therefore he could not
advise Venezuela to arouse a discussion of that point. He instructed
our minister to show proper consideration to the Venezuelan envoy, and
to “take proper occasion to let Lord Granville know that we are not
without concern as to whatever may affect the interest of a sister
Republic of the American Continent and its position in the family of
nations.”

In July, 1885, the Venezuelan minister to the United States addressed
a communication to Secretary of State Bayard, setting forth the
correspondence which had already taken place between our Government and
that of Venezuela touching the boundary dispute, and referring to the
serious condition existing on account of the renewed aggressions of
Great Britain.

Mr. Bayard thereupon sent a despatch on the subject to Mr. Phelps,
our diplomatic representative to England, in which, after stating
that the Venezuelan Government had never definitely declared what
course she desired us to pursue, but, on the contrary, had expressed
a desire to be guided by our counsel, he said: “The good offices of
this Government have been tendered to Venezuela to suggest to Great
Britain the submission of the boundary dispute to arbitration; but when
shown that such action on our part would exclude us from acting as
arbitrator, Venezuela ceased to press the matter in that direction”;
and the next day after writing this despatch Mr. Bayard informed the
Venezuelan minister that the President of the United States could not
entertain a request to act as umpire in any dispute unless it should
come concurrently from both contestants.

In December, 1886, our minister to Venezuela addressed a despatch
to Mr. Bayard, in which he reported that matters looked very angry
and threatening in Venezuela on account of fresh aggressions on the
part of Great Britain in the disputed territory; and he expressed the
fear that an open rupture might occur between the two countries.
He inclosed a statement made by the Venezuelan Minister of Foreign
Affairs, containing a list of grievances, followed by this declaration:
“Venezuela, listening to the advice of the United States, has
endeavored several times to obtain that the difference should be
submitted to the award of a third power…. But such efforts have
proven fruitless, and the possibility of that result, the only one
prescribed by our constitution, being arrived at, becomes more and
more remote from day to day. Great Britain has been constant in her
clandestine advances upon the Venezuelan territory, not taking into
consideration either the rights or the complaints of this Republic.”
And he adds the following declaration: “Under such circumstances the
Government has but two courses left open: either to employ force in
order to recover places from which force has ejected the Republic,
since its amicable representations on the subject have failed to secure
redress, or to present a solemn protest to the Government of the United
States against so great an abuse, which is an evident declaration of
war–a provocative aggression.”

Thereupon, and on the twentieth day of December, 1886, a despatch was
sent by Mr. Bayard to Mr. Phelps, in which the secretary comments
on the fact that at no time theretofore had the good offices of our
Government been actually tendered to avert a rupture between Great
Britain and Venezuela, and that our inaction in this regard seemed
to be due to the reluctance of Venezuela to have the Government of
the United States take any steps having relation to the action of the
British Government which might, in appearance even, prejudice the
resort to our arbitration or mediation which Venezuela desired; but
that the intelligence now received warranted him in tendering the good
offices of the United States to promote an amicable settlement of the
difficulty between the two countries, and offering our arbitration if
acceptable to both countries–as he supposed the dispute turned upon
simple and readily ascertainable historical facts.

Additional complaints against Great Britain on account of further
trespasses on Venezuelan territory were contained in a note from the
Venezuelan minister to Mr. Bayard, dated January 4, 1887. I shall quote
only the following passage:

My Government has tried all possible means to induce that
of London to accept arbitration, as advised by the United
States; this, however, has resulted in nothing but fresh
attempts against the integrity of the territory by the colonial
authorities of Demerara. It remains to be seen how long my
Government will find it possible to exercise forbearance
transcending the limits of its positive official duty.

Pursuant to his instructions from Mr. Bayard, our minister to Great
Britain formally tendered to the English Government, on the eighth day
of February, 1887, the good offices of the United States to promote
an amicable settlement of the pending controversy, and offered our
arbitration, if acceptable to both parties.

A few days afterward Lord Salisbury, on behalf of Great Britain,
replied that the attitude which had been taken by the President of the
Venezuelan republic precluded her Majesty’s Government from submitting
the question at that time to the arbitration of any third power.

The fact that Lord Salisbury had declined our offer of mediation and
arbitration, was promptly conveyed to the government of Venezuela;
and thereupon, on the fourth day of May, 1887, her minister at
Washington addressed another note to our Secretary of State indicating
much depression on account of the failure of all efforts up to that
time made to induce Great Britain to agree to a settlement of the
controversy by arbitration, and expressing the utmost gratitude for the
steps taken by our Government in aid of those efforts. He also referred
to the desire his government once entertained that, in case arbitration
could be attained, the United States might be selected as arbitrator,
and to the fact that this desire had been relinquished because the
maintenance of impartiality essential in an arbitrator would “seriously
impair the efficiency of action which for the furtherance of the common
interests of America, and in obedience to the doctrine of the immortal
Monroe, should possess all the vitality that the alarming circumstances
demand”; and he begged the secretary to instruct our representative in
London “to insist, in the name of the United States Government, upon
the necessity of submitting the boundary question between Venezuela and
British Guiana to arbitration.”

I have heretofore refrained from stating in detail the quite numerous
instances of quarrel and collision that occurred in and near the
disputed territory, with increasing frequency, during this controversy.
One of these, however, I think should be here mentioned. It seems
that in 1883 two vessels belonging to English subjects were seized
and their crews taken into custody by Venezuelan officials in the
disputed region, for alleged violations of the laws of Venezuela within
her jurisdiction, and that English officials had assumed, without any
judicial determination and without any notice to Venezuela, to assess
damages against her on account of such seizure and arrests, in an
amount which, with interest, amounted in 1887 to about forty thousand
dollars. On the seventh day of October in that year, the governor
of Trinidad, an English island near the mouth of the Orinoco, in a
letter to the Minister of Foreign Affairs for Venezuela, declared that
her Majesty’s Government could not permit such injuries to remain
unredressed, or their representations to be disregarded any longer,
and thereupon it was demanded that the money claimed, with interest,
be paid within seven days from the delivery of said letter. The letter
concluded as follows:

Failing compliance with the above demands Her Majesty’s
Government will be reluctantly compelled to instruct the
Commander of Her Majesty’s naval forces in the West Indies
to take such measures as he may deem necessary to obtain
that reparation which has been vainly sought for by friendly
means; and in case of so doing they will hold the Venezuelan
Government responsible for any consequences that may arise.

Venezuela did not fail to appreciate and frankly acknowledge that, in
her defenseless condition, there was no escape from the payment of the
sum which England, as a judge in its own cause, had decreed against
her. The President of the republic, however, in a prompt reply to the
governor’s note, characterized its terms as “offensive to the dignity
of the nation and to the equality which, according to the principles
of the rights of nations, all countries enjoy without any regard to
their strength or weakness.” Thereupon he sought the good offices of
our minister to Venezuela in an effort to procure a withdrawal of the
objectionable communication. This was attempted in a note sent by the
American minister to the governor of Trinidad, in which he said:

I hope your Excellency will permit me to suggest, as a mutual
friend of both parties, the suspension or withdrawal of your
note of the 7th instant, so that negotiations may at once
be opened for the immediate and final settlement of the
afore-mentioned claims without further resort to unpleasant
measures. From representations made to me, I am satisfied
that if the note of the 7th instant is withdrawn temporarily
even, Venezuela will do in the premises that which will prove
satisfactory to your Government.

A few days after this note was sent, a reply was received in which the
governor of Trinidad courteously expressed his thanks to our minister
for his good offices, and informed him that, as the Government of
Venezuela regarded his note of October 7 “as offensive, and appeared
desirous of at last settling this long-pending question in a friendly
spirit,” he promptly telegraphed to her Majesty’s Government asking
permission to withdraw that note and substitute a less forcible one for
it; and that he had just been informed by his home government in reply
that this arrangement could not be sanctioned.

Our minister reported this transaction to his home government at
Washington on the fourth day of November, 1887, and stated that the
money demanded by Great Britain had been paid by Venezuela under
protest.

Venezuela may have been altogether at fault in the transaction out
of which this demand arose; the amount which England exacted may not
have been unreasonable; and the method of its assessment, though not
the most considerate possible, has support in precedent; and even
the threat of a naval force may sometimes be justified in enforcing
unheeded demands. I have not adverted to this incident for the
purpose of inviting judgment on any of its phases, but only to call
attention to the fact that it was allowed to culminate with seemingly
studied accompaniments of ruthlessness and irritation, at a time when
a boundary question was pending between the two nations, when the
weaker contestant was importuning the stronger for arbitration, and
when a desire for reconciliation and peace in presence of strained
relations should have counseled considerateness and magnanimity–all
this in haughty disregard of the solicitous and expressed desire of
the Government of the United States to induce a peaceful adjustment
of the boundary dispute, and in curt denial of our request that
this especially disturbing incident should be relieved of its most
exasperating features.

In the trial of causes before our courts, evidence is frequently
introduced to show the animus or intent of litigating parties.

Perhaps strict decorum hardly permits us to adopt the following
language, used by the Venezuelan minister when reporting to our
Secretary of State the anticipated arrival of a British war-steamer to
enforce the demand of Great Britain:

Such alarming news shows evidently that the Government of Her
Britannic Majesty, encouraged by the impunity on which it has
counted until now for the realization of its unjust designs
with regard to Venezuela, far from procuring a pacific and
satisfactory agreement on the different questions pending with
the latter, is especially eager to complicate in order to
render less possible every day that equitable solution which
has been so fully the endeavor of my people.

On the fifteenth day of February, 1888, the Venezuelan minister, in
communicating to our Government information he had received touching a
decree of the governor of Demerara denying the validity of a contract
entered into by the Government of Venezuela for the construction of a
railway between certain points in the territory claimed by Venezuela,
commented on the affair as follows:

England has at last declared emphatically that her rights are
without limit, and embrace whatever regions may be suggested
to her by her insatiate thirst for conquest. She even goes
so far as to deny the validity of railway grants comprised
within territory where not even the wildest dream of fancy
had ever conceived that the day would come when Venezuela’s
right thereto could be disputed. The fact is that until now
England has relied upon impunity. She beholds in us a weak and
unfriended nation, and seeks to make the Venezuelan coast and
territories the base of a conquest which, if circumstances are
not altered, will have no other bounds than the dictates of her
own will.

V

Mr. Bayard, in a despatch transmitting this to our minister to England,
says that our Government has heretofore acted upon the assumption that
the boundary controversy between Great Britain and Venezuela was one
based on historical facts, which without difficulty could be determined
according to evidence, but that the British pretension now stated gives
rise to grave disquietude, and creates the apprehension that their
territorial claim does not follow historical traditions or evidence,
but is apparently indefinite. He refers to the British Colonial Office
list of previous years, and calls attention to the wide detour to the
westward in the boundaries of British Guiana between the years 1877 and
1887, as shown in that record. He suggests that our minister “express
anew to Lord Salisbury the great gratification it would afford our
Government to see the Venezuelan dispute amicably and honorably settled
by arbitration or otherwise,” and adds: “If indeed it should appear
that there is no fixed limit to the British boundary claim, our good
disposition to aid in a settlement might not only be defeated, but be
obliged to give place to a feeling of grave concern.”

It was about this time that the Venezuelan minister, in a note
expressing his appreciation of our efforts to bring about a settlement
of the dispute, made the following statement:

Disastrous and fatal consequences would ensue for the
independence of South America if, under the pretext of a
question of boundaries, Great Britain should succeed in
consummating the usurpation of a third part of our territory,
and therewith a river so important as the Orinoco. Under the
pretext of a mere question of boundaries which began on the
banks of the Essequibo, we now find ourselves on the verge of
losing regions lying more than five degrees away from that
river.

On May 1, 1890, Mr. Blaine, Mr. Bayard’s successor as Secretary of
State, instructed Mr. Robert T. Lincoln, our minister to England, “to
use his good offices with Lord Salisbury to bring about the resumption
of diplomatic intercourse between Great Britain and Venezuela as a
preliminary step toward the settlement of the boundary dispute by
arbitration.” He also requested him “to propose to Lord Salisbury,
with a view to an accommodation, that an informal conference be had in
Washington or in London of representatives of the three powers.” The
secretary added: “In such conference the position of the United States
is one solely of impartial friendship toward both litigants.”

In response to this instruction Mr. Lincoln had an interview with
Lord Salisbury. On this occasion his Lordship said that her Majesty’s
Government had not for some time been keen in attempts to settle the
dispute, in view of their feeling of uncertainty as to the stability
of the present Venezuelan Government and the frequency of revolutions
in that quarter; but that he would take pleasure in considering our
suggestion after consulting the Colonial Office, to which it would
first have to be referred. Mr. Lincoln, in giving his impressions
derived from the interview, says that “while Lord Salisbury did
not intimate what would probably be the nature of his reply, there
was certainly nothing unfavorable in his manner of receiving the
suggestion”; and he follows this with these significant words: “If the
matter had been entirely new and dissociated with its previous history,
I should have felt from his tone that the idea of arbitration in some
form, to put an end to the boundary dispute, was quite agreeable to
him.”

On the 26th of May, 1890, Lord Salisbury addressed a note to Mr.
Lincoln, in which his Lordship stated that her Majesty’s Government was
at that moment in communication with the Venezuelan minister in Paris,
who had been authorized to express the desire of his Government for the
renewal of diplomatic relations, and to discuss the conditions on which
it might be effected; that the terms on which her Majesty’s Government
considered that a settlement of the question in issue between the
two countries might be made, had been communicated to Venezuela’s
representative; that his reply was still awaited, and that the British
Government “would wish to have the opportunity of examining that
reply, and ascertaining what prospect it would afford of an adjustment
of existing differences, before considering the expediency of having
recourse to the good offices of a third party.”

No mention was made, in this communication, nor at any time thereafter,
so far as I can discover, of Mr. Blaine’s proposal of a conference
among representatives of the three nations interested in an adjustment.

Lord Salisbury, in a despatch to the English representative at
Washington, dated November 11, 1891, stated that our minister to
England had, in conversation with him, renewed, on the part of our
Government, the expression of a hope that the Government of Great
Britain would refer the boundary dispute to arbitration; that his
Lordship had expressed his willingness to submit to arbitration all the
questions which seemed to his government to be fairly capable of being
treated as questions of controversy; that the principal obstacle was
the rupture of diplomatic relations caused by Venezuela’s act; and that
before the Government of Great Britain could renew negotiations they
must be satisfied that those relations were about to be resumed with a
prospect of their continuance.

While our Government was endeavoring to influence Great Britain in the
direction of fair and just arbitration, and receiving for our pains
only barren assurances and procrastinating excuses, the appeals of
Venezuela for help, stimulated by allegations of constantly increasing
English pretensions, were incessantly ringing in our ears.

Without mentioning a number of these appeals, and passing over a period
of more than two years, I shall next refer to a representation made
by the Venezuelan minister at Washington on March 31, 1894, to Mr.
Gresham, who was then our Secretary of State. In this communication
the course of the controversy and the alleged unauthorized acts
of England from the beginning to that date were rehearsed with
circumstantial particularity. The conduct of Great Britain in refusing
arbitration was again reprobated, and pointed reference was made to
a principle which had been asserted by the United States, “that the
nations of the American continent, after having acquired the liberty
and independence which they enjoy and maintain, were not subject to
colonization by any European power.” The minister further declared that
“Venezuela has been ready to adhere to the conciliatory counsel of the
United States that a conference, consisting of its own Representative
and those of the two parties, should meet at Washington or London
for the purpose of preparing an honorable reëstablishment of harmony
between the litigants,” and that “Great Britain has disregarded the
equitable proposition of the United States.”

On July 13, 1894, Mr. Gresham sent a despatch to Mr. Bayard, formerly
Secretary of State, but then ambassador to England, inclosing the
communication of the Venezuelan minister, calling particular attention
to its contents, and at the same time briefly discussing the boundary
dispute. In this despatch Mr. Gresham said:

The recourse to arbitration first proposed in 1881, having been
supported by your predecessors, was in turn advocated by you,
in a spirit of friendly regard for the two nations involved.
In the meantime successive advances of British settlers in the
region admittedly in dispute were followed by similar advances
of British Colonial administration, contesting and supplanting
Venezuelan claims to exercise authority therein.

He adds: “Toward the end of 1887, the British territorial claim, which
had, as it would seem, been silently increased by some twenty-three
thousand square miles between 1885 and 1886, took another comprehensive
sweep westward to embrace” a certain rich mining district. “Since
then,” the secretary further states, “repeated efforts have been made
by Venezuela as a directly interested party, and by the United States
as the impartial friend of both countries, to bring about a resumption
of diplomatic relations, which had been suspended in consequence of the
dispute now under consideration.”

This despatch concludes as follows:

The President is inspired by a desire for a peaceable and
honorable adjustment of the existing difficulties between an
American state and a powerful transatlantic nation, and would
be glad to see the reëstablishment of such diplomatic relations
between them as would promote that end. I can discover but
two equitable solutions to the present controversy. One is the
arbitral determination of the rights of the disputants as the
respective successors to the historical rights of Holland and
Spain over the region in question. The other is to create a
new boundary-line in accordance with the dictates of mutual
expediency and consideration. The two Governments having so far
been unable to agree on a conventional line, the consistent
and conspicuous advocacy by the United States and England of
the principle of arbitration, and their recourse thereto in
settlement of important questions arising between them, makes
such a mode of adjustment especially appropriate in the present
instance; and this Government will gladly do what it can to
further a determination in that sense.

In another despatch to Mr. Bayard, dated December 1, 1894, Mr. Gresham
says:

I cannot believe Her Majesty’s Government will maintain that
the validity of their claim to territory long in dispute
between the two countries shall be conceded as a condition
precedent to the arbitration of the question whether Venezuela
is entitled to other territory, which until a recent period was
never in doubt. Our interest in the question has repeatedly
been shown by our friendly efforts to further a settlement
alike honorable to both countries, and the President is pleased
to know that Venezuela will soon renew her efforts to bring
about such an adjustment.

Two days afterward, on December 3, 1894, the President’s annual message
was sent to the Congress, containing the following reference to the
controversy:

The boundary of British Guiana still remains in dispute
between Great Britain and Venezuela. Believing that its early
settlement on some just basis alike honorable to both parties
is in the line of our established policy to remove from this
hemisphere all causes of difference with powers beyond the
sea, I shall renew the efforts heretofore made to bring about
a restoration of diplomatic relations between the disputants
and to induce a reference to arbitration–a resort which Great
Britain so conspicuously favors in principle and respects in
practice, and which is earnestly sought by her weaker adversary.

On the twenty-second day of February, 1895, a joint resolution was
passed by the Congress, earnestly recommending to both parties in
interest the President’s suggestion “that Great Britain and Venezuela
refer their dispute as to boundaries to friendly arbitration.”

A despatch dated February 23, 1895, from Great Britain’s Foreign
Office to the English ambassador at Washington, stated that on the
twenty-fifth day of January, 1895, our ambassador, Mr. Bayard, had, in
an official interview, referred to the boundary controversy, and said
“that his Government would gladly lend their good offices to bring
about a settlement by means of an arbitration.” The despatch further
stated that Mr. Bayard had thereupon been informed that her Majesty’s
Government had expressed their willingness to submit the question,
within certain limits, to arbitration, but could not agree to the
more extensive reference on which the Venezuelan Government insisted;
that Mr. Bayard called again on the twentieth day of February, when a
memorandum was read to him concerning the situation and a map shown him
of the territory in dispute; that at the same time he was informed that
the Venezuelans had recently made an aggression upon the territory of
English occupation, and, according to report, ill-treated some of the
colonial police stationed there, and that it was the boundary defined
by the Schomburgk line which had thus been violated in a marked manner
by the Venezuelans.

This despatch concludes as follows:

On Mr. Bayard’s observing that the United States Government
was anxious to do anything in their power to facilitate a
settlement of the difficulty by arbitration, I reminded his
Excellency that although Her Majesty’s Government were ready
to go to arbitration as to a certain portion of the territory
which I had pointed out to him, they could not consent to any
departure from the Schomburgk line.

It now became plainly apparent that a new stage had been reached in the
progress of our intervention, and that the ominous happenings embraced
within a few months had hastened the day when we were challenged to
take our exact bearings, lest we should miss the course of honor
and national duty. The more direct tone that had been given to our
despatches concerning the dispute, our more insistent and emphatic
suggestion of arbitration, the serious reference to the subject
in the President’s message, the significant resolution passed by
Congress earnestly recommending arbitration, all portended a growth of
conviction on the part of our Government concerning this controversy,
which gave birth to pronounced disappointment and anxiety when Great
Britain, concurrently with these apprising incidents, repeated in
direct and positive terms her refusal to submit to arbitration except
on condition that a portion of the disputed territory which Venezuela
had always claimed to be hers should at the outset be irrevocably
conceded to England.

During a period of more than fourteen years our Government, assuming
the character of a mutual and disinterested friend of both countries,
had, with varying assiduity, tendered its good offices to bring about
a pacific and amicable settlement of this boundary controversy, only
to be repelled with more or less civility by Great Britain. We had
seen her pretensions in the disputed regions widen and extend in
such manner and upon such pretexts as seemed to constitute an actual
or threatened violation of a doctrine which our nation long ago
established, declaring that the American continents are not to be
considered subjects for future colonization by any European power; and
despite all this we had, nevertheless, hoped, during all these years,
that arrangement and accommodation between the principal parties would
justify us in keeping an invocation of that doctrine in the background
of the discussion. Notwithstanding, however, all our efforts to avoid
it, we could not be unmindful of the conditions which the progress of
events had created, and whose meaning and whose exigencies inexorably
confronted us. England had finally and unmistakably declared that all
the territory embraced within the Schomburgk line was indisputably
hers. Venezuela presented a claim to territory within the same
limits, which could not be said to lack strong support. England
had absolutely refused to permit Venezuela’s claim to be tested by
arbitration; and Venezuela was utterly powerless to resist by force
England’s self-pronounced decree of ownership. If this decree was not
justified by the facts, and it should be enforced against the protest
and insistence of Venezuela and should result in the possession and
colonization of Venezuelan territory by Great Britain, it seemed quite
plain that the American doctrine which denies to European powers the
colonization of any part of the American continent would be violated.

If the ultimatum of Great Britain as to her claim of territory had
appeared to us so thoroughly supported upon the facts as to admit of
small doubt, we might have escaped the responsibility of insisting
on an observance of the Monroe Doctrine in the premises, on our own
account, and have still remained the disinterested friend of both
countries, merely contenting ourselves with benevolent attempts to
reconcile the disputants. We were, however, far from discovering
such satisfactory support in the evidence within our reach. On the
contrary, we believed that the effects of our acquiescence in Great
Britain’s pretensions would amount to a failure to uphold and maintain
a principle universally accepted by our Government and our people
as vitally essential to our national integrity and welfare. The
arbitration, for which Venezuela pleaded, would have adjudged the exact
condition of the rival claims, would have forever silenced Venezuela’s
complaints, and would have displaced by conclusive sentence our
unwelcome doubts and suspicions; but this Great Britain had refused to
Venezuela, and thus far had also denied to us.

Recreancy to a principle so fundamentally American as the Monroe
Doctrine, on the part of those charged with the administration of our
Government, was of course out of the question. Inasmuch, therefore,
as all our efforts to avoid its assertion had miscarried, there
was nothing left for us to do consistently with national honor but
to take the place of Venezuela in the controversy, so far as that
was necessary, in vindication of our American doctrine. Our mild
and amiable proffers of good offices, and the hopes we indulged
that at last they might be the means of securing to a weak sister
republic peace and justice, and to ourselves immunity from sterner
interposition, were not suited to the new emergency. In the advanced
condition of the dispute, sympathy with Venezuela and solicitude for
her distressed condition could no longer constitute the motive power of
our conduct, but these were to give way to the duty and obligation of
protecting our own national rights.

Mr. Gresham, who since the fourth day of March, 1893, had been our
Secretary of State, died in the latter days of May, 1895. His love
of justice, his sympathy with every cause that deserved sympathy, his
fearless and disinterested patriotism, and his rare mental endowments,
combined to make him a noble American and an able advocate of his
country’s honor. To such a man every phase of the Venezuelan boundary
dispute strongly appealed; and he had been conscientiously diligent
in acquainting himself with its history and in considering the
contingencies that might arise in its future development. Though his
death was most lamentable, I have always considered it a providential
circumstance that the Government then had among its Cabinet officers an
exceptionally strong and able man, in every way especially qualified
to fill the vacant place, and thoroughly familiar with the pending
controversy–which seemed every day to bring us closer to momentous
duty and responsibility.

Mr. Olney was appointed Secretary of State early in June, 1895; and
promptly thereafter, at the suggestion of the President, he began, with
characteristic energy and vigor, to make preparation for the decisive
step which it seemed should no longer be delayed.

The seriousness of the business we had in hand was fully understood,
and the difficulty or impossibility of retracing the step we
contemplated was thoroughly appreciated. The absolute necessity of
certainty concerning the facts which should underlie our action was, of
course, perfectly apparent. Whatever our beliefs or convictions might
be, as derived from the examination we had thus far given the case, and
however strongly we might be persuaded that Great Britain’s pretensions
could not be conceded consistently with our maintenance of the Monroe
Doctrine, it would, nevertheless, have been manifestly improper and
heedless on our part to find conclusively against Great Britain, before
soliciting her again and in new circumstances to give us an opportunity
to judge of the merits of her claims through the submission of them to
arbitration.

It was determined, therefore, that a communication should be prepared
for presentation to the British Government through our ambassador
to England, detailing the progress and incidents of the controversy
as we apprehended them, giving a thorough exposition of the origin
of the Monroe Doctrine, and the reasons on which it was based,
demonstrating our interest in the controversy because of its relation
to that doctrine, and from our new standpoint and on our own account
requesting Great Britain to join Venezuela in submitting to arbitration
their contested claims to the entire territory in dispute.

This was accordingly done; and a despatch to this effect, dated July
20, 1895, was sent by Mr. Olney to her Majesty’s Government through Mr.
Bayard, our ambassador.

The Monroe Doctrine may be abandoned; we may forfeit it by taking our
lot with nations that expand by following un-American ways; we may
outgrow it, as we seem to be outgrowing other things we once valued;
or it may forever stand as a guaranty of protection and safety in our
enjoyment of free institutions; but in no event will this American
principle ever be better defined, better defended, or more bravely
asserted than was done by Mr. Olney in this despatch.

After referring to the various incidents of the controversy, and
stating the conditions then existing, it was declared:

The accuracy of the foregoing analysis of the existing status
cannot, it is believed, be challenged. It shows that status to
be such, that those charged with the interests of the United
States are now forced to determine exactly what those interests
are and what course of action they require. It compels them
to decide to what extent, if any, the United States may and
should intervene in a controversy between, and primarily
concerning, only Great Britain and Venezuela, and to decide
how far it is bound to see that the integrity of Venezuelan
territory is not impaired by the pretensions of its powerful
antagonist.

After an exhaustive explanation and vindication of the Monroe Doctrine,
and after asserting that aggressions by Great Britain on Venezuelan
soil would fall within its purview, the despatch proceeded as follows:

While Venezuela charges such usurpation, Great Britain denies
it; and the United States, until the merits are authoritatively
ascertained, can take sides with neither. But while this
is so,–while the United States may not, under existing
circumstances at least, take upon itself to say which of the
two parties is right and which is wrong,–it is certainly
within its right to demand that the truth be ascertained.
Being entitled to resent and resist any sequestration of
Venezuelan soil by Great Britain, it is necessarily entitled to
know whether such sequestration has occurred or is now going
on…. It being clear, therefore, that the United States may
legitimately insist upon the merits of the boundary question
being determined, it is equally clear that there is but one
feasible mode of determining them, viz., peaceful arbitration.

The demand of Great Britain that her right to a portion of the disputed
territory should be acknowledged as a condition of her consent to
arbitration as to the remainder, was thus characterized:

It is not perceived how such an attitude can be defended, nor
how it is reconcilable with that love of justice and fair
play so eminently characteristic of the English race. It in
effect deprives Venezuela of her free agency and puts her under
virtual duress. Territory acquired by reason of it will be as
much wrested from her by the strong hand as if occupied by
British troops or covered by British fleets.

The despatch, after directing the presentation to Lord Salisbury of the
views it contained, concluded as follows:

They call for a definite decision upon the point whether Great
Britain will consent or decline to submit the Venezuelan
boundary question in its entirety to impartial arbitration. It
is the earnest hope of the President that the conclusion will
be on the side of arbitration, and that Great Britain will
add one more to the conspicuous precedents she has already
furnished in favor of that wise and just mode of settling
international disputes. If he is to be disappointed in that
hope, however,–a result not to be anticipated, and in his
judgment calculated to greatly embarrass the future relations
between this country and Great Britain,–it is his wish to be
made acquainted with the fact at such early date as will enable
him to lay the whole subject before Congress in his next annual
message.

The reply of Great Britain to this communication consisted of two
despatches addressed by Lord Salisbury to the British ambassador
at Washington for submission to our Government. Though dated the
twenty-sixth day of November, 1895, these despatches were not presented
to our State Department until a number of days after the assemblage of
the Congress in the following month. In one of these communications
Lord Salisbury, in dealing with the Monroe Doctrine and the right or
propriety of our appeal to it in the pending controversy, declared:
“The dangers which were apprehended by President Monroe have no
relation to the state of things in which we live at the present day.”
He further declared:

But the circumstances with which President Monroe was
dealing and those to which the present American Government
is addressing itself have very few features in common. Great
Britain is imposing no “system” upon Venezuela and is not
concerning herself in any way with the nature of the political
institutions under which the Venezuelans may prefer to live.
But the British Empire and the Republic of Venezuela are
neighbors, and they have differed for some time past, and
continue to differ, as to the line by which their dominions are
separated. It is a controversy with which the United States
have no apparent practical concern…. The disputed frontier
of Venezuela has nothing to do with any of the questions dealt
with by President Monroe.

His Lordship, in commenting upon our position as developed in Mr.
Olney’s despatch, defined it in these terms: “If any independent
American state advances a demand for territory of which its neighbor
claims to be the owner, and that neighbor is a colony of an European
state, the United States have a right to insist that the European state
shall submit the demand and its own impugned rights to arbitration.”

I confess I should be greatly disappointed if I believed that the
history I have attempted to give of this controversy did not easily and
promptly suggest that this definition of our contention fails to take
into account some of its most important and controlling features.

Speaking of arbitration as a method of terminating international
differences, Lord Salisbury said:

It has proved itself valuable in many cases, but it is not free
from defects which often operate as a serious drawback on
its value. It is not always easy to find an arbitrator who is
competent and who, at the same time, is wholly free from bias;
and the task of insuring compliance with the award when it is
made is not exempt from difficulty. It is a mode of settlement
of which the value varies much according to the nature of the
controversy to which it is applied and the character of the
litigants who appeal to it. Whether in any particular case
it is a suitable method of procedure is generally a delicate
and difficult question. The only parties who are competent
to decide that question are the two parties whose rival
contentions are in issue. The claim of a third nation which
is unaffected by the controversy to impose this particular
procedure on either of the two others cannot be reasonably
justified and has no foundation in the law of nations.

Immediately following this statement his Lordship again touched upon
the Monroe Doctrine for the purpose of specifically disclaiming its
acceptance by her Majesty’s Government as a sound and valid principle.
He says:

It must always be mentioned with respect, on account of the
distinguished statesman to whom it is due and the great nation
who have generally adopted it. But international law is founded
on the general consent of nations; and no statesman, however
eminent, and no nation, however powerful, are competent to
insert into the code of international law a novel principle
which was never recognized before, and which has not since been
accepted by the Government of any other country. The United
States have a right, like any other nation, to interpose in any
controversy by which their own interests are affected; and they
are the judge whether those interests are touched and in what
measure they should be sustained. But their rights are in no
way strengthened or extended by the fact that the controversy
affects some territory which is called American.

In concluding this despatch Lord Salisbury declared that her
Majesty’s Government “fully concur with the view which President
Monroe apparently entertained, that any disturbance of the existing
territorial distribution in that hemisphere by any fresh acquisitions
on the part of any European state would be a highly inexpedient change.
But they are not prepared to admit that the recognition of that
expediency is clothed with the sanction which belongs to a doctrine of
international law. They are not prepared to admit that the interests
of the United States are necessarily concerned in any frontier dispute
which may arise between any two of the states who possess dominions in
the Western Hemisphere; and still less can they accept the doctrine
that the United States are entitled to claim that the process of
arbitration shall be applied to any demand for the surrender of
territory which one of those states may make against another.”

The other despatch of Lord Salisbury, which accompanied the one upon
which I have commented, was mainly devoted to a statement of facts
and evidence on Great Britain’s side in the boundary controversy; and
in making such statement his Lordship in general terms designated the
territory to which her Majesty’s Government was entitled as being
embraced within the lines of the most extreme claim which she had at
any time presented. He added:

A portion of that claim, however, they have always been willing
to waive altogether; in regard to another portion they have
been and continue to be perfectly ready to submit the question
of their title to arbitration. As regards the rest, that which
lies within the so-called Schomburgk line, they do not consider
that the rights of Great Britain are open to question. Even
within that line they have on various occasions offered to
Venezuela considerable concessions as a matter of friendship
and conciliation and for the purpose of securing an amicable
settlement of the dispute. If, as time has gone on, the
concessions thus offered have been withdrawn, this has been the
necessary consequence of the gradual spread over the country of
British settlements, which Her Majesty’s Government cannot in
justice to the inhabitants offer to surrender to foreign rule.

In conclusion his Lordship asserts that his Government has

repeatedly expressed their readiness to submit to arbitration
the conflicting claims of Great Britain and Venezuela to large
tracts of territory which from their auriferous nature are
known to be of almost untold value. But they cannot consent
to entertain, or to submit to the arbitration of another
power or of foreign jurists however eminent, claims based on
the extravagant pretensions of Spanish officials in the last
century and involving the transfer of large numbers of British
subjects, who have for many years enjoyed the settled rule of
a British colony, to a nation of different race and language,
whose political system is subject to frequent disturbance, and
whose institutions as yet too often afford very inadequate
protection to life and property.

These despatches exhibit a refusal to admit such an interest in the
controversy on our part as entitled us to insist upon an arbitration
for the purpose of having the line between Great Britain and Venezuela
established; a denial of such force or meaning to the Monroe Doctrine
as made it worthy of the regard of Great Britain in the premises;
and a fixed and continued determination on the part of her Majesty’s
Government to reject arbitration as to any territory included within
the extended Schomburgk line. They further indicate that the existence
of gold within the disputed territory had not been overlooked; and
they distinctly put forward the colonization and settlement by English
subjects in such territory, during more than half a century of dispute,
as creating a claim to dominion and sovereignty, if not strong enough
to override all question of right and title, at least so clear and
indisputable as to be properly considered as above and beyond the
contingencies of arbitration.

If we had been obliged to accept Lord Salisbury’s estimate of the
Monroe Doctrine, and his ideas of our interest, or rather want of
interest, in the settlement of the boundary between Great Britain and
Venezuela, his despatches would have certainly been very depressing.
It would have been unpleasant for us to know that a doctrine which we
had supposed for seventy years to be of great value and importance to
us and our national safety was, after all, a mere plaything with which
we might amuse ourselves; and that our efforts to enforce it were to
be regarded by Great Britain and other European nations as meddlesome
interferences with affairs in which we could have no legitimate concern.

The reply of the English Government to Mr. Olney’s despatch, whatever
else it accomplished, seemed absolutely to destroy any hope we might
have entertained that, in our changed position in the controversy and
upon our independent solicitation, arbitration might be conceded to us.
Since, therefore, Great Britain was unwilling, on any consideration,
to coöperate with Venezuela in setting on foot an investigation of
their contested claim, and since prudence and care dictated that any
further steps we might take should be proved to be as fully justified
as was practicable in the circumstances, there seemed to be no better
way open to us than to inaugurate a careful independent investigation
of the merits of the controversy, on our own motion, with a view of
determining as accurately as possible, for our own guidance, where the
divisional line between the two countries should be located.

Mr. Olney’s despatch and Lord Salisbury’s reply were submitted to the
Congress on the seventeenth day of December, 1895, accompanied by a
message from the President.

In this message the President, after stating Lord Salisbury’s positions
touching the Monroe Doctrine, declared:

Without attempting extended argument in reply to these
positions, it may not be amiss to suggest that the doctrine
upon which we stand is strong and sound, because its
enforcement is important to our peace and safety as a nation,
and is essential to the integrity of our free institutions and
the tranquil maintenance of our distinctive form of government.
It was intended to apply to every stage of our national life,
and cannot become obsolete while our Republic endures. If the
balance of power is justly a cause for jealous anxiety among
the governments of the Old World and a subject for our absolute
non-interference, none the less is the observance of the Monroe
Doctrine of vital concern to our people and their Government.

Speaking of the claim made by Lord Salisbury that this doctrine had no
place in international law, it was said in the message: “The Monroe
Doctrine finds its recognition in those principles of international law
which are based upon the theory that every nation shall have its rights
protected and its just claims enforced.”

Referring to the request contained in Mr. Olney’s despatch that the
entire boundary controversy be submitted to arbitration, the following
language was used:

It will be seen from the correspondence herewith submitted that
this proposition has been declined by the British Government
upon grounds which in the circumstances seem to me to be far
from satisfactory. It is deeply disappointing that such an
appeal, actuated by the most friendly feelings toward both
nations directly concerned, addressed to the sense of justice
and to the magnanimity of one of the great powers of the world,
and touching its relations to one comparatively weak and small,
should have produced no better results.

The course to be pursued by this Government in view of the
present condition does not appear to admit of serious doubt.
Having labored faithfully for many years to induce Great
Britain to submit their dispute to impartial arbitration, and
having been finally apprised of her refusal to do so, nothing
remains but to accept the situation, to recognize its plain
requirements, and deal with it accordingly. Great Britain’s
present proposition has never thus far been regarded as
admissible by Venezuela, though any adjustment of the boundary
which that country may deem for her advantage and may enter
into of her own free will cannot, of course, be objected to
by the United States. Assuming, however, that the attitude of
Venezuela will remain unchanged, the dispute has reached such
a stage as to make it now incumbent upon the United States to
take measures to determine with sufficient certainty for its
justification what is the true divisional line between the
Republic of Venezuela and British Guiana. The inquiry to that
end should, of course, be conducted carefully and judicially;
and due weight should be given to all available evidence,
records, and facts in support of the claims of both parties.

After recommending to the Congress an adequate appropriation to
meet the expense of a commission which should make the suggested
investigation and report thereon with the least possible delay, the
President concluded his message as follows:

When such report is made and accepted, it will, in my opinion,
be the duty of the United States to resist by every means
in its power, as a wilful aggression upon its rights and
interests, the appropriation by Great Britain of any lands or
the exercise of governmental jurisdiction over any territory
which after investigation we have determined of right belongs
to Venezuela.

In making these recommendations I am fully alive to the
responsibility incurred, and keenly realize all the
consequences that may follow.

I am, nevertheless, firm in my conviction that while it is a
grievous thing to contemplate the two great English-speaking
peoples of the world as being otherwise than friendly
competitors in the onward march of civilization, and strenuous
and worthy rivals in all the arts of peace, there is no
calamity which a great nation can invite which equals that
which follows a supine submission to wrong and injustice, and
the consequent loss of national self-respect and honor, beneath
which are shielded and defended a people’s safety and greatness.

The recommendations contained in this message were acted upon with
such promptness and unanimity that on the twenty-first day of
December, 1895, four days after they were submitted, a law was passed
by the Congress authorizing the President to appoint a commission
“to investigate and report upon the true divisional line between
the Republic of Venezuela and British Guiana,” and making an ample
appropriation to meet the expenses of its work.

On the first day of January, 1896, five of our most able and
distinguished citizens were selected to constitute the commission; and
they immediately entered upon their investigation. At the outset of
their labors, and on the fifteenth day of January, 1896, the president
of the commission suggested to Mr. Olney the expediency of calling
the attention of the Governments of Great Britain and Venezuela to
the appointment of the commission, adding: “It may be that they would
see a way entirely consistent with their own sense of international
propriety to give the Commission the aid that it is no doubt in
their power to furnish in the way of documentary proof, historical
narrative, unpublished archives, or the like.” This suggestion, on its
presentation to the Government of Great Britain, was met by a most
courteous and willing offer to supply to our commission every means
of information touching the subject of their investigation which was
within the reach of the English authorities; and at all times during
the labors of the commission this offer was cheerfully fulfilled.

In the meantime, and as early as February, 1896, the question of
submitting the Venezuelan boundary dispute to mutual arbitration was
again agitated between the United States and Great Britain.

Our ambassador to England, in a note to Lord Salisbury, dated February
27, 1896, after speaking of such arbitration as seeming to be “almost
unanimously desired by both the United States and Great Britain,”
proposed, in pursuance of instructions from his Government, “an
entrance forthwith upon negotiations at Washington to effect this
purpose, and that Her Majesty’s Ambassador at Washington should be
empowered to discuss the question at that capital with the Secretary
of State.” He also requested that a definition should be given of
“settlements” in the disputed territory which it was understood her
Majesty’s Government desired should be excluded from the proposed
submission to arbitration.

Lord Salisbury, in his reply to this note, dated March 3, 1896, said:

The communications which have already passed between Her
Majesty’s Government and that of the United States have made
you acquainted with the desire of Her Majesty’s Government to
bring the difference between themselves and the Republic of
Venezuela to an equitable settlement. They therefore readily
concur in the suggestion that negotiations for this purpose
should be opened at Washington without unnecessary delay. I
have accordingly empowered Sir Julian Pauncefote to discuss the
question either with the representative of Venezuela or with
the Government of the United States acting as the friend of
Venezuela.

With this transfer of treaty negotiations to Washington, Mr. Olney
and Sir Julian Pauncefote, the ambassador of Great Britain to this
country, industriously addressed themselves to the subject. The
insistence of Great Britain that her title to the territory within
the Schomburgk line should not be questioned, was no longer placed by
her in the way of submitting the rights of the parties in the entire
disputed territory to arbitration. She still insisted, however, that
English settlers long in the occupancy of any of the territory in
controversy, supposing it to be under British dominion, should have
their rights scrupulously considered. Any difference of view that
arose from this proposition was adjusted without serious difficulty,
by agreeing that adverse holding or prescription during a period of
fifty years should make a good title, and that the arbitrators might
deem exclusive political control of a district, as well as actual
settlement, sufficient to constitute adverse holding or to make title
by prescription.

On the 10th of November, 1896, Mr. Olney addressed a note to the
president of the commission which had been appointed to investigate
the boundary question on behalf of our Government, in which he said:
“The United States and Great Britain are in entire accord as to the
provisions of a proposed treaty between Great Britain and Venezuela.
The treaty is so eminently just and fair as respects both parties–so
thoroughly protects the rights and claims of Venezuela–that I cannot
conceive of its not being approved by the Venezuelan President and
Congress. It is thoroughly approved by the counsel of Venezuela here
and by the Venezuelan Minister at this Capital.” In view of these
conditions he suggested a suspension of the work of the commission.

The treaty was signed at Washington by the representatives of Great
Britain and Venezuela on the second day of February, 1897. No part of
the territory in dispute was reserved from the arbitration it created.
It was distinctly made the duty of those appointed to carry out its
provisions, “to determine the boundary-line between the Colony of
British Guiana and the United States of Venezuela.”

The fact must not be overlooked that, notwithstanding this treaty
was promoted and negotiated by the officers of our Government, the
parties to it were Great Britain and Venezuela. This was a fortunate
circumstance, inasmuch as the work accomplished was thus saved from
the risk of customary disfigurement at the hands of the United States
Senate.

The arbitrators began their labors in the city of Paris in January,
1899, and made their award on the third day of October in the same year.

The line they determined upon as the boundary-line between the two
countries begins in the coast at a point considerably south and east of
the mouth of the Orinoco River, thus giving to Venezuela the absolute
control of that important waterway, and awarding to her valuable
territory near it. Running inland, the line is so located as to give
to Venezuela quite a considerable section of territory within the
Schomburgk line. This results not only in the utter denial of Great
Britain’s claim to any territory lying beyond the Schomburgk line, but
also in the award to Venezuela of a part of the territory which for a
long time England had claimed to be so clearly hers that she would not
consent to submit it to arbitration.

Thus, we have made a laborious and patient journey through the
incidents of a long dispute, to find at last a peaceful rest. As
we look back over the road we have traversed, and view again the
incidents we have passed on our way, some may be surprised that this
controversy was so long chronic, and yet, in the end, yielded so easily
to pronounced treatment. I know that occasionally some Americans
of a certain sort, who were quite un-American when the difficulty
was pending, have been very fond of lauding the extreme forbearance
and kindness of England toward us in our so-called belligerent and
ill-advised assertion of American principle. Those to whom this is a
satisfaction are quite welcome to it.

My own surprise and disappointment have arisen more from the honest
misunderstanding and the dishonest and insincere misrepresentation, on
the part of many of our people, regarding the motives and purposes of
the interference of the Government of the United States in this affair.
Some conceited and doggedly mistaken critics have said that it was
dreadful for us to invite war for the sake of a people unworthy of our
consideration, and for the purpose of protecting their possession of
land not worth possessing. It is certainly strange that any intelligent
citizen, professing information on public affairs, could fail to see
that when we aggressively interposed in this controversy it was
because it was necessary in order to assert and vindicate a principle
distinctively American, and in the maintenance of which the people
and Government of the United States were profoundly concerned. It was
because this principle was endangered, and because those charged with
administrative responsibility would not abandon or neglect it, that our
Government interposed to prevent any further colonization of American
soil by a European nation. In these circumstances neither the character
of the people claiming the soil as against Great Britain, nor the value
of the lands in dispute, was of the least consequence to us; nor did
it in the least concern us which of the two contestants had the best
title to any part of the disputed territory, so long as England did not
possess and colonize more than belonged to her–however much or however
little that might be. But we needed proof of the limits of her rights
in order to determine our duty in defense of our Monroe Doctrine;
and we sought to obtain such proof, and to secure peace, through
arbitration.

But those among us who most loudly reprehended and bewailed our
vigorous assertion of the Monroe Doctrine were the timid ones who
feared personal financial loss, or those engaged in speculation
and stock-gambling, in buying much beyond their ability to pay, and
generally in living by their wits. The patriotism of such people
traverses exclusively the pocket nerve. They are willing to tolerate
the Monroe Doctrine, or any other patriotic principle, so long as it
does not interfere with their plans, and are just as willing to cast it
off when it becomes troublesome.

But these things are as nothing when weighed against the sublime
patriotism and devotion to their nation’s honor exhibited by the great
mass of our countrymen–the plain people of the land. Though, in case
of the last extremity, the chances and suffering of conflict would have
fallen to their lot, nothing blinded them to the manner in which the
integrity of their country was involved. Not for a single moment did
their Government know the lack of their strong and stalwart support.

I hope there are but few of our fellow-citizens who, in retrospect,
do not now acknowledge the good that has come to our nation through
this episode in our history. It has established the Monroe Doctrine
on lasting foundations before the eyes of the world; it has given us
a better place in the respect and consideration of the people of all
nations, and especially of Great Britain; it has again confirmed
our confidence in the overwhelming prevalence among our citizens of
disinterested devotion to American honor; and last, but by no means
least, it has taught us where to look in the ranks of our countrymen
for the best patriotism.

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