GENTLEMEN OF THE CONGRESS: When I addressed myself to performing the duty laid upon the President by the Constitution to present to you an annual report on the state of the Union, I found my thought dominated by an immortal sentence of Abraham Lincoln's-"Let us have faith that right makes might, and in that faith let us dare to do our duty as we understand it" -a sentence immortal because it embodies in a form of utter simplicity and purity the essential faith of the nation, the faith in which it was conceived, and the faith in which it has grown to glory and power. With that faith and the birth of a nation founded upon it came the hope into the world that a new order would prevail throughout the affairs of mankind, an order in which reason and right would take precedence over covetousness and force; and I believe that I express the wish and purpose of every thoughtful American when I say that this sentence marks for us in the plainest manner the part we should play alike in the arrangement of our domestic affairs and in our exercise of influence upon the affairs of the world. By this faith, and by this faith alone, can the world be lifted out of its present confusion and despair. It was this faith which prevailed over the wicked force of Germany. You will remember that the beginning of the end of the war came when the German people found themselves face to face with the conscience of the world and realized that right was everywhere arrayed against the wrong that their government was attempting to perpetrate. I think, therefore, that it is true to say that this was the faith which won the war. Certainly this is the faith with which our gallant men went into the field and out upon the seas to make sure of victory. This is the mission upon which Democracy came into the world. Democracy is an assertion of the right of the individual to live and to be treated justly as against any attempt on the part of any combination of individuals to make laws which will overburden him or which will destroy his equality among his fellows in the matter of right or privilege; and I think we all realize that the day has come when Democracy is being put upon its final test. The Old World is just now suffering from a wanton rejection of the principle of democracy and a substitution of the principle of autocracy as asserted in the name, but without the authority and sanction, of the multitude. This is the time of all others when Democracy should prove its purity and its spiritual power to prevail. It is surely the manifest destiny of the United States to lead in the attempt to make this spirit prevail. There are two ways in which the United States can assist to accomplish this great object. First, by offering the example within her own borders of the will and power of Democracy to make and enforce laws which are unquestionably just and which are equal in their administration-laws which secure its full right to Labor and yet at the same time safeguard the integrity of property, and particularly of that property which is devoted to the development of industry and the increase of the necessary wealth of the world. Second, by standing for right and justice as toward individual nations. The law of Democracy is for the protection of the weak, and the influence of every democracy in the world should be for the protection of the weak nation, the nation which is struggling toward its right and toward its proper recognition and privilege in the family of nations. The United States cannot refuse this role of champion without putting the stigma of rejection upon the great and devoted men who brought its government into existence and established it in the face of almost universal opposition and intrigue, even in the face of wanton force, as, for example, against the Orders in Council of Great Britain and the arbitrary Napoleonic decrees which involved us in what we know as the War of 1812. I urge you to consider that the display of an immediate disposition on the part of the Congress to remedy any injustices or evils that may have shown themselves in our own national life will afford the most effectual offset to the forces of chaos and tyranny which are playing so disastrous a part in the fortunes of the free peoples of more than one part of the world. The United States is of necessity the sample democracy of the world, and the triumph of Democracy depends upon its success. Recovery from the disturbing and sometimes disastrous effects of the late war has been exceedingly slow on the other side of the water, and has given promise, I venture-to say, of early completion only in our own fortunate country; but even with us the recovery halts and is impeded at times, and there are immediately serviceable acts of legislation which it seems to me we ought to attempt, to assist that recovery and prove the indestructible recuperative force of a great government of the people. One of these is to prove that a great democracy can keep house as successfully and in as business-like a fashion as any other government. It seems to me that the first step toward providing this is to supply ourselves with a systematic method of handling our estimates and expenditures and bringing them to the point where they will not be an unnecessary strain upon our income or necessitate unreasonable taxation; in other words, a workable budget system. And I respectfully suggest that two elements are essential to such a system-namely, not only that the proposal of appropriations should be in the hands of a single body, such as a single appropriations committee in each house of the Congress, but also that this body should be brought into such cooperation with the Departments of the Government and with the Treasury of the United States as would enable it to act upon a complete conspectus of the needs of the Government and the resources from which it must draw its income. I reluctantly vetoed the budget bill passed by the last session of the Congress because of a constitutional objection. The House of Representatives subsequently modified the bill in order to meet this objection. In the revised form, I believe that the bill, coupled with action already taken by the Congress to revise its rules and procedure, furnishes the foundation for an effective national budget system. I earnestly hope, therefore, that one of the first steps to be taken by the present session of the Congress will be to pass the budget bill. The nation's finances have shown marked improvement during the last year. The total ordinary receipts of $6,694,000,000 for the fiscal year 1920 exceeded those for 1919 by $1,542,000,000, while the total net ordinary expenditures decreased from $18,514,000,000 to $6,403,000,000. The gross public debt, which reached its highest point on August 31, 1919, when it was $26,596,000,000, had dropped on November 30, 1920, to $24,175,000,000. There has also been a marked decrease in holdings of government war securities by the banking institutions of the country, as well as in the amount of bills held by the Federal Reserve Banks secured by government war obligations. This fortunate result has relieved the banks and left them freer to finance the needs of Agriculture, Industry, and Commerce. It has been due in large part to the reduction of the public debt, especially of the floating debt, but more particularly to the improved distribution of government securities among permanent investors. The cessation of the Government's borrowings, except through short-term certificates of indebtedness, has been a matter of great consequence to the people of the country at large, as well as to the holders of Liberty Bonds and Victory Notes, and has had an important bearing on the matter of effective credit control. The year has been characterized by the progressive withdrawal of the Treasury from the domestic credit market and from a position of dominant influence in that market. The future course will necessarily depend upon the extent to which economies are practiced and upon the burdens placed upon the Treasury, as well as upon industrial developments and the maintenance of tax receipts at a sufficiently high level. The fundamental fact which at present dominates the Government's financial situation is that seven and a half billions of its war indebtedness mature within the next two and a half years. Of this amount, two and a half billions are floating debt and five billions, Victory Notes and War. Savings Certificates. The fiscal program of the Government must be determined with reference to these maturities. Sound policy demands that Government expenditures be reduced to the lowest amount which will permit the various services to operate efficiently and that Government receipts from taxes and salvage be maintained sufficiently high to provide for current requirements, including interest and sinking fund charges on the public debt, and at the same time retire the floating debt and part of the Victory Loan before maturity. With rigid economy, vigorous salvage operations, and adequate revenues from taxation, a surplus of current receipts over current expenditures can be realized and should be applied to the floating debt. All branches of the Government should cooperate to see that this program is realized. I cannot overemphasize the necessity of economy in Government appropriations and expenditures and the avoidance by the Congress of practices which take money from the Treasury by indefinite or revolving fund appropriations. The estimates for the present year show that over a billion dollars of expenditures were authorized by the last Congress in addition to the amounts shown in the usual compiled statements of appropriations. This strikingly illustrates the importance of making direct and specific appropriations. The relation between the current receipts and current expenditures of the Government during the present fiscal year, as well as during the last half of the last fiscal year, has been disturbed by the extraordinary burdens thrown upon the Treasury by the Transportation Act, in connection with the return of the railroads to private control. Over $600,000,000 has already been paid to the railroads under this act-$350,000,000 during the present fiscal year; and it is estimated that further payments aggregating possibly $650,000,000 must still be made to the railroads during the current year. It is obvious that these large payments have already seriously limited the Government's progress in retiring the floating debt. Closely connected with this, it seems to me, is the necessity for an immediate consideration of the revision of our tax laws. Simplification of the income and profits taxes has become an immediate necessity. These taxes performed an indispensable service during the war. The need for their simplification, however, is very great, in order to save the taxpayer inconvenience and expense and in order to make his liability more certain and definite. Other and more detailed recommendations with regard to taxes will no doubt be laid before you by the Secretary of the Treasury and the Commissioner of Internal Revenue. It is my privilege to draw to the attention of Congress for very sympathetic consideration the problem of providing adequate facilities for the care and treatment of former members of the military and naval forces who are sick and disabled as the result of their participation in the war. These heroic men can never be paid in money for the service they patriotically rendered the nation. Their reward will lie rather in realization of the fact that they vindicated the rights of their country and aided in safeguarding civilization. The nation's gratitude must be effectively revealed to them by the most ample provision for their medical care and treatment as well as for their vocational training and placement. The time has come when a more complete program can be formulated and more satisfactorily administered for their treatment and training, and I earnestly urge that the Congress give the matter its early consideration. The Secretary of the Treasury and the Board for Vocational Education will outline in their annual reports proposals covering medical care and rehabilitation which I am sure will engage your earnest study and commend your most generous support. Permit me to emphasize once more the need for action upon certain matters upon which I dwelt at some length in my message to the second session of the Sixty-sixth Congress. The necessity, for example, of encouraging the manufacture of dyestuffs and related chemicals; the importance of doing everything possible to promote agricultural production along economic lines, to improve agricultural marketing, and to make rural life more attractive and healthful; the need for a law regulating cold storage in such a way as to limit the time during which goods may be kept in storage, prescribing the method of disposing of them if kept beyond the permitted period, and requiring goods released from storage in all cases to bear the date of their receipt. It would also be most serviceable if it were provided that all goods released from cold storage for interstate shipment should have plainly marked upon each package the selling or market price at which they went into storage, in order that the purchaser might be able to learn what profits stood between him and the producer or the wholesale dealer. Indeed, It would be very serviceable to the public if all goods destined for interstate commerce were made to carry upon every packing case whose form made it possible a plain statement of the price at which they left the hands of the producer. I respectfully call your attention also to the recommendations of the message referred to with regard to a federal license for all corporations engaged in interstate commerce. In brief, the immediate legislative need of the time is the removal of all obstacles to the realization of the best ambitions of our people in their several classes of employment and the strengthening of all instrumentalities by. which difficulties are to be met and removed and justice dealt out, whether by law or by some form of mediation and conciliation. I do not feel it to be my privilege at present to, suggest the detailed and particular methods by which these objects may be attained, but I have faith that the inquiries of your several committees will discover the way and the method. In response to what I believe to be the impulse of sympathy and opinion throughout the United States, I earnestly suggest that the Congress authorize the Treasury of the United States to make to the struggling government of Armenia such a loan as was made to several of the Allied governments during the war, and I would also suggest that it would be desirable to provide in the legislation itself that the expenditure of the money thus loaned should be under the supervision of a commission, or at least a commissioner, from the United States in order that revolutionary tendencies within Armenia itself might not be afforded by the loan a further tempting opportunity. Allow me to call your attention to the fact that the people of the Philippine Islands have succeeded in maintaining a stable government since the last action of the Congress in their behalf, and have thus fulfilled the condition set by the Congress as precedent to a consideration of granting independence to the Islands. I respectfully submit that this condition precedent having been fulfilled, it is now our liberty and our duty to keep our promise to the people of those islands by granting them the independence which they so honorably covet. I have not so much laid before you a series of recommendations, gentlemen, as sought to utter a confession of faith, of the faith in which I was bred and which it is my solemn purpose to stand by until my last fighting day. I believe this to be the faith of America, the faith of the future, and of all the victories which await national action in the days to come, whether in America or elsewhere.
GENTLEMEN OF THE CONGRESS: When I addressed myself to performing the duty laid upon the President by the Constitution to present to you an annual report on the state of the Union, I found my thought dominated by an immortal sentence of Abraham Lincoln's-"Let us have faith that right makes might, and in that faith let us dare to do our duty as we understand it" -a sentence immortal because it embodies in a form of utter simplicity and purity the essential faith of the nation, the faith in which it was conceived, and the faith in which it has grown to glory and power. With that faith and the birth of a nation founded upon it came the hope into the world that a new order would prevail throughout the affairs of mankind, an order in which reason and right would take precedence over covetousness and force; and I believe that I express the wish and purpose of every thoughtful American when I say that this sentence marks for us in the plainest manner the part we should play alike in the arrangement of our domestic affairs and in our exercise of influence upon the affairs of the world. By this faith, and by this faith alone, can the world be lifted out of its present confusion and despair. It was this faith which prevailed over the wicked force of Germany. You will remember that the beginning of the end of the war came when the German people found themselves face to face with the conscience of the world and realized that right was everywhere arrayed against the wrong that their government was attempting to perpetrate. I think, therefore, that it is true to say that this was the faith which won the war. Certainly this is the faith with which our gallant men went into the field and out upon the seas to make sure of victory. This is the mission upon which Democracy came into the world. Democracy is an assertion of the right of the individual to live and to be treated justly as against any attempt on the part of any combination of individuals to make laws which will overburden him or which will destroy his equality among his fellows in the matter of right or privilege; and I think we all realize that the day has come when Democracy is being put upon its final test. The Old World is just now suffering from a wanton rejection of the principle of democracy and a substitution of the principle of autocracy as asserted in the name, but without the authority and sanction, of the multitude. This is the time of all others when Democracy should prove its purity and its spiritual power to prevail. It is surely the manifest destiny of the United States to lead in the attempt to make this spirit prevail. There are two ways in which the United States can assist to accomplish this great object. First, by offering the example within her own borders of the will and power of Democracy to make and enforce laws which are unquestionably just and which are equal in their administration-laws which secure its full right to Labor and yet at the same time safeguard the integrity of property, and particularly of that property which is devoted to the development of industry and the increase of the necessary wealth of the world. Second, by standing for right and justice as toward individual nations. The law of Democracy is for the protection of the weak, and the influence of every democracy in the world should be for the protection of the weak nation, the nation which is struggling toward its right and toward its proper recognition and privilege in the family of nations. The United States cannot refuse this role of champion without putting the stigma of rejection upon the great and devoted men who brought its government into existence and established it in the face of almost universal opposition and intrigue, even in the face of wanton force, as, for example, against the Orders in Council of Great Britain and the arbitrary Napoleonic decrees which involved us in what we know as the War of 1812. I urge you to consider that the display of an immediate disposition on the part of the Congress to remedy any injustices or evils that may have shown themselves in our own national life will afford the most effectual offset to the forces of chaos and tyranny which are playing so disastrous a part in the fortunes of the free peoples of more than one part of the world. The United States is of necessity the sample democracy of the world, and the triumph of Democracy depends upon its success. Recovery from the disturbing and sometimes disastrous effects of the late war has been exceedingly slow on the other side of the water, and has given promise, I venture-to say, of early completion only in our own fortunate country; but even with us the recovery halts and is impeded at times, and there are immediately serviceable acts of legislation which it seems to me we ought to attempt, to assist that recovery and prove the indestructible recuperative force of a great government of the people. One of these is to prove that a great democracy can keep house as successfully and in as business-like a fashion as any other government. It seems to me that the first step toward providing this is to supply ourselves with a systematic method of handling our estimates and expenditures and bringing them to the point where they will not be an unnecessary strain upon our income or necessitate unreasonable taxation; in other words, a workable budget system. And I respectfully suggest that two elements are essential to such a system-namely, not only that the proposal of appropriations should be in the hands of a single body, such as a single appropriations committee in each house of the Congress, but also that this body should be brought into such cooperation with the Departments of the Government and with the Treasury of the United States as would enable it to act upon a complete conspectus of the needs of the Government and the resources from which it must draw its income. I reluctantly vetoed the budget bill passed by the last session of the Congress because of a constitutional objection. The House of Representatives subsequently modified the bill in order to meet this objection. In the revised form, I believe that the bill, coupled with action already taken by the Congress to revise its rules and procedure, furnishes the foundation for an effective national budget system. I earnestly hope, therefore, that one of the first steps to be taken by the present session of the Congress will be to pass the budget bill. The nation's finances have shown marked improvement during the last year. The total ordinary receipts of $6,694,000,000 for the fiscal year 1920 exceeded those for 1919 by $1,542,000,000, while the total net ordinary expenditures decreased from $18,514,000,000 to $6,403,000,000. The gross public debt, which reached its highest point on August 31, 1919, when it was $26,596,000,000, had dropped on November 30, 1920, to $24,175,000,000. There has also been a marked decrease in holdings of government war securities by the banking institutions of the country, as well as in the amount of bills held by the Federal Reserve Banks secured by government war obligations. This fortunate result has relieved the banks and left them freer to finance the needs of Agriculture, Industry, and Commerce. It has been due in large part to the reduction of the public debt, especially of the floating debt, but more particularly to the improved distribution of government securities among permanent investors. The cessation of the Government's borrowings, except through short-term certificates of indebtedness, has been a matter of great consequence to the people of the country at large, as well as to the holders of Liberty Bonds and Victory Notes, and has had an important bearing on the matter of effective credit control. The year has been characterized by the progressive withdrawal of the Treasury from the domestic credit market and from a position of dominant influence in that market. The future course will necessarily depend upon the extent to which economies are practiced and upon the burdens placed upon the Treasury, as well as upon industrial developments and the maintenance of tax receipts at a sufficiently high level. The fundamental fact which at present dominates the Government's financial situation is that seven and a half billions of its war indebtedness mature within the next two and a half years. Of this amount, two and a half billions are floating debt and five billions, Victory Notes and War. Savings Certificates. The fiscal program of the Government must be determined with reference to these maturities. Sound policy demands that Government expenditures be reduced to the lowest amount which will permit the various services to operate efficiently and that Government receipts from taxes and salvage be maintained sufficiently high to provide for current requirements, including interest and sinking fund charges on the public debt, and at the same time retire the floating debt and part of the Victory Loan before maturity. With rigid economy, vigorous salvage operations, and adequate revenues from taxation, a surplus of current receipts over current expenditures can be realized and should be applied to the floating debt. All branches of the Government should cooperate to see that this program is realized. I cannot overemphasize the necessity of economy in Government appropriations and expenditures and the avoidance by the Congress of practices which take money from the Treasury by indefinite or revolving fund appropriations. The estimates for the present year show that over a billion dollars of expenditures were authorized by the last Congress in addition to the amounts shown in the usual compiled statements of appropriations. This strikingly illustrates the importance of making direct and specific appropriations. The relation between the current receipts and current expenditures of the Government during the present fiscal year, as well as during the last half of the last fiscal year, has been disturbed by the extraordinary burdens thrown upon the Treasury by the Transportation Act, in connection with the return of the railroads to private control. Over $600,000,000 has already been paid to the railroads under this act-$350,000,000 during the present fiscal year; and it is estimated that further payments aggregating possibly $650,000,000 must still be made to the railroads during the current year. It is obvious that these large payments have already seriously limited the Government's progress in retiring the floating debt. Closely connected with this, it seems to me, is the necessity for an immediate consideration of the revision of our tax laws. Simplification of the income and profits taxes has become an immediate necessity. These taxes performed an indispensable service during the war. The need for their simplification, however, is very great, in order to save the taxpayer inconvenience and expense and in order to make his liability more certain and definite. Other and more detailed recommendations with regard to taxes will no doubt be laid before you by the Secretary of the Treasury and the Commissioner of Internal Revenue. It is my privilege to draw to the attention of Congress for very sympathetic consideration the problem of providing adequate facilities for the care and treatment of former members of the military and naval forces who are sick and disabled as the result of their participation in the war. These heroic men can never be paid in money for the service they patriotically rendered the nation. Their reward will lie rather in realization of the fact that they vindicated the rights of their country and aided in safeguarding civilization. The nation's gratitude must be effectively revealed to them by the most ample provision for their medical care and treatment as well as for their vocational training and placement. The time has come when a more complete program can be formulated and more satisfactorily administered for their treatment and training, and I earnestly urge that the Congress give the matter its early consideration. The Secretary of the Treasury and the Board for Vocational Education will outline in their annual reports proposals covering medical care and rehabilitation which I am sure will engage your earnest study and commend your most generous support. Permit me to emphasize once more the need for action upon certain matters upon which I dwelt at some length in my message to the second session of the Sixty-sixth Congress. The necessity, for example, of encouraging the manufacture of dyestuffs and related chemicals; the importance of doing everything possible to promote agricultural production along economic lines, to improve agricultural marketing, and to make rural life more attractive and healthful; the need for a law regulating cold storage in such a way as to limit the time during which goods may be kept in storage, prescribing the method of disposing of them if kept beyond the permitted period, and requiring goods released from storage in all cases to bear the date of their receipt. It would also be most serviceable if it were provided that all goods released from cold storage for interstate shipment should have plainly marked upon each package the selling or market price at which they went into storage, in order that the purchaser might be able to learn what profits stood between him and the producer or the wholesale dealer. Indeed, It would be very serviceable to the public if all goods destined for interstate commerce were made to carry upon every packing case whose form made it possible a plain statement of the price at which they left the hands of the producer. I respectfully call your attention also to the recommendations of the message referred to with regard to a federal license for all corporations engaged in interstate commerce. In brief, the immediate legislative need of the time is the removal of all obstacles to the realization of the best ambitions of our people in their several classes of employment and the strengthening of all instrumentalities by. which difficulties are to be met and removed and justice dealt out, whether by law or by some form of mediation and conciliation. I do not feel it to be my privilege at present to, suggest the detailed and particular methods by which these objects may be attained, but I have faith that the inquiries of your several committees will discover the way and the method. In response to what I believe to be the impulse of sympathy and opinion throughout the United States, I earnestly suggest that the Congress authorize the Treasury of the United States to make to the struggling government of Armenia such a loan as was made to several of the Allied governments during the war, and I would also suggest that it would be desirable to provide in the legislation itself that the expenditure of the money thus loaned should be under the supervision of a commission, or at least a commissioner, from the United States in order that revolutionary tendencies within Armenia itself might not be afforded by the loan a further tempting opportunity. Allow me to call your attention to the fact that the people of the Philippine Islands have succeeded in maintaining a stable government since the last action of the Congress in their behalf, and have thus fulfilled the condition set by the Congress as precedent to a consideration of granting independence to the Islands. I respectfully submit that this condition precedent having been fulfilled, it is now our liberty and our duty to keep our promise to the people of those islands by granting them the independence which they so honorably covet. I have not so much laid before you a series of recommendations, gentlemen, as sought to utter a confession of faith, of the faith in which I was bred and which it is my solemn purpose to stand by until my last fighting day. I believe this to be the faith of America, the faith of the future, and of all the victories which await national action in the days to come, whether in America or elsewhere.
gentlemen of the congress when i addressed myself to performing the duty laid upon the president by the constitution to present to you an annual report on the state of the union i found my thought dominated by an immortal sentence of abraham let us have faith that right makes might and in that faith let us dare to do our duty as we understand it sentence immortal because it embodies in a form of utter simplicity and purity the essential faith of the nation the faith in which it was conceived and the faith in which it has grown to glory and power with that faith and the birth of a nation founded upon it came the hope into the world that a new order would prevail throughout the affairs of mankind an order in which reason and right would take precedence over covetousness and force and i believe that i express the wish and purpose of every thoughtful american when i say that this sentence marks for us in the plainest manner the part we should play alike in the arrangement of our domestic affairs and in our exercise of influence upon the affairs of the world by this faith and by this faith alone can the world be lifted out of its present confusion and despair it was this faith which prevailed over the wicked force of germany you will remember that the beginning of the end of the war came when the german people found themselves face to face with the conscience of the world and realized that right was everywhere arrayed against the wrong that their government was attempting to perpetrate i think therefore that it is true to say that this was the faith which won the war certainly this is the faith with which our gallant men went into the field and out upon the seas to make sure of victory this is the mission upon which democracy came into the world democracy is an assertion of the right of the individual to live and to be treated justly as against any attempt on the part of any combination of individuals to make laws which will overburden him or which will destroy his equality among his fellows in the matter of right or privilege and i think we all realize that the day has come when democracy is being put upon its final test the old world is just now suffering from a wanton rejection of the principle of democracy and a substitution of the principle of autocracy as asserted in the name but without the authority and sanction of the multitude this is the time of all others when democracy should prove its purity and its spiritual power to prevail it is surely the manifest destiny of the united states to lead in the attempt to make this spirit prevail there are two ways in which the united states can assist to accomplish this great object first by offering the example within her own borders of the will and power of democracy to make and enforce laws which are unquestionably just and which are equal in their which secure its full right to labor and yet at the same time safeguard the integrity of property and particularly of that property which is devoted to the development of industry and the increase of the necessary wealth of the world second by standing for right and justice as toward individual nations the law of democracy is for the protection of the weak and the influence of every democracy in the world should be for the protection of the weak nation the nation which is struggling toward its right and toward its proper recognition and privilege in the family of nations the united states can not refuse this role of champion without putting the stigma of rejection upon the great and devoted men who brought its government into existence and established it in the face of almost universal opposition and intrigue even in the face of wanton force as for example against the orders in council of great britain and the arbitrary napoleonic decrees which involved us in what we know as the war of 1812 i urge you to consider that the display of an immediate disposition on the part of the congress to remedy any injustices or evils that may have shown themselves in our own national life will afford the most effectual offset to the forces of chaos and tyranny which are playing so disastrous a part in the fortunes of the free peoples of more than one part of the world the united states is of necessity the sample democracy of the world and the triumph of democracy depends upon its success recovery from the disturbing and sometimes disastrous effects of the late war has been exceedingly slow on the other side of the water and has given promise i say of early completion only in our own fortunate country but even with us the recovery halts and is impeded at times and there are immediately serviceable acts of legislation which it seems to me we ought to attempt to assist that recovery and prove the indestructible recuperative force of a great government of the people one of these is to prove that a great democracy can keep house as successfully and in as a fashion as any other government it seems to me that the first step toward providing this is to supply ourselves with a systematic method of handling our estimates and expenditures and bringing them to the point where they will not be an unnecessary strain upon our income or necessitate unreasonable taxation in other words a workable budget system and i respectfully suggest that two elements are essential to such a not only that the proposal of appropriations should be in the hands of a single body such as a single appropriations committee in each house of the congress but also that this body should be brought into such cooperation with the departments of the government and with the treasury of the united states as would enable it to act upon a complete conspectus of the needs of the government and the resources from which it must draw its income i reluctantly vetoed the budget bill passed by the last session of the congress because of a constitutional objection the house of representatives subsequently modified the bill in order to meet this objection in the revised form i believe that the bill coupled with action already taken by the congress to revise its rules and procedure furnishes the foundation for an effective national budget system i earnestly hope therefore that one of the first steps to be taken by the present session of the congress will be to pass the budget bill the nation finances have shown marked improvement during the last year the total ordinary receipts of for the fiscal year 1920 exceeded those for 1919 by while the total net ordinary expenditures decreased from to the gross public debt which reached its highest point on august 31 1919 when it was had dropped on november 30 1920 to there has also been a marked decrease in holdings of government war securities by the banking institutions of the country as well as in the amount of bills held by the federal reserve banks secured by government war obligations this fortunate result has relieved the banks and left them freer to finance the needs of agriculture industry and commerce it has been due in large part to the reduction of the public debt especially of the floating debt but more particularly to the improved distribution of government securities among permanent investors the cessation of the government borrowings except through certificates of indebtedness has been a matter of great consequence to the people of the country at large as well as to the holders of liberty bonds and victory notes and has had an important bearing on the matter of effective credit control the year has been characterized by the progressive withdrawal of the treasury from the domestic credit market and from a position of dominant influence in that market the future course will necessarily depend upon the extent to which economies are practiced and upon the burdens placed upon the treasury as well as upon industrial developments and the maintenance of tax receipts at a sufficiently high level the fundamental fact which at present dominates the government financial situation is that seven and a half billions of its war indebtedness mature within the next two and a half years of this amount two and a half billions are floating debt and five billions victory notes and war savings certificates the fiscal program of the government must be determined with reference to these maturities sound policy demands that government expenditures be reduced to the lowest amount which will permit the various services to operate efficiently and that government receipts from taxes and salvage be maintained sufficiently high to provide for current requirements including interest and sinking fund charges on the public debt and at the same time retire the floating debt and part of the victory loan before maturity with rigid economy vigorous salvage operations and adequate revenues from taxation a surplus of current receipts over current expenditures can be realized and should be applied to the floating debt all branches of the government should cooperate to see that this program is realized i can not overemphasize the necessity of economy in government appropriations and expenditures and the avoidance by the congress of practices which take money from the treasury by indefinite or revolving fund appropriations the estimates for the present year show that over a billion dollars of expenditures were authorized by the last congress in addition to the amounts shown in the usual compiled statements of appropriations this strikingly illustrates the importance of making direct and specific appropriations the relation between the current receipts and current expenditures of the government during the present fiscal year as well as during the last half of the last fiscal year has been disturbed by the extraordinary burdens thrown upon the treasury by the transportation act in connection with the return of the railroads to private control over has already been paid to the railroads under this during the present fiscal year and it is estimated that further payments aggregating possibly must still be made to the railroads during the current year it is obvious that these large payments have already seriously limited the government progress in retiring the floating debt closely connected with this it seems to me is the necessity for an immediate consideration of the revision of our tax laws simplification of the income and profits taxes has become an immediate necessity these taxes performed an indispensable service during the war the need for their simplification however is very great in order to save the taxpayer inconvenience and expense and in order to make his liability more certain and definite other and more detailed recommendations with regard to taxes will no doubt be laid before you by the secretary of the treasury and the commissioner of internal revenue it is my privilege to draw to the attention of congress for very sympathetic consideration the problem of providing adequate facilities for the care and treatment of former members of the military and naval forces who are sick and disabled as the result of their participation in the war these heroic men can never be paid in money for the service they patriotically rendered the nation their reward will lie rather in realization of the fact that they vindicated the rights of their country and aided in safeguarding civilization the nation gratitude must be effectively revealed to them by the most ample provision for their medical care and treatment as well as for their vocational training and placement the time has come when a more complete program can be formulated and more satisfactorily administered for their treatment and training and i earnestly urge that the congress give the matter its early consideration the secretary of the treasury and the board for vocational education will outline in their annual reports proposals covering medical care and rehabilitation which i am sure will engage your earnest study and commend your most generous support permit me to emphasize once more the need for action upon certain matters upon which i dwelt at some length in my message to the second session of the congress the necessity for example of encouraging the manufacture of dyestuffs and related chemicals the importance of doing everything possible to promote agricultural production along economic lines to improve agricultural marketing and to make rural life more attractive and healthful the need for a law regulating cold storage in such a way as to limit the time during which goods may be kept in storage prescribing the method of disposing of them if kept beyond the permitted period and requiring goods released from storage in all cases to bear the date of their receipt it would also be most serviceable if it were provided that all goods released from cold storage for interstate shipment should have plainly marked upon each package the selling or market price at which they went into storage in order that the purchaser might be able to learn what profits stood between him and the producer or the wholesale dealer indeed it would be very serviceable to the public if all goods destined for interstate commerce were made to carry upon every packing case whose form made it possible a plain statement of the price at which they left the hands of the producer i respectfully call your attention also to the recommendations of the message referred to with regard to a federal license for all corporations engaged in interstate commerce in brief the immediate legislative need of the time is the removal of all obstacles to the realization of the best ambitions of our people in their several classes of employment and the strengthening of all instrumentalities by which difficulties are to be met and removed and justice dealt out whether by law or by some form of mediation and conciliation i do not feel it to be my privilege at present to suggest the detailed and particular methods by which these objects may be attained but i have faith that the inquiries of your several committees will discover the way and the method in response to what i believe to be the impulse of sympathy and opinion throughout the united states i earnestly suggest that the congress authorize the treasury of the united states to make to the struggling government of armenia such a loan as was made to several of the allied governments during the war and i would also suggest that it would be desirable to provide in the legislation itself that the expenditure of the money thus loaned should be under the supervision of a commission or at least a commissioner from the united states in order that revolutionary tendencies within armenia itself might not be afforded by the loan a further tempting opportunity allow me to call your attention to the fact that the people of the philippine islands have succeeded in maintaining a stable government since the last action of the congress in their behalf and have thus fulfilled the condition set by the congress as precedent to a consideration of granting independence to the islands i respectfully submit that this condition precedent having been fulfilled it is now our liberty and our duty to keep our promise to the people of those islands by granting them the independence which they so honorably covet i have not so much laid before you a series of recommendations gentlemen as sought to utter a confession of faith of the faith in which i was bred and which it is my solemn purpose to stand by until my last fighting day i believe this to be the faith of america the faith of the future and of all the victories which await national action in the days to come whether in america or elsewhere
gentlemen congress addressed performing duty laid upon president constitution present annual report state union found thought dominated immortal sentence abraham let us faith right makes might faith let us dare duty understand sentence immortal embodies form utter simplicity purity essential faith nation faith conceived faith grown glory power faith birth nation founded upon came hope world new order would prevail throughout affairs mankind order reason right would take precedence covetousness force believe express wish purpose every thoughtful american say sentence marks us plainest manner part play alike arrangement domestic affairs exercise influence upon affairs world faith faith alone world lifted present confusion despair faith prevailed wicked force germany remember beginning end war came german people found face face conscience world realized right everywhere arrayed wrong government attempting perpetrate think therefore true say faith war certainly faith gallant men went field upon seas make sure victory mission upon democracy came world democracy assertion right individual live treated justly attempt part combination individuals make laws overburden destroy equality among fellows matter right privilege think realize day come democracy put upon final test old world suffering wanton rejection principle democracy substitution principle autocracy asserted name without authority sanction multitude time others democracy prove purity spiritual power prevail surely manifest destiny united states lead attempt make spirit prevail two ways united states assist accomplish great object first offering example within borders power democracy make enforce laws unquestionably equal secure full right labor yet time safeguard integrity property particularly property devoted development industry increase necessary wealth world second standing right justice toward individual nations law democracy protection weak influence every democracy world protection weak nation nation struggling toward right toward proper recognition privilege family nations united states refuse role champion without putting stigma rejection upon great devoted men brought government existence established face almost universal opposition intrigue even face wanton force example orders council great britain arbitrary napoleonic decrees involved us know war 1812 urge consider display immediate disposition part congress remedy injustices evils may shown national life afford effectual offset forces chaos tyranny playing disastrous part fortunes free peoples one part world united states necessity sample democracy world triumph democracy depends upon success recovery disturbing sometimes disastrous effects late war exceedingly slow side water given promise say early completion fortunate country even us recovery halts impeded times immediately serviceable acts legislation seems ought attempt assist recovery prove indestructible recuperative force great government people one prove great democracy keep house successfully fashion government seems first step toward providing supply systematic method handling estimates expenditures bringing point unnecessary strain upon income necessitate unreasonable taxation words workable budget system respectfully suggest two elements essential proposal appropriations hands single body single appropriations committee house congress also body brought cooperation departments government treasury united states would enable act upon complete conspectus needs government resources must draw income reluctantly vetoed budget bill passed last session congress constitutional objection house representatives subsequently modified bill order meet objection revised form believe bill coupled action already taken congress revise rules procedure furnishes foundation effective national budget system earnestly hope therefore one first steps taken present session congress pass budget bill nation finances shown marked improvement last year total ordinary receipts fiscal year 1920 exceeded 1919 total net ordinary expenditures decreased gross public debt reached highest point august 31 1919 dropped november 30 1920 also marked decrease holdings government war securities banking institutions country well amount bills held federal reserve banks secured government war obligations fortunate result relieved banks left freer finance needs agriculture industry commerce due large part reduction public debt especially floating debt particularly improved distribution government securities among permanent investors cessation government borrowings except certificates indebtedness matter great consequence people country large well holders liberty bonds victory notes important bearing matter effective credit control year characterized progressive withdrawal treasury domestic credit market position dominant influence market future course necessarily depend upon extent economies practiced upon burdens placed upon treasury well upon industrial developments maintenance tax receipts sufficiently high level fundamental fact present dominates government financial situation seven half billions war indebtedness mature within next two half years amount two half billions floating debt five billions victory notes war savings certificates fiscal program government must determined reference maturities sound policy demands government expenditures reduced lowest amount permit various services operate efficiently government receipts taxes salvage maintained sufficiently high provide current requirements including interest sinking fund charges public debt time retire floating debt part victory loan maturity rigid economy vigorous salvage operations adequate revenues taxation surplus current receipts current expenditures realized applied floating debt branches government cooperate see program realized overemphasize necessity economy government appropriations expenditures avoidance congress practices take money treasury indefinite revolving fund appropriations estimates present year show billion dollars expenditures authorized last congress addition amounts shown usual compiled statements appropriations strikingly illustrates importance making direct specific appropriations relation current receipts current expenditures government present fiscal year well last half last fiscal year disturbed extraordinary burdens thrown upon treasury transportation act connection return railroads private control already paid railroads present fiscal year estimated payments aggregating possibly must still made railroads current year obvious large payments already seriously limited government progress retiring floating debt closely connected seems necessity immediate consideration revision tax laws simplification income profits taxes become immediate necessity taxes performed indispensable service war need simplification however great order save taxpayer inconvenience expense order make liability certain definite detailed recommendations regard taxes doubt laid secretary treasury commissioner internal revenue privilege draw attention congress sympathetic consideration problem providing adequate facilities care treatment former members military naval forces sick disabled result participation war heroic men never paid money service patriotically rendered nation reward lie rather realization fact vindicated rights country aided safeguarding civilization nation gratitude must effectively revealed ample provision medical care treatment well vocational training placement time come complete program formulated satisfactorily administered treatment training earnestly urge congress give matter early consideration secretary treasury board vocational education outline annual reports proposals covering medical care rehabilitation sure engage earnest study commend generous support permit emphasize need action upon certain matters upon dwelt length message second session congress necessity example encouraging manufacture dyestuffs related chemicals importance everything possible promote agricultural production along economic lines improve agricultural marketing make rural life attractive healthful need law regulating cold storage way limit time goods may kept storage prescribing method disposing kept beyond permitted period requiring goods released storage cases bear date receipt would also serviceable provided goods released cold storage interstate shipment plainly marked upon package selling market price went storage order purchaser might able learn profits stood producer wholesale dealer indeed would serviceable public goods destined interstate commerce made carry upon every packing case whose form made possible plain statement price left hands producer respectfully call attention also recommendations message referred regard federal license corporations engaged interstate commerce brief immediate legislative need time removal obstacles realization best ambitions people several classes employment strengthening instrumentalities difficulties met removed justice dealt whether law form mediation conciliation feel privilege present suggest detailed particular methods objects may attained faith inquiries several committees discover way method response believe impulse sympathy opinion throughout united states earnestly suggest congress authorize treasury united states make struggling government armenia loan made several allied governments war would also suggest would desirable provide legislation expenditure money thus loaned supervision commission least commissioner united states order revolutionary tendencies within armenia might afforded loan tempting opportunity allow call attention fact people philippine islands succeeded maintaining stable government since last action congress behalf thus fulfilled condition set congress precedent consideration granting independence islands respectfully submit condition precedent fulfilled liberty duty keep promise people islands granting independence honorably covet much laid series recommendations gentlemen sought utter confession faith faith bred solemn purpose stand last fighting day believe faith america faith future victories await national action days come whether america elsewhere
gentleman congress address perform duty lay upon president constitution present annual report state union find thought dominate immortal sentence abraham let u faith right make might faith let u dare duty understand sentence immortal embodies form utter simplicity purity essential faith nation faith conceive faith grown glory power faith birth nation found upon come hope world new order would prevail throughout affair mankind order reason right would take precedence covetousness force believe express wish purpose every thoughtful american say sentence mark u plain manner part play alike arrangement domestic affair exercise influence upon affair world faith faith alone world lift present confusion despair faith prevail wicked force germany remember begin end war come german people find face face conscience world realize right everywhere array wrong government attempt perpetrate think therefore true say faith war certainly faith gallant men go field upon sea make sure victory mission upon democracy come world democracy assertion right individual live treat justly attempt part combination individual make law overburden destroy equality among fellow matter right privilege think realize day come democracy put upon final test old world suffer wanton rejection principle democracy substitution principle autocracy assert name without authority sanction multitude time others democracy prove purity spiritual power prevail surely manifest destiny united state lead attempt make spirit prevail two way united state assist accomplish great object first offering example within border power democracy make enforce law unquestionably equal secure full right labor yet time safeguard integrity property particularly property devote development industry increase necessary wealth world second stand right justice toward individual nation law democracy protection weak influence every democracy world protection weak nation nation struggle toward right toward proper recognition privilege family nation united state refuse role champion without put stigma rejection upon great devote men bring government existence establish face almost universal opposition intrigue even face wanton force example order council great britain arbitrary napoleonic decree involve u know war 1812 urge consider display immediate disposition part congress remedy injustice evils may show national life afford effectual offset force chaos tyranny play disastrous part fortune free people one part world united state necessity sample democracy world triumph democracy depend upon success recovery disturb sometimes disastrous effect late war exceedingly slow side water give promise say early completion fortunate country even u recovery halt impede time immediately serviceable act legislation seem ought attempt assist recovery prove indestructible recuperative force great government people one prove great democracy keep house successfully fashion government seem first step toward provide supply systematic method handle estimate expenditure bring point unnecessary strain upon income necessitate unreasonable taxation word workable budget system respectfully suggest two element essential proposal appropriation hand single body single appropriation committee house congress also body bring cooperation department government treasury united state would enable act upon complete conspectus need government resource must draw income reluctantly veto budget bill pass last session congress constitutional objection house representative subsequently modify bill order meet objection revise form believe bill couple action already take congress revise rule procedure furnishes foundation effective national budget system earnestly hope therefore one first step take present session congress pas budget bill nation finance show marked improvement last year total ordinary receipt fiscal year 1920 exceed 1919 total net ordinary expenditure decrease gross public debt reach high point august 31 1919 drop november 30 1920 also mark decrease holding government war security banking institution country well amount bill hold federal reserve bank secure government war obligation fortunate result relieved bank leave free finance need agriculture industry commerce due large part reduction public debt especially floating debt particularly improve distribution government security among permanent investor cessation government borrowing except certificate indebtedness matter great consequence people country large well holder liberty bond victory note important bearing matter effective credit control year characterize progressive withdrawal treasury domestic credit market position dominant influence market future course necessarily depend upon extent economy practice upon burden place upon treasury well upon industrial development maintenance tax receipt sufficiently high level fundamental fact present dominates government financial situation seven half billion war indebtedness mature within next two half year amount two half billion float debt five billion victory note war saving certificate fiscal program government must determine reference maturity sound policy demand government expenditure reduce low amount permit various service operate efficiently government receipt tax salvage maintain sufficiently high provide current requirement include interest sinking fund charge public debt time retire float debt part victory loan maturity rigid economy vigorous salvage operation adequate revenue taxation surplus current receipt current expenditure realize applied float debt branch government cooperate see program realize overemphasize necessity economy government appropriation expenditures avoidance congress practice take money treasury indefinite revolve fund appropriation estimate present year show billion dollar expenditures authorize last congress addition amount show usual compile statement appropriation strikingly illustrate importance make direct specific appropriation relation current receipt current expenditure government present fiscal year well last half last fiscal year disturb extraordinary burden throw upon treasury transportation act connection return railroad private control already pay railroad present fiscal year estimate payment aggregate possibly must still make railroad current year obvious large payment already seriously limited government progress retire float debt closely connect seem necessity immediate consideration revision tax law simplification income profit tax become immediate necessity tax perform indispensable service war need simplification however great order save taxpayer inconvenience expense order make liability certain definite detailed recommendation regard tax doubt lay secretary treasury commissioner internal revenue privilege draw attention congress sympathetic consideration problem provide adequate facility care treatment former member military naval force sick disabled result participation war heroic men never pay money service patriotically render nation reward lie rather realization fact vindicate right country aid safeguard civilization nation gratitude must effectively reveal ample provision medical care treatment well vocational train placement time come complete program formulate satisfactorily administer treatment train earnestly urge congress give matter early consideration secretary treasury board vocational education outline annual report proposal cover medical care rehabilitation sure engage earnest study commend generous support permit emphasize need action upon certain matter upon dwelt length message second session congress necessity example encouraging manufacture dyestuff related chemical importance everything possible promote agricultural production along economic line improve agricultural marketing make rural life attractive healthful need law regulate cold storage way limit time good may keep storage prescribe method dispose keep beyond permitted period require good release storage case bear date receipt would also serviceable provided good release cold storage interstate shipment plainly mark upon package sell market price go storage order purchaser might able learn profit stand producer wholesale dealer indeed would serviceable public good destine interstate commerce make carry upon every packing case whose form make possible plain statement price leave hand producer respectfully call attention also recommendations message refer regard federal license corporation engage interstate commerce brief immediate legislative need time removal obstacle realization best ambition people several class employment strengthen instrumentality difficulty meet removed justice deal whether law form mediation conciliation feel privilege present suggest detail particular method object may attain faith inquiry several committee discover way method response believe impulse sympathy opinion throughout united state earnestly suggest congress authorize treasury united state make struggle government armenia loan make several allied government war would also suggest would desirable provide legislation expenditure money thus loan supervision commission least commissioner united state order revolutionary tendency within armenia might afford loan tempt opportunity allow call attention fact people philippine island succeed maintain stable government since last action congress behalf thus fulfilled condition set congress precedent consideration grant independence island respectfully submit condition precedent fulfil liberty duty keep promise people islands grant independence honorably covet much laid series recommendation gentleman seek utter confession faith faith breed solemn purpose stand last fighting day believe faith america faith future victory await national action day come whether america elsewhere