Our depressed commerce is a subject to which I called your special attention at the last session, and suggested that we will in the future have to look more to the countries south of us, and to China and Japan, for its revival.  Our representatives to all these Governments have exerted their influence to encourage trade between the United States and the countries to which they are accredited.  But the fact exists that the carrying is done almost entirely in foreign bottoms, and while this state of affairs exists we can not control our due share of the commerce of the world; that between the Pacific States and China and Japan is about all the carrying trade now conducted in American vessels.  I would recommend a liberal policy toward that line of American steamers—­one that will insure its success, and even increased usefulness.

The cost of building iron vessels, the only ones that can compete with foreign ships in the carrying trade, is so much greater in the United States than in foreign countries that without some assistance from the Government they can not be successfully built here.  There will be several propositions laid before Congress in the course of the present session looking to a remedy for this evil.  Even if it should be at some cost to the National Treasury, I hope such encouragement will be given as will secure American shipping on the high seas and American shipbuilding at home.

The condition of the archives at the Department of State calls for the early action of Congress.  The building now rented by that Department is a frail structure, at an inconvenient distance from the Executive Mansion and from the other Departments, is ill adapted to the purpose for which it is used, has not capacity to accommodate the archives, and is not fireproof.  Its remote situation, its slender construction, and the absence of a supply of water in the neighborhood leave but little hope of safety for either the building or its contents in case of the accident of a fire.  Its destruction would involve the loss of the rolls containing the original acts and resolutions of Congress, of the historic records of the Revolution and of the Confederation, of the whole series of diplomatic and consular archives since the adoption of the Constitution, and of the many other valuable records and papers left with that Department when it was the principal depository of the governmental archives.  I recommend an appropriation for the construction of a building for the Department of State.

I recommend to your consideration the propriety of transferring to the Department of the Interior, to which they seem more appropriately to belong, all powers and duties in relation to the Territories with which the Department of State is now charged by law or usage; and from the Interior Department to the War Department the Pension Bureau, so far as it regulates the payment of soldiers’ pensions.  I would further recommend that the payment of naval pensions be transferred to one of the bureaus of the Navy Department.