probably be necessary to give it the clerical and administrative machinery with which to do serviceable work.

What is more important is, that the industries and resources of the country should be available and ready for mobilization. It is the more imperatively necessary, therefore, that we should promptly devise means for doing what we have not yet done: that we should give intelligent federal aid and stimulation to industrial and vocational education, as we have long done in the large field of our agricultural industry; that, at the same time that we safeguard and conserve the natural resources of the country we should put them at the disposal of those who will use them promptly and intelligently, as was sought to be done in the admirable bills submitted to the last Congress from its committees on the public lands, bills which I earnestly recommend in principle to your consideration; that we should put into early operation some provision for rural credits which will add to the extensive borrowing facilities already afforded the farmer by the Reserve Bank Act, adequate instrumentalities by which long credits may be obtained on land mortgages; and that we should study more carefully than they have hitherto been studied. the right adaptation of our economic arrangements to changing conditions.

Many conditions about which we have repeatedly legislated are being altered from decade to decade, it is evident, under our very eyes, and are likely to change even more rapidly and more radically in the days immediately ahead of us, when peace has returned to the world and the nations of Europe once more take up their tasks of commerce and industry with the energy of those who must bestir themselves to build anew. Just what these changes will be no one can certainly foresee or confidently predict. There are no calculable, because no stable, elements in the problem. The most we can do is to make certain that we have the necessary instrumentalities of information constantly at our service so that we may be sure that we know exactly what we are dealing with when we come to act, if it should be necessary to act at all. We must first certainly know what it is that we are seeking to adapt ourselves to. I may ask the privilege of addressing you more at length on this important matter a little later in your session.

In the meantime may I make this suggestion? The transportation problem is an exceedingly serious and pressing one in this country. There has from time to time of late been reason to fear that our railroads would not much longer be able to cope with it successfully, as at present equipped and coördinated. I suggest that it would be wise to provide for a commission of inquiry to ascertain by a thorough canvass of the whole question whether our laws as at

present framed and administered are as serviceable as they might be in the solution of the problem. It is obviously a problem that lies at the very foundation of our efficiency as a people. Such an inquiry ought to draw out every circumstance and opinion worth considering and we need to know all sides of the matter if we mean to do anything in the field of federal legislation.

No one, I am sure, would wish to take any backward step. The regulation of the railways of the country by federal commission has had admirable results and has fully justified the hopes and expectations of those by whom the policy of regulation was originally proposed. The question is not what should we undo? It is, whether there is anything else we can do that would supply us with effective. means, in the very process of regulation, for bettering the conditions. under which the railroads are operated and for making them more useful servants of the country as a whole. It seems to me that it might be the part of wisdom, therefore, before further legislation in this field is attempted, to look at the whole problem of coördination and efficiency in the full light of a fresh assessment of circumstance and opinion, as a guide to dealing with the several parts of it.

For what we are seeking now, what in my mind is the single thought of this message, is national efficiency and security. We serve a great nation. We should serve it in the spirit of its peculiar genius. It is the genius of common men for self-government, industry, justice, liberty and peace. We should see to it that it lacks no instrument, no facility or vigor of law, to make it sufficient to play its part with energy, safety, and assured success. In this we are no partisans but heralds and prophets of a new age.

PRESIDENT WILSON'S NOTE TO AUSTRIA ON THE ANCONA

SINKING

DEPARTMENT OF STATE, Washington, Dec. 6, 1915.

The Secretary of State to Ambassador Penfield:

Please deliver a note to the Minister of Foreign Affairs, textually as follows: Reliable information obtained from American and other survivors who were passengers on the steamship Ancona shows that on Nov. 7 a submarine flying the Austro-Hungarian flag fired a solid shot toward the steamship, that thereupon the Ancona attempted to escape, but, being overhauled by the submarine, she stopped, that after a brief period and before the crew and passengers were all able to take to the boats the submarine fired a number of shells at the vessel and finally torpedoed and sank her while there were yet many persons on board, and that by gunfire and foundering of the vessel a large number of persons lost their lives or were seriously injured, among whom were citizens of the United States.

The public statement of the Austro-Hungarian Admiralty has been brought to the attention of the Government of the United States and received careful consideration. This statement substantially confirms the principal declaration

of the survivors, as it admits that the Ancona, after being shelled, was torpedoed and sunk while persons were still on board.

The Austro-Hungarian Government has been advised, through the correspondence which has passed between the United States and Germany, of the attitude of the Government of the United States as to the use of submarines in attacking vessels of commerce, and the acquiescence of Germany in that attitude, yet with full knowledge on the part of the Austro-Hungarian Government of the views of the Government of the United States as expressed in no uncertain terms to the ally of Austria-Hungary, the commander of the submarine which attacked the Ancona failed to put in a place of safety the crew and passengers of the vessel which they purposed to destroy because, it is presumed, of the impossibility of taking it into port as a prize of war.

The Government of the United States considers that the commander violated the principles of international law and of humanity by shelling and torpedoing the Ancona before the persons on board had been put in a place of safety or even given sufficient time to leave the vessel. The conduct of the commander can only be characterized as wanton slaughter of defenseless noncombatants, since at the time when the vessel was shelled and torpedoed she was not, it appears, resisting or attempting to escape, and no other reason is sufficient to excuse such an attack, not even the possibility of rescue.

The Government of the United States is forced, therefore, to conclude either that the commander of the submarine acted in violation of his instructions or that the Imperial and Royal Government failed to issue instructions to the commanders of its submarines in accordance with the law of nations and the principles of humanity. The Government of the United States is unwilling to believe the latter alternative and to credit the Austro-Hungarian Government with an intention to permit its submarines to destroy the lives of helpless men, women and children. It prefers to believe that the commander of the submarine committed this outrage without authority and contrary to the general or special instructions which he had received.

As the good relations of the two countries must rest upon a common regard for law and humanity, the Government of the United States cannot be expected to do otherwise than to demand that the Imperial and Royal Government denounce the sinking of the Ancona as an illegal and indefensible act; that the officer who perpetrated the deed be punished, and that reparation by the payment of an indemnity be made for the citizens of the United States who were killed or injured by the attack on the vessel.

The Government of the United States expects that the Austro-Hungarian Government, appreciating the gravity of the case, will accede to its demand promptly, and it rests this expectation on the belief that the Austro-Hungarian Government will not sanction or defend an act which is condemned by the world as inhumane and barbarous, which is abhorrent to all civilized nations, and which has caused the death of innocent American citizens.

LANSING.

TEXT OF AUSTRIA'S REPLY TO FIRST ANCONA NOTE, ACCEDING TO NO DEMANDS AND INVITING DISCUSSION

Secretary of State, Washington:

AMERICAN EMBASSY, VIENNA, Dec. 15, 1915.

Following note received from Minister for Foreign Affairs noon today: In reply to the much esteemed note, No. 4,167, which his Excellency Mr. Frederic Courtland Penfield, Ambassador Extraordinary and Plenipotentiary of the United States of America, directed to him in the name of the American Government under date of the 9th inst., and in the matter of the sinking of the Italian steamer Ancona, the undersigned, preliminary to a thorough, meritorious treatment of the demand, has the honor to observe that the sharpness with

which the Government of the United States considers it necessary to blame the commanding officer of the submarine concerned in the affair, and the firmness in which the demands addressed to the Imperial and Royal Government appear to be expressed, might well have warranted the expectation that the Government of the United States should precisely specify the actual circumstances of the affair upon which it bases its case.

As is not difficult to perceive, the presentation of the facts in the case in the aforesaid note leaves room for many doubts, and even if this presentation were correct in all points and the most rigorous legal conception were applied to the judgment of the case, it does not in any way sufficiently warrant attaching blame to the commanding officer of the war vessel or to the Imperial and Royal Government.

The Government of the United States has also failed to designate the persons upon whose testimony it relies and to whom it apparently believes it may attribute a higher degree of credibility than to the commander of the Imperial and Royal Fleet. The note also fails to give any information whatsoever as to the number, names, and more precise fate of the American citizens who were on board of the said steamer at the critical moment.

Moreover, in view of the fact that the Washington Cabinet has now made a positive statement to the effect that citizens of the United States of America came to grief in the incident in question, the Imperial and Royal Government is in principle ready to enter into an exchange of views in the affair with the Government of the United States. It must, however, in the first place, raise the question why that Government failed to give juridical reasons for the demands set forth in its note with reference to the special circumstances of the incriminating events upon which it itself lays stress, and why in lieu thereof it referred to an exchange of correspondence which it has conducted with another Government in other cases.

The Imperial and Royal Government is the less able to follow the Washington Cabinet in this unusual path, since it by no means possesses authentic knowledge of all of the pertinent correspondence of the Government of the United States, nor is it of the opinion that such knowledge might be sufficient for it in the present case, which, in so far as it is informed, is in essential points of another nature than the case or cases to which the Government of the United States seems to allude. The Imperial and Royal Government may, therefore, leave it to the Washington Cabinet to formulate the particular points of law against which the commanding officer of the submarine is alleged to have offended on the occasion of the sinking of the Ancona.

The Government of the United States has also seen fit to refer to the attitude which the Berlin Cabinet assumed in the above mentioned correspondence. The Imperial and Royal Government finds in the much esteemed note no indication whatever of the intent with which this reference was made. Should, however, the Government of the United States thereby have intended to express an opinion to the effect that a prejudice of whatever nature existed for the Imperial and Royal Government with respect to the juridical consideration of the affair in question, this Government must, in order to preclude possible misunderstandings, declare that, as a matter of course, it reserves to itself full freedom of maintaining its own legal views in the discussion of the case of the Ancona.

In having the honor to have recourse to the kindness of his Excellency the Ambassador of the United States of America with the most respectful request to be good enough to communicate the foregoing to the American Government, and on this occasion to state that the Imperial and Royal Government, in no less degree than the American Government, and under all circumstances, most sincerely deplores the fate of the innocent victims of the incident in question, the undersigned at the same time avails himself of this opportunity to renew the expression of his most distinguished consideration to his Excellency the Ambassador. (Signed) BURIAN.

PENFIELD.

TEXT OF THE SECOND ANCONA NOTE TO AUSTRIA, REITERATING OUR DEMANDS AND DECLINING DISCUSSION

Department of STATE, WASHINGTON, DEC. 19, 1915.

The Secretary of State to Ambassador Penfield:

You are instructed to address a note to the Austro-Hungarian Minister of Foreign Affairs, textually as follows:

The Government of the United States has received the note of Your Excellency relative to the sinking of the Ancona, which was delivered at Vienna on Dec. 15, 1915, and transmitted to Washington, and has given the note immediate and careful consideration.

On Nov. 15, 1915, Baron Zwiedenek, the Chargé d'Affaires of the Imperial and Royal Government at Washington, transmitted to the Department of State a report of the Austro-Hungarian Admiralty with regard to the sinking of the steamship Ancona, in which it was admitted that the vessel was torpedoed after her engines had been stopped and when passengers were still on board.

This admission alone is, in the view of the Government of the United States, sufficient to fix upon the commander of the submarine which fired the torpedo the responsibility for having wilfully violated the recognized law of nations and entirely disregarded those humane principles which every belligerent should observe in the conduct of war at sea.

In view of these admitted circumstances the Government of the United States feels justified in holding that the details of the sinking of the Ancona, the weight and character of the additional testimony corroborating the Admiralty's report, and the number of Americans killed or injured are in no way essential matters of discussion. The culpability of the commander is in any case established, and the undisputed fact is that citizens of the United States were killed, injured, or put in jeopardy by his lawless act.

The rules of international law and the principles of humanity which were thus wilfully violated by the commander of the submarine have been so long and so universally recognized and are so manifest from the standpoint of right and justice that the Government of the United States does not feel called upon to debate them and does not understand that the Imperial and Royal Government questions or disputes them.

The Government of the United States therefore finds no other course open to it but to hold the Imperial and Royal Government responsible for the act of its naval commander and to renew the definite but respectful demands made in its communication of the 6th of December, 1915.

It sincerely hopes that the foregoing statement of its position will enable the Imperial and Royal Government to perceive the justice of those demands and to comply with them in the same spirit of frankness and with the same concern for the good relations now existing between the United States and Austria-Hungary which prompted the Government of the United States to make them.

Reply to Bennet Resolution

LANSING.

After the reading of President Wilson's Third Annual Address, Congressman Bennet of New York introduced and the House passed a resolution asking the President to advise to whom he referred when he said certain citizens born under other flags "had poured the poison of disloyalty into the very arteries of our national life" and had been guilty of attempts to destroy American industry. (Page 8114.)

The President's reply, made public through Chairman Webb of the House Judiciary Committee, was:

I know that you will believe that it goes without saying that I would be delighted to co-operate in any way in attaining the objects which are no doubt sought by the inclosed resolutions which you were kind enough to send me, but I believe it would seriously interfere with the ends of justice if I were at this time to comply with the specific request contained in this suggested action of the House.

I am sure the Department of Justice will be more than willing to put at your disposal any facts whatever that are in its possession which do not block its own processes or embarrass it in its investigation of the intricate and hidden influences.