to the happiness of its people,
is the security and neutrality of the interoceanic routes which lead
through it."

The construction of three transcontinental lines of railway, all in
successful operation, wholly within our territory, and uniting the
Atlantic and the Pacific oceans, has been accompanied by results of a
most interesting and impressive nature, and has created new conditions,
not in the routes of commerce only, but in political geography, which
powerfully affect our relations toward and necessarily increase our
interests in any transisthmian route which may be opened and employed
for the ends of peace and traffic, or, in other contingencies, for uses
inimical to both.

Transportation is a factor in the cost of commodities scarcely second to
that of their production, and weighs as heavily upon the consumer.

Our experience already has proven the great importance of having the
competition between land carriage and water carriage fully developed,
each acting as a protection to the public against the tendencies to
monopoly which are inherent in the consolidation of wealth and power in
the hands of vast corporations.

These suggestions may serve to emphasize what I have already said on the
score of the necessity of a neutralization of any interoceanic transit;
and this can only be accomplished by making the uses of the route open
to all nations and subject to the ambitions and warlike necessities of
none.

The drawings and report of a recent survey of the Nicaragua Canal route,
made by Chief Engineer Menocal, will be communicated for your
information.

The claims of citizens of the United States for losses by reason of the
late military operations of Chile in Peru and Bolivia are the subject of
negotiation for a claims convention with Chile, providing for their
submission to arbitration.

The harmony of our relations with China is fully sustained.

In the application of the acts lately passed to execute the treaty of
1880, restrictive of the immigration of Chinese laborers into the United
States, individual cases of hardship have occurred beyond the power of
the Executive to remedy, and calling for judicial determination.

The condition of the Chinese question in the Western States and
Territories is, despite this restrictive legislation, far from being
satisfactory. The recent outbreak in Wyoming Territory, where numbers of
unoffending Chinamen, indisputably within the protection of the treaties
and