DEBTS

The current debt and interest due from foreign Governments, exclusive of the British debt of $4,600,000,000, is about $7,200,000,000.  I do not favor the cancellation of this debt, but I see no objection to adjusting it in accordance with the principle adopted for the British debt.  Our country would not wish to assume the role of an oppressive creditor, but would maintain the principle that financial obligations between nations are likewise moral obligations which international faith and honor require should be discharged.

Our Government has a liquidated claim against Germany for the expense of the army of occupation of over $255,000,000.  Besides this, the Mixed Claims Commission have before them about 12,500 claims of American citizens, aggregating about $1,225,000,000.  These claims have already been reduced by a recent decision, but there are valid claims reaching well toward $500,000,000.  Our thousands of citizens with credits due them of hundreds of millions of dollars have no redress save in the action of our Government.  These are very substantial interests, which it is the duty of our Government to protect as best it can.  That course I propose to pursue.

It is for these reasons that we have a direct interest in the economic recovery of Europe.  They are enlarged by our desire for the stability of civilization and the welfare of humanity.  That we are making sacrifices to that end none can deny.  Our deferred interest alone amounts to a million dollars every day.  But recently we offered to aid with our advice and counsel.  We have reiterated our desire to see France paid and Germany revived.  We have proposed disarmament.  We have earnestly sought to compose differences and restore peace.  We shall persevere in well-doing, not by force, but by reason.

FOREIGN PAPERS

Under the law the papers pertaining to foreign relations to be printed are transmitted as a part of this message.  Other volumes of these papers will follow.

FOREIGN SERVICE

The foreign service of our Government needs to be reorganized and improved.

FISCAL CONDITION

Our main problems are domestic problems.  Financial stability is the first requisite of sound government.  We can not escape the effect of world conditions.  We can not avoid the inevitable results of the economic disorders which have reached all nations.  But we shall diminish their harm to us in proportion as we continue to restore our Government finances to a secure and endurable position.  This we can and must do.  Upon that firm foundation rests the only hope of progress and prosperity.  From that source must come relief for the people.