The work of the commission of inquiry and conciliation between Bolivia and Paraguay, in which a representative of this Government participated, has successfully terminated an incident which seemed to threaten war.  The proposed plan for final settlement as suggested by the neutral governments is still under consideration.

This Government has continued its efforts to act as a mediator in boundary difficulties between Guatemala and Honduras.

A further instance of profound importance in establishing good will was the inauguration of regular air mail service between the United States and Caribbean, Central American, and South American countries.

We still have marines on foreign soil—­in Nicaragua, Haiti, and China.  In the large sense we do not wish to be represented abroad in such manner.  About 1,600 marines remain in Nicaragua at the urgent request of that government and the leaders of all parties pending the training of a domestic constabulary capable of insuring tranquility.  We have already reduced these forces materially and we are anxious to withdraw them further as the situation warrants.  In Haiti we have about 700 marines, but it is a much more difficult problem, the solution of which is still obscure.  If Congress approves, I shall dispatch a commission to Haiti to review and study the matter in an endeavor to arrive at some more definite policy than at present.  Our forces in China constitute 2,605 men, which we hope also further to reduce to the normal legation guard.

It is my desire to establish more firmly our understanding and relationships with the Latin American countries by strengthening the diplomatic missions to those countries.  It is my hope to secure men long experienced in our Diplomatic Service, who speak the languages of the peoples to whom they are accredited, as chiefs of our diplomatic missions in these States.  I shall send to the Senate at an early date the nominations of several such men.

The Congress has by numerous wise and foresighted acts in the past few years greatly strengthened the character of our representation abroad.  It has made liberal provision for the establishment of suitable quarters for our foreign staffs in the different countries.  In order, however, that we may further develop the most effective force in this, one of the most responsible functions of our Government, I shall recommend to the Congress more liberal appropriations for the work of the State Department.  I know of no expenditure of public money from which a greater economic and moral return can come to us than by assuring the most effective conduct of our foreign relations.

NATIONAL DEFENSE

To preserve internal order and freedom from encroachment is the first purpose of government.  Our Army and Navy are being maintained in a most efficient state under officers of high intelligence and zeal.  The extent and expansion of their numbers and equipment as at present authorized are ample for this purpose.