To the Senate and House of Representatives of the United States:
An appalling calamity has befallen the American people since their chosen representatives last met in the halls where you are now assembled. We might else recall with unalloyed content the rare prosperity with which throughout the year the nation has been blessed. Its harvests have been plenteous; its varied industries have thriven; the health of its people has been preserved; it has maintained with foreign governments the undisturbed relations of amity and peace. For these manifestations of His favor we owe to Him who holds our destiny in His hands the tribute of our grateful devotion.
To that mysterious exercise of His will which has taken from us the loved and illustrious citizen who was but lately the head of the nation we bow in sorrow and submission.
The memory of his exalted character, of his noble achievements, and of his patriotic life will be treasured forever as a sacred possession of the whole people.
The announcement of his death drew from foreign governments and peoples tributes of sympathy and sorrow which history will record as signal tokens of the kinship of nations and the federation of mankind.
It is a matter for congratulation that the business of the country has been so prosperous during the past year as to yield by taxation a large surplus of income to the Government. If the revenue laws remain unchanged, this surplus must year by year increase, on account of the reduction of the public debt and its burden of interest and because of the rapid increase of our population. In 1860, just prior to the institution of our internal-revenue system, our population but slightly exceeded 30,000,000; by the census of 1880 it is now found to exceed 50,000,000. It is estimated that even if the annual receipts and expenditures should continue as at present the entire debt could be paid in ten years.
In view, however, of the heavy load of taxation which our people have already borne, we may well consider whether it is not the part of wisdom to reduce the revenues, even if we delay a little the payment of the debt.
It seems to me that the time has arrived when the people may justly demand some relief from their present onerous burden, and that by due economy in the various branches of the public service this may readily be afforded.
I therefore concur with the Secretary in recommending the abolition of all internal-revenue taxes except those upon tobacco in its various forms and upon distilled spirits and fermented liquors, and except also the special tax upon the manufacturers of and dealers in such articles. The retention of the latter tax is desirable as affording the officers of the Government a proper supervision of these articles for the prevention of fraud. I agree with the Secretary of the Treasury that the law imposing a stamp tax upon matches, proprietary articles, playing cards, cheeks, and drafts may with propriety be repealed, and the law also by which banks and bankers are assessed upon their capital and deposits. There seems to be a general sentiment in favor of this course.
In the present condition of our revenues the tax upon deposits is especially unjust. It was never imposed in this country until it was demanded by the necessities of war, and was never exacted, I believe, in any other country even in its greatest exigencies. Banks are required to secure their circulation by pledging with the Treasurer of the United States bonds of the General Government. The interest upon these bonds, which at the time when the tax was imposed was 6 per cent, is now in most instances 3 1/2 per cent. Besides, the entire circulation was originally limited by law and no increase was allowable. When the existing banks had practically a monopoly of the business, there was force in the suggestion that for the franchise to the favored grantees the Government might very properly exact a tax on circulation; but for years the system has been free and the amount of circulation regulated by the public demand.
The retention of this tax has been suggested as a means of reimbursing the Government for the expense of printing and furnishing the circulating notes. If the tax should be repealed, it would certainly seem proper to require the national banks to pay the amount of such expense to the Comptroller of the Currency.
It is perhaps doubtful whether the immediate reduction of the rate of taxation upon liquors and tobacco is advisable, especially in view of the drain upon the Treasury which must attend the payment of arrears of pensions. A comparison, however, of the amount of taxes collected under the varying rates of taxation which have at different times prevailed suggests the intimation that some reduction may soon be made without material diminution of the revenue.
The tariff laws also need revision; but, that a due regard may be paid to the conflicting interests of our citizens, important changes should be made with caution. If a careful revision can not be made at this session, a commission such as was lately approved by the Senate and is now recommended by the Secretary of the Treasury would doubtless lighten the labors of Congress whenever this subject shall be brought to its consideration.
Although our system of government does not contemplate that the nation should provide or support a system for the education of our people, no measures calculated to promote that general intelligence and virtue upon which the perpetuity of our institutions so greatly depends have ever been regarded with indifference by Congress or the Executive.
A large portion of the public domain has been from time to time devoted to the promotion of education.
There is now a special reason why, by setting apart the proceeds of its sales of public lands or by some other course, the Government should aid the work of education. Many who now exercise the right of suffrage are unable to read the ballot which they cast. Upon many who had just emerged from a condition of slavery were suddenly devolved the responsibilities of citizenship in that portion of the country most impoverished by war. I have been pleased to learn from the report of the Commissioner of Education that there has lately been a commendable increase of interest and effort for their instruction; but all that can be done by local legislation and private generosity should be supplemented by such aid as can be constitutionally afforded by the National Government.
I would suggest that if any fund be dedicated to this purpose it may be wisely distributed in the different States according to the ratio of illiteracy, as by this means those localities which are most in need of such assistance will reap its special benefits.
In my letter accepting the nomination for the Vice-Presidency I stated that in my judgment--
No man should be the incumbent of an office the duties of which he is for any cause unfit to perform; who is lacking in the ability, fidelity, or integrity which a proper administration of such office demands. This sentiment would doubtless meet with general acquiescence, but opinion has been widely divided upon the wisdom and practicability of the various reformatory schemes which have been suggested and of certain proposed regulations governing appointments to public office.
The efficiency of such regulations has been distrusted mainly because they have seemed to exalt mere educational and abstract tests above general business capacity and even special fitness for the particular work in hand. It seems to me that the rules which should be applied to the management of the public service may properly conform in the main to such as regulate the conduct of successful private business:
Original appointments should be based upon ascertained fitness.
The tenure of office should be stable.
Positions of responsibility should, so far as practicable, be filled by the promotion of worthy and efficient officers.
The investigation of all complaints and the punishment of all official misconduct should be prompt and thorough.
The views expressed in the foregoing letter are those which will govern my administration of the executive office. They are doubtless shared by all intelligent and patriotic citizens, however divergent in their opinions as to the best methods of putting them into practical operation.
For example, the assertion that "original appointments should be based upon ascertained fitness" is not open to dispute.
But the question how in practice such fitness can be most effectually ascertained is one which has for years excited interest and discussion. The measure which, with slight variations in its details, has lately been urged upon the attention of Congress and the Executive has as its principal feature the scheme of competitive examination. Save for certain exceptions, which need not here be specified, this plan would allow admission to the service only in its lowest grade, and would accordingly demand that all vacancies in higher positions should be filled by promotion alone. In these particulars it is in conformity with the existing civil-service system of Great Britain; and indeed the success which has attended that system in the country of its birth is the strongest argument which has been urged for its adoption here.
The fact should not, however, be overlooked that there are certain features of the English system which have not generally been received with favor in this country, even among the foremost advocates of civil-service reform.
Among them are:
1. A tenure of office winch is substantially a life tenure.
2. A limitation of the maximum age at which an applicant can enter the service, whereby all men in middle life or older are, with some exceptions, rigidly excluded.
3. A retiring allowance upon going out of office.
These three elements are as important factors of the problem as any of the others. To eliminate them from the English system would effect a most radical change in its theory and practice.
The avowed purpose of that system is to induce the educated young men of the country to devote their lives to public employment by an assurance that having once entered upon it they need never leave it, and that after voluntary retirement they shall be the recipients of an annual pension. That this system as an entirety has proved very successful in Great Britain seems to be generally conceded even by those who once opposed its adoption.
To a statute which should incorporate all its essential features I should feel bound to give my approval; but whether it would be for the best interests of the public to fix upon an expedient for immediate and extensive application which embraces certain features of the English system, but excludes or ignores others of equal importance, may be seriously doubted, even by those who are impressed, as I am myself, with the grave importance of correcting the evils which inhere in the present methods of appointment.
If, for example, the English rule which shuts out persons above the age of 25 years from a large number of public employments is not to be made an essential part of our own system, it is questionable whether the attainment of the highest number of marks at a competitive examination should be the criterion by which all applications for appointment should be put to test. And under similar conditions it may also be questioned whether admission to the service should be strictly limited to its lowest ranks.
There are very many characteristics which go to make a model civil servant. Prominent among them are probity, industry, good sense, good habits, good temper, patience, order, courtesy, tact, self-reliance, manly deference to superior officers, and manly consideration for inferiors. The absence of these traits is not supplied by wide knowledge of books, or by promptitude in answering questions, or by any other quality likely to be brought to light by competitive examination.
To make success in such a contest, therefore, an indispensable condition of public employment would very likely result in the practical exclusion of the older applicants, even though they might possess qualifications far superior to their younger and more brilliant competitors.
These suggestions must not be regarded as evincing any spirit of opposition to the competitive plan, which has been to some extent successfully employed already, and which may hereafter vindicate the claim of its most earnest supporters; but it ought to be seriously considered whether the application of the same educational standard to persons of mature years and to young men fresh from school and college would not be likely to exalt mere intellectual proficiency above other qualities of equal or greater importance.
Another feature of the proposed system is the selection by promotion of all officers of the Government above the lowest grade, except such as would fairly be regarded as exponents of the policy of the Executive and the principles of the dominant party.
To afford encouragement to faithful public servants by exciting in their minds the hope of promotion if they are found to merit it is much to be desired.
But would it be wise to adopt a rule so rigid as to permit no other mode of supplying the intermediate walks of the service?
There are many persons who fill subordinate positions with great credit, but lack those qualities which are requisite for higher posts of duty; and, besides, the modes of thought and action of one whose service in a governmental bureau has been long continued are often so cramped by routine procedure as almost to disqualify him from instituting changes required by the public interests. An infusion of new blood from time to time into the middle ranks of the service might be very beneficial in its results.
The subject under discussion is one of grave importance. The evils which are complained of can not be eradicated at once; the work must be gradual.
The present English system is a growth of years, and was not created by a single stroke of executive or legislative action.
Its beginnings are found in an order in council promulgated in 1855, and it was after patient and cautious scrutiny of its workings that fifteen years later it took its present shape.
Five years after the issuance of the order in council, and at a time when resort had been had to competitive examinations as an experiment much more extensively than has yet been the case in this country, a select committee of the House of Commons made a report to that House which, declaring its approval of the competitive plan, deprecated, nevertheless, any precipitancy in its general adoption as likely to endanger its ultimate success.
During this tentative period the results of the two methods of pass examination and competitive examination were closely watched and compared. It may be that before we confine ourselves upon this important question within the stringent bounds of statutory enactment we may profitably await the result of further inquiry and experiment.
The submission of a portion of the nominations to a central board of examiners selected solely for testing the qualifications of applicants may perhaps, without resort to the competitive test, put an end to the mischiefs which attend the present system of appointment, and it may be feasible to vest in such a board a wide discretion to ascertain the characteristics and attainments of candidates in those particulars which I have already referred to as being no less important than mere intellectual attainment.
If Congress should deem it advisable at the present session to establish competitive tests for admission to the service, no doubts such as have been suggested shall deter me from giving the measure my earnest support.
And I urgently recommend, should there be a failure to pass any other act upon this subject, that an appropriation of $25,000 per year may be made for the enforcement of section 1753 of the Revised Statutes.
With the aid thus afforded me I shall strive to execute the provisions of that law according to its letter and spirit.
I am unwilling, in justice to the present civil servants of the Government, to dismiss this subject without declaring my dissent from the severe and almost indiscriminate censure with which they have been recently assailed. That they are as a class indolent, inefficient, and corrupt is a statement which has been often made and widely credited; but when the extent, variety, delicacy, and importance of their duties are considered the great majority of the employees of the Government are, in my judgment, deserving of high commendation.
Deeply impressed with the gravity of the responsibilities which have so unexpectedly devolved upon me, it will be my constant purpose to cooperate with you in such measures as will promote the glory of the country and the prosperity of its people.


Citation: Chester A. Arthur: "First Annual Message," December 6, 1881. Online by Gerhard Peters and John T. Woolley, The American Presidency Project.

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