I have the honor to submit herewith for transmission to Congress, in accordance with the provisions of the organic act, the annual report of this Department.

I took charge of this Department about the middle of the fiscal year, namely, on December 17, 1906, succeeding the Hon. Victor H. Metcalf, who became Secretary of the Navy.

The Department was organized under the act approved February 14, 1903. The scope of its jurisdiction is set forth in the act:

It shall be the province and duty of said Department to foster, promote, and develop the foreign and domestic commerce, the mining, manufacturing, shipping, and fishery industries, the labor interests, and the transportation facilities of the United States; and to this end it shall be vested with jurisdiction and control of the departments, bureaus, offices, and branches of the public service hereinafter specified, and with such other powers and duties as may be prescribed by law.

The Department as at present constituted is composed of the following bureaus:

These bureaus will be considered under their respective titles. This Department, which is the most recent in its creation, has been steadily growing and is rapidly coming into closer relations with the

commercial and labor interests of the country. It is primarily and largely connected with the internal economic interests of the country, in the consideration of which, however, it is necessary not to lose sight of the international relations upon which it has an important bearing.

Because the Department comprises so many different governmental activities, I have deemed it in the interest of good administration periodically to call together in conference the chiefs of the several bureaus for the purpose of considering questions which, although under the immediate jurisdiction of a specific bureau, are none the less connected with interests that are intrusted to other bureaus of the Department. The results of these conferences have been very beneficial in enlarging the views of the bureau chiefs and in directing their attention to other branches of the Department which have different, though related, interests. The exchange of views at these conferences has not only been helpful to the respective bureau chiefs, but of advantage in enabling me to become more conversant with the details of the work in the various bureaus. By this means also I have been able to apply to this branch of the Government service the business principles that are so helpful to good administration.

The tendency of Government administration, especially in a Department such as this, which has to do so largely with economic and sociological questions, is to develop more along scientific lines and not to keep sufficiently close in touch with the practical and commercial interests of the country. It has been my purpose to overcome this natural tendency, and I hope to bring the Department, especially its Bureau of Manufactures, in direct contact with the leading commercial bodies, such as the chambers of commerce and boards of trade, in the principal cities of the country. This will not only be beneficial in guiding the Department to exert its efforts in extending the commerce of the United States, but also helpful to the commercial interests of the country in imparting such information as comes to it through our consuls and through special agents sent abroad to investigate trade conditions in foreign lands.

Germany, through its department of commerce, which is under the ministry of the interior, and similar departments in the larger States of the Empire, comes in close touch with the commercial interests by furnishing information and advice to its merchants and manufacturers. This purpose is very much facilitated in Germany by reason of the fact that the chambers of commerce are semiofficial bodies whose functions and activities are strictly regulated by law. While I see no need, under our system, of endowing these organizations with semiofficial functions, there is every reason why a close relationship between this Department and such bodies should exist.

IMMIGRATION AND NATURALIZATION.

The act of June 29, 1906, changed the designation of the Bureau of Immigration to the "Bureau of Immigration and Naturalization," and placed under that Bureau all matters concerning the naturalization of aliens. The centralization in this Executive Department of the supervision over the process of naturalization renders it practicable to greatly diminish, if not entirely to eliminate, fraud by preventing illegal naturalization based on false testimony. It also enables the Government to more readily detect irregular and fraudulent naturalization and to cancel certificates of naturalization hitherto illegally obtained. These results are accomplished by means of investigations by the naturalization examiners.

IMMIGRATION.

The subject of immigration is naturally one that has advanced to a position of greater importance in this country than in any other country during modern times. Our growth from the beginning was due to the migration of peoples from the older nations of the world to this continent. During earlier ages migrations were due to dif ferent causes and were for different purposes than those which impelled the migration especially to our portion of the continent. Previous migrations were due principally to the spirit of conquest, and they were en masse and not individualistic. They were undertaken for the benefit of the state from which the migrants came, as in Roman times, and not for the benefit of the individual. The migrations were for conquest, for colonization, or for commerceall undertaken under the patronage of the state from which the migrants came, and were sent or financed by the governments of such countries. This was true not only of Roman imperialistic expansion, but also of the Spanish conquests on this continent. A clear line of distinction must be drawn between this form of migration and that which is individualistic and properly termed immigration. Up to the close of the civil war all of our laws upon this subject were framed to encourage immigration. From that time on legislation was directed toward the elimination of undesirable immigration, principally criminals and paupers, who did not come to us of their own volition, but because their governments desired to be rid of them. Since the period above mentioned the laws that have been passed upon the subject, while in no way hostile to immigration as such, have proceeded upon the general policy of selection, thereby excluding more and more individuals coming under the general designation of "undesirable classes."

The act of February 20, 1907, has made some material changes, which are referred to in detail in the report of the CommissionerGeneral of Immigration.

The previous law and the administration thereof, probably due to oversight, made no provision for the exemption of diplomatic and consular officers and other officials duly accredited by their governments, together with their suites, coming to this country, from the requirements of that law. Some of these officials very properly objected and felt irritated because they were subjected, by the masters or commanding officers of steamers on which they arrived, to questions that aliens are required under the regulations to answer in order to complete the ships' manifests. Accordingly, on January 11 and February 4, 1907, I issued orders exempting the officials in question from such regulations. Such exemptions have since been incorporated in the new law (section 41).

The total number of aliens admitted during the year was 1,285,349, which exceeded that for the fiscal year 1906 by 184,614, and that for the fiscal year 1905 by 258,850, being increases of 17 and 25 per cent, respectively. During the year 13,064 aliens were rejected, an increase over the rejections for the fiscal year 1906 of 632. The total number seeking admission in 1907, therefore, was 1,298,413, an increase over the total number applying in 1906 of 185,246.

A notable feature of the immigration consists in the fact that of the aliens admitted, 1,100,771 ranged in age from 14 to 44 years, and 138,344 were less than 14 years of age, leaving only 46,234 who had reached or passed the age of 45. As to literacy, it is shown that 343,402, or 30 per cent of the total number of aliens admitted, were illiterate. Concerning the financial condition of the immigrants, 873,923 exhibited less than $50 each-how much more they had it is impossible to state-while 107,502 showed amounts in excess of that sum; and the total amount of money which was exhibited by arriving aliens, and brought into the country, was $25,599,893, an average of almost $20 per person. There has been a considerable increase in the number of persons rejected because of insanity, contagious diseases, and convictions for crime. The hospitals of this country afforded relief during the year to 11,528 aliens, and warrants of deportation were executed in the cases of 995 on the ground of unlawful residence or because of having become public charges, and for other causes, a hearing having been granted in each case. The total number of aliens actually returned to the countries whence they came, therefore (13,064 plus 995), was 14,059, which, compared with the total number returned during the year 1906 (12,432 plus 676), 13,108, shows an increase of 951, or over 7 per cent.

In order to ascertain the net increase of our population from year to year by immigration it is necessary to deduct from the figures above given the number of aliens who have departed from the United States during the fiscal year, as well as the number deported and the number of naturalized citizens who permanently left

the country during the same period. It is estimated that about 310,000 aliens departed from the United States during the fiscal year, of which number probably 100,000 were of the nonimmigrant alien class, thus reducing the immigration for the year to about 1,075,000. From these figures is further to be deducted the number of naturalized citizens who during the year have permanently left the country, as well as the number who have been deported. We have no figures which will enable us with any degree of definiteness to ascertain the number of returning aliens. The new law, however, contains provisions for ascertaining these figures, so that for the next year we will have reliable data as to the number of outgoing aliens, but not as to the number of naturalized aliens who leave the country to live permanently abroad. The only data we have are the reports furnished the Bureau by the Trans-Atlantic Passenger Conference. From their compilation for the year ended June 30, 1907, we get the following figures of the passengers who left the port of New York, which may be of interest: First cabin, 95,681; second cabin, 97,532; steerage, 340,375; a total of 533,588. Of the 340,375 outgoing steerage passengers, how many permanently remain abroad and how many return to this country, and of course are again enumerated as arriving aliens, we are unable from present data to form an estimate.

DISTRIBUTION OF IMMIGRANTS.

The considerable increase of immigration for recent years is due to causes external as well as internal. The rapidity of communication and the cheapness of passenger traffic have made it much easier, especially for the laboring classes, to migrate, and the result is seen not only in our immigration, but to a much larger relative extent in the immigration into Canada and into other countries on this continent, particularly Brazil, Mexico, and Argentina. The external impelling causes are religious oppressions and economic pressure, and the internal causes are commercial prosperity and the opportunities and advantages that are afforded for better conditions in our free and democratic country. By examining the illuminating statistical tables in the Commissioner-General's report it will be seen that our immigration is an index of our prosperity.

The main objection to the greatly increased immigration during the past decade is because of the congestion and the consequent evils caused thereby in our larger Atlantic seaport cities. Congress, doubtless in recognition of this fact, made provision in the new act (section 40) for a Division of Information, which might more accurately be designated a " Division of Information and Distribution." I desire to direct special attention to that part of the report of the CommissionerGeneral of Immigration dealing with this subject. It is hoped that this division will materially aid in directing immigrants to those