such notes as herein provided it shall be the duty of the Secretary of the Treasury to set apart in the Treasury a reserve fund of one hundred and fifty million dollars in gold coin and bullion, which fund shall be used for such redemption purposes only, and whenever and as often as any of said notes shall be redeemed from said fund it shall be the duty of the Secretary of the Treasury to use said notes so redeemed to restore and maintain such reserve fund in the manner following, to wit: First, by exchanging the notes so redeemed for any gold coin in the general fund of the Treasury; second, by accepting deposits of gold coin at the Treasury or at any subtreasury in exchange for the United States notes so redeemed; third, by procuring gold coin by the use of said notes, in accordance with the provisions of section thirty-seven hundred of the Revised Statutes of the United States. If the Secretary of the Treasury is unable to restore and maintain the gold coin in the reserve fund by the foregoing methods, and the amount of such gold coin and bullion in said fund shall at any time fall below one hundred million dollars, then it shall be his duty to restore the same to the maximum sum of one hundred and fifty million dollars by borrowing money on the credit of the United States, and for the debt thus incurred to issue and sell coupon or registered bonds of the United States, in such form as he may prescribe, in denominations of fifty dollars or any multiple thereof, bearing interest at the rate of not exceeding three per centum per annum, payable quarterly, such bonds to be payable at the pleasure of the United States after one year from the date of their issue, and to be payable, principal and interest, in gold coin of the present standard value, and to be exempt from the payment of all taxes or duties of the United States, as well as from taxation in any form by or under State, municipal, or local authority; and the gold coin received from the sale of said bonds shall first be covered into the general fund of the Treasury and then exchanged, in the manner hereinbefore provided, for an equal amount of the notes redeemed and held for exchange, and the Secretary of the Treasury may, in his discretion, use said notes in exchange for gold, or to purchase or redeem any bonds of the United States, or for any other lawful purpose the public interests may require, except that they shall

That

not be used to meet deficiencies in the current revenues. United States notes when redeemed in accordance with the provisions of this section shall be reissued, but shall be held in the reserve fund until exchanged for gold, as herein provided; and the gold coin and bullion in the reserve fund, together with the redeemed notes held for use as provided in this section, shall at no time exceed the maximum sum of one hundred and fifty million dollars.

SEC. 3. That nothing contained in this Act shall be construed to affect the legal-tender quality as now provided by law of the silver dollar, or of any other money coined or issued by the United States.

SEC. 4. [Divisions of issue and redemption to be established in the Treasury Department.]

SEC. 5. That it shall be the duty of the Secretary of the Treasury, as fast as standard silver dollars are coined under the provisions of the Acts of . . . [July 14, 1890, and June 13, 1898] . . ., from bullion purchased under the Act of [July 14, 1890]. . ., to retire and cancel an equal amount of Treasury notes whenever received into the Treasury, either by exchange in accordance with the provisions of this Act or in the ordinary course of business, and upon the cancellation of Treasury notes silver certificates shall be issued against the silver dollars so coined.

SEC. 6. That the Secretary of the Treasury is hereby authorized and directed to receive deposits of gold coin with the Treasurer or any assistant treasurer of the United States in sums of not less than twenty dollars, and to issue gold certificates therefor in denominations of not less than twenty dollars, and the coin so deposited shall be retained in the Treasury and held for the payment of such certificates on demand, and used for no other purpose. Such certificates shall be receivable for customs, taxes, and all public dues, and when so received may be reissued, and when held by any national banking association may be counted as a part of its lawful reserve: Provided,1 That whenever and so long as the gold coin held in the reserve fund in the Treasury for the redemption of United States

1 Amended by acts of May 26, 1906 (U. S. Stat. at Large, XXXIV., Part 1, 202), and March 4, 1907 (ibid., XXXIV., Part 1, 1289, 1290). — Ed.

notes and Treasury notes shall fall and remain below one hundred million dollars the authority to issue certificates as herein provided shall be suspended: And provided further, That whenever and so long as the aggregate amount of United States notes and silver certificates in the general fund of the Treasury shall exceed sixty million dollars the Secretary of the Treasury may, in his discretion, suspend the issue of the certificates herein provided for: And provided further, That of the amount of such outstanding certificates one-fourth at least shall be in denominations of fifty dollars or less: And provided further, That the Secretary of the Treasury may, in his discretion, issue such certificates in denominations of ten thousand dollars, payable to order. [Sec. 5193 of Revised Statutes repealed.]

SEC. 7. That hereafter silver certificates shall be issued only of denominations of ten dollars and under, except that not exceeding in the aggregate ten per centum of the total volume of said certificates, in the discretion of the Secretary of the Treasury, may be issued in denominations of twenty dollars, fifty dollars, and one hundred dollars; and silver certificates of higher denomination than ten dollars, except as herein provided, shall, whenever received at the Treasury or redeemed, be retired and canceled, and certificates of denominations of ten dollars or less shall be substituted therefor, and after such substitution, in whole or in part, a like volume of United States notes of less denomination than ten dollars shall from time to time be retired and canceled, and notes of denominations of ten dollars and upward shall be reissued in substitution therefor, with like qualities and restrictions as those retired and canceled.1

SEC. 8. That the Secretary of the Treasury is hereby authorized to use, at his discretion, any silver bullion in the Treasury of the United States purchased under the Act of . . . [July 14, 1890] . . ., for coinage into such denominations of subsidiary silver coin as may be necessary to meet the public requirements for such coin: Provided, That the amount of subsidiary silver coin outstanding shall not at any time exceed in the aggregate one hundred millions of dollars. Whenever any silver bullion purchased under the Act of [July 14, 1890] . . ., shall be used in the coinage of subsidiary silver coin, an amount of 1 Amended by act of March 4, 1907 (U. S. Stat. at Large, XXXIV., 1289). — ED

.

Treasury notes issued under said Act equal to the cost of the bullion contained in such coin shall be canceled and not reissued. SEC. 9. [Uncurrent subsidiary silver coin to be recoined.]

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II.

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SEC. 11. That the Secretary of the Treasury is hereby authorized to receive at the Treasury any of the outstanding bonds of the United States bearing interest at five per centum per annum, payable . [February 1, 1904] . and any bonds of the United States bearing interest at four per centum per annum, payable . . . [July 1, 1907] . . and any bonds of the United States bearing interest at three per centum per annum, payable . . . [August 1, 1908] . . ., and to issue in exchange therefor an equal amount of coupon or registered bonds of the United States in such form as he may prescribe, in denominations of fifty dollars or any multiple thereof, bearing interest at the rate of two per centum per annum, payable quarterly, such bonds to be payable at the pleasure of the United States after thirty years from the date of their issue, and said bonds to be payable, principal and interest, in gold coin of the present standard value, and to be exempt from the payment of all taxes or duties of the United States, as well as from taxation in any form by or under State, municipal, or local authority: Provided, That such outstanding bonds may be received in exchange at a valuation not greater than their present worth to yield an income of two and one-quarter per centum per annum; and in consideration of the reduction of interest effected, the Secretary of the Treasury is authorized to pay to the holders of the outstanding bonds surrendered for exchange, out of any money in the Treasury not otherwise appropriated, a sum not greater than the difference between their present worth, computed as aforesaid, and their par value

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SEC. 14. That the provisions of this Act are not intended to preclude the accomplishment of international bimetallism whenever conditions shall make it expedient and practicable to secure the same by concurrent action of the leading commercial nations of the world and at a ratio which shall insure permanence of relative value between gold and silver.

Approved, March 14, 1900.

No. 189. Treaty with Great Britain regarding an Isthmian Canal

November 18, 1901

By the Clayton-Bulwer treaty of 1850 the United States and Great Britain agreed upon a joint control and neutralization of any isthmian canal that might thereafter be constructed. The apparent prospect of the construction of a canal at Panama by a French company led to an increasing demand in the United States for the abrogation of the treaty, and for the control of the canal by the United States alone. The Hay-Pauncefote treaty of February 5, 1900, authorized the construction of a canal either by the United States or by a private corporation, but retained the provision for neutralization. Amendments made by the Senate, declaring the Clayton-Bulwer treaty superseded and authorizing defensive measures by the United States in the management of the canal, were rejected by Great Britain, and the treaty failed. The Hay-Pauncefote treaty of November 18, 1901, in form a compromise between the original draft of 1900 and the Senate amendments, was ratified by President Roosevelt December 26, and by Great Britain January 20, 1902, and on February 22 was proclaimed. See post, Nos. 191 and 192.

REFERENCES. - Text in U. S. Stat. at Large, XXXII., Part 2, 19031905. The treaty of 1900, with other documents, is in Senate Document 85, 57th Cong., 1st Sess. (reprinted in Foreign Relations, 1901, pp. 237-246). The comparative merits of the Nicaragua and Panama routes were exhaustively treated by Senator Morgan, of Alabama, in Senate Report 1337, 56th Cong., 1st Sess. See also the report of the Walker commission, November 30, 1900 (Senate Doc. 5, 56th Cong., 2d Sess.). For the diplomatic history of the canal question see Moore, Digest of International Law, III., 2–222.

ARTICLE I.

The High Contracting Parties agree that the present Treaty shall supersede the afore-mentioned Convention [the ClaytonBulwer treaty] of the 19th April, 1850.

ARTICLE II.

It is agreed that the canal may be constructed under the auspices of the Government of the United States, either directly at its own cost, or by gift or loan of money to individuals or Corporations, or through subscription to or purchase of stock or shares, and that, subject to the provisions of the present