To the Senate and House of Representatives:

By the terms of section 1963, United States Revised Statutes, the Secretary of Commerce and Labor is directed, at the expiration of the lease which gives the North American Commercial Company the right to engage in taking fur seals on the islands of St. Paul and St. George, to enter into a new lease covering the same purpose for a period of twenty years. The present lease will expire on the 30th of April, 1910, and it is important to determine whether or not changed conditions call for a modification of the policy which has so far been followed.

The Secretary of State and the Secretary of Commerce and Labor unite in recommending a radical change of this policy. It appears that the seal herds on the islands named have been reduced to such an extent that their early extinction must be looked for unless measures for their preservation be adopted. A herd numbering 375,000 twelve years ago is now reduced to 134,000, and it is estimated that the breeding seals have been reduced in the same period of time from 130,000 to 56,000. The rapid depletion of these herds is undoubtedly to be ascribed to the practice of pelagic sealing, which prevails in spite of the constant and earnest efforts on the part of this Government to have it discontinued.

The policy which the United States has adopted with respect to the killing of seals on the islands is not believed to have had a substantial effect upon the reduction of the herd. But the discontinuance of this policy is recommended in order that the United States may be free to deal with the general question in its negotiations with foreign countries. To that end it is recommended that the leasing system be abandoned for the present, and that the Government take over entire control of the islands, including the inhabitants and the seal herds. The objection which has heretofore been made to this policy, upon the ground that the Government would engage in private business, has been deprived of practical force. The herds have been reduced to such an extent that the question of profit has become a mere incident, and the controlling question has become one of conservation.

It is recommended, therefore, that the provision for a renewal of the lease be repealed, and that instead a law be enacted to authorize the Department of Commerce and Labor to take charge of the islands, with authority to protect the inhabitants substantially as has been done in the past, and to control the seal herds as far as present conditions admit of, pending negotiations with foreign countries looking to the discontinuance of pelagic sealing. If this result can be obtained, as is confidently believed, there is every prospect that the seal herds will not only be preserved but will increase, so as to make them a source of permanent income.

A draft of a bill covering this matter has been prepared by the Secretary of Commerce and Labor, and upon request will be submitted to the appropriate committees.

WILLIAM H. TAFT