Mr. Willis to Mr. Olney.
Honolulu, August 14, 1895. (Received Aug. 27.)
Sir: The legislature which has been in session during the past six weeks will adjourn on the 16th instant.
The Government proposition to make an allowance of $4,000 per annum for the ex-Princess Kaiulani was defeated.
On the 12th instant an agreement was entered into between this Government and Z. S. Spaulding, of this city, for the construction of a cable connecting the several islands of the Republic of Hawaii with San Francisco. This Government agrees to pay the contractor an annual subsidy of $40,000 for twenty years from the date of the establishment of the cable, provided that the construction thereof shall begin before May 1, 1897, and such telegraphic communication be established by November 1, 1898, and provided further that the Government of the United States shall join in the undertaking by the grant of substantial assistance to the contractor. This grant, which is exclusive, is not to conflict with the treaty rights of foreign Governments. The agreement thus entered into by this Government was ratified by the legislature on the 14th instant, at which time Minister Hatch made this statement:
The United States has three propositions to consider: First, the laying of an exclusive telegraph cable to be owned by the United States; second, the question of granting consent to the British Government to lay a cable to Necker Island and thence to these islands; third, the laying of a cable by a private corporation, such as that proposed by Colonel Spaulding. If the first two should be dropped, the only possible proposition left would be the third, namely, the laying of a cable by a private corporation. The whole matter was subject to the approval of the United States. If the measure was favored by the United States work would be begun immediately.
On the 26th ultimo Mr. Hatch, responding to the Senate’s request, submitted my letter in reference to the claim of Mr. Dureell. When the final answer of this Government is received I will transmit the full correspondence.
On the 13th ultimo this Government took formal possession of French Frigate Shoal.
Conditions remain peaceful.
I am, etc.,