Money-Order System.-The complete and lucid exposition of the transactions of this business in the report of the veteran superintendent who has managed it with long-acknowledged ability since its original establishment, displays at large and in detail the information necessary to a satisfactory understanding of its operations and present condition.

Twenty years of practical experience have now demonstrated its great usefulness, and its growth, yet far from realized, testifies the public approbation and enjoyment of the convenience it affords our people; and, I may add, carries a suggestive recommendation of the probable favor which would follow the establishment of some of the similar systems for the transaction of small affairs which, in foreign states, have been advantageously adjoined to the postal service.

At the close of the past fiscal year the number of money-order offices was 7,056, of which 762 were established during that period, while 16 were discontinued. Additional establishments of 303, with but four discontinuances, brought up the full number at the date of the report to 7,355. Nearly 7,726,000 domestic money-orders, averaging $15.26 each, yielding an aggregate amount of nearly $924,000 in fees, were purchased during the year. Postal notes exceeding 5,000,000 in number, averag. ing $1.98 each, reaching in total almost $10,000,000, and producing over $152,000 in fees, were issued to buyers. International money orders to the number of almost 449,000 were drawn upon the nineteen different foreign countries with which a mutual interchange had been put in operation, averaging about $15.23 each, aggregating over $6,840,000 and returning gross fees exceeding $141,000.

There was a decrease in both the domestic and foreign money-order business denoting the effects of the general depression in the pecuniary affairs of the country; the more strikingly because with our increasing population there should have been under ordinary circumstances an increase of the transactions. The total volume of the business of the several kinds was, notwithstanding, very considerable, amounting to $134,695,554.11 received for orders issued, and $132,009,812.24 paid out upon them. In all this business but 53 cases of erroneous payments, or one to every 145,527 orders paid, and 122 cases of lost domestic remittances, were reported as having occurred during the year. Of the payments reported as erroneous, some proved not to have been so; for some the postmasters were held responsible; and the Department assumed during the year payment of the losses in only nineteen cases, amounting to $883.56; of these some occurred in the preceding year. Of the lost remittances, in twenty cases the money was recovered. The residue were reported to the Assistant Attorney-General of the Department for adjudication.

A summary of the revenue derived from fees shows that, above all expenditures for postmasters' commissions, clerk hire, incidental ex

penses, lost remittances, burglaries, and bad debts, there was a net

realization

From domestic orders, of..

From postal notes, of...........

From international orders, of...

A total of..

$243, 974 97 60,742 76 104, 215 47

408,933 20

Which was paid into the Treasury under the provisions of section 4050, Revised Statutes, as "net proceeds of the money-order business" for the year.

The Superintendent sets forth in detail all other expenses, which, though defrayed by the annual appropriations of Congress and not charged against the system in the Department accounts, are in fact entailed by the necessities of the business. These embraced the salaries of all clerks in his office and the Money Order Division of the Auditor's Officè, stationery, books, blanks, printing, rent, and furniture, and amounted during the year to $285,389.45. Thus, besides having been completely self-sustaining, this useful branch of the service contributed a clear net gain to the Government of $123,543.75. I shall at a later stage invite attention to the recommendations regarding it.

On the 1st of April, 1885, an interchange of money orders began with the Kingdom of Sweden, in pursuance of a convention concluded with that country by Postmaster-General Hatton in February, 1885, a copy of which is affixed to the report of the Superintendent and will be found in the appendix.

In April, 1885, pursuant to the authority given by section 4028, Revised Statutes, I signed a convention with the postal department of Japan for an interchange of money-orders with the offices of that Empire, which was executed by the Japanese postmaster-general on the 23d of May, and went into operation on the 1st of October. A copy of it is likewise appended.

It will be of interest to note that from returns already received it appears that up to November 10 nine orders, aggregating $204.05, were drawn in the United States on Japan, and up to October 21 twenty-four orders, aggregating $417.52, were drawn in Japan on the United States. Of the latter, so far as the names indicate, eleven were purchased by Japanese and thirteen by Americans. These were drawn on the following offices, respectively: Five each on New York and San Francisco; four on Boston; three on Rochester, N. Y.; two each on Brooklyn and Washington; one each on Meadville, Pa., Buffalo, N. Y., and Oakland,

Cal.

The returns, though meager, tend to show that the system will facilitate the exportation to Japan of small articles of merchandise.

The Chief Inspector's report summarizes compactly the particulars of the work of the inspecting force. The figures give but

barely a hint of the desultory, yet laborious and often trying labors performed. Cases to the number of 51,219 were investigated and reported on during the year. Necessarily, many were of comparative insignificance; but a large number were important.

The inspectors made or caused 539 arrests; in 203 cases, convictions followed; in 85, acquittals or dismissals; in 232, trials had not taken place; one prisoner escaped, three forfeited bail, and fifteen cases in the State courts were turned over for prosecution by employers.

Post offices to the number of 459 were robbed during the year, and 256 burned. Highwaymen took the mails in thirty-three instances, and minor thefts and losses were reported.

Of cases affecting the registered mail, 4,559 occurring in previous years were disposed of and 4,912 referred for investigation during the year. Of the latter, actual losses occurred, as investigation proves, in less than one-fifth; or, as proven and estimated, in but 939 cases out of 10,531,642 pieces of registered matter; a gratifying proof of the security of the system-a security which is increasing continually with improved methods.

In this class of cases, the inspectors collected $15,203.43, either from the depredators or officials chargeable with negligence contributing to the loss; of which $13,301 were paid to the owners, and $1,902.43 to the Treasury because the owners could not be found.

Of ordinary mail matter 36,410 cases were referred during the year, and 31,266 disposed of, including some arising in previous years. It will be seen that several thousand cases remained uninvestigated; a fact which ought to be relieved by a sufficient increase of the force to promptly bring the work up to date. Delayed cases usually fail of useful results; promptness of action being essential in nearly all instances in which inspectors prove of substantial value.

From delinquent postmasters and ex-postmasters and their sureties, the gross sum of $58,352.44 was recovered and paid into the Treasury, as against $26.927.11 the year before.

A large number of other cases were considered, to which no general interest attaches.

Postmasters' Claims for Losses "of money-order funds, postage stamps, stamped envelopes, newspaper wrappers, and postal cards," resulting from burglary, fire, or other unavoidable casualty, including remittances of money-order funds lost or stolen while in transit, were authorized by the act of March 17, 1882, to be allowed by the Postmaster-General upon his determination of the facts, and that "such loss resulted from no fault or negligence on the part of such postmasters," with a limitation that claims accruing before the passage of the act must be presented six months after that date, and those arising after it within three months of the loss.

All such claims are referred to the Assistant Attorney-General of the

Department for examination, and, upon his report and finding in each case, are finally reviewed and determined. A considerable labor is imposed upon that officer and the inspecting force in the performance of this duty. In the appendix will be found a report by the Assistant Attorney-General of the claims considered during the past fiscal year, and a further report, as required by law, will be laid before Congress. Five hundred and fifty cases were considered during the year, of which 385 were allowed and 165 disallowed. The total sum of $5,930.38 was allowed for loss of money-order funds-$3,155 while in transit, $175.08 by fire, and $2,600.30 by burglary. For stamps, stamped paper, and cards the gross allowance was $22,447.01-$7,407.22 by fire, $14,930.90 by burglary.

Of the disallowed claims the amount for money-order funds was $3,193.33, and for stamps, &c., $8,899.64. Of the former, $2,135 were claimed as lost in transit, $76 by fire, $532.33 by burglary, and $450 by larceny; of the latter, $1,379.81 by fire, $2,787.27 by burglary, $4,701.07 by larceny, and $31.49 by other casualty.

It will be observed that losses for larceny do not fall within the act. So also claims for losses of postal funds are not admissible under it.

Of the claims disallowed, 24 were of a character not embraced by the law, 54 were chargeable to the postmaster's fault or negligence, 38 were not sufficiently proven, 21 were withdrawn or dismissed, and 28 were not presented within the limited time.

A considerable number of the disallowed claims were meritorious, and will probably receive the favorable attention of Congress, to which body the Department will be ready to communicate such information as has been acquired in regard to them.

The six months' limitation barred many, because the act was not published so as to come to the knowledge of postmasters within that period after its passage; and many have also failed of presentation within three months after the loss, from ignorance of the law or want of understanding of its requirements.

Others have been denied by reason of a want of such care as the regulations or the duty of ordinary prudence required, yet under such circumstances as afforded no doubt of the genuineness of the loss. Wherever losses of the latter description were occasioned by fire, and were of stamps, stamped paper, or postal cards, there is some severity in imposing the consequence on the postmaster, unless his fault is flagrant, because the Government sustains in fact no loss beyond the trifling cost of manufacturing the articles. The same is true of its Treasury notes.

Losses by burglary in such cases stand on a different footing in equity, because they are actual, and should attach to the fault.

In several of the dismissed cases for money-order funds the lost money was recovered by the inspectors pending consideration.

THE CURRENT FISCAL YEAR

Must be a period so affected with the contingencies arising from the increase in the unit of weight of first-class matter, the reduction of the rate of postage on newspapers and periodicals, the introduction of the special delivery system, and the improving business condition of the country, that the deductions and expectations which might have been justified upon a survey of the business of the past year possess but a very moderate value in aiding opinion upon the probable revenue which will be gathered by the Department from the transactions of this year. It is fairly certain that realization of the estimate of a probable $51,272,820.24 submitted in the last annual report from this office, before the legislation was enacted which required the changes mentioned, cannot be regarded as possible. And even at this time no satisfactory calculation can be made which will afford any reliable approximation to the result.

The Third Assistant Postmaster-General has made an elaborate review of the statistical showing of several years, which contains many facts more interesting, in a historical aspect, than, as he wisely concludes, of headlight power.

In the hope of obtaining data on which to base something better than conjecture of the effect to follow the increase of the unit of weight of first class matter from a half-ounce to an ounce, direction was given that officer to cause a count of the matter affected by the change, as well as of unsealed parcels, during six days in June last, and again during six days in September, at the twenty post-offices which transact the most postal business. This was done with as much care and in as many forms as seemed likely to be useful, and the results are set forth in his report. Other elements, the usual difference in business between a summer and an autumn month, and especially a recognized returning commercial activity, have so entered into the figures secured, that any conclusions from them demand much qualification. Comparison of the two periods shows an increase in September at those offices of over 16 per centum in the number of pieces of first-class matter, of over 35 per cent. in weight, and of 5 per cent. in the average weight per piece. In letters weighing half an ounce or less, there was an increase of 12.8 per cent. in number, and of .05 of an ounce in average weight per piece. In letters weighing over a half ounce but not over an ounce, there was an increase of 95.6 per cent. in number, and a decrease of .22 of an ounce in average weight per piece. There was an increase of 76 per cent. in number of letters weighing over an ounce. Many other particulars are set forth in his report.

The principal results shown are, a general increase in the use of the mails, some decrease of the proportion of letters weighing less than a half-ounce, a striking increase of those weighing more than a halfounce, and some tendency to mail, more than formerly, sealed parcels instead of unsealed. No especial value attaches to these results,