parity of growth between numbers and values being due to the tendency during the intervening time to cheaper postages. The cost of manufacturing these articles was $738,296.13 for the year ended June 30, 1877, and for the year ended June 39, 1885, it was $946,925.39, an increase of $208,629.26, or 28.2 per cent., as against an increase of 107.6 per cent. in the number of articles furnished.

Taking the items separately, during the year ended June 30, 1877, the number of adhesive postage stamps issued was 690,969,379, valued at $19,182.281.10, and costing $100,270.18 for manufacture; of stamped envelopes and newspaper-wrappers the number issued was 170,651,450, valued at $4,616,931.76, and costing $400,216.81; and of postal-cards the number issued was 170,015,500, valued at $1,700,155, and costing $237,809.14.

During the year ended June 30, 1885, the number of adhesive postagestamps issued was 1.480,510,990, valued at $30,785,388.50, and costing $136.058.96 for manufacture (not including $1,694.51, being the cost of official and other obsolete stamps remaining in the hands of the contractor, and destroyed by a committee, as detailed in Ex. Doc. 264, H. R., 2d sess., 48th Cong., previously alluded to); of stamped envelopes and newspaper wrappers the number issued was 322,751,400, valued at $6,279.962.54, and costing $626.165.56; and of postal cards the number issued was 339,336.500, valued at $3,393,365, and costing $184,700.57 (exclusive of 80,000 2-cent cards previously in stock).

The increase in the issues of adhesive postage stamps was 789,541,611, or 114.2 per cent., in number, $11,603,107.40, or 60.4 per cent, in value, and $35,788.78, or 35.6 per cent., in cost; of stamped envelopes and newspaper wrappers the increase was 152,099,950, or 89.1 per cent., in number, $1,663,030.78, or 36 per cent., in value, and $225,948.75, or 56.4 per cent., in cost; and of postal cards there was an increase of 169,321.000, or 99.5 per cent., in number. $1,693,210, or 99.5 per cent., in value, and a decrease of $53,108.27, or 22.3 per cent., in cost.

Of the total issues for the year ended June 30, 1877, adhesive postagestamps represented 67 per cent. in number, 75.2 per cent. in value, and 13.5 per cent. in cost of manufacture; stamped envelopes and newspaper wrappers 16.5 per ceut. in number, 18.1 per cent. in value, and 54.2 per cent. in cost; and postal cards 16.4 per cent. in number, 6.6 per cent. in value, and 32.2 per cent. in cost.

Of the total issues for the year ended June 30, 1885, adhesive postagestamps represented 69.09 per cent. in number, 76.09 per cent. in value, and 14.3 per cent. in cost of manufacture; stamped envelopes and newspaper wrappers 15 per cent. in number, 15.5 per cent. in value, and 66.1 per cent. in cost; and postal cards 15.9 per cent. in number, 8.3 per cent. in value, and 19.5 per cent. in cost.

As compared with the year ended June 30, 1877, the prices in the present contract for adhesive postage stamps show a reduction of 51.6 per cent., and in the present contract for postal cards a reduction of 65.8 per cent., based upon like quantities. In the present contract (awarded in 1882) for stamped envelopes and newspaper wrappers the prices are 22.82 per cent. less than those in the contract in force during the year ended June 30, 1877.

In registered package, official, and dead-letter envelopes (not includ ing official stamped envelopes provided by separate contract), the prices in the present contract are 48.1 per cent. less than those in the contract for the year ended June 30, 1877, for like kinds and quantities. In the first contract for the year commencing July 1, 1884 (subsequently annulled), the prices were 36.7 per cent. less than those in the contract for

the year ended June 30, 1877. The total number of registered package, official, and dead-letter envelopes, and official stamped envelopes for the Post-Office Department, issued in 1877, was 28,152,400, costing $88,292.94 for manufacture. The estimated number of registered package, registered-tag, official (the official envelopes now in use corresponding to both the ordinary official and the official stamped envelopes in use in 1877), and dead-letter envelopes to be required for the fiscal year ending June 30, 1886, is 39,529,000, at an estimated cost of $63,434.84 for manufacture. This is an increase of 11,376,600, or 40.4 per cent., in the number of articles, and a decrease of $24,858.10, or 28.1 per cent., in the cost of manufacture, as compared to 1877..

The saving is best exhibited by separating the registered-package envelopes from the envelopes for inclosing ordinary official matter. The number of registered-package envelopes issued in 1877 was 5,137,000, at a cost of $35,548.04 for manufacture. The number contemplated by the estimates for the present fiscal year is 8,914,000. This is an increase of 3,777,000, or 73.5 per cent., in number, and a decrease of $2,387.96, or 6.7 per cent., in cost of manufacture. The saving in this class of envelopes alone, as compared to 1877, is therefore at the rate of 46.2 per cent. Of the envelopes (both ordinary official and official stamped envelopes) for official correspondence, the number issued in 1877 was 23,015,400, costing $52,744.90 for manufacture. The estimated number required for the present year is 30,615,000, at a cost of $30,274.76 for manufacture. This is an increase of 7,599,600, or 33 per cent., in number, and a decrease of $22,470.14, or 42.6 per cent., in cost of manufacture. The saving in the ordinary official envelopes in 1886, as compared to the ordinary official and official stamped envelopes in 1877, is therefore at the rate of 56.8 per cent.

The number of adhesive postage stamps, stamped envelopes, and postal cards to be required for sale to the public during the year ending June 30, 1886, is estimated at 2,228,386,045, an increase of 1,196,749,716, or 116 per cent., as compared to the issues of 1877. It will be seen that the increase in the number of envelopes to be required for ordinary official correspondence for the year 1886 is only at the rate of 33 per cent. over the number issued in 1877. This is not to be taken as an indication that the requirements of the postal service do not keep pace with those of the public, but it is explained by the fact that large quantities of official envelopes have been superseded by the use of card forms, or "official postal cards," for conveying information relating to postal business. These card forms were adopted in 1878, and were first applied to the business of the registry system. In this system alone the additional number of official envelopes that would be required, except for the substitution of these card forms, will reach fully 25,000,000 for the current year. For the return registry receipt a single card supersedes the use of two envelopes; one for returning the receipt of the addressee of a registered letter to the mailing oflice, and the other for inclosing it by the latter to the sender of the letter. The great saving effected in clerical labor by this substitution is of much more consequence than the saving in the cost of the envelopes.

For the year ended June 30, 1877, the expenditures for the service of this office amounted to $845,306.83, representing 2.6 per cent. of the total expenditures (832,322,504.24) of the postal service. The estimated expenditures for the service of this office for the fiscal year commencing July 1, 1886, are $992,400, or 1.8 per cent. of the total amount ($54,986,166.89) of the estimated expenditures for the postal service.

DIVISION OF REGISTRATION.

There were registered during the year in all the post-offices of the country 11,043,256 letters and parcels. Of this number 7,794,067 were domestic letters, 983,303 were domestic parcels of third and fourth class matter, 475,806 were letters to foreign countries, 35,808 were parcels of third and fourth class matter to foreign countries, and 1,754,272 were letters and parcels of official matter forwarded for the Government and by law exempted from the payment of the registry fee.

The amount of registry fees collected during the year was $928,898.40, which is $28,160.90, or 2.9 per cent., less than the amount of fees collected during the previous year.

The decrease in the total number of letters and parcels registered was 203,289, or 1.8 per cent. Separately considered, the decrease of domestic letters and parcels was 296,833, or 3.2 per cent., and of foreign letters and parcels there was an increase of 15,224, or 3 per cent. The decrease of domestic letters alone was 274,271, or 3.3 per cent., and of domestic parcels 22,562, or 2.2 per cent. The increase of foreign letters was 8,904, or 1.9 per cent., and of foreign parcels 6,320, or 21.4 per cent.

In view of the great growth of the registry system within the past few years, the present decrease may seem somewhat surprising; but it is to be accounted for in the main by the extreme depression of the general business of the country, which affected all the channels of the postal revenue, and which it is to be hoped reached its lowest stage during the past fiscal year. Its effects were felt to a considerable extent during the previous fiscal year, when the increase of receipts of regis tration was only 3.3 per cent., as against an average annual increase of 167 per cent. for the six years immediately preceding.

A minor loss to the receipts from registered matter occurred through the operation of the act of Congress of July 5, 1884, providing for the free registration in general of official matter from the Executive Departments at Washington. This privilege had previously been confined to the official matter of the Post-Office Department, and of certain bureaus of the Treasury Department. The statistics of the Washington post-office show a loss of over $10,000 in registry fees through the extension of the privilege.

LOSSES.

The following will show the classification and number of cases of supposed loss or depredation of registered matter that were reported dur ing the fiscal year to the chief post office inspector for investigation: Losses of first-class matter, 2,731, and of third and fourth class matter, 377; separation or loss from registered package and tag envelopes, 243; rifling of registered letters and parcels, 1,373; tampering with regis tered letters and parcels, 52; wrongful delivery, 98; and detention, 38; a total of 4,912 cases. In 2,615 of these cases the investigations were finally closed, showing that 2,115 had been properly delivered or satisfactorily accounted for and that 500 had resulted in actual loss. Of the latter cases 350 were shown to have been due to unavoidable casualties, such as the burning of mail pouches and postal cars, highway robbery, the burning or burglary of post-offices, &c., leaving only 150 cases chargeable to the negligence or dishonesty of postal employés.

With relation to the casualties during the year, 588 registered pieces were lost or destroyed by railroad accidents, resulting generally in

the burning of postal cars; 459 post-offices were robbed by burglars, and 256 were destroyed by fire.

Statistics more in detail in reference to this subject will be found in the report of the chief post-office inspector. The latter officer, upon the suggestion of this office, has established records to show more specifically in future the nature and extent of the losses due to the various

causes.

INNER REGISTERED-SACK EXCHANGES.

A valuable adjunct to the system of registered-pouch exchanges has been provided by the introduction of a plan of inclosing within ordinary locked mail-bags small sacks of registered matter at designated points on the line of railway mail service where hand-to-hand receipts for such sacks cannot be obtained. By this plan, when an inner sack leaves a terminal office, the postal clerk will receipt for it as a hand or single piece, and upon reaching the railway station nearest the point of deflection he will inclose it, with a registered package receipt, to be signed and returned to him by the postmaster, in an iron-locked pouch containing other mail matter destined to the post-office at such point. Postal clerks are thus saved the labor of entering, indorsing, and checking the several individual pieces, and of preparing separate regis tered-package receipts to go with them. The plan also relieves the postal clerks by restricting their responsibility; and as only dispatching and receiving clerks see and handle the registered package envelopes, the possibilities of loss or tampering are correspondingly lessened. The increased security does not apply alone to registered matter addressed to the original point of destination, but extends also to matter going to more distant points, whether supplied by railroad or by star service. The immer sacks in use are of special pattern, secured at the mouth with special brass clasps, and locked with the tell-tale or rotary locks in use for the through registered pouches. One of the great advantages to be secured by the new plan comes from the large number of offices to which it can be extended, and to which the rules essential to the security of the regular through pouch system cannot be made applicable. The order carrying the new system into immediate effect, with appropriate regulations for its government, was issued by you under date of September 21, 1885, the necessary equipments having been previously provided. The benefits arising therefrom have already been sufficiently demonstrated to warrant the extension of the system greatly beyond its present limits.

MANIFOLD COUPON BILLS FOR THROUGH REGISTERED POUCHES.

This system of billing and recording, inaugurated during the last fiscal year, has proved to be a complete success. The substitution of manifold writing by the use of carbon paper for old press-copy methods permits of later closing of the registered mails, and through the device of a coupon receipt, to be returned to the dispatching office, the original bill can be retained at the receiving office, whereby the labor of transcribing and the danger of errors are avoided. Blank spaces are also provided on the new forms for signatures of clerks handling and transferring different classes of registered matter, thus fixing individual responsibility. Over 500,000 through registered pouch bills are used annually, and the saving in clerical labor, convenience, and cost of records by the new system aggregates a considerable item.

After a long correspondence with the general post-office of Great 6755 PM G—— 45

Britain an agreement was reached by which the manifold coupon bill was substituted for Postal Union forms in dispatching registered matter to all of the different exchange offices of Great Britain. By this substitution our exchange offices receive direct and positive acknowledgment for all registered matter exchanged. The saving in clerical labor is also a considerable item.

REORGANIZATION OF REGISTRY DIVISIONS IN THE LARGER POST

OFFICES.

In order to fix individual responsibility at different stages of working the registered mails, institute daily balances of registered pieces, and provide conclusive evidence in case of loss, the work has been commenced of introducing in the twenty-five principal post-offices the system which has proven so successful in the registry divisions of the New York and Chicago post-offices; adapting the forms, records, and methods to the special requirements of each office.

THE INTERNATIONAL THROUGH REGISTERED-POUCH SYSTEM.

This system has been extended by the addition of exchanges under international rotary lock of through pouches between Detroit, Mich., and Windsor, Canada; Port Huron, Mich., and Sarnia, Canada; and Chicago, Ill., and Windsor, Canada. Twenty-four hours of delay has been saved for all registered matter passing between the western section of the United States and the eastern and central sections of Canada. This extension greatly enlarges the system of exchanges between the two countries, inaugurated to take effect on January 1, 1882, and fully explained in my report for the year ended June 30 of that year.

The system was designed to increase the security and facilitate the dispatch of international registered matter, and it has accomplished important results in both directions. The matter had previously been dispatched by circuitous routes, and was operated by methods foreign to those governing the treatment of domestic matter in transit. Over portions of the routes the registered mails were not in the special custody of a postal employé, as contemplated by the fundamental idea of our system. From Montreal, Canada, to Saint Albans, Vt., the registered pouches, fastened with lead seals, were sent in a United States bonded car. From Saint Albans, Vt., to Saint Armands, Canada, in the opposite direction, they were placed in the compartment of a car and locked with an iron lock. The connections were irregular and uncertain, often leading to great delays. These delays and the insecurity of the system led to frequent and well-founded complaints. Besides other misadventures, an entire registered mail was lost on the Canada side of the border in 1880, and no trace of it could subsequently be found.

The new system was arranged, after repeated failures by correspondence, through a personal conference at Montreal with representatives of the Canadian service. The new plan was modeled upon the general features of our through pouch-system, which had not been in use in the postal service of Canada. Each country was to furnish its own equip ment, including the tell-tale or rotary lock just previously adopted in this country. The dispatches were to be direct and regular.

To illustrate the economy of time under the new arrangement, to say nothing of increased security, the previous time from New York to Montreal was reduced from 58 hours and 25 minutes to 24 hours and 50 mingtes, a saving of 33 hours and 35 minutes; and from Montreal to New