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largely on the presumption that a majority of the publications of fered for mailing would receive what is known as “general delivery service.”. It can be seen at a glance that in respect to cost it is one thing to handle mail through the general delivery, and another thing to give it the service called for by the establishment of a free-delivery system in our cities and towns and on the new rural routes of the country. Another feature of the case merits careful consideration. Since 1885 there has been an enormous increase in the cost of everything that enters into the economy of the postal service. I venture to say that the rate of 1 cent a pound in 1885 meant as much to the Department as a rate of 3 cents, a pound would mean in 1906. But some publisher may say that the increase in prices has also affected the publishing trade. Under ordinary conditions such would be the case, but the numerous inventions which have been introduced into the printing business in twenty years, the immensely greater volume of circulation publishers have gained through our rapid increase in population, has enabled them to produce their publications at a figure much below the cost of production in 1885. Every item in the printing business, except labor, costs less now than it did then, and the increase in the cost of the latter has been offset by the relatively cheapened price of composition, made possible by the invention of typesetting machines. On the other hand, there has been no such revolution in the business economy of the Post-Office Department. Labor, which is the principal item in its expense account, costs immensely more than it did twenty years ago, and its transportation bills have likewise increased enormously, on account of the greater distances it is required to transport the bulk of mail which i. Were it not for the fact that the postage of first-class matter yields a very large profit over and above the cost of handling and transportation, the deficit would be so great as to compel an immediate and radical change in the rate of postage on second-class matter. Now, this is another phase of the question to which I will briefly refer. From the standpoint of the local service the necessity of increasing the postal revenues can not be overestimated, and I presume that this would also be true of the majority of post-offices in the country. Everybody familiar with the postal work knows that the backbone of the service is the skilled distributor, the man whose mastery of the difficult schemes enables the post-office to send the mail forward rapidly and correctly to the points where delivery is to be effected by the letter carrier or the general-delivery clerk. Without the skill and faithfulness of the distributors it is impossible to have a postal serve ice worthy of the name. Yet we find the average salary paid to skilled employees by a beneficent Government is about $70 a month, or scarcely half of what is paid to a carpenter or a bricklayer in our large cities. I venture to say, too, that it takes as long to train a distributor as it does to train a carpenter or a bricklayer. ...When these men have once learned their business they have very little further study to do, while on the other hand, a distributor is compelled to study constantly and to renew his information almost daily. He not alone receives less pay than his services are worth, but owing to the

Government monopoly of the postal service he has not the chance the bricklayer or carpenter has to carry his skill into other markets where he might demand fair wages for his services.

In the Chicago office this wrong condition of things constantly militates against the best service, for we are all the time confronted with a steady stream of resignations from the staff of distributors brought about by the low salaries, long hours, and the fact that good men can see no prospect of improving their positions. We were threatened not long ago, as you saw by the papers, with the formation of a postoffice union, to work for better conditions and better pay along the lines followed by free labor organizations, but this movement was not permitted to gain headway, because it was felt that the relations of Government employees to the public are different to the relations between private employers and their employees. Still the fact that such a movement was even thought of ought to make those in authority alive to the causes which would make postal employees contemplate such a plan to better their condition. It certainly seems to me that the privilege of mailing second-class matter at a rate less than it costs to carry ought not to weigh in the scale against the right of employees to receive fair wages and to enjoy fair hours. And whether you shut your eyes to the fact or not, the conditions remain the same, that the loss on second-class matter is largely made up by the underpayment of postal employees.

In concluding this phase of the matter, I observe that some good men argue very earnestly for the retention of the second-class "subsidy” and talk fluently about the duty of a free press to disseminate intelligence among a population which would remain ignorant if it were not permitted to read the Weekly Beacon or the Sporting News, but the philanthropy which keeps its eyes fastened on an opening in the National Treasury, and which has no vision for the injustices which flow from the second-class subsidy, is not the kind of philanthropy which appeals to the disinterested observer.

In the foregoing statement I have tried to deal with the subject in an unprejudiced way; have tried to view all sides from the standpoint of experience and the best interests of the public service. I do not pretend to have said the last word on the subject, and no doubt there are important phases of it which I may have overlooked. But in brief I have suggested:

First, in section I: That from the business, practical point of view second-class matter ought to be self-sustaining.

Second, in section II: That a long step toward the solution of the problem would be a law obliging bulk matter to be conveyed outside of the mails.

Third, in paragraph A, third section : That in case neither of the foregoing recommendations is approved a 2-cent-a-pound rate on bulk copies addressed to news agents and news dealers and a 3-cent-apound rate on single copies addressed to subscribers, etc., be adopted.

Fourth, in paragraph B, third section: The abolition of the sample-copy privilege.

Fifth, in paragraph C, third section: The abolition of the transient rate of postage.

Sixth, in paragraph D, section 3: The compulsory routing of second-class mail by publishers.

Finally, in paragraph F, section 3: The passage of a stringent law

to punish those who wilfully violate the statutes governing the mailing of second-class matter. The Vice-CHAIRMAN. Now, Mr. Hubbard, will you be kind enough to take a position at the table here, where you may answer some questions? Mr. HUBBARD. Yes. The WICE-CHAIRMAN. I suggest that if any representatives of organizations present care to ask Mr. Hubbard any questions relative to his paper they may do so at this time. Mr. GREEN. I should like to ask Mr. Hubbard a question. The WICE-CHAIRMAN. Mr. Green, of the Typothetae. Mr. GREEN. Mr. Chairman, I should like to ask Mr. Hubbard a question relative to his statement in his paper that the deficit has increased. I should like to ask him if he has any figures to show what the percentage of the deficit is—how much it has averaged since 1885? Mr. HUBBARD. I have made no comparative figures. That is, they are not set out in this paper. At this point I might say I have said in the paper that very much has been #. through a sane interpretation of the law in the last five years to wipe out some abuses. For instance, if the mandamus proceedings brought in the suit against the Postmaster-General, I believe in 1901, had been successful upon the side of the publishers, who wished to make it mandatory upon him to accept certain serials into the mails as second-class matter, . deficit to-day would be two or three times what it is now, possibly. Mr. GREEN. I do not ask what it would be. I ask if you know how that percentage varies? Mr. HUBBARD. I do not. Mr. GREEN. As a matter of fact, I think you will find that the percentage of the deficit is a great deal less now than it was in 1885. Mr. HUBBARD. Yes: owing to what I have just said. Mr. GREEN. No: I do not think it is owing to that at all. Mr. HuBBARD. Well, we disagree then. The Vice-CHAIRMAN. I suggest that you propound your questions and let Mr. Hubbard answer them. Mr. GREEN. Thank you. I have no other question. The Vice-CHAIRMAN. Any other question ? Mr. GLAsgow. Mr. Hubbard, I understand from your paper—and I have followed it as closely as I could—that the difficulties which you see in the administration of the Department, both in its local offices and elsewhere, very largely grow out of the fact that the carriage of second-class mail is not self-sustaining. Mr. HUBBARD. Yes, sir. Mr. GLAsgow. That is the view, principally, that you present, as I understand. The reforms which you have o to by the Department in its rulings and the sustaining of those rulings by the courts have gone very far to remove the difficulties on the lines upon which those rulings were based ? Mr. HUBBARD. Yes, sir. Mr. GLAsgow. That is true, is it not? Mr. HUBBARD. I should say so. Mr. GLAsgow. Do you think that the efficiency of the Department has reached the end of its tether, in benefiting the service by careful, consistent, and intelligent rulings upon questions which may be presented where difficulties are encountered? Mr. HUBBARD. Well, a full answer to that question should be given by one higher in the authority of the Department than myself. I am a subordinate, and low enough down in the scale, so that I should be careful to say only that which my superiors might think is wise. Mr. GLAsgow. That is not the basis on which we ought to proceed. You and I are entitled to our opinions here. Mr. HUBBARD. Oh, yes. Mr. GLAsgow. And I want to get your views about it, not the views of the Department—— Mr. HUBBARD. Yes. Mr. GLAsgow. Expressed through you. I want your views. Mr. HUBBARD. Just so. Mr. GLAsgow. What I want to know—and I will be perfectly frank in telling you why I want to know it—is this: I recognize what you say as to the beneficent effect of the rulings of the Department which have been sustained by the courts. Mr. HUBBARD. Yes. Mr. GLAsgow. Now, what I want to know is whether that can not be carried further, and whether by a codification of the rulings which become laws a great many of the difficulties now encountered can not be eliminated in that way. You understand ‘what I am after 7 Mr. HUBBARD. I think I understand; but your cure is not there. The Department might have done some things better. It might still do some things better under existing law and conditions. I am not here to criticise the Department. Mr. GLAsgow. You do not understand me as doing so. Mr. HUBBARD. Oh, no. Mr. GLAsgow. I am not criticising the Department, but I am just wondering. It is a matter that I want information upon. Mr. HUBBARD. Certainly, and I am here to give it to you if I can, reasonably. Mr. GLAsgow. Yes: I understand that. Now, I want your opinion whether, if the Department pursues the course that it has so wisely inaugurated, as questions come up, making its rulings, eliminating fraudulent attempts at evasion of the laws, backed by the courts, as it has been in all of its sane rulings, whether that would not go a great extent to relieve some of the difficulties which you have encountered. Mr. HUBBARD. I think if you have followed the argument or statement read by Mr. Glassie you will understand that for me to admit all you would possibly like me to admit would still not cover the ound. We try to cover it in other ways and by other recommenations. Mr. GLAsgow. It would not cover the difficulty of there being a deficit in carrying second-class matter. Mr. HUBiba Rd. No. Mr. GLAsgow. Now, is it your view that every branch of the Department should be self-sustaining? Mr. HUBBARD. I do not see why not, if it can be done. The various classes of matter—necessarily mail matter is divided into classes— Mr. GLAsgow. Yes.

Mr. HUBBARD. And being first divided into classes, it seems to me, in the practical way of doing things, that each class ought to pay for the handling of it.

Mr. Glasgow. That is what you think?

Mr. HUBBARD. The post-office was not instituted as a money-making proposition, but I can not understand really why the merchant who sells shoes should be obliged to pay 16 cents a pound to send a pair of shoes weighing a pound through the mails while the publisher sends his commodity for 1 cent a pound.

Mr. Glasgow. Of course, that is a question of policy.
Mr. HUBBARD. It is in the line of your inquiry.

Mr. GLASGOW. Now, what I want to ask is this: What do you estimate to be the loss in carrying second-class matter?

Mr. HUBBARD. I have never made what I am willing to call a firstclass estimate.

Mr. Glasgow. I mean just approximately.
Mr. HUBBARD. I would say about 5 cents a pound.
Mr. GLASGOW. That would be about $30,000,000.

Mr. HUBBARD. Yes, I take it there. I have taken that figure in computing

Mr. GLASGOW. Then, if the second-class mail matter were self-sustaining, the revenues from it would be about $30,000,000 instead of $6,000,000?

Mr. HUBBARD. Yes.

Mr. Glasgow. That would mean that for the last year instead of there being a deficit in the whole Post-Office Department there would be a surplus of about $10,000,000.

Mr. HUBBARD. So.

Mr. GLASGOW. Do you think that the Post-Office Department ought to make money?

Mr. HUBBARD. Well, now, we come to the consideration of other questions. There are some gentlemen here representing a postal reform proposition (I understand they were here yesterday), and they want a 1-cent postage on letters, you know, and a lot of other fellows want the same thing.

Mr. Glasgow. Yes; but I do not think you ought to work this matter out upon the theory of giving to everybody everything they want.

Mr. HUBBARD. Oh, no; but I say--now this is just my opinion about it-I would like, if we could, to see the various classes of mail matter paying their way through the mails for transportation and delivery. I would then like to see how much money that makes under the present units of weight and postage as assessable upon those units of weight; how much money that would make to the good. Then I would like to have ('ongress look the question over carefully and see who, if anybody, is not receiving enough pay. Now, I am not a sandbagger on the Treasury at all, but there are people in the postal service who are not paid what they should be paid. If there were a surplus I would like to have some of that surplus put into an adjustment, and pay fair wages to men employed in the service, and then take up the question of where the postage should be cheaper, where one class is paying too much, and cheapen the postage. That is what I should like to see, and I do not like to hear 1-cent postage howled about, and the other postage, and so on, until some adjustments are made and we see where we are.

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