true, were, upon the adoption of the rules in September, 1891, required to submit to examinations in competition with outsiders, but as proven capacity in the management of men, gained by experience in their places, necessarily counted for much in their examinations, most of these foremen retained their positions. The result, therefore, was that the new system began to operate with a very decided majority of foremen, quartermen, leading men, and other employees in place belonging to one political party.

These considerations were very earnestly and repeatedly pressed upon me in 1893 as reasons why I should disregard the rules, or at least abrogate them, until the representation of political parties in the yards should be equalized. It was contended, too, with much show of truth, that laborers of the party to which I belonged, believing the rules to be but a sham, had failed to register for places. I did not fail to see the force of these arguments; but, on the other hand, it was to be considered that if such a system was ever to be in force it must have a beginning, and that if the first Secretary coming in after the adoption of rules against which the only objection was present inequality of political representation should attempt equalization from his standpoint every succeeding Secretary would have excuse for taking his bite at the cheese, and so the prospect would be that the whole system would be eventually nibbled away to nothing. It was therefore determined, with your full concurrence, that for the good of the Government the system should be adhered to, and this course has been pursued faithfully.

A very few foremen have been discharged, and they only for good cause, their places being filled by competitive examination. Experience has, of course, suggested some betterments. One of these was the adoption of a rule similar to that which has long obtained in the Civil Service Commission, that names should not remain on the lists subject to call for more than a year. This has, of course, in the time that has elapsed, removed whatever cause there might once have been for the complaint that the registration lists were blocked by applicants mostly from one political party. The one-year rule was obviously for the interests of good administration, as the calling in of laborers long on the rolls resulted in many delays because of the deaths, changes of residence, etc., of those to whom notices were sent.

The changes in the force during the past four years incident to discharges for cause, dropping for want of work, and taking on through the labor board, have gone very far toward equalizing the representation of political parties, and if the system shall in the future continue to be enforced with any degree of firmness there can never be so loud a call on any Secretary for the abrogation or mutilation of these rules as that which assailed your Administration in 1893.

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Other important betterments have been made, viz: Until recently, though persons with navy-yard experience were preferred over all others, except veterans, the rules made no distinctions among those whose records had been "satisfactory." The Department, therefore, ordered that whenever an employee was discharged his workmanship and conduct should be marked "excellent,' ' good," or "poor." "Excellent" gives preference next after veterans, who are always preferred applicants; "good" allows reregistration without preference; "poor" deprives of registration for one year. This rule incites to diligence and it secures to the Government the best laborers. Employees whose workmanship and conduct were marked "excellent" are also given the additional privilege of being furloughed for limited periods instead of being discharged when, by reason of want of work at any navy-yard, it becomes necessary to reduce the force. These changes, insuring steady employment to the best laborers, are producing admirable results.

If there be any point at which the Government of the United States is entitled to the very best service that can be had, where men should get work because they are capable of doing it, and should retain employment only because they discharge their duties faithfully, it is in the navy-yards, where ships are built and repaired that are to go forth on the high seas freighted with precious lives and carrying the flag that symbolizes the might and majesty of our country. There can be no comparison between a navy-yard system that holds out every inducement to good conduct and excellence in workmanship and another in which a controlling consideration in the procurement of work and the retention of place is political influence. Every naval officer whose duties have brought him during the past six years in contact with the laborers at our Government yards will, I am sure, testify to the immeasurable superiority of the present over the old system. To the maintenance and betterment of this system I have devoted much of my time and thought during these four years, in the earnest hope that the labors of Secretary Tracy in this behalf, supplemented by my own, will result in ingrafting it permanently in the service of the naval establishment.

On May 6, 1896, the President extended the civil-service rules to cover all employees at navy-yards whose duties are in whole or in part of a clerical nature, or who are serving in the capacity of watchmen or messengers, and appointments to such positions in navy-yards can now only be made after examination and certification by the Civil Service Commission.

On the 29th of July last the Civil Service Commission adopted the following resolution: Whereas the enforcement by the Secretary of the Navy of regulations governing the employment of labor at navy-yards having been shown to be highly useful, and it being important that they should be given stability independent of changes of Administration, and it appearing that the examinations and other tests of fitness provided by these regulations are based on the principles that personal fitness should prevail over recommendation, and that political influence should be disregarded, it is Ordered, That these regulations be, and they are hereby, adopted as the regulations of this Commission under the authority conferred by clause 1 of rule 1. (Minutes of July 29, 1896, clause 4.)

And the following Executive order was promulgated November 2, 1896:

The regulations of the Navy Department governing the employment of labor at navy-yards having been adopted by the Civil Service Commission as a regulation of the Commission July 29, 1896, under the authority conferred by clause 1, rule 1, of the Revised Civil Service Rules of May 6, 1896, it is hereby ordered that no modification of the existing regulations shall be made without the approval of the Civil Service Commission.

EXECUTIVE MANSION, November 2, 1896.

GROVER CLEVELAND.

[From the report of the Superintendent of Indian Schools, 1896.]

It's a matter of congratulation that civil-service rules have recently been extended over the entire school service. This will do away, thoroughly and permanently, it is hoped, with the baneful influences of patronage, concerning which I have had frequent occasion to report to you, and it will establish in every department of the work the rule of efficiency and character as the only criteria both in appointment and in tenure.

Among the evil influences of patronage which may linger for some time in the service the most troublesome is the false relation between superiors and inferiors in the corps of employees. Under patronage, authority is apt to lose the elements of official courtesy and to assume the garb of a more or less offensive autocracy. On the other hand, loyalty on the part of inferiors is apt to degenerate into self-seeking subserviency to the wishes of the autocrat and to give rise to factionalism with its attendant dishonesties. The character of the schools as a whole warrants me in the statement that in the great majority of schools these dangers had been reduced to a minimum, even before the promulgation of the civil-service order, by the good sense, integrity of purpose, and kindly disposition of those concerned. I am therefore justified in predicting that with patience and vigilance the office will succeed in a comparatively short time in banishing from the service every vestige of autocratic offensiveness on the part of superiors and of self-seeking subserviency on the part of inferiors as well as all other demoralizing after effects of a system of patronage which, fortunately, is now a thing of the past.

Some difficulty may be experienced in providing suitable examinations for some of the minor positions and in obviating needless hardship and exposure to employees with reference to examinations for promotions. In my conferences with the Civil Service Commission upon these points I have submitted feasible and practical plans for meeting these difficulties and have reason to hope that these plans will be substantially adopted and will be in operation before this report reaches you.

I would again invite your attention to the fact that my efforts to direct important details of the school work are still greatly hampered because only three supervisors are placed at my command. I understand that this is due to the lack of funds at your disposal. In order to enable me to satisfy fully the many requirements of my office, at least five supervisors are needed. These could be placed in permanent charge, respectively, of five districts, so arranged as to enable them to visit the different schools in these districts with such frequency as to see that the instructions of the office are intelli. gently considered in the work of the schools.

On the other hand, it is a subject for congratulation that the position of supervisor has been placed under civil-service rules, and that, in making selections for vacancies, it will be possible to promote to this position experienced and tried superintendents. I am pleased to learn that steps are in progress to secure a sufficient increase in the salaries of supervisors to justify both the Department and superintendents whose selection for this purpose is desirable to effect the promotion involved.

[From the report of the Postmaster-General, 1896.]

From an organization of 75 postmasters in the first year of Washington's Administration, and a mail service costing $32,000, confined to the carriage of letters, the Post-Office Department has grown to an organization of over 70,000 postmasters, and a service costing $92,000,000, open to the transmission of almost all kinds of matter, with limitation of weight only, and has become an integral part of the organized postal system of the world. Surely the time has come when the best business organization should be adopted in the administration of the Department, and a larger extension of the civilservice methods in the selection of employees, upon whose faithful, strenuous, and intelligent labor, rather than political qualifications, must be based the high and efficient service for which the people annually pay such immense sums. How these results may be accomplished by an easy and natural development, I beg leave to give my own views in the following extracts from a letter I addressed in February last to the Hon. E. F. Loud, chairman of the House Committee on the Post-Office and PostRoads:

There are now 3,613 first, second, and third class post-offices in the United States, whose postmasters are appointed by the President, by and with the advice and consent of the Senate, and 66,440 fourthclass post-offices, whose postmasters are appointed by the Postmaster-General, making a total of over 70,000 independent post-offices. Each of these 70,000 offices occupies an independent footing in its relation to this Department; for each office a separate account must be carried on the books, returns examined and straightened out, requisitions for post-office supplies scrutinized and allowed, and official instructions given from Washington; all of which involves a voluminous system of bookkeeping and a heavy correspondence by a large clerical force. It is clearly impossible to manage 70,000 offices in so large a country as this from one central office so as to enforce diligence and accuracy in their management, with a proper accounting for public funds and an efficient service of their respective patrons. Clearly, no other business of such magnitude would be conducted with so loose an organiza

tion. It is, in some respects, as if each private soldier in a great and growing army reported directly to the commanding general, received orders from him, and had little other supervision than what was possible from army headquarters. The corps of inspectors of the Post-Office Department are in a certain sense the personal staff of its head, but are not numerous enough to make a personal inspection of post-offices, even if they were not charged with other multifarious duties, in less than two or three years of systematic work.

Some of my predecessors have called attention to this lack of organization of our postal service and suggested a more compact and responsible system, such as the distribution of the country into postal districts under the management of officials subordinate to the Postmaster-General. I beg leave to quote from the last annual report of Postmaster-General Wanamaker, summing up his mature views after four years of experience in managing the Post-Office Department:

"In my first year in this office I went before the Post-Office Committee and urged consideration of the plan to divide the postal service into districts upon a real business basis, stating that, if I were asked what one thing would most benefit the system and what of all the proposed reforms I most desired, it would be the reorganization of the Department into districts, to be supervised by trained postal experts.

"The present cumbersome, costly, scattering system will be displaced by a less political and less wasteful structure, and one more coherent, decentralized, and businesslike. "Briefly, the plan is to divide the whole postal territory into a certain number of districts, say 100. Each district would be put in charge of a postal supervisor or director, and the regular inspectors of the Department should assist these supervisors, as they might be needed, in depredation work. Then all detail matters relating to the establishment and discontinuance of post-offices, the establishment of stations, appointments, and removals, the best utilization of and changes in routes, the putting on and taking off of the service, the right interpretation of the regulations, irregularities, and, in general, the whole business conduct of the service would be superintended personally by the district supervisors, with the assistance, as suggested, of the regular inspectors, when required, and with the support, of course, of all the postmasters in the district, who would feel, as never before, that their efforts on behalf of the adequate facilities and economical and enterprising management would find appreciation. The district supervisors could act under rules without reference to the Department atWashington and without useless delays; they would be the counselors of the Department, the gent eral medium of communication with it, and the First Assistant Postmaster-General should be consen tuted the comptroller or actuary to whom the supervisors should report. The Members of Congress would find themselves relieved of no end of disagreeable departmental drudgery, and the Department would come directly in touch with the postal employees, and they, in turn, would be better in touch with the people served.

"The Pension Bureau and the Internal-Revenue Office are operated by districts. [The district system is common in Germany and other European countries. It is necessary for the prevention of delay and the consequent speedy rectification of shortcomings. It is almost inconceivable that the analogy of the railway mail divisions and of the divisions by districts so successful in foreign countries should never have been generally followed out in this. Fancy a great railway or a business enterprise of any sort-telegraph companies or the press associations-with only one bureau of reference. It is absurd."

My immediate predecessor, Mr. Bissell, in his last annual report, reiterated his recommendations of his report for 1893, which were as follows:

"I think that any business man assuming charge of the Post-Office Department feels the weakness of its organization at one point, and that is in the relation of the heads of the Department to its postmasters and other local officers. There are nearly 200,000 persons now employed by the Government in its postal service, and only in the Railway Mail Service is there any real attempt at organization. As a general proposition, it may be said that this great army is organized in companies, without regiments or brigades, so that the company captain makes his report to the general commanding officer; or, in railroad management, it would be like organizing a company with a president and four vicepresidents, but without superintendents, either general or local, the station agents making their reports directly to the one or the other of the general officers.

This is a strange anomaly, and is without parallel in any business institution that I have any knowledge of. Indeed, inspections of the service and reports thereon are rarely made or rendered unless upon complaint being lodged.

"I would have an officer superintending the postal operations of each State. He should be expert in postal affairs, and should assist new postmasters on their assumption of office and instruct them in their duties. The post-office inspectors should cooperate with him in the detection of frauds and in the punishment of crimes against the postal laws. He should make frequent visitations to all the postoffices in the State, and report their condition to the proper officer of the Department in Washington. As his duties would consist largely, almost entirely, in fact, of supervising the postal affairs and the work of postal officers, his position should be in the classified civil service."

The

Fortunately, the natural growth of the country, and the consequent development of the postal service, has suggested a plan which, by the test of experiments already made, promises to effect this substantial improvement, without further legislation than an increase in the allowance for clerk hire, more than counterbalanced by a still larger decrease in the appropriation for the salaries of postmasters. This plan contemplates the consolidation of smaller and contiguous post-offices with the free-delivery offices. Such consolidation is constantly made necessary as our growing cities and towns overlap adjacent suburban communities and districts heretofore served by independent offices. smaller post-office is made a station or substation of the central office. Beginning with the offices in immediate contiguity with the central offices, it has been found expedient to enlarge the circumfer ence of consolidated offices gradually, with such results in economy of expenditure, improvement of administration, and increase of postal facilities to patrons as to demonstrate beyond question that the larger and more important post-offices of the country can be made, and should gradually be made, the nuclei, or centers of administration, for quite an area of surrounding country in each case. A few days ago an order was issued from this office consolidating with the Brooklyn post-office 14 independent post-offices hitherto existing in the corporate limits of that city. Every post-office on Long Island Sound might thus be consolidated with the Brooklyn post-office, with an improvement of the service.

I submit herewith an exhibit showing the result of the consolidation of 94 offices during the fiscal year 1894-95, and the substitution of 74 stations therefor in charge of clerks. As a result of such consolidations, we have now largely increased postal facilities for the patrons, largely diminished expendi tures for the Department, and a far more vigilant and effective administration and supervision of the stations from the local central office than was possible from the Department in Washington. Ninetyfour separate accounts, with all the correspondence which they involved, have disappeared from our books, and a prompter and more businesslike and responsible accounting to the Department has fol lowed. The average saving of expenditure on these 94 offices, in the salaries of superintendents and

clerks substituted for postmasters and clerks, is $354. For 20 offices consolidated with the Baltimore post-office (some of them at considerable distance from the city limits) the postmaster at that city reports a decrease of expenditure of one-third, an increase of revenue of one-eighth, and, in some cases, a doubling or quadrupling in the number of mails received.

If the average saving upon each office resulting from the consolidation of the 94 offices above referred to be taken as a basis, it would show, for 2,000 offices, an annual saving of nearly threequarters of a million dollars; but, without claiming that such average could be maintained, it is demonstrated beyond question that a very large annual reduction of expenditures, reaching to millions of dollars, is possible in the future from the steady and progressive consolidation of smaller and contiguous offices with the larger central ones. This consolidation is effected by order of the Postmaster-General, after a careful collation of all necessary data in the Department. No change or obliteration of name of the office consolidated is necessarily made; but in place of the independent post-office reporting to, and managed from, the Department at Washington, it becomes a station in charge of a superintendent, or clerk, reporting to, and managed by, the office with which it is consolidated. The salary formerly paid to the postmaster, who, in many instances, gave but part of his time to the duties of his office, is abolished, and the clerk in charge of the station is paid from the allowance for clerk hire. It will thus appear that the amount appropriated for clerk hire limits the number of consolidations possible for the Postmaster-General, because every such change, while it lessens the expenditures of the Department, changes the fund from which payment is made from the appropriation for salaries for postmasters to the appropriation for the payment of clerk hire. Summing up the advantages of such consolidation of offices, I would say that

First, it strengthens and improves the postal organization, by introducing, through a natural and easy development of the existing system, competent local supervision, responsibility, and control. Second, it lessens, by a large amount, the necessary expenditure for the postal service, with the certainty that this decrease will gradually swell into millions of dollars annually. Third, it improves and increases the postal facilities of the people, which, in turn, Fourth, improves and increases the revenue of the Post-Office Department.

Fifth, it insures a prompter and more intelligent accounting for public funds with less bookkeeping, less correspondence, fewer requisitions for supplies, and less call for inspection from the Department. Sixth, it calls for no legislation, and no increase of postal officers.

Seventh, it increases gradually the number of offices and officials under civil service, and thus, among many advantages, insures a better and more businesslike management.

My specific recommendation, therefore, is that a sum, say $2,000,000, be taken from the appropriation for the salaries of postmasters, and that in place of this an increase of $1,500,000 be added to the appropriation for clerk hire.

In further support of the statements made in the above letter, I may add that during the fiscal year 1896, 55 post-offices of the second, third, and fourth classes were discontinued and 54 stations and substations established in their place. The result was a saving of $17,948 in salaries and allowances of the discontinued offices, a sum sufficient, with the addition of $1,160, to give free delivery within the 30 square miles added to Brooklyn and to a considerable territory added to New York.

The Railway Mail Service has been steadily advanced by the addition of post-office cars, an increase of clerks, and a marked improvement in the speed and accuracy of working the mails. The separation of not only all first-class matter but of almost all the newspaper mail before reaching the cities makes possible an immediate delivery by carriers after the arrival of trains.

On the 30th of June, 1896, mails were carried on 172,794 miles of railroad, and 6,779 postal clerks were employed on 152,825 miles, including steam, electric, and cable cars.

The number of pieces of ordinary mail matter distributed by the Railway Mail Service during the year was 11,166,323,240, an increase over the previous year of 788,448,200, while there was a decrease in the number of errors made of 32,270. But one error was made for each 9,843 pieces distributed, as against one in every 2,834 in the fiscal year 1890, and one in every 8,894 last year.

In this connection I beg leave to call attention to the following table, giving the number of pieces distributed, the number of errors in distribution, and the number "correct to each error" for each year from 1884 to 1896, inclusive, not only to show the steady improvement in the service, but to show how constant and marked that improvement has been since the clerks were put under civil-service rules. It will be recalled that wholesale discharges of postal clerks were made on political grounds near the close of the fiscal year 1889, the effect of which appears in an increase of nearly 1,000,000 errors in 1890 and the large falling off in the number "correct to each error.' In no branch of the postal service has civil-service reform shown such good results as in the Railway Mail Service.

The Post-Office Department is by preeminence the business department of the Government. It is also the familiar servant of all the people. In the performance of its allotted work it visits daily the homes of millions of them and the immediate neighborhood of almost all the other millions. Any interruption of its work or temporary cessation affects many with anxiety and others with loss. It can not stand still, even for a few days, without neglecting some opportunity or missing some means of adding to the fullness and effectiveness of its service. It is therefore indispensable that it should be run on enlightened business principles, and that its chief officials should each be thoroughly acquainted with the special field of service or organization committed to him, and able and prompt to adopt every facility which the growth of our population, the extension and perfection of our transportation systems, the march of inventions, or the experience of other countries may put at his disposal.

I believe that in this, my last report, I can truthfully affirm that the heads of the several bureaus of this Department have manifested this ability and have done their work in this spirit, and that as a consequence the United States postal service, with all the drawbacks of defective laws and an outgrown organization to which I have referred, was never so efficient as it is to-day. With the gradual inclusion of its employees in the classified civil service, in which reform the President's order of May 6, 1896, has made another step, it is becoming less and less a political machine and more and more a strictly business establishment. To complete this reform, two more advances are necessary:

(1) To secure fixity of tenure during efficiency and good behavior to the three Assistant PostmastersGeneral, whose work is entirely nonpolitical, whose capacity to deal with the large machinery and great expenditures of their respective bureaus must come in great measure from experience, and who preserve the continuity of the Department not in mere desk or division work, but in general administration. It is safe to say that the proper training of a bureau chief, up to the point where he may have a vigorous grasp and accurate knowledge of his duties, is a very costly thing for the Government.

(2) To cover into the civil service as many as possible of the postmasters themselves. The 70,000 or more postmasters are now the chief spoils of an incoming Administration. Under the present system these officials are too apt to think that their obligation to party is higher than their duty to the public, and that the zeal and activity with which they meet that obligation is a surer guaranty of continuance in office than any like zeal and activity for the public service. To this belief I am sure is traceable the excessive and occasionally reprehensible partisan activity exhibited by many postmasters during the late and during preceding Presidential campaigns.

After another year's experience at the head of the service, and much reflection on this difficult matter, I am the more convinced that the plan of consolidating offices, outlined and recommended in this report, is the most feasible method yet devised of bringing post-offices within the classified service, especially as it is still more the most feasible plan for improving the business organization of the Department.