Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1909-12-27
Annual Report Of Post
master Gen, Hitchcock.
Began Year With a Deficit
Tota|ing STATISTIC.
Causes Of the Big Loss and How
To Avoid Repetition.


This was the largest deficit in the his
tory of the postal service. 5" long as
the deficit in the department agSrcgat-
ed only Il few millions Of dollars an
nually, little attention was paid to 1t;
but when, in the last few years, IL
leaped to upward of $1o000,ooo, ana
finally in 1909 exceeded $17,0oo,0oo,
"urdinary business prudence suggested
that the causes be definitely located
These are statements in the annual
report of Postmaster General Frank II.
Hitchcock made public today. Con-
corning the results of inquiries into
the deficit, the Postmaster General
says:
Recent Investigations have shown
that the two great sources of loss to
the postal revenues are Second-claSS
mail matter and rural delivery.
The loss on second-class mail mat
ter has been increasing for many
years, until it now amounts to $64,
100000.
"rhe loss from rural delivery, a ser
vice begun hardly q dozen years ago
and of unprecedented growth, reaches
as high as twenty-e eight millions.
I'm these two items alone the postal
service now suffers an annual loss of
more than the entire national deficit of
the last fiscal year
simultaneously with the growing
deficit in the postal service, the ma
TONS income suffered last year
serious depletion incident to the finan-
cial depression. Thus it happened
that the departments drafts on the
treasury We're heaviest at a time when
the public funds We're lowest. This
has acccntuated the Importance of the
postal deficit making it conspicuous
among the losses to be met by the
Presidents plan of reducing eXpendi-
lures in all executive departments.
Since the opening of the admins
tration the Postmaster General and
his assistants have adopted measures
in conformity with the Presidents
policy of retrcnchment. and these
measures are being put into effect with
substantial results, as will be shown
in this report.
1T should be stated with emphasis,
however, that economy is not to be
enforced at the cost of efficiency.
only such measures OF economy
will be adopted therefore. as can be
made Il consistent part of a general
program having for its chief object
the Improvement of the personnel, the
form of organization. and the business
methods of the postal establishment.
The most striking fact disclosed by
recent Investigations is the tremen-
dous loss on account of second-class
mail. While this class of mail pro-
videS q revenue of little more than 1
| cent a pound, the cost to the govern
ment for its handling and transporta
ton averages 9.23 cents a pound. The
annual loss thus incurred, as already
stated is about $64,o0O,o00 The
growth in the quantity of second
class matter sent through the mails
has been extra ordinary. Since the
passage of the act of 1879 prescribing
conditions under which publications
may be mailed at second class rates
the weight of such matter has in
creased more than 1900 per cent Last
year it amounted to over 500, 0O0, 900
pounds. BY the weighing of 1907
second-clasS matter was shown to
constitute 63 per cent. of all domestic
mail, and yet it yielded only about
per cent. of the postal revenues. The
loss on second-class matter was
greater than the profits on all classes
of mail combined. 1t exceeded the
total amount paid the railways for
mail transportation.
Magazines and other periodical
publications exclusive Of daily news
papers comprise about 60 per cent. of
the second class mail, The magazines
alone form about 20 per cent. Maya
zines proper, because Of the long
average haul show a cost of more than
5 cents a pound for transportation,
while in the case of daily newspapers
for which the average distance Of dis
tribution is much less, the transporta-
ton cost is under cents pound.
"The annual loss on third class mail
is something over three million dol
lars. The mail matter carried free
under congressional franks cost the
Government annually about half
million dollars. A greater loss, about
two and a quarter millions annually,
results from the free handling of Of
fetal mail for executive departments
other than the Postoffice Department.
The annual cost of handling the free
official mail of the Postofficc Depart
ment is estimated at about $4,000 900.
Ii the several branches of the Federal
Government were made to bear their
proper share Of the expense of trans
porting and handling official mail,
greater care would be taken no doubt
in the exercise of the franking prvi-
lege and some saving to the Govern
ment would accordingly result. The
wisdom of doing away entirely with
the franking privilege or official mail
has been suggested, but this is a mat
ter for Congress to determine Such
g plan would relieve the Postoffice
Department Of heavy expense it is
now obliged to incure in the handling
of free mail for other branches of the
government establishment.
"'rhe Rural Delivery Service has de-
veloped in twelve years from an ex-
pertinent, requiring an appropriation
of $4,000, to one of the largest
branches of the postal establishment,
with an annual expenditure exceed
ing $35,000,000. The postage on mat
ter mailed on rural routes is estimat-
ed at about $7.0O0,000. The Importance
of this service to a large number of
people is fully appreciated. 1t brings