Evening star. [volume] (Washington, D.C.) 1854-1972, 1929-07-09
Contract Prices Would Be
Reduced Under Program
Believed Contemplated.
AMOUNTS TO 1877 MILLION
FOR YEAR ENDED JUNE 80
President Represented as Proposing
Its Elimination in Entirety
if Possible.

Aroused by the steadily increasing
Post Office deficit, which for the year
ended June 80 was $137,000,000. Presi-
dent Hoover is understood to be con-
templating remedies which may involve
reversing the Governments policy rela-
tive to the postal service.
In times past the Government has
recognized that the mail should be car
ried even at a great loss as O public
service. President Hoover is repre-
sented as proposing to make reduced
deficit If not to wipe 1t out entirely, II
that may be possible. He feels that
those who are benefited directly by the
service rendered by the Post once De-
partment should bear the expense and
policies to be adopted by him are ex-
pected to be along such lines.
Mr.. Hoover is known to look upon
the Post Office Department as bust
ness institution rendering a service To
the public. He contends that that
service should be paid for by those
reaping the benefit and not by the tax
payers, as has been the case in the
past.
Air Mall Rate Raise Seen.
The belief is that the Presidents
first step will be reduction in the
contract prices for carrying air mali
and a relative increase in the air mail
rates. The President has authority
to effect these changes without legis-
lation. In the meantime he will con-
duct thorough survey OF the postal
81, &I.o nf dafprr10 iY1iT7O
definitely just where the losses are:
He is satisfied that this great drain
on the Treasury because OF the postal
deficit cannot be checked until it Is
known just where to apply the rem
edies.
This investigation is to be conducted
under the supervision Of Frederic TIL
ton, nationally prominent public ac-
countant, who recently was appointed
Third Assistant Postmaster General
| The President is represented as feeling
confident that this expert will have no
difficulty in putting his finger on the
weak spots in the service and recon-
mending corrections.
The Presidents concern regarding
this department has been aroused by
figures recently presented to him by
Postmaster General Brown. They show
that the postal deficit for the past six
years mas Oeen as 1OllOWS. III 1S&4,
$13 900 900; in 1925, $23 ,00o,0 900; in
1926, S39,000,0 900; in 1927, $4,000, 900:
in 1928, $32,000,000, and in 1929, $685.
100000
Claim Increases Deficit.
The $95,000,O0O deficit for the year
;ust ended did not include the $42 900, :
600 the department must pay, accord
ing to ruling of the Court of Claims,
to carriers, a claim which was contested
by the Government. This makes the
deficit for the present year $l37, 900 ,000
The President has figured that at the
rate the postal service has been run
ming behind, the average deficit for the
next five years may be $85,000,000 a
year. This does not include the public
buildings program for the postal service
for that period, which the President
feels should be included. Therefore
with the public buildings program in
cluded, he figures the annual deficit fol
the next five years at $l20,000,000 a
year.
The growing postal deficit, according
to those who have discussed the sub
ject with the President, arises largely
out of legislation during the past six
years. Some of this legislation has
brought about large increases in pay fol
employees and for salaries of postmas-
tiers. These new items for increased
pay amount to 100000