The operations of the Navy during the year and its present condition are fully exhibited in the annual report from the Navy Department.

Suggestions are made by the Secretary of various improvements, which deserve careful consideration, and most of which, if adopted, bid fair to promote the efficiency of this important branch of the public service.  Among these are the new organization of the Navy Board, the revision of the pay to officers, and a change in the period of time or in the manner of making the annual appropriations, to which I beg leave to call your particular attention.

The views which are presented on almost every portion of our naval concerns, and especially on the amount of force and the number of officers, and the general course of policy appropriate in the present state of our country for securing the great and useful purposes of naval protection in peace and due preparation for the contingencies of war, meet with my entire approbation.

It will be perceived from the report referred to that the fiscal concerns of the establishment are in an excellent condition, and it is hoped that Congress may feel disposed to make promptly every suitable provision desired either for preserving or improving the system.

The general Post-Office Department has continued, upon the strength of its own resources, to facilitate the means of communication between the various portions of the Union with increased activity.  The method, however, in which the accounts of the transportation of the mail have always been kept appears to have presented an imperfect view of its expenses.  It has recently been discovered that from the earliest records of the Department the annual statements have been calculated to exhibit an amount considerably short of the actual expense incurred for that service.  These illusory statements, together with the expense of carrying into effect the law of the last session of Congress establishing new mail routes, and a disposition on the part of the head of the Department to gratify the wishes of the public in the extension of mail facilities, have induced him to incur responsibilities for their improvement beyond what the current resources of the Department would sustain.  As soon as he had discovered the imperfection of the method he caused an investigation to be made of its results and applied the proper remedy to correct the evil.  It became necessary for him to withdraw some of the improvements which he had made to bring the expenses of the Department within its own resources.  These expenses were incurred for the public good, and the public have enjoyed their benefit.  They are now but partially suspended, and that where they may be discontinued with the least inconvenience to the country.

The progressive increase in the income from postages has equaled the highest expectations, and it affords demonstrative evidence of the growing importance and great utility of this Department.  The details are exhibited in the accompanying report of the Postmaster-General.