Our country has advantages superior to any other nation in our resources of iron and timber, with inexhaustible quantities of fuel in the immediate vicinity of both, and all available and in close proximity to navigable waters. Without the advantage of public works, the resources of the nation have been developed and its power displayed in the construction of a Navy of such magnitude, which has at the very period of its creation rendered signal service to the Union.
The increase of the number of seamen in the public service from 7,500 men in the spring of 1861 to about 34,000 at the present time has been accomplished without special legislation or extraordinary bounties to promote that increase. It has been found, however, that the operation of the draft, with the high bounties paid for army recruits, is beginning to affect injuriously the naval service, and will, if not corrected, be likely to impair its efficiency by detaching seamen from their proper vocation and inducing them to enter the Army. I therefore respectfully suggest that Congress might aid both the army and naval services by a definite provision on this subject which would at the same time be equitable to the communities more especially interested.
I commend to your consideration the suggestions of the Secretary of the Navy in regard to the policy of fostering and training seamen and also the education of officers and engineers for the naval service. The Naval Academy is rendering signal service in preparing midshipmen for the highly responsible duties which in after life they will be required to perform. In order that the country should not be deprived of the proper quota of educated officers, for which legal provision has been made at the naval school, the vacancies caused by the neglect or omission to make nominations from the States in insurrection have been filled by the Secretary of the Navy. The school is now more full and complete than at any former period, and in every respect entitled to the favorable consideration of Congress.
During the past fiscal year the financial condition of the Post-Office Department has been one of increasing prosperity, and I am gratified in being able to state that the actual postal revenue has nearly equaled the entire expenditures, the latter amounting to $11,314,206.84 and the former to $11,163,789.59, leaving a deficiency of but $150,417.25. In 1860, the year immediately preceding the rebellion, the deficiency amounted to $5,656,705.49, the postal receipts of that year being $2,645,722.19 less than those of 1863. The decrease since 1860 in the annual amount of transportation has been only about 25 per cent, but the annual expenditure on account of the same has been reduced 35 per cent. It is manifest, therefore, that the Post-Office Department may become self-sustaining in a few years, even with the restoration of the whole service.