This subject is one of the utmost importance to the national welfare.  Methods of reviving American shipbuilding and of restoring the United States flag in the ocean carrying trade should receive the immediate attention of Congress.  We have mechanical skill and abundant material for the manufacture of modern iron steamships in fair competition with our commercial rivals.  Our disadvantage in building ships is the greater cost of labor, and in sailing them, higher taxes, and greater interest on capital, while the ocean highways are already monopolized by our formidable competitors.  These obstacles should in some way be overcome, and for our rapid communication with foreign lands we should not continue to depend wholly upon vessels built in the yards of other countries and sailing under foreign flags.  With no United States steamers on the principal ocean lines or in any foreign ports, our facilities for extending our commerce are greatly restricted, while the nations which build and sail the ships and carry the mails and passengers obtain thereby conspicuous advantages in increasing their trade.

The report of the Postmaster-General gives evidence of the satisfactory condition of that Department and contains many valuable data and accompanying suggestions which can not fail to be of interest.

The information which it affords that the receipts for the fiscal year have exceeded the expenditures must be very gratifying to Congress and to the people of the country.

As matters which may fairly claim particular attention, I refer you to his observations in reference to the advisability of changing the present basis for fixing salaries and allowances, of extending the money-order system, and of enlarging the functions of the postal establishment so as to put under its control the telegraph system of the country, though from this last and most important recommendation I must withhold my concurrence.

At the last session of Congress several bills were introduced into the House of Representatives for the reduction of letter postage to the rate of 2 cents per half ounce.

I have given much study and reflection to this subject, and am thoroughly persuaded that such a reduction would be for the best interests of the public.

It has been the policy of the Government from its foundation to defray as far as possible the expenses of carrying the mails by a direct tax in the form of postage.  It has never been claimed, however, that this service ought to be productive of a net revenue.

As has been stated already, the report of the Postmaster-General shows that there is now a very considerable surplus in his Department and that henceforth the receipts are likely to increase at a much greater ratio than the necessary expenditures.  Unless some change is made in the existing laws, the profits of the postal service will in a very few years swell the revenues of the Government many millions of dollars.  The time seems auspicious, therefore, for some reduction in the rates of postage.  In what shall that reduction consist?