The inconsiderable augmentation of the income of the Post-Office Department under the reduced rates of postage and its increasing expenditures must for the present make it dependent to some extent upon the Treasury for support.  The recommendations of the Postmaster-General in relation to the abolition of the franking privilege and his views on the establishment of mail steamship lines deserve the consideration of Congress.  I also call the special attention of Congress to the statement of the Postmaster-General respecting the sums now paid for the transportation of mails to the Panama Railroad Company, and commend to their early and favorable consideration the suggestions of that officer in relation to new contracts for mail transportation upon that route, and also upon the Tehuantepec and Nicaragua routes.

The United States continue in the enjoyment of amicable relations with all foreign powers.

When my last annual message was transmitted to Congress two subjects of controversy, one relating to the enlistment of soldiers in this country for foreign service and the other to Central America, threatened to disturb the good understanding between the United States and Great Britain.  Of the progress and termination of the former question you were informed at the time, and the other is now in the way of satisfactory adjustment.

The object of the convention between the United States and Great Britain of the 19th of April, 1850, was to secure for the benefit of all nations the neutrality and the common use of any transit way or interoceanic communication across the Isthmus of Panama which might be opened within the limits of Central America.  The pretensions subsequently asserted by Great Britain to dominion or control over territories in or near two of the routes, those of Nicaragua and Honduras, were deemed by the United States not merely incompatible with the main object of the treaty, but opposed even to its express stipulations.  Occasion of controversy on this point has been removed by an additional treaty, which our minister at London has concluded, and which will be immediately submitted to the Senate for its consideration.  Should the proposed supplemental arrangement be concurred in by all the parties to be affected by it, the objects contemplated by the original convention will have been fully attained.

The treaty between the United States and Great Britain of the 5th of June, 1854, which went into effective operation in 1855, put an end to causes of irritation between the two countries, by securing to the United States the right of fishery on the coast of the British North American Provinces, with advantages equal to those enjoyed by British subjects.  Besides the signal benefits of this treaty to a large class of our citizens engaged in a pursuit connected to no inconsiderable degree with our national prosperity and strength, it has had a favorable effect upon other interests in the provision it made for reciprocal freedom of trade between the United States and the British Provinces in America.  The exports of domestic articles to those Provinces during the last year amounted to more than $22,000,000, exceeding those of the preceding year by nearly $7,000,000; and the imports therefrom during the same period amounted to more than twenty-one million, an increase of six million upon those of the previous year.