The relations of the Department with railroad companies have been harmonized, notwithstanding the general reduction by Congress of their compensation by the appropriation for special facilities, and the railway post-office lines have been greatly extended, especially in the Southern States.  The interests of the Railway Mail Service and of the public would be greatly promoted and the expenditures could be more readily controlled by the classification of the employees of the Railway Mail Service as recommended by the Postmaster-General, the appropriation for salaries, with respect to which the maximum limit is already fixed by law, to be made in gross.

The Postmaster-General recommends an amendment of the law regulating the increase of compensation for increased service and increased speed on star routes, so as to enable him to advertise for proposals for such increased service and speed.  He also suggests the advantages to accrue to the commerce of the country from the enactment of a general law authorizing contracts with American-built steamers, carrying the American flag, for transporting the mail between ports of the United States and ports of the West Indies and South America, at a fixed maximum price per mile, the amount to be expended being regulated by annual appropriations, in like manner with the amount paid for the domestic star service.

The arrangement made by the Postmaster-General and the Secretary of the Treasury for the collection of duty upon books received in the mail from foreign countries has proved so satisfactory in its practical operation that the recommendation is now made that Congress shall extend the provisions of the act of March 3, 1879, under which this arrangement was made, so as to apply to all other dutiable articles received in the mails from foreign countries.

The reports of the Secretary of the Interior and of the Commissioner of Indian Affairs, setting forth the present state of our relations with the Indian tribes on our territory, the measures taken to advance their civilization and prosperity, and the progress already achieved by them, will be found of more than ordinary interest.  The general conduct of our Indian population has been so satisfactory that the occurrence of two disturbances, which resulted in bloodshed and destruction of property, is all the more to be lamented.

The history of the outbreak on the White River Ute Reservation, in western Colorado, has become so familiar by elaborate reports in the public press that its remarkable incidents need not be stated here in detail.  It is expected that the settlement of this difficulty will lead to such arrangements as will prevent further hostile contact between the Indians and the border settlements in western Colorado.

The other disturbance occurred at the Mescalero Agency, in New Mexico, where Victoria, at the head of a small band of marauders, after committing many atrocities, being vigorously chased by a military force, made his way across the Mexican border and is now on foreign soil.