question whether matter transmitted, or proposed to be transmitted, in the mails is obscene, indecent, filthy, scurrilous, or defamatory in nature. In this class is included the work of deciding cases of disputed ownership of mail and the giving of rulings to postmasters and others upon miscellaneous questions.

Numerous verbal and informal opinions were given to officers of the department upon questions of law constantly arising and relating to matters requiring immediate disposition. Of these opinions no record, of course, is kept.

CLAIMS OF POSTMASTERS.

Authority has been granted to the Postmaster General by the acts of Congress approved, respectively, May 9, 1888, and June 11, 1896, to reimburse postmasters in sums not exceeding $10,000 for losses of Government funds resulting from "fire, burglary, or other unavoidable casualty," at their respective post offices, and for losses of such funds in transit from postmasters to their designated depositaries. By the postal regulations it is made the duty of the Assistant Attorney General to examine this class of cases and advise the Postmaster General as to the allowance or disallowance of the claims presented.

During the fiscal year just closed 1,259 such claims were received, being a decrease of 136 from the number received during the fiscal year immediately preceding and an increase of 17 in comparison with the year ending June 30, 1908. The number of claims allowed was 1,058, which included 4 claims previously disallowed in whole or in part but reconsidered upon presentation of new evidence, and which was 240 greater than the number allowed during the previous year. The number disallowed was 346, being an increase of 66 as compared with the preceding year. Eight claims were voluntarily withdrawn by claimants, an increase of one over the number withdrawn during the year previous. When the funds on account of whose loss reimbursement is asked have been recovered the claims are dismissed. The number dismissed during the past year was 56, being a decrease of 15 from the number dismissed in the year preceding. The number of claims settled-that is, allowed, disallowed, withdrawn, and dismissed-was 1,468, an increase of 292 over the fiscal year 1909, and an increase of 305 over the fiscal year 1908, the number of claims pending on June 30, 1910, being 610, or 207 less than at the close of the preceding year. These pending claims are held mostly awaiting further evidence from claimants or reports from inspectors to whom all cases are referred for investigation and without which report no case is adjudicated. The total of allowances made was $218,338.36, as against $162,664.27 allowed the year previous, and $135,084.16 allowed during the year ended June 30, 1908.

A statement in tabular form, showing in detail the claims of postmasters for reimbursement for losses of money-order and postal funds, postage stamps, etc., which have been examined and considered in this office, and acted upon by the Postmaster General during the fiscal year just closed, with the amounts claimed, amounts allowed and disallowed, causes of loss, etc., has been prepared for

83933°-Ab. 1910-vol 2

submission to Congress as required by the act of March 17, 1882 (22 Stat. L., 29), as amended by the act of May 9, 1888 (25 Stat. L., 135), and the act of June 11, 1896 (29 Stat. L., 458).

OBSCENE AND INDECENT MATTER.

Highly beneficial results have been accomplished by the policy, inaugurated several years ago, of applying and enforcing more strictly the statute prohibiting the transmission in the mails of publications or other matter containing obscene or suggestive illustrations or advertisements. This policy affects especially those concerns which offer so-called "cures" for sexual diseases, whose advertisements are frequently found to be obscene as well as fraudulent and whose remedies are in many instances not only worthless, but positively injurious to health. As the number of enterprises of this nature brought to the attention of the department in the year just closed has been comparatively small, it is believed that most of them have been suppressed either by means of fraud orders or the exclusion of their advertising matter from the mails. For the purpose of protecting the unfortunate from fraud and physical harm the operations of such concerns should be kept under the strictest possible scrutiny, and this office will continue to deal promptly and vigorously with them.

The law declaring obscene matter unmailable was amended by section 211 of the act approved March 4, 1909, commonly called the Penal Code, which became effective January 1, 1910, by the addition of the words "and every filthy," which amendment had the effect of greatly reducing the quantity of such objectionable matter in the mails.

The following provision was contained in the act approved May 27, 1908, making appropriations for the service of the Post Office Department:

That section thirty-eight hundred and ninety-three of the Revised Statutes of the United States be, and the same is hereby, amended by adding thereto the following: "And the term 'indecent' within the intendment of this section shall include matter of a character tending to incite arson, murder, or assassination."

This provision was not included in the Penal Code and has now become obsolete. Believing that it was inadvertently omitted, I renew my recommendation that it be brought to the attention of Congress with a view to its reenactment as a permanent provision of law. A provision restoring this section to the law was included in a bill introduced in the Senate by Mr. Heyburn on April 7, 1910, S. 7645. This bill was referred to the Committee on the Judiciary and has not yet been reported upon.

OFFERS OF COMPROMISE.

The Auditor for the Post Office Department, acting under the provisions of sections 295 and 409 of the Revised Statutes, certified to the Postmaster General 15 offers of compromise, submitted by or on behalf of postmasters, mail contractors, and others, covering indebtedness owing by them to the United States. This class of cases included also propositions to remit fines, penalties, and forfeitures

accruing to the Government under the postal statutes. Due consideration was given in this office to the circumstances in each case, which was then submitted to the Postmaster General with advice as to whether the offer might properly be accepted or should be rejected. The quantity of work of this character has decreased in a marked degree as a result of a change of method in handling certain of these cases in the department and by reason of the operation of the Penal Code which went into effect on January 1, 1910.

CONTRACTS EXAMINED.

Contracts for supplies or services, or for the use of buildings as post offices, postal stations, or for similar purposes in large numbers have been examined during the year and approved as to form or returned for correction. The number of contracts for supplies and services passed upon was 377, of which 17 were returned for correction, the number examined being 168 greater than for the previous year. Post-office leases to the number of 612 were examined, of which 585 were approved and 27 disapproved, the total number being 63 greater than the number examined during the previous

Bonds of post-office inspectors and others examined during the year number 152 as against 92 for the preceding year.

APPLICATIONS FOR PARDON.

At the beginning of the fiscal year 13 applications for executive clemency, filed by persons who had been convicted of offenses against the postal laws, were pending before this office awaiting reports from the inspectors interested in the convictions. Additional applications to the number of 101 were received during the year, and reports were made to the Attorney General upon 102 applications, recommending in each instance that the petition be granted or that it be denied, as the facts disclosed by the records of this department seemed to war

The number of reports made in this class of cases exceeds by 28 the number made during the preceding year. At the close of the year 12 applications were on hand awaiting inspectors' reports.

CLAIMS FOR REWARD.

Claims to the number of 92 for reward for services rendered in the detection, arrest, and conviction of post-office burglars, highway mail robbers, and other offenders against the postal service were examined during the fiscal year and the chief inspector duly advised as to their allowance or disallowance, being an increase of 6 over the number of such claims examined during the previous year.

SUMMARY.

The following summary will indicate more clearly the volume of work performed during the year in comparison with that of the year immediately preceding:

Citations...

Fraud orders issued.

Reports of inspectors on lotteries and fraudulent schemes received and examined..

Opinions and rulings..

Claims for reward..

R. P. GOODWIN, Assistant Attorney General.

REPORT OF THE FIRST ASSISTANT POSTMASTER

GENERAL.

POST-OFFICE DEPARTMENT,

FIRST ASSISTANT POSTMASTER GENERAL,

Washington, November 22, 1910.

SIR: I have the honor to submit the annual report of this bureau for the fiscal year ended June 30, 1910.

THE POST-OFFICE SERVICE.

The number of post-offices in operation on June 30, 1910, was 59,580. The gross revenues of the service for the fiscal year amounted to $224,128,657.62, an increase of $20,566,274.55, or 10.10 per cent, and the expenditures to $229,977,224.50, an increase of $8,973,121.61, or 4.06 per cent, the deficit being $5,848,566.88 as compared with $17,441,719.82 for the preceding year. During the fiscal year ended June 30, 1909, the revenues increased at the rate of 6.31 per cent and the expenditures at the rate of 6.07 per cent. For the ten years ended June 30, 1909, the average annual rate of increase in expenditures was 8.06 per cent. It will thus be seen that although the business of the postal service for the last fiscal year increased at the rate of more than 10 per cent the expenditures dropped from 6.07 per cent increase in 1909, or from an average increase of 8.06 per cent for the ten years preceding, to 4.06 per cent in 1910. This is a most unprecedented and gratifying showing.

The number of post-offices established during the year was 1,509 and the number discontinued 2,073. At presidential offices 2,576 postmasters were appointed. Of these appointments 435 were at offices

advanced to the presidential class during the fiscal year. At fourthclass offices 9,428 postmasters were appointed.

On July 1, 1910, there were 7,625 presidential post offices. Of this number 424 were first class, an increase of 26; 1,828 were second class, an increase of 122; and 5,373 were third class, an increase of 275. The total increase in the number of presidential offices was 423. During the year 457 offices were advanced from the fourth to the third class.

By the readjustment of postmasters' salaries made on the basis of the gross receipts for the four quarters ended March 31, 1910, 29 offices were advanced from the second to the first class and 170 from the third to the second class, to take effect July 1, 1910. Three offices were reduced from the first to the second class; 19 from the second to the third class; and 22 from the third to the fourth class. The annual rate of expenditure for the salaries of presidential postmasters on July 1, 1910, was as follows: First class, $1,504,600; second class, $4,309,700; third class, $7,794,900, making a total of $13,609,200.

At the close of the fiscal year there were 2,100 assistant postmasters at first and second class offices, an increase of 122. The number of clerks at first and second class offices increased from 29,930 to 31,825, and the carrier force at city delivery offices from 27,620 to 28,715, being a net increase of 1,895 clerks and 1,095 carriers. Of the additional clerks appointed, 148 were assigned to new second-class offices. During the year there were appointed 4,475 clerks and 2,395 letter carriers. Of this number of clerks 2,498 were appointed to fill vacancies and 1,977 to new positions, while 1,292 carriers were appointed to fill vacancies and 1,103 to new positions. A readjustment of the service at a number of post-offices during the year, including offices relegated to the third class, enabled the department to effect reductions amounting to 82 in the clerical force and to 8 in the carrier force.

The aggregate salaries of additional clerks appointed during the fiscal year amounted to approximately $868,000, and of the carriers to $365,000. The saving resulting from the appointment of clerks at $600 to fill vacancies caused by separations from higher grades amounted to about $190,000, and the amount accruing from vacancies remaining unfilled temporarily and on account of deductions from the salaries of absent clerks was approximately $152,000. Similar figures for the carrier service are $226,000 and $213,000, respectively. The increase in the annual rate of expenditure due to the payment for the entire year of the salaries of employees appointed for a portion of the preceding year was about $193,000 for clerks and $318,350 for carriers. A total of $2,159,000 was required for the automatic promotion of clerks under the new salary law, while the promotion of carriers cost $1,606,475. The expense of promoting supervisory employees in post-offices amounted to $39,000. The net increase in the expenditure for clerks was $2,917,000, making the total expenditures $31,583,587, and for letter carriers $1,850,825, resulting in an aggregate cost of $30,392,579, including the expense for substitute, auxiliary, and temporary carriers, which was $16,047 less in 1910 than in the previous fiscal year.

At the close of the year there were 1,492 city delivery offices. The city delivery service was extended to 55 offices, for which 148 carriers at an expense of $63,416 were allowed.