To ascertain what second-class matter costs has been found to be a puzzling proposition. Many have tried to solve the puzzle and all have failed.The Joint Congressional Commission consisting of Penrose, Carter and Clay for the Senate, and Overstreet, Moon and Gardner for the House, with the aid of numerous expert accountants, at a cost of a quarter of a million dollars (according to the President’s statement), attempted it and gave it up. All these gentlemen are on record as declaring that it is a task impossible of accomplishment.Senator Bristow, a former Assistant Postmaster General, who has given postal questions much careful study, said in a recent speech that “It does not cost nine cents a pound, nor can the Department ascertain with even approximate accuracy what is the cost of handling any special class of mail. It would be just aseasy for the Pennsylvania Railroad to state in dollars and cents what it costs to haul a ton of coal from Harrisburg to Pittsburgh, or 100 pounds of silk from Pittsburgh to Indianapolis, as for the Postoffice Department to state what it costs the Department to handle newspapers or magazines. Anyone familiar with transportation knows that such calculations cannot be made with accuracy, because there are so many unassignable expenses that must be considered—expenditures that cannot be subdivided and assigned to the different classes of freight. The same is true as to the different classes of mail.”Postal officials have exhausted conjecture as a basis for a correct solution of this problem. Nearly every year there has been a new guess. Mr. Madden, Third Assistant Postmaster-General for seven years up to 1907, guessed that it cost 4 cents a pound. His successor, Mr. Lawshe, guessed 2½ cents and then the next year 4 cents. For the last two years the Department’s guess has been 9 cents.The Penrose-Overstreet Commission declared, while it is impossible to ascertain with certainty what the cost is, the members of the Commission gave it as their opinion that “One cent a pound is approximately adequate compensation for handling and transporting second-class matter.”I am confident that there is a better way of solving the problem than has heretofore been tried. This consists in the direct application of plain, old-fashioned common sense to it. A little gumption in such a matter as this is far better than fanciful guessing or astute figuring by experts, who are bent on finding something that is not there.In working out this problem I have adopted a method quite different and have obtained results quite unlike the foregoing. I show the relation of second-class mail to stamp mail extending over a period of 25 years, from 1885 to 1910. This covers the entire period since the institution of the cent a pound rate.I go back still further to 1876 when the postage rate on newspapers was 4 times greater than now, when the sale of stamps was less than one-eleventh what it is now,and while deficits were larger.The highest point reached in the weight of second-class matter previous to the institution of the present rate, was 101,057,963 pounds.It has been repeatedly declared officially that second-class matter originates large quantities of other classes of mail, and in the official figures we have the proof.While population increased from 1885 to 1910 only a little more than double, the revenue from the sale of stamps, etc., and the weight of second-class matter, each increased over 5 times.No other possible reason can be assigned for the increase in stamp mail, and the tremendous development of every branch of the postal business 5 times faster than the growth of population, than the increased circulation and influence of the newspaper and periodical press, brought about by the reduced postage rate.Second-Class matter would have long ago wiped out all deficits and created an enormous annual surplus had it not been for the great burdens which weighed the service down.There would have been a surplus, instead of a deficit, every year since 1901, had allowance been made for the extraordinary cost of free rural delivery, and in 1910, the surplus would have been $31,075,170.12.If also allowance had been made for free government matter, other than the Postoffice Department’s own free matter, being sent stamped as first-class matter is, the surplus for 1910 would have been $51,075,470.12 and these figures like all others here given, are from official reports.A VAST INCREASE OF EXPENDITURES.Not only did stamp mail, under the stimulus of the steady and enormous increase of second-class matter, enable the Department to meet the cost of rural delivery while reducing the deficit, but it also met and overcame the immense increase of the annual expenditures for railroad transportation which grew from $33,523,902.18 in 1901 to $44,654,515.97 in 1910: of salaries to postmasters, assistants and clerks which grew from $32,790,253.39 in 1901 to $65,582,533.57 in 1910, of the railway mail service which grew from $9,675,436.52 to $19,385,096.97 in 1910, and of the city delivery service which grew from $15,752,600 in 1901 to $36,841,407.40 in 1910. In these four items alone there was an increase in annual expenditures in the last ten years of $74,721,361.82, for which second-class matter was only in a very limited way responsible.Entirely too much stress has been placed upon the cost of second-class matter, for it makes little difference whether it costs 2½ cents or 4 cents or 9 cents, or even more, if it produce results commensurate with its cost, and this it would doif the cost were double the highest guess yet made. The Government could afford to carry it free rather than not carry it at all, for without it the bottom would drop out of the Postal Establishment. As long as the people get the benefit of the low rate, as they are doing now, for which we have official testimony, it matters not what the rate is except that it should be kept at the very bottom notch.WHY THE POSTAGE RATE WAS MADE LOW.Even if the cost of second-class matter should be declared to be more than one cent per pound, it would not be good public policy for Congress to increase it, because much reading matter would be placed out of the reach of many who now are receiving the benefit of it.Postmaster-General Meyer said in his report for 1908: “The charge for carrying second-class mail matter was intentionally fixed below cost for the purpose of encouraging the dissemination of information of educational value to the people,and the benefit of the cheap rate of postage is passed on to the subscriber in a lower subscription price than would otherwise be possible.”The Hon. Charles Emory Smith truly declared: “Our free institutions rest on popular intelligence, and it has from the beginning been our fixed and enlightened policy to foster and promote the general diffusion of public information. Congress has wisely framed the postal laws with this just and liberal conception.“It has uniformly sought to encourage intercommunication and the exchange of intelligence. As facilities have cheapened, it has gradually lowered allpostage rates. It has never aimed to make the postal service a source of profit, but simply to make it pay its own way and to give the people the benefit of all possible advancement.“In harmony with this sound and judicious policy, it has deliberately established a low rate of postage for genuine newspapers and periodicals, with the express design of encouraging and aiding the distribution of the recognized means and agencies of public information.“It is not a matter of favor, but of approved judgment.It is not for the publishers, but for the people.”The testimony of Senator Bristow is that, “I am glad we have got a one-cent rate of postage for the legitimate newspapers and magazines of the country, and I would rather decrease it than raise it.The beneficiaries are the poor people themselves, who now get daily papers at from $2 to $4 a year, when they used to pay from $10 to $12. They now get magazines from $1 to $1.50, when they used to pay $4 to $6 per year for magazines of no higher grade.” …And I would remind the Commission that there are millions of laboring men and women who cannot afford to add to their living expenses the cost of any but the very cheapest reading matter, and many not even that. After buying food and clothing and providing shelter there is scarcely anything left in the home for cultivating the intellect and informing the mind.When sickness intervenes, then comes the stress of debt, and if death follow, the future has to be drawn upon to give the dead a burial such as love would provide. Are these people,the bone and sinew of the land, those in the humble walks of life, not to be considered when it is proposed to add to the cost of the family reading?It surely should not be made more difficult for the poor to obtain that which is so essential to their welfare and that of the Republic of which they form an important part.…“But here I cannot forbear to recommend,” said George Washington, in his message to Congress, on November 6, 1792, “a repeal of the tax on the transportation of public prints. There is no resource so firm for the government of the United States as the affections of the people, guided by an enlightened policy; and to this primary good, nothing can conduce more than a faithful representation of public proceedings diffused without restraint throughout the United States.”NEWSPAPERS AND PERIODICALS.—THE DIFFERENCE.An effort was made in the closing hours of the 61st Congress to increase the postage rate on magazines. It is my opinion that the postage rate should remain uniform as it is now upon all classes of publications. There should be no partiality shown, there should be no discrimination. A proposal to increase the rate on magazines alone, is not one that should have the endorsement of this Commission nor the approval of Congress, as I shall endeavor to show.Under Section 432 of the Postal Laws and Regulations, “A newspaper is held to be a publication regularly issued at stated intervals of not longer than one week; a periodical is held to be a publication regularly issued at stated intervals less frequently than weekly.”A magazine is nowhere defined in the Postal Laws and Regulations. A law that would increase the postage rate on “magazines,” without an explicit definition of the word, would apply to just such publications as the Postmaster-General might select in the administration of the law, and none others. No such power of discrimination should be vested in any official. The Postmaster-General is an executive, not a judicial officer, nor a lawmaker.It has been wisely and aptly said that this is a government of laws and not of men; that there is no arbitrary power located in any individual or body of individuals; but that all in authority are guided and limited by those provisions which the people have, through the organic law, declared shall be the measure and scope of all control exercised over them.There seems to be no good reason why a newspaper, which is carried in the mails once a day or once a week, should pay a less rate than a monthly or quarterly. If the Government really loses money in handling and transporting second-class matter, the loss would be greater on the former than on the latter, because a daily goes through the mails 365 times a year, a weekly 52 times, while a monthly only goes 12 times, and a quarterly 4 times.We learn from official records that daily newspapers comprise 40.50 per cent. of all second-class matter, weeklies 15.23 per cent., papers devoted to science 1.30, to education .64, religious 5.91, trade 4.94, agriculture 5, magazines 20.23, and miscellaneous 6.25. Note that it is stated that 20.23 of the whole consists of magazines; but what is a magazine? We are nowhere told, and the percentage quoted has the appearance of being founded upon conjecture.…This Commission may not be aware of the fact that the Pennsylvania Railroad will take, and does take, packages of papers for all of the great newspapers that are published along its lines, and transports them in the baggage cars for one-quarter of a cent per pound, to any station on the line, whether it is ten miles from the place of origin, or 1,000 miles from the place of origin. And yet the Department is paying the railroads approximately two cents a pound for hauling the newspapers of the country.The papers are delivered by the publishers to the train just the same as the publisher delivers his newspapers to the train when they are sent by mail. These packages are delivered to the depots of the railroads, and the parties to whom they are sent call at the depots for the packages. If they are sent by mail the publisher delivers them at the train, and the parties to whom they are addressed call at the postoffice for the packages. The postoffice Department does not go to the newspaper office and get the mail. The publisher delivers the newspapers to the mail trains, the same as he delivers them to baggage cars for the railroad company.And possibly the Commission has not been informed that the express companies have a contract with the American Publishers’ Association whereby they agree to receive newspaper packages of any size, and deliver them to their destination within a limit of 500 miles, for one-half cent per pound. The express company does not call at the newspaper office for the papers. The publisher delivers them to the express car, the same as he delivers his papers to the mail car. The express company then takes these newspapers, consisting of packagesof any size, from a single wrapper to a 100-pound bundle, and delivers them at the other end of the line to the addresses, if the distance is not greater than 500 miles, for half a cent a pound, and by its contract with the railroad the express company pays the railroad only a quarter of a cent a pound.The Department figures show that the average distance which newspapers are hauled is less than 300 miles. Yet the Department is paying about two cents a pound to the railroad for that which the express companies pay but a quarter of a cent a pound. The express companies only charge the publisher one-half cent a pound, while the Government charges him one cent a pound. The express companies pay the railways one-fourth a cent a pound, while the Government pays about two cents—eight times as much—for exactly the same service. The express companies are glad to get the business, and render more service than the Postoffice Department, because they deliver the packages of any size at the other end, which the Department does not do.Senator Bristow is authority for the above statements concerning the railroad and express contracts.…Now I would not have this (class) newspaper and its annexes deprived of the low postage rate, but as the Postoffice Department has within the past ten years denied admission to the mails of 11,563 of other publications, and 32,000 others have been ruled out or died from the hard conditions imposed, I would respectfully request this Commission to ascertain and report to the President for transmission to Congresswhy there has never been a single publication of this class shut out or even molested in the slightest degree?I do not say it is, butisit, because such papers are politically powerful, that they have the ear of the public, that they hold a monopoly of the news, and that they can make or unmake the reputation of public officials at will, and that therefore they are immune from interference?…I have here a copy of thePolice Gazette, which I take to be a superior paper of its class. It is held to be a newspaper, entitled to transmission through the mails at a cent a pound. It has never been proposed to raise the postage rate on this paper.…This Commission should endeavor to find out and report to the President for transmission to Congress, why the postage rate on one-half of the periodicals devoted to agriculture should be increased from one cent to three cents, and the postage rate on the Police Gazette should remain at one cent.
To ascertain what second-class matter costs has been found to be a puzzling proposition. Many have tried to solve the puzzle and all have failed.
The Joint Congressional Commission consisting of Penrose, Carter and Clay for the Senate, and Overstreet, Moon and Gardner for the House, with the aid of numerous expert accountants, at a cost of a quarter of a million dollars (according to the President’s statement), attempted it and gave it up. All these gentlemen are on record as declaring that it is a task impossible of accomplishment.
Senator Bristow, a former Assistant Postmaster General, who has given postal questions much careful study, said in a recent speech that “It does not cost nine cents a pound, nor can the Department ascertain with even approximate accuracy what is the cost of handling any special class of mail. It would be just aseasy for the Pennsylvania Railroad to state in dollars and cents what it costs to haul a ton of coal from Harrisburg to Pittsburgh, or 100 pounds of silk from Pittsburgh to Indianapolis, as for the Postoffice Department to state what it costs the Department to handle newspapers or magazines. Anyone familiar with transportation knows that such calculations cannot be made with accuracy, because there are so many unassignable expenses that must be considered—expenditures that cannot be subdivided and assigned to the different classes of freight. The same is true as to the different classes of mail.”
Postal officials have exhausted conjecture as a basis for a correct solution of this problem. Nearly every year there has been a new guess. Mr. Madden, Third Assistant Postmaster-General for seven years up to 1907, guessed that it cost 4 cents a pound. His successor, Mr. Lawshe, guessed 2½ cents and then the next year 4 cents. For the last two years the Department’s guess has been 9 cents.
The Penrose-Overstreet Commission declared, while it is impossible to ascertain with certainty what the cost is, the members of the Commission gave it as their opinion that “One cent a pound is approximately adequate compensation for handling and transporting second-class matter.”
I am confident that there is a better way of solving the problem than has heretofore been tried. This consists in the direct application of plain, old-fashioned common sense to it. A little gumption in such a matter as this is far better than fanciful guessing or astute figuring by experts, who are bent on finding something that is not there.
In working out this problem I have adopted a method quite different and have obtained results quite unlike the foregoing. I show the relation of second-class mail to stamp mail extending over a period of 25 years, from 1885 to 1910. This covers the entire period since the institution of the cent a pound rate.
I go back still further to 1876 when the postage rate on newspapers was 4 times greater than now, when the sale of stamps was less than one-eleventh what it is now,and while deficits were larger.
The highest point reached in the weight of second-class matter previous to the institution of the present rate, was 101,057,963 pounds.
It has been repeatedly declared officially that second-class matter originates large quantities of other classes of mail, and in the official figures we have the proof.
While population increased from 1885 to 1910 only a little more than double, the revenue from the sale of stamps, etc., and the weight of second-class matter, each increased over 5 times.No other possible reason can be assigned for the increase in stamp mail, and the tremendous development of every branch of the postal business 5 times faster than the growth of population, than the increased circulation and influence of the newspaper and periodical press, brought about by the reduced postage rate.
Second-Class matter would have long ago wiped out all deficits and created an enormous annual surplus had it not been for the great burdens which weighed the service down.
There would have been a surplus, instead of a deficit, every year since 1901, had allowance been made for the extraordinary cost of free rural delivery, and in 1910, the surplus would have been $31,075,170.12.
If also allowance had been made for free government matter, other than the Postoffice Department’s own free matter, being sent stamped as first-class matter is, the surplus for 1910 would have been $51,075,470.12 and these figures like all others here given, are from official reports.
A VAST INCREASE OF EXPENDITURES.
Not only did stamp mail, under the stimulus of the steady and enormous increase of second-class matter, enable the Department to meet the cost of rural delivery while reducing the deficit, but it also met and overcame the immense increase of the annual expenditures for railroad transportation which grew from $33,523,902.18 in 1901 to $44,654,515.97 in 1910: of salaries to postmasters, assistants and clerks which grew from $32,790,253.39 in 1901 to $65,582,533.57 in 1910, of the railway mail service which grew from $9,675,436.52 to $19,385,096.97 in 1910, and of the city delivery service which grew from $15,752,600 in 1901 to $36,841,407.40 in 1910. In these four items alone there was an increase in annual expenditures in the last ten years of $74,721,361.82, for which second-class matter was only in a very limited way responsible.
Entirely too much stress has been placed upon the cost of second-class matter, for it makes little difference whether it costs 2½ cents or 4 cents or 9 cents, or even more, if it produce results commensurate with its cost, and this it would doif the cost were double the highest guess yet made. The Government could afford to carry it free rather than not carry it at all, for without it the bottom would drop out of the Postal Establishment. As long as the people get the benefit of the low rate, as they are doing now, for which we have official testimony, it matters not what the rate is except that it should be kept at the very bottom notch.
WHY THE POSTAGE RATE WAS MADE LOW.
Even if the cost of second-class matter should be declared to be more than one cent per pound, it would not be good public policy for Congress to increase it, because much reading matter would be placed out of the reach of many who now are receiving the benefit of it.
Postmaster-General Meyer said in his report for 1908: “The charge for carrying second-class mail matter was intentionally fixed below cost for the purpose of encouraging the dissemination of information of educational value to the people,and the benefit of the cheap rate of postage is passed on to the subscriber in a lower subscription price than would otherwise be possible.”
The Hon. Charles Emory Smith truly declared: “Our free institutions rest on popular intelligence, and it has from the beginning been our fixed and enlightened policy to foster and promote the general diffusion of public information. Congress has wisely framed the postal laws with this just and liberal conception.
“It has uniformly sought to encourage intercommunication and the exchange of intelligence. As facilities have cheapened, it has gradually lowered allpostage rates. It has never aimed to make the postal service a source of profit, but simply to make it pay its own way and to give the people the benefit of all possible advancement.
“In harmony with this sound and judicious policy, it has deliberately established a low rate of postage for genuine newspapers and periodicals, with the express design of encouraging and aiding the distribution of the recognized means and agencies of public information.
“It is not a matter of favor, but of approved judgment.It is not for the publishers, but for the people.”
The testimony of Senator Bristow is that, “I am glad we have got a one-cent rate of postage for the legitimate newspapers and magazines of the country, and I would rather decrease it than raise it.The beneficiaries are the poor people themselves, who now get daily papers at from $2 to $4 a year, when they used to pay from $10 to $12. They now get magazines from $1 to $1.50, when they used to pay $4 to $6 per year for magazines of no higher grade.” …
And I would remind the Commission that there are millions of laboring men and women who cannot afford to add to their living expenses the cost of any but the very cheapest reading matter, and many not even that. After buying food and clothing and providing shelter there is scarcely anything left in the home for cultivating the intellect and informing the mind.
When sickness intervenes, then comes the stress of debt, and if death follow, the future has to be drawn upon to give the dead a burial such as love would provide. Are these people,the bone and sinew of the land, those in the humble walks of life, not to be considered when it is proposed to add to the cost of the family reading?
It surely should not be made more difficult for the poor to obtain that which is so essential to their welfare and that of the Republic of which they form an important part.…
“But here I cannot forbear to recommend,” said George Washington, in his message to Congress, on November 6, 1792, “a repeal of the tax on the transportation of public prints. There is no resource so firm for the government of the United States as the affections of the people, guided by an enlightened policy; and to this primary good, nothing can conduce more than a faithful representation of public proceedings diffused without restraint throughout the United States.”
NEWSPAPERS AND PERIODICALS.—THE DIFFERENCE.
An effort was made in the closing hours of the 61st Congress to increase the postage rate on magazines. It is my opinion that the postage rate should remain uniform as it is now upon all classes of publications. There should be no partiality shown, there should be no discrimination. A proposal to increase the rate on magazines alone, is not one that should have the endorsement of this Commission nor the approval of Congress, as I shall endeavor to show.
Under Section 432 of the Postal Laws and Regulations, “A newspaper is held to be a publication regularly issued at stated intervals of not longer than one week; a periodical is held to be a publication regularly issued at stated intervals less frequently than weekly.”
A magazine is nowhere defined in the Postal Laws and Regulations. A law that would increase the postage rate on “magazines,” without an explicit definition of the word, would apply to just such publications as the Postmaster-General might select in the administration of the law, and none others. No such power of discrimination should be vested in any official. The Postmaster-General is an executive, not a judicial officer, nor a lawmaker.
It has been wisely and aptly said that this is a government of laws and not of men; that there is no arbitrary power located in any individual or body of individuals; but that all in authority are guided and limited by those provisions which the people have, through the organic law, declared shall be the measure and scope of all control exercised over them.
There seems to be no good reason why a newspaper, which is carried in the mails once a day or once a week, should pay a less rate than a monthly or quarterly. If the Government really loses money in handling and transporting second-class matter, the loss would be greater on the former than on the latter, because a daily goes through the mails 365 times a year, a weekly 52 times, while a monthly only goes 12 times, and a quarterly 4 times.
We learn from official records that daily newspapers comprise 40.50 per cent. of all second-class matter, weeklies 15.23 per cent., papers devoted to science 1.30, to education .64, religious 5.91, trade 4.94, agriculture 5, magazines 20.23, and miscellaneous 6.25. Note that it is stated that 20.23 of the whole consists of magazines; but what is a magazine? We are nowhere told, and the percentage quoted has the appearance of being founded upon conjecture.…
This Commission may not be aware of the fact that the Pennsylvania Railroad will take, and does take, packages of papers for all of the great newspapers that are published along its lines, and transports them in the baggage cars for one-quarter of a cent per pound, to any station on the line, whether it is ten miles from the place of origin, or 1,000 miles from the place of origin. And yet the Department is paying the railroads approximately two cents a pound for hauling the newspapers of the country.
The papers are delivered by the publishers to the train just the same as the publisher delivers his newspapers to the train when they are sent by mail. These packages are delivered to the depots of the railroads, and the parties to whom they are sent call at the depots for the packages. If they are sent by mail the publisher delivers them at the train, and the parties to whom they are addressed call at the postoffice for the packages. The postoffice Department does not go to the newspaper office and get the mail. The publisher delivers the newspapers to the mail trains, the same as he delivers them to baggage cars for the railroad company.
And possibly the Commission has not been informed that the express companies have a contract with the American Publishers’ Association whereby they agree to receive newspaper packages of any size, and deliver them to their destination within a limit of 500 miles, for one-half cent per pound. The express company does not call at the newspaper office for the papers. The publisher delivers them to the express car, the same as he delivers his papers to the mail car. The express company then takes these newspapers, consisting of packagesof any size, from a single wrapper to a 100-pound bundle, and delivers them at the other end of the line to the addresses, if the distance is not greater than 500 miles, for half a cent a pound, and by its contract with the railroad the express company pays the railroad only a quarter of a cent a pound.
The Department figures show that the average distance which newspapers are hauled is less than 300 miles. Yet the Department is paying about two cents a pound to the railroad for that which the express companies pay but a quarter of a cent a pound. The express companies only charge the publisher one-half cent a pound, while the Government charges him one cent a pound. The express companies pay the railways one-fourth a cent a pound, while the Government pays about two cents—eight times as much—for exactly the same service. The express companies are glad to get the business, and render more service than the Postoffice Department, because they deliver the packages of any size at the other end, which the Department does not do.
Senator Bristow is authority for the above statements concerning the railroad and express contracts.
…
Now I would not have this (class) newspaper and its annexes deprived of the low postage rate, but as the Postoffice Department has within the past ten years denied admission to the mails of 11,563 of other publications, and 32,000 others have been ruled out or died from the hard conditions imposed, I would respectfully request this Commission to ascertain and report to the President for transmission to Congresswhy there has never been a single publication of this class shut out or even molested in the slightest degree?
I do not say it is, butisit, because such papers are politically powerful, that they have the ear of the public, that they hold a monopoly of the news, and that they can make or unmake the reputation of public officials at will, and that therefore they are immune from interference?…
I have here a copy of thePolice Gazette, which I take to be a superior paper of its class. It is held to be a newspaper, entitled to transmission through the mails at a cent a pound. It has never been proposed to raise the postage rate on this paper.…
This Commission should endeavor to find out and report to the President for transmission to Congress, why the postage rate on one-half of the periodicals devoted to agriculture should be increased from one cent to three cents, and the postage rate on the Police Gazette should remain at one cent.
I intended to follow the hearings before this commission personally. Ill health prevented my doing so. Under this stress, I asked my friend, Mr. M. H. Madden, quoted on a previous page in connection with other phases of our general subject, to summarize for me the hearings of the commission in August. Mr. Madden kindlyconsented to do so. Following is what he writes me relating to the commission’s proceedings and hearings:
The first meeting of the commission took place on August 1, and it continued its hearings in New York City, with occasional adjournments during the greater part of the month.Postmaster General Hitchcock represented his department before the commission, Second Assistant Stewart and Third Assistant Britt were also present, each in turn occupying the stand. Hitchcock outlined his position concerning a demand for an increase for the first time, although the same idea was expressed by Third Assistant Britt some months ago, when Britt made an address before a convention of newspaper circulation managers in Chicago. Hitchcock and his two assistants held to the view that each schedule in the postal service should be made self-sustaining, the credit for this idea being given to Hitchcock, and in order to justify his position concerning a raise in second-class rates an arbitrary figure has been placed on the cost of handling the same, the total “deficit” from this schedule being placed at about $70,000,000 annually. This amount was arrived at by what Second Assistant Postmaster General Stewart states was a complete record of the weighing of all mail handled by the Postoffice Department of matter originating in every postoffice and railway postoffice in the country for a period of six months from July 1 to December 1, 1907, together with the amount of mail carried in every railway car. The department in many instances has admitted the unreliability of the figures used, there having been many estimates employed.Publishers of the country were represented by several attorneys who examined into the testimony given by Hitchcock, Stewart and Britt, and by a series of questions they showed that the conclusions of the three as to cost of handling second-class mail were made on a guesswork plan and not on a scientific or reasonably accurate basis of fact. Third Assistant Postmaster General Britt made the startling statement that “if all the magazines and newspapers were excluded from the second-class rates because of a circulation gained,not on the meritsof the publication, butbecause of some voting contest or offer of premiums as a bait, not 10 per cent. of the total would remain undisturbed.”This declaration was looked upon as an argument by the magazine publishers as favoring their contention that the advertising portions of their periodicals are justified by legitimate business reasons, as an increased volume of advertising enables publishers to issue periodicals of much higher literary excellence. The postal authorities held with firmness to the conviction that advertising matter in publications is primarily for the advantage of the publisher, and therefore should be charged a higher rate than reading matter. Postmaster General Hitchcock went on record before the commission as declaring that he would recommend to Congress an increase on the advertising portion of magazines and newspapers of a cent a pound additional. Assuming that the postoffice officials are prompted by a legitimate purpose in their desire to increase rates on second-class matter, their arguments before the commission have been transparently weak, and an unbiased mind they would fail in convincing, but the feeling is that the commission will accept the conclusions of the postal authorities thatthe government rate of one cent a pound is inadequate for transporting second-class matter. To justify the position taken by the government that each schedule should maintain itself, the Postmaster General intends to press with vigor a reduction of first-class postage from two-cents to one cent a letter, he citing the profit on first-class mail and the alleged loss on second-class matter as his reason for the change of rate.Religious and denominational publications were represented before the commission, the contention being made by these that the doubling of the rate on second-class matter would work very serious injury to the religious press, forcing many publications out of business. This statement was made by E. R. Graham, representing the Methodist Book Concern publications in Cincinnati and New York, and seemingly it made an impression on the members of the commission. The attorneys representing the publishers were much interested in Mr. Graham’s statement, he being considered a competent authority on the matter.One of the strongest arguments of the hearings, because of the experience which he has had as a postal official, was made by Mr. W. S. Shallenberger, who had served several years in Congress as a member of the Committee on Postoffice and Postroads. Mr. Shallenberger was for a number of years Second Assistant Postmaster General, and now represents the Interdenominational Publishers who issue Sunday school literature throughout the United States. This witness gave it as his opinion that an increase in the rate on second-class matter would cause magazines and newspapers to avail themselves of the facilities now offered by the express companies which are becoming active competitors of the government in transporting second-class matter, these corporations obtaining better rates from the railroads than is given to the government. Mr. Shallenberger expressed the view that since every civilized nation was cheapening the cost of postal service the fact that our country was seeking to increase the rate seemed to be reactionary.Mr. Shallenberger served under six Postmaster Generals and all of these held that the government was carrying second-class matter at a loss. But his opinion was that there was a substantial profit in the present rate, at the same time condemning the idea that each particular schedule should be made to pay its own way, the stimulus toward encouraging other schedule receipts not being given its proper consideration. Mr. Shallenberger gave a hint concerning hidden influences seeking to have the second-class rate increased but did not enter deeply into this phase of the subject. The controversy between Mr. Shallenberger and Second Assistant Stewart was animated and prolonged, and touched on features connected with the compensation paid railroads for hauling the mail, the express companies getting better terms than the government, this statement being made by a representative of the Postal Progress League.The strongest point the publishing interests made was when the superintendent of the railway mail service, Chas. H. McBride, testified that a considerable part of the estimate upon which the department’s figures are based is guesswork and assumption, he admitting that if this were so the result would not be greatly different from what the officials first claimed. On the whole SuperintendentMcBride’s testimony was calculated to show that the Postoffice Department was desirous of making out a case against the second-class schedule, however necessary it was to twist figures and conceal facts in order to do so.Mr. Wilmer Atkinson, publisher of Farm Journal, Philadelphia, combated the contention of the postoffice officials, as shown in their statements and tables, and declared with much emphasis that second-class matter stimulated first-class postage receipts. The statement of the cost of carrying second-class matter, placing it at nine cents a pound, is, according to him, “only a stereotyped guess that goes into the postoffice department report, each year,” experts having repeatedly stated that there is no possible way of fixing the cost of carrying second-class mail. In the opinion of Mr. Atkinson the government could better afford to carry it free than not to carry it at all. “Gumption and common sense,” declared Mr. Atkinson, “should rather be applied than indulging in worthless guessing.”Representatives of scientific publications, college journals, fashion papers, fraternal societies and trade periodicals appeared before the members of the commission during the sessions, and all entered emphatic protests against the increase. In numerous instances these interests made the statement that serious reverses would be encountered if the postage rate should be doubled, and that many publications would be forced to suspend.The labor union press, an interest representing about 250 weekly and monthly publications, with a circulation approximating 1,250,000 copies was officially represented by President Samuel Gompers of the American Federation of Labor, and President Matthew Woll, of the Photo-Engravers’ Union. Mr. Gompers entered vigorous protests against discriminations against labor publications and registered a severe censure of the method by which the Postoffice Department had hampered the official journals of the labor people. Mr. Gompers stated that the publications of the American Federation of Labor and its auxiliaries were all highly educational in their character and, in the event of an increase in the item of postage to the extent of 100 per cent additional, many of the best would be driven out of business with corresponding loss to the men individually and to the nation as a whole. Mr. Gompers’ declaration was listened to with much interest.President Woll dwelt on the far-reaching effect which the hampering of the labor press would have on the manifold business relationships involved in the printing industry, primarily directing attention to the more than a third of a million of workers in the printing trades alone. He then advanced to the foundation of the paper and machinery features of the proposition, viz., from the ore in the mine, from which the machinery was made, to the forest tree from which the pulp is ground. The tonnage of the transportation service of the country would at once be doubly interfered with, first in a reduced demand for material with which to make the paper and, secondly, the corresponding decrease in the weight of the finished product of the publications. In many features Mr. Woll made prominent the ideas which the “Postal Riders and Raiders” is promoting, includingthe educational features of the immense volume of printing which comes from the printing press in all sections of the country.The commission adjourned, subject to the call of Justice Hughes. However, it is understood that it will be called together in time to prepare its report to President Taft and to Congress when the session opens in December, 1911.
The first meeting of the commission took place on August 1, and it continued its hearings in New York City, with occasional adjournments during the greater part of the month.
Postmaster General Hitchcock represented his department before the commission, Second Assistant Stewart and Third Assistant Britt were also present, each in turn occupying the stand. Hitchcock outlined his position concerning a demand for an increase for the first time, although the same idea was expressed by Third Assistant Britt some months ago, when Britt made an address before a convention of newspaper circulation managers in Chicago. Hitchcock and his two assistants held to the view that each schedule in the postal service should be made self-sustaining, the credit for this idea being given to Hitchcock, and in order to justify his position concerning a raise in second-class rates an arbitrary figure has been placed on the cost of handling the same, the total “deficit” from this schedule being placed at about $70,000,000 annually. This amount was arrived at by what Second Assistant Postmaster General Stewart states was a complete record of the weighing of all mail handled by the Postoffice Department of matter originating in every postoffice and railway postoffice in the country for a period of six months from July 1 to December 1, 1907, together with the amount of mail carried in every railway car. The department in many instances has admitted the unreliability of the figures used, there having been many estimates employed.
Publishers of the country were represented by several attorneys who examined into the testimony given by Hitchcock, Stewart and Britt, and by a series of questions they showed that the conclusions of the three as to cost of handling second-class mail were made on a guesswork plan and not on a scientific or reasonably accurate basis of fact. Third Assistant Postmaster General Britt made the startling statement that “if all the magazines and newspapers were excluded from the second-class rates because of a circulation gained,not on the meritsof the publication, butbecause of some voting contest or offer of premiums as a bait, not 10 per cent. of the total would remain undisturbed.”
This declaration was looked upon as an argument by the magazine publishers as favoring their contention that the advertising portions of their periodicals are justified by legitimate business reasons, as an increased volume of advertising enables publishers to issue periodicals of much higher literary excellence. The postal authorities held with firmness to the conviction that advertising matter in publications is primarily for the advantage of the publisher, and therefore should be charged a higher rate than reading matter. Postmaster General Hitchcock went on record before the commission as declaring that he would recommend to Congress an increase on the advertising portion of magazines and newspapers of a cent a pound additional. Assuming that the postoffice officials are prompted by a legitimate purpose in their desire to increase rates on second-class matter, their arguments before the commission have been transparently weak, and an unbiased mind they would fail in convincing, but the feeling is that the commission will accept the conclusions of the postal authorities thatthe government rate of one cent a pound is inadequate for transporting second-class matter. To justify the position taken by the government that each schedule should maintain itself, the Postmaster General intends to press with vigor a reduction of first-class postage from two-cents to one cent a letter, he citing the profit on first-class mail and the alleged loss on second-class matter as his reason for the change of rate.
Religious and denominational publications were represented before the commission, the contention being made by these that the doubling of the rate on second-class matter would work very serious injury to the religious press, forcing many publications out of business. This statement was made by E. R. Graham, representing the Methodist Book Concern publications in Cincinnati and New York, and seemingly it made an impression on the members of the commission. The attorneys representing the publishers were much interested in Mr. Graham’s statement, he being considered a competent authority on the matter.
One of the strongest arguments of the hearings, because of the experience which he has had as a postal official, was made by Mr. W. S. Shallenberger, who had served several years in Congress as a member of the Committee on Postoffice and Postroads. Mr. Shallenberger was for a number of years Second Assistant Postmaster General, and now represents the Interdenominational Publishers who issue Sunday school literature throughout the United States. This witness gave it as his opinion that an increase in the rate on second-class matter would cause magazines and newspapers to avail themselves of the facilities now offered by the express companies which are becoming active competitors of the government in transporting second-class matter, these corporations obtaining better rates from the railroads than is given to the government. Mr. Shallenberger expressed the view that since every civilized nation was cheapening the cost of postal service the fact that our country was seeking to increase the rate seemed to be reactionary.
Mr. Shallenberger served under six Postmaster Generals and all of these held that the government was carrying second-class matter at a loss. But his opinion was that there was a substantial profit in the present rate, at the same time condemning the idea that each particular schedule should be made to pay its own way, the stimulus toward encouraging other schedule receipts not being given its proper consideration. Mr. Shallenberger gave a hint concerning hidden influences seeking to have the second-class rate increased but did not enter deeply into this phase of the subject. The controversy between Mr. Shallenberger and Second Assistant Stewart was animated and prolonged, and touched on features connected with the compensation paid railroads for hauling the mail, the express companies getting better terms than the government, this statement being made by a representative of the Postal Progress League.
The strongest point the publishing interests made was when the superintendent of the railway mail service, Chas. H. McBride, testified that a considerable part of the estimate upon which the department’s figures are based is guesswork and assumption, he admitting that if this were so the result would not be greatly different from what the officials first claimed. On the whole SuperintendentMcBride’s testimony was calculated to show that the Postoffice Department was desirous of making out a case against the second-class schedule, however necessary it was to twist figures and conceal facts in order to do so.
Mr. Wilmer Atkinson, publisher of Farm Journal, Philadelphia, combated the contention of the postoffice officials, as shown in their statements and tables, and declared with much emphasis that second-class matter stimulated first-class postage receipts. The statement of the cost of carrying second-class matter, placing it at nine cents a pound, is, according to him, “only a stereotyped guess that goes into the postoffice department report, each year,” experts having repeatedly stated that there is no possible way of fixing the cost of carrying second-class mail. In the opinion of Mr. Atkinson the government could better afford to carry it free than not to carry it at all. “Gumption and common sense,” declared Mr. Atkinson, “should rather be applied than indulging in worthless guessing.”
Representatives of scientific publications, college journals, fashion papers, fraternal societies and trade periodicals appeared before the members of the commission during the sessions, and all entered emphatic protests against the increase. In numerous instances these interests made the statement that serious reverses would be encountered if the postage rate should be doubled, and that many publications would be forced to suspend.
The labor union press, an interest representing about 250 weekly and monthly publications, with a circulation approximating 1,250,000 copies was officially represented by President Samuel Gompers of the American Federation of Labor, and President Matthew Woll, of the Photo-Engravers’ Union. Mr. Gompers entered vigorous protests against discriminations against labor publications and registered a severe censure of the method by which the Postoffice Department had hampered the official journals of the labor people. Mr. Gompers stated that the publications of the American Federation of Labor and its auxiliaries were all highly educational in their character and, in the event of an increase in the item of postage to the extent of 100 per cent additional, many of the best would be driven out of business with corresponding loss to the men individually and to the nation as a whole. Mr. Gompers’ declaration was listened to with much interest.
President Woll dwelt on the far-reaching effect which the hampering of the labor press would have on the manifold business relationships involved in the printing industry, primarily directing attention to the more than a third of a million of workers in the printing trades alone. He then advanced to the foundation of the paper and machinery features of the proposition, viz., from the ore in the mine, from which the machinery was made, to the forest tree from which the pulp is ground. The tonnage of the transportation service of the country would at once be doubly interfered with, first in a reduced demand for material with which to make the paper and, secondly, the corresponding decrease in the weight of the finished product of the publications. In many features Mr. Woll made prominent the ideas which the “Postal Riders and Raiders” is promoting, includingthe educational features of the immense volume of printing which comes from the printing press in all sections of the country.
The commission adjourned, subject to the call of Justice Hughes. However, it is understood that it will be called together in time to prepare its report to President Taft and to Congress when the session opens in December, 1911.
FOOTNOTES[6]Mr. Hitchcock, it should be noted, is careful in giving the higher per cent. of rate which the third and fourth classes show above the second class rate. Beyond the bare statement that the expense of handling second class matter “is less” than for other classes, he says nothing of cost of carriage and handling. His own figures show (see preceding paragraph), that the cost of carriage and handling first-class matter is 422 per cent. higher than his own absurd cost-figure of 9 cents a pound (cost) for carriage and handling second-class and4600 per cent. higher than the present second class rate.[7]Mr. Suter must certainly have been wind-jamming a little. “Every man, woman and child” pays at a maximum rate of 2 cents an ounce or fraction thereof. That is at the rate of 32 cents a pound. Mr. Hitchcock’s figures assert, that it costs “47 cents a pound” to carry and handle the letters for “every man, woman and child”—that is, presuming they all write letters. The letter writers, it appears then, pay only 2 cents for a service which costs nearly 3 cents.
[6]Mr. Hitchcock, it should be noted, is careful in giving the higher per cent. of rate which the third and fourth classes show above the second class rate. Beyond the bare statement that the expense of handling second class matter “is less” than for other classes, he says nothing of cost of carriage and handling. His own figures show (see preceding paragraph), that the cost of carriage and handling first-class matter is 422 per cent. higher than his own absurd cost-figure of 9 cents a pound (cost) for carriage and handling second-class and4600 per cent. higher than the present second class rate.
[6]Mr. Hitchcock, it should be noted, is careful in giving the higher per cent. of rate which the third and fourth classes show above the second class rate. Beyond the bare statement that the expense of handling second class matter “is less” than for other classes, he says nothing of cost of carriage and handling. His own figures show (see preceding paragraph), that the cost of carriage and handling first-class matter is 422 per cent. higher than his own absurd cost-figure of 9 cents a pound (cost) for carriage and handling second-class and4600 per cent. higher than the present second class rate.
[7]Mr. Suter must certainly have been wind-jamming a little. “Every man, woman and child” pays at a maximum rate of 2 cents an ounce or fraction thereof. That is at the rate of 32 cents a pound. Mr. Hitchcock’s figures assert, that it costs “47 cents a pound” to carry and handle the letters for “every man, woman and child”—that is, presuming they all write letters. The letter writers, it appears then, pay only 2 cents for a service which costs nearly 3 cents.
[7]Mr. Suter must certainly have been wind-jamming a little. “Every man, woman and child” pays at a maximum rate of 2 cents an ounce or fraction thereof. That is at the rate of 32 cents a pound. Mr. Hitchcock’s figures assert, that it costs “47 cents a pound” to carry and handle the letters for “every man, woman and child”—that is, presuming they all write letters. The letter writers, it appears then, pay only 2 cents for a service which costs nearly 3 cents.
Now, let us look into and over that postoffice “deficit,” to the origin of which the memory of man scarcely runneth back, and which Mr. Hitchcock, by some strenuous effort onrightlines readily converted into a surplus—a $6,000,000 deficit into some hundreds of thousands of dollars surplus. The returns are not all in yet. At any rate the Postmaster General has not announced them loud enough for The Man on the Ladder to hear, or he was in his physician’s hands when the announcement was made.
However that may be, Mr. Hitchcock has proved quite conclusively that there is no deficit—or, at least, no valid reason for one under present conditions.
And here, again, I desire to say that our present Postmaster General is deserving the praise or commendation of every American citizen for having demonstrated, by a few economies here and a few betterments there in the operation of his department, that the servicecanbe rendered, and rendered efficiently, with an expenditure safely within the bounds of the department’s receipts or revenues.
Especially is Mr. Hitchcock deserving of commendation for this demonstration, because in making it he has done what so many of his predecessorstalked of as desirable, but failed to do.
But with full acknowledgment of the splendid effort Mr. Hitchcock has made in converting a postal deficit of $6,000,000 in 1909-10 into a surplus for the year 1910-11, I desire to discuss, briefly, postal department deficits of the past—or the future—and the origin and cause of them.
In the future pages of this volume little if any reference will be made to our vigorous Postmaster General’s attempt to put onto the Senate course a rider that would run down certain periodicals which were to him and certain of his friends, as it would appear, of obstructive if not offensive character. It is possible, if, indeed, not probable, that I may, in this somewhat hurried discussion of our Postoffice Department deficits and their sources, cause and origin,repeat something, in whole or in part, that I have said elsewhere in this volume.
The discussion of the postal deficits leads us into theRaiderfactor or feature of our general title—into a consideration of the political, partisan and business influences and interests which have for thirty-five or more years been conspicuously—yes,brazenly—looting the revenues of the department. I shall not be able to advert to all such influences, interests and persons. Especially can I not mention some of thepersons. Many of them have gone to “their reward”—or to their punishment—as the Almighty has seen fit to assign them. As a matter of venerable custom and of current conventional courtesy we must leave them to His justice—to our silence. One by one many of thedishonestly enrichedfrom our postal revenues have dropped into “the dead past,” which Christ instructed should be left to “bury its dead.” In our treatment of this subject we shall obey the Master’s instruction—we shall discuss methods, practices, andacts, not men.
In turning to our subject directly, I desire to make a few positive statements or declarations.
1. The Postoffice Department is a public service department—a department intended to serveall the people all the time.
2. The people are paying, have paid, and arewilling to pay, for their postal service.
3. The people do not care—never have cared—whether the expenditures exceed the receipts by $6,000,000 or $100,000,000,if they get the service for the money expended.
In comment on the last, I wish here to ask if anyone has heard much loud noise from the people about the army and the navy expenditures—expenditures larger than that of any other nation on earthfor similar purposes?
Yet, for twenty or more years, the people have paid the appropriations for—also met the “deficit” bills of—each of those departments without any noticeable “holler.”
But, again, it must be pertinently asked, what have the people received in return for theirbillionsof expenditures for those two departments?
Yes, what? They have had the doubtful “glory” of having their armydebauchsome island possessions, maneuver for local entertainments and do some society stunts while on “post leave”—which“leave”, for epauletted military officers, appears to have occupied most of their time.
And the people have put up, ungrumblingly, $100,000,000 to $150,000,000 or more (I forget the figures), for a navy—a navy carrying on its payrolls more “shore leave” men and clerks than it has service men. (At any rate that was the showing in a recent year). For this vast expenditure of their money the people got—got what?
Well, for their hundreds of millions expenditure on that navy of ours, the people, to date, have received in returnnewspaper reportsof numerous magazine and gun explosions with, of course, a list of the killed and wounded, and reports of “blow-hole” or otherwise faulted armor plate, turrets, etc., of raising “The Maine,” of shoaling this, that or the other battleship, or of “sparring” or “lightering” off, to the music that is made by a “blow-in” of fifty thousand to two or three hundred thousand more of their money.
Reader, if you read—if you have read—the “news”—the periodical literature—of those past twenty years, you will know that the people have received little or no returns for the vast expenditure of money—oftheirmoney—that their representatives (?) have made for the Navy Department.
Oh, yes, I remember that our army and navy fought to a “victorious” conclusion the “Spanish American” war.
No patriotic American citizen alive at the time that war occurred will ever forget it. He will ever remember Siboney, Camp Thomas, Camp Wycoff, and the cattle-ship transports for diseased and dying soldiers. He will also remember the “embalmed beef” and the “decayed tack” and other contracts and contractors.
If the patriotic citizen has been an “old soldier,” or is familiar with the history of wars, he will also know that, if the whole land fighting of that Spanish American war was corralled intooneaction that action would be infinitely less sanguine than was the action at a number of “skirmishes” in our civil war—that, if the several naval actions of that war were merged into one, it would not equal, in either gore or naval glory, Farragut’s capture of Mobile, the action in Hampton Roads, nor even Perry’s scrimmage on Lake Erie in 1813.
What has all this to do with the postal department deficit, some one may ask? It has just this to do with it:
If a people stand unmurmuringly for the expenditure ofbillionsfor a service that yields them no return, save a protectionthey have not neededand of doubtful security if needed, that people is not going to raise any noisy hubbub over a dinky deficit of a few millions a year for a service which should serve themevery day of every year.
I have expanded a little, not disgressed, in writing to my statement numbered 3. I will now proceed with my premeditated statements. Some of them may be a little frigid, but none of them are cold-storage. Some one may have told it all to you before, but that is his fault, not mine. He merely beat me to thefacts.
4. As stated in a forward page of this volume, the people of this nation want and demandserviceof its Postoffice Department. They care not to the extent of a halloween pea-shooter whether the service is rendered at a deficit of six million or at a surplus of ten million,if service is rendered for the money expended.
5. The people of this country will object more strenuously against asurplusin their postal revenues—their service tax—than they ever have or will object to a deficit in the revenues of that service,if they get the service.
6. The Postoffice Department is not understood—is not even thought of by intelligent citizens—as arevenue-producingdepartment. Itisunderstood to be aservicedepartment, and the citizen—His Majesty, the American Citizen—is always willing to pay for services rendered.
7. The Postoffice Department has not in the period named—no, not for thirty or thirty-five years—rendered the citizen the service for which he paid.
I mean by that, of course, that the citizen has been compelled to pay far more for a postal service than heshould have paid for that service.
8. Had that service beenhonestly, faithfully and efficiently rendered, the price the citizen has paid for itwould have left no deficit for any year within the past thirty.
9.The only deficits in those thirty or thirty-five years have been the result of manipulated bookkeeping, of political trenching into the revenues of the department, of loose methods in its management, of disinterest in the enforcement of even loose methods, and of downright lootage and stealings.
“Rather harsh that, is it not?” asks one.
“Mere assertion,” says another
To the first I need only say that this is an age not congenial to milk-poultice talk. I have previously expressed my opinion on that point. If you have a thing to say, say ithard. The majority of people will then understand you. Those who do not understand you can continue their milk poultices—or believe and talk as they are toldor are paid to believe and talk.
The latter—the reader who yodles that my preceding nine statements appear to be assertions only—can make a courteous and, possibly, a profitable use of an hour’s leisure in reading a few following pages, before herustsinto the belief that those nine “assertions” are groundless assertions.
In showing that there is no “deficit”—a shortage of receipts in the Postoffice Department over its legitimate expenditures—I shall not take my nine statements up seriatim, but present my reasons in a general way for having made such blunt declarations. I may go about that, too, in an awkward way, but the reader who follows me will get my reasons for making those nine declarations.
If the department of public works in Chicago does a piece of bricklaying, concrete or other construction work for the police, fire, health or other department of the city government, or if it carts or hauls away some excavated material or razed debris for any of those other departments, the service rendered is made achargeby the department of public worksagainstthe department for which the service is rendered.
What is true in this instance in Chicago’s municipal government is true of every other city or incorporated town in this country that has its service departmentized.
If the County Commissioners of McCrackin county build a bridge or culvert for Ridgepole township in the county the cost of constructing that bridge or culvert (or a proportional share of it, if on a general highway), is made a charge against Ridgepole township.
If the transportation department of the United States Steel Corporation delivers the services of three steam tugs (services rated at $30.00 per day) to the corporation’s smelting or rail departmentsthere is a credit of $90.00 given to the transportation department, and a correspondingcharge made against the department for which the service is rendered, for each day’s service rendered.
That states a recognized business rule and practiceamong both private and public corporations. Its valid andjustpurpose is to prevent the loading upon one department (any one department) the expenses created or incurred by another.
Is it not a valid, fair and just method of business?
If it is not, then the largest merchants, the most productive and profitable manufacturing establishments, transportation companies, banking and other mercantile, industrial and financial institutions have not discovered the fact.
If the owner of an Egyptian hen ranch had a shrinkage in his castor bean crop, he would not think of charging the cost or loss on those castor beans up to his hens, would he? Hens do not eat castor beans. That is useless—well—yes, of course. Well, hens do not eat castor beans, anyway. So my ill-chosen illustration, though may stand—stand anyway until someone finds a breed of hens which likes castor beans.
But, if the hens of that hen-rancher invaded his vegetable garden, scratched up his set onions and seeded radishes, pecked holes in three hundred heads of his “early” cabbage and otherwise damaged the fruits of his labor, care and hopes—likewise disarranged his figures on prospective profits—if the hens did that, that hen-rancher would most certainly charge his loss to the hens, would he not?
That is, he would do so, if the hens had attended to their legitimate business as industriously as they looked after his vegetable garden and, by reason of that legitimate effort, showed a “profit balance.” The preceding is based, of course, on the assumption that the rancher has acumen enough to distinguish a hen from a rooster and a sunflower from a cauliflower. If he is so wised up, whether by experience and observation or by academic training, he will most certainly charge his loss on vegetables against those hens.
“What is the application of all this to the Postoffice Department deficits?” some one is justified in asking.
Well, my intended application of it is, first, to show a generally recognized and practical business method—a business method practiced by both public and private corporations and by individuals andfirms, from the hen-rancher to the department store. My second purpose is to show that this almost universally recognized business method has been and istotally ignored in conducting the vast service affairsof the Federal Postoffice Department.
The 1910 report of the Postoffice Department states that 55,639,177 pounds of second-class mail was carried and distributedfreein the counties of these United States.
Of course, this 1910giftto country publishers is the result of a moss-grown custom—a custom born of an ingrown desire common to crooked politicians—a desire to trade the general public service forprivateservice. All the second, third and fourth class cities in the country, as well as a majority of our towns and larger incorporated villages, have theirpartynewspaper or newspapers.
Comparatively speaking, few of them have any extensive telegraphic service, if any at all, in the gathering of news. Those which have not, capture the early morning editions—or the late evening editions of the day before—of two or more metropolitan papers, “crib” their “news” and deliberately run it, in many instances, as special wires to their own sheets. In some cases, which I have personally noticed, that practice was indulged when their own “newspaper” consisted of but two to four locally printed pages reinforced by a “patent inside.” Why should such newspapers (?) be given “free distribution” in the county of publication?
They contain little if any real news and less matter of any real informative or educational value. True, the most of them do publish a “local” column or half column of “news” for each or for several of the outlying villages in the county of publication. These “local news” columns inform the reader that “Mr. Benjamin Peewee circulated in Boneville on Wednesday last;” that “Mrs. Cornstalk and her daughter Lizzie are spending the week at the old homestead, just south of town,” that “Mr. Frank Suds shipped a fine load of hogs from Bensonville on Friday of this week,” etc., etc.
Most edifying “news” that, is it not? So didactic and brain-building, is it not?
Now, why should the Postoffice Department carry those millions of pounds of Reubenville sheetsfree?
The department report says it carried about 56,000,000 pounds of such “periodicals” free last year. The figures for this year (1910-11) will probably be around 60,000,000 pounds.
Why should the department give away $600,000 in revenues?
Besides that,the department does not know how much of this“free in county” matter it does carry and distribute. Of course, it may be able to make a more dependableguessat the total tonnage of such second-class matter than can I. However, any one who has been around the “county seat” or the “metropolis” of any of the “hill” or “back” counties during a county, state or national canvass for votes will know that the postmaster’s scales are often sadly out of balance when he weighs into circulation the local newspaper. In fact, it frequently happens that he does not weigh it at all—especially not, if it be an extra or extra large edition issued “for the good of the party”—and more especially not, if the edition is issued to servehisparty.
“It goes free anyway, so what is the difference?” the postmaster may argue, and with fairly valid grounds for such argument. The department, acting, pursuant of law, says “carry and distribute your local papersfreeinside your county.” So what difference does a few hundred or a few thousand pounds, more or less, make to the department?
Why, certainly, what difference can it make? It is all done for “the good of the party,” is it not?
This condition, governing, as I personally know it does govern, furnishes my chief reason for saying that the Postoffice Department doesnotknow—does not know even approximately—the tonnage of the “free in county” matter it handles. It never has known and does notnowknow, withinmillionsof pounds, the weight of such matter it carries and distributes.
Again, I ask, why is this vast burden thrown onto the department and the department getting not a cent of either pay or credit for carrying it? Is it because of a paternal feeling our federal government has for the poor, benighted farmers of the country? I can scarcely believe it is. The farmers of this country are neither poor nor are they benighted. If they were, free carriage and distribution to them of these local sheets has not enriched them to any appreciable extent, however much such free carriage and delivery may have addedto the bank accounts of the publishers of such periodical literature. Besides, ninety-five in every hundred farmers whose names are on the publishers’ subscription bookspay their subscriptions. They usually pay, too, a pretty stiff rate—$1.50 or $2.00 for a “weekly,” which gives them mostly borrowed news and much of it decidedly stale at that. If a beneficent government grants its “free in county” postal regulation with a view to dissipating the gloom which clogs the garrets of our “benighted farmers,” that government misses its purpose on two essential points. Our farmers, as previously intimated, are no more benighted than are the residents of our villages, towns and cities, and even if their ignorance was as dense as a “practical” politician’s conscience, the medium which the Government delivers to them, carriage free, seldom contributes much enlightenment.
No, it was not for either the enrichment or the enlightenment of the dear farmer that the present “free in county” postal regulation was made operative. It was to give some local party henchman a fairly profitable job as publisher of a county newspaper—a party newspaper—and to have, in him, a county “heeler” who would divide his time between building the party fences and telling the dear farmer how to vote.
It is due to the publishers of country newspapers to say, that hundreds of them have grown away from rigid party ties—have grown independent. It is also but just to say that as these publishers have grown independent of party domination, their newspapers have improved. We have now many most excellent country papers published in our “down state” cities and larger towns.
The points I desire to make, however, are, first, the “free in county” mail delivery regulation was originally adopted for partisan political purposes, not to serve the farmer residents of the counties, and, second, that such regulation is unjustly discriminating and is raiding the service earnings of the Postoffice Department to the extent of at least six hundred thousand dollars annually. In my opinion such raiding will reach seven or eight hundred thousands a year.
Going back now to that generally recognized and practical business method referred to and which the government persistentlyrefuses or neglects to adopt in handling and directing the fiscal affairs of its Postoffice Department, we find another raid on that department’s revenues.
Third Assistant Postmaster General, James J. Britt, makes a sort of estimate of the amount of free second-class matter of Government origin the Postoffice Department transported and distributed during the fiscal year ended, June 30, 1910. Mr. Britt places the figure at 50,120,884 pounds.
Mr. Britt’s estimate is based on a six months’ weighing period in 1907 (the last half of that year.) It is reported as a “special weighing” and showed 26,578,047 pounds of “free in county” second-class matter and 23,941,782 pounds of free franked and penalty matter of the second-class. Mr. Britt then proceeds (page 335 of the department report for 1910), to arrive at his estimated tonnage of franked and penalty matter by assuming that the weight ratio of such second-class matter to “free in county” matter would be about the same for 1910. He says: “If, as it seems reasonable to believe, the relative proportions of this character of matter have remained the same,” there would result for the fiscal year 1909-10 the figures he gives for the franked and penalty tonnage, or 50,120,884 pounds.
Well, to The Man on the Ladder it doesnotseem “reasonable to believe” that such method of estimating is sound nor the tonnage result attained by it dependable. The year 1907 was a decidedly off-year in franked matter of the second-class. The then President kept most of the Senators and Congressmen guessing as to just what he intended to do in the matter of the presidential nomination of his party. In fact, he kept a goodly number of federal legislators guessing on that point until well along in 1908. The result of this condition of doubt was greatly to lessen the franked mailings and also reduced in material degree the mailing of departmental, or “penalty” matter of the second-class.
For this and several other reasons, the tonnage of franked and penalty matter reported as carried in the last half of 1907—even if the “special weighing” Mr. Britt mentions was accurate and dependable, which itwasnot and could not be, either then or now, under the lax methods by which such weighings were and are made—the reported weight of such franked and penalty matter carried in the lasthalf of 1907 furnishes no fair or safe basis upon which to predicate 1910 totals or to base a dependable estimate of them.
Another defective factor is used in Mr. Britt’s estimate—the reported total weight of “free in county” second-class matter as ascertained by special weighing in the last half of 1907. As previously stated in discussing the raid of six to eight hundred thousand dollars a year made upon the postal service revenues by this “free in county” matter, the department’s reported figures for it are little more than a robustguessat its tonnage, even now, and the figures given for 1907 are much less trustworthy than are the department’s estimates and guesses for the fiscal year ended in 1910. Whatever may be said of its faults and faulty purposes, it is but simple justice to say the present departmental administration has shown more judgment and activity and has put forth more strenuous effort to get to the bottom of things and at dependable facts in mail weights than has been shown by any of its recent predecessors.
Still, I repeat that its reported figures for the total tonnage of “free in county” for carriage and delivery of second-class mail matter are not sufficiently reliable to warrant their use as a basis for making a dependable estimate of the tonnage of another free division of second class mail. Especially unreliable are the figures reported as total tonnage of free-in-county-matter as a basis for estimating the tonnage of a division of the service so far removed from “free in county” as is that of free franked and penalty matter.
All that aside, however, the fact is the Postoffice Department should receive credit for every pound of franked or penalty matter it handles for the legislative and other departments of the government service.
Mr. Britt himself appears to recognize the force of that fact. On page 335 of the department report for 1910, he speaks as follows: