at which time it may be said
that of the present naval force nothing worthy the name will remain.

All the vessels heretofore authorized are under contract or in course
of construction except the armored ships, the torpedo and dynamite
boats, and one cruiser. As to the last of these, the bids were in excess
of the limit fixed by Congress. The production in the United States of
armor and gun steel is a question which it seems necessary to settle
at an early day if the armored war vessels are to be completed with
those materials of home manufacture. This has been the subject of
investigation by two boards and by two special committees of Congress
within the last three years. The report of the Gun Foundry Board in
1884, of the Board on Fortifications made in January last, and the
reports of the select committees of the two Houses made at the last
session of Congress have entirely exhausted the subject, so far as
preliminary investigation is involved, and in their recommendations they
are substantially agreed.

In the event that the present invitation of the Department for bids to
furnish such of this material as is now authorized shall fail to induce
domestic manufacturers to undertake the large expenditures required to
prepare for this new manufacture, and no other steps are taken by
Congress at its coming session, the Secretary contemplates with
dissatisfaction the necessity of obtaining abroad the armor and the gun
steel for the authorized ships. It would seem desirable that the wants
of the Army and the Navy in this regard should be reasonably met, and
that by uniting their contracts such inducement might be offered as
would result in securing the domestication of these important interests.

The affairs of the postal service show marked and gratifying improvement
during the past year. A particular account of its transactions and
condition is given in the report of the Postmaster-General, which will
be laid before you.

The reduction of the rate of letter postage in 1883, rendering the
postal revenues inadequate to sustain the expenditures, and business
depression also contributing, resulted in an excess of cost for the
fiscal year ended June 30, 1885, of eight and one-third millions of
dollars. An additional check upon receipts by doubling the measure of
weight in rating sealed correspondence and diminishing one-half the
charge for newspaper carriage was imposed by legislation which took
effect with the beginning