report of the Secretary of the Navy presents a full and
satisfactory account of the condition and operations of the naval
service during the past year. Our citizens engaged in the legitimate
pursuits of commerce have enjoyed its benefits. Wherever our national
vessels have gone they have been received with respect, our officers
have been treated with kindness and courtesy, and they have on all
occasions pursued a course of strict neutrality, in accordance with the
policy of our Government.

The naval force at present in commission is as large as is admissible
with the number of men authorized by Congress to be employed.

I invite your attention to the recommendation of the Secretary of the
Navy on the subject of a reorganization of the Navy in its various
grades of officers, and the establishing of a retired list for such of
the officers as are disqualified for active and effective service.
Should Congress adopt some such measure as is recommended, it will
greatly increase the efficiency of the Navy and reduce its expenditures.

I also ask your attention to the views expressed by him in reference to
the employment of war steamers and in regard to the contracts for the
transportation of the United States mails and the operation of the
system upon the prosperity of the Navy.

By an act of Congress passed August 14, 1848, provision was made for
extending post-office and mail accommodations to California and Oregon.
Exertions have been made to execute that law, but the limited provisions
of the act, the inadequacy of the means it authorizes, the ill
adaptation of our post-office laws to the situation of that country, and
the measure of compensation for services allowed by those laws, compared
with the prices of labor and rents in California, render those exertions
in a great degree ineffectual. More particular and efficient provision
by law is required on this subject.

The act of 1845 reducing postage has now, by its operation during four
years, produced results fully showing that the income from such reduced
postage is sufficient to sustain the whole expense of the service of the
Post-Office Department, not including the cost of transportation in mail
steamers on the lines from New York to Chagres and from Panama to
Astoria, which have not been considered by Congress as properly
belonging to the mail service.

It is submitted to the wisdom of Congress whether a further reduction of
postage should not now be made, mo