Compensation Payment Act. The amount granted is allocated as follows:

A total of 36,086,173 bonds of $50 denomination were issued under the provisions of the act up to April 17 last. Of this number 27,817,848 had been paid through the Treasurer's Office and the Public Debt Service, leaving 8,268,848 outstanding. Of the 27,817,848 paid, the Public Debt Service has examined approximately 25,000,000 leaving 2,817,848 still to be handled. The work of the Public Debt Service also involved the settlement of cases of deceased and incompetent bond owners of which 16,500 have been received and 12,500 disposed of, leaving unsettled 4,000 of such cases. The Treasurer's Office up to April 17 had examined 27,700,000 bonds and paid 7,723,000 checks and still has left to handle 8,268,325 bonds. The dollar volume of the payments in the aggregate involved $1,804,000,000 of which $1,390,000,000 has been paid leaving $413,000,000 outstanding. The work of the Post Office Department has been largely performed but unpaid for. It consisted of certifying and checking bonds and preparing and mailing checks. To date expenditures incurred by the Post Office Department and not reimbursed total $562,000 to February 28. The amount included in the above appropriation is largely in payment for services already rendered.

POST OFFICE DEPARTMENT

There is recommended for the Post Office Department a total of $14,172,500. Of this amount $334,000 is to meet incurred deficiencies for the fiscal year 1936, $488,500 is for the fiscal year 1938, and $13,350,000 is for the fiscal year 1937.

The amount of $334,000 for the fiscal year 1936 is for the payment of special-delivery fees, rewards for the capture of mail robbers, and for payment of domestic air-mail transportation in amounts actually incurred and unpaid.

The total of $13,350,000 is composed largely of two items$6,000,000 for clerks and employees at first- and second-class offices and $4,500,000 for railroad transportation of the mail. The supplemental total is occasioned by the increase in the volume of the postal business and is all necessary to keep the service functioning until the close of the present fiscal year.

The situation with respect to postal revenues and expenditures for the present fiscal year is gratifying. With the increase of revenues that has taken place, it now appears that gross receipts for the year will total $720,000,000 and gross expenditures will be $771,500,000, a gross deficit of $51,500,000. However, against this gross deficit there is a permissible deduction under existing law of the nonpostal items totaling $51,500,000, leaving a practical balance between revenues and the cost of the service which is rendered for hire.

The item of $488,500 for the foreign mail transportation for the fiscal year 1938 is to cover the installation of two additional air mail

routes in South America in the interest of our foreign trade on that continent. The proposed route on the west coast is 1,773 miles, extending from Arequipa, Peru, via La Paz, Bolivia, to Buenos Aires, Argentina, giving service through Bolivia not heretofore rendered by an American line. The rate proposed is $1.70 per mile for southbound schedules and $1.30 per mile for north-bound schedules through an extension of the contract with the present holder, Pan-AmericanGrace Co., at a total annual cost of $194,500. The route on the east coast is proposed from Rio de Janeiro, Brazil, through Asuncion, Paraguay, and down to Buenos Aires, a distance of 1,507 miles at $1.80 per mile, at a total cost of $294,000, service to be performed by the holder of the present contract on the east coast, the Pan-American Airways. The east coast route will go through Paraguay not heretofore reached by an American line.

The necessity of these routes from the standpoint of maintenance of American trade and commercial interest and friendly relations in South America is stressed as the urgent necessity for their establishment at this time. The importance of this step was brought to the attention of the committee by Hon. Harllee Branch, Second Assistant Postmaster General, who appeared in behalf of the estimate and whose testimony will be found in part in the printed hearings. In addition the committee has been furnished a memorandum by Hon. R. Walton Moore, Assistant Secretary of State, from which the following is an essential extract:

It has long been the policy of the United States to foster and develop economic and political relations with the Latin American Republics. The importance of United States trade with these countries is well known. The investment of United States capital in Latin America amounts to several billions of dollars, and this area is generally considered of vast promise for future commercial expansion to the benefit of all the countries concerned. Similarly, in the political field, this Government, in recent years more than ever, has felt the importance of close friendship and intimate cultural relations with our Latin American neighbors. The recent Inter-American Conference at Buenos Aires emphasized the importance of trade relations among the American nations, and one of the chief bases for its program was the consideration of all measures which would improve communications.

Adequate air-mail and air-transport facilities are of material assistance in building up international trade and promoting better understanding between peoples of different nations. Nations which are far removed from each other geographically are brought into close proximity in point of time by the establishment of efficient air services. Air communication between the United States and Latin America is particularly advantageous and necessary because of the great distances to be traversed. The time saved by air as compared to steamship travel between New York and Buenos Aires amounts to approximately 13 days, and an additional saving would be made by the establishment of the proposed service through Bolivia. As a result of the establishment of these facilities, businessmen and statesmen now travel between the two continents with a frequency never before even dreamed of.

In establishing air communication with South America, United States aviation interests have accomplished a piece of work which is of fundamental importance. No phase of United States commercial activity in the American Republics has, in many years, done so much to enhance the prestige of the United States in this hemisphere. These interests have successfully overcome great obstacles in establishing direct air-mail services to all the countries of Latin America except Bolivia and Paraguay. It is now proposed to include these last two countries on the through services. The establishment of the proposed routes should be of great benefit to the relations of the United States with these countries.

At present, European aviation interests, heavily subsidized by their respective governments, are making a determined effort to secure a substantial proportion of the business now in United States hands. These foreign services are attempting to expand rapidly throughout the continent, and their activity makes it incumbent

upon our aviation interests to do everything possible to preserve their present predominant position, as well as to prepare for the future. The establishment of the proposed new services would be a valuable asset in this connection.

Without this support from the Government at this concise stage, it seems highly unlikely that the United States aviation interests can retain their present position, much less expand into new activities. For that reason, as a matter of national policy, it seems to be of the utmost importance that our aviation interests be accorded the fullest measure of support which present legislation makes possible and which Congress will authorize. The situation is so urgent that this year may mark the turning point one way or the other-whether United States aviation interests will maintain their present outstanding position, to the obvious advantage of inter-American relations; or whether non-American interests will obtain a preponderant position in this field.

NAVY DEPARTMENT

The committee has disapproved a Budget estimate of $860,000 additional for fuel and transportation for the Navy for the current fiscal year. The amount appropriated in the regular Naval Appropriation Act for this purpose for 1937 is $8,437,460. Out of this sum it was estimated that the Navy would need to procure 8,104,857 barrels of fuel oil for the fiscal year 1937 at an estimated average cost of $0.7875 per barrel. The deficiency estimate is predicated upon the procurement of the same number of barrels at the increased average price for the year of $0.9011. The Budget estimate (H. Doc. No. 199 of the present session) is predicated upon the assumption that the Navy will consume the entire estimated number of barrels. The committee is unable to join in this assumption. The Department has repeatedly carried to surplus considerable unexpended balances under this appropriation. The consumption of oil in past years has not been up to the needs estimated when the funds were being requested. With requirements for this fiscal year stated at 8,104,000 barrels, the consumption in the first 6 months of the fiscal year was only 3,316,000 barrels. While it is true that consumption in the second 6 months of any year is uniformly heavier than in the first 6 months, it does not seem reasonable, by comparison of the 6-month periods of previous fiscal years, that approximately 1,500,000 more barrels will be used in the second 6 months of this fiscal year than in first 6 months. The greatest excess of consumption for any second 6 months' period over the first 6 months in any of the four previous fiscal years to 1937, was approximately 650,000 barrels. The committee believes that the present appropriation contains sufficient money to provide all the fuel oil that will be consumed in the present year. The following table indicates fuel oil actually expended in 6-month periods for the fiscal years 1933, 1934, 1935, and 1936, and the first 6 months of 1937, and the quantity estimated for the last 6 months of 1937:

1 During the first 6 months of the fiscal year 1935 a large part of the fleet returned to the west coast from the east coast. These vessels took a large quantity of high-priced east coast oil.

? Estimated.

MISSISSIPPI RIVER FLOOD CONTROL

The sum of $1,000,000 is recommended to be restored to the appropriation for flood control on the Mississippi River. The flood on the Ohio River this year was successfully passed down the Mississippi River without a break in the levees and without destroying the town of Cairo, Ill. This was accomplished by emergency work of topping the weak points in the levee and opening up of the Bird's Point-New Madrid floodway. This required an expenditure of $4,169,000 from the existing appropriation that had not been foreseen. The appropriation made in this bill is to restore $1,000,000 to the existing appropriation from which these emergency expenditures were made and permit further repair of damages done by the flood, repair the break in the floodway, and carry on channel rectification work.

LIMITATIONS AND LEGISLATIVE PROVISIONS

The following legislative provisions are recommended in connection with the accompanying bill:

On page 2:

The appropriation for the United States Constitution Sesquicentennial Commission, contained in the First Deficiency Appropriation Act, fiscal year 1936, shall be available, in addition to the objects of expenditure for which available under existing law, for rent in the District of Columbia, individual photographs, books, periodicals, official cards, newspapers, newspaper clippings, purchase, maintenance, repair, and operation of a motor-propelled passenger-carrying vehicle, notarial seals, per-diem allowances in lieu of actual expenses of subsistence within and outside the District of Columbia, and including payment of obligations for the foregoing purposes heretofore incurred in connection with the work of such Commission.

On page 9:

Provided further, That in addition to the amount herein appropriated, the Tennessee Valley Authority is hereby authorized to incur obligations and enter into contracts for the procurement of equipment to be installed in dams and power-houses in an amount not in excess of $4,000,000, and this action shall be deemed a contractual obligation of the Tennessee Valley Authority and the United States for payment of the cost thereof.

On page 25, in connection with the appropriation for foreign-mail transportation:

Provided, That the limitations in such Act with respect to expenditures for the fiscal year 1938 and obligations for the fiscal year 1939 for carrying foreign mails by aircraft are hereby increased in the amount of $488,500.

On page 34:

Interchange of appropriations: Such part of any appropriation for the Coast Guard, contained in the Treasury Department Appropriation Act 1988, except the appropriations “Pay and allowances" "Civilian Employees", and "Salaries, Office of the Commandant", as may be necessary for freight and express charges on materials, supplies, and equipment, may be transferred, with the approval of the Director of the Bureau of the Budget, to the appropriation for contingent expenses of the Coast Guard in order to make such payments.

On page 36:

Travel of the Army: The appropriation “Travel of the Army, 1937" shall be available for expenses of travel, including per-diem allowances in lieu of subsistence of $2.75 each for the Corps of Cadets, United States Military Academy, the band, and necessary commissioned and enlisted personnel attending the inaugural ceremonies held in the city of Washington, District of Columbia, on January 20, 1937.

LIBRARY OF CONGRESS

148

Legislative Reference, printing digest of public general bills,