Department took the wise course of calling a conference of publishers and other large users of the mails for consultation with the officers of the department in devising what became the Act of 1879. The time has come when there should be a revision of postal arrangements with the public, not in the shape of piecemeal legislation, but in a well-considered and unified plan of reform which should command the respect of Congress and the people. The country needs a simple system of rates, a parcels post, a postal check, and the better arrangements with foreign post offices which they are eager to make. A useful pamphlet of "General Postal Information for the Public," recently issued by the Third Assistant Postmaster-General, and to be had free at the post offices, illustrates too well the present complexity. Perhaps the simplest system of postal rates, of most convenience to the Government and the people, would be somewhat as follows: For letters, 2 cents per ounce, drop-letters i cent; for postal cards, I cent; for periodicals from the office of publication and books from public libraries, in bulk, 1 cent per pound without local free delivery, and 2 cents per pound with local free delivery; for periodicals and books otherwise mailed, I cent for four ounces, 4 cents per pound and I cent for each added half pound; for all else, a simple parcels-post system, including local free delivery, at 1 cent for two ounces, 8 cents per pound, and 1 cent for each added half pound, with half-rate for rural free delivery from the local office and extra rates on the zone system for extreme distances on packages above four pounds; the abolition of the "county fee" system and the restriction of the franking privilege to distinctly official correspondence; and a foreign post, uniform to all countries of the Postal Union, in accordance with the general practice, comprehensive of the best features of the postal service of other countries. Such a scheme, reforming rather than revolutionizing present methods, classification, and rates, would greatly reduce the cost of the department, possibly increase its revenue to the self-supporting point, and permit in the future successive reductions of rates. The possibilities of the Post Office as an agent for the people's good are indeed great, and the present is a favorable time for giving to our own country a postal system which shall in no respect be behind those of less-favored nations.

POST OFFICE DEPARTMENT: MAIL FRAUD ORDERS

[The post office department is the agency through which the federal government comes into closest contact with the body of citizens. The efficiency of its operations as compared with those of private companies gives the citizens a general criterion for testing the effectiveness of public administration. The use of the mails is a valuable privilege, the withdrawal of which by the government may be made the instrument for punishing and preventing wrong. The postal authorities refuse to allow the mailing facilities to be used for the purpose of practicing schemes of fraud and deception. Controversy has recently

arisen about the procedure of the department in the matter of mail fraud orders, which will be illustrated by the following extracts.]

FRAUD ORDERS ISSUED BY THE POST OFFICE AUTHORITIES 1

NEW Schemes of deception invite new measures of prevention. This seems as apparent from a study of the Government's fraud-order business, as the history of burglary shows the growth of safety appliances. The Government has steadily tightened its rein over concerns using the postal service apparently for the purpose of cheating the public. This forms a valuable agency for the purification of advertising pages.

Uncle Sam has already issued 2,180 fraud orders. Assuming that each concern with a get-rich-quick scheme had 20,000 victims and this estimate of the average number seems modest· a number equal to onehalf of the entire population of the country has been victimized within the last fifteen years. There is no knowing how many innocent lambs have been saved by the postal shepherds from these wolves of small finance. A respectable minority of the American people might be placed under the designation "an easy mark." It is practically certain that the same fish must have risen repeatedly to the same shining bait, and fed fat the get-rich-quick fraternity. Otherwise there could not have been so many of them.

At first the executive departments of this Government dealt tenderly with persons having get-rich-quick schemes. "Fraudulent" lotteries only were under the ban of the law of 1872. The statute referred vaguely to false-pretence schemes, but executive officers ignored this part of it. The president of the famous Louisiana lottery company was No. 1 on the list of banned enterprise-managers, accessible in the dockets of the department. But a new law was necessary to put his undertaking out of business. "Fraudulent" was dropped in designating lotteries which were not to be permitted. The beneficent was added to the evil. After that all lotteries looked alike to the Government. Under the law which proved the beginning of the end for the gigantic Louisiana swindle, which for a generation had filched large sums from Americans with a speculative turn of mind, only registered letters and money-orders could be withheld. Subsequently the law was extended to include all mail

matter.

The Louisiana Lottery people took the case to the Court of Appeals of the District of Columbia, attacking the constitutionality of the law. Judge Cox in a long opinion upheld the law, taking the ground that the right of the citizen to use Government postal facilities for the transmission of mail, was not a constitutional right, but a legislative privilege, which must be utilized according to the conditions placed upon it by Congress.

1 New York Evening Post, April 25, 1905.

Lotteries, after the downfall of the Louisiana, have had a hard time in this country.

Judge Thomas, in President Cleveland's second Administration, had fraud orders issued against a number of persons whom he believed to have been acquiring money in tortuous ways. His practice was to issue the fraud order and have the mail held up on plausible complaint. Investigation came afterward. If the fraud order was found unwarranted, it was cancelled. This method was a trifle more summary than that of Judge Thomas's successors. Fraud orders are not now issued until the persons involved have had an opportunity to be heard.

As lotteries became scarce, the Post Office Department looked about for other game. It found some in the case of a patent-procuring concern. Would-be inventors, it seems, are almost as numerous as plain every-day "suckers." In many respects it is difficult to distinguish between these classes. The inventor furnished food for the patent concern. Putting it out of business by holding up its mail marks one of the earliest important cases decided on the ground of alleged fraud, or false-pretence, aside from the lottery element. This case was decided in 1897. Even that case was complicated by the disbarment of the head of the concern as a patent attorney.

Another famous case, turning upon alleged fraud and false pretence, was that of a concern, having headquarters at Fairfield, Me., which sold its victims materials and taught them to make artificial flowers. The flowers promised to be sources of great income to the victims, but they never quite arrived. Some defects appeared which could be cured by taking instruction in other lines, which the company would give for a consideration. After the victim discovered that the corn was musty and refused to follow further, he was dropped. A Federal judge, in passing upon this case, cast doubt upon the constitutionality of the whole FraudOrder law, but the company had come into an equity court with hands so unclean that he would not attack the law for its benefit.

Still another step in advance was taken in the case of a New York concern which had a scheme for selling fountain pens for $2.50 each, and employing at $8 a week in advertising letter-writing everybody who bought a pen. It was an endless-chain scheme, growing constantly wider. All revenues were derived from the sale of the pens. This inverted financial pyramid was not thought stable by the Post Office people, and the concern was put out of business by a fraud order, in October, 1902, after having secured 19,000 patrons.

A most gentlemanly scheme, having no end of imitators, started by a diamond company in San Francisco, came to grief about a year ago, through the squeamishness of the postal authorities. This was such a beneficent scheme, and the men behind the "graft" showed such pious good faith, that the Department actually apologized for being obliged to attack it, and point out its financial fallaciousness. It was proposed to

give a $160 diamond to everybody who would pay $80 in weekly instalments, thus putting each investor almost in the position of the chattel loan man. The company depended upon lapses to "make good." Postal authorities said that was impossible, and the honest promoters went under the shadow of the ban. All its fellows have followed suit. This seems the lineal descendant of certain bond-investment schemes, which at one time promised great possibilities.

Having gone to the limit in hunting down schemes of an alleged fraudulent character, the postal authorities swung back toward the lottery idea, as it invaded guessing enterprises. This included guessing for prizes as to the attendance at the St. Louis Fair, and guessing the number of ballots cast for Roosevelt or for Parker. These cases brought out last November an opinion by Attorney-General Moody, holding the FraudOrder law constitutional. Before that, attorneys-general held almost uniformly the opposite view. Mr. Moody followed the United States Supreme Court in the case of Public Clearing House against Coyne, and the New York Court of Appeals in the Lavin case. A formal judicial opinion had held that a cigarette guessing contest was legitimate. But Mr. Moody and the courts he followed found elements of lottery in guessing contests. He also found that the term "due process of law," in the Constitution, may mean hearing and action by an executive department, when the parties have recourse to the courts, if aggrieved.

As it now stands, the powers of the Post Office Department are most broad and sweeping. Racing schemes, bond investment schemes, employment schemes on the endless-chain plan, guessing schemes, and all other such devious devices for getting into the private pocket of the public, are banned. Not only are advertisers of such schemes in danger, but even the periodicals which run the advertisements may be excluded from the mails. It is not necessary for the Department to prove actual fraud, but it may act on proof of advertising a scheme of finance not feasible. Newspapers must look carefully at their circulation schemes. The Woman's World came to grief after landing $500,000 good American dollars.

Fraud orders grow by seasons. The harvest time is between September and May, when the good American, surrounded by his household gods, reads the alluring advertisements and becomes impromptu a financier. In 1899 fraud orders numbered 99; in 1901, 62, and in each of the years 1902 and 1904 they numbered 247. If one has visions of high finance, before plunging he may do well to ponder the warning: "The fraud order man will get you if you don't watch out."

SPEECH OF HON. EDGAR D. CRUMPACKER ON THE POST-OFFICE APPROPRIATION BILL1

MR. CRUMPACKER said:

Mr. Chairman: I will take advantage of the opportunity afforded by the debate upon this bill to submit some additional remarks upon the bill providing for a judicial review of fraud orders issued by the Postmaster-General, which passed the House some weeks ago. There seems to be some misunderstanding respecting the scope and purpose of that bill, based, as far as I am able to learn, upon a careless or willful misrepresentation of its provisions by individuals who seem to have little regard for the truth. It has come to be quite the fashion when any legislation is proposed that curtails or modifies power that is being exercised by a bureau officer in one of the Departments, however wise and just the measure may be, for some dilettante reformer who is long on theory and short on practical wisdom, and who has no faith in the common people nor respect for the integrity of the courts, to open up a tirade against the measure and to asperse the Representative who may propose it and all those who give it support.

I have observed, also, that some of the chiefs of bureaus in the Departments stubbornly resist every attempt to reduce or modify the power they exercise or to reduce in any measure the appropriations for the administration of their bureaus. It is not always a question of patriotism or public good with them, but often a question of personal and official aggrandizement. Some bureau chiefs have gone so far in their opposition to just and prudent measures as to inspire unjust attacks upon Members advocating them and to recklessly, at least, misrepresent their purpose and effect. These officers seem to have no difficulty in securing means of communicating their opposition to the public. There are individuals engaged in newspaper and magazine work who are willing to believe anything that may be told them by a bureau chief in disparagement of the ability and integrity of a representative of the people, and without inquiry or investigation they send out broadcast over the country gross misstatements concerning the provisions and purposes of proposed legislation. Those individuals seem to be imbued with the idea that this is a government of the bureaus, by the bureaus, and for the bureaus, and that any proposition, however wise or salutary, that in any degree minimizes the dignity or power of a bureau chief must of necessity be against the public good. It is human nature for one who is in the enjoyment of autocratic authority to resist every attempt made to limit or modify the exercise of that authority.

The House has a most salutary rule that prohibits legislation upon general appropriation bills. The object of the rule is to prevent "riders"

1 Congr. Record, Feb. 19, 1907.