The President's News Conference

THE PRESIDENT. I haven't anything this morning for announcement or quotation.

THE POSTAL DEFICIT

There is a background question here that arises out of the discussions yesterday on the postal deficit that I might amplify a little for you, as I have the figures here about the volume of that deficit.

The deficiency in the 1924 fiscal year was 13 million in round numbers. In 1925 it was 23 million. In 1926 it was 39 million. In 1927 it was 27 million. In 1928 it was 32 million.

And for the fiscal year just closed it was 95 million, which did not include the payments necessary under the direction of the Court of Claims for transportation of mails, which added 42 million, or made a total deficit for' last year of 137 million.

The deficit, after making allowance for increased earnings over the next 5 years on the present basis of directed expenditures and revenues would amount to about 85 million a year. That does not include the building program, which in itself should probably be considered a part of the Post Office deficit, because the construction of post offices over the country is a matter of machinery that does not any more than keep pace with the necessities of the organization. If we added that, it being 35 million, it would mean an estimated deficit on the present basis over the next 5 years of about 120 million a year.

This arises largely out of legislation. In the last session of Congress legislation increasing payments to employees and allowances to postmasters, together with legislation decreasing rates, both combined to increase the deficit by probably 30 million a year. There is other legislation in the hands of Congress, all of which would increase the deficit. There is no legislation before the committees that I know of that would diminish the deficit.

My own impression is that the Post Office is a business institution--a service given by the Government to the public, and that the cost of that service should be borne by the persons who receive the benefits of the service, and not by the taxpayers. What we are going to do first is to have an exhaustive investigation into the parts of the service that are creating this deficit. For that reason we have Mr. [Frederic A.] Tilton as one of the Assistant Postmasters General with the hope of an accurate and complete investigation that will show where the postal service makes its deficit, department by department, or rather division by division

Q. Mr. President, is there any right or authority to increase rates ?

THE PRESIDENT. I think probably there is some flexibility in the air-mail, not in the others. The airmail is still in the experimental stage.

Q. The rate is rather low now, isn't it ?

THE PRESIDENT. I don't know whether it is or not, without some further investigation. There is difficulty there of stimulating a new type of traffic, and a loss at the present time might be a benefit later. We are unable to come to any conclusion about it because the investigation there is incomplete.

That is all I have on my mind.