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charge that we have been in any way remiss in observing our treaty obligations. I also wish to impress upon Congress that, as stated in my former message on this subject, it is essential in dealing with it not only to fulfill the obligations imposed upon the United States by the letter and the spirit of the convention, but also to consider the interests of the other parties to the convention, for their cooperation is necessary to make it an effective and permanent settlement of the fur-seal controversy.

WM. H. TAFT.

SPECIAL MESSAGE

[Transmitting Reports of the Commission on Economy and Efficiency.] THE WHITE HOUSE, January 8, 1913.

To the Senate and House of Representatives:

I submit for the information of Congress the report of the commission appointed by me to carry on the work authorized under act of appropriation of June 25, 1910, which made available $100,000—

To enable the President, by the employment of accountants and experts * * * effectively inquire into the methods of transacting the public business *** with a view of inaugurating new or changing old methods * *

to more

SO

as to attain greater efficiency and economy therein, and to ascertain and recommend to Congress what changes in law may be necessary to carry into effect such results of his inquiry as can not be carried into effect by Executive

action alone.

Pursuant to this authority a preliminary investigation was instituted under the Secretary to the President with a view to determining what ground should be covered and what staff and organization would be required. This preliminary inquiry was carried on until March, 1911, when, at my request, the term of the appropriation was extended to June 30, 1912, and $75,000 was added.

Of this $175,000 made available for the first two years the amount expended for the preliminary inquiry was $12,252.14, leaving $162,747.86 available for the 15 months remaining after March 8, 1911, when the commission was organized. By special message of January 17, 1912, I requested that $250,000 be made available for the current fiscal year. Only $75,000, however, was appropriated, and to this

was attached a restriction to the effect that not more than three salaries could be paid in excess of $4,000 per annum, thereby forcing a complete reorganization of the commission. At the same time the Con

gress by special resolution requested a report from the commission with recommendations on the organization and work of the Patent Office-this to be submitted to Congress not later than December 10, or a little over three months after the resolution was passed. Although $10,000 additional was appropriated for this purpose, it was impossible within the time to organize a special staff which could do such a highly technical piece of work. A further limitation to constructive work has been found in the short period for which funds. have been made available. Many of the problems of administration which should be gone into require months of constant attention. The commission has not felt free to undertake work which could not be reported on before the expiration of the appropriation, and the appropriation for the current fiscal year was not passed until August 24, the authority expiring June 30 following. I mention these facts. to indicate some of the handicaps under which the commission has. labored in prosecuting one of the most difficult, far-reaching, technical inquiries that has ever been undertaken, and one from which economies have already been realized many times greater than the cost.

In planning the work to be done by the commission the first controlling fact was that there was no basis in information for judgment as to what changes should be made or what would be the effect of any recommended change, no matter how simple it might at first appear. As was stated in my message of January 17, 1912, on the subject:

This vast organization has never been studied in detail as one piece of administrative mechanism. Never have the foundations been laid for a thorough consideration of the relations of all of its parts. No comprehensive effort has been made to list its multifarious activities or to group them in such a way as to present a clear picture of what the Government is doing. Never has a complete description been given of the agencies through which these activities are performed. At no time has the attempt been made to study all of these activities and agencies with a view to the assignment of each activity to the agency best fitted for its performance, to the avoidance of duplication of plant and work, to the integration of all administrative agencies of the Government, so far as may be practicable, into a unified organization for the most effective and economical dispatch of public business.

The only safe course, therefore, was first to obtain accurate knowledge of the vast administrative mechanism of the Government; get a clear notion of what the officers and agents of the Government were doing in all of its departments, bureaus, and subdivisions; find out how each part of the service was organized for performing its activities, what methods are being employed, what results are being obtained, where there are duplications of work and plant, wherein the organization and methods are ill adapted or ill adjusted.

In each case, as first drafts of descriptive reports have been com

pleted by the commission, they first have been submitted to the services whose organization and work are involved, so that this part of the work has been a joint product of all services. This has been done for the double purpose of having a statement of fact that is beyond controversy, and to lay the foundation for the consideration of the critical comments and constructive suggestions that have followed.

To the present time 85 reports have been submitted which carry recommendations. Fifteen of these reports, most of which recommend constructive legislation, have already been sent to Congress, viz.:

I. Outlines of organization of the Government. Submitted January 17, 1912 (published as H. Doc. 458).

2. The centralization of the distribution of Government publications. Submitted February 5, 1912 (published in S. Doc. 293).

3. The use of window envelopes in the Government service. February 5, 1912 (published in S. Doc. 293).

Submitted

4. The use of the photographic process for copying printed and written documents, maps, drawings, etc. Submitted February 5, 1912 (published in S. Doc. 293).

5. Methods of appointment. Submitted April 4, 1912 (published in H. Doc. 670).

6. The consolidation of the Bureau of Lighthouses of the Department of Commerce and Labor and the Life-Saving Service of the Department of the Treasury. Submitted April 4, 1912 (published in H. Doc. 670).

7. The Revenue-Cutter Service of the Department of the Treasury. Submitted April 4, 1912 (published in H. Doc. 670).

8. The accounting offices of the Treasury, with recommendations for the consolidation of the six auditors' offices into one. Submitted April 4, 1912 (published in H. Doc. 670).

9. The Returns Office of the Department of the Interior. Submitted April 4, 1912 (published in H. Doc. 670).

10. Travel expenditures. Submitted April 4, 1912 (published in H. Doc. 670). 11. Memorandum of conclusions concerning the principles which should govern the handling and filing of correspondence. Submitted April 4, 1912 (published in H. Doc. 670).

12. Supplementary report on the centralization of the distribution of Government publications. Submitted April 4, 1912 (published in H. Doc. 670). 13. The use of outlines of organization of the Government. Submitted April 4, 1912 (published in H. Doc. 670).

14. Report on the retirement of superannuated employees. Submitted May 6, 1912 (published as H. Doc. 732).

15. Report on "The Need for a National Budget." Submitted June 27, 1912 (published as H. Doc. 854).

The reports of the commission already submitted which call for Executive action relate to a variety of subjects. Included in these reports are recommendations: For the modification of orders and practices related to the administration of the civil-service law; the installation of a uniform system of accounting and reporting; forms

and instructions for the preparation and submission of a budget; the use of window envelopes; the introduction of labor-saving office devices; more economical Government housing; better lighting, heating, ventilation, and sanitation; the better utilization of waste; the more economical disposition of obsolete and condemned stores and other property; the discontinuance of the jurat in the preparation of claims for reimbursement; the promulgation of rules governing travel expenditures.

With respect to many of these, affirmative action has been taken, but in nearly every case it is necessary to proceed slowly with the making of changes, which have already been ordered, as it necessarily requires months to make any change which broadly affects the service without causing so much confusion as to seriously interfere with the transaction of Government business.

On December 9 I transmitted the report of the commission, with its recommendations, on the organization and work of the Patent Office. This report is printed as House Document No. IIIO. I am transmitting herewith II other reports, the recommendations contained in which have my approval, as follows:

1. Business methods of the office of The Adjutant General of the War Department.

2. The handling and filing of correspondence in the Mail and Record Division of the office of the Chief of Engineers.

3. The handling and filing of correspondence and the doing of statistical work in the Bureau of Insular Affairs.

4. The handling and filing of correspondence in the office of the Surgeon General.

5. The handling and filing of correspondence in the office of the Signal Corps. 6. The handling and filing of correspondence in the office of the Chief of Ordnance.

7. The handling and filing of correspondence in the Mail and Record Division of the Department of Justice.

8. Methods of keeping efficiency records of employees in the National Bank Redemption Agency of the Department of the Treasury.

9. Report on the electric lighting of Federal buildings of the Department of the Treasury.

10. On the establishment of an independent public health service. 11. The recovery of fiber stock of canceled paper money.

The first six of these reports have been the result of intensive study of methods employed in the offices of the War Department at Washington, which point to detail reductions in cost which may affect the appropriations for 1914. These, together with the recommendations of the Secretary of War, are sent for your information. In the opinion of the commission, an estimated saving of over $400,000 a year can ultimately be made by favorable action on the

changes in methods which are recommended in the six offices of the War Department alone.

One report above listed relates to the question of personnel. This is important both in its relation to efficiency of organization and economy of work. A number of other reports, containing recommendations for changes in the details of methods which, in the opinion of the commission, will produce marked savings in annual cost of transacting the business of the offices investigated are in the hands of the services interested. These will be sent for the information of the Congress as soon as action has been taken or other conclusion has been reached.

The report on electric lighting of public buildings is significant of the inattention to administrative details in a subdivision of the service which is charged with the operation and maintenance of several hundred Government buildings. Until this inquiry was begun. no attempt had been made in this office to find out what was even the gross expenditures for operation as distinct from maintenance, or capital outlays, either for each building or for the whole service, and there were no means provided for knowing the heating, lighting, cleaning, or other costs as subdivisions of operation. The head of the office was presumably interested in construction; the primary responsibility of the department was for the care and custody of funds; the result was that no attention was given to the development of the information essential to the central direction and control over operative services. And it may be said that the condition found in this office is typical of the condition found in many of the operative services. The report covers only a partial inquiry into lighting efficiency.

The report submitted relative to the recovery of fiber stock of canceled paper money proposes that the method of macerating this stock which has been in use for about 40 years be discontinued and that more modern methods be adopted. Under modern methods of treating this paper stock it is deinked and defibered with but a small loss of pulp, and such stock when recovered can be used in the manufacture of new money paper, at a saving, as compared with the present method of macerating and sale, of about $100,000 per annum.

While during the time and with the staff available it has not been possible to make final detailed reports on more than a few of the hundreds of offices at Washington, and in only one office outside of Washington has work of this character been undertaken, the reports which are submitted will serve to illustrate the character of results which may follow an extensive investigation of office technique and procedure. It is further to be noted that the offices which have been reported on are those which have been frequently under scrutiny. From