actual
cost to the Post Office of the handling and transmission of the
second-class mail. An estimate made in 1894 indicated the cost of
transportation for all mail matter as 8 cents a pound, and on that basis
second-class matter at that time involved a loss of nearly 17 million
dollars for transportation alone. In 1897 the total loss on account of
the second-class mail was estimated at 26 million dollars. A further
estimate made in 1901 indicated that the cost of transportation of
second-class matter was at least 5 cents a pound, and that the cost of
handling was a further 2 cents, giving a total cost of 7 cents a pound
on matter for which postage at the rate of only 1 cent a pound was
paid.[340]

In 1905 Postmaster-General Cortelyou submitted an estimate which put the
loss on second-class matter at some $27,000,000 a year; and he
recommended that the whole question should be considered by Congress,
and a law enacted which should simplify the tests by which mail matter
was classified.

These vigorous and oft-repeated recommendations of successive
Postmasters-General, though not resulting in legislation, at length
achieved a result in the appointment in 1906 of a joint Commission of
Congress on second-class mail matter. The Commission held meetings in
New York, and took evidence from the Post Office department and from
representatives of each national organization of publishers in the
United States. Their report, presented in January 1907, was in no sense
conclusive. Their chief difficulties had arisen from the impossibility
of obtaining from the department any statistics as to the cost of mail
matter class by class--a difficulty which is inherent in Post Offices
conducted on the modern system of accounting for postage of all classes
by postage labels of the same type, and handling all classes of matter
promiscuously; and their chief recommendations were that the department
should take fresh statistics with regard to all mail matter,[341] and
make an analysis of operating expenses with a view to apportionment
between the various classes of mail matter. The Commission was so
dissatisfied with the department's position with regard to the
ascertainment of a proper division of the total expenses, that they
recommended the appointment of a further Commission to examine
thoroughly "the whole business system" of the Post Office, and
particularly to determine, if possible, firstly, the actual cost of all
the postal services