In the last annual report of the department special attention was directed to the _enormous loss the government sustains_ in the handling and transportation of second-class mail. Owing to the rapid increase in the volume of such mail _the loss is constantly growing_. A remedy should be promptly applied _by charging more postage_. In providing for the higher rates it is believed that _a distinction should be made_ between advertising matter and what is termed _legitimate reading matter_. Under present conditions an increase in the postage on reading matter is not recommended. Such an increase would place a special burden on a large number of second-class publications, including _educational and religious periodicals_, that derive little or no profit from advertising. It is the circulation of this type of publications, which _aid so effectively in the educational and moral advancement of the people, that the government can best afford to encourage_. For these publications, and also for any other _legitimate reading matter in periodical form_, the department favors a continuation of the present low postage rate of 1 cent a pound, and recommends that the proposed increase in rate be applied only _to magazine advertising matter_. This plan would be in full accord with the statute governing second-class mail, _a law that never justified the inclusion under the second-class rates of the vast amounts of advertising now transported by the government at a tremendous loss_. _Newspapers are not included in the plan_ for a higher rate on advertising matter because, _being chiefly of local distribution_, they do not burden the mails to any such extent as the widely circulating magazines. Under the system proposed it will be possible, without increasing the expenditure of public funds, to utilize _for the benefit of the entire people_ that considerable portion of the postal revenues now expended to _meet the cost of a special privilege_ enjoyed by certain publishers.