The report of the Secretary of War shows a very satisfactory reduction in the expenses of the Army for the last fiscal year. For details you are referred to his accompanying report. The expenses of the Navy for the whole of the last year--i.e., from December 1, 1869, the date of the last report--are less than $19,000,000, or about $1,000,000 less than they were the previous year. The expenses since the commencement of this fiscal year--i.e., since July 1--show for the five months a decrease of over $2,400,000 from those of the corresponding months last year. The estimates for the current year were $28,205,671.37. Those for next year are $20,683,317, with $955,100 additional for necessary permanent improvements. These estimates are made closely for the mere maintenance of the naval establishment as now is, without much in the nature of permanent improvement. The appropriations made for the last and current years were evidently intended by Congress, and are sufficient only, to keep the Navy on its present footing by the repairing and refitting of our old ships. This policy must, of course, gradually but surely destroy the Navy, and it is in itself far from economical, as each year that it is pursued the necessity for mere repairs in ships and navy-yards becomes more imperative and more costly, and our current expenses are annually increased for the mere repair of ships, many of which must soon become unsafe and useless. I hope during the present session of Congress to be able to submit to it a plan by which naval vessels can be built and repairs made with great saving upon the present cost. It can hardly be wise statesmanship in a Government which represents a country with over 5,000 miles of coast line on both oceans, exclusive of Alaska, and containing 40,000,000 progressive people, with relations of every nature with almost every foreign country, to rest with such inadequate means of enforcing any foreign policy, either of protection or redress. Separated by the ocean from the nations of the Eastern Continent, our Navy is our only means of direct protection to our citizens abroad or for the enforcement of any foreign policy. The accompanying report of the Postmaster-General shows a most satisfactory working of that Department. With the adoption of the recommendations contained therein, particularly those relating to a reform in the franking privilege and the adoption of the "correspondence cards," a self-sustaining postal system may speedily be looked for, and at no distant day a further reduction of the rate of postage be attained.