The foregoing statements of surplus do not take into account the sum necessary to be expended to meet the requirements of the sinking-fund act, amounting to more than $47,000,000 annually. The cost of collecting the customs revenues for the last fiscal year was 2.44 per cent; for the year 1885 it was 3.77 per cent. The excess of internal-revenue taxes collected during the last fiscal year over those collected for the year ended June 30, 1887, was $5,489,174.26, and the cost of collecting this revenue decreased from 3.4 per cent in 1887 to less than 3.2 per cent for the last year. The tax collected on oleomargarine was $723,948.04 for the year ending June 30, 1887, and $864,139.88 for the following year. The requirements of the sinking-fund act have been met for the year ended June 30, 1888, and for the current year also, by the purchase of bonds. After complying with this law as positively required, and bonds sufficient for that purpose had been bought at a premium, it was not deemed prudent to further expend the surplus in such purchases until the authority to do so should be more explicit. A resolution, however, having been passed by both Houses of Congress removing all doubt as to Executive authority, daily purchases of bonds were commenced on the 23d day of April, 1888, and have continued until the present time. By this plan bonds of the Government not yet due have been purchased up to and including the 30th day of November, 1888, amounting to $94,700,400, the premium paid thereon amounting to $17,508,613.08. The premium added to the principal of these bonds represents an investment yielding about 2 per cent interest for the time they still had to run, and the saving to the Government represented by the difference between the amount of interest at 2 per cent upon the sum paid for principal and premium and what it would have paid for interest at the rate specified in the bonds if they had run to their maturity is about $27,165,000. At first sight this would seem to be a profitable and sensible transaction on the part of the Government, but, as suggested by the Secretary of the Treasury, the surplus thus expended for the purchase of bonds was money drawn from the people in excess of any actual need of the Government and was so expended rather than allow it to remain idle in the Treasury. If this surplus, under the operation of just and equitable laws, had been left in the hands of the people, it would have been worth in their business at least 6 per cent per annum. Deducting from the amount of interest upon the principal and premium of these bonds for the time they had to run at the rate of 6 per cent the saving of 2 per cent made for the people by the purchase of such bonds, the loss will appear to be $55,760,000.