Head. Shoudl a navy-yard be established in these waters, perhaps it may be necessary to fortify some other points for its defense. It is important that the proper localities for these purposes be selected and reserved or purchased without delay. The value of these lands and the difficulty of purchasing the sites are rapidly increasing, and in a few years they can be secure only at enormous cost. Moreover, all expenses incurred for military post in the vicinity be made on sites which are to be permanently occupied. those at Steilacom, Fort Bellingham, and probably Port Townsend, should be abandoned aas a useless expense. I, however, shall order no changes there till General Steele arrives and has time to investigate the matter. I think a board of engineers should be ordered without delay to select the necessary sites for permanent fortifications.

INDIAN FORNTIER.

In regard to the protection of the Indian frontier on the east, the policy should be to keep the troops in advance, retain them in rear of the white settlements, and to make the posts as temporary and cheap as possible. These should be maintained as depots of supplies for expeditions against the Indians and the temporary camps which may be established in their country. As these camps will be continually changing, they should be of the most temporary character. Tents and huts constructed by the troops will usually be sufficient.

DEPARTMENT OF THE COLUMBIA.

The most northerly poston this frontier line is Fort Colville; next is Fort Lapwai, near Lewiston. Probably it will be necessary to establish an intermediate temporary post in the vicinity of Coeur d'Alene Lake or Mission, and perhaps another pretty well up the Salmon River and between the Lapwawi Mountains and Fort Boise. The latter post will serve as a center of operations to Fort Hall on the east and to near the southern boundary of Idaho Territory. Camp Lyon serves as a temporary protection to the mining operations on the Owyhee River, but it will probably be necessary to establihe headwaters of that river, say somewhere near the northern boundary of Nevada or near Pete's Butte, so as to connect with Fort Ruby and the settlements on Humboldt River. All Indians west of this line should be removed or placed in reservations, so as to prevent their marauding expeditions upon the white settlements. Much of this can be accomplished in the course of the coming year.

There is a belt of rather poor country extending from Fort Klamath to the Owyhee River, over which the Indians pass on their robbing expeditions into Southern Oregon and Northern California, and to receive and purchase horses stolen by the local tribes. In order to check these depredations Camps Polk, Watson, Currey, Wright, and Alvord were established in Oregon, and Fort Bidwell and Camps McDermit, Summit Lake, Snake Creek, and Dun Glen in California and Nevda. These are of a very temporary character, and when the more advanced line is completed most of them can be dispensed with. Fort Klamath must for the present, on account of the Indians in that vicinity, be retained. The expenses of its contruction were entirely disproportionate to its importance. Forts Yamhhill and Walla Walla can probably be dispensed with very soon, and Fort Dalles immediately,