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Report of the Secretary of the navy.

This is a very voluminous report, giving the whole naval history of the war.

The European squadron is commanded by Rear Admiral L. M. Goldsborough. The field of operation is the coast of Europe and the Mediterranean.

The Brazil squadron is commanded by Acting Rear Admiral S. W. Gordon. This will cruise on the eastern coast of South America and the western coast of Brazil.

The East India squadron is commanded by Acting Rear Admiral H. H. Bell. The Shenandoah will be one of this fleet.

The Pacific squadron, commanded by Acting Rear Admiral George F. Pearson, cruises the whole western coast of North and South America and the islands of the Pacific.

The Secretary dwells with great pride on the rapid increase of power in the navy, and the difficulties overcome in its growth. He speaks with scorn of the "three hundred and twenty-two officers who traitorously proved false to the flag which they had sworn to support and the Government which had confided in their honor." "Better men, from the merchant marine, educated, and vastly more efficient," supplied their places.

He recommends the enlarging of the navy yards, the construction of naval vessels and increased facilities for repairing them. Speaking of the property captured and destroyed, he says that "naval men, while animated by the noblest feelings of patriotism, and ready to sacrifice their lives to their country," believed that the war would offer them "but limited opportunity for the rebels were not a commercial people." Twenty million five hundred and one thousand nine hundred and twenty-seven dollars and sixty-nine cents is the net sum for distribution as prize money.

It concludes by hoping that the brilliant naval record will be accepted as proof that the Department has done its duty, and further hopes that the Government will extend its fostering care to the navy, which has won the gratitude and admiration of the country.

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