Imagens da página
PDF
ePub

Q. Did you do that for the purpose of learning what was the actual cost of placing the loans at that time?—A. I did that for the purposes of ascertaining whether our accounts and theirs agreed, and what was done with the money, and as to whether the money ever came to this country at all, or whether instead of money we got arms and clothing and supplies. I went to Paris and examined the records of the family of Beaumarchais, who was the father of the farmers-general at the time we were struggling for our liberty, and had facilities offered me by his descendants of examining his original diaries and records.

Q. For the purpose of ascertaining the history of all these loans?-A. For the purpose of ascertaining the history of the various loans made to this government, and writing a book on the subject.

Q. Do the data from which you made this comparative statement now exist in the Treasury Department?-A. I do not think they do, except in a fragmentary shape and as continued by a gentleman by the name of Bayley, whom I had appointed for the special purpose of assisting me. Q. I do not mean your minutes, but the data from which they were compiled.-A. The data all exist in the department.

Q. Could any man with your skill and patience and labor retrace your steps?-A. Without any difficulty, from the records as they exist.

Q. In the Treasury Department?-A. Yes, sir; without any difficulty. Q. They exist without any change of figures?-A. Without a change or alteration or a scratch of any kind. You will probably find on some of the accounts which I examined, in my own handwriting, lead-pencil notes calling attention to errors in the statements of the clerks who made them.

Q. But has a figure been altered, so far as you know?-A. No figure has been altered in the records of the department or papers of the department.

Q. If the government should choose to continue the old mode of stating the public debt, the means of continuing it exist in the Treasury Department?-A. It is continued in the Treasury Department to this day-in the Loan Division of the Treasury Department.

Q. The same old mode?-A. The same old method; and if they do as I instructed the clerks to do when I had charge of the department, every month a debt statement made from the Receipts and Expenditures in the Warrant Division is compared with a duplicate debt statement made from Issues and Redemptions in the Loan Division.

Q. So that if the government should determine to go back to the old method of stating the public debt, they have but to refer to the books in existence in the department?-A. That is all; simply refer to their own records unchanged and unaltered in a single line or figure.

Q. When it is said there has been a change in the statement of the public debt, what is meant by that?-A. What should be meant by that is simply that the debt statement is now an accurate transcript of the cash and bills payable account of the government; and before that it was simply a statement of the bills payable account without any reference to the cash account except as the Treasurer may from time to time have counted and estimated his cash.

If you will permit me, I should like to call attention to a statement which I find here on page 120 of the testimony before your committee in the examination of Rafael A. Bayley, which has been shown me by Mr. Ingalls. It is in answer to a question of Mr. Dawes: "State now of what items that $116,000,000 is made up." Following that is a tabulated statement by which it is shown that the details of the ten million which I spoke of as a flexible item to be further explained, is reduced

from ten million dollars to $942,000, and the revolutionary debt which I stated in my account at $76,000,000, has been analyzed, and is given in detail as "domestic debt of the revolution, estimated at $63,918,475.44," and the remainder is shown to be made up of the loans and supplies obtained from France, the Dutch loan, the debt to foreign officers, &c. This was the result of some examinations made by Mr. Bayley under my direction before I went to Europe, and subsequently continued by him. The statement on page 120 in Mr. Bayley's testimony is the same statement which I made in 1871, only fuller and more complete as to its details.

By Mr. INGALLS:

A

Q. If there are any other matters bearing upon the subject concerning which we have interrogated you, that would throw any additional light upon the subject, I should be very glad if you would state them to the committee.-A. I do not know that there are any other points. If what I have stated to you, gentlemen, concerning my connection with the matter, and what I did is clear, I have told you all there is to tell about it. It may be that I have not made it very clear, because it is a very difficult matter to state technical things of this kind in such a way that "he who runs may read." An intelligent bookkeeper, or a man who knows about accounts, would at once see the object and meaning of what I have said and of the statements I have made; but to the layman it is a very difficult matter to exactly understand what bookkeepers or accountants mean when they speak of the debit and credit of the account, and when they say "bills receivable" or "bills payable." man knows what his cash is; he receives his money and pays it out, and he cannot pay out any more than he receives. In government transactions it is very different. The government can pay out a great deal more than it receives from a certain specific source by receiving it from some other source. We paid out on account of loans $116,000,000 more than we received. That $116,000,000 was derived from revenue, and was in excess of the expenditures on account of the current expenses of the government. The plan of operations that I undertook to carry out was this: I wanted Congress to pass an act enabling the accounts of this department to be kept just as a business man would keep his accounts so as to show his profit and loss on his various transactions and his actual financial condition as derived from the money he received and the money he spent. This $116,000,000 was not paid out without value. We received Louisiana and Texas, &c., and we had supplies during the revolutionary war and the services of soldiers, and we assumed the debt of Washington and Georgetown, and we had ships built for the Navy during the war of 1812, and we subscribed to the Bank of the United States stock, and we did various things by which we got property that we did not pay money for but gave our note for, and when the note matured we paid it in money. Now, if there had been a property account kept, and the property had been charged with its cost and paid for in bonds, and when the bonds were redeemed property had been charged with the money paid out, it would have made the cash account and the Issues and Redemption account of loans agree, necessarily, with the exception of the discount that had been suffered by placing loans and such minor errors as might have been made by clerks in stating accounts. That could have been provided for by a discount and exchange account, treating it in the same manner, and the errors that clerks had made could have easily been corrected by a law authorizing corrections when there were ascertained to have been real errors.

I may say that I found one difficulty in the commencement of my investigation. I had the utmost difficulty to convince people that, because a thing was printed in a book it was necessarily true. Transpositions of figures in the Finance Reports, transpositions in the Receipts and Expenditures statements, a naught where there should have been a six printed, a printer's blunder, was perpetuated from year to year right straight through the accounts, beginning with the entries in the first Finance Report or the Receipts and Expenditures account, and going on down because the clerks were in the habit of taking the printed statement that was made the previous year and adding on to it the statement that was made for the current year, and these errors were perpetuated and more errors made-purely a matter of proof-reading. All these things I had the greatest difficulty in finding. These were things that it required great labor to hunt up.

Q. You discovered then in the course of your investigation typographical errors in the printed statements of accounts?-A. Quite a number, of which I made notes, but I cannot find the note-book now.

By Mr. BECK:

Q. Would there be any value at this late day in passing a bill substantially like the one that you prepared with so much care in 1870 and 1871 ?—A. I think there would; it would require, however, to be somewhat modified in the light of recent legislation.

Q. I am speaking of a bill embodying the same general principle?— A: I think it would be immensely valuable.

Q. How far did the Kellogg bill, which was passed a few years ago remodeling and legalizing different bureaus in the Secretary's office, affect this matter?

A. That did not affect the principle in the least. It did not touch the mode of keeping accounts.

Q. I did not know but that in the distribution of the different bureaus it might have provided for some of the things you had thought of?—A. No, sir. I would like to say to the committee that one of the difficulties I found in connection with this business was the heterogeneous form of our organization in the Treasury Department. That organization began with an almost perfect system, for which Mr. Alexander Hamilton has the credit; and if the additions to the department had been made upon the same plan, a great many of these difficulties in accounts would have been avoided; but the nation was constantly growing, and additional bureaus had to be added to the Treasury Department, and each additional bureau was added and organized without reference to the existing plan of organization. The result is that the system of stating accounts in the old organization, which was composed of the Secretary's office, the Register's office, the First Auditor's office, and the First Comptroller's office, differs from the system that was subsequently created when the Second Comptroller's office and the Second and Third Auditor's offices were created, and differs still more from the organization when the Fourth Auditor was added, and differs still more when the Fifth and Sixth Auditor's offices and the Commissioner of Customs were added.

Q. Did they not for a long time have to run bureaus under the Secretary without having any legal organization attached to them, as a matter of necessity?-A. Yes, sir; they did for a long time as a matter of necessity in the transaction of business.

By Mr. DAWES:

Q. And afterwards they were legalized?A. Afterwards they were legalized.

By Mr. BECK:

Q. The Kellogg bill put them in shape?-A. The Kellogg bill put them in shape.

By the CHAIRMAN:

Q. You spoke of a re examination of the books along about 1870. Was that done by yourself personally?-A. Nearly all of it. I think perhaps for the first year every bit of it was done personally by myself. Subsequently I employed others to assist me, finding it so much work, and being otherwise engaged.

Q. From what dates to what dates did your examination extend?—A. My examination began with the organization of the government in 1789, and extended throughout the entire loan accounts of the government, skipping items that required very great labor to get at their details. They covered the entire field. The details, however, of some of the items I skipped in my examination. For instance, I would begin my examinations at the organization of the government and take all the laws affecting loans; then take all the accounts of the Receipts and Expenditures and of Issues and Redemptions, and I would make a careful analysis and comparison of those, item by item, until I would strike an item like the Revolutionary debt, $76,000,000. At once I knew that that item would require a month of the hardest kind of digging to get at the details of it, and I would omit that item, simply putting it in my memorandum as an item of $76,000,000 to be further examined, and then go on. I finished the examination of the entire loan accounts and the comparison of them before I made my statement of 1871, but I did not examine all the details till afterwards, and some of the details I never examined, but left to my successors to do.

By Mr. DAWES:

Q. Unfinshed work when you left the office?-A. Yes, sir.

By the CHAIRMAN:

Q. You speak of loans. Do you mean the public debt?-A. The public debt; yes, sir.

Q. What did you do with the general Receipts and Expenditures; did you examine them?-A. I examined the general accounts of Receipts and Expenditures in relation to loans only, not in relation to revenues or expenditures for current expenses. That I left for my successors to do.

Q. Did you make any examination of the Receipts and Expenditures other than those on account of loans and discounts?-A. Personally I did not. It was done, however, under my direction by Major Fish and Mr. Bayley, two experts detailed by me for that purpose after I found my own time so much occupied with other things.

Q. When did you commence the examination?-A. As I stated before, I cannot be accurate as to the date, but it was at the commencement of the administration of Mr. Boutwell, somewhere in March, 1869, I think.

Q. You commenced the examination in March, 1869 ?—A. Yes, sir. Q. When did you end it?—A. I continued the examination myself, personally, until 1871, when I made the first statement that is in the Finance Report, and then under my supervision it was continued by the two gentlemen I have named until 1873, I think, when I left the country; and I believe one of them has continued it since.

Q. Did you examine the books themselves in which the accounts were kept, or did you examine the reports of Receipts and Expenditures in print?-A. Lexamined the books of original entry, the original accounts stated by the Auditor and Comptroller, and the books in print. I examined all the data I could find, whether in print or the original documents.

Q. Am I to understand, or not, that you examined each book, each entry on account of the public debt from the organization of the government down to 1870?-A. O, no, sir; I did not examine each entry. I examined each book and each account, but not in detail, so as to go to each entry. It would have taken years to have examined each entry. I had expected, I may say, to do that before I got through.

Q. The question is what you did do before these changes, if any, toɔk place?-A. Permit me to say that I did not make any change.

Q. I said "these changes, if any." Did you take the footings, or did you make additions to see whether they were correct or not?—A. I took the footings as they appeared on the books of original entry, and the reports of Issues and Redemptions, and the footings of the ledgers of the public-debt accounts. I did not make additions myself; I did not go over the additions to see that they were correct.

Q. Did you take the footing of each page or the footing of a month or a quarter?-A. The footings of the year from year to year, and frequently on loans that were nearly all redeemed the footings would not vary for four or five years at a time.

Q. Did you go to the books in every case, or did you take a part of the figures from the printed Receipts and Expenditures of the government?-A. In every instance where I discovered an error I went to the books of original entry, assisted by a report made to the Register of the Treasury by a gentleman in that office-I think his name was Hainesfrom which I derived a great deal of information. That report was in manuscript; I think it never was printed.

Q. Can you give the date of that report?-A. That I cannot do. I think it was made some time in 1853 or 1854. It was a report of the result of an examination of all the loan accounts made under the direction of the Register of the Treasury by Mr. Haines, with perhaps some other gentleman assisting him.

Q. From your experience in the department, which has been considerable, how long would it take, commencing now with, say, five clerks, to begin at the organization of the government and come down to 1870, and examine each item or entry with a view of seeing whether it was correct and with a view of comparing the entries in one set of books with the different books kept in the department, and including the warrants that were issued for the receipts or for the expenditures?-A. With the assistance of five competent accountants I could do that work in about two years.

Q. How many clerks had you to assist you?-A. For the first year and a half, up to January, 1871, I did the work myself, mostly at night, working from seven or eight o'clock until ten or eleven or twelve, as I was able.

Q. After you had done your business day's work?-A. Yes, sir. After that I had the assistance of Major Fish, a thoroughly competent acountant, and still later the assistance of Mr. Bayley, also a competent accountant. That is all the assistance, I believe, I ever had, except incidental assistance from the clerks in the Register's office and other offices who were interested in the subject.

Q. What do you mean by "incidental?" Do you mean that you put

« AnteriorContinuar »