Abbildungen der Seite
PDF
EPUB

VIEWS OF THE MINORITY.

The immediate occasion for the appointment of this select committee was a speech delivered in the Senate of the United States by the Senator from West Virginia [Mr. Davis) on the 13th of January, 1876, in which he asserted that the various tabulated statements of receipts and expenditures relating to the public debt, contained in the Finance Report of 1870, differed from like tabulated statements contained in the Finance Reports of previous years, and charged that the report of 1871 changed the figures and increased the public debt over former reports from the same department.

The resolution appointing the committee was adopted on the 19th of November, 1877, and authorized the investigation of the Finance Reports, books, and accounts of the Treasury Department, particularly with reference to the differences, discrepancies, and alterations in the amounts and figures that have been made in them, if any such there may be, especially in the annual statements of the expenditures of the government revenue collected, and the public debt contained in such reports."

The duty devolved upon the committee by this resolution presupposed a technical knowledge on their part, of the system of accounting in the Treasury Department, or required that they should be assisted in their investigation by some person expert in such matters. The amount of labor involved in the investigation, if it were to be made full and complete, was scarcely to be comprehended by those not familiar with the business operations of that department. No member of this committee possessed the technical knowledge of the department accounts which would enable a thorough investigation to be made, and it became necessary, therefore, to employ some person as an accountant to make the examinations.

Mr. William Woodville was engaged by the committee for this purpose, with Edward Byrne, J. J. Sanborn, and J. W.Gentry as assistants, but two of said persons being employed at the same time. In the process of their investigation, the committee examined various offi. cers of the department now in service, and, in addition, Mr. James H. Saville, who, at the time of the alleged changes, was chief of the Warrant Division, and subsequently chief clerk in that department.

They found that some time in 1869 an examination of the tabulated statements which had been up to that time printed in the Finance Report, and had been prepared by the Register, disclosed the fact that they contained errors and discrepancies, whereupon the chief of the Warrant Division, with the approval of the Secretary of the Treasury, caused the Treasury accounts of receipts and expenditures to be analyzed, with a view to the preparation of a more accurate statement of the receipts and expenditures under the several heads than had previously been made.

This examination showed that the printed statements of the public debt of the United States, as the same had appeared in the Finance Reports up to 1870, contained errors and omissions, not in any manner affecting the correctness of the original accounts, or reflecting in any way upon the integrity or accuracy of the previous officers or employés of that department, but occurring mainly because of errors inseparable from a business of such magnitude, or growing out of incomplete analysis; failure to consider items of account as belonging under special heads, although they might bear technical names not fully indicating their proper relations; and in many instances overlooking the fact that defective legislation had varied the system of accounts without providing adequate remedies for the resulting errors.

The result of this examination was first printed in the Finance Report of 1870 as Table H on page xxv. This table, prepared from the records of the office of the Register of the Treasury, was made by clerks in the Secretary's office, while the tabulated statements compiled by the Reg. ister of the Treasury, and printed in the same Finance Report on page 276, continued to reprint the old figures as the same had appeared in all previous Finance Reports, thus showing a discrepancy in two statements that purported to relate to the same subject. These differing statements attracted attention in Europe, where the then Assistant Secretary of the Treasury was engaged, in connection with the syndicate, in placing the new funded debt, and in a letter to the department he called attention to them, and to the fact that the discrepancies were unfavorably commented upon. Thereupon, on the 24th of November, 1871, the chief clerk of the Treasury Department, with the approval of the Secretary, addressed the following letter to the then Register of the Treasury (testimony, p. 5):

TREASURY DEPARTMENT,

November 24, 1871. Sir: I have to request that the statement of the public debt on the 1st day of Janary in each of the years from 1791 to 1842, inclusive, and at various dates in subsequent years, to July 1, 1870, as printed on page 276 of the Finance Report for 1870, may be omitted from your tables in the forthcoming reports, or else that it be corrected to conform to Table H on page xxv of the same report for the same year.

This request is made in consequence of a letter from the Assistant Secretary of the Treasury, now in London, who complains that these different tables are frequently referred to in England, and the discrepancies between them constantly and unfavorably commented upon.

The table found on page xxv isp I believe, as nearly correct as the examination of the accounts up to the present time will enable it to be made, though I am under the impression there will be some changes necessary in order to make it absolutely reliable. Very respectfully,

J. H. SAVILLE,

Chief Clerk. Hon. JOHN ALLISON,

Register of the Treasury. Since that date, the tables of the Secretary and of the Register have agreed. The statement of the public debt as contained in the Finance Reports prior to 1870, and the Register's statement for 1870, were made from the accounts kept in the Register's office known as “Issues and Redemptions." The tabulated statements of the public debt as contained in the Finance Reports of 1871 and subsequent years, were made from the accounts of “ Receipts and Expenditures” as kept in the Reg. ister's and Secretary's offices, supplemented, corrected, and compared with the accounts of “Issues and Redemptions." There were various discrepancies between these two tables or statements, arising mainly from the different data from which they were derived, but also in some instauces because of the correction of errors and omissions which had from time to time occurred in making them up; but none of these discrepancies, except the errors and omissions, indicated that either statement was wrong when viewed from its respective standpoint. In order, however, to disarm unfavorable criticism in consequence of these discrepancies, the Secretary of the Treasury, in his report of 1871, at page 20, printed a note explaining the cause of the difference. This note is as follows: The statement of the receipts and expenditures, on account of the

principal of the public debt, as per Tables M and N, shows the net receipts from the organization of the government to June 30, 1871, to have been ......

.... $7,094,541, 041 38 The expenditures for the same period were ......... ....... 4,857, 434, 540 51

Leaving .................................................. 2,237, 106,500 87

as the amount of the principal of the public debt outstanding and unpaid on June 30, 1871.

The amount of the principal of the public debt, outstanding and unpaid, as shown by the monthly debt statement for July 1, 1871, and Tables I and L, is $2.353,211.332.32, showing a difference of $116,104.831.45 more outstanding by debt statement than by the statement of receipts and expenditures. This difference is thus explained: The following stocks were issued in payment of various old debts and claims, but in the transactions no money ever came into the Treasury. On the maturity of the stock it was paid off, showing an expenditure where there had been no corresponding receipt : Revolutionary debt of the several States, estimated.........

$76, 000, 000 00 Mississippi stock, exact ......

4, 282, 151 12 Louisiana purchase, exact .......

11, 250,000 00 Washington and Georgetown debt to Holland, exact

1,500,000 00 United States bauk stock, exact ..........................

7,000,000 00 Six per cent, navy stock, exact ..................................

711, 700 00 Texas purchase, exact ..........

5, 000, 000 00 Mexican indemnity, fourth and fifth installments, exact..

303, 573 92 In addition to the foregoing, the following amount is to be added,

being composed of discount suffered in placing loans, interest paid and erroneously charged as principal, and various errors in settling and stating loan accounts. All of these latter and the Revolutionary debt are now being investigated, and will be explained in a future report in detail ............................

10, 057, 406 41 116, 104,831 45

...................

It must be borne in mind, in reading this explanation, that the errors allnded to are not such as in any manner affect the cash account of the government, or reflect upon the integrity of former officers of the Treasury. A part of the differences has arisen from a want of knowledge and care on the part of subordinate clerks in stating loan accounts, but much the larger proportion has occurred from a want of unity, system, and proper method in the accounts as heretofore kept in the department. And these latter defects are partly owing to a want of sufficient legislation to enable the accounts to be properly kept. A bill was presented to Congress at its last session which was intended to supply this deficiency. It passed the House, but was not reached in the Senate. Until there is legislation, these errors and defects in the accounts must be perpetuated, and others must be made.

As an illustration of the class of differences which require legislation before they can be corrected, the two following are given: In 1850 there were $5,000,000 in bonds issued to pay Texan indemnity. For these bonds no money was ever received, and therefore there is no entry representing them on the credit side of the account, as in ordinary loan transactions. When the stock matured it was paid out of the Treasury and charged in the loan accounts, thus erroneously reducing this account by just the amount paid. The loan of February, 1861, was sold at a discount of $2,019,776.10. Only the difference between the amount of this loan and of this discount was received into the Treasury. The loan appears in the debt statement at the par of the issue, but in the receipts and expenditures it can only appear (for want of a premium and discount account) at the actual amount of money received for the loan.

This explanation is brief, simple, and conclusive.
On the receipt of the letter of the chief clerk, above referred to, the

then Register of the Treasury objected to obeying it, and taking it to the Secretary stated his objections and the reasons therefor.

William P. Titcomb, on page 20, says:

Q. Do you know of Register Allison going in person to the Secretary to remonstrate against making changes relating to the accounts previous to the time the order was received ?-A. He informed me that he had stated to the Secretary that in his judgnient it was not worth while to correct the statements that had been published during the former administrations, and I understood that that letter of Mr. Saville was received subsequently to his making that statement to the Secretary. I understood him to state that that was a question of expediency in his judgment, that he would not have corrected a statement that had been made by former administrations in regard to the public debt, or receipts and expenditures, and published, even if he knew it to be erroneous. His language was something like this, that he would have taken it up us he came into office and made every statement correct, and let the old statements stand to take care of themselves. William Guilford says, on page 23 :

By the CHAIRMAN: Q. Do you know whether the Register made the change willingly, or whether he thought it ought not to be done?-A. He told me he objected to it on the ground that he did not think it well to disturb any past and back statements, and that he remonstrated with the Secretary about changing it.

Q. What was the reply?-A. I do not know the words of the reply, but the Secretary sustained Mr. Saville in demanding the change. Joseph T. Power says, on page 65:.

By the CHAIRMAN: Q. Do you know whether the Register thonght it or not a proper thing to do to carry out the instructions of the letter?-A. The Register objected very strongly to the change suggested in the letter, and my recollection is that he presented his objections to the Secretary.

Q. In person or in writing -A. In person.

Q. Do you recollect the result of the objections 1-A. I only know what Mr. Allison, the Register, stated as the result at the time.

Q. Now tell us what Mr. Allison stated to you at the time as having taken place between him and the Secretary ?-A. My recollection is that about this time the subject of the change in the manner of stating these accounts was before the department, and whether immediately before or after the receipt of this order Mr. Allison communicated to me the fact that he had had an interview with the Secretary, and had given his views that these changes should not be made.

These changes merely involved corrections of figures in tabulated statements, and did not require any alterations of the books of record in the department. Joseph T. Power, page 96, says:

By Mr. Dawes: Q. We are instructed to put a question to you, which I have not heard yet, and I will put it. Do you know of the alteration of any figure upon any book in the Treasury Department?-A. I do not, except to correct clerical errors.

Q. Do you know of the alteration of any amount as stated in any book in the Treasury Department?-A. I do not.

Q. Do you know of the alteration of any figure in the Finance Report made by this department in any year after it had gone out from the department?-A. No, sir.

Q. Do you know of the alteration of any amounts in any Finance Report issued by the Treasury Department after its final issue?-A. No, sir.

The same witness says, on page 99:

Q. In 1870, was an effort made to go back over all the books to ascertain what was the difference between the actual debt and the actual receipts and expenditures on account of the debt!-A. Yes, sir.

Q. In going over that examination, were any figures altered 1-A. Not one.

Q. The accounts remain to-day as they were before that work was undertaken ? A. Precisely.

By the CHAIRMAN: Q. Was or was not the amount from 1833 down to 1870 changed each year when you

made the revision of the public debt in 1870 ?-A. The amounts were not changed. A different statement was made showing different results.

Q. I understood you, in answer to Mr. Dawes, to say that the books had not been changed and that the figures upon the books were the same now as they were previous to 1870. Did I understand you correctly ?-A. Yes, sir.

Q. Do you know that personally-A. I rather know the negative of it. So far as I know, I have never known of a single change. They could not be changed to effect a purpose.

Q. 'Do you know of any alterations, erasures, or scratches that would change the amount in figures upon any of the books 1-A. As fixed at the time the entry was made, do you mean?

Q. At any time.-A. The results on the books, as balanced each quarter or each year or each month, have remained the same as they are at present.

Q. That is not an answer to the question. The question was, do you know yourself of any erasures or alterations or changes of figures upon the books themselves ?A. I have seen where a wrong entry had been made, and it had been corrected, but that was a contemporaneous change in the entry,

Q. Was that made by a counter entry, or was it made by erasing a figure and placing another one in its place I-A. It was just correcting a blinder of the clerk.

Q. I am asking how it was made.-A. I should have to refer to the particular instance, which may have been one way or another.

Q. Have you not any in your mind ?--A. I have none. I have seen cases where a warrant started from the Secretary's office, and was not granted by the Comptroller, and it had to be returned. In that case the entry was canceled. That is the only kind of erasures that ought to appear upon the books and that I know of on the books. And the same witness says, on page 102:

By Mr. DAWES : Q. Is it true that all the books of the department, including those of the Treasurer himself, are finally balanced once each quarter?-A. They are once, each quarter at least.

Q. And have been since the foundation of the government, as far as you know!A. Yes, as far as I know.

Q. Have you ever known or heard of a single figure of those balances being changed since the balances were made 1-A. I have never known a single figure being changed in any of the balances since they were first determined.

Lewis D. Moore, at page 103 of the testimony, says:

Q. Do you know of any change of figures in your books by anybody ?-A. O, no. I have had charge of them always; I started them.

Q. You have made no change of figures, have you 7-A. None at all.
Q. You know of nobody else having made any 1-A. No, sir.

Q. Of the amounts in your books ?-A. Not a particle. Everything is as it has been put down.

Q. Do you know of any such change in any book in the department ?-A. I do not.

Perhaps the most conclusive testimony upon this point is that of J. T. Power, the present chief clerk, on page 99 of the testimony:

By Mr. DAWES : Q. Could any other experts go over this same ground with the books now that was gone over by the Treasury officials before this change in the mode of statement was made 1-A. They would find the same results on the face of the books.

Q. Every figure is there now that was when the work was undertaken 1-A. Yes, sir.

And the following from the testimony of James H. Saville, chief clerk at the time the corrections were made, and who supervised and directed the examinations which developed these various errors and led to their correction; on page 204 of the testimony he says:

By Mr. Dawes: 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.

« ZurückWeiter »