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For this sum paid on account the sinking fund, act February 25, 1862,

principal.......... .............................................. For this sum paid on account the sinking fund, act February 25, 1862, premium..............


$8, 690,000 00

1,374,680 05

For this sum paid on account of the chargé d'affaires ad interim at
Venezuela, per act of March 3, 1869 ....

2,980 19

* 397, 945, 900 96
And for so doing this shall be your warrant.
Given under my hand and the seal of the Treasury Department this 30th day of
June, in the year of our Lord 1869, and of the Independence the 93d.

Secretary of the Treasury.

AUGUST 7, 1869. Countersigned.

R. W. TAYLER, Comptroller.
JOHN ALLISON, · Register.

JANUARY 31, 1880.

JAMES H. SAVILLE affirmed and examined.

The CHAIRMAN. Mr. Saville was summoned by the request of Mr. Boutwell, through Mr. Dawes. So I turn him over to that gentleman and his associate from Kansas.

By Mr. INGALLS: Question. Mr. Saville, state your residence and occupation.—Answer. I am a resident of Washington, D. C., and I am a lawyer by profession.

Q. How long have you resided here?-A. I have resided in Washington since some time in 1861.

Q. State in what capacity you have been at any time occupied in the Treasury Department ?-A. Some time in 1861 I came into the Treasury Department as an additional clerk in the Secretary's office, and was assigned to duty in the old war-warrant division, as it was called at that time, and during my period of service in the department I remained in that division until it was consolidated, under me as the chief, into the warrant division with duties covering all matters in relation to war. rants and payments.

Q. When did that consolidation occur ?-A. I am not very positive as to the exact date, but some time in 1869, I think. It was shortly after the commencement of the first administration of General Grant.

Q. And under whose administration as Secretary of the Treasury ?A. Under the administration of Secretary Boutwell.

Q. How long did you remain chief of the Warrant Division under the consolidation ?-A. I remained chief of the Warrant Division until sometime in 1870, I think, when I was appointed chief clerk of the department, and remained chief clerk until I was invited to resign by Mr. Bristow.

Q. As chief clerk of the department, what were your duties ?-A. As chief clerk of the department, I was general executive officer of the entire department; I had special supervision of all the business of the Secretary's office and general supervision of the business of the entire department.

Q. Can you state more definitely the time when you resigned ?-A. I think I left the department on the first day of July, 1874, or 1875, I am not positive which.

Q. At the request of Secretary Bristow -A. At the request of Secretary Bristow, between whom and myself, I may say, the personal relations were not very pleasant and had not been for ten years previously.

Q. He had previously occupied some position under the Secretary of the Treasury ?-A. No, sir; he had been Solicitor-General of the Department of Justice.

Q. Are you familiar with what is commonly known as the difference in the statement of the accounts of the Treasury Department that occurred in 1870 !-A. I am.

Q. State who prepared the tables at the time when the difference that has been adverted to first appeared.-A. When I was appointed chief of the consolidated Warrant Division I instituted an examination of the accounts of the government with a view to a publication of a financial history of the government.

Q. At whose suggestion was that examination made ?-A. It was made on my own motion, but after consultation with Secretary Boutwell.

Q. That examination was made for the purpose of preparing a statement of the financial history of the government from its foundation ?A. Yes, sir.

Q. State under that examination, upon consultation with the Secretary, what you did.-A. I, personally, and with the assistance of such competent clerks as I could find, began by an examination of the pub. lic-debt accounts.

Q. Upon what system or idea had the Public-Debt accounts up to that time been stated ?-A. The Public-Debt accounts prior to this time had always been stated from the redemptions and issues of the debt, and I undertook to compare the Redemptions and Issues accounts with the accounts of moneys received into the Treasury from loans and Treasury notes, and moneys paid out of the Treasury on account of the redemptions of loans and Treasury notes.

Q. How long were you engaged in that examination ?-A. I think about two years before I arrived at any conclusion sufficiently definite to justify me in making public any statement in the premises.

Q. When you had completed your examination what was done in connection with the accounts by way of public statement !-A. When I had completed the examination, the first result of it was the publication of a revised statement of the public debt, known as the new series, and I think beginning on the 1st of January, 1871. The first debt statement under the revised accounts was made on the 1st of January, 1871. "Q. What was disclosed by that statement in regard to any apparent discrepancy existing between that revised statement and the statement based on the issues and redemptions ?-A. As to that there was no discrepancy in the public-debt statement, except to show that some of the items which had been carried in the debt statement under the head of " debt on which interest had ceased ” were reduced in amount, and some were increased in amount, for the reason that in the Issues and Redemptions' account they had occasionally omitted or failed to charge up against an account some small certificates of stock that had been redeemed, and had charged up to some other class of stock a certificate that had not been redeemed; or, in other words, there had been clerical errors resulting in transposing accounts. Those were very few. As the final result of the examination, I prepared a table to accompany

the Finance Report of 1871, I think, in which I made a comparison of the accounts of Issues and Redemption and the accounts of Receipts and Expenditures. That disclosed a difference in the amount of the debt of something like $116,000,000. It is a long time since I examined the table, and I would not like to state positively the amount without reference to that table, but it was something like $116,000,000.

By the CHAIRMAN: Q. Do you want the report of 1871 ?-A. Yes, sir. (The Finance Report of 1871 was handed to the witness.)

By Mr. INGALLS: . Q. State to the committee what system you adopted in the report of 1871 in the tabulated exhibit of the public debt differing from that theretofore in use by the Secretary of the Treasury.-A. I stated the public debt in the Finance Report of 1871 from the Receipts and Expenditures account or from the cash account of the government. Prior to that time the public debt statement had always been based upon the Issues and Redemptions without regard to the Receipts and Expenditures on that account.

Q. This statement was prepared after full consultation with Secretary Boutwell ?-A. The statement was prepared after full consultation with the Secretary, and after explaining to him in detail all the differences I had discovered and the reasons for them as far as my investigation at that time had progressed.

Q. Did you make subsequent investigation ?-A. I continued the investigation as long as I remained in the department and in the country.

Q. Up to what period did your examination extend !-A. I believe I went to Europe in 1873, and up to that time I continued personally the investigations into the various items of debt.

Q. Did your subsequent inquiries disclose any different condition of account than that which was exhibited in the debt statement of 1871?A. It did not disclose any differences; it simply disclosed the details more completely and minutely.

Q. Now, state the reasons that induced the changed statement of the Public Debt in 1871 ?-A. The primary reason was that we desired to be accurate. We wanted to be able to put before the world a statement that we could swear to, if necessary.

Q. In what particulars was the statement made previous to 1871 inaccurate?-A. The statements made previous to 1871 were based, as I have stated heretofore, upon the account of Issues and Redemptions of notes and bonds. In the course of the government transactions, I discovered that owing to the views of some of the officers as to what the law compelled them to do, they had never kept an account of discount and exchange, for instance; they never had kept an account on the debit or charge side of their ledgers showing an expenditure corresponding to the issues of certain loans, as, for example, I have forgotten now the exact date, but early in the history of the country-an act was passed by Congress providing for the funding of the Revolutionary debt, which was estimated to be about $76,000,000, and bonds were issued to the amount of about $76,000,000 on account of the Revolutionary debt.

Q. For which no money was ever received into the Treasury ?-A. For which no money was ever received into the Treasury; that is to say, the bonds were issued directly to the people who were creditors of the government.

Q. And under the system adopted previously to the statement of

1871 that would appear as a portion of the public debt of the United States ?-A. That would appear as a portion of the public debt of the United States, and very properly so, because it was a portion of the debt. But, on the other side, by and by when the government came to redeem that debt they paid money out of the general Treasury very properly to redeem the bonds, but in the amount of receipts no money was shown to have been received on account of that debt. It was precisely the same as a business man showing bills receivable for nothing, and by and by getting rich and paying off his bills receivable. When you come to compare his cash account with his other accounts, you would find that his bills receivable which he had redeemed and paid off were in excess of the cash he had received on account of bills receivable the full amounts of those bills receivable which he had not received cash for.

Q. Take the illustration to which you have called our attention and state under the new system of statement adopted in 1871. how that item of public debt would appear.-A. It would appear, as stated from the cash accounts of the government, which are the most important ac. acounts for the presumption is that the government deals in cash wholly-it would appear that the cash was short the full amount of those loans; precisely that much, and the same would be true as to all discount suffered in the placing of a loan, because if the loan was redeemed at par when redeemed or at a premium (an account for which latter, however, was usually provided by the law authorizing the redemption), there would be cash paid out where none appeared to have been received. If the redemption occurred at a premium, it was provided for ; but if the issue had been made at a discount on the face of the loan, as, for instance, say ninety per cent., where the loan was issued for $10,000,000, the receipts into the Treasury on account of that loan would be $9,000,000, and when you come to pay it off you would pay $10,000,000; showing, on comparing the two sides of your cash account relating to loans, an apparent deficit of $1,000,000.

Q. What was the apparent difference that was disclosed by the new statement made by you in 1871 ?-A. $116,104,831.45.

Q. State to the committee, as nearly as you are able, of what items that apparent difference is made up ?-A. I can only say of my own knowledge that the difference, as far as my investigation went and was published, and that I have a copy of it before me, was made up of

Revolutionary debt..
Mississippi purchase stock.....
Louisiana purchase stock.....
Washington and Georgetown debt to Holland
United States Bank subscription stock.
Six per cent Navy stock.......
Texas purchase stock......
Mexican indemnity, fourth and fifth installments, stock........

... $76, 000, 000 00

4,282, 151 12 11, 250,000 00 1,500,000 00 7,000, 000 00

711, 700 00 5,000,000 00

303, 573 92


and then an elastic item of $10,057,406.41 which was the resulting error from comparison, concerning which, in a note printed in the Finance Report of 1871, I state 6 a further investigation of the details will enable a more accurate itemized statement to be made."

Q. In your judgment, what did that elastic item represent ?-A. It probably represented discount suffered in the placing of loans, errors in calculation made by clerks in settling loans, and transpositions of figures and errors in copying, and a thousand and one little items which would work backwards and forwards in the accounts until finally the difference would have been explained, if I had continued myexamination, to a penny; that is to say, I should have explained in detail why the difference between the money received into the Treasury from loans and the money paid out of the Treasury on the redemption of loans, did not agree with the par of the outstanding debt by $116,104,831.45 paid out on that account more than was received on the same account.

Q. Then I understand you to say that that apparent difference of $116,000,000, in round numbers, resulted from the adoption of a different method of stating the condition of the public debt from the books of the Treasury Department ?-A. That apparent difference of $116,000,000 was simply the result of a comparison of two modes of stating the debt from two different sources, on two different plans.

Q. But both methods being derived from an actual inspection of the existing accounts of the Treasury Department without change in any particular ?-A. Yes, sir; without the slightest change in any particular, for there was no authority of law to make any changes. Subsequently, I submitted to members of the House and Senate, and among them to Mr. Beck, who is on this committee, a form of act in which I suggested that Congress give authority to the Secretary of the Treasury to make such entries in detail upon his books as would enable the two accounts to be assimilated, or made exactly alike; and, if Mr. Beck will recall, I had his hearty co-operation and approval in that and several other very important measures in reference to the accounts of the department. I always had a very patient listener and a very earnest and intelligent friend to assist me, when I wanted any assistance of that kind, in Mr. Beck. He promptly comprehended every point I made, and if it was wrong, showed it very quickly, and if it was right, approved it. Mr. Dawes was also on the same committee, and I can speak of him in the same way.

By Mr. DAWES : Q. Did the bill which you prepared, and to which you have made allusion, become a law ?-A. It did not. It passed the House by an absolutely unanimous vote.

Q. Reported from the Committee on Appropriations 1-A. Reported from the Committee on Appropriations when you were chairman and Mr. Beck was a member.

Q. You have spoken very justly of Mr. Beck's co-operation in all your efforts to improve the method of keeping accounts. Will you, in order to make it clear to everybody, tell us from what sources you obtained those items which made up the discrepancy between one mode of stating the public debt and the other ?-A. I obtained every particle of the information I put in my reports from the original record-books of the department relating to the accounts of “Issues ande Rdemptions" and of

Receipts and Expenditures"; from the published volumes known as Receipts and Expenditures; from the finance reports of the various Secretaries, from the first of Mr. Hamilton to the time I made the statement, and from all the sources of information I could get in this country and Europe. I even went so far as, at my own expense, to go to the house of Hope & Co., in Amsterdam, and get permission to examine the old records of the firm of Wilink & Co., who dealt with our government in 1776, and through whom we obtained loans from Holland, for the purpose of examining their records, and I did. I spent two or three weeks in a musty old garret in Amsterdam looking over books that were written in a language that was as difficult for me to understand as Coptic would be.

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