The advocate and Topeka tribune. [volume], December 14, 1892, Page 2, Image 2

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IN THE SENATE OF THE UNITED STATES.
April 29, 1880. Ordered to be printed. Dumber 17, 1880. Ordered to be reprinted.
Ms. Davis, of West Virginia, from the Select Committee to Investigate the Finance
Reports, Books and Accounts oi tne rreasury uepariment, suDmiiwa tne ioi
lowing report:
dfo. 6. Continued from last wttk.)
ORGANIZATION 07 THE WARRANT DIVISION AS IT NOW EXISTS.
Maj. J. T. Power, now chief clerk of the treasury department, and formerly
chief of the division of warrants, estimates and appropriations in the treasury de
partment, testified ( see testimony, page 61 ) :
Q. When was the office you now hold created by law? A. Since the organiza
tion of the decartment under Mr. Boutwell the warrant division has existed as at
present; but the act of March 3, 1875, commonly known as the Kellogg bill, that
.. i 1 1 ! a.: it i j:;: ; .,.
uXea oy law vne organization ui mo warraui uivioiuu as iu uu caislo.
Q. In what office, and how, was the branch of service that you now are en
gaged at attended to previous to 1870? A. Previous to 1870 the duties now
assigned to this division were peformed by two divisions, the organization of the de
partment then recognizing more divisions and subdivisions than at present. In
1870 Secretary Boutwell consolidated the different divisions and branches of his
office in an organization about as it now stands. There have been some slight
changes since.
Q. And in 1875 this was recognized by law? A. Yes, sir.
From the above we see the division of warrants was organized in 1870 by the
then secretary of the treasury, but was not known in law until 1875; yet, from this
office, in 1870, the statement was made upon which the register was ordered to make
changes in his statements of receipts, expenditures, and publio debt, as reported to
congress in official finance reports in previous years.
And again (see testimony, page 66) :
By the Chairman :
Q. Take the statement marked "F" in the testimony before this committee
and say whether the changes and difference between the figures are correctly stated
in that statement from the secretary and the register, as they appear in the reports
of 1870 and 1871? A. In this statement I see the first colunn of the finance report
of the secretary for 1870 at page 25 represents the outstanding debt at the end of
each year from 1832-'33 to 1870, inclusive. The second column shows the outstand
ing at the end of each year as taken from the register's statement in the finance re
port of 1870 at page 276. The next two columns represent the secretary's compared
with the register's, the first column showing the increase and the second the de
crease. That increase represents the amount outstanding in one report in excess of
the other report, and appears to be correctly taken from those finance reports.
Q. Was the register's report changed between 1870 and 1871, as repesentedr
npon the right-hand column? A. The register's report for 1871 makes a ifferentd
statement, showing a different amount outstanding for those years.
By Mr. Dawes:
Q. Different from what? A. Different from the statement in the report of the
year before.
By the Chairman :
Q. "Was this different statement the result of the letter received from the secre
tary's office? A. It was.
' Q. Are the amounts set forth in the increase and decrease columns of this table
F the true amounts as to each year? A. They appear to be the true amounts of the
increase of one report over the other.
ThuB Maj. Power certifies to the correctness of "Statement F,w which shows
changes in the debt statements for the years before mentioned, and to the fact that
the changes were made between 1870 and 1871.
MANNER OF KEEPING THE ACCOUNTS.
In another portion of Maj. Power's testimony we find the following (see testi
mony, pages 70, 83 and 84):
By the Chairman :
Q. You have stated that if the accounts were kept with a view to keeping them
by receipts and expenditures, they would be as true as if kept by issues and re
demptions? A. Yes, Bir. L
Q. Were the aooounta kept at that time in that way? A. They were not so
kept prior to 1870.
8. Then thev were kept by issues and redemptions? A. Yes, sir.
. Did not the issues and redetnotions show the true amount of the indebted
ness of the government? A. I believe so, in all cases except where errors crept
into the statement, as they are liable to in any class of aooounta
Q. But as to the system of keeping the books prior to 1870, could not the true
j'xojni nave oeen siatea oj issues tmu rouempbiuua vw mo yuuuv uo ;
timi? A. Yes, sir; just as well.
Q. Cannot a correct debt statement be made from issues and redemptions ex
clusively for the years 1860 and 1870, inclusive? A. A correct statement of all
icauea and redemptioaa can be made, no doubt, between those two periods by accu
rate and careful accountants. ,
Q. Could a correct statement of the publio debt be made up for each year, be
ginning with the organization of the government and coming down to 1870, from
the issues and redemptions alone? A. Yes, sir.
Q. If the debt was kept by receipts and expenditures alone, how could you
manage with such items as the revolutionary debt, Mississippi, Louisiana, Texas,
Massachusetts, Eada' jetties, etc., where no receipts come into the treasury? A.
By making a book-keeper's entry under a title as " publio debt for which no re
ceipts come into the treasury."
This statement of Maj. Power shows that the accounts could be kept just as
"well and accurately by issues and redemptions as by receipts and expenditures. In
fact, they were from the beginning of the government to 1870 kept by issues and
redemptions, and, as all agree, correctly and well kept. t
The committee call attention to this portion of the testimony of Maj. Power
(see testimony, pages 71 and 72):
By the Chairman:
Q. Is it a fact, or not, that previous to 1869 the secretary and register, in re
porting the amount of the debt, substantially agree? A. I believe they do. That
Is, I believe the secretary's detailed report and the register's tabulated statement
substantially agreed in all previous years.
Q. Since 1870, do the secretary and register substantially agree as to the
UftCU&t Of & teiaSdiag' fatlifl diUf-A Ycl, dfj tfith till election Cf A nrj
small amount fcf (250 I tfeUttfe
Q, They fig"fee, then, exactlf except U to &250MA. Tfcfly do.
. Q. Then the changes and alterations that appear in the publio debt wefe" Made
between 1869 and 1871 f A. Yes, sir. You say "changes in the public debt.' They
were changes in the reports, not in the publio debt.
Q. Were or were not the figures as previously stated in the different finance re
ports from 1833 to 1870 stated in a different way in the report of 1870 by the secre
tary? A. They were.
Q. For each of those years? A. The secretaries differ in their reports. The
secretary for the year 1869 states the outstanding public debt of each year at a cer
tain amount, and the secretary at the time of bis report stated the debt outstand
ing at the end of the same years somewhat differently.
This is merely corroborative of the statement already made, that previous to
1870 and since 1871 no substantial differences appear between the secretary and the
register in the statement of the public debt.
PACIFIC RAILROAD DEBT.
Attention is asked to the following extracts from the testimony of Maj. Power
(see testimony, pages 74 and 75):
By the Chairman : "
4
O. You BDoke a short time a?o of the Pacific railroad debt in 1869. Was the
Pacific railroad debt considered a Dart of the Dublio indebtedness in 1869? A. It is
so reported in that report, under the head of " Statement of the indebtedness of the
United States, June 30, 1869. Un page 'z oi the finance report cor loo9 the item
Pacific railroad companies bonds, $o3,(xo,d20 is included.
Q. In 1869, in the detailed statement of the secretary, he includes in the publio
indebtedness of the country the Pacific railroad debt, which amounts to the sum
just named? A. Yes, sir.
U. In the report of 1870 does he also include it? A. it is not included in the
report of 1870.
O. It is dropped? A. It is dropped.
Q. Ought or ought not that to have reduced the publio indebtedness by the
amount of the Pacific railroad debt when it was dropped? A. It would have re
duced the aggregate of the report of the outstanding indebtedness.
The aggregate of the amount given to the public in the report? Yes, sir.
Q. There is an increase of the secretary's statement over the register's of $91-
000,000; add the $58,000,000, and the increase would have been $152,000,000, would
it not? A. Yes, sir; about that.
Q. That being so, if the Paciho railroad debt had not dropped out, but had
been kept in the statement as it appeared in 1869, the increase in the debt of 1870,
as stated by the secretary, would have been about I152,0U0,0UU instead ot $ui,uuu,-
000, would it not? A. I believe that is correct.
In the official finance reports of 1869 and previous years, the bonds issued to the
Pacific railroad companies were treated as part of the publio debt, amounting, in
1869,;to $58,638,320; but in 1870 this item was dropped from the public debt state
ment, and treated as a separate debt; and yet instead of the aggregate of the debt
for the year 1869 being thereby reduced $58,000,000, there was an apparent increase
in the total of $99,000,000; and adding the $58,000,000, the secretary's statement
showed an increase of $157,000,000 in the publio debt over the amount of it as stated
by the register.
COMPARISON OF ACCOUNTS BY THE DIFFERENT BUREAUS,
Reference is made in the following testimony of Maj. Power (see testimony,
pages 76 and 77):
By the Chairman: ,
O. Do vour different bureaus or divisions in the department at stated periods
make comparisons to see whether their accounts agree or not? A. Every month a
comparison is made by the three offices. '
Q. What three? A. The register's, comptroller's, and secretary's. The differ
ent book-keepers in these offices compare one with the other. They do not each
compare with both the other officers; but the comparison is made by the register's
with the comptroller s, and the comptroller s with tne secretary's, in mat way we
have a comparison as well as a balance of each ot the books every month, and these
are compared with the aggregates on the treasury's books, and at the end of every
quarter a complete balance of all the transactions for the quarter is made, which
agrees to a cent in all branches of the department.
Q. That being so, how do you account for your being able in 1870 to go back to
1833 and make these different statements in amounts? A. In reply to that I should
have to explain how the discrepancies arise, bow this occurred.
Here it is shown, by a prominent and experienced official of the treasury one
to whom the committee was specially referred by the secretary for information on
all points connected with the operations of the departmeat that the different
bureaus or divisions of the treasury at the end of each month, quarter, and year,
compare books with each other, and if there are errors they are looked into and
corrected. This, the committee are assured, has been the monthly, quarterly, and
annual practice of the offices of the secretary, comptroller, and register from the
organization of the government; and not only this, but the treasurer's cash has al
ways been counted quarterly and the warrants checked. Notwithstanding all this,
in 1870, by an order of the secretary to the register, that officer, in 1871, made many
changes in the statements of the publio indebtedness from 1833 to 1870, and also
made many changes in his report of the receipts and expenditures.
During the examination of Mr. Power, the following facts were elicited (see
testimony, page 79):
By the Chairman:
Q. I simply ask whether the debt, as it now appears on the 1st of July for the
previous fiscal year, is made up in the secretary's or the register's office? A. In the
secretary's office.
Q. Not in the register's office? A. Not in the register's office.
Q. From the first days ot the government, from the time of Alexander Hamil
ton, were the debt statements made up by issues and redemptions? A. By issues
and redemptions. , . .
Q. From the days of Hamilton, as secretary, down to Mr. Boutwell s adminis
tration, they were made up by issues and redemptions solely? A. Yes, sir.
Q. All the secretaries between Hamilton and Boutwell made them up by issues
and redemptions, and there was no break in the form of making up those public
debt statements, was there? A. I believe not; I believe they were uniformaly made
from issues and redemptions,