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do I say they may not, if they choose, open the finding of this tribunal which has been constituted under a resolution of the Senate; but I submit that you have before you a proper authority for your conclusion, and I ask you, why go behind their report, especially when that report is commended by the Navy Department itself, and by the Naval Committee of the Senate?

The case seems to me to be unanswerable; it is impregnable. I put it, first, on the ground of original equity, growing out of the abnormal condition of war; in the second plece, I put it upon the ground that it has been heard and considered by a tribunal practically of your own selection; and I may add, in the third place, that all this has been admitted and recognized by a committee of your body. I hope you will not hesitate to do justice.

Mr. HENDERSON. I suppose the Senator from Massachusetts is perfectly familiar with this report, and as I know but little about it I rise merely for the purpose of getting some information in order to guard myself in my vote. I desire to ask him if the board constituted under the resolution of the Senate heard any evidence whatever beyond that which was presented by the contractors themselves. I call his attention to the minutes of the board:

"The board, after a critical examination of the bills of cost presented by the several contractors for vessels and steam machinery contracted for in the years 1862 and 1863, who have appeared and made sworn statements, has determined the excess of cost in the several cases, over and above the contract price and allowance for extra work, to be as follows."

The minutes of their proceeding do not show that they heard any testimony whatever except that which was brought by the contractors themselves, the bills of cost which they presented and which they swore were the bills that entered into the construction of these vessels. I ask the Senator if he has any information on that subject, whether they were authorized, or whether they did take other testimony than that which was presented to them? I suppose they were authorized to do so.

Mr. SUMNER. I will say to my friend that I have no information beyond what appears in the report.

Mr. HENDRICKS. If the Senator from Massachusetts will allow me, there was other evidence taken by the board. What was the entire evidence before the board is not communicated in the record of the board, but in reading the record of the board I find that there was additional evidence to that of the contractors themselves taken.

Mr. HENDERSON. Upon what points? Mr. HENDRICKS. Upon the character and cost of the work. Mr. HENDERSON. witnesses suggested?

By whom were the

Mr. HENDRICKS. The board took the testimony of naval constructors. I believe they are officers in the Navy.

Mr. CLARK. I will inquire if there was anybody else examined besides these constructors and officers connected with the Navy?

Mr. HENDRICKS. I do not understand these constructors to be contractors. They are officers of the Navy.

Mr. CLARK. Certainly, I understand that; but I do not find in looking over the report that anybody beyond those were summoned as witnesses.

Mr. HENDRICKS. I am not prepared just now to say that there was anybody beside these naval constructors.

Mr. CLARK. I do not see any in the report.

Mr. HENDERSON. Although my friend from Massachusetts has made a very earnest speech in favor of allowing these claims, and from which I was very much struck with the merit (as I supposed) of the claims, yet he seems not to be perfectly conversant with the whole case. I think he is rather generous on this occasion, and jumps at the conclusion that these contractors are entitled to something too readily. It springs, however, from his magnanimous and generous nature, I think.

I

desire, therefore, to ask the Senator from In-
diana, who seems to have given attention to
this subject, whether these contractors con-
tracted for other vessels than those named in
this report of the committee during the exist-
ence of the war between 1861, the time of its
commencement, and 1865, the time of its close.

Mr. HENDRICKS. I believe that the board
has given us no evidence upon that question;
but I understand that some of these contractors
did construct other vessels, and some did not.
For instance, I understand that the Messrs.
Secor constructed either four or five vessels, I
do not know which, and their claim here is for
three. I did hear, though from no authentic
source, that Messrs. Eads & Co., of St. Louis,
did some other work for the Government beyond
that mentioned in this bill, but what that work
was I do not know.

Mr. HENDERSON. My reason for asking the question springs from the fact that I noticed in the report that Mr. James B. Eads, of St. Louis, who deserves a great deal of credit for his industry and energy in the construction of vessels in the early part of the war, is allowed by this board for constructing the Milwaukee, which was constructed at St. Louis, $30,438 84, and they allow him on the Winnebago $29,174 20, making an aggregate of $59,613 04, which they suppose is the loss he has sustained in the construction of these two vessels. According to my understanding Mr. Eads constructed some five or six vessels for the Government. Am I to understand that if Mr. Eads made money upon the other contracts he is entitled to be paid for his losses upon these two vessels? I understood from Mr. Eads, who is a very highly honorable gentleman indeed, that upon one or two vessels he had lost some money, but I surely did not understand from him that he lost money upon all the vessels that he constructed. My understanding was quite to the contrary; and if we are to allow large sums of money for losses sustained in the construction of some vessels I cannot see why there should not be a set-off at least of the amount of profits made upon other vessels constructed by the same parties. My friend from Indiana tells me that the Messrs. Secor, who are allowed for large losses by this report, constructed other vessels. Am I, by my vote, to allow them a large amount of money to reimburse them for losses upon the vessels named here without knowing what amount of profit they made upon other vessels? I do not know but that the contracts were all taken together; probably they were all taken together; and it is surely a very dangerous precedent, as stated by the Senator from Kentucky, to make these allowances when the parties have really made large sums out of the Government upon other

contracts.

The Senator from Massachusetts says that this is a court that we have established to investigate this matter; and he asks, do we not take the reports of the Court of Claims? Certainly we do, but the Court of Claims was established by act of Congress. Was this board established by a joint resolution of Congress? I do not so understand. We are acting upon the supposition that this is an inferior court, and that its decision is binding upon us, and that we must necessarily allow these claims. Why so? This was nothing but a resolution of the Senate, adopted on the 9th of March, 1865, making it the duty of the Secretary of the Navy to organize this board, and directing them to make a report. It was no law of Congress, and this board had none of the attributes of a court. In fact, their proceedings did not possess the solemnity that should attach to a court, and of course we are under no obligations whatever to pay their awards. I understand that this was a mere preliminary proceeding to ascertain the amount of loss sustained by these parties, and if they did sustain any loss, then to open the courts to them, so that there might be an investigation and the amount found due paid.

If the Senators who are urging the passage of this bill will bring in a measure to open the

Court of Claims to these parties, not to investigate their legal claims against the Government, because they have none, but to ascertain the amount that is equitably due to them, I am perfectly willing to vote for it. If they have sustained losses on all their contracts taken together with the Government during this period of time, I am perfectly willing to open the doors of a court where they may be heard; but I am wholly unwilling to adopt the proceedings of this board and call it a court binding upon me. Why, sir, I have no evidence before me, nor has any gentleman yet stated that such evidence is before us or can be produced, that this board went outside of the representations of these parties themselves except what was stated by the Senator from Indiana, who always states his positions correctly, that experts, men learned in this business of building ships, were introduced perhaps to testify as to the general cost of these things. Let us look at this report for one moment. Here is the contract for the Winnipec:

"The contract for the Winnipec was made August 21, 1863, to be completed in eleven months; but the vessel was not completed and accepted until March 20, 1865."

Why was that? I see that the parties in this case are allowed every dollar that they claim. The Government is allowed nothing on account of this delay. This board awarded to these parties $63,715 41 for losses, and yet the vessel, which was to have been completed in eleven months after the contract was entered into, which would have been in June, 1864, was not completed until the war had nearly closed. I see no sufficient excuse for that.

Here is the case of the monitor Camanche. What amount do these gentlemen say we must allow them? One hundred and seventy-nine thousand nine hundred and ninety-three dollars and eighty cents, the amount of loss, as we are told, sustained by these contractors. What was that contract? It was made June 20, 1862, and the vessel was not completed and delivered until January, 1865-not more than two or three months before the war was concluded. I know that some reasons are stated why the work was delayed, but when we come to look at those reasons they are unsubstantial.

I will now refer to the iron-clad Onondaga. We are told on the sixth page of the report that

"The contract for the iron-clad Onondaga was made May 26, 1862, and was completed February, 1864; the contract price was $625,000, the cost claimed was $710,156 51, and the award $85,203 91."

Now, let us see what the committee say was the cause of this delay:

"The delay in the completion of the vessel was occasioned by scarcity of labor, difficulty of obtaining materials, strikes, and having to close his shop for two months on account of mobs in the summer of 1863.'"

Was it in consequence of any action of the Government? Was it in consequence of the depreciation of the currency? There is not a word said about that; but we are told that it was owing to the scarcity of labor, the difficulty of obtaining the materials that entered into the construction of the vessel, and strikes. Why, sir, these things all occur, and they are things, as was very justly said by the Senator from Kentucky, that contractors always take into consideration. Is the Government to be responsible for these things? Surely not. I do not wish to take up the time of the Senate. If these parties have lost money I really want to allow them something. I do not ask that these parties shall be broken up, or that they shall be ruined when they were doing the best they could, and acting very much as the Government itself was acting, (as was very correctly stated by some Senators,) in the dark, in the construction of these vessels. I am unwilling under all the circumstances that they shall lose if they have lost; but what evidence have we that they have lost?

Mr. COWAN. Was not that the purpose for which this board was created, to ascertain the amount of the loss?

Mr. HENDERSON. I presume so; but surely it has none of the sanctity of a court.

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The Senator from Pennsylvania is too good a lawyer to insist upon anything of that sort; and as I understand, this was a mere preparatory proceeding to see whether any legislation should be had on the part of Congress to open the doors of the courts. These parties cannot go now into the Court of Claims and claim damages or ask to be reimbursed for these losses, because they have no legal right to go there. But if they have sustained losses, let as go to work and legislate so that they may be reimbursed; but how? Are we to take as conclusive this proceeding? I do not understand, as the Senator from Pennsylvania will see on the first page of this report, that there was any evidence taken except the statements of the contractors and the bills that they produced.

I do not charge anything corrupt or anything fraudulent upon these contractors, but I do not know that all these bills that are produced by the contractors went into these identical vessel They were constructing other vessels. I do not suppose that the bills show what vessels the different items were contracted for. The bills do not show into what vessels the items went. As I have shown already in one case, as I understand, Mr. Eads contracted for five or six vessels, and it seems he lost but upon two. I know that Mr. Eads is an honorable gentleman; I am personally acquainted with him; and I know he would not present bills containing items that went into other vessels; but I do not know these other parties; and I will not act even in favor of Mr. Eads, although he is an honored citizen of my own State, until I know that he made nothing upon the other vessels that he constructed for the Government. Such surely is not now my understanding. It may be so. I have had no conference with him on this subject except what I have mentioned, and that occurred a year or two ago.

$2,250,000-a very large sum of money-but also from the principles upon which it is founded, and especially since the statement made by the honorable Senator from Massachusetts. He admits the correctness of the general rule of law that parties may enforce contracts fairly construed, without any hardship, and if losses occur to the contractor it is his loss; if, on the other hand, profits are made, it is his benefit. That rule is applied to all contracts for the Government by individuals, and no one feels it to be a hardship.

But the honorable Senator from Massachusetts now states that during this war, and by reason of this war, this principle of law cannot be applied and ought not to be applied. If that is true, then there is no end and no limit to the|| claims upon the Government. If that is true, the same claim that is made in this case may be made in behalf of every person who has furnished oats or hay or corn or supplies of any kind to the Army or Navy. It will apply to every class of claims that is made against the Government. It may be applied to every officeholder of the Government, to every person whose salary has been fixed on a specie standard, to every person whose expenses have been changed by the existence of the war. It would apply to all classes of contracts as well as to mechanics.

Now, I venture to say that there has been no time in the history of America when the mechanics of this country have been so prosperous and have made such large sums of money as they have during the recent war. Great activity has been given to all branches of industry. Every man who has had a shop or who has been engaged in mechanical employments has had constant occupation. All classes of industry have been made prosperous by the demands arising out of the war. The absence of laborers in the field of battle, the absence of Now, Mr. President, notwithstanding these ordinary competition, the vast supplies needed contractors may have lost something, I think by the Government, and the purchase of everywe ought not to act here in a matter of so much thing that enters into the consumption of human importance, a matter involving over two mil-life were so great during the war that all classes lion dollars, without knowing whether we are disbursing it for the proper parties or not, without knowing that it is justly their due and whether they are entitled to it as men who have done so well as the Senator from Massachusetts claims. I recognize their claims. I recognize the great service they have rendered to the Government. But I apprehend that the most of them undertook this work with a view of making something upon it, that they made the contracts with a view of making money; and, as has been very properly said, these men are shrewd, capable men. They know very well how to make their contracts. If there was any action of the Government which caused them to lose, if by taking, as in the case of the Camanche, the machinery that was provided for that vessel and putting it in another vessel, they were delayed in the construction of the vessel and loss was occasioned in consequence, I am perfectly willing to allow for it; but I will not allow it upon the report of this board. I cannot do it. do not understand that it was appointed by a joint resolution of Congress. I do not understand we are under any obligation whatever to confirm the awards made in their report. I do not uuderstand that they have taken evidence such as they ought to have taken. I do not understand that both sides of this case have been

of business men have been prosperous. I venture to say further that the very class of men for whose relief this bill has been provided have been more prosperous during this war than ever before. It is a matter of common remark that they have made large sums of money. Nearly all the wealthy manufacturers have become more wealthy; and this has extended not simply to those articles consumed by the Government, but to all articles of manufacture. There is no class of the people of this country for whom the Senator from Massachusetts could with less force appeal for sympathy than for the mechanical and manufacturing interest of the country, simply because by the extent and nature and character of the war they have had constant occupation and employment without the ordinary competition.

Now, the question arises whether we shall deliberately indorse a principle by which every contractor of the Government may claim from us the losses he has sustained on one particular contract. If the rule was applied generally, and you attempted to ascertain the loss of the individual and reimburse that loss, that would not be so heavy; but that is not the case here. Here a particular class of vessels is selected, and it is shown that the contractors haye lost money upon those vessels. Now it may be that these same contractors, as I know heard. It is exceedingly difficult to get the is the case, because I know some of these contruth even when both sides are heard, but you tractors, have made very large sums of money never get the truth when only one side has on other contracts with the Government. It is been heard, and I see nothing to satisfy me not proposed to deduct those profits; it is not that more than one side has been heard in this proposed to make an equitable rule upon the whole investigation. It is yet to be shown that such is the fact. I have not seen it, and quantum meruit principle, and giving them only what is properly and justly and fairly their I have yet to learn it. No gentleman has loss in all their transactions with the Governstated it on the floor; and yet this bill is per ment, but you are to select a particular class tinaciously urged upon us. I cannot vote for of contracts, a particular class of vessels, on it, and I hope other Senators will not vote for which there has probably been a loss of some it until we are better prepared to do so. two millions, and you are to reimburse that Mr. SHERMAN. Mr. President, the im-loss, leaving them to enjoy all the profits they portance of this bill arises not only from the have made on their contracts with the Governamount of money involved in it, which is ment.

I venture to say that every person who owned a machine shop in the city of New York or Philadelphia, or the State of Ohio, who has been employed directly or indirectly in the manufacture of the muniments of war, has made several times the cost of his entire property before the war, if he has managed with ordinary skill, simply because those works have been constantly employed. And yet, because these particular contractors have lost money in the building of a certain class of vessels, you propose to reimburse that loss. It seems to me we ought not to enter upon such a field. I am staggered at the probable results of such a policy. If this bill passes upon the ground on which it is now placed by members of the Senate, we shall have claims without end, and you cannot resist them. There have been cases where persons contracted to deliver hay at fifteen dollars a ton and have paid twenty-five dollars a ton for it. Contracts have been made for oats, for wheat, for transportation, for supplies, for all kinds of muniments of war. Why do you not apply the same principle to those class of cases? You cannot resist them, if you once adopt this rule. I, therefore, am not prepared, on a question involving so large an amount as this particular case, and a principle which involves millions more, to vote for such a proposition.

The Senator from Massachusetts places this claim upon another ground, which I think has been sufficiently answered by the Senator from Missouri, and that is, that we instituted a court; they have made an award, and we are bound to carry into execution that award. If this were a court organized by law, and if an award had been made by it upon principles of law, I should feel bound by that award, although I might not approve of the principles adopted by the court; but that is not the case here. Every day we pass resolutions of inquiry; we call upon the Secretary of War, or the Secre tary of the Navy, or the Secretary of the Treasury for information. He furnishes that information. We do not bind ourselves before hand to adopt the conclusions of the Secretary of War, or the Secretary of the Navy, or the Secretary of the Treasury. We do not even bind ourselves to take the facts that he gives

us.

So in this case, at the end of a long debate, at the end of a controversy upon this very class of claims, a resolution was offered, I think, by the Senator from Iowa

Mr. GRIMES. Oh, no, I did not offer it. Mr. SHERMAN. Some one offered the resolution in the Senate, and my impression is that I voted for it, because I wanted to know the facts.

Mr. GRIMES. It was offered at the executive session, and there was no debate upon it.

Mr. SHERMAN. The very fact that the chairman of the Naval Committee cannot tell when this resolution was offered, under what circumstances it was offered, and what inducements led to its being adopted, shows that it had no influence whatever and ought to have no influence whatever in our deliberations.

Mr. CLARK. The Senator will see, if he looks at the resolution, when it was offered. It was offered on the 9th of March, 1865.

Mr. SHERMAN. At the executive session? Mr. CLARK. It must have been, for Congress adjourned on the 4th of March.

Mr. SHERMAN. That shows the folly of basing any argument upon the resolution, except the facts that the committee have brought before us.

Mr. McDOUGALL. The Senator from Ohio will allow me to inquire of the Senator from New Hampshire whether he understands that the resolution was adopted after Congress adjourned. I was present when that resolution was passed.

Mr. CLARK. Here is the record on the report: In the Senate of the United States, March 9, 1865."

Mr. JOHNSON. That shows when it was adopted.

Mr. CLARK. That is the time, I suppose, when it was offered.

Mr. SHERMAN. Congress adjourned on the 4th of March.

Mr. CLARK. It could not have come over, then, from the regular session of Congress.

Mr. SHERMAN. That shows very clearly that the resolution can have no effect on the debate. It was a mere resolution of inquiry. The Secretary of the Navy could not furnish this information himself, and therefore, at the suggestion of some Senator, we do not know who, it was proposed that the Secretary of the Navy should get this information by means of a board composed of some of his subordinates.

Mr. CONNESS. I will state to the Senator that the resolution was offered by the honorable Senator from Nevada, [Mr. NYE,] I think, upon the last day of the executive session.

Mr. SHERMAN. The resolution itself was proper, and I have no doubt I should have voted for the resolution, because it tended to procure facts that might influence the judg ment of Congress. I cannot say but what if a particular case of hardship was furnished to me, a clear case of loss, and especially if that loss was caused by any act of the Government, I might be willing to reimburse that loss of money caused by the Government. I probably would have voted for the resolution asking for this information, but it has no effect on the judgment of the Senate now. This information is given to us simply like ordinary information from an executive Department. It is not sustained, so far as we know, by any oath. It does not appear from the report, so far as I can see, from the beginning to the end, that any one of these contractors was put on oath.

Mr. HENDRICKS. The testimony was all under oath.

Mr. SHERMAM. It is not stated on the face of the report. At any rate, it is ex parte in its very nature. Now, it seems that the amount of the claims, according to one allegation of this report, was $2,383,520 20, and the amount of the awards is $2,267,627; so that it appears that they have scarcely made any variation between the amount of the claim and the amount of the award. This is always a remarkable fact, because we know that human interests prompt us strongly

Mr. CLARK. If the Senator will pardon me, the board were not to report what they thought due, but what was the cost of these vessels, and they, of course, would take that from the contractors.

Mr. SHERMAN. I say that the losses claimed before the board by the parties in interest were $2,383,000, while they actually awarded the sum of $2,267,000. That very fact shows that they did not scrutinize these claims very closely, because it is not in the nature of things, be men ever so honest, but that there would be a greater difference between the aggregate of claims among a great number of contractors and the aggregate of awards than is made in this case. It is only a difference of three or four per cent. I do not deny that there may be many meritorious cases in this report; but I can only say that the principles upon which this report is founded are not such as will induce me to vote from the Treasury of the United States two and a quarter million dollars, and establish a principle which, in my judgment, will lead to a very large expenditure.

Senators must remember that we shall be called upon before this session closes to pass upon a character of claims that will test the judgment of every Senator. A demand will be made upon us by those who are most deserving of our bounty and our favor, who have protected and maintained the Government during four years of terrible war; a demand will be made by the soldiers for $200,000,000 for the equalization of bounties. A demand is made by the loyal States, and a bill on the subject is now being pressed in the House of Representatives, for $150,000,000. Demands of every character and kind are constantly pressed upon Congress. Indeed, if we do not resist with a firm and unyielding hand here in

the Senate, where the body is of a more permanent and durable character, these claims upon the public Treasury-the expenses of this year may run up to a period of one year of the war -we may destroy the interest of all the widows and orphans and the people of this country who have invested their property in the public debt; we may impair the public debt; we may adopt principles which will lead to expenditure without limit and without restraint. I, for one, am disposed to scrutinize carefully every claim that is now made upon the Government, and to yield only when that claim is proven to be just and proper, but not sooner than that.

Among the persons who would be benefited by this bill is a gentleman whom I regard as highly as any man in the State of Ohio; a man of great energy, skill, and capacity, and yet I could not be influenced by a desire to give him even what he might claim to be just, to vote this large sum of money and adopt a principle which might be injurious to the people at large, at least without further testimony than we have presented to us in this report. If, however, the matter is pressed to a vote, I intend before the subject is closed to offer an amendment, which I will now read, and which, adopting the principles upon which this bill is founded, I do not see how any member of the Senate can vote against it. It is to add to the amendment of the Senator from Iowa the following:

Provided further, That no payment shall be made to any person, firm, or corporation who have received profits on other contracts with the United States, greater than such award; and for the purpose of ascertaining the same the said board is hereby reorganized, and shall inquire and determine the profits of each person, firm, or corporation derived from such other contracts, and such profits shall be deducted from such award.

If the principle on which we are asked to act in this case is to be adopted, then, as a matter of course, this same board ought to extend their observations beyond these particular contracts and ought to look and see whether the individual, firm, or corporation whose poverty or distress we are about to relieve is not already rich in accumulated profit on other contracts. It may be that this board will find that although in these particular cases of contracts losses have been suffered, yet these very contractors who are appealing to our sympathy, and who have so excited the sympathy of our friend from Massachusetts, are now wealthy far beyond their highest ambition before the war occurred. If the principle is to be adopted of making good all the losses, we ought at least to be credited with the profits growing out of this war.

Mr. MCDOUGALL. It is pleasant for me to be once in accord with the Senator from Massachusetts, [Mr. SUMNER.] I think with him that Governments should be protectors and not oppressors. There seems to be a great lack of information here on matters of and about which every Senator on this floor should be well informed. These claims were presented to the Senate at an early day of the last Congress; they went to the Naval Committee, but the accounts stated were not satisfactory to the Navy Department, and the Senate itself passed a resolution directing an inquiry to ascertain the actual cost of these vessels and their machinery. The vessels were at that time esteemed highly-more so than they seem to be by some now. A board was organized of men of the most accomplished skill in such matters, nominated by the official representative of the Executive of this Government. It was not necessary that the men should be of great accomplishments in many respects, because they were only to inquire what was the true cost of these vessels and their machinery. For six months that board sat in continuous session at the Brooklyn navy-yard and in the city of New York. The board represented the Government of the United States, having been se lected by the Secretary of the Navy. Testimony was taken pro and con, every man under oath, as in a court of justice. It was carefully done by men who understand the law of carefulness, as men who are educated to the business of officers of our Navy and engineers and

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constructors in the naval service do understand it; done carefully as it could be done by men who understand what is the underlying basis of all truth, mathematics. After careful investigation, at the invitation of the Senate, under the orders of the Secretary of the Navy, we have had their results on our tables for a long time. The detail d testimony was submitted to the Naval Committee, and as the conclusion of the deliberations of that committee this bill is submitted to us, no member of the committee dissenting except one, and he is a dissenter; but he does not controvert a single thing af firmed in the report of the board that sat at Brooklyn, presided over by Commodore Selfridge, or a single thing that is affirmed by the committee who investigated the subject.

Now, it is well that there should be some objectors. That is the vocation of the Senator from Iowa, and I may say the same of the Senator from Ohio. But it is well to affirm the right. Governments have no right to do wrong any more than individuals. When these contracts were made the price of labor was altogether different than during the period when the contracts were performed, and why? Because of the exceptional condition of our country, well stated by the Senator from Massachusetts, and there are exceptions that prove rules. I remember well that there came forward men of large fortunes, men of great enterprise, men of high patriotism, willing to lend their fortunes and hopes to the Government. They were perhaps too old for arms; I saw many of them; they said, "We will furnish you arms, we will build you ships, build you anything; all we want is an order." The men who came forward to build the iron-clads were of that class, the best men of the country, and men not only of great mechanical skill, but who had won wealth by their enterprise and their skill, and were ornaments to the country. They came forward willing to hazard their fortunes. No one could anticipate, as the Senator from Massachusetts well remarked, it was not within the precognition of any human being, what would be the. condition of the country twelve months from the time. What happened? Money, not the representative of money, rose to two for one. Prices appreciated accordingly two for one.

Again, the exigency of the Government required all the labor to be employed and three times as many rolling mills as could be obtained in Pennsylvania and otherwise to get out the material for clothing the iron-clads; consequently up went iron.

All these things were not within the possi bility of contemplation by the most prescient men. It was special to this class of enterprise. I think that the first Secretary of War under the last Administration gave contracts to some people to build wagons who made great fortunes, and contracts for saddles, out of which great fortunes were made, and so of contracts for harness, and cattle, horses, and many other things. But the business of building these iron-clads was a business of dollars and cents; it could be shown by the books, proved by exact testimony, established as a fact in a court of justice, how much they cost. It was well known by these gentlemen that they would be ruined unless the Government would protect them. They came forward and built their ships; they put them on the sea; they destroyed their enemies. They knew then that they were expending I think at least thirty per cent. over and above what the contract price was, and that their whole fortune was gone unless they should be protected. They came here; they asked relief from the Senate. The Senate sent them to the Secretary of the Navy, asking that it should be carefully inquired into, not what was a fair profit on this labor, but what was the cost of material and labor, and that award is sent to us, and I say we shall be dishonest if we do not pay it. I do not believe it belongs to Government to be dishonest.

Mr. HENDRICKS. I shall detain the Senate but a few moments in answer to a point or two made by the Senator from Missouri and the Senator from Ohio. I do not think that

their view of the subject is just to the parties that present this claim. In the first place, the Senator from Missouri says that before the board that was organized there was no evidence, so far as he can observe, except the testimony of the parties themselves. Now, Mr. President, I think that if the board was satisfied with that evidence and reported it as satisfactory, we should be slow to question even that testimony, for during the last Congress we made parties to actions competent witnesses in ordinary suits in the courts between man and man; and if this board received the testimony of the parties themselves, together with their books of account, their detailed statements of expenditure, and relied upon that, I should not disregard the results of their investigation because of that alone. But the Senator has not thoroughly examined the report of the board, as he stated himself, else he would have found very material testimony in addition to that of the parties themselves; and I will call his attention to the testimony of Naval Constructor Pook, on pages 30 and 31 of the report of the board. I will read just one or two sentences of that testimony to show the character of it. In answer to a question, he

says:

"Having examined the bills of cost and extra work of gunboat Chenango, built by Jeremiah Simonson, I find them to be fair and reasonable in every respect. Having examined the bills of cost and extra work for the gunboats Massasoit and Osceola, built by Curtis & Tilden, I find them correct, charges fair and reasonable, and consider that the bill for extra work should be paid in full. Having examined the bills of cost and extra work for the gunboat Pontiac, built by Hillman & Streaker, I find them correct, charges fair and reasonable, and consider that the bill for extra work should be paid in full. Having examined the bill of cost of gunboat Wyalusing, built by C. II. and W. M. Cramp, I find it to be correct, fair and reasonable in every respect. Having examined the bills of cost and extra work for the gunboats Agawam and Pontoosue, built by George W. Lawrence, I find them correct, fair, and reasonable, and consider that the bill for extra work should be paid in full."

And he goes on with other accounts. Then he comes to another account where he says he finds these items not to be fair and correct, and that they ought not to be allowed as they are presented; and upon his testimony the naval board acts. Then I find that Naval Constructor Delano, an experienced man in the construction of vessels-of-war, was also a witness before the board; also, Assistant Engineer Pierce and Chief Engineers Lawton and Brooks were witnesses before the board. I have been able to refer to these during the discussion. What other testimony there was before the board in addition to the testimony of the parties, I am not able at the moment to say; but this testimony of these officers of the Government is upon the very points that the board was investigating.

Mr. HENDERSON. The Senator will excuse me for interrupting him. The point to which I wish to direct his attention is this: did these parties who were witnesses before the board, and to whom he now refers, have any personal knowledge of the work, or were they connected with it as superintendents in any such manner that they would neccessarily know that these were the items of articles that went into the construction of these identical

vessels?

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officers of the Government employed in the
construction of vessels. Whether they were
superintendents of these particular vessels I
cannot answer the Senator, nor do I care.
They knew the character of the vessels, their
dimensions, and all about them; and when
called upon to examine the accounts presented
they say that those accounts are correct. It
must be so, because they know what would
necessarily go into a vessel of the sort.

Another point made by the Senator from
Missouri and the Senator from Ohio is that we
are not required to give much force to the find-
ing of the board; for what reason? For the
reason that that board was organized pursuant
to a resolution of the Senate. I am not able
to understand the moral force of that argu-
ment. If the House of Representatives had||
concurred in the resolution, and a board, com-
posed perhaps of these same men, had been
organized by the Secretary of the Navy under
a joint resolution, do the Senators believe that
the investigations of the board would have been
more thorough than they were when it was
organized by a resolution of the Senate? Where
is the force of that objection? These officers
were discharging a duty to the Government.
Did they not do it fully and fairly? If the
award of arbitrators is questioned because of
partiality, mistake, or fraud, you must show it;
the fact must be made known; and in the
absence of some evidence on the subject the
award is presumed to be honestly made, and
made upon a full investigation of the case.
Now, here is a board organized pursuant to a
resolution of the Senate. I was not present,
as I now recollect, when that resolution was
passed, for I think I left a day or two before
the adjournment of the extra session, and I
knew nothing about its introduction or its pas-
sage; but it is a resolution of the Senate, and
a board is organized pursuant to it to do a par-
ticular duty for the Government. Why is it
that the finding of that board has less moral
weight with the Senate than it would have if
the board had been organized under a joint
resolution of the two Houses? I am not able
to see.

The Senator from Missouri referred to the
case of the Onondaga. That vessel is said to
be one of a very fine and very superior order.
The Senator said that the delay in the con-
struction of that vessel was not occasioned by
any act of the Government. If he will turn to
page 19 of the record of the board, he will find
that he is mistaken.
It appears there:

"That the causes of delay in building the hull and
machinery of the Onondaga were on account of ex-
pensive alterations, and also the same as apply to the
Chenango and Ascutney."

Expensive alterations were ordered by the Government. Both Senators referred to the fact that some of these parties may have constructed other vessels and may have made profits out of those vessels, and it is proposed by them to set off the profits that may have been made in the construction of other vessels against the losses that were sustained on these. Upon what principle does that rest? It is a new idea to me. I know nothing about this except that I heard it stated, from no reliable authority, that Messrs. Eads & Co., constituents of the Senator from Missouri, had made money in other work. I know nothing about it except just as I have heard a rumor to that effect. Suppose that Eads & Co. did make money in building some other ship, was it not right that they should make something? Ought the profits that were made by them in the pursuit of their business, profits that they would have made in doing work for individual citizens of the country, be taken away from them because they sustained a loss on other vessels? I do not understand this proposition of setting off profits that may have been made on other vessels as against losses sustained on these. I do not understand it either as a legal or a moral proposition, unless they obtained the contracts on which they made the profits by improper influences, unless there was fraud in them. Then perhaps there would be some moral propriety

in off-setting. I do not know that the contracts were made all together; but I think they were different contracts for different characters of vessels. I know nothing about it; but if they made profits, it is what mechanics expect, that they shall make some profit, and I cannot see the principle of taking away their profits on one vessel because they sustained a loss on another.

Mr. President, suppose that Eads & Co. in 1862 made a contract to build two vessels, and the Government suggested from time to time alterations in those vessels, and they are the losers upon those vessels to the amount of $50,000, and suppose they take contracts for two other vessels, and the Government does not interfere at all, there is no trouble about them, and they go on and complete their contracts within the time specified and they make a profit on those contracts, why shall you take that away which is right and which they ought to enjoy to set it off against losses which were occasioned in part by the act of the Government?

The Senator from Ohio used an illustration that I think is unfortunate for the purposes of his argument. He says that men have lost money by buying corn, oats, horses, and other things for the Government during the war, and that we upon the same principle that we indemnify the constructors of iron-clads and monitorsought to indemnify those ordinary contractors. I am surprised that the Senator does not see a difference. A man goes to a quartermaster or a commissary for what purpose? Not to produce but for the purpose of buying and then selling to the Government upon speculation. His purpose is exclusively to make a speculation. The mechanic in his shop produces; he is not a speculator; he is a laborer. He expects by his labor and his enterprise and his skill and his judgment to make a profit, and he makes a contract with the Government and the Government interferes with him in the prosecution of that contract and he asks to be reimbursed; and it is said to him by the Senator from Ohio, "You, a mechanic that expend your money and your labor for the benefit of the Government, stand upon the same moral proposition as the speculator, the shoddy contractor, who expected profit and nothing else when he made his contract." A man contracts with the Government to furnish corn or hay or oats for the Army; he expects to go out and make his purchases at once to fill his contract; he knows what the prices are, and he can go out and satisfy his contract at once. If he contracts to supply a thousand head of horses at $100 a head, he knows what the present cost of horses in the market is and he goes out at once and fills his bid.

Mr. KIRKWOOD. Suppose the horses are to be delivered three or four months hence, and the price rises in the mean time?

Mr. HENDRICKS. Then he takes it as a speculation; but I say that the mechanic who

undertakes to do work for the Government which cannot be completed within six months, and which is not, because of the act of the Government, completed within eighteen months, does not stand before the country and before Congress as a speculator. Here are men in New York that have shops; they are doing work for the country; they are building machinery for the demands of the business of the country, making money, and the Government says to them, We want a ship built." They devote their entire energy, their capital, and their machinery to the production of this ship. It is not a matter of speculation; it is an enterprise for the benefit of the Government.

Mr. TRUMBULL. Will the Senator from Indiana allow me to inquire whether this is a bill for the benefit of mechanics or contractors? How much of this money will go to the workmen that he is talking about?

Mr. HENDRICKS. I do not know of a single case in which this does not go for the benefit of a mechanic. There may be some of these contractors who are not mechanics, but I am not aware of a single case of that kind.

went

The workman, the particular mechanic who assisted the contractor in his shop, has received his wages from month to month. As the wages up he was paid. When the contract was made the laborer got eleven cents an hour. In two months from that time he got thirteen cents; two months further on he got fifteen cents; and two months further on he got eighteen cents. He has been paid this; he could compel the contractor to pay it. The contractor himself is the mechanic, investing his labor, his skill, his judgment, and his means in his shop; and he produces a vessel that is acceptable to the Department and that is valuable to the Government. I say he is not to be compared to the man who goes out into the market to buy up what may be needed for the Army for the purposes of speculation.

The Senator from Ohio says that mechanics have made more money during the war than they ever made before. If the Government had not expected of these mechanics to construct ships, and they had been left to pursue their ordinary business, they, too, would have enjoyed the advantages, so far as advantages were enjoyed, coming from the war; but having to construct these ships, they are losers. Does the Senator question the fact; does the Senator doubt the fact that they are losers? Then why does he say that mechanics have made money? We are talking about these particular cases. They have not made money. Other mechanics have made money, I admit. The Senator, I presume, is aware of the fact that for three years back the railroad companies have not been able to make contracts for the delivery of locomotives at any period in the future; and why? Because mechanics have known for three years past that there was a constant advance in the cost of material and labor, and they would not make contracts for future delivery, but required the companies to pay what an engine was worth when produced. But here the Government obtained from these parties their contracts; and the question is, under all the circumstances, shall they be held to the bond?

The Senator says the award is large; it is $2,267,000. That is what the board say were the losses. I think myself that the losses ought to be paid because they have been occasioned in part by the act of the Government. The Senator from Nevada proposes by his amendment that it shall be restricted in the highest case to fifteen per cent. upon the contract price. I believe that would reduce it very nearly a million dollars. The Senator from Ohio proposes that it shall be twelve per cent. I think, then, the reduction would be something more than a million dollars. The precise amount I cannot state to the Senate.

Mr. McDOUGALL. Permit me to ask the Senator a question. I have not listened to the entire debate. Is there an exceptional case in regard to the Camanche?

Mr. HENDRICKS. Yes, the Camanche is excepted by the amendment. The entire award was $2,267,627 18. A restriction to twenty per cent. upon the cost price would be $1,721,524 68. Reducing it to fifteen per cent. I suppose would allow $1,300,000 or $1,400,000; and reducing it to twelve per cent. I suppose would leave it about $1,000,000, so that the Senator from Iowa proposes that these contractors shall lose above $1,000,000 by his amendment. Now, I submit to the Senate that as the entire loss is proven before a board organized by the Government itself, at least by a Department of the Government, to be above $2,000,000, is it not enough that you ask it to be reduced $1,000,000, that you should make fall on these contractors a loss of $1,000,000 ?

The Senator from Ohio says that this was an ex parte examination. If it were proposed between two men to arbitrate a matter of dispute between them, and it was agreed that one of the litigating parties should select all the arbitrators, perhaps it would be said that was ex parte. He selects the court himself, and certainly he cannot complain of the award when made. Under a resolution of the Sen

ate the Government itself selected the board. These contractors, whose interest depended on the judgment of the board, had no voice in the selection of the men that were to try their case. The Secretary of the Navy, representing the Government, organized the board. That board, having no interest, no sympathy with the contractors, but of the Government's own selection, heard the testimony for five months, and made its award.

Mr. SHERMAN. As a matter of curiosity I would like to ask my friend from Indiana if the Supreme Court of the United States is an ex parte tribunal. I need hardly ask him for

an answer.

Mr. HENDRICKS. No, sir, I never esteemed it so.

Mr. SHERMAN. And yet the Supreme Court of the United States is selected by the President of the United States, and decides causes in which the United States are interested. Therefore his argument that this is an ex parte board, because appointed by an officer of the United States, is hardly of much force.

Mr. HENDRICKS. The suggestion of the Senator is forcible, but it was not myself that was saying this was an ex parte proceeding. I have not complained of it as an ex parte one. I am answering the argument of the Senator from Ohio; he said it was an ex parte proceeding, and the award was ex parte. If it was ex parte at all, I was going to show it was ex parte on the side of the Government, not on the side of the contractors.

Mr. SHERMAN. The evidence was ex parte, that is what I said.

Mr. HENDRICKS. So far as the evidence is concerned, it is from the mouth of the parties themselves and from the mouth of Government officials. Neither in the organization of the board nor in the evidence that was heard

by the board was it an ex parte proceeding. If the Senate are willing that these men shall be destroyed in an enterprise that was so important to the Government at the time, in an enterprise in which they were materially interfered with by the Government itself, then I submit to the judgment of the Senate, it is not my judgment. I do not think our country requires it. I do not think the constituency I represent ask it at my hands. I do not think that between man and man they would themselves render such a judgment. When the Government itself has interfered so that the contracts were not completed at the time contemplated, so that these parties had to pay instead of sixty dollars, $145 per ton for iron, I do not think that the constituency that I represent will desire me to say that all of this loss shall fall upon the enterprising men who gave up their shops from profitable employment to an employment that yielded no profit. We ask no profit for it; we ask simply that they shall not be destroyed; and the proposition of the Senator from Iowa is (and with the slight amendment proposed by the Senator from Nevada I will agree to it, and if that should not meet with the concurrence of the Senate would then agree to the proposition of the Senator from Iowa) that of the $2,267,000 of loss more than $1,000,000 shall still fall upon the contractors.

Mr. RIDDLE. Mr. President, the hour admonishes me that I have but a short time to speak, and I shall detain the Senate but a few minutes. I shall vote against this bill in its present form. I shall vote for the amendment of the Senator from Nevada in the first place, but I would prefer the amendment of the Senator from Iowa. With either of these amendments attached to the bill, I am willing to vote for it.

There is one fact that has escaped the attention of Senators upon this floor, and it is a question of contract. If I had not already been convinced, the Senator from Ohio would have convinced me by his argument that if you open the door in this matter, other contractors can come in and claim additional compensation. I am for additional compensation in these cases, but not in the way it is asked for in the bill.

In my city the largest firm there built two of the largest monitors and have not asked for additional compensation. They have not come forward to knock at the doors of Congress and ask for additional compensation. Another firm in my city comes forward and asks for it. Now, how do they predicate their contracts? My friend, the Senator from Indiana, alluded to a contract for a house a few minutes ago. How does such a contractor predicate his bid? He goes around and asks the stone-mason how much he will put up the stonework for; he asks the brick-layer how much he will put up the brickwork for; he asks the plasterer how much he will put up the plastering for by the yard; so with the shingling, the roofing, and all; and before he takes the contract he predicates his bid on the sub-contracts he can make. How do these machinists do? How have they done? I know how they have done; the Senator from Ohio knows how they have done. Before they make a contract with the Government they make arrangements for the iron and steel conditioned on the receipt of & contract from the Government; they get the material at the price it was worth when the Government asked their proposals.

Now, if you give fifteen per cent., or twelve per cent., as the Senator from Iowa suggests, that pays amply for the increased cost of labor; the mechanics do not suffer; they will lose nothing by this operation. But in the event of passing the bill as reported the contractor makes the money and the mechanic gets nothing out of it. This is a fact which can be substantiated by every practical man living in a city where these iron-clad vessels have been built; although an institution in my city is interested in it, I care nothing for that. I say that unless the Senate adopt the amendments offered, I shall oppose the bill and take another opportunity to consider the subject.

Mr. CLARK. I have found a good deal of difficulty in regard to this class of cases, and the difficulty arises from their being classed together. I have no doubt, from the examination I have made, that there are meritorious cases included in the bill, and perhaps there are some cases which ought to have as high an award as this board has reported. I am satisfied from the examination I have given that there are others who ought not to have anything at all; so that if I vote for the bill either in the amended form or in the form in which it. comes from the committee I am likely to do injustice to somebody.

I have been, Mr. President, casting around to see what we could do with a proposition of this kind. It first occurred to me that you might refer it to the Court of Claims, but yet I am satisfied that the Court of Claims would not do justice to some of the cases that are heré, because a man may not have a legal claim who may have an equitable claim, and he would not. be able to recover there; and yet I am satisfied that this board, which was constituted at the last session of Congress, was not a board to report upon what was due to these contractors; it only considered one side, that is, what the vessels had cost these men; it did not consider the other side, what deductions ought to be made by the Government in paying them the amount; so that it cannot be called any fair arbitration, or award, as the Senator from Indiana termed it, because they considered only one side, that is, the cost. If the question had been submitted to the board what deductions shall be made from the cost when you find it, that would have been an entirely different thing; but they were instructed only to consider what was the cost of the vessel in each case, and report to Congress. And yet the Senator from Nevada says that having committed it to them to award the cost, we are bound to pay it. I

do not understand it so.

Mr. NYE. I did not say exactly that. Mr. CLARK. That was the substance of what I understood the Senator to say. Mr. NYE. I said that, admitting the prin ciple that anything is to be paid, we should pay the ascertained cost.

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