Year: 1862

sation waoiy ana exciusavey PAD py me government
der ths hauoination st th money does not come from
the government, and adms that Il did, il his agent
nsArae, psysSss BY SAs government, 4 would unques
tOnaby have been violation Of law His language is
sIAw hes not been violated by the establishments and
operation Of the system II unauesonaby would have
been II had appointed mercantile agent to do this
work a. Axsd salary or ss per censage however mode
rate"


the Secretary Of the Navy here admits that this
per csnage had been paid the the ransac
your COMMITTEES ask the attention Of the Senate brief
examination OF that question: question may be called


TO the minds Of your committee nothing can be palmer
than that every seller Axes the price Of the article be
proposes sell reference the OF the
the time Of the sale the vessel for example, has 70
be brought place another before the sale
completed, II Is levied by the government the
SALE centage s payable to the State national
government or to any one else ON the amount received
for the vessel Il be necessary to argue the pr0pos


on that the cost Of such transportation the tax
the per centage considered by the seller In fixing his
price, and m paid by the purchaser Mr. Morgan, it
must be remembered, in every instance in which he
made purchase, informed the person Of whom he pro-
paid 60 him; and it appears your committee
be Impeachment OF common to pretend that the
seller did not include that commission IN the price for
which he consented TO SELL The for which
the vessel 10 be purchased, including that which goes
the seller and that which Mr. Morgan retains in his
hands all comes directly from the Treasury Of the
UnitedSates. and partor 1t from any other source,
and IL impossible for your committee 70 conceive how
the most ingenious and subtle sophstry impose upon
the simplest understanding tho impression belief that
the United states does not directly pay this money.


MERCANTILE


1t Is claimed that this arrangement is in accordance
with the usual mercantile custom. However that may
be-and the committee will say something Of that here
an eminent and highly respectable gentleman of New
York with whom they have had occasion 10 correspond
that the "making government agent for purchases
dependent upon the seller for his compensation and
making that compensation dependent upon the
and costness Of his purchases is immoral and corrupt
ing and tends extravaganza couson and fraud"


Human virtue is fra enough when surrounded by all
the Inducements to honesty which be thrown around
il as safeguards and accordingly has been found to be
the wsest policy in the conduct Of the ordinary affairs
Of life, as far practicable to make duty and interest
TO coincide but by this system of the Secretary direct
pecunary premium Is offered to dishonesty and treache
ry Instead Of its being for the interest Of the agent
carefully guard and protect the rights and interests of
vessel for tho lowest price which she be bought
he has direct pecuniary interest in paying the largest
possible price which the seller cam with any show Of de-
cency, demand and thus his interests are brought in
direct conflict with his duty.


Now although Mr.. Morgan, with the seventy thousand
sponsibty as merchant and man Of business that
this is a wise SYSTEM and If well and faithfully carried
out at this time. highly conducive to the public nte
rests yet 1t unfortunately happens that the universal
judgment OF mankind s Of very different character.
Thus Judge juror is allowed to sit in where
he has the slightest pecuniary interest, and IL IL
known that referee arbitrator or umpire between two
parties was to have his compensation dependent upon
the amount which he should adudgc tho party TO pay
10 the other all men everywhere would Join in denounc
ing his decision II not dishonest and corrupt least
unworthy Of any confidence The proposition that
should act agent for another and have direct
pecunary Interest adverse to his employer and prompt
ing him to mako large purchases at high prices with his
compensation constantly increasing in direct proportion
TO the number Of his purchases and the Of
the prices which ho compes his employer pay
to your committee TO be proposition SO monstrous to
require no argument to demonstrate Its nexpediency
and immortality.


At the time this arrangement made there were
many other other things Of which the government was
beef CATTLE arms &C., and II the system adopted by the
Secretary Of the Navy for the purchase Of vessels
wise and faithful discharge OF public duty, why
would not also be proper mode Of purchasing horses
Yet what would have been said IL an agent had been
employ Cd to purchase horses and receive as com
pensation for his services commission Of two and
half per cent on the amount he should pay for them
Does not every one perceive that such arrangement
upon dishonesty? And your committee are by means
satisfied that just such consequence might natu-
rally have been anticipated 70 follow such an arrange
instead Of saving as the Secretary atters himself he
has. some twenty-five per cent on the amount de-
mandsd by the sellers Of the vessels purchased, he
has not actually paid more for those vessels than
they might have been obtained for II such course
had been adopted. Indeed, to your committee
fact for the very announcement that agent
in the market TO buy vessels for the government,
amount paid for the purchases he might make, sub
mit would naturally suggest TO every seller that here
was rare opport1nty-such as never had occurred be-
again-where the interest Of both buynd seller united
in fixing the largest price that could be demanded and
paid without shocking the moral sense OF the commu
nifty.


TIE QUESTION ECONOMY.


Nor the committee at all shaken in this opinion by
the ostenatous display in parallel columns In the table
affixed to the Secretarys letter Of the price asked and
the price paid for each vessel The p,anner in which
made appear, is by putting down fabulous and errp
prices IN the column OF prices asked side by side
s M paid %o hundred sss @
dollars $3.50 Cc0), and the price paid s two hun
drsd thousand dollars $500 Sgo?, making sav.
ESQ Oo0). The price asked for the steamship Eagle
is two hundred and fifty thousand dollars $780,
ooo and the price PAID Il % one hundred and eighty
saving of sixtyfve thousand dollars (s65 oo0) The
steamship James Adger has an asking price OF hun
the price for which she sold was eighty five thousand
dollars 1856 000 making an apparent saving in the
chase Of this vessel Of forty thousand dollars $40 0oo
gan had in reducing the price asked down TO the price
actually paid was III the purchase Of the steamship Ala
bama, where the price asked was one hundred and
twenty thousand dollars s2o 000) while the price paid
only twenty three thousand dollars (S23 000 thus
showing saving TO the government, in the purchase of
this single vessel OF small value OF ninety thou
sand dollars ($g1 ,C00)!


From these statements taken from this table, your
committee with confidence appeal TO the Senate and the
country to judge whether it made in honesty and
good faith, with view OF stating fairly what the
actual prices demanded for these vessels or with the
false and fraudulent purpose Of holding out TO the go
vernment and the country the idea that such vast
had been actually saved 10 the government by
the agency OF Mr.. Morgan.





Nor do the committee attach much weight TO the certi-
6cate Mr. Samuel L. Mitchl and several other gentle
men, who have given to the Secretary of the Navy
certificate that these vessels have been purchased at
lower prices than the vessels worth not than
the usual market prices at the tme but Sat lower prices
than have usually been paid by the government


Neither do your committee place especial confidence In
the judgment and opinion OF Mr. Samuel L. Mtchi in this
matter when appears from the report OF the Secretary
Of the Navy that than four hundred thousand dol
(s4O0 0O0 Of tho amount disbursed by Mr. Morgan
was paid to the firm Of s. L. Mitchll Son. Of which Mr.
samuel L. Mtch Is supposed TO be the senior partner


TESTIMONY MERCHANTS.


Nor Is II the fact, far as your committee upon
dgent inquiry have been able 10 learn, that such
arrangement that made by the Secretary Of the Navy
with Mr. Morgan has the sanction OF the Chamber OF
Commerce, Of any other mercantile community on
the face Of the earth. And 1t would be strange
indeed II were No usage prevail
be established among any intelligent and upright
community that does not rest upon the solid basis Of
common sense, common honesty and sagacity. Your
committee believing that merchant in possession OF
his ordinary mental faculties could be guilty Of the alb
surdity Of employing agent 10 buy for him vessel