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of tho rights of the States in their claims against the Federal Government in cases of this kind.

In this connection it should be understood that the reimbursement of California from the Federal Government on account of expenditures made during the Civil War for the maintenance of the national defense is not an isolated one. At least 25 States have presented their claims, had them allowed and paid, as indicated by the statement of the third auditor of the Treasury under date of March 15, 1892, covering Civil War allowances.

Since that time one State, at least, Nevada, whose case was quite similar to that of California, has been allowed and paid. A similar claim in behalf of Texas, covering expenditures from 1865 to 1877, was allowed by Congress.

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Recurring to the case of the State of New York above referred to, I quote excerpts from the opinion of the Supreme Court, as follows:

“The duty of suppressing armed rebellion, having for its object the overthrow of the National Government, was primarily upon that Government and not upon the several States composing the Union. New York came promptly to the assistance of the National Government by enrolling, subsisting, clothing, supplying, arming, equipping, paying, and transporting troops to be employed in putting down the rebellion.

“When New York had succeeded in raising 30,000 soldiers to be employed in suppressing the rebellion, the United States, well knowing that the national existence was imperiled, and that the earnest cooperation and continued support of the States were required in order to maintain the Union, solemnly declared by the act of 1861 that 'the costs, charges, and expenses properly incurred' by any State in raising troops to protect the authority of the Nation would be met by the General Government. “And to remove any possible doubt as to what expenditures of a State act would be so met, the act of 1862 declared that the act of 1861 should embrace expenses incurred before as well as after its approval. It would be a reflection upon the patriotic motives of Congress if we did not place a liberal interpretation upon those acts and give effect to what, we are not permitted to doubt, was intended by their passage.

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“Liberally interpreted, it is clear that the acts of July 27, 1861, and March 8, 1862, created on the part of the United States an obligation to indemnify the States for any costs, charges, and expenses properly incurred for the purposes expressed in the act of 1861, the title of which shows that its object was 'to indemnify the States for expenses incurred by them in defense of the United States.'

“So that the only inquiry is whether, within the fair meaning of the latter act, the words 'costs, charges, and expenses properly incurred included interest paid by the State of New York on moneys borrowed for the purpose of raising, subsisting, and supplying troops to be employed in suppressing the rebellion. We have no hesitation in answering this question in the affirmative. If that State was to give effective aid to the General Government in its struggle with the organized forces of rebellion, it could only do so by borrowing money sufficient to meet the emergency; for it had no money in its treasury that had not been specifically appropriated for the expenses of its own government. It could not have borrowed money any more than the General Government could have borrowed money without stipulating to pay such interest as was customary in the commercial world. Congress did not expect that any State would decline to borrow and await the collection of money raised by taxation before it moved to the support of the Nation. It expected that each loyal State would, as did New York (and as was done by California), respond at once in furtherance of the avowed purpose of Congress, by whatever force necessary, to maintain the rightful authority and existence of the National Government.

“We cannot doubt that the interest paid by the State on its bonds issued to raise money for the purposes expressed by Congress constituted a part of the costs, charges, and expenses properly incurred by it for those objects. Such interest, when paid, became a principal sum as between the State and the United States; that is, became a part of the aggregate sum properly paid by the State for the United States. The principal and interest so paid constitutes a debt from the United States to the State. It is as if the United States had itself borrowed the money through the agency of the State.

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So in conclusion, it may properly be said that the expenditures made by California, for which reimbursement is asked, were made in amounts that are unquestioned.

These expenditures were made for the sole and only purpose of aiding the Nation in its national defense. They were made at the suggestion and after conference with the highest military authorities of the Federal Government available to the authorities of California.

The expenditures made were necessary to establish and to maintain the military strength that was thus provided for the Federal Government.

The usefulness and importance of these expenditures and the value thereof in the common defense are not questioned.

In seeking reimbursement at this late day, California is asking only a degree of justice that has been accorded to many of her sister States in the past.

STATEMENT OF REPRESENTATIVE FLORENCE PRAG KAHN

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A comparison of the extra pay granted by the State of California to its volunteers through necessity and in order to do "an act of justice” to its soldiers as stated by the Army board above quoted in abnormal times and under abnormal working of the law of supply and demand in the remote possessions of the United States, with payments made by the Government to its soldiers in the World War, with conditions totally different from those prevailing in the remote possessions, colony, or province,” as California was denominated by Generals Wright and McDowell in the early sixties, makes the additional pay to the California Volunteers seem truly insignificant.

California is in need of the money due her from the United States for relief purposes. Repaying the State would make it unnecessary for her to apply further to the Reconstruction Finance Corporation for loans. The money advanced by California to the Federal Government was at a time when the Government was in dire distress and when it had all it could do to preserve the Union; and during those troublous times California substituted its credit temporarily, as was stated by Secretary Seward in his letter of October 14, 1861 (s. Rept. 351, 72d Cong., p. 10), for that of the United States and borrowed the money by the sale of bonds to meet the emergency. The State is still paying interest on $840,000 of the $2,800,000 of bonds issued in 1863 and 1864, amounting to $50,000 annually. Reimbursement of the State by the United States at this time when the finances of California are at a low ebb and large sums of money are immediately required for relief and unemployment purposes would be an acknowledgment on the part of the Government of the sacrifices California made in its behalf when substantial help was most needed in the sixties.

Representative Julius Kahn, of California, devoted a large part of his services in the House of Representatives in advocating the reimbursement of California for advancements of money made by the State to the Federal Government during the War between the States and introduced bills for that purpose. Unfortunately he did not live to see California reimbursed during his lifetime; but as the cause is just and meritorious, and as Congress has finally recognized the validity of the expenditures made by California on behalf of the United States by authorizing the payment of similar expenditures made by the State of Nevada, and as California needs the money due her more now than she did during the lifetime of Mr. Kahn, I urge this committee to submit a favorable report on Senator Johnson's bill, $. 1317, similar bills having passed the Senate seven times, including the Seventy-first and Seventy-second Congresses. STATEMENT OF CHARLES J. KAPPLER, ATTORNEY FOR THE STATE OF CALIFORNIA

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The payment to the Volunteers was absolutely necessary for two reasons: (1) Expenses of living and wages of labor in California were during the Civil War at least 50 percent, and in many cases 100 percent higher than on the Atlantic coast; (2) California was on a gold basis, and nothing but coin was in circulation. The United States paid the Volunteers in Treasury notes which did rot circulate nor were accepted as money in trade. The discount which the Volunteers were compelled to suffer in converting greenbacks into gold was, as stated by General Wright, the commanding general of the Pacific, more than 50 percent. (S.Rept. 351, 72d Cong., 1st sess., p. 16.)

The extra allowance granted the recruits and veterans by the State of California did not exceed the extra compensation and allowances which the United States had theretofore paid the officers and enlisted soldiers stationed on the Pacific coast between the dates of the acquisition of California and the breaking out of the Civil War. Certainly the necessity and the justness of such extra compensation was much greater in war than in peace, and as a matter of fact, it was imperative in that far-off “Colony or Province of the United States”, as California was described by Army officers serving in the Military Department of the Pacific.

The California Volunteers rendered most valuable and important service to the Government. They took the places of the regular troops in California, all of which, except three batteries of Artillery and one regiment of Infantry, were withdrawn to the east at an early period after the outbreak of the war. Without them the overland mail and emigrant routes, extending from the Missouri River via Great Salt Lake City to California and Oregon, and passing through an uninhabited and mountainous country infested with hostile Indians could not have been adequately protected; and yet it was of the first importance to have these routes kept open and safe, especially as enemy cruisers had made the sea routes both hazardous and expensive. Two expeditions composed of California Volunteers, under the command of Brig. Gens. James H. Carleton and Patrick E. Connor, respectively, performed perilous and exhausting marches across a desert and over an almost impassable country.” (S.Rept. 351, p. 26.)

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General Alvord on March 6, 1863, reported to The Adjutant General at Washington:

“California has sent troops to Arizona, New Mexico, Nevada, Utah, Idaho, Oregon, and her Volunteers have recently achieved a brilliant victory over the Indians on the soil of Washington Territory.”.

California volunteers also served in Colorado and Montana against the Sioux and Arapahoes.

It is clear the United States commanding generals of the Department of the Pacific advised, urged, and approved the enactment of relief measures by the California Legislature as necessary and proper, and that said commanding generals were instructed by the Secretary of War to use their best judgment in the common defense by reason of the fact that they were 3,000 miles from the seat of government at Washington, with communication (there being no railroads) slow, infrequent, and often interrupted by hostile Indians.

AGENCY

Every act of California in placing the State in position of defense and passing necessary relief measures for her volunteers on account of the abnormal conditions prevailing was done by the State as the agent of the United States, with the full knowledge, consent and cooperation of the commanding generals of the Department of the Pacific, its representatives, and with the knowledge of the Government at Washington.

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The act of 1882 (24 Stat. 217) required a report from the Secretary of War as to the necessity for and the reasonableness of the expenses incurred.

The Secretary of War and the board of Army officers in examining and auditing the expenditures made by the State of California found that as a matter of fact the expenditures as made were, on account of the abnormal conditions prevailing, necessary, and that such expenditures were economical and reasonable; and further stated that “the proof of the fact that the money was actually expended and honestly disbursed by the State is satisfactory.".

Under the provisions of the above act of 1882, the State of Texas, among other States, was reimbursed the sum of $1,175,793.37.

The report of the Committee on Military Affairs on the bill resulting in the act of 1882 (S.Rept. 575, 47th Cong., 1st sess.), stated that the expenses for which the State of Texas claims reimbursement were incurred by the authorities thereof under its laws and for the proper defense of the frontiers of said State against the

attacks of numerous bands of Indians and Mexican marauders between October 14, 1865, and August 31, 1877. These claims had been the subject matter of much correspondence between the State authorities of Texas and the officials of the United States, and had several times received the partial consideration of both branches of Congress. Under the act of 1882 the Secretary of War, with the aid of the Army board appointed under the act of 1886, duly examined, audited, and stated the State war claims of Texas, and of the sums as audited Congress appropriated the sum of $927,177.40 in the act approved March 30, 1888 (25 Stat. 71), and the sum of $148,615.97 in the deficiency appropriation act approved September 30, 1890 (26 Stat. 539).

No one doubts but that all said war claims of Texas so examined and audited by the Secretary of War, aided by the Army board (the same Army board which examined and audited the war expenditures of California) were valid and proper charges against, and should have been paid by, the United States as audited, but they were not paid without great delay and only after continuous and hard work on the part of Senator Maxey and Congressmen S. W. Lanham, Roger Q. Mills, and J. D. Sayers, of Texas, to overcome objections. In order to show the difficulties encountered by Texas (the same as were and are encountered by California) Congressman Mills, on March 17, 1888, stated to the House of Representatives:

This (claim) is an old, familiar friend of mine, I am thoroughly acquainted with it in all of its details. I introduced bills, as did my colleagues upon this floor, years ago to pay the State of Texas the money which had been expended by that State in doing that which the Government of the United States ought to have done for her. I remember the time when the Representatives from Kansas, Nevada, California, and Nebraska and ourselves, often met together for conference and with a view to helping each other to get the Congress of the United States to do justice to our people in recognizing these claims, which had been standing so long.

“We united our efforts and aided in the passage of the law of 1882. That law was passed for the purpose of providing a settlement for these claims, and under it all of the claims were submitted, with the evidence to substantiate them, to a board of Army officers. They have been thoroughly, patiently, exhaustively examined through a careful process of inspection covering a long period of time, and have all been reported to Congress.

“There is no objection made to the payment of any of this class of claims upon the judgment of this board of Army officers, endorsed as it has been by the Treasury Department, except with regard to the claim of Texas; and the opposition, Mr. Chairman, is as unjust to the State of Texas as it would have been to the other States.

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But, sir, this appeal that has been made here is all for delay. They say the case ought to have waited longer—as if it had not waited long enough alreadyand that it should have gone through some further and more patient examination; but they have not been able to point to a single item of all the items making up this sum of $927,000, which is not justly due to my State-not one of them.

Our claim is a little larger than the claim of the State of Kansas, because Kansas had a much smaller frontier, and had to guard only against the Indians, whereas we had both the Indians and the Mexicans. We had a border as long on the northern frontier of the State as the whole frontier line of the State of Kansas, and in addition to that we had all of that vast line from the thirty-second parallel of north latitude down to the Gulf of Mexico, making more than a thousand miles in addition. That is the reason why the claim of the State of Texas is larger” (Congressionol Record, Mar. 17, 1888, p. 2265).

As showing that the result of the examination and audit made by the Secretary of War and the board of Army officers were carefully made and arrived at, Congressman Sayers, of Texas, stated that the computations made in the Texas case were almost absolutely perfect, an error of only $64.50 occurring in an allowance of $927,177.

The same Secretary and the same Army board passed upon the expenditures as made by the State of California after a thorough, patient, careful, and exhaustive examination and audit. The Secretary of War and the Army board have certified in an official itemized statement of account as the result of such computation the true amount that should be paid by the United States to the State of California on account of the moneys it expended as “costs, charges, and expenses” to aid the United States to maintain the common defense on the Pacific coast during the Civil War, and the Comptroller General has certified such amount as was found

due to Congress, same appearing in Senate Report No. 351, Seventy-second Congress, pages 4 and 5.

In line with the arguments made by Congressmen Mills and Sayers in the Texas case, as above quoted, and as supporting California's contention that its expenditures on behalf of the United States have been thoroughly and carefully examined by the Secretary of War, the Army board, and the committees of both Houses of Congress, and found to be proper expenditures, the following is quoted from the Congressional Record when the California reimbursement item was placed in the omnibus claims bill in the Fifty-fifth Congress, second session:

"Senator TELLER (chairman and having bill in charge). These claims have had the attention of the Senate and I will just read a moment, taking the claims of California, Oregon, and Nevada. Favorable reports in the Senate

were made in the Fiftieth, Fifty-first, Fifty-second, Fifty-third, and Fifty-fourth Congresses, and in the House in the Fiftieth, Fifty-first, Fifty-second, and Fifty-third Congresses. They cannot have any more attention than they have had.”

“Senator HALĐ of Maine. As I understand it, the Senator's committee has spent days and nights upon these matters, has examined them carefully, and has given a kind of judicial scrutiny to the claims. I do not suppose he or any of us would say that the bill is perfect, but to me it is the best solution of all the claims which have been accumulating and damming up here for years and years, and which ought to be paid. I do not believe we will ever get a tribunal in any way to give claims better scrutiny and bring out a better result than has been brought out by the Senator from Colorado and his committee.” (Cong. Rec., vol. 31, pt. 6, p. 5690, 55th Cong., 2d sess., June 9, 1898.)

When the conference report was presented to the Senate on February 28, 1899, the following debate took place:

“Senator PERKINS of California. I desire to ask the Senator from Colorado concerning the claim of the State of California for supplies furnished troops and manning and equipping them during the Civil War from 1861 to 1865, amounting to some $3,900,000, which has been favorably reported upon during five different Congresses and which was placed upon this omnibus claims bill, so-called, unanimously by the Senate. Did the conferees on the part of the Senate recede from that amendment, and, if so, what is its status today? I incidentally learned that the claim of the State of Nevada has been referred to the Secretary of the Treasury for report. If the committee desires further light upon the California claim, we are willing again to place it under the Roentgen rays of investigation, but really I do not want to wait as long as the French spoliation claims have waited to have them adjudicated.

“Senator TELLER. I will say to the Senator that I have examined the California case. As he states, it has had a most thorough examination at the hands of the committees of both Houses and I do not believe that it needs any further examination. It is one of those claims that ought to be paid. I want to say to the Senator, that even the conferees on the part of the House were not unfriendly to his claim, but they felt that we were getting too big a bill. That is the plain English.

„EGISLATURE OF CALIFORNIA AUTHORIZED EXPENDITURES

All California's war expenditures were expressly authorized by acts of the State legislature, induced thereto by urgent calls for troops from the Federal Government, and were incurred directly on account of the abnormal conditions prevailing which made such expenditures absolutely necessary in the common defense, and such acts had as before stated, the approval and recommendation of the commanding generals of the United States who reported same to the authorities at Washington. It may be safely taken for granted that the State legislature composed of men who had come to California from nearly all States in the Union and the Governor of California would not have passed and approved acts, por would the commanding general of the Pacific, representing the Government, have recommended such acts, appropriating large sums of money which were not necessary and proper in the common defense, especially as at that time the State's treasury was depleted and she had to issue and sell bonds at a large discount and pay high rates of interest, as well as heavily tax her citizens, to raise the funds to pay such expenses

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