has been ascertained to be largely in excess of the public wants, and the prices fixed by many of them beyond necessity or reason.

The unexampled demand for arms consequent upon the sudden breaking out of the present gigantic rebellion, and the extraordinary circumstances under which the Government arsenals were drained of their best weapons before a blew struck, afford some explanation of the excess of price referred to; yet, it must be confessed, not by any means a full and satisfactory one. It is to be traced, in a large degree, to a neglect of those common precautions which prudent men of business exercise in the conduct of their private affairs, some of which, too, had been specially provided for and required by acts of Congress.

First, as to foreign arms,it was of course absolutely necessary to resort to these in equipping, within a few months, more than half a million of men, and it was impossible, in all the workshops of Europe, to have had arms manufactured as rapidly as our public necessities required. Under such circumstances price naturally rose, and inferior (often second-hand) arms had to some extent to be purchased.

But these difficulties were greatly aggravated by the lack of system which prevailed. The States and the General Government entered the market together as rival purchasers, and thus the members of the same national family bid directly against each other. The folly of this is the more remarkable when it is remembered that these arms bought by the States were, in fact, for the use of the General Government, and will, no doubt, in the end be paid for by it. The General Government itself employed, directly or indirectly, numerous agents not acting in unison, and often becoming, therefore, competitors of each other. A few of these made purchases directly for the Government; the greater number sprang up in the shape of "middlemen," to whom, though not dealers in arms nor skilled in their value, contracts were awarded upon their own terms, only to be sublet to the actual importers. Under a system so ill considered, extravagance was unavoidable. It was greatly increased by many of these contracts being loosely worded and imperfectly guarded, while some were granted at prices much beyond the highest rates which could be fairly considered as engendered by the system itself.

Two examples may here be given in illustration: In the first - that of a large contract granted to a "middleman," who had never dealt in arms and knew nothing of their value - the reduction, partly in price and partly in quantity, effected by the action of the commission, amounted to $580,000. In the second, granted to a bona fide importer - being a contract of immense amount, namely,for upward of 188,000 guns and 38,000 sabers - the reduction in price alone, as compared with the rates paid under the contract up to the time of our decision, exceeded $1,000,000. In both examples the reductions were ordered under proposals finally made by the parties themselves after repeated conferences with them, and accepted by the commission. Other large contracts for foreign arms, of which the owners had incurred forfeiture by failure as to times of delivery, were rescinded by the commission.

Yet, withal, it has been impossible for us to protect the Government against lamentable losses in these loose and irregular transactions. In regard to a considerable portion of these foreign arms, Government inspection was permitted in Europe before shipment, but so utterly inadequate and so incompetent was the force assigned to this duty that it became a mere empty form, devoid of all utility or protection.