This excerpt is taken from the famous Holt-Owen Report (the Commission on Ordnance and Ordnance Stores Report) of 1862, one of the most important arms-related documents of the Civil War.
Here we have sampled the correspondence and negotiations between the Commission and the Starr Arms Company. A reprint of the entire report (more than 600 pages!) can be found in our book Civil War Arms Makers and Their Contracts.
Statement of facts connected with the existing relations between the government, as principal, and the Starr Arms Company, as contractors.
Previous to August last the Starr Arms Company has been for two years employed in the necessary preparations for the manufacture of arms. On the 31st of that month it accepted a contract for 12,000 pistols, upon the faith of which additions and extensions were made to its manufacturing capacity, which enabled it, in November last, to accept an offer of a contract for 8,000 in addition. In that month, and a few days thereafter, it was offered, and it accepted, a contract for 10,000 breech-loading carbines. Immediately upon the acceptance of this contract the necessary preparations were immediately commenced, and they have been continued unabated, and are now almost wholly completed. Very soon after, to wit, on the 14th of December last, a contract for muskets was offered to the company, and on the 24th of that month it was accepted; the additional necessary preparations for its execution were added to those required for the carbine contract.
The unusual demand for gun-makers and gun machinery caused much delay in obtaining the requisite machinery, and a large appreciation in its price. The erection of the necessary buildings was commenced immediately, and their completion accomplished through storm and frost, at any cost, at any hazard, and in a period almost unprecedentedly short; meantime, an uninterrupted intercourse was kept up with the machine shops throughout New England which had been employed to build gun machinery. These machine shops were kept at work day and night, and every effort was made and inducement offered to effect the prompt completion of the machines. When, at your request the treasurer first, and afterwards the president, of the Starr Arms Company appeared before your commission, they responded willingly and frankly to your inquiries. From them you have the then existing facts in detail relating to the extent, cost, and classification of the preparations made. As necessary increase to the facilities for making pistols had been made before the carbine or musket contracts were taken, the energy of the company was directed to the important work of preparing for making carbines and the additional buildings and machinery for making muskets. These preparations consist of an immense building filled with new and suitable machinery, giving employment to many hundred men, who, at great expense, have been collected to operate it; of a very large stock of materials in hand and large orders for steel from England; of many thousand carbines and muskets in various stages of completion, and several thousand carbines almost completed.
The armory at Binghamton is employed exclusively in the manufacture of pistols; that at Yonkers in carbines and muskets. The extent of the latter is only exceeded by the Colt establishment, at Hartford.
The extraordinary exertions that have been made, the increased cost of the machinery and manufacture and manufacture by reason of the unexampled demand for gun machines and gun-makers, were based upon the conditions of the contract under which and upon faith of which the whole enterprise has been prosecuted, and it would not have been attempted or justified under less favorable conditions. Both wages and machinery are almost, and in some cases quite, double the current rates of a year ago. The deliveries of pistols have been quite up to the letter of the existing agreement; the spirit of the carbine contract has not been violated, although the right to deliver, as far as deliveries are due, has been technically forfeited. The first delivery under the musket contract will be due in July, and the guns will be ready.
You can but imperfectly judge of the surprise, embarrassment, and distrust occasioned by the action of the government in declining to receive the pistols – inspected, boxed, and ready to be shipped, in response to requisitions in the hands of the inspecting officer, Major Whitely – amounting in value to about $40,000.
The Starr Arms Company has built, equipped, and put into operation one of the largest armories in this country, upon an abiding faith. The company is up to the spirit, if not the letter, in all its undertakings – time quality, and quantity.
At my last interview with your commission it was suggested to me that the contracts accepted by the Starr Arms Company were without the form and authority of law. Certainly it cannot be your wish or the intention of the government to destroy at a blow the just expectations of those parties who have invested their whole property in the business. Should that company suffer by reason of any irregularity on the part of the government, and be ruined by a technicality? If the government has acted without the authority of the law, should it, can it, equitably avail itself of such unlawful act?
The conclusions to which the company has arrived are, that the government cannot equitably, and will not wrongfully, destroy or abridge its rights and just expectations. The company therefore asks that the existing hindrances to the delivery of its arms be removed, and that the spirit of their contracts be recognized by the government now, as it was recognized when and at the time of the acceptance of them by the company.
Office of the Starr Arms Company
New York, April 17, 1862
GENTLEMEN: It now occurs to me that in consequence of being interrupted when before you the other day, a statement was not given of all the machinery purchased for the special purpose of manufacturing the Springfield rifle, under our contract for 50,000 guns.
In addition to the machinery then enumerated, we have actually purchased twelve edging machines, fourteen drill presses, and four screw machines – one-half of which are intended for the Springfield rifle – and also six trip-hammers and five forging drops; all of which are now in the factory, and half of them for the Springfield gun work.
There are also thirty lathes now in the factory, one-half of which are for the above work.
We have now running a steam-engine large enough to do all the carbine and pistol work, but not the rifle work; and we have under contract, which we are obliged to take, a steam-engine and boilers of 200 horse power, with pulleys and shafting, costing altogether $12,000. The shafting and part of the pulleys are now in the factory.
The above comprises all the large purchases of machinery made for rifle contract; but there are many small things, amounting in the aggregate to a considerable sum, which should be added.
President of Starr Arms Company
Commissioners of Ordnance
Before commission, April 10, 1862.
Mr. E. Clapp, treasurer of the Starr Fire-arms Company, came before the commission, and states: We have a contract for 50,000 Springfield muskets. Cannot answer as to the details of the work, but we propose making the whole arm except the rough barrel. A full set of stocking machines has been ordered by us. Do not know when due to us, or where deliverable not less than 500 in October, November, December, each, and not less than 1,000 monthly thereafter, until June, 1862. This order was increased, January 11, by 8,000, deliverable in equal monthly installments from March to September, 1862. We were not ready to deliver in October, but we sold to Major Hagner, in New York, 500, navy size, at $20, in that month. We also sold, in like manner, 250, navy size, in November, and in the same month we sold 250, navy size, to the agent of Ohio. We have delivered and received certificates for 1,000, army size, in January; 600, army size, in February; 1,400, army size, in March, and we notified the department that we had 1,000 ready for inspection March 28 or 29. The department immediately sent inspectors, who are now at work. We think our pistols cost, to make, double as much as Colt’s. Our company has paid Mr. Starr $200,000 for his patents for carbines and pistols, and $90,000 additional for perfecting the pistol. I think Mr. Wolcott, the president of the company, told me that the cost of making our pistol was between $14 and $15. We had only made one thousand for the government in 1858, and five hundred for the trade prior to the receipt of our contract, and we have spent $100,000 since in pistol machinery and on our factory. We think our clear profit on each pistol does not exceed $5. When we proposed to make 20,000 at $23, we required eight months longer to deliver; with this time for deliveries, we would have no extras to pay for working at night. We made no proposition to reduce the price of our pistols to $20, nor was it asked of us. We are now turning out regularly two thousand per month. We make our pistols at Binghamton – working all night. This we have done since October, 1861. We expect to fill our whole order in August, and we will start as soon as we can an additional force at Yonkers on the work.
We have also an order for ten thousand breech-loading carbines, deliveries to be made – 500 in February, 500 in March, and 1,000 per month thereafter; price, $29 each. No deliveries yet made; 1,500 due at the end of this month. An extension of our time for delivery of our carbines has been asked for, but not yet granted. We asked an extension of Mr. Cameron, and we have a letter from him acknowledging the receipt of our request, and stating that he told me that it was not worth while to change our contract, as, if proceeded with in good faith, the time of delivery would be extended. This letter is here offered. We have now in hand six hundred, which we expect to deliver in May. The barrels we have made out. We have spent $140,000 on factory stock and machinery for this work alone. We have nearly all the stock for the work on hand, and the remainder is all ordered. we are perfectly willing to reduce the numbers by the amount of monthly failures; but having gone on in good faith upon Mr. Cameron’s promise, made immediately after Mr. Starr signed the proposal in my name, the loss of the whole contract would be unjust and unreasonably oppressive to us.
Before commission, April 15, 1862.
Mr. Wolcott, president of the Starr Arms Company, states: We propose to make the whole Springfield gun, including the barrel. We will make barrels from steel rods. We have our building at Yonkers, and we are getting our machinery for this work. We have one full set of barrel machines, which we are using on the carbines ordered of us. We have ordered another full set from Hewes & Phillips, of Newark, New Jersey. We expect them to be done within four months. We have stipulated to take this one set. They have also agreed to furnish us as many more sets as we need.
We have agreed with Lysander Wright, of Newark, for a full set of stocking machines. He has made some machines – not a full set, I think – which we had the option to take, but did not, as we were not ready for them, and he promised to get ours up in time for us. We have no written contract with him, and his making them is dependent upon our future order to him. Wright is just finishing a set of stocking machines for carbines for us which we are obliged to take. This set, I think, includes four machines, not more, and turns out the work so that it requires more hand work than the Springfield musket machines ought to do.
Nothing done in preparation for our mountings , bayonets, or ramrods. We have contracted for 130 milling machines; seventy of these are for the musket, and we shall use sixty for the carbines. Twenty of this 130 are already delivered, and forty more are to be delivered before the 1st of May, and the remainder during the first two weeks of May. We are getting forty of these from Parker, Snow, Brooks & Co., twenty from the Fishkill Landing Company, and fifty from Putnam Machine Company. The twenty now in shop are part of those by Parker, Snow, Brooks & Co. We have only a few cases of steel suitable for muskets, but we expect to get shapes from England. We have made no bargain for these. We can get a supply in sixty days from date of order in New York. We have done nothing for stocks; we can get some in New York for starting. I think that the Springfield arm, when inspected, will have cost us at least $17, including interest on investment, wear and tear, &c. I judge this from my own experience, and I think it holds good if 50,000 are made. Should the order of carbines be filled, we could turn all our stock, machinery, &c., to work upon the muskets without important loss. We are arms makers, have all our capital so engaged, and expect to continue in the business, having been at it now for three years. We therefore must seek this kind of work, even if the government do not employ us.
We have feared we could not make all our own work in time for the early deliveries, and we have therefore been in correspondence with others to give us about or under 5,000 sets of parts, to enable us to carry out the stipulations as to the deliveries. R.S. Stenton, 229 Pearl street, New York, states that he can furnish the musket complete (1,000 per month) ready to assemble July 1. Mr. Redfield, 177 Broadway, has offered to furnish any number of stocks; says he has a full suit of machinery, and is now turning out stocks. I know nothing myself of either party, but I have talked with Mr. Sackett, and his agent, the partner of Mr. Stenton, and, from his representations, I suppose they must be prepared to do as promised. Their work is said to be done at Rathway and Newark. We have had many propositions from other contractors to furnish guns or parts, but we have uniformly rejected them. We find that up to this time our pistols have cost us to make – say 5,000 in all – about $30 each, including a fair interest on investment and the wear and tear of machinery.
Decision – Starr Arms Company
Commission on Ordnance and Ordnance Stores
Washington, May 6, 1862.
General: The commission have the honor to report as follows:
CASE No. 69.
Starr Arms Company, New York
First order Sept. 23, 1861; page 200, Ex. Doc., No, 67.
To deliver 12,000 revolvers, of the Starr Company army pattern, at $25 each; 500 in October, November, and December each, and 1,000 monthly thereafter.
Second order Nov. 27, 1861; p.186 Ex. Doc., No. 67.
To deliver 10,000 breech-loading carbines, of the Starr Company pattern, at $29; 500 in February, 500 in March, and 1,000 monthly thereafter – completing the order before December 31, 1862.
Third order Dec. 24, 1861; page 159, Ex. Doc., No. 67.
To deliver 50,000 rifle muskets, Springfield pattern, at $20 each, as follows: 1,000 monthly in July, August, and September, 1862; 2,000 monthly in October and November, 1862; 3,000 in December, 1862; and 4,000 monthly thereafter.
Forth order January 11, 1862.
To extend order of September 23 for 12,000 revolvers to 20,000, upon the same terms and conditions, provided that the whole numbers be delivered within the time stipulated –
September 23, 1861
The terms of the orders for pistols and carbines declare total forfeiture for failure in any stipulated delivery; the forfeiture is limited to the monthly delivery due in the order for muskets.
The commission find that no deliveries of carbines have been yet made, and none can be made prior to July; and that, although 5,000 of the pistols have been inspected and received, the early deliveries were not made as stipulated; hence, under the provisions above stated, the obligations upon the government to receive 12,000 pistols, 10,000 carbines, and probably several thousands of the muskets would be canceled.
As the parties are regular manufacturers of arms, have invested a very large capital in the business, and erected extensive buildings and machinery, and as their failures in time cannot be ascribed to a lack of zeal, or to intentional neglect, the commission deem it proper not to enforce measures likely to injure their manufacturing ability; but, as the price of the revolvers is unreasonably high, compared with the arms furnished by other manufacturers, and as the retention of so large an order as that for muskets must increase the delay and uncertainty in complying with the terms of the others, the commission considered it incumbent upon the company to make a proposition corrective of these objections. Mr. Wolcott, the president of the company, has appeared before the commission, and has offered to relinquish entirely the order for the 50,000 muskets, and to reduce the price upon the remaining 15,000 pistols to $20 each, provided the orders for pistols and that for carbines be confirmed by the commission; and they also request that increased time by allowed for the deliveries; and that forfeiture for failure to deliver extend only to the monthly delivery due – promising to complete the work as soon as possible.
As the rates of delivery originally promised made work by night necessary, and thus increased the cost of production; and as the condition of total forfeiture for failure in amount or in time of a monthly delivery must also add to the manufacturer’s risk and expenses, the commission consider that, in the case of so well established a company as this and the present extent of our supplies, the promise to deliver “as rapidly as possible” will probably secure the full product of their factory without rigorous stipulation. It is therefore directed that the order of December 24 to furnish 50,000 muskets be considered revoked and annulled; that a number not exceeding 15,000 revolvers and 10,000 carbines be received under the terms and conditions of the orders given November 27, 1861, and January 16, 1862, at the rate of $20 for each revolver, with appendages, and $29 for each carbine, with appendages, that may be accepted upon inspection; provided that not less than 1,200 revolvers be furnished monthly, commencing in June next, and 1,000 carbines be furnished monthly, commencing in July.
The commission have considered it proper, under the circumstances, to authorize the prices as above for each of those arms as may be delivered as stipulated, although they regard them as unreasonably high for service arms.
Should the company fail to deliver the above numbers of either arm in any month, the total number remaining to be delivered of that kind must be reduced to the full extent of the number due for that month.
It is further directed that a sample carbine, satisfactory to the Ordnance department, shall be furnished prior to June 1, 1862.
We are, sir, very respectfully, your obedient servants,
ROBERT DALE OWEN,
P. V. HAGNER
Major of Ordnance, Assistant to Commission