reliability of these vessels was paramount.
Perhaps the most time-consuming task for Isherwood was arranging for the building of the engines he had designed for government service. With only a rudimentary bureaucratic organization and a small staff, the executive officers in the Navy Department enjoyed a variety of duties, of which a most significant one was dealing with private contractors. Isherwood, in charge of steam machinery for the Navy, became responsible for making all the contracts for the construction of this machinery, as well as for procuring the necessary supplies, tools, and spare parts. Navy Yards were able to build some of the machinery, but the larger work had to be let out to private marine engine builders, most of whom were located in New York, Boston, or Philadelphia. In order to deal directly and effectively with these private builders, Isherwood spent much of his time traveling up and down the Atlantic Coast, negotiating for the Navy’s machinery.
In contracting for machinery, Isherwood rarely relied on public advertisements for eliciting bids from contractors. Instead, he would announce that the government needed machinery of given specifications and would invite builders to state their quoted price for such equipment. Isherwood would, subsequently, send circular letters to engine builders throughout the country, asking them to contract for a pair of engines at a price based on the lowest estimate he had received. Since he would negotiate with any competent and reputable engine manufacturer, he often asked for contracts with builders who had declined to give him an initial estimate. That there were too few private companies to do all the work meant that Isherwood had to travel around the country trying to persuade engine manufacturers to take on extra business.
If his refusal to contract through open competitive bidding indicated favoritism, it was, nevertheless, a necessary practice. Machinery building was too important and too complicated to be trusted simply to the lowest bidder. To insure the best possible work, Isherwood had to limit his contracts to responsible builders and set a price where they could make a fair profit. Only by this procedure could he protect the quality of his machinery and discourage the horde of opportunists who plagued the government throughout the war with their impassioned and impractical offers to supply its needs.
The normal procedure after contracting with a private builder was for the government to make progress payments as the machinery moved towards completion. Since there was no contractual guarantee by the builder to achieve certain standards of performance, the government was not able to recover funds on machinery which later proved inadequate. Consequently, the only way the government could protect itself was to control the original specifications so rigorously that the contractor, in meeting them, would assure the reliability of the machinery. Isherwood thus prepared extremely elaborate and detailed specifications and drawings for builders, so that, as he expressed it, “there [was] not a bolt, a nut, or a screw left out.” In this way no misunderstanding could occur, and no builder could find a loophole.19
Typical of Isherwood’s negotiation procedure was a trip he took in August, 1861, to Philadelphia, New York, and Boston, in which he made arrangements with five of the largest and most experienced marine engine builders for the construction of 5 inclined steam engines. These engines were to be placed in paddle-wheel steamers built in the Philadelphia, New York, Charlestown, and Kittery Navy yards. In reporting about his trip to Welles, Isherwood took pride in having been able to make contracts for a building period 15 days shorter than that for similar engines previously built, and in setting a price 12 per cent less by weight or power.
Unfortunately, Isherwood usually had to give Welles less favorable news. Writing to him in February, 1862, the Engineer in Chief explained that work on the USS Roanoake, in process of conversion into an ironclad at the New York Navy Yard, had halted because he was unable to contract for a propeller shaft. All the private forges were taken up with other work, so that contractors had flatly refused to take on this necessary job.
Finally, Isherwood was able to persuade one builder to cast it in rough form, but when the unfinished shaft was taken to the government machine shop, Isherwood quickly discovered that the finished work could not be done there, since both the largest planer and lathe were inadequate for such a large piece of work and broke down when attempting it. The problem here was twofold; the Navy Department did not have sufficiently large tools to do the work, and private contractors, overwhelmed with both government and private construction, had neither room nor time to take on the work that the Navy yards were unable to handle.
Frequently, engine builders, greedy for profits or overly patriotic, took on Navy Department work they could not possibly handle. With their limited facilities they had to turn to other builders, subletting their contracts, which inevitably resulted in delays. The reputable firm of Pusey and Jones, in Wilmington, Delaware, contracted to do the machinery of the Juniata, promising to complete the work in 140 days. As they had no foundries and forges of their own, they had to sublet to another builder, resulting in a discouraging delay of 164 days more before the machinery could be delivered. Despite Isherwood’s care in negotiating, time and again he discovered these “responsible” builders solemnly engaging for work which they alone could not possibly perform. Out on the Mississippi River or off the Carolina coasts, the Union Navy would ultimately suffer from the lack of a vessel.
There was one problem over which neither the contractors nor the Navy Department had control, and which threatened to throw the entire ship- and machinery-building industry into chaos. During the war the price of gold, measured in United States dollars, fluctuated greatly, reflecting a lack of confidence in the financial stability of the Union. Gold rose in price, especially after the issue in 1862 of greenback paper currency, resulting in a greater depreciation in the value of the dollar. The natural concomitant was soaring costs, particularly for materials and labor. Builders who had made what first had appeared to be profitable contracts with the government suddenly found that they would not make their profit and might even take a serious loss if they received only the contracted price for their machinery. Desperately, they turned to the Navy Department for extensions of time for construction, hoping also to avoid the penalty payments for delay which would further cut into their vanishing profits. Justifiably, they feared new contracts. The rate of inflation became so rapid that builders could no longer depend on short-term arrangements, let alone binding agreements for machinery which might take months to build.
Isherwood’s task became more difficult as inflation cut into contractors’ earnings. Writing to Assistant Secretary of the Navy Gustavus Fox, in August, 1862, the Engineer in Chief complained that he could get contracts for only two engines in Boston, because all the other builders objected to both the established price and the delivery date. Fearing that some of them might soon refuse to comply with contracts already signed, Isherwood explained that “prices of labor and material have risen enormously within a week.” Part of the rise in wages was because of the scarcity of labor. To this initial shortage of skilled workers came the complicating factor of the draft, which indiscriminately seized men who were far more valuable to the government by remaining in their civilian occupation. Isherwood begged Fox to obtain for such workers a draft exemption which he hoped would not only enlarge the labor force, but also lower wage costs, thus allowing builders to accept contracts and fulfill them on time. “Indeed, if it is not done,” warned the Engineer in Chief, “I am hopeless of the contracts already out being executed in any reasonable approximation to their time.”20
To get his contracts accepted, Isherwood often had to increase the government’s original price for machinery by 10 per cent and, in addition, extend completion dates for a month or two. “The most willing parties hesitate to accept,” reported the discouraged engineer in another letter to Fox, “nothing will induce them but a price under which they will be safe at the expected advance.” Because of the soaring labor costs, “common riveters for boiler work are now getting two dollars a day, and first-class workmen two and a half to three dollars. . . .”21
Throughout the nation, shipyard workers, conscious of the sudden rise in their value, demanded better pay. “At the Morgan Works the men have struck for higher wages,” Isherwood wrote to Fox, from New York
