Indiana State sentinel. [volume] (Indianapolis) 1841-1853, 1851-01-23
Veto Message of Governor Wright, of the Bill
in relation to the Terre Haute and Richmond
Railroad, sc.


GsatIsmsa Of the House Of Representatives.
Herewith return you the bill Of your House, No.
H. being authorizing the Terre Hante and Rich
mohd Railroad Company TO issue bonds, &C. with my
reasons Tor Withholding my signature.
This bill authorizes the company to issue bonds TO sell
the within of this State bear any rate Of
interest per and TO sell the al such rates
and Tor such prices may be agreed and that such
sales, though made at discount, shall be valid as
If sold par There Is IN this company county stock
There is not Railroad in progress in this state,
which there is not either county city stock This
work important IL part OF OF the great
rhorouehares of the State: it IS managed by the most
prudent in the country who have embarked large
OF their capital the enterprise and who de-
receive the aid OF the Legislature and nothing
but sense OF duty compels me to return THIS Dill Tor
your reconsideration During the last session, short
lime after the commencement OF my duties the same
question was presented TO took occasion then, IN
special message offer some suggestions Time has
only served to convince OF the correctness OF the
opinions then advanced. and take this opportunity
the investigation OF this subject TO refer you TO por
ton of views then offered, with such additional
ghments as my time will allow me TO lay before you.
Irrespective OF the question the proprety Of
ties and cities their corporate capacity subscribing to
the stock of such works it Is clear that when such sub
scrptOns made, the interest which the counties and
cities hold should suroundeds by safeguards of the
unquestOnable security From this consideration alone
submitted that il would be improper invest the direc
tory of any company with unlimited power to sell bonds
any of discount they may please to make, and
TO cause them to bear any of interest however
orbtant. Is il the duty of the law making power
70 protect The taxpayers OF the Subscribing counties
from encroachment, especially when the lrreyocabe
character of such bonds IS considered!
But this objection the unlimited rate OF interest and
discount is greatly strengthened by consideration oil
the number Of enterprises oil this character this
and the adjoining States and the probable effect OF their
prosecution upon our financial condition Facts OF re-
cent occurrence fail of instruction this subject.
The lesson that similar state of things taught the peo-
pie Of the old world, trust are not forgotten There
these enterprises have already received check
and it would that the spirit OF speculation has
been transferred from that field OF OPERATION great
measure to this country. Here, similar scenes now
being enacted, to the same extent may be- but
unless prudent foresight nterpose Its saluary check
there ground for the apprehension that results equal
~ disastrous will here We advised that one oil
the first mOneyed houses OF the old world has lately
tablished bransh in great commercial metropolis,
thus preparing for action regarding this as the peculiar
field for such operation and from the very fact that it
becomes necessary now, in view Of the interest of GER
companies in the prosecution Of these works. to ask
leave pay higher Of interest than usual and to
sell their bonds whatever amount they may agree to
receive evidence OF strong pressure, otherwise
action this branch oil enterprise Indiana has had
such lesson the sub Of the prosecution OF works
OF similar character, that shall be justly chargea
bic with want of prudence, ii fall again into like
difficulty without having made exerons TO avoid
the disaster If the moneyed operations OF these compa
confined the ordinary and sale methods OF con-
Quoting business if large debts not contracted, at
heavy rates Of interest," at uinous discount then in
would be a suspension Of the work
But consider what would be the effect, If by gener
al monetary reyulsOn such work should be arrested,
while in the midst Of its active operations, II burthened
with the obligation pay heavy rates oil interest, and
the time, with part OF the work so lar finish
ed, be susceptible of producing revenue. Extend
this example the whole State, and what would we
see but the materials of these works brought under the
hammer the bonds pledged to them disposed OF at fore
ed sales the CONSERVATION of the too cOndng
pants and the payers OF subscribing county grOan
paving the interest on stock which pays dividends
IL is said If limit is prescribed the sale of these
bonds the interest that they shall BEAR that sale
be made at any better rates or limits This is not
true II in the sale of the State bonds du-
ring the progress OF system oil Internal improve
ments. There invariably limit prescribed, to the
the bonds should bear and according TO the
ports OF the Fund Commissioners sales were made for
ers than the rates prescribed and in many instances
premium But with all the restrictions that could be
thrown around the sale Of bonds, the State suffered
greatly, and she will again lend her credit
become interested in any works of internal improve
ment.
We are now in the midst Of the second history of inter-
nal improvements in Indiana, in which involved
large amount of Corporation stock of Counties and
Cities.
It is matter Of but little difference whether the
State Counties, Individuals earring
prise if the fails out badly, il will equally
effect the whole community.
All are alike interested in the welfare and prosperity
Of the State; the adoption Of principle that liza
bic TO be abused and will work TO the injury of the one,
will inevitably affect the other
We have than million of County and City stock.
in the various Railroads Of the State and the prospect
IS, that the will be largely increased the coming
season.
Whenever il shall become necessary carry on these
works. that you have to place the credit of the cOmpa-
MES in the hands of the money lenders and the ndvdu-
al entrusted with the work. without limit restriction,
that moment you will PROSTATE the credit Of The
try. What will be the character of our State abroad
when Counties and Cities shall be driven in effect re-
pudiate their obligations and contractsf
When this takes place, you will find the dues of the
State placed in the same situation.
When a rate Of interest is established by law and
when with us the is high compared with CON-
mercal il is policy permit exceptions the
rules except in extreme cases and then there should be
a limit.
In the case under consideration it seems to me- that
public policy points plainly the enforcement of the
rule within given limit IL might be safe, and even
Desirable 10 permit the sale OF bonds somewhat less
than the par Of State Bonds, of the same rate Of
interest," but the experience of the State admonshes
that the discretion in such should have its limits
defined.
Ii remarkable fact that in every instance that has
come under my observation, where the power sought
to be given the directors OF companies to borrow
neY make sales Of Bonds, without limit rcsticton
that in the first instances Of Incorporation have been
passed by the Legislature, in which such power
IN said companies that subsequently amendments have
been made from time time, until this unlimited
power asked IL is suggested with preat Difference
whether the adding Of this power, would be viola.
ton OF the faith upon which the people Of the several
counties, in their corporate name, have heretofore
ken stock in the various companies OF the State.
II is said that the bill referred does authorize the
selling of the bonds OF the counties, the hypoheca
ting OF them any rate OF interest," that may be agreed
upon While this is, perhaps true it is difficult for me
perceive the difference between giving the power
Pressly in relation to the bonds Of Counties, making
the same unlimited power applicable alone to the stock
49, d. e H.. -.