The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1857-01-23

than to be holding out this perpetual premium To-
Vena'ly IN our public men. If therefore, we see k
to give expansion to our Industrial and co.nmer-
cial interests-if we are DESTROYS of MAINTAINING
a name for political integrity and indenendence-
we VIII 90 away with this crying evil by intro.
ducjng into our tariff such notifications as com.
mon sense and our obvious interests demand.
The Railroad and Financial Condition nj ,n
| United States.
We are at present in most interesting and
curious condition fnancally such a condition,
probably, as neither this nor any other country
ever occupied before. The general expansion Of
the country may be set down in round figures at
two thousand five hundred millions, of which one
half is chargeable to the railroad system, one
twelfth to the States and the remaining FIVE
tweliths TO banks, insurance companies, loan and
trust corporations, canal companies and the like.
All OF this, however, is wound up together.
Some portion-though far less than the public
imagine, not over five hundred millions-of this
grand fictitious capital is held abroad, and we
pay, good year and bad year, thirty. five nllions
annually in the shape of interest thereon to the
foreign holders. The balance-two thousand
mnions-is held at home chiefly by the aid of
the banks and large capitalists, in whose hands
by far the greater portion of the paper securities
railroad bonds and stocks-are permaaently
pledged. Thus in one way or other, ether as
actual holders or as holders for advances, Ill the
members of the financial community are jpintly
and severally bound together for each othe, and
for the several classes Of securities which repre-
sent money and trade. ~bf
Curiosity to investigate the actual condition Of
so largely indebted and singularly entangld a
community may well be felt. But it cannot be
well gratifed. The reports of the Secretar, of
the Treasury do indeed show that the country is
in precarious position, and that without same
conservative measure, such as suspension ofthe
small note system, disaster must be expected.
And the reports on the finances Of such States as
have mingled in the general money manufacture
confirm the same view; urge the necessity of eau
ton, and confess in the frankest manner that
the enterprises in which they have engaged-rai-
roads, canals, and other works-have uniformly
fallen short of the expectation. But when we at
tempt to 60 to the core Of the system, ard to try
to find out what is really doing in that great
gate Indebtedness, we are stopped at the vey
threshold by statements, figures and reports which
no man living can understand. We repeat, there
does not live the man who can translate INTO
plain English the reports Of the great railways of
the United States They are incomprebensble.
Their accounts are a mystery. Their argum.nt.
are beyond the reach of the human mind. At
tempts to decipher them only complcate the
mystery and complete the bewilderment of the
reader. And all this we understand the more
readily when We are warned that they are not
intended to be understood
To the State Engineer of New York we arc
indebted for the first official light that has been
thrown on our railroad system. We have pc
cular satisfaction in remembering that the argu.
ments which that functionary brings to beas with
such force have been every one reiterated at va
rious times in the columns of the HERALD; now,
perhaps that they appear in an Official shape,
with the seal Of public Office on them, add with
all the authority which the high character aud
IMITATION of the State Engineer can bestow, the
liant them some attention and will
self against swindlers.
The ST. Engineer shows most unans .erably
that the general principle ON which the railroads
Of this State-with few exceptions-are managed
lie to borrow money to make up the deficiencies
in their cash box, charge the same to construction
account, and pay dividends which have not been
earned. He shows further that, from the slip
shod way In which most Of our roads have
been built the actual necessary expense TO keep
the track, bridges and 80 forth In repair from
year to year will exceed the sum which many
have paid every spring in the shape of divi-
dend and that hitherto this expense has been
Struggled out Of sight in one way or other.
When one aludes, in this State, 10 railroad
and fraud the public at once
points the finger at the New York Central.
Minor rogues may well hang their heads in
presence of the mammoth operators Of that
monstrous concern. But all follow the same
beaten track. When the Erie Railroad closcd its
construction account and ceased to borrow money
10 pay dividends, especially when IL had the
Irankness TO come before the public and admit
that during two years Of this policy of abnega-
lion, it had earned no money, there was mo-
nentary idea in certain quarters that we were
going 10 have an honest railroad company, and
he surprise was enormous But that delusion
has been dispeed by the application made by
he Erie company to the Legislature for leave TO
ssuc more stock. Because they cannot pay in
crest ON what they have, therefore they want to
Increase il.
All are in fact the same. mere followers in the
wake OF the Central. And IL IL be certain that
nan cannot 90 on forever borrowing money aud
ot repaying; printing falsehoods to hoolwink
be public, and declaring that out of ten dollars.
ne may pay twenty setting shocking example
{ fraud, delusion, aud roguery in the very high.
1t financial circles, then, most assaredly
tremendous crash Is ahead, and all who have to
O with the railroad world will 10 n, I.