Worcester daily spy. [volume] (Worcester [Mass.]) 1850-1888, 1871-01-06
FRIpAY, IANUARY 9, Isa1



The Pacific Railroad Bonds,
The bonds issued by the government in aid of
the Pacific railroads, have been distributed to
the several roads, as follows kansas Pacific,
SO SOB 900; Western Pacific, 81 $40, 900; Sioux
City and Pacific, 81 ,62s,S2O; Central Pacific,
S25, ss1 ,OOO Union Pacific, s27 ,236 512; Central
Branch, S1,6O0,0Oo. The Central Pacific and
Union Pacific roads were started as government
enterprises the others as private enterprises.
The whole amount Of bonds issued to the several
roads, is s64,61s,s92. The Union Pacific road
has done most business for the government,
halt the charges Tor which, credited towards
payment Of interest on the bonds, amounts to
81 ,434 952 the unpaid balance being S2,27S, AIS.
The Central Pacific has paid interest, in the same
way, TO the amount of SIZE, 480, leaving an un-
paid balance Of 5000, 1879, due to the govern
men1.
The Union Pacific and Central Pacific rail-
roads were built almost wholly through the I'M
settled wilderness. When they were proposed,
many intelligent and judicious persons, like
Senator Colamer, of Vermont, believed it i'm
possible to build and maintain them The
building Of a railroad across the continent was
q work which private enterprise could not be in
6uced to undertake. on its own account, But
the government wanted the road, and sought to
have it built without becoming itself a road
builder. 1t would give money and lands in aid
of the enterprise, or it would issue bonds and
take the risk of losing the amount advanced.
Finally, in 1864, parties were induced to come
forward and do what the government desired
70 have done. A contract was made with these
parties; and, on the side of the government, the
-fmp97tant article m this contract, was, that it
would issue these bonds to be used for building
the road, take q second mortgage, and
waive the payment of interest, beyond
tho amount of half the proceeds from gov
eminent business, when the road should be
finished, and five per cent. of the compansy net
receipts.
Why the government wanted the Pacific rail-
road is too manifest to need much explanation.
1t would open the central wilderness of the con-
tinent 10 settlement and givevalue to the public
lands. It would establish direct and rapid COM
munication between the Atlantic and Pacific
coasts. And it would greatly reduce the ex-
penses Of the government for transportation.
In the expenses of the government business
done by the Onion Pacific railroad, the saving
has been more than equal to the whole amount
of interest on the bonds issued to this road and
this saving began seven years earlier than was
promised in the contract 1t has been esti-
mated that the present cost of transporta-
iron over this road is scarcely one-fourth
of the cost by the Oil methods. As
the charges on government business, since the
road be an to do business, amount to 81, $780,
so4, the saving to the government amounts to
three times this sum, or SS,609,712. But, sup
pose the government saves only one half of the
cost by the old methods, and the saving, up TO
the time of the last settlement, will be $780,
994, which added to one half the charges on gov
eminent transportation, amounts to S4,aO4 $50,
which is 1851 ,4s5 more than the interest on the
bonds, up to that time. The government was
not mistaken in surprising it needed Pacific
railroad.
The Onion Pacific railroad company has
faithfully adhered to the terms of its contract
with the government 1t has even done better
than was promised, by finishing its road seven
years earlier than the time specified. The gov
N4i4AA-Hl lds NObt Nlldl IL J1OIulSCus duu lletG
wis no default on either side, until Secretary
Boutwell,, eager to get all the money possible
for the government, sought to repudate an i'm
portaut part of the contract, by means of
new and strange Interpretation of the law. No
ne who was in congress in 1864, can have for
often bow distinctly it was understood, that
company should not be required to pay in
the honda JIutiI fbav
beyond what we have specified. 1t was sup
posed that twelve years or more would pass
before the road would be finished, and as many
more, after the road should be finished, before
ITS business could be sufficiently developed 10
Place it in tolcra Jly easy circumstances. How
could it pay the interest regularly? The gov
ernment was willing to give money, if necessary.
/. meant 10 aid the work. Therefore, PROPOSE
ton to put the company under obligation to pay
the interest regularly, was deliberately voted
down; aud this part of the contract has never
been lied in question, at the treasury, until
now.
Mr.. Alderman says: 81 regard the Union Pa
cifc Railroad Company as substantially an act
OF bounty on the part Of the government"
This assumption was necessary to make his
''opinion' even plausible. nhehad said, the bulG-
ing OF the road as an act of bounty to the
government, he would have spoken more truly.
But there is no bounty in the case, The gov
eminent made q contract to render aid TO get
the road built. 1t should now be faithful to the
terms OF that contract. 1t cannot afford to have
the road destroyed, nor can it gain any
thing by misusing and running the men who
who were induced to build it.