Rutland weekly herald. [volume] (Rutland, Vt.) 1859-1877, 1873-01-09
THE RUTLAND HERALD.
WEDNESDAY, JANUARY 8, 1873.
The Credit mobilier of America.


templating thenecessities of q epeeoler IN
accommodation between the Atian.ic
and the Pacific, broaoned the ldea Oh
railroad across the unsettled portions OF
the west, girding the whole country,
from sea to sea, with parallel bands OF
iron. The idea was secuted as the idle
dream of a visionary brain. The men,
who had before derided even the thought
of locomotive, a steamboat and rail-
road for the same causes, still refused TO
believe that Yankee pluck aided by
Yankee skill and Yankee capital could
accomplish anything that was possible.
Time passed on, and the breaking out or
the rebellion demonstrated its necessity.
Steamers and overland stages were too
slow. The Pacific coast was practically
isolated from the country east OF the
Rocky Mountains, and even a Republic
of the Pacific was projected. Aside
from the necessity for travel and inter
communication, a railroad uniting the
two seas would form firm, indissoluble
bond of union. These views gradually
gained ground among thinking, shrewd,
patriotic, business men, and finally took
form in the charter, by Congress, of the
Union Pacific railroad. The first step
was taken, but millions upon millions of
capital were required. Government ex-
tended her aid, the capital of the COM
pany was expended and yet the laborers,
the engineers and artisans called for
more. How should this be raised was
the question to be met, and met at once.
Money must be forthcoming or the pro-
iect must be abandoned. Then it was
that the "Credit Mobilier' was organic
ed. What is the ''Credit A1obilier ?" is
a question often asked. 1t is somewhat
strange that an organization that accom-
plished the grandest achievement of the
age, that has played so important part
in American politics, has given rise to so
many newspaper and Congressional dis
cussions, and that has been nursery for
so many scandals, lawsuits and investi
cations has no published history. APP
pletou's Cyclopaodia, generally so full
and minute, has not, in either its first
or annual series, even a passing allusion
to the great organization that built and
equipped the Pacific railroad. The idea
was borrowed from Paris, where joint
stock company, under that name, was
established in November 1852, with a
capital of sixty million francs, for the
transaction of a general banking bust
ness and with the object of aiding in the
progress Of public works, of promoting
the development of national industry,
and of consolidating into q common
stock the shares and bonds of leading
companies. Its object was further and,
perhaps, better described by one of its
founders as being ''to play with respect
to the fixed capital employed in indus
try, part analogous to that which
banks of discount fill with respect to its
circulating capital" 1t was authorized
to purchase stocks, bonds and shares of
railways, canal, etc, and to issue its own
bonds to an amount equal to ten times
it's capital. Its most noted achievements
were the consolidation of the Paris gas
and omnibus companies and immense
operations in railways in Spain, Austria
and Russia as well as in France and
elsewhere. From France the same plan
of organization for building railways
and other works, was carried into other
countries of Europe, and there, also,
proved peCuniary success to the found
ers as well as beneficial to the public.
Having these organizations in view, a
charter was obtained from the Pennsyl-
vania Legislature and the ''Credit Mo
bilier of America" was organized, but at
first under another name, with Cakes
Ames and other persons prominent in
the construction of the Union Pacific
railroad as corporators and stockholders.
This was the organization that furnished
the capital that built the Pacific rail
road, in the same way that the capital is
furnished to build all railroads, by ener-
getic, shrewd far seeing capitalists and
contractors, whether they are voluntary
copartnerships or incorporated compan-
les. This is all there was of it. You
can call it the "Credit Mobtlier," an or
ganization, monopoly or ga ring" if
youplease, but the fact remains that with
out 1t the Union Pacific railroad would
not have been built for years to come,
and 1t was therefore a public benefit.
But 1t is said that they made large pro-
fits, declared large dividends, and that
Members of Congree were stockholders.
As to the profits and dividends, they
were entitled to them. They took the
risk and are entitled to the gain. 9th
ers would not invest, and, seeing the
profits ahead, they furnished the funds,
reaped, as they had the right to, large
rewards. As to the fact of Members of
Congress being stockholders, it, in and
of itself, is of no consequence, no more
than that they are stockholders in a
bank or marble quarry, and until it is
shown that the stock was SO held for
corrupt purposes, we hold it as q matter
of private and not public concern. We
do not propose to discuss the question,
here, whether such organizations, as a
general rule, are beneficial or not, or
whether this one was properly managed.
These matters are foreign, to our pres
ent purpose, which has been simply to
state Its origin, objects and one bene-
hcial result, and here, for the present
we propose to leave them.
FAILURE OF COMPETITIVE ExAMIxA-
TONS. Prominent officers of the Treas.
ury, who were early and eminently fav-
orable to civil service reform, state that
IN their judgment the present plan of
competitive examination is complete
failure. OF the seventy-odd appoint
ments made under it, the assertion i
made that not one of them would have
been selected as The best person for Tia
position to be filed According to ono
lnancl L. -