Montgomery County sentinel. [volume] (Rockville, Md.) 1855-1974, 1873-03-07


have a condensed and plain statement Of facts
Of the commencement and organization Of the
Union Pacific and Mobiler Companies. That
we may more fully understand and compre-
bend the enormity Of that fraud, by which we
have been robbed OF millions of dollars and
millions Of acres Of public lands, and that, too,
by and for the benefit of the virtuous Puritans
OF Boston, submit the following history for
your consideration
The story Of the Credit Mobilier is some
what complicated, but by attending only to
salient points sufficiently intelligent comprs-
hension Of the great scandal which has invol-
we'd so many prominent men may be obtained
The facts are about the following In 1862,
during the late war, whilst nearly one-half of
the States were unrepresented in Congress. that
body passed an act incorporating the Union
Pacific Rail Road Company to construct
road from some point west of the one hun
dredth meridian of longitude in the then Ter
ritory of Nebraska, this point being after
wards settled upon as Omaha on the Missouri
River1 to the west boundary Of the Territory
OF Nevada To assist this enterprise the act
gave five alternate sections Of the public lands
on either side of the road, and loaned the Com
rany six per cent U S. bonds payable thirty
years after date, to the amount of SIG, 600 per
mile for track laid on level or prairie land:
| S32 900 on rolling or billy land, and SIS, 600
| per mile on mountainous land. These bonds
were to be delivered TO the Company, as sec
| tons Of forty miles were completed and put in
good running order, to the satisfaction Of the
| Government inspectors. And 1.-THE issue OF
said BOMBS and delivery to the Company shall
ipso tdct0 constitute first mortgage on the
whole line of the Railroad with the rolling
stock, fixtures, and property of every descrip-
ton" Furthermore all compensation rem
dered the Government by the road shall be
applied to the payment of said bonds and in
terest, until the whole is paid off Under these
conditions, of course the Company had no
money from the Government to commence
their operations on the road; the lands could
not be sold until the road made them accessi-
BILE; the bonds could not issue until 40 miles
OF road were completed and in running order
and they found it difficult TO procure subscri-
bers 10 The stock SO long as the Government
held first mortgage on the road, but by cor
rupt influences in Congress determined its
privileges, together with the millions of public
lands, should furnish the means
Under these circumstances an effort was
made to procure further aid from Congress,
and IN 1864 an act was passed by which the
Government gave up its first mortgage lien
aud accepted a second as security for the mo-
ney loaned the Company, and consented that
one-half Of the compensation rendered the Co
vernnent by the Company should be applied
to the payment of the bonds loaned This act
enabled the Company to sell their bonds, by
giving first mortgage as security TO the pur-
chaser, BY which they Were able to commence
and build the first 40 miles, which were TO lie
completed before they could draw the bonds
from the Government.
Atthis point the question Of the building of
the road came up, and some of the shrewder of
the stockholders determined TO get the contract
tor building the road themselves, and by vir-
! Tue oil their interest in the Company, to make
contracts as favorable to themselves as possible.
|
siveiy before committees in Congress this win
ter was Vice President and general manager
OF this Union Pacific Road Company seems TO
nave been at the head OF this movement, and
Dough! from parties holding in PENNSYLVANIA
charter called the PENNSYLVANIA Fiscal
Agency" which allowed them to do almost
anything, changed the title to Credit Mob-
ller of America. - In October, 1864, this trans
formation took place, and forthwith Mr.. DtH
rant and his associates, as stockholders aud
Officers Of the Union P. r.. r. Company, con-
'racted with themselves under false names, as
the Oreoit Moblier, to build the road.
| As the Union Pacific was receiving millions
from the Government in the shape of United
States bonds and other millions for the sale of
their own first mortgage bonds, and from the
proceeds of stock sold, money to pay the Cred
1t Mobllier was abundant, and Durant and
friends shoveled it out of the Union Pacific
treasury into the Credit Moblier; that is, into
their own pockets, very freely, and We're able
to declare large dividends to the latter Com
! pany.
In the fall of 1865, about one year after the
Credit Mobilier had been organized, Cakes
ames, large stakeholder, began a war upon
| Durant with a view to Dust him aud become
the presiding genius of the grab himself, which
continued until 1867, when Ames succeeded 10
driving Durant to the Western Division of the
road, leaving him master of the situation. In
to this time the Mobilier had declared diyi-
bends amounting to over 270 per cent
| Mr.. Ames having thus settled himself lost no
time in removing Durant and reducing him to
a mere stakeholder,
This being, as will be borne in mind, about
the close of 1867, or jus: before the meeting of
Congress, Ames went to work to place Credit
Mobilier stock where it would, in his own Ian
guage, do me the most good p that is, Sc
cure such legislation as was desirable to the
Pacific R. R. Company.
| BY act of Congress in 1864, as has been
mentioned it was provided that only half for
| compensation for services rendered the United
| States by the road should be applied 10 the
| payment of the bonds loaned the COMPANY by
the Government. The act said nothing about
the interest on these bonds, and the Secretary
of the Treasury held that the other half should
be appropriated to the payment of HE interest,
whilst the Union Pacific or rather the Credit
Moblier, as contractors for the construction
OF the road, commended that one-half should be