The spirit of democracy. [volume] (Woodsfield, Ohio) 1844-1994, 1873-01-28
THE CREDIT MOBILIER.
MORE IMPORTANT DEVELOP.
NENrS.
Al Astonishing Statement from
Mr. Duranf Concerning the
Building OF the Road,

WASHINGTON, Jan. l7.-The interest
in the Credit Mobilier investigation is
now pretty much all concentrated to the
Wilson Committee. The Poland Com
mittee held no meeting to-day,s expect
at their meeting on tomorrow to finish
their work by examining Oakes Ames
again, and putting few questions to his
Secretary, They will then close their
doors and deliberate on their report
The Wilson Committee sat all day
Thos, c. Durant was on the witness
stand all the time The Committed, who
are evidently investigating to find out
the truth, have no easy task in trying to
get explicit information from him, owing
to his habit of answering questions in an
evasive way. 1t usually requires about
live minntes to Get a positive Yes, or No
from him on any important points the
committee are frequently obliged to sit
patiently for long time while he over
hauls his books and papers, assisted by
his Secretary, Mr.. Crane, who sits at his
elbow. The persistence Of the commit
tee always wins in the end, however, and
as the result of their work light begins
to be throwl upon the doings Of the pat
riotic gentleman who constructed the
great highway across the continent"
1t is not creditable account that Mr.
Durant unwilingly gives Of the transac-
tions of himself and his associates, as
directors of the Union Pacific Railroad,
! and at the same time directors of the
Credit Moblier. One of THESE transac-
! tons, detailed to-day, with obvious re-
luctance, would, according to the common
standard of commercial morality, be
characterized by very harsh term 1t
appears that after the road had been built
to the Tooth meridian under what are
known as the Hoxie and RoOmer con-
tracts, the Company constructed 23S
miles more under the supervision Of its
own officials, at cost of S27 500 per
mile, including equipments.
Then the contract was made with
Oakes Ames and transferred to the
Credit Mobilier to complete and equip
the road, at from SAT, 500 to S103, 500 per
mile, increasing with every section ofl0O
miles of track westward This contract
was made to apply to the 23S miles
already completed-that is TO say the
Credit Mobilier agreed to build that much
road at about $50 900 per mile, which was
already built, and had cost only $27,5OO
per mile
The Union Pacific directors made this
remarkable contract in Octo Der, 1867,
and, two months afterward, they took
from their treasury S2,250,000 in first
mortgage bonds Of their road, and So,
250,OO0 in their capital stock and handed
it over to themselves as directors of the
Credit Mobilier, for division among the
stockholders in the latter concern, OF
which they were the chief. This was the
profit on the 23S miles of road which
was already built when the contract was
made, and it was ciphered out by deduct
ing from the Credit Moblier contract
price the actual cost of the road. The
balance furnished dividend to the Cred
it Mobiier stockholders of 120 per cent
on their shares.
, The only thing Mr. Dnrant could say
in palliation Of this transaction was tha
it enabled the road TO make more ia
vorable contract for the unfinished par
of the line. There is very little il
E this excuse, for the reason that the di
rectors were in reality contracting witt
themselves to build the road, and in do
, ing so they put the price high enough
to absorb all its assets and all the mon
ev it could borrow. This dividend o
S4,500,000 in bonds and stocks had &C
: crued and was payable at the time whel
Oakes Ames began to place his Credi
; Mobllier bonds among Congressman =
1t seems to have been, to speak in plail
, terms, filched from the Union Pacif
Road by its own directors, charged witt
guarding its interests and dividet
, among themselves and their friends.
:. No valuable consideration whateve
; was given in return for it. Mr. Durant
: after close questioning, said that the en-
/, tire Union Pacific Road. if it had beel
economically built, would not have cos
over S65, 900, 900, and he was forced t.
admit that the Government aid and tn
. capital stock, if paid as the act of Con
,, gress contemplated. would come withi
. S2,000000 of buiIdng and equippin
the road, thus leaving the Company wit
: no debt save that to the Government
and with its vast land grant untouched
If this had been done, he thought tn
road would now he paying dividen
of five or six per cent, and that its stoc
= would be worth eighty-fve, apart trer
: the value of its lands.
Further questioning in relation to tn
= contribution which Mr. Durant made
of $4,000. to elect Mr. Harlan to lh
Senate, developed the fact that the tw
:, !, checks of $4,000 each were drawn on
: New York hank, payable to Mr.. Hal
lan's own order, and not sent to an
campaign committee in Iowa. Mr.. Du
= rant swore positively that he had no
= charged the amount to the railroad, bu
: he admitted that the new Board of d
. rectors had made some inquiries abou
it. He ha !, he acknowledged, been i
. the habit of spending money TO contre
y elections in Iowa, sometimes helping
elect Democrat to local office, an
q sometimes a Republican, his object bt
- ing to "put good men in"
' The witness occupied long time e.
planning suspense Account of S43'
900, which was finally audited in a my'
'e terious manner, the auditing committe
e being required only to satisfy then
A. selves as to the items, without req oriin
1t them. Much of this was for 'prelimil
a airy expenses" and under this head b'
d tween $4,000 and 100000 was pal
= to j. B Stewart and $4,000 to $3.50
1t 600 to Alex. Hay, who were the Con
= pany's confidential agents in Washing
l. ION when the act of 1864 was bein
et worked through Congress, and afte
$ ward in certain transactions with I'll
d Leavenwurth snd Pawnee Railroa
Y Companies. Mr. Durant said he ha
never required them to account for til
money by vouchers, and had simply tt
s. ken their receipt for it. He did nj
le know that any of it had been spent
ID influence legislative or elective action
W These agents will, no doubt, be sun
Is nonnd hefore the Committee Ia Give