Western Reserve chronicle. [volume] (Warren, Ohio) 1855-1921, 1873-02-19
The Credit MObIIier.

AnO SANulN AlObillNA
From the Boston Advertised
1t is doubtful if the history of our
national government can furnish a
more pitaOle spectacle than is now
presented at Washington. 1t seems
as If the net result of the session of
Congress was TO be an investigation
which, with IN 5 and parade enough
for the trial of Warren Hastings,
promises to end in the discovery OF
nothing of value which was not known
before, aud of nothing concerning
the transactions of members of Con-
gress in Credit Mobilier stock or any
other in which Congress or the pub
lie had any right to inquire. Mean
while the panic among the members
is painfully ludicrous. The denials
and recriminstions, and the showing
back and forth of checks for a few
hundred dollars rs if they were tain.
ted with small poX, seems to indicate
that backbone is no longer an essen
tial quality in public life. The scare
as usual, is so much the greater be-
cause the danger incurred is not very
definite. So far as the evidence goes,
there has been no bribery, no giving
or taking OF stock i'm exchange for
legislative influence proved against
anybody. As not one man out of q
thousand, however, reads all the evil
dence that is published, the impress
sion got abroad that the Credit Mo
bilier Company was a gigantic scheme
of fraud; and that anybody who held
its stock was ipsO JdctO a swindler.
We fully believe that if the members
had followed Mr.. Bingham's example
and had the manliness to confess that
they did own the stock and had a
right TO Owl it the spectre would
have been stripped of IFS terrors.
People are still asking what is the
meaning of this terrible Phrase, Cred
it MObilier, and it may be well to re-
peat once NOR the explanation of IL.
tits the fashion of thehOur TO represent
il as the instrument with which Mr..
Ames aud his associates robbed the
Government, distributing a few
shares here and there to prevent FIX
posture or to secure accOmplices. We
take the risk of being out Of the fash
ion for a while rather than give cur
rency to n such absurditI+s. The
act which authorized the building of
the Pacific Railroad pr, vided hat the
stock should not be sold below par.
At that time it seemed that the only
chance for profit was in the stock,
and this amounted to nothing, if no
body could get the stock without pay
ing 500 a share for il. The. Credit
MObilier company was therefore avail
ed of, and contracts were made to
build the road for ali the securities,
bonds, stock aud lands which the
charter gave, any surplus above the
cost of the road to be divided among
the stockholders of the company. 1t
was regarded a exceedingly doubtful
whether there would be any such sur
plus. To our personal knowledge
Mr. Cakes Ames, at the same time
that he was selling stock to such men,
bers of Congress as cared for it, was
freely offering it to our prominent fl
nanciers. 1t was declined by several
bank presidents aud bankers-cer-
tainly for no moral reasons-whO
were at the same time eagerly taking
up stock i'm other Western enterprises,
To n gentleman, with whom MIR.
Ames had business relations, he Of
fered the option of taking the stock
at par within sixty days, and upon
solicitation renewed the option for
another sixty days; and as within
that time the market price had advan-
ced to 125. the gentleman availed him.
self of the option, and sold the stock.
Mr. John l. Blair, of New Jersey,
who has amassed a large fortune in
railroad contracts, stated at q dinner
given him in this city that 1.-The
Union Pacific was too big for him."
anu he had declined an interest. 1t
ghar1A lao nAla1 nanFnnvnF thai oil !
the legislation in behalf of the Pacific
Railroad was PASSED before the Credit
MObilieT company was connected
with it at all, and from three TO four
years before the transactions with
members of Congress, now under in
Investigation. As the building of the
road went on it was found that the
difficulties had heen greatly exaggera-
ted, and that the cost of crossing the
mountains was much less than had
been feared, and very large profits
were realized. 1t was the old story of
Columbus making the egg stand up
on the little end. Anybody could zee
it after it was done.
. This device of a contracting com
pany is by no e peculiar to the
Union Pacific. The Central Pacific |
had a Contract and Finance Com
pany" Of exactly the same nature,
which realized much larger profits
than the Credit MObilier. The only diff
ference is that there have been no Du-
rant and McCOmb to drag it before the
public. Numerous roads in Iowa and
Wisconsin have been built upon the
same principle. We are no defenders
of this sort Of railroad building.
Much good, we hope, may result from
the Overhauling. But the overhaul
ing of single enterprise. from which
the country has received, and is daily
receiving, rich returns for its invest
ment, while a cor of others not vet
finished, are going forward to-day I'M
rebuked, under the very noses of our
censOrs, will lie likely Il prove neith-
er edifying nor profitable to the couu-
try.
The land-grant bonds OF the Union
Pacific illustrate exactly one point in
this discussion. The Company issued
ten millions of bonds, secured by all
the lands granted them. By sales OF
land, they have reduced this amount
to about seven millions, and they can
be bought by anybody in the market
at about seventy-fve cents OH the dol
lar. These bonds will doubtless be
at par at no distant date
from the sales of land, and there will
he another cutlery at the profit made
On them. The fOIethought is not very
which can see an event after il