, 1873-03-28
WATERING RAILROAD 8T0CKs

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"hAsANu naAuaonO oloCho.
10 INC Editor q The Chicago 1Fibnne:
oH: noeoo LILO articles In your piper Of yoetcr-
uay "na To-Day IN regard to watering Railroad
ntock and tho quotation from tho clause In tho Con-
sAtusloh bearing upon tho subject; and notice the
tenor OF tho article, indicating that watering railroad
Rtock can be prevented by enforcing tha claBo in
tho Constitution.
do not believe tho writer Of the article B correct in
stating that tho clause quoted in tho Constitution can
prevent wllat f'o thinks ia unju1t to tho public.
Having lately had occasion to study that very snb-
5oc, md having discussed tho matter with leading
counsel, am Of tho opinion that tho Conatituton docs
not prevent tho Issue OF M unlimited amount OF stock
ny rNroaa companies; md nm also Of opinion that
no law can bo passed to remedy tho objection If water
Ing stock 10 80 very objcctionablo), ,ucsa the law
should specify the prseae MIN that railroad companics
should pay for construction Ifit should do that
contend 1t would practically prohibit tho building Of
railroads.
ING parties interested In building new ues Of rail
foaa arc two, VIZ: Thoso living along tho proposed
nhe, aud Foreign capitalists who advance monoy for
the profit IN tho enterprise It established fact
tlat those parties living along the line cannot furnish
money moro than sufficient to grads and tie roa-a
very small proportion Of tia coat Of tho road and
eqnipnent-so that 1t follows TINT foreign capital
n'nst bc obtained. and before obtaining it, largo In
aocement8 must 10 offered for It, especially In Wow Of
tho fact that n such new enterprises havo elements Of
uncertainty tn regard to tho future. So contend
that law passed In tlts shte naming limited sum to
10 paid by new lincs Of railroad for construction,
"o"la pFActtcaiy Rhut out foreign capital from aARst
ing ne" lines Within tho State, and consequently pro-
no,t any moro railroads being built within tho sata.
~ lega1u u pro.oiting aa unlimited 1aauo OF stock
=! ~" nes ra'noaaa. ny enforcing Lilo provisions
by what means atocs IL ,sauo ~ s ~ Ivy" s
the limits prescribed by the Constitution.
l., a ta.oaa company e. now hno> contracts with
strucIton connanv hono or W., b+snn ,nrra uo so
tho railroad francsoa- contract between the par
ties being that tho construction company will build tho
noro.ro 1onas ~ ~ ,airosI .@.' ,aa .ha ss
subscriptions to the stock Of the rallroud copany
and $25ooo per mile OF fu-pa!d stock-tho construc
..on e9.'pauy oe4ns cnep,eu 10 nako psohs tof
ceiyed '1A4 Az
Has not tho raisroad company complied with the
provision tn tho Constitution by giving its atock for
cou,nmont. ctc mt lin ~ Mconaruoo,' ' 1.u nss
gives equivalent for tho Same, according to tho
terms OF tue contract?
an o.or,taut nriea for atnn ita road an, t:4
Is thcro anything IN tho Constitution prohibiting
corporation or m individual from fixing the terms Of
i,o ~ '''' ''''''' " u" ~ 1A' oeon' aa''sA-
But is It IN oxorl,Itant prlco? The aconstruct;on
company" assumes nil tho labor and anxiety attendant
laso en.ssprso, oee,ues riaks OF
and has for its reward urre amount Of railroad anc
which, In the future, may or may not 10 Of value.