The new daily appeal. [volume] (Carson City, Nev.) 1872-1873, 1873-02-22
SOMETHING EXPLANATORY oil
THE CREDIT MORILIER.

AS to how many of our readers
have q clear and exact understanding
of the Credit Mobilicr about which
there has lately been SO much talk,
it would be difficult to surmise; but
rs highly as we estimate their intel
ligence we have lurking doubt OF
their complete knowledge Of the ma
ture of the same. Even are who are
supposed to know, and who do know
everything, have to overhaul our IN
exhaustible mine of information be-
fore we feel fully justified in stating,
in SO many words, what the SAID
Frenchyfied banking dodge is, where
it got its origin and what it did III
the way of an ostensibly legitimate
business. Here, in a rough outline
is what and how it is: Passing over
the earlier history of the Union Ia
cifc Railway enterprise We come
upon the fact that under the tirst
Act of Congress providing for pub
lie aid to said enterprise the difficulty
which stared its projectors IN the face
was, not that the government bonn-
ties we're insufficient, but that the
government itself was given the first
mortgage upon the road; and that
it was not until after the passage OF
the act of July, 1864, whereby the
government relinquished its first,
and accepted in lieu thereof a second.
mortgage, that the favorable attention
of capitalists was drawn toward the
proiect-the further fact being borne
in mind that under this Act of July,
1864, the company were not only FUR
nished with handsome periodical IN
stalments of Uncle Sans bonds but
we're authorized to issue bonds OF
their own, secured by said first mort
gage. Here then was banking capt.
tai in lavish abundance; and it was
when this splendid scheme for the
easy getting of great quantities OF
the public money had come fairly to
a head. that the idea entered the
brains of some Of the shrewder
stockholders that they might get
the contracts for building the
road themselves, and, by virtue OF
their interest in the company, to
make those contracts as favorable to
themselves as possible. The idea
may be better understood, perhaps,
by supposing that five men, A, Is,
C, d and E, are in partnership, and
the partnership business needs
store. A, & and c enter into AL
outside partnership to build the
store in order thereby to reap the
profits of the transaction, and then
by virtue Of their position and iniiu
ence in the original partnership, let
the contract in the name of that
partnership to the outside partner
ship they have formed. Thomas {.
Durant, originally Vice-President OF
the Union Pacific. seems to have
been at the head of this move.
There was in Pennsylvania Il sort OF
Specializing company incorporated
by the Legislature OF that State
under the name of The Pennsylva.
MIA Fiscal Agency and this affair,
which had charter allowing it to
do almost anything, Mr.. Dnrant
and his associates bought, changing
the title to "The Credit Mobilier OF
America" October 7, 1864, this
transformation took place. and forth
with Mr.. Durant and associates, as
stockholders and officers Of the
Union Pacific Railroad Company.
contracted with themselves as the
Credit Mobilier to build the Union
Pacific road. AS the Union Pacific
was receiving millions from the
Government in the shape OF United
States bonds, and other millions
from the sale OF its own first mort
gage bonds and from the proceeds OF
stock sold, money to pay the Credit
Mobilier for its labors was album
dant. and Mr.. Durant and his friends
ladled it ont from the Union Pacific
treasury to the Credit Mobilier treas
ury. i. e., into their own pockts, IN
great quantities and with much zeal.
Everything coming into the Union
Pacific above the bare cost OF con-
struction being paid over to the
Credit .Mobilier, the dividends of
that company were tremendously
large. In the fall of 1865, or after
the Credit MObilier had been in