Los Angeles daily herald. [volume] (Los Angeles [Calif.]) 1873-1876, 1875-06-16
SENATOR JONES.
Why He Purchased the Panama Rail-
rOad-Ifis operations In Wall Street
A 100000 Sensation spoiled -
How Jay Gould, Instead of Biting
the Senator, Got Bitten.


How Jay Gould, Instead of Biting
the Senator, Got Bitten.
A Chronicle reporter, after the usual
preliminary of sending up his card,
knocked at the door of parlor No. 80 on
the first floor of the Occidental Hotel,
yesterday afternoon. A pleasant,
hearty voice called forth an invitation
to enter. Opening the door, the portly
form of Senator John p. Jones of Ne
vada was discovered seated on tete-d-
tete near the front window. The rooms
of the Senator are those so long occu-
pied by Mr.. Howard Colt, which have
been newly and elegantly refurnished
for him. The usual compliments of
the season having passed, the reporter
preached the object of his visit. In the
conversation which followed the SEN
ator spoke freely and fully. The fol-
lowing is the substance of an inter-
view which lasted more than two
hours:
Reporter-Mr. Jones, the public are
interested in knowing the object which
you had in view in obtaining control
of the Panama Railroad.
SANTA MONICA.
Senator Joaes-My object was pure
ly business one. Before 1 went East
last Fall and Others had projected a
railroad from Santa Monica into the
interior. In my travels up and down
the coast had had several converse
tions with ship-owners and masters.
They told NE of the difficulties of land
ing in the harbor of Wilmington.
Wilmington is, indeed, no harbor at
all. Passengers and freight have to
be taken to the landing in lighters.
Then they have to travel by rail %
miles to Los Angeles. Now Santa
Monica has fine open harbor. We
are building wharf for the railroad
there 2,700 feet into the bay. The har-
Dor lies 80 miles North of Wilmington
and the terminus of the railroad is but
l3 miles from Los Angeles. If We can
get the steamers to land at Santa Mon
lea the passengers would be in Los
Angeles almost at the same time they
would leave the lighters at Whining
ton. The main object in buying the
control of the Panama Railroad was to
influence the Pacific Mail steamers to
land at Santa Monica as well as at
Wilmington. 1 had purchased 10000
acres at Santa Monica harbor, and the
! place is bound TO be the Long Branch
of the Pacific Coast. | was determined
to make the enterprise successful, and
there were but two courses open to me.
| must control either the Pacific Mail
or the Panama Railroad. | did not
think it worth while to get possession
of the steamers. The company at that
time was
WRETCHEDLY MISMANAGED
And heavily in debt. 1t would not
have been good investment. With
the Panama Railroad it was different.
l examined it's resources and its earn
ings and found that the corporation
was in splendid condition. The cap
ital stock is divided into 1000 shares,
at 500 share, and it has been paying
| dividends of one per cent. month,
! although wretchedly mismanaged.
Hitherto it has been merely tender
to the Pacific Mail Steamship Com
pany, substantially the same Board of
Directors managing both corporations,
who seemed to operate 1t entirely in
the interest of the steamers. This was
rather reversing the usual order OF
things. Monopolies general y control,
but in this case the monopoly had been
controlled. There can be no monopoly
of the sea. 1t is free, and a hundred
companies can send their ships to the
same ports. But this railroad is a gen
uine monopoly, and the steamers can
not get along without it. l considered
all these things, and l saw not only
that by means of the railroad | might
induce the the Pacific Mail to make a
landing at Santa Monica, but that |
should be putting my money into a
really good investment. | also found
out the relations of the railroad to the
Government, and made sure that be-
| fore the proposed canal could be made
they would have to buy the road. In
fact, it was worlds highway nd
must remain so. Having discovered
all this | associated myself with Will
| liam Butler Duncan and Trenor w.
Park of New York. and we bought the
road.
SENATOR JONES AS A RAILROAD MAN.
RepOrter-Do you mean that you
purchased the entire property?
l Coa,rfaa, Tnaaoa oh No No konc.bt
enough of the stock to effectually con.
troll the road. We own among us up
ward of half the shares. Then, OF
course, we control the stock held by
our friends. I suppose it is safe to say
that our syndicate represents between
$4,000 and 10000 shares of the capital
stock. We went to work at once to
institute reforms in the management,
and it is safe to say that since we have
held control we have saved $4,000 a
month in reduction of expenses alone,
besides-increasing our business. There
were nine hundred men on the pay.
roll. Wereduced the number to forty
one. The Pacific Mail, under the old
regime, were taking the lions share
of the earnings. We have remedied all
that, and the roll is paying dividends
of one per cent. per month regularly.
RepOrter-And you think it is en-
tirely independent Of the Pacific
Mail?
Senator Jones-If there were no Pa
cific Mail in existence we could run
that road and make money from
it. Why, the South American trade
alone would keep the road on a pay
ing basis. Besides, we don't need the
Pacific Mail, even if we depend on the
steamer trade. We have already re.
| fuSaH tha Offaro IF aOpn,>a as, IN ,,r,.