Belmont chronicle. [volume] (St. Clairsville, Ohio) 1855-1973, 1876-07-20

DEN MANIPULATED WESTERN RAIL
RoADs-THE GREAT CHICAGO AND
NORTHWESTERN RAILWAY RING
How WESTERN FARMERS SUFFERED
THRO' TILDEN's MANIPULATIoNs.
The Rockville Valley Union Rail-
road was intended TO run from Chica-
go into Wisconsin. A charter was'Ob-
tanned, bonds issued and exchanged
in England for railroad iron, the same
shipped to Chicago, and some of it sold
to pay the expenses of the charter and
provide meaps for grading the track.
The road was finally foreclosed, and
out of the foreclosure grew another
company, entitled the Chicago, Fond
du Lac and st. Paul Railroad. This
company had for its President prom
inent gentleman, and its cars were rum
| ming over about sixty miles of track
when second collapse took place.
ENTER SAMUEL j. TILDEN.
This was about 1857, and in those
days railroad companies obtained large
amounts of money from the Eastern
banks, the officers oEedirectors indor-
sing the cOmpany's Hper. The Presi-
dent of the Chicago, Fond du Lac &
st. Paul Railroad had indorsed heavi-
ly for the company, and was large
owner ofreal estate in Chicago. In the
dilemma in which he found himself he
engaged Mr.. Samuel J. Tilden as coun-
sci. The President had taken the pre-.
caution to secure himself, by taking
the railroad company's bonds as collat-
eral. The question of usury was raised
and compromise suggested of eXchau-
ging real estate in Chicago, at q high
valuation, for bonds and stock of the
road at par. Unsecured creditors of
the company were offered common
stock for 60 per cent of the claims,
while the said stock was worth in the
market about Is per cent of its par val
ne. Another Reorganization then
took place, under the title of the
CHICAGO NORTHWESTERN RAII WAY,
with P. Ogden as President, nd Sam
uel J. Tilden as Trustee for the bond
holders. The usual watering process
took place, and the company was sad
died with bonds and stock of about
$42 600 per mile. The company had
hard time with its load of debt, and
struggled along until 1868, when Til
den q Co. saw that something must be
done, and, in casting about, set their
eyes upon the
GALENA & CHICAGO UNION RAILROAD,
which was then running from Chica-
go to the Mississippi River. 1t was
the first railroad in the West, having
been chartered in 1855. That company |
had never watered its stock, and sell
dom. if ever, had it failed to declare an
annual dividend of from to 10 per |
cept. In 1864 it had some 800 miles of
road in perfect order, on which was |
based a mortgaged debt of about $10,. |
600 per mile, and stock issue of but |
$40 600 per mile. Its net earnings for |
1868 were over $1,000,000, and it had |
about that sum In cash in its treasury
rs working capital. Its stock was
largely held by those living along its
line, and was looked upon as favOrite
investment for trust funds involving
the estates OF widews and orphans.
Stock was bought and borrowed, prox-
les secured, and finally TiIden & Co.,
manipulated so that they had a major
ity, and obtained possession of the
property, when 1t consolidated with
the Chicago & Northwestern.
THE KENOsHA AND ROCKFORD RAIL-
ROAD.
The consolidation paid SO well that
some cheap railroad properties which
might be consolidated at high price