The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1876-04-25

than two monshs-lndssa. seventy fall days
before got public report exoncrshnS
had asked for committee 70 invessi-
gate the pending matter I should have been
charges all tho while hanging over undsnied and
unanswered, and pending the proceedings OF an IN
vcssigaton which had myself asked proprssty would
have forbidden my collecting and publishing tho de-
cisive proofs which have submitted. For thsss
reasons hayo deemed that tho shortest and most cx
pednous mode of vindication the which was
bound choose by every consideration Of myself per-
sonaliy and OF my official relations. have not omitted
the testimony OF single material witness TO the trans
action on which the accusation against me based.
and unless msapprchend tho scope and force Of tao
testimony, IL leaves charge against
submit tho whole matter 70 the candid Judgment Of tho
House and the country aud II the House thinks tho
matter should be further inquired into beg 10 express
my entire readiness TO givo all the assistance In my
power 10 make tho investigation rs thorough. rigid
and as impartial possible 70 give seeming corrob
Grafton O. Hanast.on to the story which nave as
newspapers that l the owner OF from $3.50 900 TO
e2t00UO OF tho Little Rock and Fort Smith Railroad
II from those bonds that Thomas A. Scott received
his $4,000 Tho statement is gratutousy and utterly
false No responsible su.hor appears anywhere for
this unfounded story, but IN Diminishing Il desire 10
make The following explicit statcment:-
TIE ARKANSAS RALxoAD
Moro than twenty throc years ago, N the closing
days Of Mr. Fillmore's admins the government
granted ~ the state or Arkansas public lands
within IFS own limits to be applied TO the construction
OF railroads In that State The Legislature OF Arkansas
Incorporated tue Little Rock and Fort Smith Railroad
COMPANY the same year and gave TO tho company
portion OF the lands IL had received rom the general
government 10 aid In tho construction OF the road
about 1000 acres TO the mile, think-but the COM
pAny were unable 10 raise any money 10. tho enter
prsc, though they made the most strenuous efforts,
and wi en- the War broke out 1884, eight years utter
the STATE had given tho lands TO the coG-
ul course nothing was done during tho war.
After the war, all the grants OF land previously made
TO the southern states wore received IN In tho
Al In Ifffln Rnek mud Lne Smith
Company again received grant from The State and
again tried TO money to build their road 1885,
1856, 1867 passed without their getting = dollar.
Finally, toward the close OF 1858, company OF Boston
gentlemen representing considerable capital undertook
It's construction. In raising the requisite means they
placed the bonds on the New England market In the
summer Of 1859, offering them terms which seemed
very favorable TO tho purchaser aud offering them
time when Investments OF this kind iatasy pop
ular. In common with hundreds or other people
in New England and other parts Of the coun-
Try bought some OF these bonds, not
very largo amount paying for them at precisely the
that others paid heard, and do not
believe, that tho LATHE Rock Company, which know
Is controlled by highly honorable men, ever parted
with bond to any person except the regular price
liked for their sale. Tho enterprise, though appar
emily very promising, proved unsuccessful, did
many similar projects about the Same time. lost
considerable sum OF money-ovcr SEC. 000-by my in
vesiment aud, presume, New England made net
loss OF 81 200 in completing tlat road Arkansas
as shc has lost over sO0 900 600 by similar ventures
West and South within the last twelve years
In addition to my investment In the bonds united
when 1t mot It's first financial troubles. Proceedings
pending in the United states Circuit Court OF
Arkansas TO which am party OF record, for the re-
imburscmenr OF the money 20 advanced. All tho
bonds which over purchased continued 10 hold
when the company was rcorganizcd IN 1874 OK
changed them Tor stock and bones the concern,
which still own. My whole connection with the road
has been open as the day thcre had been anything
TO conceal about It should never have touched It.
Wherever conccalmcnt IL desirable avoidance 10 advis
able and do not know any better test to apply tho
honor and fairness of q business transaction As to
TnE QUESTION PRoPRiKry
involved in member Of Congress holding invest
mont this kind. IL must be remembered the lands
granted to the State OF Arkansas and not to tho
RAILROAD company, and that the company derived its
lie franchise aud value wholly from the state, and 10
the State the company ainenabe and answcrable,
aud not IN any sense to Congress Since purchased
the bonds but OF Congress has passed. In any
way touching tho subject and that merely to
lily previous mistake IN legislation take It, when
any security from government bonds 70 town scrip, Is
offered at public sale 10 any one who can pay
tor II every American citizen IL FREQ To buy. II
ment on the ground that In some secondary
or remote way tho legislation OF Congress
has affected may Affect tho value OF the article, hen
you exclude every this noor, not only from
holding government bond or share in \ National
bank, but also from owning flock OF Sheep or Held
OF hemp, tobacco plantation a cotton MILL
furnace for all these interests vitality affected
by to tarin legislation which vote ut every scs-
SON. and Of winch an important measure 10 oven now
pending in the COMMITTEES Of the Whole.
In the seven intervening years since Little Rock
and Fort Smith bonds were placed on tho market
iec,sd by the legislation Of Congress- but this case
does not require to be shielded by any such copar
sons or conditions for, repeat tho Little Rock
road derived all that Il had from the State OF Arkansas
and not ifom Congress. IL in the discretion oi
Congress give withhold from the state, but Il
solely within the discretion OF the State to give or
withhold from tho Little Rock Railroad Company.
When tho Little Rock road fell the financial
troubles OF which have spoken there were
CERTAIN INTERESTS
connected with It that under peculiarly pressing
embarrassment and that needed relief There had been
tho Atlantic and Pacific road which on It's southern
branch to BIO connecting line east and wes with
tho Ltlo Rock and Fort Smith, and the Missouri Kan
and Texas roads, which would be . connecting limo
both north and SOUTH at tho point OF junction, aid
the Little Rock and Fort smith enterprise by taking
somo o. It's secur'esra practice very common among
plction OF the Little Rock road OF
very great importance. Accordingly, in the
passed by the Little Rock Company OF It's
bonds and none passed the otner, and when thore
was sanguine hope Of getting the enterprise on rs feet
again, The Atlantic and Pacific Company took 500 900
Ut It's stock for the gross Of $40 0OO and the MIS-
souri, Kansas and Texas, remember correctly. took
half the amount ut the rate This done. not
the corporation ITSELF largely
engaged the construction Of tho road With tho CTR
cumstances attending tho. negotiations with the A.
antic and Pacific roud entirely familiar, and with
several OF It's officers had long been well acquainted
also knew Of the negotiation with tho Missouri KAN
saw any Of its officers and never had an interview
with any Of them any subject; but 10 the case OF
both roads ! desire to say that the bonds
dollar pecunary interest in the whole transaction with
either company.
THE INFAMOUS rxsrSuArIox
made In certain quarters that engaged 70 use my In
nucnce Ia Congress for tho Atlantic and Pacific road
also for Missouri Kansas and Texas road
sderaton OF their purchasing these securities barely
merits notice. The officers aud directors Of both
pancs, 40 iar as have known the one and heard Of
the other are high toned honorable gentlemen; and
they would have justly snurned mo from thor pres
had boon willing 10 submit an Oncr SO dishouor-
able and mutually degrading. ! had no pecuniary
stake in the negotiation and should have loved IN
fanny for infamys sake had battered my personal
and Official honor IN the transaction; and am surc
that every man connected with either company would
repc the dishonorIng suggestion ~ warmly a. do
myself Tho whole affair had more connection
With Congressional leg.sation than any one OF the
thousand similar transactions that constantly
occurring IN The business world
Oi like character with the insnuaon just answered
u that which In an rresponsibIc and anonymous way
attempts 10 connect the ownership Of Ltte Rock and
Fort smith bonds with the legislation OF last winter
respecting the state government Of Arkansas There
accusations which It dncnlt 10 rcpcl with
sufficient force because OF thor mixture OF absurdiy,
Nd f~I hnar ri "A