The sun. [volume] (New York [N.Y.]) 1833-1916, 1876-06-09
JAY GoULD's PROPOSITION TO CON-
GREss.
II Is Absurd and What Justice
10 the People Requires.

To THE EDrroR OF The SUN-Sir. The
Union Pacific Railroad has made another propo-
sltOn to Congress for the settlement of the i'm
mense debt which will be due to the Govern
ment In 1856
1t ls, that 100000 per annutn be paid for the
first ten years, aud Sib0,0O0 rer aunum thercaf-
ter, into sinking fund. This is TO be received
ny the United States Treasury, and interest at
the rate OF six per cent. per ann um, compounded
semi annually; and the Government Is, In con
slderation OF the prompt payment of these, to
relinqulsh Its right 60 the I'VE per cent. OF net
earnings, to which 1t is now entitled, ana also to
pay the company in fun for Its transportation
CHARGES, Of which one-half is now retained. The
proposition to recOnvey the lands to the Gov
eminent at rate Of $50 per acre ia withdrawn.
II will be rememoered that more than one
year ago, Sidney Dillon, Jay Gould's represents
tive made two separate propositions to the
Secretary Of the Treasury for the settlement OF
THIS indebtment OF the Union Pacific railroad.
The hrst wis somewhat similar In Its terms to
the present one In regard 20 the annual pay
ments. The payments for the FIST ten years
were TO be at the rate OF 100000 per annum (;
$'5O.OOO Tor the next ten years, and $l,OcOOO per
annum thereafter. His second proposition was
still more liberal In it's amounts to be paid each
year There WIS no suggestion that the claims
OF the Government for Eve per cont Of the net
earnings DO relnuuished, or that IL should not
retain oue-half Of the amounts due TO the road
for its transportation.
The decision OF the Supreme Court, however,
has been received suce then, and, relying ON
Its holdings. that the Pacific railroads are not
obliged to pay either principal or interest until
thr maturity Of the bonds In 1890 there Is an
unmistikahle reluctance to offer the Govern
ment as much IA was rendered before the judicial
Interpretation Of the contract.
In fact, the present offer Of the roads would,
" accepted, leave the Government little better
than IN its present condition. The I'VE per cent.
OF the net earnings which the Government eau
now collect. and the Une-half of the transDorta-
retained
Treasury. 20 a long way toward making up tho
$GW,OJJ per anuum which the road would bind
Itself to pay over to form sinking fund. Ia
ten year. frOui now. when the receipts of the
road would have largely increased by the natural
growth Of tr5ffic, 1t Is more than likely that i've
per cent Of the net earnings and one-half OF the
Government transportation charges would
amount to more than the t75o.OOO which the road
would then begin To pay.
Even surprising that the Government should
retain It's present rights with respect to thls i've
per cent OF net earnings, and to the retention
of one-hu6 ot its transportation charges, the
sum whicn the road offers ~ pay Is ridiculousiy
insufficient
Under tnis offer, one million a year for the
nrst ten years, and one aud one half millions for
the Il, xt ten wears would he the largest amounts
the Government. This would be but wsnty
i've millions of dollars. aud the actual amount
OF money paid out 10y the Government IN inter.
est anu Tor taking w tue ounGs would be ST.
Or.0O.
Even hv compromising on the am cunts paid In.
IN ''''''''''' y ''''--' ~ '"'u
Instead Of making a fair proposition which
might be accepted by Congress, with "a knowl-
edge that IL would be- for the best interests Of
the road and tue people n II ~positiou II evinced
ON the p.rs Of jay Gould to make each new offer
on the rart OF the Union Pacinc ksiiT Dad more
ptiful and mad, quate. Even the offer OF the
rUad 70 TecOnNs, the Lands To the Government Is
better thln the last proposition, for while in the
one case the road would be compelled to turn
over something In satisfaction Of It's Indebted
ness, Ia the other u 10 an open ques lon
whether the Government would not lose some
thing w1iCh II II now receiving.
The Treasury now disbuIses more than 81 COO
90 per unuum interest ON account of tue Cufon
Pacific Railroad. and this Outgo has to be kept
W ia an for thirty years. No proposition
can he rcgar ed MS at all adequate which does
not at least require tue roau TO paw annually
into the United States Treasury as much as Is
paid out Oh its account. large amount Of in-
tcrcst has already accumulate u, aud II will be
uece-s ~ Tor the road to nay at least S2.5OO.OOO
per AMMAN uutil lsg0. IN order to reimburse tue
Government Oh It's interest account. There
viii then Toe lief, the principal Of So $4,000 to be
ItONued for. Ifthe moo Pacific Railroad has
not money enough IN It's treasury at tina. time
To take 40 lis bones, tue Government MAKE
some neM airansculent or sell out tue properly
unucr foreclosure. The road wouIl certainly
sell FOR enough to satisfy the Claim for 81 ESQ.,.
UtO. A. for this last scheme Of Gould's, " ords
fail To convey u correct idea Of its inadequacy.
la financial circles II Is not believed that the
Judiciary Committee will give tho propos ition
auy consideration. but that they will set to work
To elabori,e a plan which meets the require
ments Of the case. II II Is not acce uted b, the
roads. 1t ~ believed that tue exturtloiaIe
freight and passenger tariffs will be raised.
SIIlAHOIT.