The Indiana State sentinel. [volume] (Indianapolis) 1868-1895, 1877-05-09


point 100 miles west of FL Paso to the Pacific
coast, by way of Gorgon1a pass. AT Fort
Yuma, point about 200 miles east of San
Diego, the Southern Pacific OF California Is
authorized to divert the road from direct
course AID build in north WESTERLY erection
to GOrgOnia pass, on the line OF the southern
Pacific of California, TO San Francisco. This
is manifestly for the purpose of rendering the
entire road tributary TO the Southern Pacific
of California and the city of San Francisco.
IL is true that the original bill provides for a
branch from Gorgonia pass to san Diego, but
it is clearly departure from the idea of a
short and direct route TO the Pacific ocean,
and initiates against the theory of building
up on the shores of the Pacific another great
commercial city to handle and distribute the
wealth which will seek this channel OF trade.
The proposed detection in the line of road, by
way of Gorgonia pass, will add about 100
miles TO its length, which is, so far as can
learn. altogether unnecessary when the main
object of constructing this road is considered.
Besides this, il is well known that the South
ern Pacific of California and the Central Pa
cffic which forms the western division of the
Union Pacific railroad TO San Francisco, are
identical In interest. The people OF California
and San Francisco, as well as the states and
territories along the fortieth and forty-hrst
parallels of latitude, have had transcontl-
mental railroad constructed at the expense OF
the federal government; and the CHIEF claims
of the Texas and Pacific to government aid are
founded upon the theory that IL will open up
and develop an entirely new region of coun-
try, and when completed will constitute
rival and competing route to the Pacific ocean.
To place the western division of the Texas and
Pacific under the control of the same parties
that own and control the western division OF
the Union Pacific would hardly accord with
the theory of establishing competing line To
the acific; IL would be too much like turning
over the lambs TO the care of the wolves, and
should be deemed by this house a fatal objec-
ton to the bill of the committee.
1 submit Mr.. Speaker, that to place this pro-
ject upon square, honest footing TO entltle IL
to the consideration of this house as a work of
national imp ortance ii must be Invested of all
entangling alliances, which are only calculat-
ed TO surround II with suspicion and detract
from its real merit. Such have regarded the
/ hran 10
| leans, and Ntnita, and the alliance with the
| Southern Pacific of California, which und0ubt-
| eddy deprives the project of one of its most i'm
portant features, namely, that of a competing
| road to the Pacific. For these and other reas-
Ons ola like nature / have provided In the
| substitute for the bill of the committee only
| for the construction of the main trunk line
from Fort Worth TO San Diego by what Is
| known as the most direct route, distance OF
| less than / 400 miles, and have left out the
| branches entirely, which diminishes the
length of the road to be subsidized over 1000
| miles.
Inow come to discuss the two plans of ex-
| tending governmental aid to this project, and
with all due Difference to the opinions of
| others, insist that the plan embodied in the
substitute will be found TO be so infinitely SUI
perior to that proposed by the committee that
| and to the country. Heretofore two methods
| of granting aid TO works of internal improve
ment have invariably been adopted; one by
donating public lands, the other by lending
| the credit of the government in the form of
| interest bearing bonds. Both of these methods
1
have been donated 1t has been found that.
| sooner or later, they were monopOlized by the
| few and held for private speculation, thus pre-
venting their occupancy by actual settlers and
retarding the growth and development of the
| country. Eut there is another and still
stronger objection to this method which also
| applies to the method of guaranteeing bonds.
| The corporation to whom lands have
been donated have been enabled by
such grants to negotiate bonds based
| upon them for capital bearing a high rate of
| interest, mostly abroad, with which to con-
struct their roads. This has rendered our
| country tributary to other nations TO an
| alarm ng extent. 1t is estimated that over one
hundred million dollars worth OF products of
| American industry are required each year to
| pay the annual interest on railroad securities
| alone, held abroad. The larger part of this
immense amount might have been kept at
/ home to further enrich our own people, had "A
wiser policy been pursued In the matter OF
aiding works of this character.
nortance by SuaranteeIne bonds is eonaIiv
vicious. Its workings may be seen in
| the loan Of S64 100000 in per
| cent. bonds to the Union Pacific. The bonds
| are still outstanding, and the government had
already paid over S30,OOO,0O0 in interest, OBJ
tanned from the people by taxation, and will
| be Obliged TO pay a great many millians more
before IL is released from responsibility on ac-
| count of that road.
These methods 1t will be observed are indi-
| rect. The railroad companies thus aided can
not use either the lands or the bonds, but have
| TO use them in procuring money. This is done
| by shining through the markets of the world,
| at great expense, and obtaining the use of
money at exhorbitant rates OF interest, which
! largely increases the cost Of construction and
| renders cheap transportation an impossibility.
In the case under consideration the bill Of
| fered by the committee proposes TO guarantee
the Interest, at the rate OF per cent. year, on
| bonds of the company TO the amount in round
numbers of S70O00, 900. The annual interest on
| that sum at per cent. a year is s., 50O,000 or
| for fifty years, the time the bonds have to run,
| Sl75OO0,OOO. These bonds would undoubtedly
| sooner or later follow our other bonds TO Eu-
rope, and eventually, whether paid by the
| this country to send products abroad to the
| full amount of both principal and interest, in
an absurd and ruinous method of raising
money for enterprises of any kind, and 1t is
high time for IL to be stopped. 1t is this policy
that is bankrupting all our railroads, as well
| as all other legitimate industries in the couu-
| try, and which has rendered cheap transpor-
over two hundred million dollars worth ofthe
products of this country required to be
sent abroad each year to meet the interest on
/ our various obligations held there. This, re-
peat, is fearful drain upon the labor and
| sources OF the country.
| Few people stop to consider the wonderfully
| rapid accumulation of money by means of in
| terest II is perfectly legitimate to reckon the
| accumulation of value az compound interest,
for IL the amount sent abroad in payment OF
| interest was retained at home 1t would con-
| tribute TO the increase of our own wealth in
| corresponding degree. For example, let US
| take 81 900 and see what it will amount to in
| fifty years, the interest being added every six
/ months.
| One thousand dollars at per cent in fifty
| years will amount to S2,575S7.
/ The interest on s70,010000, the mount which
| the Texas and Pacific company desire to bor
/ row, would amount in fifty years, at com
| pound interest, to an enormous sum many
| times greater than the principal.
| mention these facts for the purpose of call
| ing attention to the accumulative power of
| capital in the form of money, as money is now
| instituted by means of interest and the false
| principle upon which the system is based. AS
/ money is now instituted IL Is something more
| than mere tool of exchange, as it IL described
/ by the economists. A scarce metal is selected
| as the material out of which to make money,
and one, / may add, that is relatively growing
| scarcer as population increases and society
| moves on; and not content with this, IL is
clothed with the sole power OF legal tender, the
most potent power known in the affairs Of n