The Rock Island Argus. (Rock Island, Ill.) 1877-1885, 1878-04-09
The Pacific Railroads---Shal They
Swindle the Government Out OF
Their Heavy Debt?


funding bill, which has appeared regularly
for several weeks past in the telegraphic
reports Of the proceedings OF the Senate,
is one of vital importance to the people OF
this country and should be thoroughly
understood and discussed. At the risk OF
presenting to our readers q somewhat
lengthy account, we transfer to our col
umns from the New York Herald full
and clear exposition of the measures now |
before the Senate and of the dangers to
which the country will be exposed in case |
of the failure of appropriate legislation.
In the same connection the New York
World has leader of like import, and its
language is equally clear and explicit in
regard to the aims and designs of the
Railroad Companies, and of the necessity
of Congressional action for the protection
of the peoples interests. The Herald
remarks: There are four of these bills, but
only two of them have made any consid-
cradle figure 10 the debate. Of'these two
one is genuine aud the other sham. The
genuine blll-the one which means bust
ness and is meant to protect the govern
ment-is that reported by the Judiciary
committee and advocated by Senators
Thurman. Edmunds, Herman, Beck,
Booth and their coadjutors. The bogus
bill, which is intended as a stratagem to
defeat the sincere bill, is the one reported
by the Railroad committee and cham
pioned by Senator Matthews and Hill.
The last named of these bills is supported
by the powerful railroad lobby which
swarms through the corridors of the Cap
ito, invades and infests the floor of the
Senate, besieges Senators in their private
houses and hotels and has the free run of
the committee room in which it was con.
cocted. 1t is important that the deceitful
sham be defeated and the honest bill
passed.
We do not choose to discuss now topic
of large scope and interest which these
competing bills and the activity Of the
lobby 10 behalf of one OF them suggests. 1t
has been felt for many years that one OF
the most formidable dangers which threat
en- our free institutions is the overmaster-
ing power OF the great and grasping rail-
road corporations, which corrupt congress
and the state legislatures and are becoming
more powerful than the people, The
country needs to be constantly warned
against this colossal danger, but 1t is be-
side our immediate purpose to dwell upon
it at present We hear it almost daily
said by men of sense and penetration that
the large debt Of the Pacific railroads &c
the government will never be paid, and sc
far as there are grounds for this opinion, /
is fresh proof that such corporations have
outgrown legal control. If this be fact
1t Is a most melancholy and discouraging
fact. While abstaining for the present
from the general topic of railroad infu.
ence over legislative bodies we also dismiss
as not pertinent to the bills now under
consideration the Credit Moblier and
other gigantic swindies perpetrated il
the earlier period of the Pacific railroads
There is no reason for supposing tina
their management is whit more homes
than it was at the time of the Credi
Mobilier. aud considering the character O
the roads it seems important that tn
government should try to protect II
interests before it is too late. The me
In congress who are attempting to enforc
Justice on these graceless aud unscrupulou
corporations deserve the heartiest supper
of the press and people.
ln 1898, when the subsidy bonds issue
to the Pacific railroads will mature. the
will be Indebted to the government tn Il
enormous amount of 1922, 100000, al
Sl77, 200, 900 according to another mode
computation. The difference betwet
these com EQUATIONS turns on the questiC
whether the government is entitled to IL
terest on its semi annual payments.
the debt due from the roads to the govern
meDt at the expiration of the thirty yeal
consists only OF the face of the bonds an
simple interest it will amount to 1922, 900
900; but if the interest paid by tt
government were compounded the del
would amount to Sl77 ,000,0 ln equit
the latter mode of computation is correc
but in law it is possible that the Pacit
roads can be held to pay only the amour
Of the bonds and accumulated slmp
interest. As we do not wish to strain tt
law against the roads we will assume tn
their Indebtedness to the government
the expiration of the thirty years W
consist merely of the principal and simp
interest, the government losing interest {
Its advances. According to this methC
OF computation the amount which the "
roads-the Union Pacific and the Centr
Pacific will owe to the government on Il
maturity OF the subsidy bonds will
Sl22,OOOO0O. The total length Of the roat
Is I,9O0 mIles,sO that when the debt to Il
government natures it will amount
$685. 900 per mile The roads could be CO
structed anew for $4,000 per mile.
hence appears that the value of the roa
az the maturity ofthe bonds will be S 5 on
less Ter mile than the debt which will the
be due to the government
Ii is perfectly clear that the roads do n
intend to pay the debt. There is fir
mortuge on the roads amounting
500, OO0,0 coo, to which the claim of II
government must be postponed Withor
preventive legislation nothing is east
than Tor the roads to make their proper
worth merely this amount at the expi-
ton ut the period, and TO cheat the COVER
ment out OF the whole amount which W
then be due. This danger of the uts
loss OF the government claim was o.
hrst brought into view by II
eient Judiciary committee of the senat
Inc judiciary committee of the last hou!
ct representatives presented it with pc
iect cIearness in d cOgent report, fro
which we make the following pertinent al
striking extracts:
TO pay this the government may fin
Only wornout road, which, put up at au
ton, would not pay the FIRST ruortgal
bonds. And it these should happen to
IL the hands Of those who control the roa
now they would doubtless become the pu
chaSers and sole owners, for the obiectio
to government purchase would be
great it would never be made. and tber
could be no other competitor who wouId /
Formulating rs a nnrnhasnr LIZ IL -