The Eaton Democrat. (Eaton, Ohio) 1875-1903, 1878-04-25
SOUTHERN PACIFIC RAILRoD.
Emphatic Condemnation Of Subsidies.


| |
Tho T-hirfy-second Parallel Road can be
Constructed Without PIedging the
Public Credit.
The Texas and Pacific Railroad.
SYNOPSIS OF THE MINORITY REPORT.
The Pacific Railroad Committee of the
House having by a vote OF seven to six
agreed to report the Texas Pacific Bill
favorably-two or more of the seven ex-
pressing their desire to amend it, or defeat
it on the foor-the minority members
Messrs. Morrison. Landers, Luttrell, Blair,
Rice and Hewitt have stated their views in
a report of which the following are the
material portions:
We are unable to concur in the views OF
the majority of the Committee, but desire
the adoption by Congress of such measures
as will secure the early construction OF a
transcontinental railroad for the special
use and development of the Southern and
Southwestern States and Territories. We
believe that this important object can be
accomplished without subsidy from the
government, and submit the following views
and the accompanying bill for the considera-
ton of the House:
THE PRESENT CONDITION OF THE SOUTH
ERR LINE.
The Texas and Pacific Railway Company,
| a corporation of the State of Texas, in the
year 1871 was authorized by Congress to
| construct its road and telegraph from Mar
| shall, in Eastern Texas, along and near the
thirty.second parallel of North latitude,
through that State and the Territories of
| New Mexico and Arizona to San Diego a
| small city on the Pacific coast, on the bay of
the same name, supposed to be well adapted
to commercial purposes, and having popu-
lation of 1000 to 5000 people. The distance
from Marshall to San Diego is estimated at
1,574 miles by the authorities of the Texas
and Pacific Company, while those of the
Southern Pacific Company believe it to be
about one hundred miles greater.
Failing to meet these provisions, the Texas and
Pacific Company'h has obtained by construction and
purchase and has now in operation AS miles OF
road, which enclosea parallelogram in Northeastern
Texas, having a base Of 1888 miles, extending from
Marshall to Fort Worth, now the western %terlsinus
of the road, which only is a part Of the trunk hss.
secure the more valuable land grants by the State
of Texas, probably because the Pecuniary embarass-
ments OF the company, were such that It's credit was
based chiefly upon the granted lands. There is
thus remaining of the trunk line between Fort
Worth and San Diego, a distance of ,491 miles upon
which nothing has been done.
OF the ten years allowed by the charter within
which to complete this great work only four remain
and a considerable portion OF one OF these mus
elapse before the enactment OF the desired legisla
ton is possible. Six-tenths OF the time has beer
consumed in the construction OF less than one
eighth of the trunk line. and that at the Easteri!
terminus, in close connection with the great middle
system Of roads and the central belt OF States
rather than with the Southern system of roads ant
the Southern States.
The corporation has fallen thus far short of tn
performance of its undertaking, although itreceivet
from the State of Texas the magnificent grant 0
the alternate sections of land for forty miles II
width along each side 81 its line, or eighty miles IL
l N - l. g. o To-aa- and fha oon.A From
the United States through the Territories and II
California, contingent upon its compliance with tn
conditions Of the grant.
THE SUBSIDY DESIRED MORE THAN THE ROAD.
The credit of the Texas and Pacific Company wa
seriously impaired before the panic OF ls73,-a1
under its influence has still further declined. !
admits Its peculiary ability, and assigns that as
reason for its failure te comply with the condition
In 1876 it applied to Congress for q subsidy O
over $50, 900, 900. in addition to its land grant of o.
SIC, 900 acres in Texas and Is, o0o,O 900 in the terrific
ries, being a money subsidy of twice the probable
cost of building and equipping its road.
The application failed. 1t now changes the forn
rather than the substance of its request. and ask
for a guaranty of interest on S25 900 q mile for thu
easier, and SAC. 000-for the heavier PORTIONS OF thu
road, amounting in all oS3s, 1000 at five per cent
annually, for nifty years.
The bonds of the government bearing four and
half per cent. interest have recently been sold a
PAL. In refunding the national debt. If the publi
faith is kept and its credit unimpaired. the time 1
not remote when the government Will be abe u
efectloans at the rate of three and three and
hall per cent, as now paid by England. The diff
, ference between the interest on these five per cent
Texas and Pacific bonds for fifty years and tn
) ordinary rates which the government will have u
pay on the same amount for the same time, If in
yestigated as it might be by the government for tn.
payment of its own debt, would amount to mucl
| more than the cost of the road, so that the govern
ment would be far bet.e r of to build the road AM
> give it to the Texas and Pacific Company sutrighr
than to guarantee the interest on its i've per cent
, fifty year bonds, according to its request.
The total amount of interest guaranteed. by tn
5 government would If paid into q sinking fun
amount to more than 500, OOO, 900 in fifty years, an,
|. we are called upon to guarantee the payment OF thi
sum in addition to the proceeds OF the land gran
in order to enable the Texas and Pacific Compan!
I to complete its road.
: guarantees by the government in whatever form 70
f the benefit of railroads at this time, however desira
BILE their construction. In tiIAe of peace priyat
capital seeking profitable investment will general
, promote commercial development quite as fast as
consistent with safety and permanent prosperity
: II the men in charge of a meritorious enterpris
tooSasiiy won trust Of the middle classes, there isl
4 need of calling upon the nation for subsidies {
guarantees.
t THE SOUTHERN PACIFIC RAILROAD.
r The Southern Pacific Railroad Company is a CO..
poration of the State of California
5 This corporation has constructed its road to Fo
f Yuma, on The Easterly bank of the Colorado Rive
in the South westefly corner of the Territory
| ATlZOUA, WnlCn b Cldlu5 70 U6 Iu6 duluOTlLcu pun
O of connection with the Texas and Pacific Road,
= distance ofabout 720 miles. Its track has been lai
s through and over extraordinary natural obstacles
theexpense of about $50, 00o, coo, and the $50 miles
] its Southern portion passes through a desert and Fl
u 164 miles nearest Colorado without an oasis. TIL
a road, built to preserve the charter, is of little vail
U except for its anticipated connections with Il
= Southern States, from which, owing to the failure
the Texas and Pacific company to comply with tt
acquisitions of law, it is now more than 1000 mil
distant. -
The road is already there with its millions
e money invested over a sandy waste, upon the got
q faith OF the government that the Texas and Paci!
y Road should be constructed SO as to meet it at Il
Colorado River or in the event OF the failure OF tn
corporation 80 to do that Congress should take su,
measures as should enable It to connect with Il
, Southern States Of the Union.
POSITION CT THE soUTHRR PACIFIC COMPANY.
/, The Southern Pacific Railroad, by force of the q
solute necessity of its securing Eastern connectio
assoOn as possible, in order1to preserve its capital
the only party which has both the power and t
dispo ition to build this road.
The Southern Pacific company interposed no Q
position to the guarantee asked by the Texas q
Pacific east of the Rio Grande; but contemplate
v the.contingeucy of the denial of guarantee of bon
toIthe Texas and Pacific company, and the com
e quent total collapse of its undertaking, strongly !
y sisted that Justice acquired that they should not
held in check awaiting the result of continued q
plicationsb by the Texas and Pacific company for I
l. money or credit of the nation with which to perfol
st what the Southern Pacific was ready to do immes
a ately for the land alone.
10 TINS Dill the 1eXaS ana fac1uc company
E. jected. The only argument entitled 10 weight,
r our opinion, was that the Southern Pacific, come
:. ing with the ocean at San Francisco, and having
II innate business relations with the Central Paci
1T Railroad, might enter into combinations with Il
q corporation against the public interest, and that
a advantages of competition and of an occasional cC
ID nection atSan Diego would then be lost.
N COMPETITION AND C~oMsINATIoN.
~ We believe that any competition between ri
re parallel lines of railroad for the same busine
at which results in a loss to the companies, is sure
end in one Of two ways, either in a combination
which the pubic will lose far more than it has e.
re gained from competition, or, on the other band,
" the ruinous cutting Of rates persisted in until
;! weaker corporation is ruined, the public is left
e. the rapacity Of the survivor. There is ne real p
ia lection to the public but in the enforcement of
law Of the land. Comp tition which takes fir
corporations just compensation is quite as ruin,
I'd as combination which gives them too much.
to No one can believe that the Texas and Pac
w Company wouli, after constructing its line to
q Pacific Ocean, long compete with any rival to
al own loss or even so as to produce any reduction
y rats being the maximum to which the public wo
ce submit; or that 1t would fail to repair its losses
increase its gains whenever an opportunity mi,