, 1880-12-05

AS to the effect OF this new llNe upon
transcontinentai business and upon the ab'l'
ity Of the Central aud Union Pacific Roads 10
pay their debt due the Government When
large portion of the business of the country
is diverted to the new road. Mr. french
says:
The average annual amount Of earnings from
+'through'' business over the two roads nas
been Slu,3l sC4.03. In this lies the most 'fnPo1-
tant question for the Government to consioer at
the present time. Under the Sinking Fund
law, . per cent Of probably sS,oArUoo
OF this business Is required 10 oc
paid into tho Treasury by the companies cquai1
say, 10 Il, ,50o,N0 per aI,num. Should onc-:'ali
only If this business be diverted to tho new
route it would So reduce the net earnings oi
both companies, more especially those Oh u1e
CtntruI I'lcldc subsidized line, which line las
not i very large local business. that tho Gos-
ernmcut shnrc would be reduced more thah
onc-huf Of tho 81. .a00, ,0U0 referred to. The mat
ter is one Of such importance as to demand the
most careful consideration on the part Ut tho
Government. as bound up in It is the question
of security and ultimate payment, or the loss OF
the entire debt Of those companies. which nj
nlaturi,v will probably amount to more than
<ltQuktU00, even after au the compensation TOR
transportation service has bcen applied there
on Another important question which has
been suggested by tho opening OF tho new route
IS thnt Uf the consolidation OF the Central anu
Cuiuu Pacific systems Of railroad, including the
Southern Pacific. Without entering into de-
tailcd discussion Of this question of consolida-
ton, 1t may he stated that the charter act
authorizes such consolidation to be made
If the companies themselves choose to do SO;
that the consolidation would seen, to be much
more necessary, for tho conservation OF the
property and securing the Government debt OF
the Central Pacific subsidized line thnn it does
Tor thnt Of the Union Pacific: and that its gen
er.ll effect upnu both trnnsc0ntinental aud
local business would be In the direction OF
lnwer 1ates by reason of reduced expenses.
Yet, should the consolidation take place.
there will still remain tho. qucs-
ton Of diversion Of business to
the route, and its effect upon the
interest OF the Government, as the consoli-
dated company might divert business from the
subsidized line just as much as though no con-
solidation was entered INTO, as subject for the
1ew-making power to deal with
As to
THE NORTHERN Pacific,
the Auditor thinks that no other company is
believed to have stra1ghteT or q more hon
est and honorable record than their books
exhibit; but he crticizes the Company for
having donated such large amount to pre-
ferred stock at par value i'll order to place q
loan Of s., 500, 600 upon the two divisions Of
its road.
Mr.. French devotes comparatively little
space to the important questions of inter-
State transportation. As substitute for
the Reagan and all other pending bills upon
that subject he proposes a law which shall
embody the following principles: That all
common carriers engaged in Transporting pas
sengers and freight from one State OF Terri
tory to another State or Territory of the
United States arehereby authorized to charge
and receive for said service such compensation
as they may tx from time to time, provided
that no discrimination OF any kind whatever
shall be made; that the possible service and
facilities shall be furnished on the same day,
at the same price, for all freight offered, and
in case any common carrier eyades or breaks
this provision the party injured shall have
his remedy in any United States Court hay
ing jurisdiction,