The Iowa plain dealer. [volume] (New Oregon, Howard County, Iowa) 1867-1895, 1882-08-31
Il NICE LITTLE BILL"
A Game Of Euchre Between the
Railroads and Uncle Sam.
The Bill 10 Further Regulate the In
yeStments OF the Pacific Railroad
sinking Fund--t;ivlng Up
Security for Fifty MIL
lion Dollars for
Nothing.
From New York Truth.

Monopoly members were impotent to
prevent the passage at the last session
Of various jobs. they nevertheless sue
ceeded in successfully antagonizing the
consideration. and doubtless the passage
by the House, Of certain railroad meas
ures in which these corporations were
peculiarly interested. Among these
was, perhaps, the largest Of all the Con-
gressional efforts at plumber, the bill to
further regulate the investment OF the
Pacific railroads sinking fund, which
passed the Senate July l, last.
In reporting this bill from the Finance
Committee, Senator Morrill, stated that
there was about $500 900 received from
each OF these railroad companies now
lying idle III the treasury in consequence
Of the protest on the part of the COM
panies against buying bonds at high
rate Of premium, and that the pending
measure, which directed the investment
Of the fund in the first-mortgage bonds
OF the Pacific railroad companies, had
10 ,eived the approval Of Secretary Fol-
ger.
But Senator Morrill, further stated that
he wished to call attention to the very
iarge amount which the Government
had already advanced or pledged itself
to pay, amounting to over SO, 600, 600,
for each Of these companies /; and also to
the very surprising statement Of the
amount invested by the Union Pacific
road. since 1879, in the bonds and stocks
Of other corporations. The amount in
1879 was 1925 900, while in 1881 it
had invested S28, 735, 600 in stocks and
bonds of other corporations. The Sen
ator added, very significantly, that it
seem, d astonishing to him that the Gov.
rnment had not been able te obtain =
larger amount Of the debt due it from a
company which had been able, in two
years, to increase its investment iu stock
and bonds Of other companies from over
81, ,00O, 900 to mere than S2S, ,OOO, 900.
''Black Horse Brigade" attempted to
take it from the Speakers table and put
it on its passage without reference to
committee, and the effort would have
succeeded but for the vigilance of few
Anti Monopolists, who, suspecting an
African in the wood pile, interposed OBJ
| lection. Up - the very last hour Of the
session these faithful few kept viRilant
watch and ward upon this bill, aud, al
though it was sought to be sneaked or
accommodated through, time and time
again, the session adjourned with the
measure happily unactel upon.
This money is III the tr. asury, but
has not been invested in Government
securities, because, forsooth, the rail-
road companies protested against the
purchase Of Governm. mt bonds ut high
rate OF premium. II issomewhat surpris
ing that such protest SHOULD have been
noticed, considering that the moneys are
the property Of the Government aud not
q the railroads, AMI no wonder, there.
fore, that Senator Morrill, should have
been astonished, il not indignant, that
the Government could not obtain lar
ger amount Of what is due from com.
pany which manages to invest over SaS.-
OoO, 900 surplus in three years in the
stocks and bonds Of other corporations
The explanation given at the treasury
Department tor the recommendation to
invest the sinking fund in the first mort.
gage bonds Of the Pacific railroad COM
panlesis peculiar. aud dpointsa large-sized
moral, without in the least adjoining a
tale. When Government aid was ex-
tended to these roads frst-mortgage
lien WAS retained, but under influences
which are open to grave suspicion Con-
gress subsequently released the first
lien TO the companies aud accepted u
second. In other words, it gave ap its
only immediate security for the repay.
ment of some $50, 600. 900, and tool,
nothing IN return.
After considerable trouble and litiga.
,ion these roads we're finally compelled
to contribute percentage from their
earnings for sinking fund with which
to extlngnish the debt-a consumma-
ton from which they vainly endeavore,i
to escape. The treasury officials, being
stampeded 10y the protests Of the com
ranies from investing the amount Of
sinking fund on hand in Government so.
curities, say that the only way the Gov.
eminent can now be made secure is to
purchase the tirst-mortgage bonds oi
tho companies now at about 20 per cent.
premium. Thus. having given up the
first lien, the Government must buy il
back again in order to he secure.
The further explanation is made nj
the treasury that it il better invest
Dlent to purchase 7per-cent Pacific
railroad bonds ut 20 per cent. premium
than 3per-cent Government bonds al
par. But there are several Anti. Monopo
lists in Congress who incline TO the
opinion that the Government bond i.
the better security, no matter how sma
the interest: while Others insist, ~ !
precautionary measure, that they woul,
rather have tho money lie idle in tn,
treasury than invest in any OF thes,
railroad securities, which might take |
tumble or - wrecked some tine day il
the stock market. They know what v,
have got now, bat not what we ma,
realize or los. IN the future, and henc
oppose any indirect dahbling in stock
by the Government.
The benefits TO lie derived by inves,
ing the sinking fund in the tirst-mor,
gage hoa.is uf the companies are easil
seen. Tie fact tina. the Government
invested its moneys III these securities
, it i, believed, would enhance their vain
i'll the mas ket ut least L per cent. Th
holders OF tl,ese securities, to the amouil
of say SIT. 100000. thus realizng an u !.
, vance OF ID per cent, would simply In
, S5,anl, ,otA clear and clean. But. SUI
posing. violently. that The Gosernm...
investment did not enhance the mark.
!. value of these bonds. would 1t .ertaln
, have the effect Of keeping them frol
: depreciation beyond the usual nuctu,
.. tions of Government bonds.
The passage OF this bill, therefor,
ieopardizes the MONEYS of the sinkin
iund by placing good money wnere
NIGH. prove lad, puts 81. oOO. 900 in IL
hands ot the owners uf tie bonds IN
..nas the credit uf the Grove, ument twit
, ] u. 4 tn r.llI,nl rurln,rull i MS the as.cull