Sacramento daily record-union. [volume] (Sacramento [Calif.]) 1875-1891, 1883-11-28
RAILROAD TAXATION.
The following article and letter appear as
here given in the Coluss Sun of the Oath in.

The writer OF this owes A. Montgomery, Cali
| fornia millionaire, sum of money, say 81, 900, on
which he pays interest, and if he claims reduction
on account of any mortgage, the Assessor puts in
Montgomery's interest in the property we hold, so
the State gets the taxes in any event. the value
! OF the property, without any regard to ownership
| or any incumbrance upon it. Now, to place the
railroad company and its creditors on an exactly
| even footing with the writer and Alexander Mont
| gomerv is all he wants. We think Mr. Raymond
knows that if We had all the power of all the Cars
and all the kaisers in Christendom, would not
exact one cent more of the railroad company than
that which, after careful and candid examination.
appear to be just II we not just in any matter
any gentleman can have the use of our columns, to
| go before the same readers, to show wherein we
fail. 1t does not set back any to be proved in
error. All men err, but it is not everyone who
acknowledge error, for truths sake, when salts
| fed that one has been made.-lColusa Sun, Novem-
| Der 18th.
Nor shall any State deprive any person of life,
liberty or property without due process OF law,
deny to any person within its jurisdiction the equal
protection OF the aw.-[Fourteenth Amendment.
Editor Sun note in your issue OF November
18th an editorial entitled "a Railroad Taxes" from
which the article first above is extracted.
You are right when you assert that know if you
had all the power OF the Cars and kasers in the
world you would not exact one cent more from the
railroad company than that which, from careful
and candid examination, should appear to you to be
Just. An intimate acquaintance extending over
quarter of a century with you, gives such conf
dence in your judgment and integrity that would
be willing to-day the State consenting to withdraw
the tax from the Courts, submit them to you
for determination, and accept your Judgment as
finality.
l believe the railroad company is right in the
position which it has taken, and have yet to see
one far-minded man who, after understanding the
facts, does net approve its course.
To resist illegal tax is not only the right, but
it is the duty of every citizen. do uot mean by
this that it is the duty Of citizen to resist tax be-
cause it is slightly excessive out OF proportion
what mean is this That every tax which is levied
in violation CT accepted fundamental principles OF
government should be resisted, and that resist
such is great virtue to bear arms in de.
Tense of lawful and Just government.
You give an instance above and say that all you
to do is to place the railroad company and its
creditors exactly an even footing with yourself
and Alexander Montgomery. That is all the rail-
road company wants. To illustrate You a
farm worth 81 ,000 you owe Mr. Montgomery 81
600 under the Constitution of the State of Califor-
MIA you assessed upon that property for 81 200,
and Mr.. A. Montgomery is assessed for $1,000; if
you pay the tax upon the $4,000 you are entitled to
deduct one half of the amount paid by you from the
debt which is due to Mr.. Montgomery. There is no
doubt but that this is the law and there is doubt
but that this is right. Your partner, Mr. Adding
ton, OWES farm also worth $1,000; he owes Mr.
Montgomery 8, 000 secured by mortgage upon the
farm. Now, suppose the law stood precisely as
have above stated in regard to the transaction be-
tween Mr.. Montgomery and yourself, but as to Mr..
AddingtOn the law should say that the whole value
of his farm should be assessed to bin, and that he
should pay the whole tax without any deduction
from the debt of Mr.. Montgomery would anybody
pretend that yourself and Addingion received the
equal protection Of the law? Would it not be
plain to every person that Mr.. Arlington
was required to pay the Government, for
the same protection which you secure, a
tax upon the same valuation double that which
required from you? But this is not all. Suppose
the law should provide, 1t does, that your pro-
erty should be assessed by local assessor and that
it, after notice, you believed the valuation too
high, you might appeal to a local tribunal before
which you could appear, make your complaint and
be heard and that the other hand, the same
law provided that Mr.. Arlington should be assessed
without notice by State Board Of uazatiOn,
which could assemble at any place in the state, and
before which he had no legal right to be heard, and
whose action was final Would anybody pretend
that this law just, that you and Mr.. Adding
ton stood equal before the law / think not. Yet
the two supposed present the position Of the
railroad company with this exception, that there is
much more merit in the claim of the railroad COM
pany that the holders OF its bonds should be taxed
than there would be IN your case that Mr.. Mont
gomery should be taxed for the amount Of the debt
which you owe 20 him.
You will remember that the Central Pacific Rail.
road was built in time of war, when values were
largely inflated For stance, locomotives for
which it then paid S35, 900 can now be bought for
IS 900 steel rails be purchased and laid
for less money per ton than the Central Pacific Com
pany laid for freight alone on the iron rails which
1t used To state the matter generally, the Central
Pacific Railroad could now be constructed from San
Francisco to Ogden for say about one-half what it
actually cost to construct it at the time il built
This shrinkage in values the railroad company has
to bear, but it ought, in justice, to bear more
Now on the the other hand, its bonds sold,
including the bonds guaran' eed by the United
States, average of not less than forty per
cent. below their face value. These bonds in the
hands of the bondholders have not deprecated, but
on the contrary, the Federal bonds worth about
thirty-four per cent. premium while the company's
bond are worth at least fourteen per cent premium
While the property OF the company in the general
sh1ukage, which followed the and the resuinp
ton of specie payments has shrunk in value about
fifty per cent, the property Of the bondholder has
in the case increased nine yfOur per cent. and
in the other fifty-four.
In view of these facts, I assert without fear of
successful contradiction that the discrimination
made against the company by the system Of taxa
ton provided for in the Constitution is just,
and is more marked and Unfair than the discrmina-
ton which would have been made had the law as to
Mr.. Addington and yourself been above stated.
Are you prepared at this day to say that there
should be one for what you are pleased to call
powerful corporations and another law for that
class which you term the poor? | do rot believe
that you are prepared to take this position, yet
every argument which you advance tends in that
direction
| have maintained in these tax cases that there
should be one law in the land, and that that law
should be administered equally with respect to
every person within the jurisdiction. have never
proposed to compromise any tax | have denied
from the very beginning the validity OF the proyi-
sions of the State Constitution and have asserted
that they in fragrant violation not only Of the
Federal Constitution, but also OF those great govern
mental principles which require that the awG should
bear equally upon every person within the Jurisac-
tion OF the Government.
During the canvass which resulted in the sdop-
ton of the New Constitution, most Of the eminent
lawyers who opposed its ratification by the people
took the same view OF the question which the rail-
road company have since maintained.
The railroad company has at all times been willing
to contr butte it's share towards the support Of the
State and county governments, and from the very
hos
as you put it, endeavored to make its own assess
ment, but has offered voluntarily to pay to the
State and counties sum greater than was ever
levied as tax upon similar property in any State
in the Union either in peace or in war.
The idle talk which has been current Il acquit
you, however, Of it) about the railroad company re-
sisting the law, seeking to assess ITSELF and setting
itself above the law, has no better foundation to
rest upon than the fact that the railroad company
as any citizen might do has gone into the Courts Of
the country under the shield of the Federal Con-
sttution and Questioned the validity OF the Consti
tuition Of California in relation to revenue
II the decision Of the tribunal to which the Con-
sttution of the United States has intrusted these
questions shall be aver5e to the position taken by
the railroad company, it will cheefuly acquiesce IN
that judgment. That the decision will be in favor
Of the railroad company have always believed.
do not thuk that the august tribunal can even di-
vide upon the question whether the railroad COM
pany has received the equal prot elton of the law.
One Of the learned Judges who decided the Santa
Clara says in his opinion that this case as well
as the San Mateo case has been eborously prepared
and deliberately argued by eminent counsel, and If
the industry OF the Acknowledgement and large
number of attorneys and special counsel for the nu
merous counties interested in the question has
lied to find any recognition OF the principle which
they are endeavoring to maintain, either in the
practice Of the several States in the textbooks or
decisions, or even dic'a Of the Courts think it
will be safe to presume that none be found"
There is no precedent in the Jurisprudence OF
civilized countries for the discrimination attempted
to be made against the railroad company, nor is
there, to my knowledge, any precedent for the &C
ton OF the railroad company under the circum-
stances. Notwithstanding the fact that it was ad-
yised by most eminent counsel that these taxes
invalid and could be collected notwithstand-
ing the decision o. the Circuit Court OF the United
States it has already paid million Of dollars
TO the State and counties and has offered to pay
another million. II would be well for these whoare
| criticising the action Of the railroad company TO
look around ami see what other corporation per
son has ever paid voluntarily such sums of money
| upon 4 claim clearly Illegal and uufounded.
| believe that II the Fourteenth Amendment to
the Federal Constitution is rightly interpreted and
faithfully executed, the result viii be that no egis
! lative assembly in America can give to one person
sny right, pri ilege thing without extending to
every person within ts jurisdiction the right have
| the privilege or thing, under the same circum-
stances. That legislative assembly in America
will be able to take from one citizen any right,
privilege thug which it does not, under the same
| circumstances, take from all.
| When this shall be accepted a the correct inter
| probation of that great amendment, and conscien-
houra