Savannah morning news. [volume] (Savannah) 1868-1887, 1884-08-06

Il
one of the things that ought to be
brought prominently before the country
during the present campaign is the
Union Pacific Railway swindle. 1t has
no parallel in the history of the country.
It ought 10 be explained clearly to the
people because Republican adminlstra-
tons, by the failure of their leading men,
bers to do their duty, have permitted the
government to be cheated out of millions
Of dollars. The original owners Of the
Union Pacific put into it only Sis, 900, or
10 per cent. of p, 800 shares. The govern
ment gave the road 120 square miles OF
land for every mile of road constructed
1t also loaned it bonds to the amount OF
Of So, 600 per mile. and authorized 1t 10
issue first mortgage bonds to Ike
amount. The original owners became d.
rectors, and they contracted with them
selves under the cover Of the Credit Mo-
bilier to build the road. In this way they
pocketed S44.OOO,OO0 They made con-
tracts which Melted profit Of
from 100 to 800 per cent. When
their swindling operations began to at
tract the attention of Congress, bribery,
10 hush up luNESAA-hAAuIs " tAo ACSSA tCN w.
and the Credit MOblIier scandal was the
result. In 1873 Jay Gould saw fine
chance to reap rich harvest.
lie was a large owner in the
Kansas Pacific. which was not paying ex-
penses. The Union Pacific at the time was
not only paying expenses. but also large
dividends. Gould obtained a controlling
| interest in the Union Pacific, consolidated
| it with the Kansas Pacific, and thus made
| the Kansas Pacific securities, which were
almost Yalueless, worth nearly par. Not
only was this done, but, in defiance of
law, S47,O0O,O00 of Indebtedness, in the
4 shape of bonds and stock, was issued and
/ pOcketed by the wreckers. The govern
ment all this time was getting no inter-
est on its bonds, and no hing was being
| placed in the sinking fund to pay the
/ bonds when they should become due.
! During Hayes administration Senators
Edmunds and Thurman, in order to bring
the Union Pacific company to terms, sue
ceeded in getting the Thurman actpassed,
which provided, under heavy penalties
an absolute forfeiture of the charter if
not Obeyed, that % per cent. Of the net
earnings and the whole Of the receipts
from government transportation on the
| subsidized lines should be turned into the
sinking fund, in addition to the5 per cent.
demanded by the charter, and that no
dividend should be paid until these re-
quirements were duly satisfied.
The company did not comply with this
act. 1t virtually ignored it. 1t declined
to make any payment to the government
unless certain counter claims, which it
set up, were allowed. The counter claims
had little or no foundation, and were only
intended to assist in avoiding the pay
ment Of what was due the government.
What was the Attorney General doing all
this time. Nothing, absolutely nothing.
His inactivity gave ground for suspicion
that he sympathized with the company.
His conduct was severely criticised by
leading members of Congress. The Senate
demanded, somewhat imperatively, to
know why he had not enforced the Thur
man act when it was notorious that the
company was paying dividends contrary
10 the terms of the act. He replied that
he had not taken steps TO indict
the directors Of the company and forfeit
its charter because he did not think the
time favorable for such steps. OF course
the Attorney General knew, as the dlrec-
tors knew, that as the counter claims OF
the company were pending in the Court
of Claims no settlement was possible for
several years. At the beginning of the
last session Of Congress Senators Ed
munds and Garland took hold of the
matter with a yigOr that alarmed
the directors of the company.
The Judiciary Committee of the Senate,
to which these Senators belonged, pre-
pared a report which showed that Sl9,000,-
600 in dividends had been paid since the
Thurman act was passed, and that not
one dollar had been paid to the govern
ment. The report not only directed the
Attorney General to proceed at once
against the directors, but also provided
that any director who received
any dividend, or voted to pay any
dividend, until there was full CON-
pliance with the Thurman act,
should be liable to a fine of $4,000 and
imprisonment for one year. This brought
the company to terms. Charles Francis
Washington and begged for delay. He
argued that to have such report adopted
by Congress would cause a panic in Wall
street. He plead so earnestly that delay
was granted, with the understanding,
however, that Dillon should cease to tie
President of the company and that
Gould should get out of the directory.
This understanding was carried out.
Charles Francis Adams became Presi-
dent. and he, in consideration of further
DELAYS in making the report, paid the
amount, S7lS,S14, claimed by the govern
ment under the Thurman act for 1888,
and also agreed that no more dividends
should be paid until the claim of the gov
eminent, amounting to S52, 900, was
paid. In view of the fact that the earn
ing power of the road has been greatly
reduced by the construction of Compel
ing lines, it is not probable that the
company will soon pay another dividend.
The entire debt of the road is stated to be
1892. 900, 000-a sum sufficient to build
three such roads. Had the government
officials been thoroughly honest and COM
petent the government would have had
/ what is due it long ago. 1t is hardly
/ probable that this is the only instance in
which the Treasury has suffered since the
Republican party got control of the
/ government. Is it not about time that
the people should know what the books Of
/ the Treasury show?
|
| The New Orleans Exposition.
The scope of the New Orleans Ex-