Wichita eagle., 1888-02-09
THE UNION PACIFIC RAILROADS.
INDEBTEDNESS.
The Government Directors of That
Road. in Their Annual Report.
Explain the Situation
Now Existing Between the Governments
as Creditor and the Railroad Com
pany, as Debtor.
Many Petitioners Appealing to the Com
missioner of Agriculture for the
Retention of Prof. Dodge.

WASHINGTON, Feb. S.-The government
directors of the Union Pacific Railway
company have submitted their annual re-
port to the secretary of the interior. The
report begins by calling attention to the
Importance of having an early and definite
settlement of the subsidy debt of the COM
pany on basis of greater security to the
government. and which should be within
the ability of the company to meet.
The report. after referring to the liable
and exhaustive report of the commission
appointed under the act of congress March
3, 1851 continues: We cannot too strongly
urge the great harm which delay is doing,
both to the Union Pacific and to the
security of the government debt.
Every consideration which we can
believe is pertinent to this subject, urges
its immediate settlement. The plan pre-
scented by the report of the committee con-
tains some new figures which strike the
directors OF the Union Pacific railroad ia
uorably, and to which they Will briefly
call attention. The suggestion of "A mort
gage to secure bonds to be given by the
company is fully endorsed. The provision
of the commissions plan which makes
possible at the option OF the government
some actions against those persons who
may have tempered with the property of
the road. and thus diminished the security
of the government is eminently proper. To
what extent any effort to have justice done
after so long period may be effectual,
the board will not attempt to discuss
This GU stion is one of importance and
should not be left for decision to the legal
adviser of the government, if the time shall
arrive when ii may be placed before him
To leave the company free to attend to its
own business and as part OF this plan to
abolish the Office of government directors
and to make the government in all respects
an ordinary mortgage creditor and the
company ordinary debtor, so long as the
provisions of the act are carried out, meets
with the approval of the board and has
been a prominent object in the plans
hitherto recommended. With the security
made practicable and greatly increased
with the gradual reduction of the debt,
and with the provision for foreclosure
constantly ready to act, the government
can well afford to let the stockholders
conduct the affairs of the property as other
railroads are conducted and especially in
view of the notorious fact that its present
relationship to the government is nothing
short of miSchieyouS and destructive The
government directors do not propose to
discuss at any length the plan sub
mitted by the minority report of the
commission, the objective point of which
is not SO much the recovery of the money
due the government as the punishment of
those who are supposed to be guilty of
having unlawfully diverted the money of
the company. Our business is with the
Union Pacific railway alone, and as that
company wishes to pay its debt to the gov
eminent, and as we foresee that the debt
can be secured and collected, our interest
lies with our duty in confirming ourselves
to the business considerations that are in
volycd. If, however, the government
directors are at liberty to express any
opinion as to the desirability of the course
recommended by the minority report, they
do not hesitate to say they would view its
adoption with deep regret. Indeed, if this
were the only alternative it would in our
Judgment be better for the government to
lose every dollar of its debt and execute
release to the company 1t is respectfully
submitted that whatever may have been
the wrongs done by individuals in their
dealings with the Union Pacific. such
wrongs should be atoned for by those indi-
viduals themselves and by them only.
To punish and destroy the corporation be
cause some time in the past it may have
been desperated by those who We're bound
in law and in conscience to protect it, does
not appear a logical method of enforcing
justice, nor such a conception of justice as
would increase the respect of the people
for the law of the land
The government directors deem it unneces-
sary for them to enter into a detailed ac-
count of the operations of this road dur
ing the past year, the reason being that
the act of congress of March 3. 1887, vests
the commission with the power and makes
IL its duty to examine thoroughly and lie
port upon the financial and executive ad-
ministration of the Union Pacific railway
company: and the commission having thor
oughly done this, its report gives all the
information necessary In Stunning up
their opinion of the administration of the
Pacific Railway company the commission
say: We refer to the admins
tration of the Union Pacific
Railway company; since the spring of
1894, in our Judgment, ii is fully and en-
tirely eXonerated from the condemnation
to he passed on the transactions of other
roads. and relating TO other periods. We
are satisfied that this administration has
devoted itself honestly and intelligently
TO the herculean task of rescuing the
Union Pacific railway from insolvency,
which seriously threatened it at the in
ception of its work: that it has devoted it
self 10y rigid economy. by intelligent man
agemene, and by an application of every
dollar OF the earning capacity OF the system
TO Its Improvement and betterment to
place that company on R sound and endur-
ing financial foundation The effort has
increased intelligence and vigor, and we
think it to be largely due to this admins
tration that the United States today in our
Judgment holds in the Union Pacific and
through the value which il derives as an
integral part of the Union Pacific system.
Gf protected by proper legislation, full
security for the repayment of its whole
debt and of the interest. 1t gives the gov
eminent directors pleasure to ex-
press their appreciation not only of
the ability and wisdom, but of the spirit
of justice and fairness which prevades
the report of the commission, and of the
courage with which it renders the Justice
which is due TO the present administration
of the Union Pacific Railway company,
which, so far from impairing the interests
of the government, has conscientiously and
with signal ability protected and promoted
the interests of the government, which I'M
der honest administration are identical
with those of the company.
1t Is fair to expect that such a conclusive
report coming after an uninterrupted series
of similar recommendations and reducing
the general proposition TO its very best form,
viii have enough weight with the congress
of the United States to lead to an imme-
date settlement with the Union Pacific
Hallway company of its enormous debt TO
the government, and at the same time put
ting an end to the strained and anomalous
relations that have heretafore existed be-
tween them to the detriment Of both
Signed by A. c. Haskell. Franklin Nc
Neagh, James W. Savage. Frederick r.
Coudert NJ. A. Handa, government di'
rectors Union Pacific Halfway company,
January p, 1888.
MINOR GOSSIP