Sacramento daily record-union. [volume] (Sacramento [Calif.]) 1875-1891, 1888-03-27

lhat judge Field Is Californian, yet many
insist that the dearth of judicial timber in
Democratic ranks will compel an appoint
ment without regard to location.
THE CENTRA AZ PACIFIC.
Senator Stanford Makes an Argument
Before a Special Committee.
WASHINGTON, March 26th.-Senator STAN
ford to-day submitted an address to the
Senate special committee having charge OF
the reports of the Pacific Railway Commits
sion. He said he desired to emphasize q
single statement which would sufficiently
answer all the vituperation that has been
cast upon the builders of the Central Pa
ci6c road. He wished the committee TO be
entirely divested of the prejudice which
the false stories about the construction of
the Central Pacific left in the minds of all
who had heard them.
The statement which he wished the
committee TO understand thoroughly was
that the Central Pacific Railway Company
had fulfilled every obligation to the Gov
ernment and the people imposed on it by
the Act of Congress creating it. In not a
single instance, said he, has it been dere-
lict up to this hour. 1t has been mindful
of every duty it owed both to the public
and to the Government.
He then detailed what the obligations
were that the Act of Congress imposed on
the company. The first one was that the
road should be built and that it should be
completed by July l, 1876. But, by put
ting forth extraordinary effort; by hesi-
tating at no expense; by giving the highest
wages paid in the whole country: by work
ing on mountains in the dead of winter,
through snow twenty feet deep; by ex-
hausting every resource to push the road
across the Nevada Desert. the work was
finished in 1859, seven years before the time
set by Congress.
That is how the Central Pacific fulfilled
the first obligation imposed upon it by
Congress, but the company doubled the
cost of the road by this exertion, the full
burden of which it had to bear, while the
Government saved by the reduced cost of
transportation of military stores and mails
up to 1S76-when the Act of Congress con-
templated that the road should be finished
more than the company received in gold
for the sale of the bonds received from the
Government.
The second obligation imposed by the
Act of Congress- was that the Central
Pacific should pay FIVE per cent. of its net
earnings to the United States from the
completion of the road and thereafter.
This obligation has been performed fully
and consoientiously from the day the last
spike was driven.
The third obligation imposed BY Con-
gress was that the Government should
have the use of the road for postal, military
and other purposes. This has been granted
in the fullest sense of the term. The COM
pany has performed generously and
Immediately every requirement of the
Government. Every officer appointed to
inquire whether each letter of the law had
been observed has reported that company
i'll default in nothing.
The fourth obligation imposed by Con-
gress was contained in the Thurman Act
and wnen the original contract was changed
by the passage of the Act (Which the Cen
trail Pacific believed violated every prin-
oiple of the laws of contracts. it being
advised that the alteration of the original
contract by the Legislative Department was
beyond its authority and that the Act was
invalid), submitted the matter to the Courts
and when the Courts sustained the validity
of rhe Act the Central Pacific complied
with it, and is still complying with it, al
though to the great deiriment of the cor
poration and the Government.
In reply to question asked by the Chair
man as to the effect of the Thurman Act
Senator Stanford said: at disappointed
its promoters. The method of investing
the fund was failure. Even if the bus
iness had not fallen off by reason of CON-
peting lines, this defect in the bill would
have rendered it worse than useless. The
fund has not been accumulated. The Sec
retary of the Treasury has invested the
money IN Government bonds, paying an
average premium therefor of 34 per cent
There has been paid in by the Central Pa
o,E n ! A. no
1856 600 the loss on which, up to August,
1887, was 81 6l2 $685. In fact, all the inter.
est on the fund has been lost, and for all
practical purposes there is less money in
that sinking fund than the amount paid in
by the company by over S500,000. This is
the history of the company in its dealings
with the Government. In performing
every detail of its obligation it has been
scrupulo sly fai hful"
Senator Stanford said he would not speak
of how the Government had acted toward
the company although it had dealt rigor-
ously with it, harrassed it in numberless
ways and forced new contract upon it
against its will and to its great detriment.
He next directed the attention of the
committee to the rumors that the builders
of the Central Pacific had made vast sums
of money at the expense of the Govern
examined the financial history of the great
enterprise without prejudice would treat
these stories with disdain. The Govern
ment gave the company in bonds S27 $780,
$50, which were sold on an average for rs
cents on the dollar and which brought the
company only $40. AS, ,466. The company
also received for the sale of its own first
mortgage bonds about the same amount.
making the total received from both classes
of bonds about $4l ,000, 600. Every cent of
that amount was spent in the construction
of the road.
Senator Stanford said that all the values
that the company has had and whatever of
wealth it has gathered has come from its
own creation. Every dollar of Govern
ment bonds, and every dollar of first-m mort
gage bonds went into the construction of
the road. The building of the road de-
veioped the country and created great val
ues. 1t was by creating values where no
values existed before that the builders of
the road gathered their fortunes
Senator Stanford said that the agreemen
between the Central Pacific Railway Com.
papy and the Government constituted a
contract. Each party to the contract con-
venanted to perform certain things, and all
those things which the Government agreed
to give the company were to become the
properly OF Ine company and absolutely
subject to It's disposition. IF the company
built and maintained the road held il sub
ject to certain Government uses; paid to
the Government FIVE per cent of its
net proceeGs. and allowed the Govern
ment to retain one-half of the value of
charges for Government transportation, it
fully performed its contract. II the COM
pany had given to charity all il received
from the Government. or had sunk it IN
the ocean, all that wonld have been the
right OF the company. SO lar as It's relations
with ths Government 3re concerned. All
the Government had legal or moral right
to claim was that the company
shonld perform the obligations OF
its contract That it has done
nom the day of its organization
down to The present lime. The Central
Pacific has performed every obligation
public and private, which it ever undertook