The Memphis appeal. [volume] (Memphis, Tenn.) 1886-1890, 1888-02-25
A Letter from Mr.. Huntington Read
and Placed on File.
He Answers q Question Which He
Did Not at the Hearing.
What Had the Central Pacific Done
Toward Paying It's Debt2
He Attributes the Inability to Meet the
Debt at Maturity to the Falling
on Of the Government
Transportations.

WARRINGTON, Feb. 24.-In response to
an invitation, Messrs. Littler and Ander-
son, Of the Pacific railroad commission,
appeared before the House committee on
Pacific railroads this morning. Commits
s;onor po,,;so,, noe No, ,,.os,',, H.,
,,oo,oa - ~. uss ~ ,,N
Pec,eo ~ ah carry gay before asking MI
Littler to express his views upon the Pa
ci6c railroad question, the chairman pre-
sented and had placed on Gle letter from
Mr.. Huntinoton
,t. U,,,,.;.,.. .,,. III.
- IN us 'e''e'' e"'i' az
.enuon 10 ehe iact tnat nc was prevented
by reason OF interruptions from giving q
full answer in his last hearing to ques-
tion mt as 10 what the Central Pacific rail.
,ooJ hod Jo,,,, ,o,,...a ,,.,,;,,. ~, ~, :.
80. iN - 'v""'u p''.ae ''' W. ~
iia'u'i'y. hest tne coninhittee suppose
that he did not wish TO make answer, he
thinks il advisable las there is a complete
answerl 10 make Il In writing Ue savs
,ha, .,,.,o.., -. =, a. ~,
'"e 49,. 'erro aso' :" ,oe, ~ W.
secretary oil 'he treasury ne pointed out
that the government transportation was
diminishing very much below the amounts
the company had Anticipated when the
co,,roo, Voc on,orod int ,nd ol,ho,ol,
=, - s-
So'nc vi nus company ui'ec'o,s ,hougn. inc
government couid not collect anything
under the act except the per cent. Of the
net earnings and one-half Of the service
that the company did for the government,
yet he thought il best to establish a sinking
fund.
Mr.. Huntington refers 10 the bills intro
duced in 1876, looking TO the return TO the
government OF the unsold land grants in
part payment OF the debt and the diver
sion OF the earnings from the government
transportation for the creation Of a sinking
fund. He says that something OF this kind
would have been acceptable 10 the COM
pany but no action was taken. IL was
fortunate, perhaps, for the Central Pacific
company that its offer was not accepted, as
the provisions would have proved n serious
burden now that the government business
and the net earnings have both shrunk by
the competition of other through lines.
Mr.. Huntington then tells how the di-
rectors OF the company in 1873 resolved 10
create a sinking fund in their own treas
. ury 10 meet its debt. II Is now apparent,
he says, that the money could not be made
\ 20 earn @ per cent, as was anticipated.
Nevertheless a considerable fund would
have accumulated by 1898. More than half
Fthe entire debt would have been paid, and
the whole would have been settled in the
early part OF the twentieth century, after
which the whole net earnings would have
gone TO the stockholders, $50 that whether
my assertion was right or not, would have
made but little difference" says Mr.. Hunt.
ington.
Continuing, he says that the passage OF the
Thurman act followed, and "this, ofcourse.
put an end 10 the company's own yolun.
tary efforts, as We could not pay the money
into the United States treasury and also
invest II elsewhere. Congress then took
the matter into its own hands, and the re-
suit has been 10 impound q considerable
sum in the United States treasury which
ought 10 have been earning or per
cent, but which has virtually earned
nothing, as Il Is today doubtful whether
as many dollars will be gotten out Of the
fund as have been paid into IL by the com
pany.
Finally, II was not possible for the Gen.
trail Pacific company TO repay the United
States loan and the interest upon II, and
at the same time 10 take care OF lis first
mortgage bonds and interest thereon, with
In the short space Of thirty years, unless i
had control OF the traffic OF the territory IL
taversed. When " became clear that
other competing roads TO the Pacific more
liberally aided than the iirst road were
soon TO be completed II was evident that
both the first mortgage and the subordinate
liens must be postponed for very long
time. For reasons which were no doubt
satisfactory TO the government, II impaired
the earning capacity. OF tho road, and
., thereby lis security, Tor this debt This
~r-Fas matter over which the government
had control, and IN equity II ought not
now TO seek to make the impairment good
at the expense oil the party injured by II,
namely, the company"
Mr.. littler ihen said that when the
commission had MED the reports with the
PRESIDENT ils auues were supstahusi,y q,
an end, but that u its members could aid
the committee IN any way IN ieachlng
correct dctermina'lon Oh tne lmportant
question before " hcy Moula mos. VIII
ingly contnpute their enors. OongresS
had had much 70 90 win me question:
now 10 Keep money OUT OF ,ne treasury,
but very httle 70 90 WIN gett,hg ihto th9
treasury money which ,awIuiiy oelohgvu
there. llo Dill urOpOHe0 DIV the majority