The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1888-01-18
Accompanied by Long Message Favoring the
Recommendations Made by the Majority
of the Commission of Inquiry.
Speaker Carlisle's Physician Thinks His
Patient Is Not Dangerously Ill.
The House Elections Comittee Formally Re-
ports Against the Claim Made by Th@ba :
Other Items of Washington News.
THE PACIFIC RAILWAYS.


Presidents message transmitting the Pacific
railroad reports to Congress:
ITO the Senate and House Of Repre- sentatives:
.'On the Sd day of March last en- act was
passed authorizing the appointments of three
commissioners who should investigate tha affairs
OF such railroads as bave received aid from the
United States government. Among other things,
the con ptempated Investigation included q his
tory OF the construction of these roads, their
lations and indebtedness to the government, aud
the question whether. in the interest Of the
United States, aEy extension Of the time for the
performance of the obligations of said roads 20
the Goverpment should be granted; and. il SO.
the said commissioners were directed to submit
scheme for such extension. The commission
were further directed by said act to report ia
full to the President upon all the matters sub
mitted to them and he was by said act required
to forward said report to Congress with such
recommendations or comments al he should sec
ht to make in the premises
1.-The commissioners, Immediately after their
election, entered upon the discharge of their
duties. and nave prosecuted their inquiries with
tSnanns eSmmendanis Industry. industry in.eilisenee and
has been taken. and all the facts have been
developed which appear to be necessary for the
consideration of the questions arising from the
condition of these aided railroads .nd their rela-
tions to the government The commissioners
have. however. been unable to agree upon the
manner in which these railroads should be
treated respecting their Indebtedness TO the
United States, or to unite upon the plan beet
calculated to secure the payment Of such in
QeDCneSS. his disagreement has resulted
the preparation of two reports, both of which
are herewith submitted TO the Congress.
sThese reports exhibit such transactions and
schemes. connected with the construction of the
aided roads and their management, as suggests
the invention of such devices the part Of
those having them in charge for the apparent
purpose of defeating any chance for the govern
ment's reimbursement; that any adjustment or
plan of settlement should be predicated upon the
substantial interests of the government, rather
than any forbearance or generosity deserved by
fhn opfo IhA do, hi,autt ~ H.
already been given to the substance of the COM
missioners' reports obviates the necessity of de-
failing in this communication the facts found
upon the investigation. The majority report,
while condemning the methods a6ooted by those
who formerly had charge of the Union Pacific
.ailroad, declares that since its present man
agement was inaugurated in 1884 its affairs
have been fairly and prudently conducted,
and that the present adml luistration has
the herculean task of rescuing the Union
Pacific Railroad Company from the insolvency
which seriously threatened it at the inception OF
it's work; that it has devoted itself by rigid
economy, by intelligent management, and by an
application of every dollar of the earning cApac-
ity of the system. to its Improvement and bet
torment. to place that company on sound and
enduring financial foundation. The condition
Of the present management of the Union Pacific
Company has important bearing upon its
ability to comply with the terms of any settle
ment of It's indebtedness which may be offered
by the government The majority of the COM
mission are in favor of an extension of the time
TOT Lne payment OF tho government indoOted~
ness of these companies upon certain conditions.
but the chairman of the commission. presenting
the minority report, recommends, both upon
principle and policy. the institution of proceed
ings for the forfeiture Of the charters of the
corporations and the winding up OF their affairs
II have been furnished with q statement, or
neeted With the construet'on Of she Csn,ral pa
cifc road and its branch lines from which it
may not be amiss to quote for the purpose or
showing how some of the operations of the di-
racf ~ e1ch dc 0o1v hxp
the commissioners are defended by the directors
themselves After speaking OF a contract for
the construction of one of these branch lines by
a corporation called tho Contract and Finance
Company, owned by directors of the Central
Pacific railroad. this language is used:
'It may be said of this contract of many others
in which the directors of the Central Pacific have
been stockholders ehat they built the road with the
their outlay In other words. they paid to the con.
struction company the bonds and stocks of the rail-
they could develop sufficient business the rosd
built to induce the public to buy the bonds the
developed sufficient business then the project was a
if it did not then the operation was loss.
occurring necessarily theirs, and OF right the
profit belonged to them. But it is said that they
dealing with themselves; that they were trus-
tees, and that they were representing both
not find anybody else to deal with. They could not
find anyone who would take the chances of building
=
country and accept the bonds stock of the road
in payment. And when it is said that -hey wsrs
merely technical for they represented only their
own interests on both sides. there being else
corporators of the company that build tho
road subscribed for its stocks and the only sub
was wronged By their action. The, rul. Of equity
involved which has its origin in the injunction No
to them because they were acting in their own inter.
ess and charged with the duty of caring for
others rights there being other interested
in the subiect-matter.
I'm view OF this statement and the facts de-
veloped in the commissioners report. 1t seems
proper to recall the grants ana dement's asrived
Union and Central Pacific companies for the
purpose OF aiding the construction of their
roads. By act passed in 1862. twas provided
that there should be advanced to said companies
by the United States. to aid such construction,
the bonds of the government amounting % $l6,-
600 for every mile constructed as often as
section of forty miles of said roads should be
built; that there should also be granted to said
companies, upon the completion OF everv said
tions of public land for each mile so built; that
the entire charges earned by said roads on ac-
count OF transportation and serviog fot
the government should be applied to
the reimbursement of the bonds ad.
vanced by the United States and the interest
thereon, and that 70 secure the repayment
and delivery to said companies of said bonds
should constitute . first mortgage on the whole
line of their roads, and OF their rolling stock,
fixtures and property of every kind and discrip
tion. The liberal donations, advances and priv
ileges provided for in this law were granted BY
the general government for the purpose OF so
curing the construction of these roads, which
would complete the connection between our
Eastern and Western coasts, and they were
based upon a consideration OF the public bene-
fits which would accrue to the entire country
from such construction But the projactors OF
these roads not content, and the senti-
ment which then seemed to pervade the Con-
gress had not reached the limit OF its generos-
isy. Two years after the passage OF this Law is
was supplemented aud amended IN various I'M
portant particulars in favor OF these companies
by an act which provided. among othsr
things. that the bonds. at the rate already
specified should be delivered upon the compile
tion OF sections OF twenty miles In length In
stead of forty that the lands to be conveyed 70