New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1890-12-05

in Office In his second term in June, 1873. vice.
President John Duff acted as president from 'na'
time till the annual election in March. 1879.
VIII.
The way in which Jay Gould came int uc
company Is best described in his own articss
Language on the witnessstand. He said:
F" In the spring Of 1873 / met Mr.. Clark thorace
F. and Mr.. Schell at Chicago. Mr.. Clark was
president Of the road, and he and Mr.. Shell hao
been out over 1t and were on their return UP.
And they spoke SO highly Of the property tnat 10
induced me to send an order down to New'iork
to buy that stock. / was on o trip over the Onr
cago and Northwestern, and / sent an order down.
/ think, to begin at 35 and buy the stock ouy
it on q scale down. Well, it seems that Mr.. clark
was then ill. He returned. and when L
was of up in the woods he grew worse; anu MS
brokers discovered that he would have 10 die'
and they took the opportunity to sell his s'och'
and my orders caught it. After l got home 'no
stock kept going down. and / got alarmed about
it and began to inquire into the condition oil the
property, and finally ! met Mr.. Alley, and asked
him what was the trouble with the Union ra-
cifc. Why he said, there was trouble enough.
They have got an immense floating debt neins
carried at enormous rates-sevcral million dollars
u tuCy udNc ROb PtD.VVO,VOV "a hS"
coming on very soon. And he said he did not see
how the company could avoid a rcceivership. Or
course that alarmed me. The stock had got down
to about IA. and / inquired to see what directors
there were that would help to stand by the prop
erty. ] soon discovered that Oliver Ames anu
Sidney Dillon were the two that could be rened
on. They had a large interest in the stock L
sent for them and had an interview with them.
We took I'D the financial condition of the com
pany. | found that the directors had been charg-
ing a commission for indorsing, and that the
notes were carried at very high rates of interest.
| protested against that, and said | would stand
in and take my share of the notes, and we were
to put it right down TO legal interest. We dld
so. Shortly afterward / made a further propo-
sition that we should fund the floating debt and
I think I took q million of the bonds above the
market price,
He had accumulated 100, 900 shares of the stock
II he had done this with the view Of wrecking'
the >-operty. he must have thought as he looked
about him that the margin Of salvage was ex-
small n he got ashore himself ne was
lucky.
Boston people are provcrbially shy and dlhcuit
of approach, but in very deep water where they
could not swim they have been known to take a
life-preserver from an entire stranger. In lmml-
nent peril, on a lee shore, they would no oouDo'
though perhaps reluctantly and with mental reser-
~yations. take a lifeline from a smuggler.
The stock was extensively held IN Boston, large
blocks Of it being original holdings. 1t did not
take these stockholders long to discover tnat Slr.
Gould was likely 10 make a serviceable ally. They
knew he had great wealth, and they found that
he had besides a mind fertile In expedients,
ready in emergencies and comprehensive In ie
grasp Of affairs. They did not hesitate to give
him undisputed control.
So, at his suggestion, Sidney Dillon was made
president in March, 1874, while he himself took
an inconspicuous seat at the board, with a lively
consciousness, however, on the part OF
his associates that where McGregor sits is
the head of the table" Under his manage
the company began paying dividends in
1875, which it continued till April, 1884, in which
S2s, $50, 900 was returned to the stookhold-
en, the stool; advancing meanwhile from IA to
1871 ga in July, 1891. Since he retired there
have been no dividends and the stock hos sold as
as 20.
Not long ago the Boston financial writer's were
saying that In view Of their experience of Gould
ISM the New-England stockholders in Union Pa
cifc did not contemplate with much satisfaction
the return of that gentleman to the control Of the
property. Doubtless the statement was made
consultation with the stockholders.
TX.
As 1t grew rich the company grew saucy. It
put on a lofty tone toward the Government and
its representatives, made its interest payments
grudgingly, resorted to subterfuges and techni-
~calities, involved itself in litigation with the Gov
ernmenu and an angry quarrel with Congress, and
as generally obstreperous as the mule that
" forgot his father was a jackass." Congress,
never over-friendly to the company since the
Mobilier exposures, grew more and more
exasperated at its contumacy. In such a quarrel
it had all the advantage. In 1873 it confiscated
act and forbade the payment of a single dollar to
the company on Government account.
The completion of competitive lines compelled
reduction Of rates and led to diminished net earn
ings, which began to fall of in 1883. A thor
oughE organized bear raid upon the stock began
in 1883, which was sensibly promoted by the in
Of a number Of hostile bills in both
branches of Congress.
Mr.. Gould knew the temper of Congress and
was not entirely unacquainted with the situation
in the Street" He was not caught mapping.
He began to dispose of his stock and get ready to
40 dolOIt. IL a ~ Ia hs " 8NAeS
way:
Il made up my mind that it was better for this
property to have a large scattered ownership. as
long as they said-the newspapers and everybody
that it was Jay Gould that controlled it. The
property seemed to he handicapped, and / made
up my mind it was better to get in a large number
of investors scattered around through the differ
ent States-the talk was that they would take
care of the property-rather than to have 1t said
that it was owned by one man. / had formed
that resolution deliberately, and wherever l saw
a market where | could place the stock / pursued
that policy. That was what governed me. /
did not like to he in partnership with the Govern
ment. 1t was constant turmoil and quarrelhng,
and the moment you took this property and made
q dividend, paying which we did by our hard
work, working night and day, then the Govern
mcnt came in and began to attack u.s. That tired
me out"
So by the end of the year 1888, when the stock
was ruling in the peighborhood Of 30, Mr.. Gould
had given his large holdings a scattered owner