The morning call. [volume] (San Francisco [Calif.]) 1878-1895, 1892-01-27
THE SOUTHERN PACIFIC DEBT.

A Democratic contemporary throws ont
the intlmaton that the Southern Pacific
Railroad Company will adopt a policy OF
mastery inactivity in res rect to the pay
ment Of its debt TO the Government. 1t is
announced that the railroad company will
permit the Government to pay the bonds as
they fall due ana will continue to reimburse
the Government under the Thurman act,
which calls for % per cent of the roads net
earnings As the indorser Of the Southern
Pacific Company's bonds the Government
will perhaps be required to pay if the party
that issued the bonds is insOlyent The
men who constitute the Southern Pacific
Company have managed, while the Govern
ment has been paying interest for them, to
accumulate private fortunes running into
the tens Of millions. They at least are not
insolvent. On the contrary a low estimate
Of their possessions ID taxable property
would be $780, 600 000 Whether this com
pany prOper-ihe Southern Pacific, the Cen
tral Pacific and branch and the land which
they have been granted by the Government
to aid in the construction of their rOads-ls
worth the amount of their debt to the Gov
eminent is not known. II the Government
has to pay the Southern Pacific's debt 1t
would seem that it could not do otherwise
than tC reimburse itself out OF the COM
pany's property to the extent that the COM
pany's property viii afford reimbursement.
The spectacle OF four men worth an aEgre-
gate of Sl0QO00OO0 standing aside and
letting the party whose Endorsement Of
their paper enabled them to accumulate
their millions pay their notes as they
fan due would be singular. Thirty odd
years ago the Government Endorsed their
bonds The Endorsement by the Govern
menu enabled them to sell bonds at
figures which permitted them TO make
tens Of millions ont Of the construction OF
the road. Wien interest became due the
Government had to pay it, When bills
were introduced into Congress TO compel
the company to pay to the Government
percentage Of its net earnings the COM
pauy fought them with the strongest lobby
ever organized 10 influence an American
Congress. Ii has been no secret for years
that Thurman would never have got his bill
through the Senate If be had not provided
himself with Il list Of Senators who. accord
ing TO his information, had been corrupted
and held il over their heads while the vote
was being taken. But the Thurman act
was only intended to operate during the
period while the debt was maturing. 1t
was made necessary by the contention on
the part Of the company that he company
was not legally bound to pay interest until
the bonds became due The proposition 10
let the debt remain due the Government
viii be considered in tile light of the COM
pany's dealings with the people. If the
road Lad been run in the interest Of the
people at large there would be some reason
why the debt should be allowed to remain
unpaid. But no private business on this
Coast has been conducted more distinctly
in the interest If its owner than The roads
Of the Southern Pacific Company. Not
only has that company invariably charged
all The rates traffic would bear, but it has
intrigued to control legislative bodies and
courts Il has set the bal example Of elect
ing Ole Of its own officials to represent the
State in the national Senate, and in many
ways subordiuated the interests Of the State
TO the Interests Of the company. The pres
eut chances are that tie company Will have
to pay It's bonds OF lose the control Of the
road.