Iron County register. [volume] (Ironton, Iron County, Mo.) 1867-1965, 1892-08-04

me now and you shall have history and
comparison to your dear hearts dismay.
RAILROAD MANAGEMENT.
In 1851 there was not a mile of rail-
road in the state The state govern
mcnt then inaugurated system for
aiding In the construction of five great
trunk lines by leaning its credit to GER
tain corporations organized for the pur-
pose and engaged in the work of con-
structing them. Whether that was q
wise policy for the state to enter upon
is a question about which the best of us
might disagree, in view of the circum-
stances and the necessities of the state
at that time. From my point of view
it was unwise, for have never believed
that the state or any municipality should
lend itself to the financial advancement
OF personal or corporate enterprises.
But, wise or unwise, the democratic
party did it and stands responsible for
it But when it loaned the credit of
the state it took first mortgage liens
on the franchises and all the properties
OF the corporations TO secure the state
| against loss. Among the assets of the
to the state were !, s24 434 acres of lands
| granted by congress likewise to aid in
the construction of the roads. The ag-
| grcgatc amount of bonds actually
issued for which the state became
liable under it's pledge of credit
amounted to s23, 701 goo, nearly the
| whole of which bore per cent. inter
| amounts between the several roads.
This was done between 1851 and 1857.
The corporations were primarily
obligated to pay both the principal and
interest as they matured. The state
stood simply as 4 security and its
ability arose only on the default of the
corporations If such default occurred
the state was authorized to take posses
SIGN of the road in arrcar and to
operate it, or to sell the property under
the mortgage and discharge the debt
with the proceeds
So the matter stood when the war
came. During that turbulent period,
and for some months preceding and fol-
lowing actual hostilitics. the people of
this state, in common with those of the
| whole country, were so absorbed with
the mighty events then transpir-
ing that these railroad obligations and
pretty much everything of that kind
were lost to sight or neglected. Through
those years Of turmoil the railroads
failed to pay the interest maturing an
nually. OF course, prompt action
ought to have been taken at once upon
the default Of the companies; but prob
ably the authorities were in some meas
ure cxcusable for their delay because
of the unsettled conditions existing at
that that time. After the war the debt,
by reason of the accumulation of inter
est, had swollen to over $50, 900.
! Then began that system of sllillful
financierin-, of marvellous m.nipula-
| ticn, which at that time brought a
i IL H. - = 4
check of every honest man within it.
but which Maj Warner now arplauds
as q feat of craftsmanship deserving
the highest commentator OF the pee
pie. What MAJ. Warner applauds as
praiseworthy / denounce as the eli
max of public dishcnesty-bold,i nso-
lent, criminal dishonesty. in which
theft, bribery and perjury all played
a prominent part
ed to s31, 735, $40. The mortgage liens
| which the state held to secure this vast
Indebtedness were disposed of and re-
leased between 1866 and 1868 by the re-
publican authorities then in control at
jefferson City, and the direct considcra
tion received by the state for the sale
and release of all the liens on all the
roads was less than 100000. The
state had previously received between
| s4o0, 900 and $500, 900 from deferred in
terest paid from profits realized from
operating one of the roads while in pos
session of the state and from other
sources. The entire amount realized by
the state after the war from all sources
was IS, 131, 1876, about five and one-half
millions only of which was realized as
the direct consideration for the sale and
release of the liens of the state. This
republican performance, by which the
| state surrendered liens held to protect
it against nearly ga, 900, 0C0 of indebted
ness in consideration of less than SC, 000,-
600, thereby saddling debt of more
than twenty-five and half millions
on the tax payers. Maj. Warner
| gives US to understand was an honest
transaction, abovc criticism or reproach.
deserving of public commendation. ard
one which he heartily and openly il
dorscS. Maj. Warner asserts that at the
time Gov. Fletcher and his associates
disposed of these liens the roads were
worn out. poorly equipped and of little
value, and that il was really fortu-
nate and splendid financial achievement
that the state was enabled to realize as
much as it did. In his Scdalia speech
| Maj. Warner said: 1.-The charge that
there was fraud or corruption in the
| sale tof these roads, rests, as claim, on
assertion, and has no founda tion in
fact" Well, let us see. The lowest esti-
mate ever put upon the value of the
roads at the date of these transactions
was S35.0GO, 900. In his inaugural adj
dress, delivered on January 9, 1865,
speaking on this very question of the
Sufficiency of these mortgage securities,
Gov. Fletcher said: They (the roads,
are ample security for the amounts ad-
vanced to them respectively" The very
| fact then that $50, 900. 900 of mortgages
| on property worth at n minimum $685.,
OC0, 900 was released and surrendered in
| consideration OF less than IS, 600, 900
stamps the transaction on its face with
the strongest possible suspicion of fraud.
THE PACIFIC DEBT.
But let us be more specific still and see
| whether this rests altogether in mere
assertion. The Pacific was one of the
roads for which the state had become
| security. On March 81, 1868, the bond
| ed debt of that corporation, for which
the state was liable, amounted, princi-
pal and interest, to $40, 7s0,oc0. On that
day the legislature passed and Gov.
Fletcher approved a bill by which the
state realized its 1ein to the railroad
| company in consideration of the pay
ment into the state treasury of $780,
600. These s5,O00.GGO were paid into
the treasury by the company, not in
money. but in state bonds, which
Maj. Warner says were then s'bcing
hawked about the streets Of New
York and sold as low as 81 cents on
the dollar" By this transaction, by
.he release of This mortgage.
the remainder OF the debt secured by
it, amounting to s5,7s0,U00, fell upon
the state to be paid by taxes wrung
from the people. Was that an honest
transaction? At that time the proper