The morning call. [volume] (San Francisco [Calif.]) 1878-1895, 1893-02-19

pany to be S22S COO 600, this committee in
1880. reported that the 1860 miles of road
way and equipment, IL built to-day, would
cost Sol, 600, 600.
To this If we add the 500. 900 900 of unsold
lands together with the $50, 000 900 in the
hands of The United States, aud trustees of
the road. and SS000.000 for water fronts at
San Francisco, Oakland and Sacramento,
which the Commissioner of Railroads in his
report OF 1892 says 'are invaluable" also
$1,000. 600 for bills receivable. 100000 for
stocks and bonds owned by the company
according to its own admission. we have an
aggregate ownership by official testimony,
aid based on conservative estimates" OF
sos, 100000. in which the value Of The roads
is put down at $4,000, 900, whereas they
are alleged to have cost S169. 600, 000
The Central Pacific Company owes the
United States-b0nds and interest S55210.-
04l 81. and has first mortgage bonds to the
amount OF S27 ,853. 900, or a total Indebted
ness of SS3,0O0.000. exclusive of floating
debts, VIII oh would become due to the
United States upon payment oil the hrst
mortgage bonds and foreclosing the exist
ing liens.
In these statements procured from Gov
ernmeDtal testimony only the values which
the committee terms very conservative
have been given. But many of these own
ings have special values enhanced aud en-
larged by the fact that the properties have
been specially built, secured or arranged
Tor railroad purposes and uses. AS q very
striking proof of these larger values, The
testimony of Manager Kmball OF the Union
Pacific to the investigating committee in
1890 may be cited. wherein he says that bis
company could not afford to exchange its
coal lands and coal rights for the Govern
ment debt" This statement is more read ly
understood when the fact is known
that this company owns more than 10000
acres OF coal land in Colorado, Wyoming and
Utah, and at one of its mines Rock Springs,
the company takes ont million tons
of coal a year-frOm six workable veins,
each forty feet in thickness, and that the
entire anthracite coal region of Pennsyl-
vania is smaller than the coal lands OF this
Union Pacific Company.
The same enhanced values might be nut
upon the asphalt lands of the Central Pa
cfc In California, probably monopoly OF
their kind in this country.
The millions of acres OF lands, mineral
and agricultural, gwen to these bonded
companies by the United States are without
q parallel, except in case of the Northern
Pacific Railroad.
a. has been stated, the practical outdoor
manager Of one OF these roads admits that
the Government debt is mere bagatelle as
compared with the ownings of these COM
panies IN the fifteen States and Territories
through which they pass, like a great sys-
support from every section of these most
fertile fields Of the New World.
There appears to be. then, no good solid
business reason why these debtors should
not be regarded as amply able to pay should
the Government pursue its legal and equit-
able rights second mortgage, redeem the
property by paying off these first mortgage
bonds, and foreclOse its own statutory
mortgage upon the property in case these
companies make default in 1897, when the
debts mature.
Were these companies facing maturing
obligations to Wall street firms-which
would consider only the one question of
the debtors sovency-tbeir course would
be that OF active preparation for prompt
payment But as the lions share of their
debts is due to the General Government,
by which the roads were created,
and have been each year INDUCED
with growing generosity, all forms
Of argument and inducements are
brought TO bear upon Congress to cOnStrue
the game of sbuttleeock, in which the
United States Is the man of straw. at which
they have so successfully played for quar-
ter Of century. In the absence of ndiVd-
ual losses to any, and by reason of personal
gains TO many of the relatives and friends
of our legislators, ready acQuescence is
given 10 the public Improvement feature
of the arguments of those who lobby in the
interests Of these corporations and the peO-
ple's interests are allowed to go by default.
Is ii not apparent to a child in arithmetic
that to refund debt of S120. 000 90 for 100
years by a reduction OF interest on $685.
100000 of that debt from per cent to 2
Will give 10 these companies gratis more
money than they will be required to pay in
annual or semi-aunual payments as pro-
posed?
The failure on the part of these CON-
ranies TO pay even the interest on their
debts 10 the United States, which could
have been done by services rendered the
Government. and the amount received from
the sale Of lands which cos. them nothing,
must remain most striking index Of what
they would do under the new legislation
proposed.
The only compulsion that can be attached
to iefunding bill is TO make the entire
debt mature upon failure to make the annual
payments, and then the United States has
no redress other than that now existing,
VIZ: that of foreclosure and protecting its
larger debt by paying the first mortgage
bonds
But one danger must be met and guarded
against by the United States and that is
that the power be taken away from these
companies to render themselves insolvent
| prior to 1897 by the sale or transfer of any
properties. storks, bonds, securities or own
| ings OF any nature 10 parties other than the
| United States.
The fact that neither the power nor the
| disposition is lacking TO imperil the Gov
pI
| cent action Of the directors of the Union
| Pacific Company since Senator Frye's COM
| mittee made its favorable report and pro-
| posed bill in transferring TO Drexel, Morgan
| & Co. of New York City S100,000,000 of
securities having liked values" to obtain
loan of S24,000.000 on notes of
| three years at q per cent on creditors
| agreement" AS these securities of liked
values" are daily negotiable. and the notes
are made 10 mature prior to the Govern
| ment debt. Ii will readily appear that few
| such deals would strip the United States Of
| all chance to realize the stupendous indeb-
| ed ess of these companies now secured by
| second mortgage.
| 1t therefore appears that a mos. i'm pera-
! tive duty of Congress Is to amend the char
| tiers OF these roads. a right reserved by the
United States, so as to provide that ma
| j0rity of the directors Of each company shall
| be appointed by the resident. with advice
| and consent OF the Senate; that such di-
rectors shall be Immediately installed I'M
| der oath of allegiance to tie United States,
and charged with the duty of pro-
| tecting the Government interests as repre-
| scented in these debts; that they shall re-
| fuse to sanction not only the Spend'ngs OF
| the immense annual earnings IN the better
ment OF the service" of the roads, but that
they shall see that no securities, ownings
| or rights Of these companies are transferred
! or otherwise disposed OF to any one for the
| purpose OF raising money or otherwise put
! ting them beyond control of the United
! States and other owners Uf the roads bonds.
With men of sterling honesty and plain
| business requirements in these offices, who
! Will regard their public Office as a public
| trust" the future IF this stupendous in
| debtedness 10 the United States will be
| secured. A. !. l..
| THE LITTLE BIRD.