The record-union., 1894-10-12

pie. and sinking fund could be estab-
Iished Tor their ultimate retirement. Thus
the road would earn itself free of debt
under the first mortgage and the entire
property become subject to the second
Both the first and the second mortgage
must be discharged out of the net earn
ing Of the road. There is no other way
by which the money can be obtained.
There is no recourse in this matter except
as against the property itself or as against
its earnings.
The holders of the first and second
mortgage have the property, it is true,
and the question naturally arises, Can
they make SS5, 600, 900 out of it by imme-
date foreclosure? The answer to this
| question is not far to seek. The most
prejudiced mind will admit that the
| property is not good for this amount. By
the road of immediate foreclosure, the
loss to the Government will be nearly or
| quite equal to the whole amount which
Will become its due. Immediate fore
closure thus means simply the abandon
ment of effort on the part of the Govern
ment in the direction of REIN bursement.
But the Government ought to be paid,
and it can be paid. The extension of the
time for such payment will distribute its
burden over a long period, and the in
dustries of the country suffer no oppres-
sion by attempting to assess the value of
the debt upon this generation by making
| adequate rates of fares and freights.
Our contemporaries are teaching the
| very reverse Of the truth when they de-
clare that extension means the infiiction
OF vast burden upon the shippers who
are TO use the road. They are teaching
| the reverse of truth when they attempt to
teach the possibility on the part of the
creditors of the road of recovering the
amounts due them by immediate fore
| closure. Misrepresentation of this kind
may not be willful, but it is certainly
perverse, because the facts of the stua-
| tion are very simple and the meanest
capacity is capable of mastering them.
An extension of the time for the pay
| ment of the debt due to the Government
means the eventual recovery by the Gov
ernment of every dollar loaned to the
Central Pacific Railroad, and without
imposing upon the shippers additional
burdens in the way of increased rates.
Whoever attempts to refute this state
ment must show first that the value of
the property held as security for the re-
covory of the sums loaned under the
first and second mortgage is equal to the
| aggregate amount of both mortgages; or,
IN other words, that the Central Pacific
Railroad from San Jose 10 Ogden is worth
$50, 100000, may be sold under foreclosure
proceedings for that sum, and that the
entire debt may be thereby discharged
The length of the road between the
| termini mentioned is $50 miles. Eighty
five millions of Indebtedness is prac,i-
cally 100000 per mile. We present
merely the ascertained opinion of compe-
tent engineers when we state that the
road could be paralleled and equipped for
thirty three per cent. of this sum. Herein
then we have the terms of the entire prob
lem. The relation between the Govern
ment and the Central Pacific Railroad
Company is simply an ordinary relation
which so frequently arises between debtor
and creditor in the transaction of any
business. The case differs in no respect
from that which would be produced be-
tween private citizens having an analo-
gous relation. The settlement of the debt
between the Government as a creditor
and the Central Pacific Railroad Conn
pany as debtor should be upon lust
such basis as prudent business men
would adopt IN the settlement of like
relation.
In the case under consideration, two or
three Commonwealths of the United
States have special and peculiar inter-
SSts L u0 N6IlldDu iOI 1ullI6QIdLG SettI6-
ment may inflict injury upon the indus
try of two millions of people. Forced i'm
mediate payment may result in the bank
ruptcy of the debtor party, to the injury
of the creditor, and to like injury to the
Commonwealths having a special rela-
ton to this subject. Divested of preiu-
dice, and no man could be found on the
Pacific Coast willing TO say that to extend
the time for the payment of the debt of
the Central Pacific Railroad Company to
the Government is not wise and is not
the natural. convenient and harmless So
luton of the question; and neither could
any man be found willing to assert that
the extension of the time of payment is
not justified by every consideration of
wisdom.
A PROPOSED EXPERIMENT.
The Chronicle says that John T. Kidder
hos Sla1 on official Will,