The morning call. [volume] (San Francisco [Calif.]) 1878-1895, 1894-09-15

Hopkins. Ii was organized for the sole pur-
pose OF leasing and operating the Central Pa
CHIC ana Southern Pacific railroads, all of
which were controlled by the s4me men, IL
never quit any railroad; il never owned any
railroad; 1t never issued any bonds; it never
issued any stock, except To pc held by its Or
RdhiZerS, who constituted mere partnership
unoef the name and gulse of a close corpora
lion. 1t was organized for The purpose of di-
Nerting The earnings OF the Central Pacific Rail-
way Company and in defeating the Government
In lis attempt by The Thurm act OF 1873 to
enforce the taking OF steps necessary to enable
That company TO meet its obligations TO the
government; il leased both systems Of railroad
upon the terms fixed by the partners who con-
stltuted that close corporation; 1t took up all OF
the leases held prior TO April l. 1885, by the
Central Pacific Railroad Company; 1t took the
place of that company in everything that con-
cerned the operation OF these systems of rail-
roads. and IL was and Is attempting TO collect
for the use OF these four men and their estates
the sum of S1,S00.00o, which. if claimed by
the Central Pacific Railroad Company, would
properly be held 10 await the maturity OF the
obligations of that company TO the Govern
meDt, and be then Offset against those Obliga-
tiOns. urged that upon the evidence showing
that this other close corporation was at the
very best a mere agency of the Central Pacific
Railroad Company, which was attempting by
this method TO evade its obligations 10 the Gov.
eminent, payment should be Withheld until upon
The maturity of the greater obligation to the
Government equity might determine whether or
not this Judgment at law should constitute an
offset 1t was conceded thai if the Judgment
were held by the Central Pacific Railroad Com
pany the course which l advocated should
properly be pursued and would, as between
private debtors and creditors, be enforced by a
court OF equity. The whole question. there
lore, turned upon the relation existing between
the Central Pacific Railroad Company and the
southern Pacific Railroad OF Kentucky. / was
not obliged 10 rely upon the meager evidence
furnished by the Pacific Railway Commission,
whose investigation was commenced and con-
Guided shortly after the organization of this
misunderstanding company, for the attorney
representing the Southern Pacific Company be-
lore The Committee on Appropriations OF the
present Congress, in The course OF his statement
before that committee, being driven 10 de-
tense OF his principles, concerning the con-
fusion OF business affairs between the Southern
Pacific Company and the Central Pacific Rail-
road Company, said: whether there Is
any provision of the lease between the Central
Pacific Com any and the Southern Pacific CON-
pany as 10 these outside expenses / do not
know, but should say, practically. Ii does not
make any difference what the contract is, be-
cause substantially the shareholders OF one are
the shareholders OF the other, and it is like pay
mans clothes"
Congress, by an almost solid Democratic
against an almost solid Republican VOTE re.
Jected the claim and held that Ii must rest
and. 1t now rests in allegiance to await the
maturity of the larger Government obligation.
am satisfied that the same Congress, that the
same Democratic majority in the Congress,
will stand by the people of California 10 shield
! ing them from the bur den which the funding
In fro
| the wrong that would be involved IN condoning
| the frauds and often uses Of the people in ques-
| ton; but IL will depend very largely upon the
people of Califonia-it will depend very largely
| upon the support, the moral support which
| shall be given TO US in our fight by the people
! in this State whether the East will support US
| in our position or will conclude thar we are not
expressing the will or the sentiment of the
| people OF California. 1 wish here 10 remark
! that Clipping was mailed to me recently con-
| tanning column editorial which appeared in
! the Sacramento Record ULlon H. AIDED Judge
Mcguire as a Demagogue," and denouncing me
for having misstated the relations existing be-
tween the Central Pacific Railroad Company
and the Southern Pacific Railroad of Kentucky
in order TO make my point against the latter
company. l hope that the distinguished editor
OF that great but unfortunate journal will pub
lish suitable apology upon reading the state
ment of Judge Payson, The attorney for the
company, which states the relationship existing
between those companies more strongly that 1
stated, and more strongly than there was any
need OF stating it for my purpose.
! l notice that Mr.. Estee in all OF his speeches
| throughout the state is denouncing the pend
| ing funding bill as the Democratic funding DILL
! aud that his statements that effect are being
| copied by lesser lights among the Republican
| orators and by Republican platform. makers In
! the various Congressional districts. The Re-
hi for ENp MA
! to oppose the Democratic funding bill, ana
/ am forced 10 see that they pledged be-
! ca use otherwise grave fears have been enter
! TaiDed as TO what course they would pursue !;
but 1t is TO be sincerely hop that their pledge
! TO oppose the Democratic funding bill will not
be so construed as 10 permit them 10 support
| the Republican funGing bill. The funding
! scheme is no. new. II was introduced in the
| Fffty-fiTst Congress, which Republican,
! aud was avorably reported both by the Senate
! and House committees, both of which were Re-
! publican; Senate bill 26S0, drafted by Sem
ator Davis OF Minnesota one OF The leading
| candidates at this time for the Republican NOM
! in alton for the Presidency. was reported from
| the comm tree by Senator Fry OF Maine, with a
/ recommendation that it should pass. Ii pro-
! vided for Jefunding the nLral Pacific Rail-
road debt in seventy-fve years at per cent
| per annUm, and req uired that the company
should be required TO pay only per cent dur.
Ing the bTst ten years, the other per cent TO
be CAPT allied. similar bill was lepOTted by
| the House committee on June o. 1890 with "A
| recommendation that II should pass. This was
the Republican scheme OF refunding. Mark
/ you, it contained no condition whatever-a fiat
refunding of the debt with an extension of
credit for seventy-fye years at the te OF 2 per
cent per annum
| What is the so!called Democratic measure
/ IT provides tor reiunding the Central Pacific
Railroad debt upon an extension of fifty years
| at per cent and establishes and makes a con-
diIiOn TO the acceptance of the term of that act,
requiring absolute security on the part of the
company deposited IN the treasury for the pay
ment of the first mortgage bonds at their ma
tuTity
These are the distinctive features OF the so.
euces between the Riley bin aud the Davis bill
are the only things to which the magnates OF the
/ Central Pacific Railroad Com pany object They
were satisfied with the Republican refunding
| bill.
Now, what is this measure-the pending
! measure in fact? Every Republican upon the
| Committee Of Pacific Railroads, except Mr..
Cooper OF Wisconsin, Is not only in favor OF The
measure, but Is an advocate of it. For several
J months the committee stood divided that
more Republicans upon the committee favored
! the refunding bill than there were Democrats
! favoriDg IL, and, in order 10 secure two Demo-
| cratic votes upon the committee the four Re.
| publicans and the three Democrats who favored
| the M asure were obliged o make the conces-
sion which j have stated-that The railroad
| company. as condition precedent 10 getting
! the benefit of the act, should pay or deposit
| absolute security with the Treasurer OF the
| United States for the payment OF the first
mortgage indebtedness at maturity.
The meeting then adjourned with cheers
| for the speakers and tue patty.
.--------------