New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1894-01-25
GnTERNMENT CONTEOL.


The proposition Of Senator Morgan. OF Aln-
hama. TO extend Government aid Ia The Nlca-
raglm Canal enterprise contains one feature
which Congress- will do well To consider with
unusual care before adopting. II Is that Whlch
provides for the appointment of ten Of the III
tccn directors of the new company To represent
the Government \ similar proposition Is I'M
dorstooi 10 be one Of the features Of the plan
now under consideration by the Reorganization
Committee of the | MON Pacific halfway TOM
pany for he adjustment Of the company d'bt
to the Government and the rehabilitation of
the corporation. The effect in h1ih cif"~ VIII
be 10 put the Government in control Of The cor
pora lions named. In other words. I'll" nitcd
States will embark in the business Of trans
pnriation Government control Of railroads ana
canals. concerning which - much las been
said and written for the last ten years though
the subicrt has never come directly before Con-
crcss for discussion be m established
fact II will be- the beginning of an experiment
I'm DatcrnaliSm in lis most concrete form WIN
out entering upon the merits Of the question AZ
this time we venture 10 suggest that ia" subject
is not sufficiently well understood 10 warrant
the taking Of any such decisive step without
fuller discussion and more thorough inv'stlsi-
ton than have yet been bad. For II means
radical departure from the established policy of
the Government. and the principles on which II
WAS founded such step should not bc taken
without carefully weighing the consequences
and fOrccaSiing the possibilities involved.
We do not apprchcnd any danger Of immohi-
atc action on the Nicaragua Canal scheme.
Financial conditions. for ON" thing. viii not
permit H. The case of ~" Union Pacific Is
different. The road is Row in The hands Of re-
ccycrS. and It's debt 10 the Government begins
10 mature during the lifc Of the present Con
grcSS Prompt action 10 meet III" emergency
Is imperatvcly demanded There appears 10 be
some foundation for the report that Il plan or
reorganization. the details of which have not
beer perfected, will be- presented 10 the Govern
mcnt 10y the companys representatives, by
which the debt To the Government shall be cX-
tended at u low rate Of Interest Tor Il long
period, and the other outstanding obligations
adjusted upon basis that VIII reduce the
annual fixed charges to about SS,OOOOOO, which
would leave upon the estimate or last year 5
net earnings small margin for the stock.
Ostcnsibly TO strengthen the security OF the
Government. but really. no doubt. to win tie
support Of Congress, ii Is proposed to give the
Government Il ma iOrity OF the Board OF ID
rcctors-ten. 1t is understood, being the mum
Der agreed upon, to five directors chosen by the
stockholders. 1t hardly needs To he pointed out
that such Il provision means, II Ii means any
thing. Government control OF Il great railroad
system. 1t plungcs the Government ut once
into the business Of transportation. We do not
think we are quite ready for that. II Is not
likely that the proposition. If made distinctly
and upon its merits, would meet with popular
approval 1t certainly ought not 10 upon so
slight knowledge OF the subject as the public
now has. And the Union Pacific complications
have by 10 means reached point where Gov
eminent control is the only or the best solution
Of the problem.
We have proceeded thus far upon the asSump-
ton that the business Of directors il 10 direct.
| and that the financial policy Of a railroad com
| panv is managed and its operations are con-
Quoted according TO the will OF ma jOrty OF the
| board Otherwise there Is neither sense nor rca
| son In the proposition under consideration IT.
| however. the intention Is To win the support of
| Congress TO the reorganization scheme by max
ing places for ten political friends Of the party
| i'm power whose function il will be 10 draw sal
aries from the company for sitting in directors
meetings and acqiicscing In Whatever the di
rcctors who represent the real owners Of the
| property may propose, the pam II sun more
open to objection. Ten men i'll the management
Of such an enormous property, In which they
| had no pccunary interest might perhaps resist
the temptation TO make il a political machine
or TO use II for speculative purposes. or In their
! own personal interests. or To DO any Of the mis-
chief for which they would have such abundant
opportunity. But ten men under pay for doing
nothing. rs part Of The consideration for which
the Congress Of the United States arrangcs the
settlement Of a debt Of $JO.OO0,000. would be
/ Il spectacle both ridiculous and shameful.
The Government has been represented in the
board by five directors appointed by the Pres
dent ever since the company was incorporated
The opportunities for their rendering any useful
service either to the Government or the CON-
pany In al that time have been exceedingly