The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1895-12-20
STATE DISCRACED
Senator ThurstOn, the Railroad
Tool from Nebraska
Loses No Time in Serving His
Master
In THE q. s. SENATE.
Offers a Bill to Sell the Govern
ment's Interest
In the Union Pacific-R. r.
Attorney as Senator.

WASHINGTON. Dec Ex-senator Thurs.
ton, of Nebraska, who is attorney for the
Union Pacific railroad, has introduced
his first bill in the senate, and is OBJ
viously in the interest of that railroad.
On its face it is the bill of the attorney.
1t purposes that the treasurer of the
United States shall compute and ascer-
tain the amount which will be due to
the United States on the Ist day of July,
1896, from the Central and Union Paci-
fic roads, by reason of the issuance
and delivery of bonds of the United
States TO aid 10 the construction OF
said roads The amount is to be ascer
tanned by computing interest upon each
OF said bonds up to the LIST of July, 1896.
and deducting therefrom the amounts IN
the sinking fund established by the act
of May Z, 1880. computing in July, 1896.
And it is further provided that on that
date the treasurer of the United States
shall offer for sale the entire claim and
demand of the United States against the
said companies for and on account of the
issuance of bonds to aid in the construc-
ton of the said line from the Missouri
river to San Jose, Cal, including all the
right, title, interest, estate and lien of the
United States against the railway, and
telegraph lines, properties aud fran
chises of each of the said companies, as
fixed and established by the several acts
of congress. All this shall be sold, "to
the highest bidder, whose bid is not less
than so per cent of the said ascertained
amounts. which will be due the govern
ment of the United States on the said list
day of July, 1896 And in case there
shall be no offer of an amount equal to
said so per cent aforesaid, the secretary
of the treasury may adjourn the said sale
from time to time as he may deem ad-
visable."
This, in substance, is Senator Thurs
toms bill. There is, however, mean
ingless provision "that nothing in this
act shall be construed or taken in any
wise to affect or impair the right of con-
gress at any time hereafter further to
alter, amend or repeal the said acts here
inbefore mentioned; and this act shall be
subject to alteration, amendment or re-
peal as, in the opinion of congress, JUS
tice or the public welfare may require
No one imagines for one moment that
anybody would bid for the Union Pacific
but the present managers of it, or some
one in their interest, or that the price
bid and paid would be more than 80 per
cent of the amount due the government
The amount due the government now by
the Union Pacific is about $60,0OO,000.
including subsidy bonds, and the amount
already paid in interest-50 per cent on
the above debts $30,O00.00O. 1t will
be seen at a glance that the government
would lose by the proposed sale of the
Union Pacific
Section of the act of 1864, concern
ing assessments on the capital stock of
the Union Pacific, provides that "the
company shall make assessments upon
the stock holders of not less than So per
share, and at intervals of not exceedin g
six months, until the par value of all
shares subscribed shall be fully paid;
and money only shall be receivable for
such assessments or as equivalents for
any portion of the capital stock"
Out of the original $3S, 100000 of stock
S21S.O0O was paid in cash. This is all
the monev the Union Pacific ever re-
ceiyed from the stock. There is still due
the Union Pacific treasury and likewise
the government $50, 900, because the
grant of bonds to the Pacific roads was
made upon the condition that the stock
should be paid for in money, and it was
under that promise that the government
! bonds were made a second lien upon the
property.
The act of March 8, 1878, section
says: "That no new stock shall be issued,
or mortgages or pledges made on the
property or future earnings of the COM
pany without leave of congress-" In 1880
S14.O0O.O00,of new stock was issued by
the Union Pacific Railway company-by
a vote of its directors-without the road
receiving one penny in compensation
In 1881 another issue was made of &c.
100000, which was sold to stockholders
at par. The stock was then selling on
the Stock Exchange at about 1T. This
money was used by the Union Pacific di-
rectors to almost rebuild the worthless
Kansas Pacific. which they had sold to
the Union Pacific for $10,000,000 of its
stock, giving "a like amount OF Kansas
Pacific stock in exchange, which cost
them 100000. The Union Pacific stock
was worth at this time SILT per share
There was 100000 of Denver Pacific
stock exchanged by the same directors
for $4,000, 900 of Union Pacific stock. This
STOCK cost the directors 100000. 1t will
therefore be seen that the $4,000. 900 oil
stock of the Kansas and Denver Pacific
cost the Union Pacific directors $1,120,-
600, the net profit to them in this single
transaction being $12. $4,000. The same
process was resorted to with the bond;
OF the two companies, whereby the
| Union Pacific directors made $4,000, 900
If these amounts were collected there
would be no occasion for sale of the
road. as there would be sufficient to pay
the government all the Union Pacific
owes it.
|
Holiday Excursion.
Ar 1ak hr