The Seattle post-intelligencer. [volume] (Seattle, Wash. Terr. [Wash.]) 1888-1914, 1895-01-28

Ben ate mnifsee Sss - Fsves 81 Ges-
ernmens Foreclosure.

ernmens Rorse8osure.
washington CITY. Jan. Ex-senator
g-srs. ehasr1s7an OF the senate committee
On railroads. yesterday presented Ie-
PORT fTxrn that committee concerning me
Pacific railroads The report - not based
on any BILL tcsore congress. ard IS M
tended simply e supply the senate With
all the information obsa&nable in the
Indebtedness OK the Pacific railroads. to
resher with a brief sketch 81 the history
Of both The Union Pacific ard Central
PacIfc systems. TIE part Of the report
devoted to the Pacific railroads deals with
the charter ard legislation, the rnads
embraced in the system. the indebted
ness, assets and earnings. The report
makes no direct Recommendations, but
urges Tire srny1rtarce Of taking up the
question: Of rhe Pacific road Indebted
ness. After diSsussiag various measures
OF making secure the government inssebt-
edness on the unson Pacific. the report
says:
Another course seems 70 have tten
left open by the government under the
sixth section OF the act or 3D.. which
provided that the grants were made Upon
the condition that the company should
pay the subsidy bonds AT maturaty- This
Is condition Subsequent, and for a
breach OF the same the United States
may. at the maturity OF the debt. pro-
coed 20 forfeit the charter OF the COM
pany and wind up its business through
receiver and take. It's chances Tor a Ie-
coyery OF whatever portion OF the debt
It may be able to obtain. From what We
have said above. we think IL sure that
the amount would bs very small itsceed.
i, IL a question, however, on the whole,
If IL might not be the best thing under
the circumstances 10 do"
TO this the report adds: Your COM
miIsee. however. do not wish TO be UNDER
stood as recommending this measure of
relief. but merely suggests II as an al
Tentative. In case other remedies believed
uew to be better should fall
Positive ground Is taken against the
governments foreclosing the liens and
operating the roaals. To this plan they
say there are many grave objections,
and add: mo considerable number OF
citizens of the United States. certainly
not a majority. have ever declared for
the government control of railroads, and
fewer yet have ever seriously entertained
the idea that tae government should en-
ter the field OF railroading as the owner
and operator OF but one transcontinental
line OF railroad. and thus come In COM
petition with the other transcontinentaI
lines operated by private Individuals.
Beside the main line of the Union Pacific
and Central Pacific, which were intended
by congress 10 make and constitute enc
eranseontinentai line. there are now In
the United States four other lines reach
Ing from the Mississippi river to the
Pacific ocean, and having their connec-
tons with Eastern trunk lines. We think
1t clear beyond question that as a finan-
cial investment the operation of the
bonsis-aided Pacific roads by the govern
ment would be a flat failure, and we are
abundautly satisfied that on the Ques-
ton OF governmental policy 1t would at
present. and under existing circum-
stances, Se unwsse, and fraught with
serious consequences to the republic, with
results far reaching and in the. end in
furious"
In case OF the failure OF these plans,
they suggest that the only alternative
would seem to be to refund the Union
Pacific debt for considerable period of
tirle. at a rate of interest commensurate
with the EARNING capacity OF the road.
This. says the report, sis the plan
which has the most favor with ffnanciers
and those who have given this subject
much attention.
AS TO the period for which the debt
should be extended. and with respect TO
the rate OF interest, no special recom-
mendation is made. That" says the
report will be matter for future
adjustment, when the details Of the plan
shall be more fully developed At pres.
emit our recommendations Will. be con-
fined generally TO the matter of the re-
funding of the debt for such a period
and at such rate of interest as shall
enable the company. under ordinary cir
eu'nstances and business conditions, to
meet the current interest and a portion
of the principal OF the debt each year.
so that at the expiration OF the period
Tor which the extension is granted the
debt may be wiped out. In this arrange
ment. two plans have been suggested:
First, the continuance or the sinking
fuisd and the payment into 1t of larger
snare or the net earnings than are at
present PAID into It. Second, periodical
payments OF fixed amount into the
treasury of the United States until the
debt Is liquidated.'
The committee does not for the pres
ent offer any suggestion as To the relief
TO be afforded the Central Pacific.