The record-union., 1896-01-15
PACIFIC RAILROADS DEBT.
Expressions by Sacramentans on the
Subject.
They Favor Refunding and Are ct
terIy Opposed to Government
Ownership.

ernment of $50, 100000 in discharge Of
the first mortgage standing against the
Pacific railroads and the foreclosure OF
the second mortgage and the Govern
ment owning and operating the railroad
from Omaha to San Jose?
Are YOU in favor of permitting the
Governments second mortgage on the
Pacific railroads to lapse without any
effort on the part of the Government to
recover what it has invested IN the
roads?
Are you in favor of selling the Gov
ernment's claim against the Pacific
railroads at auction, with limit OF ~
per cent. of the amount Of the claim2
Are you IN favor of an arrangement
between the Government and the Pa
cific railroads whereby the time for
payment of the Governments second
mortgage may be extended, provided
such extension is made in manner to
secure the repayment to the Govern
ment of its advances, with interest on
deferred payments?
Last evening the Post" published re-
plies from citizens of Sacramento as
follows:
Ex-Mayor B. U. Steinman: MY
view Of the matter is simply this: The
question is one of debt, and can be
properly settled only on business prin-
ciples The Central Pacific corporation
owes the United States large sum OF
money, but the security appears TO be
a questionable asset, as the mortgage
is preceded by that of other creditors.
GAS unpopular as refunding may be
in this case, bonded debts are being ad-
justed that way all the time. If the
creditor can't get his pay on maturity
he extends the time of credit, and, when
he has to do so in order to lose less, he
accepts a smaller rate of interest on the
new obligation
''The question is one of commercial
relations and it is simple enough, if
stripped of buncombe and sentiment.
I should say, let the Government make
the best Of the situation and save what
it can out Of the deprecated railroad
property by refunding the Central Pa
cific debt at such current rate of in
terest as it gets on its ordinary loans.
giving all the time it has to give for
liquidation, and insisting on adequate
security
Joseph Steffens, President Cali
fornia State Bank: Rather than have
the Government take possession of the
Central Pacific Railroad at this time I
would prefer to have the debt it owes
refunded on a time not to exceed fifty
years, and at, say 3 per cent. interest,
additional security to be given.
In my opinion Congress is the only
body that can properly consider the
rightful settlement of the matter"
H. Weinstock, of Weinstock, Lubin &
Co: I'm compliance with your request
for an expression Of opinion on the
matter of the Central Pacific Railroad
Fl11D
let me answer by confessing that 1 do
not pretend to thoroughly understand
the question in its various and complex
details. but from impressions gained as
the result of desUltory newspaper read
ing of the conflicting views, it would
seem to me that the question should be
dealt with on the basis simply of a
debtor and creditor issue.
4 can see no reasonable objection to
the Government extending the time for
payment of it's bonds to the Central
Pacific Railroad Company, provided the
Central Pacific Company is prepared to
give the Government ample security in
addition to the property already COW
cred by its mortgage and provided
further that the Central Pacific Com
pany agrees to place annually into
sinking fund a sum sufficient to meet
at maturity the Government obliga-
ton"
J. NJ. Morrison, Chairman of the
Beard of Supervisors: Il am in favor of
any arrangement that will settle the
controversy over the debt of the Cen
trail Pacific Railroad to the Government
for all time. The agitation on account of
this matter keeps everything in Califor-
ria unsettled.
''Refunding at a reasonable interest
with sufficient security seems to me the
quickest and most businessIike way out
of the difficulty. And believe that Con
gress is the only reliable authority to
handle the question.
Nothing can be gained by delay, and
believe the whole thing ought to be
adjusted now and forever by those
whom the people have elected to dis
charge this duty. I am, under any cir
cumstances. unalterably opposed to
Government ownership and control Of
railroads"
Frank Miller, Cashier of the First
National Bank of D. 0. Mills & Co:
Second mortgages are usually re-
newed TO save loss when the property
does not cover both liens with abundant
value. In this case it seems clear mat
the railroad debt should be refunded
Government ownership is an untried
and uncertain remedy. hope Congress
will act on this just as a board of bank
directors passes on a second mortgage
owned by their bank"
w. P. Coleman: 4 am familiar in a
general way with the Central Pacific
Railroad in its debtor relation to the
United States. I am altogether in favor
of the funding of its debt in order to
give it the debtors chance to pay and
save the creditor from loss or trouble
such as will be sure to come from hasty
foreclosure
Il am not in favor of the Govern
ments owning and running the Cen
tral Pacific. unless it should get pos
session of all the other railroads in the
country and own and run them. But
even then we would be going into an
experiment which might involve the
Government in serious loss and embar-
rassment.
I think the Central Pacific is entitled
to the consideration of important equi-
ties in the settlement of its debt to the
United States, and Congress would not
be unreasonable if it should weigh
these equities for all they are worth.
There is nothing to be gained for Cali
fornia by making this matter the sub
iect of agitation. I believe Congress
viii take businesslike view of it.
RsuA "Pure a