The record-union., 1896-02-13
THE FUNDING BILL.
How the Anti-Funders Have Changed
Their Base.
How the Government May Right an
Unforeseen Wrong to Its Debtor
without Unloading on Itself
(From the Placerville Democrat.)


There has been SO much aimless firing
at everything in sight that the wrong
man on the right side of the contro-
versy was in imminent peril. AS that
was a serious menace to our safety, we
kept out of the way.
Then again, we have not known pre-
cisely what the question was, nor what
the racket was all about. But in that
respect we have been no more bewil-
dered than some of our friends, hitherto
inclined to follow Sutro and his retain
ers, and who have asked US to tell them
what those reformers are now doing to
serve and save the country. Had it not
been too heavy to lift, they would have
saved it long ago. But as the country
was too heavy for them the question is
too weighty for US.
Two years ago, to have any following
at all, they stole the thunder of the
PopulistS, and nearly all of them favor
ed Government ownership and opera
ton of the Central Pacific Railroad.
They now disclaim the larceny and
in their late memorial to Congress, pur-
porting to emanate from mass meet
ing, they protest against any measure
for refunding the bonded debt of the
bankrupt road. and insist upon the
foreclosure of the Government mort
gage. But how the Government is to
be subrogated to the rights and RENE
dies of preferred creditors without re-
funding or paying the full amount OF
their paramount claim. is left to va
grant conjecture. 1t goes. however,
without saying, that any suit by the
Government to foreclose it's own COM
paratively worthless lien, would in
volve a decree in favor of other cred
itors for an amount that would nearly
or quite duplicate the road. For it's
own claim, it may compromise with it
self, either before or after the suit, but
a decree in favor of preferred credit
ors must be paid or refunded.
BY thus striking from their amended
protest, thrice considered, the favorite
dogma of the Populists, Sutro and his
squad of Hessians have sacrificed false
pretense to plain mendacity. They meet
the screaming catastrophe with which
they have alarmed us with a merely
negative and obstructive subterfuge
and disorderly change of base. To
cover their retreat, they fill the air with
Parthian arrows and their insolent pro-
test with impertinent and irrelevant rot.
But they deceive no one who knows
how cheerfully they would, if they
could, have made it worse.
As it is, however, they have made it
plain enough, that minus its debts, the
Central Pacific Railroad is the odious
object Of their righteous rapacity. They
incidentally suggest that to be wrecked
and redeemed it must be wrested from
its owners and creditors, and that to
refund its bonded debt would defeat a
| 'consummation so devoutly to be de-
sired" Hence their multifarious and
indignant protest against robbing the
Government by refunding at lower
rate of interest an already bonded debt,
which the debtor is willing to secure and
pay, and the amount of which it is to
be ascertained from the books of the
creditor and by computation, without
reference to tags, memorandum or
ledgers of worn-out contract and con-
struction companies to which they so
often appeal. BY that old riddle of re-
form we were always puzzled.
But we infer from the most vehement
passages in the amended protest that
such finality as refunding would cash
ier it's authors and send the anti-rail-
road agitation of the last twenty years
sobbing down the wind-a sad refrain
of Loves labor lost" It is also plainly
intimated that it would outlaw Hessian
wreckers in the service of any foreign
syndicate or carpet-bag corporation
that might otherwise be induced to take
the bonded road, minus its compromised
or cancelled debts, and to make it for
the emancipated State and for it's dis
inherited builders and owners a regu-
lar Sutro tunnel on wheels.
That settles it; and shouting to all the
protecting gods at once, we protest.
For such a scheme of plunder and re-
venge the Government is expected to do
what Sutro never did-to unload on it
self Bad as it is, his example is better
than his advice. And if the Govern
ment were speculating in bankrupt rail-
ways it could find more reliable advis-
ers than this old sharper or any of his
retainers. 1t could find one in the dis
tinguished and rightful predecessor of
President Cleveland
Under the administration of Presi-
dent Pierce about forty railways east
of the Missouri and Mississippi Rivers
received donations of public lands. A
few years later there was a swirl of
speculation in bankrupt railways out of
which, by his superior sense, Samuel
J. Tilden, of sacred memory, made him
self a millionaire. AT banquet given
in his honor he was rallied for the Sc
cret of his success, and in substance,
among other things, said: "A bankrupt
railway belongs, in the last resort, to
it's bondholders. Therefore a safe oper-
ator will deal in bonds, but never gam
BILE in stocks. If the bonded debt be less
than the present value of the road, sub
ject to redemption, he can buy with a
margin for speculation If more, he
may buy in the order of registration up
to the value of the road, less a margin
for interest, and leave the rest for finan-
ciers who are blessed with more money
than brains"
The eminent good sense and democ-
racy of the dictum we have cited will
be admitted. Guided by it the Govern
ment will not buy first mortgage bonds
without a margin. and thus double q
burden which it cannot unload If the
present amount Of the first mortgage
lien for $27, 100000 is enough to buy or
parallel the road, the Government claim
for S5S,000 600 is too much to lose And
as the Government is not supposed to
have more money than brains" we
take it for granted that it will do the
next best thing for all concerned. And
il we must foreclose and wreck the road
or refund its debt. with most of our
exchanges that have said anything
about it, we prefer to refund. The debt
it created is due to, not from the Gov
egnment, and for it to dispute the
amount or validity of its claim would be
to impeach it's own record, with the
folly and bad faith of its self-appointed
dictators.