The record-union., 1896-06-20
PACIFIC RAILROADS DEBTS.
CONTINUED from Fifth Page.)


certainment of the amounts of principal
and interest of the debt due the Govern
ment as of january /, 1897, and the exc
cution of adjustment bonds to represent
this Indebtedness and mortgage upon
all the properties of the companies to Sc
cure such bonds.
1t is always to be borne in mind that,
under the provisions of the bill as re-
ported, the amount of the debt will be
steadily reduced each year; that each
reduction of the debt will increase the
security of the remainder; that at all
times the debt to the United States
stands secured by completed railroads
with all requisite terminals; and that
any entry into possession or sale under
foreclosure which might become neces-
sary, if the provisions of the bill were
not complied with, would affect not
merely the aided lines but the completed
and perfected systems.
The bill expressly provides that the
mortgages to be executed to secure the
readjustment bonds shall contain a
covenant that in case of a siX-months
default in the payments prescribed in
the Act the entire debt due to the United
States shall, at the option of the PreSi-
dent of the United States, Immediately
mature, and the United States shall be
thereupOn entitled to enter upon and
take possession of the mortgaged prop
critics without applying to the courts or
to Congress for authority so to do, or
may at it's option institute and maintain
appropriate proceedings at law or in
equity for the enforcement of it's claims
or liens.
1t is believed that the bill, in requiring
payments of interest at the rate of 2
per cent per annum and payments on
account of principal due from each
company at the rate of $3.50 900 per an
mum Cor $1,000 day. for the first ten
years, at the rate of $550000 per an
mum Cor upward of ST, 800 a day. for the
second ten years, and at the rate of
$1o0,0OO per annum Cor upward of
$1,000 day. for the remainder of the
term, will practically exhaust the rea
sonably anticipated earnings of the
properties involved; that the security
reserved to the United States under the
bill has been carefully and adequately
guarded, and that the provisions of the
bin for payment of fixed sums at fixed
dates, secured as therein prescribed, will
practically insure the payment of the
whole debt to the Government.
By reference to the Act of Congress
of 1867, establishing the Pacific Rail-
way system, it will be seen that it was
the clear intention of Congress that from
the one hundredth meridian lines should
be constructed southeast to Kansas and
northeast to Sioux City. The intention
of this was evidently for the purpose of
giving the products along the lines of
the Pacific Railways cheap and easy
transportation to Eastern markets, and
to give the freight transported eastward
and westward over the lines connecting
with the Pacific system competition in
rates of freight and passengers In this
connection, especial attention is called
to Section - of the proposed bill, which
gives TO all lines connecting with the
Pacific Railroad system, at any point
thereof, equal times, terms, rates and
facilities for the interchange of traffic.
both passenger and freight, between
such connecting roads and their re-
spective roads, and every part thereof"
1t also provides that ANY contract, ar
rangement, or device, by sale, lease or
consolidation, - ''Or otherwise
intended to give preference or advan-
tage TO any railroads so connecting at
such common point, is hereby declared
to be unlawful" When it is taken into
consideration that at the eastern term
inal of the Pacific system there are
hve great lines of translate roads
which have connection at Chicago and
elsewhere, with great lines of road lead
ing to the Atlantic Coast, it will be
readily seen that this clause, providing
Tor connection with the different roads
practically gives to the transportation
OF freight or passengers going either
east or west competition between the
Atlantic Coast and the Pacific systems.
thus CARRYING ont in effect what uro 9