The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1897-10-23
THE UNION PACIFIC SALE.
Government Has Made a Better Bar.
gain than Was Expected.
. E. Curtis, In Chicago Record.


The Ohio Democrats have dragged the
Union Pacific case into the canvass, and
the Cincinnati Enquirer is asserting daily
IN unison with certain New York papers,
that the settlement of the debt of that
railway to the government for 500 ,000, 900 is
the result of a bargain between Mark
hanna ana the reorganization committee.
under Which 1t contributed several millions
to the Republican campaign fund last year
Ihey assume that people have forgotten
lndt the arrangement was made by Presi-
dent Cleveland'S administrations and that
President Mckinley is simply carrying out
a contract entered into by his predecessor.
after requiring the party of the other part
10 pay into the public treasury $4250 900
more than the sum originally agreed upon
JudSon Harmon, attorney general of the
Cleveland administration, who conducted
the negotiations, is now practicing law in
Cincinnati, and is understood to be support
ing the Mclean reform ticket against Mr..
Hanna, although he has taken no active
part. Mr.. Harmon has been appealed to re-
peatedly for statement concerning the
Union Pacific affair but declines on the
ground that the facts and CORRESPONDENCE
were all submitted to Congress, and that
the controversy has been revived for po-
litical purposes only. He does not consider
1t either digniiied or proper for him to allow
himself to be dragged into it, The stories
about Mr.. Hanna's campaign fund he re-
CARDS as too absurd and preposterous to
notice. Mr.. Harmon's eminent position as a
citizen and an attorney would give great
weight to anything he might say on the
subject but he refuses even to discuss the
matter.
interested people who are familiar with the
facts that the government has made much
better bargain than was expected or even
hoped for. In the first place. it has only a
second lien on the property, and If the hold
erS of the first mortgage bonds should fore
close it would get little or nothing. If it
were private affair the government claims
would be worthless. In the second place,
the government mortgage covers only a
part Of the property It does not reude the
about four-fifths of the right of way. If the
property should be divided that portion COW
cred by the government mortgage would be
useless except for local traffic Thirdly. 1t
would be easy to duplicate that part of the
road covered by the government second
mortgage for a little more than half the
amount that is offered in settlement. That
has been calculated upon valuation of $40
600 a mile while responsible contractors
estimate that 1t could be replaced for $20,-
600 a mile. Fourthy, If the government
takes possession of the road as some peo-
pie demand, 1t would be compelled to pay
off the first mortgage OF $23,W0, J0C and in
terest, which is very nearly the entire value
of the property; and, finally the reorgani-
zation syndicate is the only bidder II the
government does not accept Its terms tnere
is no prospect of recovering anything; its
entire interest will be sacrificed.
The original offer to Pres lent Cleveland
was S45 900 0OO He demanded E50QCO more,
which the syndicate conceded, and ne ana
his Cabinet decided that II was very Ia
vorabe trade for the government; II was
S45. $50 900 better than nothing. While Con-
gress did not formally ratify the deal, no OBJ
lection was raised to it, and all the facts
and correspondence were submitted; In fact,
it was proclaimed by all concerned great
triumph of fnanciering, and when the Nc
Kinley administration came in 1t was moral
~ and legally bound to carry the contract
into effect, but times having improved ana
nrosnects having frightened. the syndicate
was compelled to raise it's bid to 600,
and finally consented. The bidders are the
banks that own the first mortgage bonds
and other indebtedness of the roads, and II
they were not so deeply involved In the
property already they would not attempt 70
buy IT under the foreclosure SALE NofOdy
else would touch 1t at any price, but they
realize that the government Is trouble
some creditor and that If their investment
up it's Indebtedness.
Mr. Hanna has never had anything 10 DO
with the affair, directly or Indirectly. JUDI
George Hoady, formerly Governor or ONO,
both Democrats, were the men who did the
business.