El Paso daily herald. (El Paso, Tex.) 1881-1901, 1897-10-25
UNION PACIFIC SALE.
The Inside Facts Given by Attorney
General Mckenna.

UeutTdl MCNtuud.
WASHINGTON, October %, 1897
The final effort of the democrats to
pre- iudice the people against the Nc
Kinley administration and Senator
Hanna has reacted against them and
| their own party with great force and
promptness.
This closing performance of their
campaign OF uncertainty in all things
except abuse and malignity was the
publication of a charge that in some
mysterious way Senator Hanna had
pledged the sale of the Union Pacific
| railroad to q syndicate of New York
bankers last year, and obtained in
exchange for that pledge large cam
paign contributions.
That this statement is absolutely
false is so apparent that Its effect has
already been a boomerang. 1t has
reacted upon its authors and upon their
own party.
The reason of this is twofold: First,
their statement has set people to look
ing up the matter, and they find that
the sale of the road was ordered by q
democratic administration. and that
the present administration had nothing
to do but merely to carry out the plans
originated and practically completed
by their democratic predecessors; sec
ond, that these plans only provided for
|
hence there could be no favOritism.
The precaution was taken to get an
agreement from certain parties that
Ger tain sum would be bid, in order to
prevent it's being knocked down at a
very low price, but this agreement
does not prevent others bidding, and it
is now understood that other bids will
be made.
1t is thus apparent that the entire
hullabaloo made by the democratic
press on this subject is merely for
effect upon voters IN the coming cleo
ton, knowing, of course, that a large
share of the voters have not followed
this question in detail, and that they
would not know whether the Stateme a
was true or false.
Autorney-Geueral McKenna, whose
integrity and high standing cannot be
called 10 question, said, in discussing
the matter:
s'The reorganization committee has
in no way been shown the slightest
favor or given the least advantage.
The road will be sold to the highest
responsible bidder, without any refer
ence to his personality. If bid of
SOL 100000 is made, and the reOrgani-
zation committee does not increase its
otter to So, 900, 0CO, the property will
60 to the parties making the new
proposal. The guaranteed bid was
obtained to prevent the possibility OF
disastrou. loss. If this guarantee did
not exist. an opportunity would be af-
forded for bidders to form a combina-
ton and offer a comparatively low
figure for the road.
"The increase in the reorganization
committees b d is easily explained.
Subsequent to the filing of the origin
al guarantee bid of S45, 754, O59 num-
Der of overlooked contentious were
discovered. These included the bridge
across the Missouri river at Omaha and
a number OF money considerations.
The bridge mortgages amounted to
about 81 200, 900, the lien on the Omaha
and Council Bluffs division to more
than $1,000, 900, and other contentious
brought the aggregate to nearly ST.
100000.
I'm view of these contentious the
DEGREES of the courts were unsatisfac-
tory and papers were prepared for an
appeal. AT that time the reOrganiza-
ton committee increased its bid by
81, 245 ,941 to cover these additional
sums, thus raising the total bid to even
$50, 600 600. In all other respects the
DEGREES were just and satisfactory"
Attorney General McKenna express
~ stipulates that there was no formal
agreement made between the govern
ment and the reorganization comm ttee.
The guarantee bid was arranged by
letters between former Attorney-Gen.
eral Harmon and special counsel for the
committee. The agreement, he says,
goes no further than to provide for the
appearance OF the government in suits
brought to forecIose the first-mortgage
bonds and to bring suit for foreclosing
it's own. The sale of the property. he
says, must necessarily be under the
direction of the courts, with the whole
world for bidders.
The encouragement cannot see
that the govern ment had any other
alter native than to become a party to
foreclosure proceedings after the
failure of congress to enact refundip e
legislation. With the foreclosure of
the first-mortgage bonds, he says, the
government would have had nothing
but an equity of redemption. In
other words, the government would |
have be en- forced to liquidate the OF
legations under the first mortgage in
order to protect its own interests. |
This course the former administra- |
/ ion considered ineXpedient and insti- |
tuted necessary legal proceedings to |
sell the road.
Judge McKenna does not express an |
option as to the prOpriety of the govern
ment having decided to become a !
party IN Joint suit. But that step |
having been taken, the government is |
amenable to the DEGREES of the court |
as a creditor. His present duty he re-
CARDS as plain-to permit all interests
In the road to be sold at public auction
to the reorganization committee or to
any body or association of PERSONS
in fact, to the highest bidder.
The attorney-general regards the
prospects of a higher bid than $50, 00O,-
900 to be as favorable now as it would