The morning news. [volume] (Savannah, Ga.) 1887-1900, 1897-10-19


It looks as II President Mckinley were
atout 20 involve his administrator in a
scandal Of huge proportions. The sale Of
Ire Umon Pacific railroad is fixed for
Nov g II was ordered by the court or
tre application q the government. The
government holds second mortgage bonds
On watch the road has not paid the inter
EST Its claim now amounts TO about S79.-
o. IL" There is a reorganlzsu1u commit
tee vaich proposes TO buy the road at
the sale This committee has agreed 70
bin s5lI10a5 for it, subject 70 the first
mortgage bonds. provided the government
zlu permit ths sale TO 20 on as a5ver-
Uses. II The reorganization committee
should get the road at ITS own price tine
government would lose s350s9l00.
But why should the government lose
anything. IL may Re asked. II the property
is worth 100000 above the first mort
gage bonds? The reason Is that under
The terms Of the proposed sale II b. about
Impossible for anybody or any syndicate
% raise sufficient money in 50 short a
tlEae 70 make the first and following pay
ments. How is II that the reorganizati1t
corumittee can raise the money! TheS
can DO IT, 50 il Is alleged. because they
control ali. or very nearly all, Of the hrss
mortgage bonds. These bonds are on De
posi-. with the committee. and. accordirr
70 the terms Of the sale. they can be
uze1 to make the first and subsequent
payments. The first mortgage bondhoI5-
org have agreed that the bonds may be
used for that purpose.
II IS alleged that there IS 10 doubt Of
the ability Of the road. If honestly and IN
teliisently managed. TO pay the Interest
On both the first and second mortgage
bonds. In the scheme Of the reorganiza-
lion committee it Is proposed TO issue an
amount Of bonds much greater than the
amount Of the first and second. mortgage
bonds. In addition 70 these bonds a great
deal OF stock, preferred and common. is
to be issued.
It is suggested that the administration
to save Itself from scandal. should pu,
OF the sale a month or six weeks, so
that parties who may want 10 bid for the
property may have time in
which to raise the money nee
eesary TO make the different payments.
It is alleged that there are parties who.
If given time, viii save the government
from any loss. If there is any founda-
ton for this statement the administration
cannot afford TO permit the sale TO take
place on Nov. 2. II II should do 50 there
would be a congressional investigation
which would make 1t very unpleasant foi.
the President and his advisers.
Ever since the government lent a help
ing hand 10 the Pacific railroads there
have been persistent attempts to rob It
Of the amount II loaned them. The gov
eminent was to have received first mort
gage bonds for the amount 1t loaned the
Union Pacific. II was finally induced to
accept second mortgage bonds. The
amount Of them is SS3Oo0.O)O. and there is
thirty years interest due on them-that
is. the government has paid the interest
for that length Of time. Besides these
bonds the government gave the road H.
| 10000 acres Of land on which more than
s3o. 10000 has been realized.
Great fortunes have been made out Of
the Union Pacific at the expense of the
government, and now it is proposed 10
beat the government out of $20.00O. 900 OF
its claim. The administration will be held
responsible If it permits the government
70 lose a dollar Of that claim.