The Saint Paul globe., 1899-12-18


do a paying business for years to come,
even if it had all the business of that
region, two rival railroads paralleled each
other for miles. There were over 700
miles of railroad built in 1887 in Western
Kansas, and in 1883 almost as much more.
The bonds of any railroad that built in
Kansas sold right away, and people vot-
ed rights of way with a reckless hand.
Some towns of 600 population had three
railroads built into them in one year
MONEY FROM THE EAST.
The mortgage loan companies that had
been in operation in the state for years
made tens of thousands of dollars profits
annually for several years, and their sue
cess created about $40 new money loaning
concerns. besides double as many more
individual agents for lending Eastern
money. Fourteen large money lending
concerns were In operation in Dodge City
alone, and one Of them handled over $780,,
coo Of New England money in 1887. Any
body who owned anything in the shape
Of real estate could borrow money in
those days. Not only borrow, but many
man tells how he was importuned by
the broker to borrow more than he asked
because the agent got a per cent on the
amount Of capital he put out. Everybody
borrowed, and the people who had no land
TO borrow on went and took up quarter
they had United States patent to it,
forthwith they borrowed to the full limit
of value Then they lived on the proceeds
for a year or two The mortgage indebt-
edneSS of the area now known as Sher-
man, Thomas, Logan and Wallace coun-
ties was $4,000 In 1885. -Four years later
1t was over $,700, 900.
John w. Breidenthal. state bank COM
missioner, says that the guarantees of in
A. 49,
Eastern investors, especially when adver-
tised in religious newspaper. One COM
pany at Topeka, with a capital of SIS, ,000
had guaranteed the interest on $l,S00,000
worth Of loans at one time, and there
were scores of similar instltu ions Banks
sprang up at cross roads, and they guar
anteed interest on their stocks and bonds
with reckless abandon, but they all faded
like mist two or three years later
Where there were twenty-five banks in
eight northwestern counties in 1899 there
are now two, and these are mere shadows
of the former concerns, on the ruins of
which the lesser ones have built in the
last few years. Every town of 900 and
more population had It's boom in town
lots, and 1t seems incredible today that
lots surveyed from the boundless plain,
one and two miles from communities of
1900 people, could have had a ready sale
merous instances Of square miles of real
estate out here, which were each valued
and had been mortgaged and sold for
over 900 twelve years ago, and can
be bought today for $4,000 and $4,000.
SO-CALLED FARMS.
The so-called farms out on the bleak
plains where only bunalo grass ever
grew, were valued at s., $780, 1900 and 1000
by the agent, and good, hard money
was loaned upon them at such valua tions.
The same lands were never fit for more
than grazing, and not one of the farms
is worth today over 500, and never Will be
more valuable. A lot of men asked for
loans Of $500 on their FARMS and were
asked by the agent to take $4,000 The
agent deducted his commission of 10 per
cent of the money paid on the property
when the money Was paid. Not one in
twenty Of these buffalo grass farms ever
had lick of work put upon them after
the money was loaned. When the East
ern mortgage came to find that his in
terest was not paid and that the taxes
and penalties and forfeitures had ac-
cumulated for several years, he generally
abandoned the investment as worthless.
He was wise there. But here and there
were some optimistic and hopeful mort
gagees who paid lot more money for
foreclosure, and then paid taxes for six
or seven years, all the while hoping that
the wheel of fortune might turn some
day and the land might become once more
worth at least the extraordinary valua
tion put upon it by the loan agent AL
most all Of them have lately been aban-
doning the land and letting it go for
taxes.
The strange thing about 80 per cent of
the loans made for Eastern people is
that the investors themselves had phe-
nomenal confidence in loan agents whom
they never saw and in property they had
absolutely no knowledge of except by the
tales told them in letters from agents
on the scene of operations.
ESTIMATE OF LOSSES.
The most conservative estimate of the
losses to Eastern holders of bonds issued
by Western Kansas banks cities, and
street railroad, electric light, water and
gas companies is now about Szl 100. O0O
but the best estimates are largely guesses
because so many cities that issued bonds
have now vanished, and banks and corpo-
ratons have gone away in the air. So
there IS often nothing to tell what amount
of bonds were sold or who bought them
The era of spending the money obtained
from Eastern mortgages, the expenditure
of money by railroad builders, and the
host of immigrants all bred an era Of
extravaganza and enthusiasm. Thus the
demand for lavish public improvements
came naturally to the mushroom towns
on the plains. One Improvement led to
another in strides toward city impor-
tance. When the new towns saw how
eagerly their Z per cent twenty-year
bonds were snapped up by Eastern banks
and brokers, 1t was easy to have a finely
equipped city in short order
Dodge City, with 5000 population, built
a great three-Story granite and marble
city hall, from 100000 worth of bonds sold
in New York city, and few months
later built water works and sewers with
$4,000 more of bonds sold in Boston. Ness
City which was entirely gone by 1895. got
a $4,000 school house, a $4,000 CITY hall
and $4,000 in water works and sewers
from her several bond issues Garden
City, with 1850 people, had a street rail-
road that would have been a credit to a
city of 1900 people when she was two
years old, besides a public hall worth
$685. 900 from sales of her municipal bonds
Now Garden City has about 800 people
Silver Bow, on the Rock Island & Pacific
railroad, waXed from seventeen people to
400 In exactly nineteen months and she
put over 100000 in her school houses CITY
hall, sewers and street railroad because
Eastern people bought Silver Bow bonds.
Silver Bow has not been on the map for
seven years. Then there were Rednard.
Wilcox, johnson, Richf1eld and dozens of
other little cities that were humming.
thriving spots in Western Kansas in 1888
and 1889. They each had their CITY halls
Of stone and pressed brick, with polished
oak furniture and interior woodwork.
their artistic opera houses and public
halls, with all modern accessories. their
water works. and some had street rail-