The Minneapolis journal. [volume] (Minneapolis, Minn.) 1888-1939, 1902-03-29
NEW MERGER
BILL IN IOWA
Blythe and the Burlington
Railway Lobby Do Not
Despair.
Hope to Meet the Objections
of the Governor in the
New Measure.
A Piece of Sharp Practice at
the Outset Causes Much
Criticism. h.
Special to The Journal.

Special to The Journal. .-s..- b.
Des Moines. Iowa. March 29.-The
Burlington railroad looby show ed its hand
plainly this morning and in the very be-
ginning ot it's fight to defeat the gov
ernor's veto of the Molsberry bill made
bad break. 1t was decided yesterday by
the Burlington people to amend the Mols-
berry bill so as to do away with its I'M
constitutional features, to which the gov
ernor had objected. and then take the
chance Of inducing the governor to re-
cede from his opposition on grounds of
public policy and sign the new measure.
In his veto message the governor very
plainly said that while the unconstitu-
tionaHty made it impossible for him to
sign the bill, yet there were reasons of
public policy that would compel him to
that course even If the bill were con-
stitutional. But the lobby has hopes Of
forcing him to sign a new bill which,
while being in different form will serve
the purposes OF the Burlington railway
company just as we'll. -
Molsberry's Latest. gs < -
Eafly in this forenoon's session Mols-
berry introduced the new bill. 1t pro-
vides that all Iowa railroads shall have
the power to incur debts by bonds or
Eotherwise, to any amount they may de-
sire, for any purpose indicated by their
articles of incorporation. Applied to the
Burlington railway company this would
give that corporation, with $4,000 paid up
capital, authority to incur any debt it
desired. -.-sa..s ..-.. -
When Hill, Morgan and their associates
bought control of the Burlington road
through the Northern Pacific and Great
Northern, they had to guarantee 8 per
cent interest on it's stocks. This was so
risky they would not hazard their pri-
vate fortunes to back the venture, SO
they organized the new Burlington rail-
way company under Iowa laws, with only
$4,000 capital paid up, and made it as
sumo all the immense liabilities by leas-
Ing the Burlington system and guarantee
ing it's fixed charges and dividends.
II the scheme should fail, they would
lose nothing, because the new leasing
Company has no Responsibility whatever.
But general creditors who had trusted
the company, by reason of their faith in
the name of the Burlington company,
might lose millions.
Something of a Scandal.
When the new Molsberry bill was in
troduced this morning, Senator Hobart,
chairman of the corporation committee
got it and at once attached to it re-
port signed by himself as chairman Of
the corporation committee, recommend
Ing that it pass. Inquiry developed that
the committee had been called together
last evening. A quorum was not pres
! ent, but it was represented that some of
those absent had agreed to stand by a
favorable report. The proposed bill was
shown and members were asked to au-
| thorize the chairman to attach a favora-
bic report as soon as the bill should
be introduced. They agreed to- this and
to-day it was done.
When the facts became generally known
there was much criticism 1t is under
stood no effort will be made to pass the
original bill over the veto, but all at
tention will be given to forcing the new
measure through. The action of the COM
mittee and the general disposition of the
lobby is causing something very much
| like scandal.