The semi-weekly messenger. [volume] (Wilmington, N.C.) 1897-1908, 1905-07-07

Soutter & Co been the financial
agents of the state, and now these
were discharged and Clews & Co. sue
Ceeded them.
An agreement was made by the rail-
road presidents to the effect that thes
should go into a pool and use their
bonds on hand as a margin, and that
certain other parties should go in with
them to make the movement lively and
create the impression that there was
an extensive and more general demand
for the bonds. The pool being formed,
Andrew Jones, Littlefield, Swepson and
Branch 4 Co. put their bonds with a
firm styled Utley & Dougherty as a
margin to carry out this programme.
And the speculation began. Latin,
Martindale, Moore and others were
also parties to the speculation.
1t was agreed that the treasurer
should make advertisement that the
interest then long in default would be
Paid on presentation of coupons i'm Raj
eigh, and the spectators agreed to
furnish him with the cash to pay the
interest. Besides, the treasurer had
replaced the S150,OOO borrowed from
the Educational Fund, and that was
used to buy bonds and bull th- market.
And $125,OOO derived from tie sale Of
land scrip for an agricultural college
was used in the same way. Under
such manipulations the bonds advance
ed a few cents: but just as the specu-
lation was beginning to work, the gold
panic OF that year set in, and sudden
ly all sorts of stocks and bonds declin-
ed, and in a few days the ruin was
complete. The loss on margins seems
to have been somewhere in the neigh
horhOod of 100000. The bonds depos-
tied as margins were sold for a song,
and the whole issue of special tax bonds
for internal improvements petered out.
Andrew Jones, president of the
Western railroad, did save enough to
lose a batch at faro, and Josie Mans
field, a noted courtesan of New York,
it appears, got her share out of the
wreck.
It was a Waterloo for the North
Carolina railroad presidents, and dis
%astrously involved Swepson, who had
entered into the affair with a large pri-
vate fortune at his back. He retired
from the presidency of his railroad
and Littlefield was elected in October
as hil successor, and the funds Of that
company were absolutely dissipated.
Jones had nothing to show for the
bonds of his company, while DR.. Sloan,
who was late in getting his bonds from
the treasury, refused to share in the
losses of the pool and deposited his
bonds with Pickerel & Co., from
whom he was never able to redeem
them. The whole issue was lost. By
their breach of trust the railroads de-
rived no benefit from the bonds; nor
did the state.
Quickly following these events the
again convened in regular
session. The few Democrats in the
body were active and aggressive. But
the leaders of the Republican party
were determined to retrieve the disas-
ter, if possible. They pointed out that
but $14, 000, 900 Of special tax bonds had
been issued, and the taxes were COM
ing in to pay the interest. that the
entire state debt was but $4,000 0 600,
and what was that to North Carolina?'
That there was only one road open,
and that was to press On. Sustain the
credit of the state; tax the people; pay
the interest, and look to the future
SfSIOpIuChL VI tHC SldIC " SCLLIC ldC
principal. But the people were not ST
complaisant.
The public mind was greatly excited.
At once measures were introduced in
both houses covering the whole ground
Of the special tax bonds. Resolutions
to investigate railroad frauds; bills to
protect the interest of the state ana
to require accountability on the part
of railroad officials; bills forbidding
the payment of interest and arresting
the collection of special taxes; bills
the treasurer to issue any
bonds and requiring the railroad
presidents to turn into the state treas
ury all on hand undisposed OF, and
repeating all of that legislation.
The excitement was intense. The
in the Legislature, backed
by a tremendous public sentiment.
pressed these measures and were hear
tily and zealously aided by those Re-
publican members who had clean
hands and proposed to rescue the state
from the pile of proitless debt that
had been accumulated so recklessly.
Charges of corruption and fraud
that had been whispered came TO be
spoken, and the question went
round who had borrowed money
from Litlefield or Swepson?"
One week after the organization,
Mr.. Pou, of Johnston, moved that the
House go into committee of the whole
to investigate these matters, and at
ter a struggle the motion was carried,
and the next day the committee Of the
whole House sat. The developments
were slow. The committee had 10
send for papers and witnesses. OBJ
structions were i~nterposed at every
step. 1T was NOT until after the Christ
mas recess that work was begun In ear
most