The Washington herald., 1908-07-30
FEDERAL AID REPAID
Western Railroads Are Hon
est Debtors.
ONLY ONE LOAN STILL UNPAID
Policy of Government Help for the
steel Roads Into the UndevelOPed
West Has Been Justified by Re-
endorsement of Money and Great
Development that Followed

The payment Tuesday Of the last Of the
notes due to the government by the Cen
trsI and Western Pacific Railroads left
less than s4,eoo,oo1 due 70 the Federal
government on account Of the aid eX-
tended 10 Western railroads for construc-
tion purposes nearly a half century ago.
When it was proposed that the United
States government should aid in the con
struction Of trans-continental railroads
by an issue OF bonds and by guarantee
ing the interest on the bonds. bitter OD-
position was encountered. and a lobby
sprang into existence in Washington
which provided one Of the greatest
scandals Of the time Some OF the lead
ing statesmen Of the day refused 70 be
lIeve in the future Of the great West.
despite the gold discoveries IN California
and the prosperous settlements in oregon
and Il was freely predicted that a rail-
road extending from the Mississippi
River 10 the Pacific Coast would never
prove a paying proposition
Only one Of the six roads which were
aided by the government has failed TO
pay its Indebtedness in fun. This is the
Central Branch. Union Pacific. which Te-
ceived aid 10 the extent Of cuIy Sl.503.0o0
The interest accrued brings the amount
UP 10 Ss.s7S. S.lg7.52. there having been some
slight deductions on account Of trans
portati0n performed for the government
All the big roads have paid their inde5t-
edness IN full. the last payment being
that Of the Central and Western Pacific
Tuesday in the form Of check FOR the
i twentieth of It's S2.s40es5 notes, with IN
terest Thus the policy OF government
aid 70 railroads in the SOS has been vim
dicated after a period OF little more than
! forty years.
Aided Roads Arc Prosperous.
Nearly all the roads aided by the gov
/ ernmont are now in 8 highly prosperous
/ condition. and some Of them are among
the richest in the country The Central
/ Branch. Union Pacific. which Is now the
only debtor. and that in a comparatively
/ small amount, has never been a paying
I property. and there IS no prospect that
the loan Of Sl.eOo0OD VIII be repaid 20 The
/ government in the near future. The
I government IS able 10 reimburse Itself
Z 20 small extent occa si0naI'y by the free
7 transportation OF troops and government
freight over the line. but this does not
amount 70 as mucn as Jne current II
{ tercsr-
The Indebtedness % the Pacific rail-
roads on account Of bonds was In the az.
gregate. interest included. sl2s. .045. .252. or Z
little more than the first authorization oi
bonds for the construction Of the Panama
Canal IN all cases no payments wer'
made 10 the government until after tbs
interest had accumulated 70 an amoul
larger than the principal. for there wa
I a period OF many years when the West
ern roads were UnprOsperOus and ever
bankrupt. The original loans were a.
follows Union Pacific. 81. .Z35.512; Contra
and Western Pacific. 81. 50. So; Kansa.
I Pacific. $500 600; Sioux City and Pacific
s.. So. $50. Central branch. Union Pacific
s. 5000
Interest Was S3I. 100000
The interest on the Union Pacific loai
amounted 10 more than 81. .001 900 befor
any money was repaid 20 the govern