Year: 1879

nounced submitted for consideration even to the
Executive Committee of the Board of Directors.
much less to the full Board, and finally put in
force the utter surprise of the public the
bal authority, far be ascertained. of the
President and single director. 1t is unnecessary
to comment on such method OF corporate
management. 1t speaks for itself Mcan-
while, so far as the measure is concerned.
the objections to it are apparent. The
through business over the Union Pacific is mainly
done by large houses. This is natural enough for
such houses can of course do it most cheaply. The
measure under discussion. however, made 1t impos-
sible that this business should be done by any but
the large houses They have special contracts Gov
actions. which, more than all Others. should
be public The special S may b be as
have every to believe that they are but they
the less lacking in that element of publicity
which i'll such matters will always remain the one
real safeguard against determinations.


GIVE THE PUBLIC SOME BENEFIT.


The report contains the following interesting pas
sage concerning the recently enacted Funding law


Before passing from the consideration OF the policy
pursued by the Union Pacific in its relations with the
touching the course which Congress has adopted
toward that company which 1t seems necessary to
nected with the construction of the road as well
as from the fact that the United States
government is its largest creditor. Congress has
always been in position to exercise great if not
controlling influence it. 1t might through a
conservative and Intelligent public supervision have
developed the idea of responsibility in the manage
lnent and compelled the adoption of such a liberal
and far-sighted policy as the directors have en-
deavored to suggest. In doing it would naturally
have looked to the increased benefits to be derived
from the more rapid development of the country to
reimburse the government Tor its outlays on the en-
terprise rather than to any immediate cash repay
ments out of profits be derived from pure money
making system of tariff charges based hard blls
ness principles 1t seems fairly questionable whether
by its recent legislation Congress has not committed
itself in certain degree to another and
less liberal course. BY the act Of May 7. 1875
monty known the Pacific Railway Funding bill the
government would seem to have given its formal
approval to the present business policies of both
those corporations by insisting on having share of
their results. In the report which accompanied that
act the Senate Judiciary Committee very distinctly
rest it on the large net earnings of the roads
ion that those earnings ..wl be largely increased
i'll the future, and again that they in the future will
Those net earnings in part were. however. and if
maintained they will i'll the future continue to
be the direct result of that policy the
part OF those managing the Union Pacific
which the directors in this report have
felt it their duty to criicise The directors have al
ready intmated their belief that the percentage Of
earnings ttyeght per cent earned by the Union
Pacific during the last three years is
siderably larger than it should have been.
policy respects renewals and local business
development would unquestionably for some years
m int
influence to that end. Meanwhile, the legislation
referred to would seem to sanction the wholly diff
ferent policy in the unnaturally large results of
which it is proposed to its far share the
national Treasury.


A STRANGE GOVERNMENT POLICY


The government becomes, in short, of the prin-
cipal benehcares from system of railroad manage
ment which is. TO say the least in respects
just, in many respects harsh and in nearly all re-
spects iliberal to its own citizens While the gov
ernment occupies this position it would seem diff
ately in the direction OF the company to exercise
any considerable influence in favor OF policy
liberal. but less Immediately profitable. The govern
ment directors of opinion that consolidation of
tine Union racine road with Its connect
ing "branch lines is not now desirable
in the public interests but they recommend
"that the companies be compelled to submit their
differences on the subject Of prorating to the
decision of some impartial board of arbitrators.
Of Secretary Schurz for legislation which shall
enable the government to cede to the
railroad company all the sections of grazing or desert
lands on one side of the road and receive from
it all the similar sections the other, in
order that each party may dispose of these lands
large tracts, in which alone they desirable or
susceptible of profitable rise by purchasers"


CHARLES FRANCIS ADAMS GIVES HIS REASONS


FOR REsIGNING AS DIRECTOR ALTOGETHER


DEFECTIVE sysTEM-HoNEsr CRITICISM


ALMOST IMPOSSIBLE.


WASHINGTON, Jan. 4, 1879.


The resignation of Charles Francis Adams. Jr as
of the government directors of the Union Pacific
Railroad has not been accepted, nor has the
selection of his successor been considered.
As the Office is an annual one, and the
regular time for the appointment Of a new
board is only two months distant, it is probable
that the vacancy to be created by the acceptance
Mr.. Adams resignation will be left untitled till that
time.


In his letter of resignation addressed to Secretary
Schurz Mr. Adams not only states the considera-
tions of personal convenience which compel him to
resign. but makes some severe and pertinent criti
cisms upon the methods of railroad supervision
and control adopted by the government for the
protection of its interests He admits that the Board
of Government Directors has almost entirely failed
to accomplish the results which expected from
it, and he assigns his reasons for its failure


Eiyst-That its members induced to accept the
positions they occupy by considerations which did
not furnish motives strong enough to insure the
thorough and faithful performance of their du
ties; that they became directors for public
spirited reasons, or "for the honor of the thing
or for the special privileges conferred upon them
the way of free travel and not as they should have
done for adequate compensation. As a natural con-
sequence they did not give and could not be ex-
pected to give the attention to their duties that
they would have considered necessary had they
received "a proper equivalent for the services
which they rendered and the responsibilities which
duties imposed upon government director one must
give to them his undivided time and attention and
laboriously acquire full and competent knowledge
of all the ntricaces of railroad situation which
probably a. singular as any which exists in the
world. The annual examination of the road
Tor instance, which the government requires is of
itself task which neccssitates thorough familiar
ity with the details and standards of
and construction. and which cannot be properly
made at greater rate of speed than fifty at
most hundred miles day. Such an
inspection of the Union Pacific road. Mr.. Adams
believes. has been made; certainly since he
has been a member of the Board. II private per-
son u corporation should induce and appoint
agents to look after his ts interests in the
adopted by the government, the result, he declares
would be speedy bankruptcy.


SecOnd-lhe position OF government director is
made of additional difficulty and embarrassment
by the fact that his compensation comes from the
party which must necessarily suffer from the faithful
performance of his duty. He is the guest of the
poraton lives at its expense accepts every possible
attention and hospitality from officers and is
paid out OF its treasury. and ut the time he is
expected to criticso openly and truthfuy all de-
fects and shortcomings. AS long as this system
tnues IL is practically inevitable that nothing but
services of purely formal character be- expected
The active government director is at best only an
honorable spy.


MIR Adams then what ha ,ks 20 h. fln