SPEECH 
 
 OP 
 
 HON. ISAAC M. JORDAN. 
 
 $ 
 
 r— 
 
 > 
 
 V/ 
 
 r 
 
 % 
 
 j 
 
 & 
 
 The House having: under consideration the bill (H. R. 6771) to amend an act 
 entitled “An act to aid in the construction of a railroad and telegraph line from 
 the Missouri River to the Pacific Ocean, and to secure to the Government the 
 use of the same for postal, military, and other purposes,” approved July 1, 1862, 
 also to amend an act approved July 2, 1864 — 
 
 Mr. JORDAN said: 
 
 Mr. Speaker: Whatever doubts there might be, as an original ques- 
 tion, as to the power of Congress under the limitations of the Constitu- 
 tion to make grants or donations of lands for public improvements, the 
 power has been so long exercised that it is no longer a debatable ques- 
 tion. 
 
 The policy and practice of Congress making these grants for the pur- 
 pose of aiding in the construction of public improvements has prevailed 
 from the earliest history of the country. They were made during the 
 administrations of Adams, Jackson, Van Buren, Tyler, Polk, Fillmore, 
 Lincoln, and Grant. Some were made for railroad purposes prior to 
 1850; and between 1850 and 1880 grants of the public lands for rail- 
 road purposes were made amounting to more than 150,000,000 acres, 
 and patents have in fact issued for more than 50,000,000 acres of these 
 lands. 
 
 The purpose which Congress has intended to accomplish by this dis- 
 position of the public domain has been the opening up of the Western 
 Territories to settlement, the encouragement of emigration from the 
 more thickly settled States, the development of the mineral and other 
 great resources of the country, the building up of new political commu- 
 nities, and their admission into the Union as States. And it is a singu- 
 lar and interesting fact that while most of the original States made large 
 cessions of lands to the Federal Government, none of them have ever 
 asked or received any donations out of these lands. They have been 
 made entirely in the interest of the Western and Southwestern States. 
 
 The rapid and marvelous development of all these States is attribu- 
 table in a large degree to these grants. More than 10,000 miles of rail- 
 road have been built from the proceeds of lands so granted, and wher- 
 ever these roads have been constructed towns and cities have sprung 
 up like magic, the expectations of the Government have been more 
 than realized, and the national Treasury has received indirectly far 
 more than it would have done by the sale of the land itself. 
 
 to 
 
 
 BUREAU j 
 
 WASH IN 
 
 / dCONOMlGS, 
 
 CTON, D C. 
 
 HOPUm", | UMIY 
 
 IN tACHAH* 
 
 JUN 3 0 1911 
 
4 
 
 1 
 
 Grants of this kind were made by Congress in the following States 
 and Territories from the year 1850 up to the year 1880: 
 
 Illinois 
 
 Mississippi ... 
 
 Alabama 
 
 Florida.. 
 
 Louisiana 
 
 Arkansas 
 
 Missouri 
 
 Iowa 
 
 Michigan 
 
 Wisconsin.... 
 
 Minnesota.... 
 
 Kansas 
 
 Nebraska 
 
 Colorado 
 
 Nevada 
 
 California 
 
 Oregon 
 
 Dakota 
 
 Wyoming .... 
 
 Montana 
 
 Idaho 
 
 Washington . 
 
 Utah 
 
 New Mexico 
 Arizona 
 
 Acres. 
 
 2, 595, 053. 
 1, 137, 130 
 2, 807, 648 
 1,700, 467 
 1,256,43a 
 2, 613, 631 
 2, 605, 251 
 4, 181, 929 
 3, 355, 943 
 3, 553, 865 
 9, 820, 450 
 8, 223, 380 
 6, 409, 376 
 
 3. 000. 000 
 
 4. 000. 000 
 
 16. 387. 000 
 
 5. 800. 000 
 
 8 . 000 . 000 
 
 4. 500. 000 
 17, 000, 000 
 
 1.500.000 
 
 11.700.000 
 
 1. 850. 000 
 
 11.500.000 
 
 18.500.000 
 
 Total 154,067, 553 
 
 At the time, therefore, that the grants were made to the Union Pa- 
 cific and Central Pacific Railroad Companies, although they were much 
 larger than ever had been made before, no new policy was inaugurated 
 by Congress; on the contrary, they simply followed a policy which had 
 been adopted early in the history of the country. The first public 
 man whose prophetic vision saw the future of the great West, and the 
 importance of the Government taking steps to aid in constructing a rail- 
 road to the Pacific, was Stephen A. Douglas. As early as 1845 he pre- 
 pared a bill to organize the Territories of Nebraska and Oregon, and to 
 reserve to each of said Territories alternate sections of land forty miles 
 in width on each side of a railroad from the Missouri River to the Bay 
 of San Francisco. 
 
 After the admission of California the construction of a transconti- 
 nental road was continually under consideration in Congress. These 
 measures all looked to the granting to said road of the public lands, 
 and making them the carriers of the Government mails and other prop- 
 erty. And from that time to 1856 the Government made surveys of 
 and considered at least five different routes for that purpose. The 
 Democratic and Republican parties demanded its construction in their 
 party platforms, and Buchanan, in 1856, and Lincoln, in 1860, recom- 
 mended the matter in their messages to the favorable consideration of 
 Congress. 
 
 President Buchanan suggested long before the war that it be paid for 
 in money and lands. In his message to Congress, December 6, 1858, 
 he said: 
 
 It would be inexpedient for this Government to exercise the power of con- 
 structing the Pacific Railroad by its own immediate agents. The construction 
 of this road ought therefore to be committed to companies incorporated by the 
 States, and Congress might then assist them in the work by grants of land or 
 money, or both, with conditions and restrictions as to transportation of troops 
 and munitions of war free of charge, and the carrying of the mail at a fair 
 price. 
 
 
5 
 
 Indeed, the construction of such a road, in view of our settlements 
 upon the Pacific coast, became inevitable. It was impossible that in a 
 country like ours our people would consent long to the inconveniences 
 of an overland route requiring more than thirty days to go from the Mis- 
 souri River to San Francisco, a route made dangerous by Indians and 
 robbers, and which made the cost of transportation almost incredible. 
 This road would have been built whether the war had come or not; 
 hut the war had much to do with its construction and with the char- 
 acter of the grant and subsidy given to the road, for without these it 
 never would have been built. 
 
 What, then, were the circumstances which brought about the build- 
 ing of this road and the liberal subsidy and grant made for that pur- 
 pose ? 
 
 In April, 1861, our civil war commenced. On one side were arrayed 
 all the Northern States, and on the other side all the States from Mary- 
 land to the farthest border of Texas. The territorial dominion of the 
 Southern confederacy embraced about one-third of the United States. 
 This conflict soon assumed vast proportions, and the Government found 
 itself engaged in a great conflict for national existence. European na- 
 tions, long jealous of our great prosperity, stood ready to take advan- 
 tage of our condition in any way that seemed favorable to them. Eng- 
 land was in strong sympathy with the South, and France was ready to 
 obtain a foothold on this continent if possible. 
 
 As early as 1862 the French landed an army of invasion in Mexico, 
 and, taking advantage of the party strifes in that unhappy country, 
 were soon able to establish a monarchy on the ruins of the Mexican 
 Republic. The Congress of the United States were well aware of this 
 danger. They saw that our Western Territories were in peril. They 
 saw California hesitating in her loyalty. They saw that the permanent 
 occupation of Mexico by France was a barrier to any further extension to 
 our territory south; that it threatened our control of the Gulf of Mex- 
 ico, and made communication with California by water impossible with- 
 out the consent of the French Government. 
 
 The construction of a railway across the continent connecting us with 
 the Pacific States became an absolute necessity as a matter of national 
 defense. The road had to be built. The Government had no money 
 with which to build it. Her constitutional power to do so was doubtful. 
 Our credit was impaired; gold and silver had gone out of circulation; 
 a paper currency had taken its place; we were issuing our bonds by the 
 hundreds of millions; the faith and property of the nation were pledged 
 to their payment, and yet our bonds were selling at far below par. In 
 this state of affairs Congress was in a condition to be liberal to any 
 individuals or corporations who would undertake the hazard and ex- 
 periment of constructing this road through a wilderness inhabited by 
 the Indians, over deserts uninhabited by man, and over mountains cov- 
 ered with perpetual snow. 
 
 Under these circumstances, the Congress of the United States, on the 
 1st day of July, 1862, passed the act for the construction of a road from 
 the Missouri River to Sacramento, 2,000 miles in length, by the Union 
 and Central Pacific Railway Companies. By this act Congress proposed 
 a grant to said companies of a right of way two hundred feet wide, more 
 than 2,000 miles long, all necessary lands for depots, &c., and a dona- 
 tion of five alternate sections per mile on each side of the road for a 
 width of ten miles, to extinguish all Indian titles which might interfere 
 with the grant, and to loan to said companies its bonds at the rate of 
 
6 
 
 $ 16, 000 a mile where the road was easy of construction, and for three 
 hundred miles through the Rocky and Sierra Nevada Mountains at 
 $48,000 a mile, and for one hundred and fifty miles at the rate of $32,000. 
 a mile. 
 
 This seemed a princely offer, but such was the condition of the coun- 
 try and of its finances, such the hazards of the undertaking, such the 
 timidity and conservatism of capital, that the companies were unable 
 and unwilling even on these terms to build the road, and the Govern- 
 ment saw two years pass by and nothing done toward the' construc- 
 tion of this great road. Such being the condition of affairs, it prob- 
 ably never would have been built had it not been for what was going 
 on in Mexico. While we were engaged in our own conflict, which 
 strained every nerve and taxed every resource, France was completing; 
 her conquest in Mexico and arranging to place Maximilian on the 
 throne, and the United States, with shame, humiliation, and mortifi- 
 cation, on the 12th of June, 1864 (nineteen days only before the amend- 
 ing act of July 1, 1864, was passed), saw Maximilian enter the City of 
 Mexico amid the acclamations of the Mexican people and made emperor 
 of Mexico. 
 
 At this time what was the condition of the United States ? Our na- 
 tional debt had reached the immense sum of seventeen hundred and forty 
 millions of dollars. The credit of the Government was greatly impaired 
 at home and abroad. Sherman had met with a severe repulse at Kenne- 
 saw Mountain. Grant had been unsuccessful at Spottsy lvania, and had 
 met with severe disasters at Cold Harbor. One hundred thousand men 
 had been lost in three months. Lincoln was about to call for 500,000 
 more soldiers. This, indeed, was the supreme hour of the war. In this 
 great national trouble, with civil war endangering the life of the nation 
 at home, with California hesitating in her loyalty, with Indian raids 
 and troubles upon the frontier, with France violating the Monroe doc- 
 trine with impunity and placing Maximilian upon the throne in Mexico, 
 was it a very remarkable or extraordinary fact that the Government or 
 Congress of the United States should have offered such large induce- 
 ments to her citizens and capitalists in order that a great military high- 
 way might be constructed which would connect the eastern and west- 
 ern parts of our vast dominions? 
 
 It may be well to quote here what was said by Justice Davis on be- 
 half of the Supreme Court of the United States in deciding the case of 
 The United States v. The Union Pacific Railroad, as reported in 91 
 United States Reports, page 79. He said: 
 
 Many of the provisions in the original act of 1862 are outside of the usual course 
 of legislative action concerning grants to railroads, and can not be properly 
 construed without reference to the circumstances which existed when it was 
 passed. The war of the rebellion was in progress, and owing to complications 
 with England the country had become alarmed for the safety of our Pacific 
 possessions. 
 
 The enterprise was viewed as a national undertaking for a national purpose, 
 and the public mind was directed to the end in view rather than to the particu- 
 lar means for securing it. Although the road was a military necessity, there 
 were ot her reasons active at the time in producing an opinion for its completion 
 besides the protection of an exposed frontier ; there was a vast unpeopled terri- 
 tory lying between the Missouri and Sacramento Rivers which was practically 
 worthless without the facilities afforded by a railroad for the transportation of 
 persons and property. With its construction the agricultural and mineral re- 
 sources of this territory could be developed, settlements made where settlements, 
 were possible, and thereby the wealth and power of the United States largely 
 increased; and there was also the pressing want, in time of peace even, of an 
 improved and cheaper method for the transportation of the mails and of supplies 
 for the Army and the Indians. 
 
 
7 
 
 It was in presence of these facts that Congress undertook to deal with the 
 subject of this railroad. The difficulties in the way of building it were great 
 and by many intelligent persons considered insurmountable. 
 
 The scheme for building a railroad two thousand miles in length, across 
 mountains, over deserts, and through a country inhabited by Indians, jealous 
 of intrusion upon their rights, was universally regarded at the time as a bold 
 and hazardous undertaking. It is nothing to the purpose that the apprehended 
 difficulties in a great measure disappeared after trial, and that the road was 
 constructed at less cost of time and money than had been considered possible. 
 No argument can be drawn from the wisdom that comes after the fact. 
 
 The project of building the road was not conceived for private ends, and the 
 prevalent opinion was that it could not be worked out by private capital alone. 
 It was a national work, originating in national necessities, and requiring na- 
 tional assistance. 
 
 At the time the Pacific railroads were chartered and these grants 
 made we were carrying on a great war, and this was regarded as a war 
 measure, and seemed to be a proper exercise of power under the cir- 
 cumstances which then surrounded us. Now we are in the midst of 
 profound peace, and no man in his senses would contemplate for a mo- 
 ment making such extraordinary grants of the public domain for such 
 purposes, and no political party would now favor it. What seemed 
 proper then would he improper and impossible now. Indeed at this 
 time we are pursuing the far better and wiser policy, and instead of 
 disposing of our public lands in large quantities to railroads or for- 
 eign syndicates, we are reserving them as rewards for the valor of our 
 soldiers and as homes for those of our people who will settle upon 
 and improve them. 
 
 Mr. Speaker, Congress in making these grants was governed by the 
 exigencies of the times, and did what seemed best for the interest of 
 the whole country. The object intended was national defense and the 
 perpetuation of the Government. 
 
 Congress had more than one object in view in having these Pacific 
 railroads built. 
 
 First. It desired to have a railroad built at once, over which it could 
 carry troops, Government supplies, &c. , in case of war with France, 
 Mexico, or if necessary in connection with our civil war or trouble 
 with the Indians. 
 
 Second. It desired a permanent postal and military road under Gov- 
 ernment control. 
 
 Third. It wanted to develop the great mineral resources of that vast 
 Western country. 
 
 Fourth. It had in view the opening up of the whole of our Western 
 territory to settlement, the building up of new communities and States, 
 and increasing the wealth and power of the country. 
 
 Fifth. It expected to cheapen the expense of carrying the mail and 
 Government supplies in the West. 
 
 Sixth. It believed that the construction of such a road would enable 
 it to control the Indian problem. 
 
 And all these results have been more than accomplished. 
 
 THE OBJECT OF THE GOVERNMENT. 
 
 The object of the United States was not to make an investment or 
 loan of money nor to make a profit; neither was it its principal object 
 to obtain payment for the lands granted or to secure the money or 
 credit which it loaned the companies. The object ot Congress was a 
 much higher and more importantone, as will be found in the title and 
 in almost every section of the act creating the same. The title of said 
 act is as follows: 
 
 An act to aid in the construction of a railroad and telegraph line, and to secure 
 to the Government the use of the same for postal, military, a nd other purposes. 
 
8 
 
 The sixth section of said act makes the grant upon condition not 
 merely that the companies shall pay the bonds at maturity, but that 
 ‘ ‘ they shall keep said railroad and telegraph line in repair and use, 
 and shall at all times transmit dispatches over said telegraph line, and 
 transmit mails, troops, and munitions of war, supplies and public 
 stores upon said railroad for the Government, whenever required to do 
 so by any Department thereof, and that the Government shall at all 
 times have the preference in the use of the same. ’ ’ 
 
 The twelfth section of said act provided that ‘ ‘ the track upon the 
 entire lines of said railroads and branches should be uniform, and the 
 whole line of said railroad and branches and telegraph shall be oper- 
 ated and used for all purposes of communication, travel, and trans- 
 portation, so far as the public and Government are concerned, as one 
 connected and continuous line. ’ ’ 
 
 The seventeenth section provides that in case said railroad companies 
 should fail to comply with the terms and conditions of the act by not 
 completing the road, branches, and telegraph within a reasonable time, 
 or by not keeping the same in repair and use, Congress might pass an 
 act for the speedy completion or repair thereof, and appropriate the 
 income of the road for that purpose. 
 
 The eighteenth section makes still more important and further res- 
 ervations. Indeed, so much more important were these reservations by 
 the Government of rights and powers over these roads than the money 
 loaned to the companies, that Senator Thurman declared in the Senate 
 of the United States that he would rather see the Government relin- 
 quish all claims to the bonds and interest loaned or paid for these com- 
 panies than to release or surrender the power and control which it had 
 reserved, by the charter over them. His language was: 
 
 I affirm, as I have affirmed before, that this Government had better lose every 
 dollar due and all that is to become due to it by these companies than to give 
 up the right which it has to alter, amend, or repeal the charter. 
 
 During the discussion of the matters relating to the land and bond 
 subsidies in the Senate, Senator Wade, of Ohio; declared that he cared 
 but little whether the Government ever received payment of a dollar 
 of the money loaned these companies; that the Government would be 
 more than compensated in what it would receive from the opening up 
 of the country, the founding of new States, and that, as a matter of 
 national defense, this road was an absolute necessity. Similar senti- 
 ments were expressed on the floor of the Senate and by members of 
 the House and by almost the entire press, and the whole country was 
 in hearty sympathy with this view and purpose. I have thought, Mr. 
 Speaker, that, in view of the attacks which have been made upon those 
 who were connected with the making of these grants, it was only 
 right and just to call attention to the times and circumstances under 
 which these subsidies were made. And I believe that by so doing we 
 will be better able to understand and interpret the several acts relating 
 to these roads. It is said that some members of Congress were induced 
 to vote for the act of 1864 by improper considerations. This may be 
 true, but Congress has not chosen to repeal these acts, the courts have 
 not set them aside, but they have been admitted to be valid by the 
 courts and by every Department of the Government, and to constitute 
 a binding contract between the companies and the Government; and it 
 is too late therefore to plead these matters now. So far as we are con- 
 cerned in this case, we must deal with these as with any other acts of 
 Congress, and we must respect them the same as if passed by ourselves. 
 
9 
 
 Indeed, as was said by the Supreme Court of the United States in the 
 case of Fletcher v. Peck, hereafter cited: “The acts of the supreme 
 power of a country must be considered pure for the same reason that 
 all sovereign acts must be considered just, because there is no power 
 that can declare them otherwise. ’ ’ 
 
 Mr. Speaker, the Pacific Railroad Committee have had under con- 
 sideration for some time the subject of the relation which the Govern- 
 ment sustains to the several Pacific railroads which are known as the 
 bond- subsidized roads, and the best means of obtaining security for the 
 amount owing by said railroads, and of ultimately obtaining payment 
 of the entire indebtedness. 
 
 Two bills are now before the House for consideration and action. 
 The one presented by the committee contains two main propositions: 
 
 First. The extension of the Thurman act, not only over the Union and 
 Central Pacific roads, to which it .already extends, but also over the 
 Kansas Pacific, the Central Branch of the Union Pacific, and the Sioux 
 City and Pacific Railroad; and the requirement that each of these roads 
 should pay into the sinking fund, created under the Thurman act, 35 
 per cent, of its net earnings, instead of 25, as at present required. 
 
 Second. To appropriate to the payment of the Government indebted- 
 ness all the money which the Government owes to any of said roads, 
 or may owe them for transportation on any of its roads whether aided, 
 owned, leased, or operated by .said companies. 
 
 This plan is one which looks to compelling these companies to pay 
 to the Government a larger amount from year to year than the condi- 
 tion of the companies will justify, provided they keep up their roads, 
 pursue the policy which they have been pursuing in reducing the rates 
 for passenger and freight transportation, and in .con tending and main- 
 taining themselves against competition of rival roads. But this plan 
 makes no provision for the payment or the extinguishment of the debt 
 owing by these companies to the Government at the time of the ma- 
 turity of the indebtedness, which will be in the year 1898; and the un- 
 paid balance at that time, it is believed, will amount to not less than 
 $75,000,000. 
 
 It was for the purpose of meeting this great and radical defect in the 
 bill of Mr. Thompson which has led us into the consideration, devel- 
 opment, and advocacy of the plan, clear, plain, and simple, by which 
 these companies could be induced or required to give to the Govern- 
 ment additional security for its indebtedness, and by which the pay- 
 ment of the debt would be insured beyond a reasonable doubt. We 
 believe that we have completely accomplished these purposes by the 
 bill of Mr. Post. It provides — 
 
 First. That the Secretary of the Treasury shall ascertain as of the 
 date of October, 1884, the present worth of the indebtedness to the 
 United States of said subsidized roads, after deducting any amounts 
 paid thereon or in the sinking fund to the credit of said companies. 
 
 Second. That the Secretary of the Treasury shall divide the amount 
 so found into a hundred and twenty parts, and receive from said com- 
 panies a hundred and twenty bonds of each of said companies, payable 
 in semi-annual installments, with interest at 3 percent, per annum, and 
 providing for the payment and extinguishment of one of said bonds 
 every six months, with a proviso that said companies should receive 
 no Government pay for transportation over any of their lines owned, 
 leased, or operated until the bond next becoming due shall be paid. 
 
 Mr. BLOUNT. Will my friend allow me to ask what would be the 
 
10 
 
 difference in the amount paid to the Government by these roads under 
 that proposition and the amount which the Government has been re- 
 ceiving from them ? Of course we can not tell about the future. 
 
 Mr. JORDAN. I will state in regard to that in a few minutes, and 
 then give a direct answer to the question of my friend. 
 
 Mr. BLOUNT. Of course I do not care when it is answered. 
 
 Mr. JORDAN. I will answer it in a few minutes; it will become a 
 necessary part of my argument to answer it. 
 
 Third. That the statutory lien or mortgage created under the acts of 
 July, 1862-’64, and the security created by the Thurman sinking-fund 
 act of May 7, 1878, together with a further lien on the whole line of 
 said companies, whether owned, leased, or operated by them, including 
 rolling-stock, fixtures, &c., should be and remain as security for the 
 payment of said bonds so to be executed. The companies have under 
 this provision the right ter pay up the whole of the indebtedness at any 
 time. The said bill contains other and important provisions looking to 
 the preservation of all the other rights held by the Government under 
 existing laws. 
 
 This bill provides for the acceptance by the companies of the pro- 
 visions of the bill, and that on failure to accept them they shall be re- 
 quired to pay 35 per cent, of their net earnings to the Government; 
 and also provides in that event for a further and better investment of 
 the moneys in the sinking fund. 
 
 These two plans are now before the House. The railroads which 
 have been subsidized by the Government with bonds as well as lands 
 are as follows : 
 
 The Union Pacific, running from Omaha to Ogden Station, a distance 
 of 1039 miles. 
 
 The Central Pacific, which connects with the Union Pacific at Ogden 
 Station, and runs from there to Sacramento City, a distance of 860 
 miles. 
 
 The Kansas and Pacific, running from Kansas City westerly to 
 Gopher Station, in Kansas, 394 miles. 
 
 The Central Branch of the Union Pacific, running from Atchison to 
 Waterville, Kans., 100 miles. 
 
 And the Sioux City and Pacific, running from Sioux City, Mo., to 
 Fremont, Nebr., a distance of 101 miles. 
 
 The amount advanced to all these roads in the aggregate was $64, - 
 000, 000, and neither it nor the interest matures until 1898. Large pay- 
 ments have been and are constantly being made upon this indebted- 
 ness, and while the amount now estimated to be owing is about $100,- 
 000,000, it is estimated that at the maturity of the bonds the amount 
 owing will not be more than $75,000,000. 
 
 Three important questions now present themselves for the considera- 
 tion of the House: 
 
 First. Will we adopt and pass the bill presented on behalf of the 
 committee ? 
 
 Second. Will we adopt and pass the substitute offered by Mr. Post ? 
 or, 
 
 Third. Will we leave the railroads as they now are, to pay what is 
 required of them by law and under the operation and security afforded 
 by the sinking fund created by the Thurman act? 
 
 I will speak on these points in their order. 
 
 The first principal provision of the bill reported* by the Committee 
 provides that the Government shall collect 35 instead of 25 per cent, of 
 
11 
 
 the net earnings of the roads; in other words, changes the Thurman 
 bill to that extent. 
 
 Under the present or existing laws, from all the bond-subsidized 
 roads, the amount annually received is $2,977,096.96. 
 
 Under the bill reported by the committee the amount received would 
 be $4,502,295.62, making a little more than one million and a half, in 
 addition to what the companies are now paying. And under the bill 
 as amended the amount required would be nearly six millions of dol- 
 lars. This is claimed to be the great merit of this bill, and the chief 
 ground upon which it is urged ; and certain figures are set forth for the 
 purpose of showing that these companies are able to pay these extraor- 
 dinary amounts of money. In our judgment this feature of this bill is 
 one of the greatest and strongest objections to it. As we regard the 
 matter, we consider that it is much more important that the people 
 shall have cheap transportation over the whole system of the Pacific 
 roads, and through them over all other roads, than that the Govern- 
 ment should coerce the speedy payment of its debt. I regard cheap 
 transportation over the Pacific roads, and over all other roads, as being 
 the most important matter which can engage the consideration of Con- 
 gress; and that every act in opposition to this idea should be regarded 
 with hostility by Congress. 
 
 The report of the Union Pacific Railroad to its stockholders shows 
 that for the year ending December 31, 1883, the aggregate amount of 
 its passenger and freight traffic was considerably greater than the pre- 
 vious year. While it carried 21 per cent, more of passengers and 23 
 per cent, more of freight, its receipts were $1,821,342.46 less than the 
 year before. Although we have not the official results before us, we 
 are informed that the same result has occurred upon the Central Pacific 
 and the other roads. This was occasioned solely by a reduction of 
 charges in freight and passengers. We regard it as of the utmost possi- 
 ble importance that everything should be done to encourage this re- 
 duction and cheapening of transportation, and that nothing should be 
 done looking in the opposite direction. The public who travel over 
 these roads, and who transport their property upon them, are entitled 
 to the most liberal consideration at our hands. 
 
 The bill of the committee is in direct conflict with the interest of 
 every man, woman, and child carried over these roads, or who uses 
 them as carriers of freight. Let me ask who is it who will be com- 
 pelled annually to pay this additional million and a half of dollars (or 
 $3,000,000 if the bill is amended as' asked) which this bill proposes to 
 add to the amount paid by these companies? Where do the compa- 
 nies get the money with which they pay and are to pay the large 
 amounts required of them by the Government ? Is it not a charge or 
 exaction upon the public — upon the people — upon those who use the 
 road? Every dollar in excess of what these companies are now re- 
 quired to pay to the Government will be raised by an increase of the 
 price of passenger and freight charges on these roads. Railroad com- 
 panies are not eleemosynary institutions. Certainly nobody on this 
 floor has applied any names of that kind to them. They carry on busi- 
 ness upon the same principle as natural persons, for the purpose of 
 making money. If they must pay more they will charge more. The 
 ratio of payment will be the ratio of collection, and hence the ratio of 
 charges. 
 
 Mr. CASSIDY. Right in connection with that statement, if the 
 gentleman will permit me, I will say that I have the report of the 
 
12 
 
 Government experts sent to Boston to examine the books of the com- 
 pany; and that report shows a falling off in the net earnings of the 
 company, for the first five months of the present year, of $1,983,000 in 
 round numbers. 
 
 Mr. BLOUNT. What was the amount of the last dividend? 
 
 Mr. GASSIDY. The last dividend they ever paid they had to bor- 
 row the money to pay it. 
 
 Mr. JORDAN. One of the roads I think pays 6 per cent, and the 
 other 7 per cent. 
 
 Mr. BLOUNT. I mean the last dividend. 
 
 Mr. CASSIDY. One and three-quarters per cent. ; they pay every 
 three months. 
 
 Mr. JORDAN. Here is a reduction in the amount of the receipts 
 of that road of nearly $2,000,000, and yet they have transacted nearly 
 25 per cent, more business than before. I am in favor of that sort of 
 legislation which will permit these roads to keep on reducing their rates 
 of freights in order that the people may have the benefit of that reduc- 
 tion in cheap transportation. 
 
 Mr. LAIRD. Will my friend permit me to ask him a question? 
 
 Mr. JORDAN. With great pleasure. 
 
 Mr. LAIRD. Can you show the House where the Union Pacific Rail- 
 road has ever reduced its charges for carrying freights and passengers 
 a solitary penny ? If so, I would like to have you do it. 
 
 Mr. JORDAN. I would refer my friend to the report of the Rail- 
 road Commissioner on that subject. He will find there that there has 
 been a very large reduction both in 1882 and 1883. 
 
 Mr. LAIRD. I know there was a reduction in Colorado, where they 
 had been charging 10 cents a mile for passengers, to 5 cents a mile, and 
 there has been some reduction for passengers in Nebraska; but I know 
 of no reduction in freight charges. 
 
 Mr. JORDAN. I think my friend has not thoroughly and fully in- 
 vestigated the report. He will find on examination that I am entirely 
 correct. 
 
 Mr. PAYSON. Will the gentleman permit an inquiry? 
 
 Mr. JORDAN. Always. 
 
 Mr. PAYSON. How would it injure the general public if those gen- 
 tlemen controlling these railway corporations should accept smaller 
 dividends than they have been getting for the last eight years ? 
 
 Mr. JORDAN. That will depend upon two propositions: In the 
 first place, whether the dividends they have been getting are unreason- 
 able dividends; and second, whether these roads are now in a condition 
 in fact to pay dividends upon their earnings, or whether they are paying 
 them by exhausting their reserve. 
 
 Mr. PAYSON. As a member of the committee, will the gentleman 
 give the House his judgment as to whether the dividends these com- 
 panies have been exacting from the people have not been extortionate 
 ever since they first commenced paying them. 
 
 Mr. JORDAN. That will be part of £he argument I will undertake 
 to make before I close. The question is readily answered. The gentle- 
 man will find that I have considered all these matters very fully. 
 
 Mr. PAYSON. Will the gentleman allow one further inquiry? 
 When he comes to descant on the dividends these companies have been 
 paying, will he bear in mind the fact that none of these roads cost the 
 present companies a single dollar ? 
 
 Mr. JORDAN. Now, I would like to make a remark on that point 
 
13 
 
 to the House. What difference does it make, so far as regards the ques- 
 tion upon which we are now passing, whether the owners of these roads 
 have paid a dollar toward their construction? The Government of the 
 United States did not give these companies these bonds; it loaned them 
 bonds, did it not ? The bonds were theirs to do with as they pleased. 
 
 Mr. PAYSON. It did. 
 
 Mr. JORDAN. And it is exacting payment of the bonds. 
 
 Mr. PAYSON. It is trying to do so. 
 
 Mr. JORDAN. What difference, then, does it make what the owners 
 of the roads did toward the construction of the roads ? The only ques- 
 tion that can arise is whether the dividends which are being paid are 
 upon a fair capital stock of the roads, and I will undertake to show 
 that they are. 
 
 I am glad to see gentlemen interested in this question, and if they 
 will follow me in what I say, or if they will investigate these matters 
 as I have done for months as a member of the committee, they will come 
 to the same conclusion that I do. 
 
 I resume my argument where I left off at the time I was interrupted. 
 
 Mr. Speaker, it would nob be a difficult task in this House to 
 show that tariffs, internal-revenue taxes are collected from the con- 
 sumer; and passenger and freight charges are simply taxes levied by 
 corporations upon individuals who travel and upon property which is 
 transported. 
 
 This being so, we consider that this bill of the committee will result 
 necessarily in an increase instead of a decrease of passenger and freight 
 transportation over these roads, and that the public will pay, both in 
 the cost of transportation and in the increased price of goods, all that 
 is demanded by this bill in excess of what is paid now. 
 
 This argument ought to be sufficient to induce the House to reject a 
 proposition which makes the people who use these roads pay an addi- 
 tional tribute of $1,500,000 a year, or $3, 000, 000 more, as now asked by 
 the amendment. 
 
 There is another reason why we can not adopt the bill of the com- 
 mittee, and which seems to me a very strong one; and that is, a convic- 
 tion that it is necessary to the successful management of the business 
 of these roads that they should be allowed to use a considerable portion 
 of their profits in constructing feeders and branch roads and in main- 
 taining the best possible equipment for their roads. This has been the 
 policy of these roads, in common with all the other great railroads of 
 the country, and is a necessity forced upon them by powerful rivals 
 who compete with them for every passenger and pound of freight carried 
 over their lines. This policy has been beneficial to the companies, and 
 has enabled them to maintain their main trunk lines in which the Gov- 
 ernment is interested, and to pay to it the amount required by the Thur- 
 man act, and to make their business successful and profitable. Upon 
 this subject the Government directors of the Union Pacific Railroad 
 say: 
 
 The road-bed, track, buildings, and equipment are all in excellent condition 
 and kept well up to the highest standard of the best roads of the country. The 
 feeding lines are bringing each year additional traffic to the main line and in- 
 creasing profits from their own business, to the permanent advantage of the 
 whole system. 
 
 I regard it as greatly in the interest of the public that these roads 
 should be well built, maintained, and equipped, and that they should 
 have the means and be left free to compete with their rivals by making 
 
14 
 
 cheaper rates to the people in the future, and any other policy is short- 
 sighted and unwise; and while it may cater to some local prejudice or 
 feeling, it will, as a result, do great injury to the general business in- 
 terests of the people; not simply those who use the road for local traffic, 
 but that great body of the people who are carried over it, and who use 
 it for more important and general purposes. 
 
 They should be allowed to use a considerable portion of their profits 
 in constructing feeders and branch roads and in maintaining the best 
 possible equipment for their roads. This has been the policy of all these 
 roads. It is demanded by the necessities of business and travel over 
 them ; it is demanded in the interest of the public convenience. It 
 is a necessity forced upon them by powerful rivals, who compete with 
 them for every passenger and every pound of freight carried over these 
 lines. 
 
 Look at the Union Pacific Railroad. You will find it paralleled 
 from one end to the other by two great roads — the Quincy and Bur- 
 lington Railroad upon the one side, and the Atchison and Santa F6 
 upon the other. The case is said to be the same in regard to the Cen- 
 tral Pacific Railroad. It is said that all these roads are either paral- 
 leled by other great roads, or are compelled to compete with other and 
 rival roads for all the business they transact. 
 
 Mr. GLASCOCK. Will the gentleman state what line there is par- 
 allel to and competing with the Central Pacific Railroad? There is 
 no line competing with the Central Pacific road, and it absolutely holds 
 a monopoly of all the California business. 
 
 Mr. CASSIDY. I hope the gentleman from Ohio will allow me to 
 answer the gentleman from California. 
 
 Mr. JORDAN. I yield to the gentleman from Nevada, the chairman 
 of our committee, for that purpose. 
 
 Mr. CASSIDY. The gentleman from Ohio, when he speaks of these 
 roads being parallel, or in competition with other roads, means, as I 
 understand him, that the Central Pacific does not control all the busi- 
 ness in that section of the country, that there is a diversion of business 
 from it, and consequently a reduction of the earnings of these subsidized 
 roads. And now taking his statement in the sense in which he means 
 it, I undertake to maintain that the completion, for instance of the 
 Northern Pacific road, has diverted from the Union Pacific all the Mon- 
 tana freight, all the Washington Territory freight, and in a great measure 
 the Oregon freight. I maintain, also, that the completion of the South- 
 ern Pacific has diverted a large share of the business from the Central 
 Pacific. 
 
 Mr. GLASCOCK. Is not the Southern Pacific practically under the 
 same control ? 
 
 Mr. ANDERSON. Are not all these roads pooled ? 
 
 Mr. CASSIDY. I am not speaking of competition as reducing rates, 
 but in regard to its effect in reducing business. 
 
 Mr. JORDAN. Resuming where I left off, I desire to repeat that the 
 policy of allowing these roads to construct or aid in the construction of 
 branches and feeders has been beneficial to the companies and has en- 
 abled them to maintain the great trunk lines in which the Government 
 is interested and to pay the amount required by their contract with the 
 Government, the amount fixed by the Thurman act, and to make their 
 business successful and profitable. 
 
 Another grave objection to this bill of the committee is that it will 
 prevent them from paying dividends to their stockholders. When the 
 
15 
 
 Thurman hill was passed it was never contemplated for a moment that 
 the roads should not pay a dividend to their stockholders; on the con- 
 trary, it was intended they should pay a dividend. It may be well here 
 for me to quote from the remarks of Senator Thurman, the distinguished 
 author and champion of the sinking-fund bill in the Senate. 
 
 On this subject Senator Thurman said: 
 
 If the committee had not recognized the fact that it is for the interest not only 
 of the companies, but of the country and the public, that the stockholders 
 should be allowed to receive some reasonable dividends, because where roads 
 pay dividends they are always better managed than where they pay none ; if 
 it had not been for those considerations we might justly have acquired more 
 onerous conditions than those that we have imposed by this bill. Am I right 
 about that? It is shown by the report of your committee, by going over the re- 
 ceipts and expenditures of these companies for long periods, that they can com- 
 ply with this bill and pay every dollar of interest annually upon their indebt- 
 edness, both that whose lien is inferior to that of the United States as well as 
 the first mortgage whose lien is superior ; that they can pay every»dollar inter- 
 est upon their entire funded debt, pay all their operating expenses, pay to the 
 Government what by existing law they are required to pay, and pay into a 
 sinking fund what this bill requires them to pay, and then have annually for 
 distribution among their shareholders as follows : The Union Pacific about 4 
 per cent, on the nominal value of the stock, or 6£ percent, on its present market 
 value, and the Central Pacific about 6.4 per cent, on the nominal value of the 
 stock. 
 
 One of the effects of this bill of the committee will be to prevent the 
 payments of dividends to the stockholders. This is all wrong. The 
 stock of these roads has been regarded by our people as a good invest- 
 ment. It is held and owned in all parts of the country. More than 
 5,000 persons are stockholders in the Union Pacific alone. The securi- 
 ties of these roads, including the stock, “ have become favorites in the 
 market for investments, and they are widely scattered at home and 
 abroad. They have taken to a certain extent the place of the public 
 funds as investments.” Stop the payment on these stocks, and you 
 ruin thousands of innocent people. 
 
 Two of these roads — the Sioux City and the Central Branch of the 
 Union Pacific — are not only put uncl^er the operation of the Thurman 
 act by this bill of Mr. Thompson, but are required to pay 35 per cent, 
 of their net earnings to the Government, when as a matter of fact they 
 have never paid a dollar by way of dividend on their stock ; and the 
 latter road is in a state of hopeless insolvency. 
 
 Mr. THOMPSON. I will call the gentleman’s attention to the fact 
 that the Sioux City and Pacific Railroad paid as dividends on its cap- 
 ital stock the sum of $11,930, or more than 10 per cent. 
 
 Mr. JORDAN. I do not so understand the fact. That road has been 
 in a chronic state of insolvency ever since its creation. If the com- 
 pany did pay the amount stated, $11,930, instead of being 10 per cent, 
 on its capital stock, it would only be about 1 per cent, on its stock, 
 which amounted to $1,000,000. And now let me ask the gentleman 
 a question. Did this company, in the twenty years of its existence, 
 ever pay any other dividend ? 
 
 Mr. THOMPSON. I have not examined the full list of dividends. 
 But I will state that last year it increased its net earnings over 200 per 
 cent. 
 
 Mr. JORDAN. The gentleman is again mistaken. He is referring 
 to the Central Branch of the Union Pacific, not to the Sioux City and 
 Pacific Railroad, which only increased its earnings 28 per cent. 
 
 At the time I was interrupted I was considering the question of these 
 roads being allowed to pay dividends to stockholders, and I have simply 
 to add in addition upon that point that this view of the matter was 
 
16 
 
 taken by Senator Thurman in a discussion of his bill, that no Senator 
 who took part in that discussion on either side ever suggested any 
 other course. 
 
 Indeed, Mr. Speaker, will any man in his senses, any lawyer, sup- 
 pose for a moment that a bill depriving the stockholders of all divi- 
 dends would have been regarded by the Supreme Court as constitutional ? 
 They had already decided that the debt owing to the United States was 
 not due until 1898, that the Government had no right until then to 
 require payment, and it would have been more than unreasonable to 
 require these companies to lay aside for the future so much of their 
 earnings as disabled them from paying a dividend to their stockholders. 
 
 The stockholders of a railroad company are its owners, and to have 
 deprived them of the whole of their dividends would have been an act 
 so arbitrary in its character and so unreasonable that the Supreme Court 
 would never have decided it to have been within the limitations of the 
 constitutional power of Congress. If this policy had been pursued does 
 any man suppose for a moment that this company would not have ceased 
 business at once, and been compelled to abandon its property to the Gov- 
 ernment ? And we would have found ourselves ip the position of hav- 
 ing the United States taking one more step in the direction of centrali- 
 zation, and found it engaged in carrying on the business of a railroad. 
 
 Mr. ANDERSON. Will the gentleman allow me to ask him a ques- 
 tion ? 
 
 Mr. JORDAN. I hope my friend from Kansas will not think me dis- 
 courteous in declining to yield further. I have already been too gener- 
 ous in yielding my time for interruptions. 
 
 And now, Mr. Speaker, proceeding further in my objections to the 
 bill of the committee I find another important argument against this 
 bill is that it puts in jeopardy ail the money now in the sinking fund 
 under the Thurman bill, now amounting to about $5,000,000, and will 
 result probably in having that law declared unconstitutional. There 
 has been paid in already under that bill many millions of dollars which 
 will be lost to the Government if' that law should be declared uncon- 
 stitutional. This law was declared constitutional, as has been stated, 
 by a divided court. And whoever will take the trouble of examining 
 the dissenting opinions of Justices Field, Bradley, and Strong will con- 
 sider their argument against the constitutionality of the act of May 7, 
 1878, as entitled to the gravest consideration. In the mutation of hu- 
 man affairs but five of the justices who took part in the decision of that 
 case are now on the supreme bench, and of these five only three believed 
 the law to be constitutional. 
 
 This bill of the committee, by changing the amount to be paid in 
 under the Thurman law and extending its operation, gives these com- 
 panies an opportunity, if it does not invite them, to again test the con- 
 stitutionality of this sinking-fund law. Is it good policy or wise states- 
 manship to do this? I have the highest possible regard forjudge 
 Thurman, and this bill will long stand as a monument of his ability 
 and skill as a lawyer and a statesman. At the same time I have the 
 most serious doubts as to its constitutionality. Is it not better to stand 
 where we are and take no chances in this matter? Let us be contented 
 with what we have, and not, like the dog in the fable, lose the substance 
 while grasping at the shadow. 
 
 Mr. JONES, of Wisconsin. Does not the railroad company have 
 every year the right to test the constitutionality of that law, and will 
 it not have that right whether we pass this bill or not ? 
 
17 
 
 Mr. JORDAN. I think it has the right to do it now, but these com- 
 panies have not been disposed to do it, because they are willing to pay 
 the amount required under these various acts. But if you undertake 
 to say that these railroads shall pay annually a million and a half of 
 dollars more than they are now paying (and indeed it would be more 
 than three millions under the amendments made to the bill), then you 
 will have so burdened them beyond their ability to bear that they will 
 be compelled to find relief from your oppressive exactions either by 
 appealing to the justice of the courts or by abandoning their business or 
 surrendering their property. In my judgment, Mr. Speaker, this bill 
 of the committee puts in jeopardy all the money now in the sinking 
 fund and risks all that has been expected from it. In my opinion it 
 is an unwise measure, and I desire on behalf of the Government and the 
 public, whose servants we are, to put on record my protest against it. 
 
 I now come to the consideration of the fifth section of the bill of the 
 committee, which is as follows: 
 
 Sec. 5. That the Central Pacific Railroad Company pay into said sinking fund 
 the sum of 85,000,000; that the Union Pacific Railroad Company pay into said 
 sinking fund the sum of $5,000,000; that the Kansas Pacific Railroad Company 
 pay into said fund $2,000,000; that the Sioux City and Pacific Railroad Company 
 pay into said fund $500,000; that the Central Branch of the Union Pacific Rail- 
 road Company pay into said fund $500,000, all of which said payments shall be 
 made by said companies on or before Janury 1, 1885 : Provided, however , That all 
 sums of money, if any, which are claimed by said corporations, or any of them, 
 as due them for services rendered the Government in transportation of mails, 
 passengers, freight, or otherwise, as follows, namely : First, one-half compen- 
 sation earned on bond-subsidized roads from January 1, 1873, to June 30, 1878; 
 second, total compensation earned on non-bond-subsidized roads owned, leased, 
 controlled, operated, or managed by subsidized companies from January 1, 1873, 
 to this date; third, one-half compensation earned from July 1, 1878, to this date 
 on bond-subsidized roads not embraced in the act of May 7, 1878, and which 
 said sums so claimed have been withheld by the Government and applied, in 
 whole or in part, to the payment of interest on the said subsidy bonds or to the 
 purposes of the sinking fund, shall be credited upon said cash payments di- 
 rected to be paid as aforesaid to the extent of the interest of each of said com- 
 panies respectively in said claims; and upon all of said sums claimed to be due 
 upon the accounts aforesaid and so withheld, and which have been applied to 
 the payment of interest, there shall be interest allowed said corporations at the 
 rate of 3 per cent, per annum from the said date of application until covered 
 into the sinking fund under the operations of this act; and upon such portion 
 as went into the sinking fund credit shall be given as of date it was passed to 
 said fund, with interest at the rate produced by the investments then made ; 
 and if said credits when so allowed fall short of the cash payments herein re- 
 quired, the Secretary of the Treasury shall suspend the collection of the residue 
 until further directed by Congress. 
 
 The accounts between the Government and the said corporations shall be re- 
 stated to conform to the requirements of this act, and the unpaid interest ac- 
 count increased in proportion to the sums transferred from it to the sinking 
 fund. 
 
 I read so much of the report of the committee as bears upon this 
 section. It is as follows: 
 
 The accounts between the Government and the railroads are in a very unsat- 
 isfactory and uncertain condition. The complications arise principally out of 
 the act of March 3, 1873, which has since been carried into the Revised Statutes 
 as section 5260. The companies claim that this act was an attempted modifica- 
 tion, without their consent, of what they claim was a charter-contract made in 
 the act of 1864 ; that by said act Congress retained only the right to withhold 
 and apply one-half the compensation earned upon the bond-subsidized portion 
 of the roads by services to the Government ; therefore, they say, the officers 
 having retained all not only on the bond-aided portion but also on the non-bond- 
 aided road owned by them (and upon roads not embraced by the Thurman act 
 since it took effect), they have a right to recover the same back with interest. 
 
 JO 2 
 
18 
 
 These claims, as stated, are about as follows : 
 
 1. One-half compensation earned on bond-subsidized roads from 
 
 January 1, 1873, to June 30, 1878 $1, 753, 554 79 
 
 2. Total compensation earned on non-bond-subsidized roads 
 
 owned, leased, or operated by subsidized companies from Jan- 
 uary 1, 1873, to June 30, 1882 1, 418, 110 84 
 
 3. One-half compensation earned from July 1, 1878, to June 30, 1883, 
 
 on bond-subsidized roads not covered by the act of May 7, 1878, 
 or Thurman sinking-fund act 221,572 01 
 
 Total 3,393,207 64 
 
 This is for mail transportation alone, and the data furnished does not run down 
 to date, nor has it been practicable to obtain sufficient information to give even 
 an approximate estimate as to the amount of compensation earned by the bond- 
 subsidized roads for services other than mail transportation of the three several 
 classes above set forth and for the separate periods mentioned. It is thought it 
 will equal, if it does not exceed, the amount above allowed for mail transporta- 
 tion. 
 
 These claims, if allowed with interest, will be over $10,000,000, and require 
 large deficiency appropriations to pay the same. Shall they be paid, or in some 
 way covered into the sinking fund? 
 
 It has been held by the Court of Claims that the Government could not retain, 
 for the purpose of paying interest, any portion of the compensation due on the 
 non-subsidized portions of said roads, or on roads controlled, leased, or operated 
 by the subsidized companies ; further, that it could only retain one-half the 
 compensation for that purpose on the subsidized portions of said roads. This 
 practically declares the act of March 3, 1873, inoperative, and leaves the Govern- 
 ment to pay the claims above set forth, unless they can be covered into a sink- 
 ing fund. (16 Court of Claims, 360.) It must be noted, however, that the sink- 
 ing-fund act was not under consideration in the decision referred to above. 
 
 It will be seen that this section relates to three distinct classes of 
 claims which it is sought by the arbitrary act of Congress, by a sort of 
 legislative sequestration, to take from these roads and turn into a sink- 
 ing fund. 
 
 I deny the authority of Congress to pass this act, and submit the 
 question to the candid consideration of every lawyer and every fair- 
 minded man in the House. 
 
 It is admitted in the report of the committee, and it was decided by 
 the Supreme Court, that Congress could not take any of the money or 
 current earnings of these roads and appropriate them to the payment 
 of the debt; but it is said that, while we can not do this, we can order 
 these companies to pay a sum larger than these amounts into the sinking 
 fund, allow them interest upon it (and thus kick the devil around the 
 stump), and thus prevent the companies getting the money they are 
 entitled to. 
 
 Now let us see what was decided in the Sinking-fund case. 
 
 The court decided in that case simply that Congress had a right to 
 require the companies which had been subsidized by the Government 
 with bonds and lands to lay aside so much of their current earnings, 
 after paying a dividend to their stockholders, as would be necessary to 
 protect the Government or other creditors, and that a sinking fund 
 could be established in the Treasury of the United States for that pur- 
 pose. That decision related wholly to the future earnings of the road, 
 and did not operate on any moneys already earned. The fifth section 
 of this bill, however, takes from these companies money already earned 
 and owing to it by the Government, is retroactive in its character, de- 
 prives them without due process of law of rights already vested, and is 
 therefore unconstitutional. 
 
 In the Sinking-fund case, decided by the Supreme Court of the United 
 States, in 9 Otto, page 718, Chief- Justice Waite, in announcing the opin- 
 ion of the majority of the court, recognized fully the position that I 
 
19 
 
 contend for, namely, that Congress had no power to pass any law set- 
 ting aside the past earnings of any of the subsidized roads and placing 
 them in a sinking fund. On page 719 the learned judge said: 
 
 The precise point to be determined now is whether a statute which requires 
 these companies in the management of their affairs to set aside a portion of their 
 current income as a sinking fund to meet this and other mortgage debts when 
 they mature deprives these companies of their property without due process of 
 law, or in any other way improperly interferes with vested rights. 
 
 This shows that the decision did not relate to past earnings, but only 
 to future income or earnings of the road. There was nothing retroactive 
 about it. 
 
 On page 720 the learned judge was £till more explicit on this point. 
 The language used is: ♦ 
 
 All agree that the power of Congress can not be used to take away property 
 already acquired under the operation of their charters, or to deprive the corpo- 
 rations of the fruits actually reduced to possession of contracts lawfully made. 
 
 On page 721 the court seemed determined to leave nothing in doubt 
 as to its meaning on this point, and said: 
 
 It [Congress] can not undo what has already been done and it can not unmake 
 contracts that already have been made, but it may provide for what shall be 
 done in the future. 
 
 Again, on the same page, the court says: 
 
 All such legislation will be confined in its operation to the future. 
 
 Mr. HOLMAN. But there is a power of alteration or amendment in 
 the act. 
 
 Mr. JORDAN. My distinguished friend from Indiana suggests that 
 there is a power reserved to the Government in the charter of these com- 
 panies by which Congress may alter or amend the acts creating them. 
 But, sir, it was upon that direct proposition that the court ruled, and 
 I was reading from that very portion of the decision in support of my 
 position, and I now call the attention of the gentleman and the House 
 to this part of the decision again, and I will read a little more fully 
 than I did before, in order that the House may see the full force of my 
 position and what the court said on the subject: 
 
 Taking both acts together, and giving the explanatory statement in that of 
 1862 all the effect it can be entitled to, we are of the opinion that Congress not 
 only retains but has given special notice of its intention to retain full and com- 
 plete power to make such alterations and amendments of the charter as come 
 within the just scope of legislative power. That this power has a limit no one 
 can doubt. All agree that it can not be used to take away property already ac- 
 quired under the operation of the charter or to deprive the corporation of the 
 fruits actually reduced to possession by contracts lawfully made. 
 
 The latter part, the gentleman will perceive, is what I read before. 
 
 And while I am upon the subject of the power of Congress to alter 
 or amend the acts of July 1, 1862, and July 1, 1864, let me conclude all 
 that I have to say upon that subject. These acts created one corpora- 
 tion, the Union Pacific, and recognized certain other corporations created 
 by the State. These grants were not mere gifts or donations, but were 
 made to these companies in consideration of certain acts to be done by 
 them. The Government by these acts granted to these companies their 
 right of way, a large amount of lands, and agreed to loan its bonds or 
 credit. In consideration thereof the companies agreed to construct 
 the roads and telegraph lines provided for in the act and keep the same 
 in repair and use, to pay the bonds loaned at maturity, to transmit dis- 
 patches over the telegraph lines, and transport troops and munitions of 
 war, supplies and public stores upon said railroads for the Government 
 when required at certain rates, and give the Government a preference 
 
20 
 
 in so doing, and apply one-half compensation and 5 per cent, interest 
 on bonds until paid. And it was provided in said acts that the com- 
 panies named therein should ‘ ‘ file their assent thereto under their seals 
 in the Department of the Interior within one year;” and these accept- 
 ances were filed. 
 
 Now, until that was done no right passed from the Government or to 
 these companies; when that was done a contract existed between the 
 Government and these companies obligatory upon both, and from which 
 neither of them could withdraw. 
 
 It must be evident to any one, who will consider the matter for a mo- 
 ment, that the United States in the enactment of these laws and mak- 
 ihg the contracts above mentioned acted in two distinct capacities. 
 In creating the corporation and granting a franchise to it and to other 
 corporations we see an act of political sovereignty, but in all other par- 
 ticulars we simply see the Government making contracts as a civil cor- 
 poration. Under the power to alter and amend Congress unquestion- 
 ably reserved certain rights in relation to these companies and to their 
 franchises; but it could in the nature of things reserve no power what- 
 ever to alter, amend, or repeal any part of these acts which by the ac- 
 ceptance of the company constituted a contract. It seems to me that 
 to take any other view of this matter would leave these corporations, 
 after they had accepted the terms proposed by the Government, and 
 after they had entered upon the execution of their contract and built 
 their roads, entirely at the mercy of Congress. 
 
 Touching the authority of Congress as to its power to alter and amend 
 such contracts, and claiming that in so doing it can not take away or 
 destroy rights which have already vested, I desire to call the attention 
 of the House tonvhat has been said upon this subject by statesmen and 
 courts. 
 
 Mr. Madison said, in the forty-fourth number of the Federalist — 
 
 That laws impairing the obligations of contracts are contrary to the first prin- 
 ciples of the social compact, and to every principle of sound legislation. 
 
 In the case of Fletcher v. Peck, reported in 6 Cranch, page 103, the 
 court said, in substance: That legislative grants in the nature of a con- 
 tract and under which rights have vested are not held durante bene 
 placito of the law-making power. 
 
 In 15 Monroe, Kentucky Law and Equity Reports, page 320, it was 
 said by an eminent judge that — 
 
 A reservation by the Legislature in a charter of power to alter, amend, or re- 
 peal does not imply the power to alter or change the vested rights acquired by 
 the corporation under the charter. 
 
 In the case of the Commonwealth v. Essex Company, in 13 Gray Re- 
 ports, Chief-Justice Shaw, in speaking of the power reserved in the 
 words to alter, amend, or repeal, said: 
 
 Where under a power in a charter rights have been acquired and become 
 vested, no amendment or alteration of the charter can take away the property 
 or rights which have become vested under a legitimate exercise of the power 
 granted. 
 
 In the case of Calder v. Buell (3 Dallas, page 388) it was said by the 
 court: 
 
 The Legislature may command what is right and prohibit what is wrong, but 
 they can not change innocence into guilt, or violate the rights of an antecedent 
 private lawful contract, or the rights of private property. 
 
 And Justice Swayne, in the case of Shields v. Ohio, in 95 U. S. S. 
 C. Reports, said: 
 
 Such alterations must be reasonable ; they must be made in good faith, and 
 
21 
 
 must be consistent with the object and scope of the act of incorporation. Sheer 
 oppression and wrong can not be inflicted under the guise of amendment and 
 alteration. 
 
 Where, then, Mr. Speaker, is the power of the Congress of the United 
 States to take away from these companies their vested right in the 
 moneys already earned by them? Would any man have the hardihood 
 to claim upon this floor that Congress could take the lands of these 
 companies for the purposes of a sinking fund ? If these companies had 
 United States bonds, stocks, moneys, would anybody assert that Con- 
 gress could take these and put them into a sinking fund ? If, indeed, 
 these companies were the owners of bills receivable and other choses in 
 action, would it be said that Congress could seize on these, deprive the 
 companies of them, and put them into a sinking fund ? And what, Mr. 
 Speaker, is a claim against the Government owing to these companies 
 and withheld from them but a chose in action ? 
 
 How pertinent at this point is the language of Judge Strong, to be 
 found on page 738 in 99 U. S. S. C. Reports. He said: 
 
 What is property ? A right in action is as completely property as a title to 
 land. A very large part of the property of the country consists in rights^ttend- 
 ant upon contracts. The right of a promisee to demand payment when a note 
 falls due is a right of property. 
 
 And so a claim owing by the United States to these railroad compa- 
 nies is a vested right, that can not be taken from them by retroactive 
 legislation, or in any other way except by due process of law, and that 
 has been defined to be “ by law in regular course of administration 
 through regular courts of justice.” 
 
 Mr. Thurman never thought anything of this kind could be done, nor 
 was it attempted by the act of 1 873. 
 
 In 4 Devereux, North Carolina, page 1, Chief-Justice Ruffin said: 
 
 To do indirectly in the abuse of the exercise of an acknowledged power, not 
 given for but perverted for that purpose, that which is expressly forbidden to 
 be done directly, is a gross and wicked infraction of the Constitution. 
 
 Mr. HEWITT, of Alabama. Will the gentleman permit me to ask 
 him a question ? 
 
 Mr. JORDAN. Yes, sir. 
 
 Mr. HEWITT, of Alabama. Are any of these roads now indebted to 
 the sinking fund; and, if so, in what amount? 
 
 Mr. JORDAN. Four of them are not. The Union Pacific is indebted, 
 but it claims $4,000,000 to be due to it from the Government by way 
 of compensation for transportation. If this is adjusted there is not one 
 of them that owes the sinking fund a dollar. But, Mr. Speaker, the 
 next provision of this section is, if anything, more monstrous and ille- 
 gal than the one I have just considered. 
 
 It proposes to take from these companies and carry into the sinking 
 fund the whole compensation earned on non-subsidized roads, whether 
 owned, leased, controlled, operated, or managed by the subsidized 
 roads, from January 1, 1873, to this date. 
 
 Mr. STRUBLE, of Iowa. The whole of the compensation? 
 
 Mr. JORDAN. No wonder it strikes my friend from Iowa as a 
 strange proposition. Yes, sir; the whole compensation. 
 
 Now, in order that the House may understand the full force of this 
 provision of the bill, let me make a brief statement of the facts: The 
 Union Pacific Railway Company, including the Kansas Pacific, only re- 
 ceived aid from the Government in bonds on 1,436 miles of its road. 
 There is now embraced in the system of that road 4,327 miles. Eighteen 
 
hundred and twenty-nine miles are owned by the company and 2,498 
 miles are merely controlled or operated by the company. 
 
 The Central Pacific Railroad system embraces 3,003 miles. Only 
 eight hundred and sixty miles were subsidized or aided in bonds, and 
 2,177 miles are merely leased or controlled by the Central Pacific. 
 
 Now, while not more than one-third of the Union Pacific and not 
 more than one-fourth of the Central Pacific was subsidized, it is sought 
 to take the earnings of 4,675 miles of road which received no Govern- 
 ment aid. This amounts to an illegal appropriation into the sinking 
 fund of several millions of dollars already earned, and honestly owing 
 by the Government to these companies for transportation services on 
 non-subsidized roads. By the charter or contract the companies agreed 
 to allow the Government to retain one-half compensation on the sub- 
 sidized or aided lines, but it did not agree to allow anything to be re- 
 tained on non-aided lines, and the Government paid on such lines for 
 many years. There was a consideration for a promise to pay the one- 
 half compensation on an aided road, and there might be a pretense of 
 right to require the other half to be paid into a sinking fund, but here 
 there is no promise to pay any part of the compensation upon a line 
 not subsidized, nor is there any consideration for such a promise. 
 
 But it is said that the Government deals with the corporations and 
 not with the roads, and that the companies have promised to pay, and 
 this makes them liable over the whole length of their road, whether 
 they own it, lease it, or operate it — the same exactly as they are upon 
 the subsidized portion of the road. Indeed, if this is so, why do you 
 not apply the same principle that you do over the subsidized roads? 
 Why do you not apply one-half to the payment of the interest on the 
 bonds? Why pay it all into a sinking fund? If this proposition is 
 correct, the companies are entitled to have one-half applied to the pay- 
 ment of interest, and you have no right to prevent it; and you could 
 only carry the other half into the sinking fund. 
 
 The advocates of this bill must take one horn of the dilemma or the 
 other. The Government either had or it did not have the same right 
 to retain one-half of the compensation on non-aided as on aided lines. 
 If it did have, then this provision of the bill is wrong, as it changes 
 the application of this money by putting the whole into a sinking fund 
 when it was bound to apply one-half to the payment of interest. If 
 it did not have this right, then the Government should have paid this 
 money to the companies. 
 
 Mr. Speaker, the author of this bill knew perfectly well that the 
 Government had no claim upon the money earned upon these non-aided 
 lines, and that it ought to have paid it over; and hence he seeks by 
 this bill to have the whole of it carried into a sinking fund, and not one- 
 half, as in case of the compensation on the portions of the road subsi- 
 dized with bonds. But, Mr. Speaker, we need not reason or speculate 
 upon this subject. It has been already passed upon and settled by the 
 courts. 
 
 The first case which I cite is that of The United States v. The Denver 
 and Pacific Railway Company, reported in 9 Otto, page 461. The sylla- 
 bus of the case is as follows: 
 
 The Denver Pacific Railway and Telegraph Company is not liable for the debt 
 incurred by the Kansas Pacific Railway Company on account of subsidy bonds ; 
 and although it is bound to perform the Government service stipulated by the 
 Pacific Railroad acts at the rates therein prescribed, and is subject to their provis- 
 ions so far as they are applicable to it, no part of the compensation due it for 
 such service can be retained by the United States. 
 
23 
 
 Now let me read the note at the end of the decision: 
 
 At a subsequent day of the term Mr. Justice Bradley remarked : “ Since deliv- 
 ering the opinion in this case our attention has been called to the fact that, 
 while affirming generally the judgment of the court below, we did not ex- 
 pressly pass upon the question of the right set up by the Government to retain 
 one-half of the amount of compensation due from it to the claimant for the 
 transportation of mails and other public property. This point was not over- 
 looked in rendering our judgment in the case. We can not conceive on what 
 principle the retention can be claimed, since the object of retaining the compen- 
 sation for such services or any portion thereof, as expressed in the sixth section 
 of the act of 1862 , was to apply the amount so retained to the debt due to the 
 Government for subsidy bonds granted to the companies that should receive 
 the same. But the claimants in this case received no such bonds, and we de- 
 cided that neither the company nor its railroad or property is liable in anyway 
 for the payment of any debt incurred for such bonds received by the Kansas 
 Pacific Railway Company. Consequently there is no room for the application 
 of the right of retention in this case, and the judgment of the Court of Claims 
 was properly rendered for the whole amount of such compensation due.” 
 
 In the case of The Union Pacific Railway Company v. The United 
 States, reported in the sixteenth volume, page 353, of the Court of Claims 
 Reports, the court held that compensation should be paid to a subsidized 
 company for services on a part of its road owned but not aided by sub- 
 sidy bonds. And in the same volume of reports, on page 361, will be 
 found the case of The Central Branch of the Union Pacific Railway 
 Company v. United States, in which the same court decided that com- 
 pensation should be paid for services to a subsidized company on a line 
 leased by it. These cases were regarded as so clear by the Attorney- 
 General of the United States that they were not carried to the Su- 
 preme Court. Indeed, the decisions of the Supreme Court of the United 
 States in the case of The United States v. The Kansas Pacific Railway 
 Company, in 9 Otto, page 450, and the case of The United States v. 
 The Denver Pacific Railway Company (above quoted, in the same vol- 
 ume of reports) had so settled the principles of these cases that it was 
 useless to go any further in the matter. 
 
 In addition to all these decisions Hon. William Lawrence, First Comp- 
 troller of the Treasury, in one of the Pacific Railway cases, rendered an 
 able and interesting decision, in which he reviews all the decisions upon 
 the subject and decides the same way. The principle that I contend for 
 ought now to be considered settled, as it has been decided by the First 
 Comptroller of the Treasury, by the Court of Claims, and by the Su- 
 preme Court of the United States. In all these decisions the companies 
 are held to be one thing and the roads another, and no duty or liability 
 is held to accrue under the acts of July 1, 1862, and July 1, 1864, except 
 upon or to the extent that the road was subsidized. Hence it is that the 
 courts have refused to recognize any lien, right, or claim of any kind 
 upon the non-aided lines. It thus appears that the attempt to take the 
 earnings of these companies on the non-subsidized lines, whether owned, 
 leased, operated, or managed, is illegal, and this section of the bill un- 
 constitutional. This act of the Government might well be likened to 
 the case of a mortgagee who holds a second mortgage upon a farm, and 
 long before his debt becomes due files a bill in equity asking the court to 
 appoint a receiver to collect the earnings not merely from the said farm 
 upon which he has a lien, but also asks the court to require the debtor 
 to pay to the receiver any earnings which he should make upon other 
 farms which he should lease or control or manage. If there is any single 
 element in this proposition upon which the court could act, then I can 
 understand what my friend from Kentucky meant when he said that 
 any court would sustain his bill. 
 
24 
 
 Mr. Speaker, every provision of this fifth section of the bill of the 
 committee is retroactive, and without due process of law deprives these 
 companies of rights which have long since vested. They can neither 
 be defended in the forum of law nor conscience. This whole section of 
 this bill is a mere assertion of arbitrary power because the Government 
 has got the money in its possession. It is indeed the clearest abuse of 
 power and done without a shadow of right. It can be justified in no 
 tribunal which proposes to do justice. It is the Government adjudicat- 
 ing in its own favor matters which it is unwilling to trust to the j udicial 
 tribunals of the country. It is an act by which the Government, hav- 
 ing refused to pay what it was bound to pay, having retained by superior 
 force or advantage of position as debtor, now seeks to justify itself. 
 
 It was once said by a distinguished j udge that ‘ ‘a corporation had no soul 
 to be damned nor body to be kicked; ” and if this act is passed it would 
 seem that they had no rights which Congress is bound to respect. 
 
 The next clause of the bill seeks to carry into a sinking fund the 
 amount due from the Government to the Kansas Pacific, Central Branch 
 of the Union Pacific, and the Sioux City and Pacific Railway Com- 
 panies on their roads, whether subsidized or not. The same principles 
 contended for above will apply to them, and I will take no further time 
 on this subject. 
 
 The sixth section of the bill of the committee directs that all the 
 ■compensation which the Government may hereafter owe to these com- 
 panies for transportation over non-subsidized lines if owned, leased, or 
 operated by them shall become and be the sinking fund. The argu- 
 ment above made and authorities above cited apply equally to that sec- 
 tion, and I will not detain the House further on this subject. 
 
 Mr. BLOUNT. Does this proposition interfere with these — with the 
 leases or contracts which these roads have made or with the payment of 
 the amount due under them ? 
 
 Mr. JORDAN. That depends upon the construction which may be 
 given to the bill. I do not want to interpret the bill in that particular. 
 Every member will have to do that for himself. I may say that I re- 
 gard this clause of this bill as a reckless attempt to extend this octopus 
 bill over non-subsidized lines without any reference whatever to their 
 rights. 
 
 AS TO THE POST BILL, OR SUBSTITUTE OF THE MINORITY. 
 
 Mr. Speaker, I have said much more than I intended in this case, 
 and I will therefore be brief upon what I have to say upon this substi- 
 tute. It can well rest upon what has so ably been said by the gentle- 
 man from Pennsylvania [Mr. Post], and what may be said by the gen- 
 tleman from Nevada [Mr. Cassidy], the chairman of the committee. 
 
 It is not claimed that this bill is perfect, and indeed there are several 
 amendments to it which have been under consideration and should be 
 made before it is passed. The bill is before the House, and amend- 
 ments can easily be made to relieve it of any objectionable features. 
 This bill when amended will, in my judgment, be far preferable to that 
 of the committee as presented by Mr. Thompson. 
 
 It is the principle of this bill which we desire to have presented and 
 considered by the House. If you examine it dispassionately and care- 
 fully you will adopt it. If the bill of the committee should become a 
 law, and the amount required by it should be paid by the companies, 
 there would still remain owing to the Government in 1898 $96,000,000. 
 The Government would then be in the same position that it now is, ex- 
 cept as to the amount now owing, and would have to devise some mode 
 
25 
 
 of collecting this debt and making a final settlement with the company. 
 We have thought it best to make this condition of affairs known to the 
 House, and to present a bill looking to such a settlement, and also 
 looking to the ultimate extinguishment of the debt. 
 
 The substitute of Mr. Post provides that the amount of the indebt- 
 edness of the companies, or the present worth of such debt, should be 
 ascertained; that this indebtedness should be divided into sums within 
 the ability of the companies to pay ; that the time for payments should 
 be correspondingly extended; that additional securities should be given 
 for each payment so to be made, and also for the payment of the whole 
 debt. We are satisfied that the principle of this bill will have to be 
 adopted at some time as the basis upon which to settle this matter with 
 these companies. It is not so important to the Government that it shall 
 have its money soon as it is that the debt shal 1 be secured and its pay- 
 ment made certain. It is also important to the Government and the 
 roads that this whole matter shall be taken out of Congress. A distin- 
 guished Senator from Indiana, Senator Vooehees, in the debate at 
 the time of the passage of the Thurman sinking-fund bill, used this lan- 
 guage upon this subject: 
 
 This subject ought to be removed from Congress ; it ought not to be a theme of 
 perpetual agitation in these Halls. The great interests at stake should not be 
 made the playthings of stock speculators, brokers, and gamblers ; nor should 
 they be left open for every adventurous, aspiring, restless member of either 
 branch of Congress to inaugurate a new agitation whenever his interests or his 
 ambition might dictate. 
 
 The force of these remarks lies in the application. 
 
 By this substitute proposed by the minority payments are to be made 
 every six months in certain fixed and definite sums. It is admitted by 
 Mr. Thompson in his advocacy of the bill of the committee that at 
 the maturity of the debt of the Government in 1898 there will still be 
 due and owing by these roads the sum of $96,000,000; and the most 
 remarkable and extraordinary thing is, that in the bill of the commit- 
 tee no provision whatever is made for the settlement or the extinguish- 
 ment of this debt at its maturity. By the plan proposed by the minor- 
 ity in the substitute the amount which will be owing in 1898 will not 
 be much greater than it will on the plan proposed by the committee. 
 The amount required under the substitute is within the ability and 
 capacity of the company to pay without interfering with the payment 
 of reasonable dividends or with the successful management and opera- 
 tion of the roads. Neither will it require them to increase the price of 
 freight or passenger transportation; on the contrary, it will leave them 
 to pursue a policy dictated alike by common sense and the necessities 
 of business, of gradually reducing to the public the cost of transporta- 
 tion. This substitute, if adopted, will take away every inducement of 
 the companies to divert the business from the main trunk or subsidized 
 lines to other roads, or to lessen in any way the amount of their net 
 earnings. It settles at once all controversies between the Government 
 and these companies, and makes an end of all litigation between them. 
 
 Requiring, as it does, that the companies shall give their consent to 
 it, it yields at once to the Government all right to any moneys now 
 owing for compensation upon aided or non-aided lines and all that may 
 hereafter become due. It gives by consent all that is sought to be ac- 
 complished by the fifth and sixth sections of the bill of the committee. 
 In order that the semi-annual payments may be made certain beyond 
 question it provides that none of the earnings on subsidized or non-sub- 
 sidized roads shall be paid until the bond next maturing or semi-annual 
 
26 
 
 payment has been made. And in order that the indebtedness to the 
 Government may be made absolutely secure it provides not only that 
 the Thurman sinking fund shall he continued, but that the lien of the 
 Government shall extend not only over the subsidized roads but over 
 the whole line of the road. 
 
 I make a part of my remarks a statement showing the mileage of 
 roads operated January 1, 1884, by the several bond-subsidized roads. 
 These are the main and substantial features of the substitute. I have 
 not time nor do I care to enter into details. I am contending for an 
 important principle. If there are any errors in the bill, let them be 
 corrected by amendments. 
 
 Believing, Mr. Speaker, that the substitute is based upon a correct 
 principle, that it will put an end to all the controversies between the 
 Government and the companies, that it will be beneficial to the public 
 in cheapening rather than increasing passenger and freight transporta- 
 tion, that it will quicken the disposition of these companies to pay, 
 that it will lead to a gradual extinction of the debt, and that it will 
 secure its payment and extinguishment of the whole debt beyond per- 
 ad venture, I am heartily in favor of the principle of Mr. Post’s sub- 
 stitute, and with slight amendments it should be adopted. If there is 
 any mode by which additional guarantees and securities can be required 
 from these companies or given by them, I will be glad to vote for any 
 amendment looking to that end. Our object is to obtain a fair, honest, 
 and just settlement of this debt. 
 
 Mr. Speaker, I have presented the reasons why the bill of the com- 
 mittee can not be adopted by the House, and some reasons why a bill 
 embodying the principles of Mr. Post’s substitute must be adopted 
 sooner or later. If the House is not prepared to indorse either of these 
 measures, or has not time in the few hours allowed for debate to give 
 the subject the consideration which its importance demands, then let 
 us stand where we are, leaving these companies as they now are, under 
 their rights as created by the acts of July 1, 1862, and July 1, 1864, and 
 under the operation of the Thurman sinking-fund act — a measure in- 
 tended by its distinguished author to do the maximum of good to the 
 Government and the minimum of injury to the companies. From a 
 long and careful examination of the accounts of these corporations, 
 running through many years, from a full consideration of all the infor- 
 mation which has been furnished our committee by the friends and ene- 
 mies of these companies, I am of the opinion that the Central Pacific 
 and the Union Pacific, including the Kansas Pacific, are able — not with- 
 out difficulty — to comply with their contracts with the Government and 
 successfully carry on and manage their roads, fhat they can not pay 
 any increased amount of their earnings, and that the Sioux City and 
 Pacific can not even do that much; and I submit now, with little or no 
 comment, the facts and figures to show the truth of.what I have said. 
 
 I submit to be printed a statement prepared in the office of the Com- 
 missioner of Railroads, and which is official, of the revenue and ex- 
 penditures of the entire line of the Union Pacific for the year ending 
 December 31, 1883, as shown by the books of the company. It shows 
 the total receipts of the company from all sources to be $23,226,862.77, 
 the total expenditures to have been $22,958,498.05, leaving a surplus 
 of $268,364.72. The amount earned by these roads varies considerably 
 in different years; it may be a million or two more in one year than 
 another, and our committee is informed that the present has been a 
 year of loss and disaster to the company instead of profit. 
 
27 
 
 
 An official statement prepared in the office of the Commissioner of 
 Railroads I make a part of this argument. This statement shows the 
 revenue and expenditure of the entire line of the Central Pacific Rail- 
 way Company for the year ending December 31, 1882. 
 
 The total receipts $26, 675, 502 41 
 
 The total expenditures 26, 640, 390 48 
 
 Leaving a surplus of 35, 111 93 
 
 I submit with what I have to say a statement prepared in the office of 
 the Commissioner of Railroads, showing the revenue and expenditure 
 on the subsidized portion of the said company’s road for the year end- 
 ing December 31, 1882. It shows that after deducting from the amount 
 earned by the company its expenditures, a dividend upon its stock, and 
 the 25 per cent, required by the Thurman act, it would leave a deficit 
 of $170,059.70. 
 
 I also make a part of w T hat I have to say a statement showing the rev- 
 enues and expenditures of the Central Branch of the Union Pacific Rail- 
 road Company, from which it will appear that after deducting from 
 the amount of the receipts of said company its expenditures, interest 
 upon its first-mortgage bonds, and allowing for a dividend upon its 
 capital stock, and taking out the requirement demanded if the Thur- 
 man law is applied to this road. 
 
 I also have had prepared a statement, which I herewith present, show- 
 ing the revenue and expenditures of the Sioux City and Pacific Rail- 
 way for the year ending June 30, 1883. It shows the 
 
 Gross receipts to have been $646, 459 92 
 
 Operating expenses $495, 821 51 
 
 Deducting new construction and equipment 33, 915 28 
 
 Interest on first-mortgage bonds 96, 000 00 
 
 Dividend on stock ($68,736.79) 60,000 00 
 
 685, 736 79 
 
 Leaving a deficit in the receipts of this company of. 39, 276 87 
 
 without paying a dollar under the requirements of the Thurman act if 
 applied to this road. 
 
 It thus appears, Mr. Speaker, that these several companies can with 
 difficulty comply with their contract with the Government and the 
 requirements of the Thurman sinking fund, and that they are not able 
 to do any more than this. It would seem wise, therefore, that we 
 should either adopt the Post substitute or leave these roads as they 
 now are, under the operation of the Thurman act. 
 
 Is the amount owing to the United States by the Central and Union 
 Pacific Railway Companies secure by existing legislation ? 
 
 I do not believe, Mr. Speaker, that there is any doubt whatever about 
 it. For my part, I have no apprehension on the subject. 
 
 I do not believe that there is any danger that the United States 
 will not receive every dollar owing to it by the Central and Union Pa- 
 cific Railroad Companies, and I will occupy the House but a few min- 
 utes in showing that the debt owing by these companies is perfectly 
 secure. 
 
 The amount of bonds advanced to the Central Pacific Railroad Com- 
 pany was $27,855,680. The interest at maturity of bonds will be 
 $50,140,224. Total when due in 1898, $77,995,904. 
 
 The amount of bonds advanced to the Union Pacific was $27,236,512. 
 The interest at maturity of bonds will be $51,000,000. Total at ma- 
 turity of debt, 1898, $78,236,512. 
 
 Now observe and remember that I have in this calculation included 
 
28 
 
 interest for fifteen years in advance, which the companies do not owe 
 and which the Government has not paid. In other words, in this esti- 
 mate is included a sum of about $50,000,000 which would be excluded 
 if we were considering the present indebtedness of these two roads. 
 
 But, Mr. Speaker, let us see, if gentlemen prefer it, what these two 
 companies will owe in 1898, at the maturity of the debt, even when 
 the Government has paid out $50,000,000 that it has not yet paid. 
 Remember that more than $20,000,000 has already been paid by these 
 two companies, and that under existing laws and the Thurman sink- 
 ing-fund act they are required to pay nearly $3,000,000 a year, and 
 while the debt is not being reduced, yet that the annual increase is 
 less than a million a year. 
 
 I desire to read right here a careful estimate, not made by myself 
 but by Mr. W. H. Armstrong, the United States Railroad Commis- 
 sioner, showing the amount which will be owing by the Central and 
 Union Pacific at the maturity of the debt in 1898. The estimate can 
 easily Ibe verified, and is as follows, and will be found in his report of 
 1883, on page 13: 
 
 CENTRAL PACIFIC RAILROAD. 
 
 Principal sura of bonds advanced $27,855,680 00 
 
 Thirty years’ interest, at 6 per cent , 50, 140, 224 00 
 
 Total 77,995,904 00 
 
 Deduct transportation, -&c., approximately, in round 
 
 numbers, first fifteen years $6, 000, 000 
 
 Deduct transportation, &c., approximately, in round 
 
 numbers, last fifteen years, at present rates 13,500,000 
 
 By accumulation of sinking fund for the next fifteen 
 years, estimated at $500,000 per annum, together with 
 amount already in sinking fund, at 3 per cent, per 
 
 annum 12, 500, 000 
 
 32, 000, 000 00 
 
 Balance due United States at maturity of bonds 45, 995, 904 00 
 
 UNION PACIFIC RAILWAY. 
 
 Principal of bonds advanced $27,236,512 00 
 
 Thirty years’ interest, at 6 per cent 49, 025, 721 60 
 
 Total 76,262,233 60 
 
 Deduct transportation, &c., approximately, in round 
 
 nuthbers, for first fifteen years $12,000,000 
 
 Deduct transportation, &c., approximately, in round 
 numbers, for last fifteen years, at the present rate... 16,500,000 
 By accumulation of sinking fund for the next fifteen 
 years, estimated at $900,000 per annum, together with 
 amount already in sinking fund, at 3 per cent, per 
 
 annum 22,500,000 
 
 51,000,000 00 
 
 Balance due United States at maturity of bonds 25, 262, 233 60 
 
 By authority of the act of Congress of July 1, 1864, each of these 
 companies placed a mortgage upon its road to the amount of the bonds 
 advanced by the Government. This is the only lien or incumbrance 
 prior to that of the United States, and the interest thereon has all been 
 paid up. Subject to those mortgages the United States has the second 
 lien on the whole line of these railroads and telegraph, together with 
 the rolling-stock of every kind and description, and the act provides that 
 ‘ ‘ on the refusal or failure of said company to redeem said bonds or any 
 part of them, when required so to do by the Secretary of the Treasury, in 
 accordance w ith the provisions of this act, the said road, with all the 
 
29 
 
 rights, functions, immunities, and appurtenances thereunto belonging, 
 and also all lands granted to the said company by the United States 
 which at the time of said default shall remain in the ownership of the 
 said company, may be taken possession of by the Secretary of the 
 Treasury for the use and benefit of the United States. ’ ’ 
 
 This security on these two roads embraces, therefore, a railroad with 
 a road-bed 200 feet wide, from Omaha to Sacramento City, nearly 2, 000 
 miles in length, with all the equipments in cars and everything neces- 
 sary to constitute a first-class road. Added to this is a telegraph line 
 coextensive with the road, with all the apparatus connected therewith. 
 These roads were built at great expense originally ; they have been im- 
 proved to meet the demands of business; they have constructed im- 
 portant branches and feeders, and now own in all about 3,000 miles of 
 road; are interested largely in many of their branches and connections; 
 they are in full running condition, and are operated under skillful man- 
 agement; the amount of their through and local business is constantly 
 increasing; along their main lines and branches towns and cities have 
 grown up; their business has become vast in amount and profitable in 
 its character. By the time this indebtedness matures, in 1898, the pop- 
 ulation of the United States will have increased to 75,000,000. 
 
 The country through which this road passes will have its full share 
 of this increased population and of the increased business which natu- 
 rally comes from it. When we take all these things into consideration 
 and add to them the power reserved by Congress in its charter over 
 these roads, a power to take possession of the road itself and all of its 
 equipments and property upon a failure to pay its debts to the Gov- 
 ernment, can any man doubt that the claim of the Government is en- 
 tirely secure? 
 
 I have said nothing of the fact that the Central Pacific has laid aside 
 more than $6,000,000 in a sinking fund to meet its mortgage which is 
 prior to the lien of the Government; nor have I said anything of the 
 valuable lands and other property owned by these companies, estimated 
 at many millions of dollars. 
 
 Mr. Speaker, a great deal has been said as to the large amount of 
 bonds advanced by the Government to aid in the construction of the 
 Pacific roads, the amount advanced to each being about $27,000,000. 
 Considering that this money was advanced by a Government represent- 
 ing 55,000,000 of people, there is nothing extraordinary or remarkable 
 about it. Why, sir, the city of Cincinnati, with a population of not 
 more than 300,000 people, a city which stands, however, without a 
 rival in this country for the public spirit of its people and its citizens, 
 issued its bonds to the amount of more than $20,000,000, most of them 
 bearing interest at 7. 3 per cent. , and with the proceeds built and con- 
 structed and now owns a railroad running from Cincinnati, Ohio, to 
 Chattanooga, Tenn., only one mile of which is within the limits of our 
 city, and all the rest of it located in the States of Kentucky and Ten- 
 nessee. We are now leasing this road for about enough to pay one- 
 half of the interest which we pay on the bonds, and we will have to 
 continue to do so until the whole of the bonds are finally redeemed. 
 The people of Cincinnati built this great railroad for the purpose of es- 
 tablishing amicable and business relations with the people of the South. 
 We did not regard this as a matter beyond the ability of the people of 
 one city, but gentlemen upon this floor regard the amount advanced 
 to these railroads as something marvelous and almost bankrupting 
 the Government. Allow me to commend to the House and the country 
 
30 
 
 the spirit of the people of the city which I have the honor in part to 
 represent on this floor, and which issued $20, 000, 000 of bonds to build 
 the Cincinnati Southern Railroad. 
 
 I have said, Mr. Speaker, and I now repeat it, that I believe that 
 the indebtedness owing by these companies to the Government is secure, 
 absolutely secure. In my judgment these two railroads, with their 
 franchises and property and rights, in possession of the country through 
 which they run in full and successful operation, are worth more than 
 $200,000,000. Indeed, I have been told by men of large knowledge 
 and experience in such matters that they are worth greatly in excess 
 of this amount. And now, sir, I have said much more than I intended 
 to say upon the subject of these roads and their relation to the Govern- 
 ment. But these matters have been under constant consideration by 
 our committee for the last six months and the subject has become in- 
 teresting to all of us. 
 
 Mr. Speaker, it will be seen that the advocates of the bill of the com- 
 mittee, and more particularly the gentleman from Kentucky, have 
 made great outcry and clamor against these companies. Frauds com- 
 mitted twenty years ago, and which have no earthly connection with 
 the questions now under consideration, are brought forward to bias our 
 minds and prejudice the House. Language intemperate and unjustifi- 
 able has been used and employed against public men and officials of 
 high and honorable character. Need I say, Mr. Speaker, that all these 
 things are improper, and are wholly foreign to this subject in debate? 
 
 Need I say, sir, to this House or to the country that frauds perpe- 
 trated or alleged to have been perpetrated many years ago in the con- 
 struction of one of these roads can in no wise aid us in a fair and honest 
 judgment upon the matters now before us ? So far as I am concerned, 
 unbiased and uninfluenced by all appeals and considerations of this 
 kind, I stand here as a member of this House endeavoring to the best 
 of my ability to ascertain what are the legal rights of the Government 
 and what are the legal rights of these companies. 
 
 I know no other way of looking at this matter. The rights of the 
 Government upon the one hand and the companies upon the other are 
 to be found, and found only, in the contracts existing between them. 
 I know no difference between the relations that the Government sus- 
 tains to these corporations and to any other citizen. In the eye of the 
 lqw all rights are equally sacred, and certainly those which have been 
 created under the acts of the Congress of the United States ought to be 
 binding upon and respected by us as members of that body. Upon 
 this subject I can not do better than to quote the words of Chief- Jus- 
 tice Waite: 
 
 The United States are as much bound by their contracts as individuals. If 
 they repudiate their obligations, it is as much repudiation, with all the wrong and 
 reproach that term implies, as it would be if the repudiator had been a State, a 
 municipality, or a citizen. 
 
 Our action in the matters now before us should be wise, conservative, 
 just, and fair, and within our constitutional powers. Let us be care- 
 ful, watchful, and zealous in the interest of the people, that every law 
 made for the protection of their interests be enforced; let these com- 
 panies be required to obey their charters, comply with their contracts 
 with the Government, pay to it the uttermost farthing they owe; but 
 when they have done this, let us give them the protection of the law, 
 and see to it that the Constitution itself is not violated in an attempt 
 to deprive them of their vested rights. 
 
Statement showing mileage of roads operated January 1, 1884, by the several companies to which the United States have loaned 
 
 bonds in aid of construction. 
 
 31 
 
 oo'a 
 
 s © 
 
 3 33 
 
 © 0 
 
 O o 
 
 T 3 03 
 
 gf 
 
 £ 3 
 
 .’O'O . . .'O 
 o ® 0 ) O o o « 
 
 ft 1 5 QAA g 
 © > © 
 
 JO J 
 
 'O 'O 
 
 ©oooooo©oooooo 
 
 > © 
 
 O J 
 
 T 3 :' 0'0 
 
 © : c © 
 
 .2 : 3.S 
 
 o ;*■§ 
 
 00 O-S 03 o 
 
 z :«!z : 
 
 TJ 
 
 © 
 
 N 
 
 s 
 
 "S 3 
 
 X! 
 
 . 3 
 
 >> 03 
 
 - 
 
 © O 
 
 t’C 
 
 : © 
 • N 
 
 £'3 
 
 c ’« 
 
 0X5 
 m 3 
 
 <n : ; : 
 33 :T3 
 3 © : © 
 o 8.2 - .2 
 ”'8 •'8 
 
 : _4 
 
 : 3 5 
 
 ; s ; 
 
 3 3 : 3 : : : 
 
 3 ® 0000 fl®b® 0000 
 £ -u-O'O’O’O g +0 E •g' 8 ' 8 ' 3'8 
 
 Jfc 
 
 : O © ©£ 
 
 S So co >o § S 
 
 <N OOONNaH^Mpt'^OCCO 
 50 fflOOOOHOIOlOOlOt'H^O 
 
 J r-J op in co irf oi i> J c4 od © o J © 
 lO lO ^ rH I— I O <N CO CO 
 
 I 5 
 Us 
 i!§ 
 j g a 
 
 lofc 
 
 > H 
 
 «s 
 
 s3 J ’3 ’3 
 OvrOO 
 -o'" C 3 OV 
 
 SgJI 
 
 2 3 
 
 O Oq^'2 ^ 
 
 3 -°oSho 
 : -3 *' .*> J J 40 
 
 ;. 5 P© $ J fl g 
 
 3 
 
 o 
 
 . © 
 • © 
 •"2 ^ 
 
 1 £ 
 . I 1 
 
 X -5 Ph 
 
 I s 
 l^s 
 
 ®"S 5 3 
 
 CD ••-< , 
 
 -a 23 " 
 .So £c 
 
 1 X 5 Eh 
 
 sioagSsigja-aHg 
 
 T3 03 o 2 ’3 i- o^-o ‘3X3. 2 33 3^ 
 
 ©o-:^©©^©^--©-^-" 
 
 o « 
 
 Prq S 
 
 3 o3 o 3 
 
 ooo 
 "Sc S'® 
 
 •c . -o © 
 
 I s 03 
 
 !> o3 
 
 s >, 
 
 TJ © 
 
 j °0 
 
 c3 u 
 OEh 
 
 Jo 
 
 6 -soj 
 
 ^- 0^3 
 u ~ u O 
 - • 03T5 3 - 
 
 1134 
 
 0 0 0 ^^^ 32 ^ 03 03 ^-303 
 
 o_- 
 
 3 
 
 3 ©O 
 
 o S 3 - 
 
 .3 3 
 
 030 
 
 3? 3 
 33 a 
 
 o © 
 A 3 
 2 
 
 GCO 
 
 .. J 2 ? 
 
 1 6 6 o S 
 jAAAj jj S 
 
 oEh ; 5 
 fc O 
 
 'C 
 
 3 
 
 I i 
 
 *3 2 
 « 5 
 
 3 
 
 f ©3 
 
 n 4 3 - r. -- • 
 
 H ooooooS 3 oS 5 ®S 
 " 3 QAQQQA©t<Q©!-Q® 
 h £<2 5-2 x! 
 
 d o 
 *£ 
 
 || 
 
 «* :a 
 
 fl-a « 3 
 
 © 3 © 3 
 
 fcO £o 
 
 ->2 
 
 ^33 - 
 
 0 3 ® 
 
 - CO 
 
 Copperopolis Railroad ...I Stockl 
 
Exhibit No. 1 — Continued. 
 
 Statement showing mileage of roads operated January 1, 1884, <&c. — Continued. 
 
 RAILROADS OPERATED BY THE CENTRAL PACIFIC RAILWAY COMPANY— Continued. 
 
 32 
 
 'C-d 
 
 CO a! 
 
 c3 rr 
 
 5 2 
 i oa 
 © o 
 
 £ is 
 O © 
 
 o . 
 
 'd to 
 
 3 S 
 
 co a 
 
 d© 
 
 50 
 
 woooo o oo oo o o 
 
 dPOQA Q GQ Q Q 
 
 © 
 hp 
 
 I'd 
 : ® 
 
 : n 
 
 C x 
 O ja 
 
 U2 ^ 
 
 o o o-d * o oo oo o d 
 ' ; cs o : : : : : : cs 
 
 K • : : • • : J 
 
 < co 
 
 rH CO 
 
 2S"g ' g 
 
 ci u 
 
 O © 
 - > 
 
 IS |1j 
 SstJl li 
 
 o| i ; jo 
 ©S !3 1.2 
 «SJ D „ J*~ 
 
 O^og «s o M X 
 
 z, ® ^ © © 
 
 8 o of gHEn 
 
 § n"d| e 9 - - 
 
 > 6 ?S <1 
 
 ^ 0202 02W S 
 
 e* £ n w 
 
 H 0) * 
 ^ > c8 
 
 3 82^ 
 
 O 
 
 gpa 
 
 5 5 3= 
 
 -5,^3 N 
 
 ias°^ 
 
 s- ^ 
 
 © dj©"pH a 
 
 PhOo^W^ t» 
 
 « 
 
 bo 
 
 < 0 
 co'd 
 
 o 
 
 h3 
 
 -d <d 
 S3 S3 
 o3 _ o3 
 
 080 J 
 
 . o’fi o 
 
 |S|a . 
 
 cS 'o fe'S H 
 
 ®siHav 
 o g k cj h 
 8:22-® 2 
 
 s ! 
 
 a 
 
 -di 
 
 Ih 
 
 .73 S3 
 
 c3 2 
 
 P3 a 
 
 rt © ©* 
 
 -slsl 
 
 §g§> 
 
 .s^ftQ 
 
 7 fcfS - 
 
 Q Or5 © * 
 
 3 sl-S 
 
 a w GCt 
 
 ^3# 
 
 «a<8£ 
 
 « 
 
 © 
 
 © 
 
 S3 
 
 : © 
 I'd 
 ■d si 
 os 2 
 
 0 a 
 u © 
 dSd 
 
 1 c 
 
 « 8i 
 ©■a 23 
 «£s« 
 
 s! c£ 
 
 - » 
 r— ’ O £ _J 
 
 d33^3 
 
 S3 
 
 K 
 
 3 b 
 W S 
 o & 
 bog 
 .2 o 
 QO 
 
 S3 "S 
 
 »| 
 
 ! 
 
 05 ? 
 * 2 
 © a 
 
 3 a 
 
 -j— 
 a © 
 ^«c 
 
 S c?S 
 
 w £ © 
 
 •3 ft 
 
 Ph S3 
 
 © s o o *- 
 CO JC*-5 
 
 ec 0 » © 
 O c3 
 hPpH 
 
 to O © 
 ©•d - 
 
 1*1 
 
 O 02 
 
 -d . . . . 
 
 © o o o o 
 E ft A AA 
 
 Pi o 
 
 « ft 
 
 o o o 
 
 Q QQ 
 
33 
 
 'O . . 
 “oo 
 
 o 
 
 o o o 
 OOQ 
 
 o> 
 
 15 . 
 
 Mo 
 
 cO 
 
 o 
 
 o 
 
 oocoooooooo 
 
 flfiCQQfifififlflQ 
 
 oocoooooooo 
 
 QfiflfiflQfiflQflfl 
 
 s 
 
 £3 
 
 7. O 
 
 fc 
 
 0000000000“ 
 
 r O r C r O r C r C r C f O F O r ^ r O'* ,^ 
 
 \>Z 
 
 ctioc. 
 Tf i© eo 
 
 8 888 
 
 i-4 ci c4 o 
 
 
 8S 
 
 
 “mNfflotow^Hou; 
 m ira t-h ic eo i— i co t~ eo 
 ic 
 
 a w 
 
 93, 
 
 i-o.2 v 
 i i ge a o’ 
 
 | : C* o <a ft 
 
 > !^ O i 
 
 ■g W Mo 
 
 Mil 
 
 Co'® fto 
 
 |&|ll 
 
 : 'O 
 : fl 
 : o 
 
 o ° = 
 fl'S«S 
 
 1=5 
 
 2 
 
 S£i 
 
 K2 43 5 
 
 
 £ 5 
 
 fl ,. 
 
 _ TSW-S 
 o a 
 *> £ c o 
 
 S d .2 * 
 
 £ Cyg 
 
 $do3£ 
 a.g ® 
 
 g — 1 fl 4JM 
 "0 S 93 93 Or. 
 
 O®.^ fl 
 
 <* M O 
 
 §*. 
 
 «’3 
 
 a I 
 
 os <5Q5 
 
 <3<3<S 
 
 feSS.„ — 
 
 ,rtX5 93 
 
 Hlg^Moo 
 
 II lips 
 
 ?s , gia«g^|-§«^ 
 
 !-s fl =~1o fl = ? : «* O b 
 
 - - O O 93 93 O 
 
 O^UOOOO 
 
 JO 
 
 o 
 
 o o o o H 
 O 000 
 
 « o 
 *0 
 fl 
 
 a 
 
 o 
 
 
 o o fl 
 feOS 
 
 o o^.t: fl 
 
 ® o ^ ® S ® - 
 kOflS -2 T3 2 '-3 fl 
 c»#-£ofl 
 ■(SojjsPcfl 
 
 ioSo«^. 3 ' 
 
 00 .00^0000'" 
 00 £00*0000 S 
 
 A u KL 
 
 CO C* 
 
 a o * 
 
 o o £ 
 
 «*§ 
 
 oo g 
 
 aS| 
 w si 
 
 hi 
 
 "US? S 
 
 s os 6“ 6 2 a a 
 
 •ogagQ&og.aJ 
 
 i •§ S> S 
 IS p o e ,34,* 
 
RAILROADS OPERATED BY THE UNION PACIFIC RAILWAY COMPANY— Continued. 
 
 34 
 
 17 
 
 V 0 
 t-i 
 
 ! ! 
 *2 
 O o 
 
 o . 
 
 ■aS 
 .2 * 
 2 © 
 
 II 
 
 CD 
 
 O *0 . O . . • . 
 
 <3 000 0 0*0^ 0 0 0 0 
 
 O © O 
 
 O h) O 
 
 OQOl^QQOOQQOOO 
 
 HOHHefiioiooO'ijHt, 
 
 3 
 
 M 
 
 o o' 
 
 °o 
 
 06 
 
 O ® - 3 ,-h 
 
 : s §362 
 
 g'ijj- ^-Jo oo ® |Oo 
 
 3 o r£:- 3 © d 3 g 0.^,2 
 ::: ol •::::::: O 
 
 • !■!,:•!!!!: rr ? 
 
 M 
 
 a c’-i 
 
 d 
 
 M H p - 
 
 2 o 6 d 
 0^0^® 
 fe’g « 
 
 Silvia’ 0 : 
 
 oEo r v © 3 
 
 pqpq_!Oi-!0W 
 
 m © : : i-j 
 
 s°jsm 
 
 - s o o © 
 
 & 800 J 
 
 :| l 5 |a 
 
 : d 3 d o © 
 
 :£ O 0 OM 
 
 T2 ■■ 
 d'O 
 O d 
 
 a o 
 
 3 zs 
 
 “5 
 
 2 ►» 
 
 Ok 2 
 
 ■SI'S 
 
 £ 3 * 
 
 ,2 o* 
 
 2M£ 
 
 a 
 
 M go 
 
 gg 
 
 2 c- 
 
 S£w 
 
 « 
 
 *« 
 o<s 
 43 © 
 
 P 
 
 *■« o 3 
 0) 
 
 0) b 
 ££ 
 T) -3 
 
 ” O 
 ©CD 
 
 0^,-0 0 0 0 0 0 0 
 “ • SQQQQQQfi 
 > 
 
 H 3 
 
 d ® 
 cdQ 
 
 ■Jo O 
 
 © o'o 
 
 go 0 
 
 h-s aT S 
 
 'O . .'O 
 ©00© 
 
 p © 
 
 O O 
 
 
 0 :2 
 ffl :« 
 
 03 c 4 1*5 03 ’ 
 
 to 
 
 (M 
 
 O 05 
 
 Jill 
 
 «s © 
 3 c'S.Jj 
 
 .*§ 9 ® © 
 
 ,3 © x •— 
 
 d 
 £ 
 o 
 
 : § 
 
 23 
 
 -1-5 
 •&* 
 
 Sg©o 
 g^sl 
 .21 
 CD O 
 
 o 
 
 iO • 
 
 2 d 
 
 W 2 
 
 r 6 drt'S 6 
 ?QQ oWQ 
 
 9 >» 
 
 © © 
 
>URI PACIFIC RAILWAY COMPANY 
 
 V 
 
 35 
 
 Si 
 
 ii 
 
 !§ a 
 
 Bonds and lands. 
 
 Not subsidized.. 
 
 do 
 
 /I/, 
 
 do 
 
 do 
 
 100 
 
 193 
 
 7 
 
 31 
 
 33 
 
 24 
 
 388 
 
 Waterville, Kans 
 
 Lenora, Kans 
 
 Washington, Kans 
 
 Wo..™, i,.!.- ITnnc 
 
 Burr Oak, Kans 
 
 Bull’s City, Kans 
 
 l l i 
 
 jjj 
 
 J J ji 
 1 1 1) 
 
 Jamestown, Kans 
 
 Downs, Kans 
 
 . a 
 
 « 8 
 s § 
 
 ! ig -4 
 
 ill! 
 
 ! I* s 
 
 i ii 
 
 i jg § 
 
 Ml i 
 i 18 1 
 i flA 
 
 a g s 
 
 
 S£l2 
 
 o *< 
 
 Pi 
 «< «< 
 
36 
 
 Exhibit No. 2. 
 
 UNION PACIFIC RAILWAY COMPANY. 
 
 Statement of the revenue and expenditures of the entire line for the year ending De- 
 cember 31, 1883, as shown by the general books of the company in Boston. 
 
 Earnings : 
 
 Passenger ! $4,659,116 16 
 
 Freight 14,268,291 31 
 
 Mail (less disallowed on main line, $86,917.65) 739, 133 19 
 
 Express 705,261 96 
 
 Miscellaneous 630,739 16 
 
 Gross earnings 
 
 Income from investments : 
 
 Dividends on stocks 
 
 Interest on bonds 
 
 Miscellaneous investments 
 
 $21,002,541 78 
 
 701, 923 04 
 1, 465, 345 00 
 57,052 95 
 
 
 2, 224, 320 99 
 
 Total receipts. 
 
 23, 226, 862 77 
 
 Expenses : 
 
 Conducting transportation 2,596,230 38 
 
 Maintenance of way 2, 095, 077 13 
 
 Motive power 3,778,344 59 
 
 Maintenance of cars 848, 062 73 
 
 General expenses and taxes 1, 036, 825 67 
 
 Total operating expenses 
 
 Discount and interest 32, 094 97 
 
 Interest on first-mortgage bonds 2, 542, 363 58 
 
 Interest on other funded debt 2, 881, 677 92 
 
 United States requirements for 1883 1, 898, 679 85 
 
 Company sinking fund requirements for 1883 476,488 78 
 
 Dividends declared on capital stock 4, 260, 788 00 
 
 New construction 101, 177 22 
 
 New equipment 184, 545 80 
 
 Expenses of the land department 226, 141 43 
 
 10,354,540 50 
 
 12, 603, 957 55 
 
 Total. 
 
 22,958,498 05 
 
 Leaves surplus of. 
 
 268, 364 72 
 
 Exhibit No. 3. 
 
 Statement of the revenue and expenditures of the entire line of the Central Pacific Rail- 
 road Company for the year ending December 31, 1882, ascertained from the general 
 books of the company in San Francisco by the book-keeper of this bureau. 
 
 Earnings : 
 
 Passenger 
 
 Freight 
 
 Mail 
 
 Express 
 
 Miscellaneous 
 
 $7,474,216 12 
 16, 302, 882 72 
 613. 180 88 
 350, 286 21 
 922,191 19 
 
 Gross earnings* $25,662,757 12 
 
 Receipts from other sources : 
 
 Interest on sinking funds (included in both re- 
 ceipts and expenses) 281,260 00 
 
 711 land-grant bonds redeemed (included in both re- 
 ceipts and expenses at par) 711, 000 00 
 
 Earnings, river steamers and barges m 20, 485 29 
 
 — 1,012,745 29 
 
 Total receipts* 26, 675, 502 41 
 
 *Earningsand expenses of the “ entire line,” which means the Central Pacific 
 proper and all the leased lines (Southern of California, Southern of Arizona, and 
 Southern Pacific Railroad of New Mexico) ; total mileage being 3,200 miles. 
 
37 
 
 Operating expenses : 
 
 Conducting transportation $2,729,250 38 
 
 Maintenance of way 2, 766, 941 81 
 
 Motive power 4, 328, 538 85 
 
 Maintenance of cars 946,501 87 
 
 General expenses of operating 1, 093, 222 87 
 
 Total operating expenses 11,864,455 78 
 
 Rentals leased lines *.. 4,202,727 89 
 
 Total operating expenses and rentals* 
 
 Discount and interest — balance after crediting the 
 account with $89,000 on account- of Southern De- 
 
 velopment Company, Stockton and Copperopolis 
 
 Company, and Pacific Improvement Company 198,021 65 
 
 Taxes paid during the year : 
 
 General 404,722 89— 448,205 69 
 
 General administration expenses 330, 646 72 
 
 Legal expenses 216,750 41 
 
 Civil engineering 15,479 65 
 
 Land department expenses — less receipts from lands 
 
 rented, $13,336.26 23,700 78 
 
 Interest on first-mortgage bonds of the aided portion 
 
 of the road, paid 1,673,940 00 
 
 Interest on first-mortgage bonds of the non-aided 
 
 portion of the road, paid 1, 571, 451 67 
 
 United States requirement for sinking fund 792, 920 24 
 
 Company’s sinking-fund requirement 1,034,760 00 
 
 Land bonds redeemed with proceeds of land sales... 711, 000 00 
 
 Dividends Nos. 13 and 14 on capital stock 3, 556, 530 00 
 
 $16,067,183 67 
 
 10,573,206 84 
 
 Total..., 26,640,390 51 
 
 Surplus on operations for the year 35, 111 90 
 
 Exhibit No. 4. 
 
 CENTRAL PACIFIC RAILROAD COMPANY. 
 
 Statement showing therevenue and expenditure on the subsidized portion of the Central 
 Pacific Railroad Company , 860.66 miles, for the year ending December 31, 1882, as 
 ascertained by the book-keepers of this bureau from the books and accounts of the 
 company in San Francisco. 
 
 Earnings : 
 
 United States : 
 
 Passenger $35,988 01 
 
 Freight 59, 929 16 
 
 Mail 307,837 09 
 
 Commercial : 
 
 Passenger.. 2,537,811 26 
 
 Freight 6,007,461 22 
 
 Express 119, 809 36 
 
 Car service 
 
 Rent of buildings. 
 Miscellaneous 
 
 $403, 754 26 
 
 8,665,081 84 
 7, 165 23 
 18,067 00 
 486,547 61 
 
 Total earnings 9,580,615 94 
 
 Expenses : 
 
 Conducting transportation .• $728,722 49 
 
 Maintenance of way 1, 170, 138 80 
 
 Motive power 1,605,367 09 
 
 Maintenance of car 313,715 98 
 
 General expenses and taxes 917, 050 63 
 
 Total operating expenses 
 
 4,734,994 99 
 
 ♦Earnings and expenses of the “ entire line,” whichmeans the Central Pacific 
 
 S roper and all the leased lines (Southern of California, Southern of Arizona, and 
 outhern Pacific Railroad of New Mexico) ; total mileage being 3,200. 
 
38 
 
 Interest paid on first-mortgage bonds having priority 
 of lien over the United States bonds $1, 673, 940 00 
 
 Total $6,408,934 99 
 
 Net earnings, so ascertained 3, 171, 680 95 
 
 Twenty-five per cent 792, 920 24 
 
 Net earnings * 3,171,680 95 
 
 Twenty-five per cent, of net earnings 792, 920 20 
 
 Surplus 2,378,760 75 
 
 Deduct a dividend on stock 2, 548, 820 45 
 
 Deficit of. 
 
 170,059 70 
 
 Exhibit No. 5. 
 
 Earnings and expenses , year ending December 31, 1882. 
 
 [100 miles subsidy portion.] 
 
 Earnings : 
 
 Passengers 
 
 Freight 
 
 Mail 
 
 Express 
 
 Miscellaneous 
 
 $106, 344 15 
 386,779 22 
 12,538 58 
 4,955 64 
 17, 447 24 
 
 Total 
 
 528,044 83 
 
 Transportation 78,789 55 
 
 Maintenance of way 86, 198 80 
 
 Motive power 93, 610 53 
 
 Maintenance of cars 24, 473 97 
 
 General and taxes 8,778 21 
 
 291, 851 06 
 
 204,962 76 
 
 Total 
 
 Deduct interest on first-mortgage bonds 96, 000 00 
 
 Twenty-five per cent, of net earnings 48,962 76 
 
 Dividend on capital stock 60, 000 00 
 
 86, 888 30 
 
 WM, H. ARMSTRONG, Commissioner. 
 
 Department of the Interior, 
 
 Office Commissioner of Railroads, 
 
 Washington, D. C., April 9, 1884. 
 
 O