476 THE GROUNDSWELL. 



THE GREAT CREDIT MOBILISE. 



The American swindle was originally more an imitator in 

 name than in actual organization. A charter had been 

 issued in Pennsylvania to a company, but had not yet been 

 used. The Credit Mobilier bought this loose charter, its 

 stockholders and those of the Union Pacific Eailway Com 

 pany being identical. The railroad company had been en 

 dowed by Congress with twenty alternate sections of land 

 per mile. The government had also agreed to loan it $16,- 

 000 for some two hundred miles, then $32,000 per mile for 

 six hundred miles, and from thence $48,000 per mile. The 

 Union Pacific Eailway Company issued stock to the amount 

 of $10,000,000, which stock was received by the stockholders 

 upon the payment of five per cent, of its face value. 



At this point the Credit Mobilier steps in. All the assets 

 of the railroad company were turned over to this new com 

 pany, in consideration of full paid shares of the new com 

 pany s stock and its grant to build the road. In the mean 

 time, the government had been induced to allow its first 

 mortgage bonds to become second mortgage bonds ; where 

 upon the Union Pacific Eailroad Company issued first mort 

 gage bonds, which, of course, took precedence as a loan, and 

 the government lien immediately became virtually worthless, 

 since the new mortgage bonds amounted to the entire value 

 of the road. The proceeds of this shameless transaction 

 went to swell the ill-gotten hoards of the rascals who devised 

 it, and the innocent Congressmen who helped to engineer 

 the scheme. The Credit Mobilier had nothing to pay, 

 except the mere cost of construction, the bonded debt of 

 the road exceeding by $40,000,000 the cost of building the 

 road. Is it strange that shares with which Congressmen 

 were allowed to load up at $100 each, could not be pur- 



