226 



THE IRRIGATION AGE. 



statement that the best business heads in England 

 pronounced irrigation bonds to be certainly the favor- 

 ite security of the future, but he said, with even 

 stronger emphasis: "Your projects will be investi- 

 gated hereafter from top to bottom by men thoroughly 

 known to us. We will take nothing more on faith. 

 Convince us that you have a safe thing and our money 

 will be forthcoming.'' The New York lawyer heartily 

 concurred in these opinions, speaking from his own 

 observations. He said irrigation securities were 

 beginning to be favorably known, and that the phys- 

 ical elements back of them lands enormously pro- 

 ductive when watered, and the water supply and 

 canal system, on which their productiveness absolute- 

 ly depends were recognized as the best foundation 

 for security, when associated with good plans for 

 colonization. All that these gentlemen had said was 

 confirmed by the second foreigner, who had spent 

 several months in a thorough examination of cer- 

 tain irrigation plants, and declared that the investi- 

 gation had settled the merits of the industry beyond 

 all question in his mind. The party was unanimously 

 of the opinion that the present is a favorable time to 

 formulate plans for extensive development, and that 

 if no unforeseen disaster overtakes the industry, capi- 

 tal and settlers will be found in abundance, and we 

 shall enter upon a long period of prosperity in the 

 business of reclamation and colonization. 



Danger Speaking, then, from a good knowledge 

 ^to^be** f t ^ ie s ' tuat i n throughout the United 

 Guarded. States, as studied in recent personal 

 visits to both sides of the continent, and from the 

 best of hearsay evidence about conditions abroad, we 

 say without the slightest hesitation that the outlook 

 for Western America in general, and irrigation in 

 particular, is most flattering. But there are certain 

 grave dangers to be guarded against. It is within 

 the power of unscrupulous or incompetent men to 

 very seriously impair the confidence of both the 

 investor and the settler. A few reckless projects 

 successfully unloaded upon the market, and a few 

 settlers deluded into making their homes on poor 

 land, or under a doubtful water supply, and confi- 

 dence in irrigation and all that pertains to it will be 

 stricken down. But if it is within the power of a few 

 men to work disaster, it is still more clearly within 

 the power of a few men of a different type to prevent 

 it. For it is much easier to discredit an enterprise 

 than to float it much easier to keep settlers out of a 

 locality than to coax them in. There is not the 

 slightest need of repeating in the case of irrigation 

 the hard lessons that have been taught, at different 

 periods, by town-lot booms, wildcat mining specula- 

 tions and thrice-counted cattle deals. No one can 

 foretell the destiny of a new town, or fathom the 

 mysteries of a mine, but irrigation rests on things 



that can be seen and measured, and results are 

 worked out by means of plain, ordinary human in- 

 dustry. There are plenty of good enterprises and 

 therefore not the slightest excuse for anybody to 

 engage in doubtful ones. And yet there have been 

 some unfortunate results in connection with irrigation 

 investment and with settlement upon irrigated lands. 

 It is well to speak plainly of the methods by which 

 such misfortunes may be hereafter prevented. 



The most important failure in the irriga- 

 The Bear . 



Valley In- tion world the only failure that has at- 

 stance. tracte( j international attention was that 

 of the Bear Valley Irrigation Company of California. 

 That enterprise was regarded as the type of irriga- 

 tion investment. And, strange to say, it is destined 

 to be so regarded again. It is a property of extraor- 

 dinary and undisputed values, but its managers cap- 

 italized the future and clipped coupons from their 

 imagination. Industrial development gave place to 

 stock manipulation. There may not have been a 

 particle of studied dishonesty in the whole transaction, 

 and yet with proper vigilance on the part of those 

 who should protect the public from imposition Bear 

 Valley stock could not have been sold on the basis of 

 a fifteen per cent, dividend-paying investment. Here 

 was an enterprise whose merits warranted the liberal 

 investment of capital, whose values were and still 

 are so large and substantial as readily to command 

 between one and two millions of eastern and foreign 

 money, and yet it is perfectly plain, in the light of 

 the present receivership, that investment was invited 

 and obtained on terms that were hazardous. The 

 irrigation industry was not at fault, but the irrigation 

 industry has suffered the consequences of the failure. 

 The world learns by experience. There should never 

 be another failure due to the same causes as those 

 that produced the temporary defeat, with accom- 

 panying losses, of Bear Valley. Enterprises that are 

 floated on the still hunt plan, and about which invest- 

 ors made no inquiry from disinterested sources, may 

 still breed disappointment and distrust, but it should 

 be easily possible to prevent wholesale deception in 

 the case of projects placed publicly on the market, or 

 in the case of those where intending investors make 

 a proper effort to learn the truth. 

 Defrauding What has been said of investment in 

 Hvnie- secur iti es mav De sa 'd with still greater 

 Seeker, force with reference to investment in 

 small tracts of irrigated land. The man who takes 

 all the money he possesses and invests in a little 

 farm on which he must make his living is properly a 

 greater object of solicitude than the man who invests 

 his surplus capital in bonds. To cheat the home- 

 seeker is an unpardonable enormity. This has been 

 done only to a very slight extent, but there is one 

 grievous instance in California, now in process of 



