THE IRRIGA Tl ON A GE. 47 



question. In other cases parties have concluded that the project was 

 better to skin than to keep and have left the bondholders in the lurch 

 by doing it. When they take possession of the works they find the 

 shell tolerably empty. In some cases this has been honestly done, 

 the water being sold out too cheap or other bad contracts made in the 

 distress in which projectors often find themselves and when it looks 

 as if any sort of a bargain would help them out. 



It is said that capital does not enquire into the causes of failure 

 but looks only at general results. This is so far true that it is for the 

 interest of us all that there be no failures and nothing to explain away. 

 But it is quite as true that there is some capital that will always listen 

 to such explanation and enquire into it. And there is a difference be- 

 tween an actual failure and only an apparent one. And the chances 

 are that investigation would show the majority of failures apparent 

 only as explained above or as in the next class of cases. 



One of the best land owner's companies of Southern California 

 owes something like six hundred thousand dollars. It pays its inter- 

 est yet it is called a financial failure because it ought to be out of debt 

 or at least diminishing its debt instead of increasing it. This company 

 has for years paid luxurious salaries not to reimburse anybody but as 

 a matter of pride or style, fought everything in sight on the river and 

 paid lawyers tens of thousands. But this is far from all. It owns 

 about four thousand acres of fine orange land and has water enough 

 to supply it. This is land that was left over from the block out of the 

 sale of which the water works were built and cost only some ten or 

 fifteen dollars an acre. It was turned over to the company when the 

 projectors made a land owner's company of it and they had made 

 enough out of what was before sold to pay a handsome profit on their 

 investment and time, besidethe land and water they retained to culti- 

 vate in their own company, which land is now a valuable property. 

 These four thousand acres could have been sold during the great 

 boom of 1886-7 for three hundred dollars an acre. It was not enough. 

 It was "giving it away." 



The year after the boom broke they could have been sold for 

 three hundred an acre. But that was "throwing it away." 



Five years after that they could have been sold for two hundred 

 an acre. But that was "madness." 



Even last year after all the hard times they could have been sold 

 for probably one hundred and fifty, certainly for a hundred. But 

 that would be worse yet. 



Is this company a financial failure because it still owes six hun- 

 dred thousand dollars, when its purpose is to furnish several thousand 

 acres with water, which it is doing and bringing in a profit of a million 

 or more a year and supporting a settlement of some seven thousand 

 people in the best of style? Yet that is what the world would say, 

 looking only at the bonded debt. It would say there is something 



