The Days of a Man 



1893 



Govern- 

 ment aid 

 to Central 

 Pacific 



debt of $27,000,000 (now risen to $60,000,000 from 

 accumulation of interest) originally borrowed from 

 the Government by the Central Pacific Railway 

 Company, should mature and be paid. This was a 

 peculiarly arbitrary proceeding, as these notes were 

 not due for a number of years the first in 1895, 

 the last in 1899. Concerning the whole matter 

 there was much misunderstanding as well as wanton 

 misrepresentation. 1 The essential facts, easily veri- 

 fied, I may here present in some detail. 



In the construction of the Central Pacific Rail- 

 way, the four builders exhausted their funds and 

 their personal credit, even with the large conditional 

 grants of government land along the line holdings 

 which were, of course, worthless unless the road 

 could be put through. 2 The United States Gov- 

 ernment then came to their further aid with the 

 loan mentioned above, for which it took a second 

 mortgage on the property, although the first mort- 

 gage, held in private hands, was generally thought 



1 Most of the then current accusations against the Southern Pacific Com- 

 pany in its relations to the Government were based on the assumption that 

 the loan would never be paid; it was, however, paid in full, with interest, on 

 the days it became due. 



It is not necessary here for me to -defend or criticize the conduct of the 

 Southern Pacific Company in acquiring political domination in the state. 

 That is a matter in which I had no part; and while the relation of local 

 officials with the University was most cordial, the Stanford interests were more 

 or less divergent from those of the other partners. It was asserted on the one 

 hand that "the railway controlled the press of the state through judicious ad- 

 vertising, disarmed opposing attorneys through fees, and managed the legisla- 

 ture through a political agent whose duty it was to prevent the election of an 

 unfriendly majority." On the other hand it was claimed that "without such 

 arrangements, the integrity of the railway properties could not be secured 

 against 'cinch bills' and blackmailing attacks, the latter often in the guise 

 of reform. When the danger from such sources abated, the railway went out 

 of politics." 



* It should also be noted that with the exception of the Humboldt and 

 Truckee valleys, timbered areas in the Sierras, and fruit lands in the foothills, 

 most of these tracts are still valueless. 



C 500 H 



