AN UNSETTLED ACCOUNT--A GUILTY DIRECTORY.
We now invite the attention of the reader to the account as it now
stands with the subsidy bonds voted by congressmen to companies in which
many who voted were stockholders and directors.
As the law stood prior to April, 1871, all railroad companies that had
received government lands were required to pay the interest once in six
months as it accrued. This interest had not been paid, and the secretary
of the treasury withheld, to apply on the accrued interest, the amount
earned by the different companies by the transportation of the mails,
troops, &c., for government. Congress, composed in part of stockholders
and directors in these same companies, passed a law ordering the
secretary to pay in money to the different companies one-half of the
amount thus earned, and left it optional with the companies to pay, or
not to pay the interest on their bonds. This they have not done, and the
interest account of these companies with the government stands about as
follows:--
Central Pacific, paid $ 527,025 Bal. due $5,841,351
Kansas Pacific, " 973,905 " " 995,448
Union Pacific, " 2,181,989 " " 4,779,763
Central Branch, U. P., " 15,839 " " 477,969
Western Pacific, " 9,350 " " 358,329
Sioux City & Pacific, " 826 " " 388,780
Making the total amount of payments the sum of $3,708,935, and the
amount that these companies owe government, as the accrued interest on
subsidy bonds, $12,861,640. This is the amount due in July, 1872. Add
the interest accruing since that date and these companies owe the
government not less than $16,000,000 interest on their bonds. This
amount, as well as future interest, and the principal of the bonds was
at one time secured to the government; but when congressmen and their
friends get a controlling interest in the companies, they procured the
passage of an act, supported by their own votes, which destroyed the
security held by the government, and relieved the companies of the
payment of this large amount of interest, thereby compelling the people
to pay it, while the stockholders, including some of the same
congressmen who had voted in favor of the act, received dividends on
their stock and on their _Credit Mobilier_ stock to the amount of two
and three hundred per cent; thus, by the abuse of the power vested in
themselves as members of congress, compelling the people to pay the
interest the companies should have paid, and pocketing in the shape of
dividends the money so dishonestly obtained. If we needed any further
proof to establish the fact that these Pacific railroads were in fact
congressional jobs, that members of congress were looking to their own
interests rather than to the interests of the people, we need but glance
at the interest account of the Sioux City & Pacific company. The excuse
pleaded of the "necessities of government," will not avail in this
instance. While the interest account of this company is about $400,000,
the account for the transportation of troops, mails, &c., over its road,
amounts to the sum of $1,642, one-half of which has been applied on the
interest account of the company, and the other half, under the act of
congress, has been paid by the secretary of the treasury to the company.
The conclusion is irresistible, that the personal interest of
congressmen, rather than the wants of the public, has controlled their
action.
Connect with the incorporation of railroad companies, and special
legislation in their favor, the legislation in favor of "Indian rings,"
"whisky rings," "patent right combinations," and the numerous other
kinds of special legislation, with the advantages presented to
legislators to make personal gain from all these sources, and we can
well understand why men are willing to spend such large sums to secure
an election to the United States senate, or house of representatives.
The baneful effects of the modern code of political morality are not
seen in the legislative department of the government only. The same
disregard of the rights of the people, and a determination to protect
and aid combinations in their efforts toward self-aggrandizement, made
at a sacrifice of those principles which are supposed to govern all
persons holding places of trust, honor, or confidence, seem to influence
to a great degree those holding high position in other departments of
the government. The acts of congress chartering the Pacific railroad
companies make it the duty of the president of the United States to
appoint five government directors for these roads. Under the statutes
these directors cannot own stock in the companies, nor have in them any
personal interest whatever. They are supposed to be free from any bias
for or against the companies: but they are appointed to represent the
government, and to guard against and report to the secretary of the
interior all abuses on the part of the companies, and at such times as
they are required to so report, to also make such suggestions as in
their opinion shall best subserve the interests of the public. It is
made their duty to personally inspect the roads, during their building
and after their completion. At least two of these government directors
must have a place on all important committees appointed by the companies
for the management and prosecution of their business. Any dishonesty on
the part of the companies in letting contracts for the construction of
their roads, or any misapplication of the grants made by congress, must
have been known to these five government directors, or some of them, if
they had properly discharged the duties imposed upon them by law. The
formation of an inside ring, under the title of "The Credit Mobilier of
America," composed entirely of the directors and stockholders of the
Union Pacific company, the letting of the contract for the construction
of the road to one of the directors of the railroad company, who was
also a director in the Credit Mobilier (and a member of congress), at
more than double its actual cost, the transfer of this contract to
certain trustees who were directors in both companies, in the manner
stated in a preceding chapter of this work, and the declaration of large
dividends on the stock of the companies at a time when the work on the
road was barely begun, and before any dividends could possibly have been
earned,--all these facts must have been known to the government
directors, and concealed by them from the government. When it is
remembered that some of these government directors were members of
congress at the date of the passage of the acts chartering the roads,
there is but little question that the same influences controlling them
in voting these large subsidies to the companies also controlled them as
government directors in their supervision of the roads. This conclusion
is strengthened on seeing that some of them became owners of stock in
the Credit Mobilier.
The same corrupting influences have been felt in other departments of
the government. The abuses practiced in the collection of customs by the
officers at the different ports of entry, as shown at the recent
investigations made by authority of congress, are but the natural
sequence of the questionable course of the legislative department. The
great frauds practiced by parties having contracts for furnishing
supplies to the Indian tribes are traceable to the same source. This
assumption by congress of the power to grant charters to private
monopolies, its unconstitutional interference in matters reserved to
state control, its determination to foster these gigantic corporations
by princely grants, with the corruption incident to these selfish and
greedy combinations, are the direct cause of the dishonesty prevailing
everywhere among our public officers, and besides other rank growth have
led to the imposition of burdens upon the people, oppressive to the last
degree. The controlling purpose of a large portion of those elected or
appointed to government offices seems to be to accumulate wealth without
regard to the propriety or honesty of the means employed. In their
eagerness to benefit themselves, all consideration for the public good,
or respect for their obligations as sworn servants of the people, are of
secondary importance. They accept office from purely selfish motives,
and enter upon their duties with the same object in view animating those
who embark in trade, manufactures, or commerce, viz: private gain.
Seemingly viewing the offices they hold as being their own private
property, they use them as the banker uses his money--for purposes of
speculation. Not unfrequently they permit themselves to be bought and
sold, like any other articles of merchandise. While we do not claim that
all public officers were pure prior to the legislative creation of the
monopolies we have been examining, we do claim that previous to that sad
departure, honesty was the rule, and not the exception. It was when
congress entered upon the business of chartering railroad companies,
donating public lands to them, and voting them money from the public
treasury, that the rule changed; and when, in addition, congressmen
became principal owners and directors in these companies, while still
retaining their seats in congress, they placed themselves upon the
record as unfaithful to their trust, and struck a blow at public
morality which will be fatal to our popular government, unless resisted
by the whole moral power of the nation.
And here we might well pause, and ask, what security have the people for
the continuance of republican government? These gigantic corporations
are in their nature anti-republican; they tend to a centralization of
power; they compel the people to submit to their demands; they are under
the protection of congress, under whose special legislation they are
permitted to disregard state laws; their ramifications extend throughout
the country; their artifices and money control the votes of the people;
they elect their friends to both the senate and house; they organize and
send strong bodies of men to the lobby of congress and state
legislatures, well supplied with money to obtain the passage of laws in
their interest, and to prevent such legislation as would be detrimental
to them, and in favor of the people; they have their friends and
emissaries in every department of the government, and throughout the
country, and they exercise a controlling influence not only at
Washington, but at almost all the seats of state government. The offices
filled by appointment of the executive and confirmation of the senate,
are too often the agencies of this same influence. We would not be
understood as saying that the president acts corruptly in these
appointments; we mean that the influences that secure many of the
presidential nominations are the same as used by these corporations in
the election of _their_ senators and representatives. The appointment of
judges of the supreme court of the United States has, in at least two
instances, within the last few years, been made through the influence
and in the interest of these monopolies. These corporations are also
represented in the cabinet. It is well understood that the removal of
Attorney General Ackerman, and the appointment of his successor, was
done by these corporate influences. The fact that the secretary of the
interior, to whom reports should have been regularly made of the
progress and condition of the Pacific railroad, was silent, while
private fortunes were being fraudulently taken from the public treasury,
proves that he also was under the same influence. It can be accepted as
an established fact, that all the departments of the government are to a
great extent controlled by corporations and combinations of speculators
whose interests are adverse to those of the people, and the result is,
that statutes are enacted, executive offices appointed, and decisions of
court rendered in the favor of these powerful classes, while the rights
guaranteed to the people by the constitution are disregarded.
The influence of corporations is also powerful in the administration of
state governments. While no such gigantic monopolies as the Pacific
railroad have been organized in any state yet, either by special
charters granted by state legislatures, or under general incorporation
laws, railroad corporations in large numbers have been organized, and by
combining their influence, have obtained control of most of the state
governments; they have been granted special and exclusive privileges,
and by the use of money and patronage have been able to control state
conventions, state legislatures, and state courts. As a logical result,
the people are taxed, while railroad companies are practically free from
taxation; subsidies to corporations are authorized and declared to be
constitutional, and the people are obliged to submit to rates of charges
for transportation of freight that amount to a confiscation of the farm
products of the country. We need not enter into a history of state
grants to railroad companies, for it is familiar to all; the same
corrupt practices incident to national, attend state, legislation. In
many instances, corporations have organized under state statutes, or
obtained special charters from state legislatures, located their roads,
procured local aid, and then obtained from congress land grants for
their roads, and have thus become powerful in the states where they are
located, while other companies have built their roads exclusively with
the means afforded by local aid voted under state laws, and loans of
money or sale of bonds; but in every instance so planning and contriving
that the entire road shall pass into the exclusive control of a select
few, leaving to those who furnished the local aid no rights or
privileges in connection with the company, or the road, save that of
paying extortionate freights and burdensome taxes.