Democratic Sentinel, Volume 2, Number 10, Rensselaer, Jasper County, 19 April 1878 — DEFELT OF THE LOBBY. [ARTICLE]

DEFELT OF THE LOBBY.

The Pacific Radiroad Funding; Bill. After a long and desperate resistance compel the subsidfeed Pacific railroads to provide for the payment of the debt they owe the Government has passed the Senate by the handsome majority of 40 to 19.. The struggle has been one of the Government against the lobby, and the interests of the people against the interests pf a railroad ring; the result is a triumph of patriotism over the corrupt influences that opposed it The provisions of this bill are, in brief, that the railroads shall pay to the Government one-fourth of their net earnings annually, to be applied in part to the payment of the interest on the bonds anfl bi part to a sinking fund for the ultimate liquidation of the principal at the maturity of the bonds. The net earnings are to be ascertained not merely by deducting the operating expenses and repairs, but also the interest on the first-mortgage bonds, so that the exaction from the companies is virtually but one-fourth of the sum that would annually be divided among the owners of fictitious stock. Under the bill, the Union Pacific will be required generally to pay only $150,000 annually, and the Central Pacific only $300,000 annually, in addition, to the amount charged for Government services. Fortunately the act is so thorough and guarded that the payments cannot well be avoided; it permits no dividends till these payments are made, and makes it a penal offense for any officer or stockholder to declare or partake of such fraudulent dividends. In regard to the ability of the roads to comply with the requirements of the bill, the following figures will set the questiynat rest: The gross earnings of the Union Pacific railroad last year were $13,719,343, an increase of $1,605,353 over the previous year; and the operating expenses are $5,402,253, being a decrease of $45,867 from the pieceding year, showing net earnings to have been $8,317,000. The Central Pacific makes an equally good showing. It net earnings for the five years ending with 1876 were as fol lows: 1872 $8,952,361.73 1873 7,894,681.46 1874 8,312,898.76 1875 9,177,882.09 1876 9,137,004.73 Total for five year 5541,504,828.77 Average annual net receipts 8,300,965.75 The gross ’earnings of the two roads were $31,033,803 in 1877, and their net earnings are $16,600,000; and their claim that they cannot pay the sums required of them by the Thurmvn bill for a sinking fund to extinguish the debt they owe to the Government is therefore manifestly absurd. Last year the roads paid out of their net earnings $6,612,815 interest on their bonds, and $7,299,000 in an 8 per cent, dividend to stockholders, leaving a surplus of $3,121,702 unexpended. It is clearly unjust for the roads to distribute their profits in dividends until they shall have made provision for paying the debt they owe the the Government.