Part 6 (2/2)

_Fourth._ The aid granted to railroad companies has enabled them to get control of the commerce of the country. As a general rule, all of the railroads receiving subsidies in land, government, state, county, and city bonds, and large gifts in local taxes, have been owned or controlled by the same cla.s.s of men, and not a few of the roads by the same ring or combination. Then speculators have visited all parts of the country, claiming to be men of ”large hearts” who desire to benefit mankind. They talk of their large experience in railroad matters; of the great benefit the particular locality will derive from the construction of a certain line of road; of the great profit to be returned in the shape of dividends if local aid is voted, and after having by fraud, falsehood, and willful deception induced the people to move in the matter, they then turn their attention to state legislatures and to congress for more aid, and so perfect is their combination, that in almost all their attempts they are successful. Among these rings and combinations are found men to fill every department in the scheme for plundering the people. Some of them become directors in the corporations to which the aid is voted and granted, and they thus get control of the donations, grants, and bonds. Some members of the ring become agents to sell the bonds of the corporation, as well as any others received from the general or local government, and to mortgage the lands granted to the companies. Still another division of the ring become the purchasers of the bonds at their _market_ value. They all unite in this way and mortgage their roads, rights, and franchises, and construct the road, taking care that when the road is completed, the liabilities resting upon it shall be sufficient to represent its entire value. By this means they become the creditors of the counties and towns through which the road runs; they own and control the road; and the combination being the same substantially throughout the country, owning and controlling all the roads, holding and using the subsidy bonds, fixing the rates of freight and pa.s.senger transportation, they control the whole country and hold the best interests of the people subject to their will. In the prosecution of their ends they bribe local officers, state legislatures, and members of congress. To secure the election of their friends to congress, large gifts are made. In one instance one of these raiders upon the rights of the people bestowed upon a prospective United States senator, $10,000, for the purpose, as he stated, of securing friendly legislation for a certain railroad company. The pirates and robbers who prey upon mankind are not more dishonest or unscrupulous than are these rings who make the people their prey. They differ only in the degree of punishment received; the former being executed or sent to prison, while, of the latter, many are elected to congress or to other high and responsible offices, or they are appointed to high places of trust and profit in the government. If the reader will look through the _Railroad Manual_, he will find a long list of names of men, prominent now from the recent raids upon the people and public treasury, who have been engaged in the same business for at least twenty years; men whose names are now as familiar to the western people as ”household words,” who, like birds of prey, have flitted from one part of the country to another until their blighting influence is felt in the whole land. We are referring of course to the men who have followed the business of ”organizing” railroad companies for the purpose of procuring aid in lands, bonds, and taxes, and who have devoted their energies to this cla.s.s of railroads, and not to those capitalists who, with their own money and credit, have constructed their roads and pursued a legitimate business. Prominent among the men who have devoted their time and talents to railroad enterprises, will be found the names of Thomas C.

Durant, John A. Dix, Henry Farnham and others, whose memory will remain fresh with western men, because of their diligence in procuring local aid to railroad companies from counties and cities fifteen or twenty years ago, and who, after obtaining such aid, by some means became the owners of city and county bonds, to a large amount, and then to prompt the people to greater diligence in the payment of taxes, levied to liquidate these bonds, applied to the president of the United States for troops to aid in their collection. Slightly varied, the same organization of men which inaugurated the system of constructing railroads through land grants, donations, and subsidies, is still in the same business. With their headquarters in New York and Boston; with Wall Street as the princ.i.p.al depot for all railroad stocks and bonds, as well as the bonds of the United States, and of such states, counties, and cities as have been duped by them, these _raiders_ upon the treasury and resources of a people have taken the absolute control of the railroad interest of the country, and ”run it” for their own exclusive benefit, to the injury of the country and the absolute destruction of the agricultural interests of the great west. By having placed in their hands the large grants of land and subsidies voted to railroad corporations, they acquired the means of controlling the princ.i.p.al roads throughout the country. Roads in Texas, Louisiana, Alabama, Arkansas, Kansas, Nebraska, Iowa, and in other states and territories, are owned and managed in the exclusive interest of capitalists in the eastern cities who have no interest in the communities where these roads are located, save to realize large dividends by extortions and oppressions.

All of the roads receiving large grants and subsidies, whether from the general or state government, or as local aid, are in the hands of this cla.s.s of men, with their fiscal and transfer agencies in the cities above named.

This statement has its ill.u.s.tration in the Kansas City, St. Joseph, & Council Bluffs company, which has five directors in Boston, two in New York, one in Michigan, and one in Missouri--Fiscal agency and transfer office, Boston. Peoria & Bureau Valley company has its princ.i.p.al office in New York; Chicago & Northwestern--Financial and transfer office, Wall street, New York; Dubuque & Southwestern--all of the directors, save one, and its financial agency, in New York; Atchinson, Topeka, & Santa Fe company--fiscal agency and transfer office, Boston; Galveston, Harrisburg, & San Antonio company--Fiscal and transfer agency, Boston; Leavenworth, Lawrence, & Galveston company--Fiscal agency and transfer office, Boston; Kansas City & Sante Fe company--Fiscal and transfer agency, Boston; Cedar Falls & Minnesota company--All of the directors reside in New York; Iowa Falls & Sioux City company--Of the directors, John B. Alley, Oliver Ames, P. S. Crowell, and W. T. Gilden, reside in Ma.s.sachusetts, J. I. Blair in New Jersey, and W. B. Allison and Horace Williams in Iowa--Fiscal and transfer agency, Boston; Colorado Central company--Of the directors, Oliver Ames, Frederick L. Ames, and four others, reside in Ma.s.sachusetts, and the fiscal agency is in Boston, and the princ.i.p.al office in California; Cedar Rapids and Missouri River company--John B. Alley, Oliver Ames, and nine other of the directors are in the eastern states, and James F. Wilson, and three others, are of Iowa; Northern Pacific company--Princ.i.p.al office, New York; Hannibal & St. Joseph company--Fiscal and transfer office, New York; Burlington & Missouri River company--Fiscal and transfer office, New York; Union Pacific (central branch)--All but two of the directors in Was.h.i.+ngton City and the east, and princ.i.p.al office in New York; Union Pacific--Among the directors are Oliver Ames, Oakes Ames, and eleven others in New York and Ma.s.sachusetts, one in Illinois, and G. M. Dodge in Iowa--Fiscal agency, Boston; transfer offices, Boston and New York; Fremont, Elkhorn, & Missouri Valley company--John B. Alley, of Boston, John I. and D. C. Blair, of New Jersey, C. G. Mitch.e.l.l, of New York, and three Cedar Rapids men, directors (this is a part of the Sioux City & Pacific road); Winona & St. Peters company--Fiscal and transfer office, Wall street, New York; Burlington & Missouri River (in Nebraska)--Princ.i.p.al office, Boston; Sioux City & Pacific company--Directors: Oakes Ames, and six others, in the east, and G. M.

Dodge, of Iowa--Fiscal and transfer office, Boston; Missouri River, Fort Scott, & Gulf company--Fiscal and Transfer office, Boston; Central Pacific company--Fiscal offices, San Francisco and New York; [A]New Orleans, Mobile, & Texas company--Oakes Ames and twelve other directors, resident in New York and the east, and two in New Orleans; princ.i.p.al office, New York; Houston & Texas company--Fiscal agency and transfer office, New York; Chicago & Northern Pacific Air Line company--Princ.i.p.al office, New York; Elizabeth, Lexington, & Big Sandy company--Princ.i.p.al office, New York; Dubuque & Sioux City company--General offices, Dubuque, Iowa, and New York. [B]Texas and Pacific company--Princ.i.p.al office, New York.

[A] NOTE.--This company has a donation from the state of Louisiana of $3,000,000; a subscription of stock by the same state to the amount of $2,500,000; and the same state has indorsed the company's bonds to the amount of $12,500 per mile. This company has also received other large sums in munic.i.p.al aid and other donations.

[B] NOTE.--This company has a grant of 13,440,000 acres of land, and other aid.

We might continue the above list indefinitely, but think we have extended it sufficiently to sustain our charges. If the reader is desirous of learning who compose these various companies, the Railroad Manual will disclose the same set of leading men, divided into three or four princ.i.p.al squads or companies, who raid from one end of the country to the other; control all the roads that have received aid, and at once place them under the direction of the central railroad combinations in Boston and New York; diverting the grants and donations supposed to have been made for the benefit and in the interest of the people, to their own selfish purposes; making the aid thus granted a means of oppression to the people, rather than an agency for their relief.

CHAPTER XIV.

THE IMPOVERIs.h.i.+NG TRANSPORTATION SYSTEM.--THE WAREHOUSE CONSPIRACY.

One of the great evils resulting from this bonded subsidy system of building railroads, is that it gives to those who manage them the control of the whole carrying trade of the country, and enables them to impoverish the great agricultural population of the west and south. The wealth of the United States lies in its agricultural products. The greater portion of the people are engaged in agricultural pursuits. Good markets and cheap freights are of the utmost importance to agriculture.

However abundant may be the crops, unless a market can be reached without a sacrifice of one-half the product in the shape of freights and commissions the husbandman will be impoverished. If the farmers, the tillers of the soil, do not receive a fair remuneration for their work, all other industrial interests will suffer with them; anything that tends to deprive the producer of the value of his product, tends to the impoverishment of the whole country. Any system of laws, regulations, by government, or combinations of men, or corporations, that are oppressive to the producer, oppress the whole people. It matters not whether these oppressions are in taxes, tariffs, or charges for transportation of the farm product; no matter in what shape it comes, the result is the same.

The great oppression now being practiced upon the people is in the enormous charges made by railroad companies for carrying freight. The charters, grants, subsidies, and privileges given to these companies have enabled them to organize a powerful monopoly, through which they demand and receive for transporting meats, grains, and other farm products from the west to the eastern markets, at least one-half the value thereof. The charges of these monopolies are arbitrary, and often fixed by the value of the different kinds of grain carried by them. For instance, they charge one-third more per ton for carrying wheat from the west to the east than for corn and oats; it being worth more in market, they ask a larger dividend from it. It can be carried as cheaply as oats or corn, but, because of its value, will bear a greater charge, and still leave one-half of its value for the producer. There is no good reason why a railroad company should charge thirty cents per hundred for carrying wheat from Muscatine (Iowa) to Chicago, when it charges but twenty cents for carrying oats and corn over the same road, the same distance. Yet such is the fact. Those who are in the interest of these monopolists talk about cheap freights; they argue that railroads can transport freights much cheaper than it can be done over ordinary highways. Let us turn again to the Railroad Manual, and see how the matter is treated. Says the author: ”The cost of transporting Indian corn and wheat over ordinary highways will equal twenty cents per ton per mile. At such a rate, the former will bear transportation only 125 miles to a market where its value is equal to seventy-five cents per bushel; the latter only 250 miles when its value is $1.50 per bushel.

With such highways only, our most valuable cereals will have no commercial value outside of a circle having a _radii_ of 125 miles and 250 miles, respectively. Upon a railroad the cost of transportation equals one and one-fourth cents per ton per mile. With such a work, consequently, the circle within which corn and wheat, at the price named, will have a marketable value, will be drawn upon a _radii_ of 1,600 and 3,200 miles respectively. The arc of a circle with a _radius_ of 125 miles is 49,087 square miles; that of a circle drawn upon a _radius_ of 1,600 miles is about 160 times greater, or 8,042,406 square miles. Such a difference, enormous as it is, only measures the value of the new agencies employed in transportation, and the results achieved compared with the old.”

Here the fact is acknowledged that freights can be transported over railroads for one and one-fourth cents per ton per mile. At this rate, a ton of freight transported from Muscatine, Iowa, to Chicago, would cost less than $2.50. This is what the advocates of aid to railroad companies publish to the world as a fact, and from it deduce the argument in favor of increased facilities for their construction, with greater privileges to be granted to the companies constructing them. The same rate of charges for transportation from the state of Iowa to the city of New York would not amount to more than from twelve to fifteen dollars per ton, and would allow the producer a fair price for his product. But while it is admitted that the above stated amount will compensate the railroads for transporting freights, the amounts actually charged range from twenty-five to fifty dollars per ton from Iowa to Chicago, with a proportionate increase to New York and other eastern cities. Where commerce is open to compet.i.tion, a fair remunerative price for carrying freights is all that is demanded or paid. If the railroads of the country were not owned and controlled by the same combinations; if they in any degree answered the ends antic.i.p.ated by the public when their charters were granted and privileges were bestowed upon the companies constructing them, these excessive charges would not be made or paid.

We have attempted to show that all the railroads in the country are owned, controlled, and operated in the interest of eastern capitalists, with their headquarters in New York or Boston; and that the only interest these capitalists have in the producer is to extort from him all they can get, even at the risk of ruining the whole country. These monopolists, taking advantage of the great privileges granted them, and of the necessities of the agricultural and producing cla.s.ses, have combined, and defying all compet.i.tion, as well as the legal restrictions sought to be placed upon them, are now, and for some time past have been, charging such unjust rates for transportation as to render the farm products of the west of little or no value. Corn, worth from sixty to seventy cents in New York, is worth only from fifteen to twenty-five in Iowa--two-thirds of its eastern value being absorbed in charges for transportation, storage, &c. Wheat, worth from $1.50 to $2.00 in New York, is worth but from ninety cents to $1.25 in Iowa, the difference being absorbed in charges for transportation, storage, commissions, and in pa.s.sing it through elevators. It will be seen that these monopolists who have combined for that purpose are systematically robbing the farmer of about one-half of his crop. After he has labored diligently during the season, and harvested his crops and prepared them for market, because of the privileges granted to these monopolists he must divide with them, giving them one-half, or let it go to waste, and suffer his family to want for the necessaries of life. The combination against him is so perfect he is without remedy. All other means of transportation have been superseded by railroads, and he is powerless to resist. The banditti who raid upon the country, and levy tribute upon the inhabitants by force, are no greater robbers or oppressors than these monopolists. Indeed the wrongs practiced by the former are less to be dreaded than those practiced by the latter. The people, supported by natural and common law, as well as by statutes, can rid the country of the bandit; but the monopolist has become so powerful that he defies the people, moulds the statutes and decisions of courts to suit himself, and compels the whole country to submit to his extortions. No one would wish those engaged in transporting freights from the west to the east to lose money in the business. On the contrary, the people desire that railroad carriers should receive a fair and liberal compensation in their business, and upon the capital invested. But when it costs but $30,000 per mile to construct and stock the railroads, and when for the purpose of illegitimate gain the persons owning and controlling them water the stock, and add to the actual cost fict.i.tious and imaginary items, that it may appear that these roads have cost fifty or sixty thousand dollars per mile, then issue to themselves or their agents bonds to meet these fict.i.tious amounts, and annually pay to themselves the interest on these bonds, and to increase the value of these bonds declare dividends upon the whole stock, it will readily be seen why the producer does complain of the high rates now charged for transporting his products to market.

These companies make it impossible to do an honest business and show dividends, or ever pay the interest upon the bonds they have issued. If it be true that the charges for freights cannot be reduced on railroads, two things are demonstrated: First, that the published statements of the costs of carrying upon railroads are untrue; and second, that railroads have entirely failed to supply the necessities of the country. If we are to depend upon railroads to carry the agricultural products of the country to the seaboard, all hope of competing with other countries in European markets is at an end. If the cost of carrying a bushel of wheat from Iowa to New York is to remain as at present, one of two alternatives is presented. Either the producer must sell at ruinous rates, or a home market must be found for his crop; for the large amount charged for carrying it to the coast, added to the ocean freight, destroys all hope of a foreign market, save in times of failure of crops elsewhere. We now complain of our lack of s.h.i.+pping upon the ocean, and of the fact that the balance of trade is against us. With our large annual product of cereals, meats, cotton, and yield of precious metals, the balance of trade is in favor of England; and American s.h.i.+pping, once the equal of England's, is now cla.s.sed with only third and fourth rate nations. One of the chief causes of this deplorable state of affairs is the absolute control obtained by these petted monopolists over our inland commerce, and their tyrannical extortions in rates for transportation.

We have spoken of the rates of charges from the west to the east. We need not go into details in this matter, for every farmer knows from experience what proportion of his crop railroads demand as their share.

If he does not, let him look at his crib of corn, worth in New York from seventy-five cents to one dollar per bushel, and in Iowa from fifteen to twenty cents. Three-fourths of his crop is what these corporations, _these great blessings to the country_, as they claim to be, demand of him for carrying his one-fourth to market, provided he will, at his own proper cost, load his whole crop at the place of s.h.i.+pment, and unload it when it reaches its destination; or, what is worse for him, permit it to go into the company's storehouse. While this state of things lasts, it is not a question as to how much the producer is increasing in wealth, but how long will he be able to pay his taxes and keep his family from starving? If he is in debt, he is without hope of paying. No king, emperor, or despotic sultan, would dare to extort from his subjects three-fourths of the productions of their toil; yet this oligarchy, composed of men who, from long practice, have come to look upon the people as their va.s.sals, and the fruits of their labor as lawful spoils, demand and receive as their toll from one-half to three-fourths of the entire farm products of the country. The consolidation is now so perfect, that these railroad kings can dictate to the people how much they shall receive for their products, and how much they must pay for transporting it to market. Any one of the railroad kings of New York, by a telegraphic dispatch to the west, can depress the price of grain one, five, or ten, cents per bushel. The order is made at headquarters, and in one hour from the time it is made the farmer in the west who is about to sell his one thousand dollars' worth of wheat must take nine hundred dollars for it, because this railroad king has sent word west that he must have another one hundred dollars added to the already enormous charges for transportation. Unless this combination can be broken up and destroyed, and they who own, manage, and control the carrying trade of the country forced to act honestly, there is no prosperous future for the laboring and producing portion of the people; they must remain bond-servants and va.s.sals of this railroad oligarchy now controlling the country.

Another evil resulting from this railroad system, directly affecting the producer, is the elevator and warehouse system, put in operation, supported by, and prosecuted in the interest of, this monopoly. As a necessity in s.h.i.+pping and handling grain and other farm products, there must be at s.h.i.+pping points, as well as at the great grain depots, warehouses, storehouses, and elevators. If these were owned and controlled by individuals, unrestricted by railroad companies, they would be of great benefit to the producer; but such is not the fact. Go to any way-station on the roads, or to any of the more prominent points, as well as to the great grain depots, and you will find an arbitrary and oppressive rule adopted, which demands of the producer a further dividend from his products. At unimportant points and way-stations, the warehouses and elevators are built upon the company's depot grounds, and, if not owned by the company, are built under an agreement that there shall be a division of the receipts; and in order to make it mutual, the elevator company, or warehouseman is to charge certain rates on all grain pa.s.sing through their hands; and the railroad company is to receive on board their cars no grain that has not paid its duty to the elevator or storehouse. Whether it is stored or not, whether it pa.s.ses through the elevator or not, this arbitrary toll or levy must be paid before it can be s.h.i.+pped. If the farmer deliver it directly on board the cars of the company, he must pay these charges the same as though he had delivered it to the warehouseman. He cannot avoid this extortion, for the only possible way he has to get his grain to market is to s.h.i.+p it over the road, and this he cannot do unless he pays this charge. But by far the greatest imposition is practiced at the great grain depots at Chicago, New York, and other cities. The immense daily receipts at these great depots demand immense warehouse and elevator facilities. Large numbers of elevators and warehouses were provided and used--formerly by individuals; and while warehous.e.m.e.n dealt individually with the public, there was but little abuse; compet.i.tion was sufficient to insure reasonable charges. The owner of grain, upon its arrival at its destination, could avail himself of any compet.i.tion among warehous.e.m.e.n, and select such as his judgment approved or his interest prompted.

But a different rule now obtains. These railroads do not stop half way.

Their combination for carrying the product of the country is perfect; but another combination will afford them an opportunity for extorting from the producer an additional portion of his crop in the shape of storage. To effect this object, the different warehouse companies in the princ.i.p.al grain marts have consolidated or ”pooled” all their interests, and in combination with the railroad companies have pursued, and are pursuing, a course of extortion which is oppressive upon the producer.

When his grain reaches its destination, it must go into a warehouse; he is in a worse situation now than when he s.h.i.+pped it; then he had the option to keep it, or submit to the first levy in favor of the warehouseman; but he is now entirely helpless in the hands of the _ring_ formed to rob him. Without asking his consent his grain is taken to such warehouse as the railroad agent directs; it is seized by the warehous.e.m.e.n and stored at such ruinous rates as to compel him to sell at once, or have the small portion of the crop which he sowed and harvested, and which thus far the railroad combination has graciously allowed him to retain, absorbed by elevator and warehouse charges. He is obliged to use all these agencies or let the crop go to waste on his hands; and these agencies are all owned and controlled by this vast, this gigantic corporate power, created, enriched, and protected by state and national legislation, and constantly guarded by the decisions of the courts, state and national. Indeed, the old despotic maxim, ”The king can do no wrong,” that his acts cannot be questioned, seems to have descended to these monopolies. They are protected by government, and, as the case now stands, _their servants, the people_, must be content, because all hope of relief from efficient action on the part of either the legislative or judicial departments of the government is denied them.

CHAPTER XV.

A NEW AND FALSE PRINCIPLE IN HYDRAULICS--WATERED STOCK--ITS UNLAWFUL PROFITS THE SOURCE OF EXTORTIONATE TARIFFS--THE ”FAST DISPATCH” SWINDLE.

We have attempted to show some of the oppressions of the present railroad system upon the agricultural interests of the country, and, at the close of our last chapter, were treating of freights, warehouse charges, &c. Closely connected with these latter charges is another abusive and fraudulent practice, which threatens not only to still further oppress the people, but also to more closely combine the power now so rapidly and surely destroying our republic. I refer to what is known as ”Dispatch Companies.” To fully understand the object and effect of these companies it will be necessary to look a little further into the management of railroads, and the methods adopted in their balance sheets for showing the cost of their construction, the amounts of paid-up capital, and their total indebtedness. These balance sheets do not present the truth in any instance, and have not that purpose, being only an exhibit that will apparently justify the many extortions and deceptions practiced by these corporations. The actual cost of constructing and stocking the roads is not given; instead, we have the cost as represented by the stock and bonds issued and _watered_. For a clear understanding of this book-keeping, let us examine the cost of some of the roads as the same is given to the public, and compare it with the actual cost as shown by other evidence. The ”Central Pacific”

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