NP, NOTP 4/9/1861

From the New Orleans Times Picayune
 
April 9, 1861
 
Southern Pacific Railroad
   When the Illinois Central Railroad Company was incorporated with a donation of six sections of land to the mile, it was regarded, and justly regarded, as one of the most magnificent speculations of the day. It is true, that when the grant was made, the lands could not be sold for the Government price of $1.25 per acre, but the far-seeing sagacious minds of those interested in the project saw clearly that with a railroad running through the heart of a productive State like that of Illinois, these lands were destined to increase in value, while the railroad itself would be a source of immense profit. The result exceeded their expectations. One million acres of these lands sold for $17 per acre, realizing to the stockholders seventeen millions of dollars.
   Now, let us contrast this scheme with that of the Southern Pacific Railroad.
   1. The latter company, instead of six, is entitled to a donation of sixteen sections of land to the mile. In other words, the grant to the Illinois Central was 3,840 acres to the mile; while that of the Southern Pacific is 10,240 acres to the mile.
   2. The Illinois Central runs through a State intersected by a number of valuable navigable streams; and as water navigation is cheaper than railroads, the effect must be to take a great deal of business from the road. The Southern Pacific, on the contrary, does not encounter a single navigable stream, worthy of the name, from the Louisiana boundary to El Paso, and must necessarily command the carrying trade on either side of the road for hundreds of miles.
   3. The Illinois Central passes through a country requiring a heavy grade. The cost has been immense. It is safe to assume that the grading on the Southern Pacific will not cost half as much, and perhaps not more than a third of that road.
   4. Look at the difference in the climate. There are seasons of the year when the Illinois Road is obstructed by ice and snow. The winters are of such severity as to seriously affect travel. The climate in Texas is just the reverse. There is not a day in the year when there will be slightest interruption of the business of the Southern Pacific Road.
   5. The Texas lands produce wheat and corn in great abundance, and from the character of the climate, it must be recognized as the best cattle country in the world. The wheat crop is harvested in May, which will enable the Texas farmers, by the assistance of this railroad, to get their flour into market six weeks earlier than that of Illinois. The cereals not only thrive in this latitude, but this section embraces also the richest cotton lands in the world. And such is the value of this cotton district, that it may be affirmed with truth, of which any one may be satisfied by examining a map of the country, that taking an area of one hundred miles on either side of the road, it is capable of producing more cotton than is now raised in the United States.
   6. The business upon the Southern Pacific is destined to far exceed that of the Illinois Central. The former, while it will have the exclusive carrying trade of an immense district of country, will, if successfully prosecuted, be the great thoroughfare to the Pacific, and when finished, possess the carrying trade of California, Australia, Japan, and China.
   In view of these undeniable facts, why is it that the Southern Pacific is not destined to be a much for lucrative enterprise than that of the Illinois Central? Are not the lands far more valuable? Will not the road, when finished be a better paying investment of capital? These questions require no answer. The plain, common sense of every intelligent man will respond at once, that the Southern Pacific is so far ahead of the Illinois Central, that there is really no comparison.
   These propositions being established, let us look at the respective value of the grants to the Illinois and Texas rods.
   The Illinois Central, for 800 miles of road, receives 3,092,000 acres; the Southern Pacific 8,192,000. The difference in favor of the latter amounts to 5,100,000 acres. If the two companies were to sell their lands at $17 per acre, the price obtained for 1,000,000 of the Illinois lands, the result would be as follows: The Southern Pacific grant would realize $139,264,000; that of the Illinois $52,564.000 -- difference in favor of the former, $76,700,000.
   But without entering into any comparison of the value of the two grants, is it not reasonable to assume that the Texas lands will ultimately sell for at least $10 an acre? Is it not much more likely that they will realize $20, $25 and $30 per acre? But estimating that they are sold at $10 an acre, and the mind can be hardly made to realize the vastness of the sum. In amounts, in gross, to $81,192,000! At $30,000 per mile, 800 miles of road would cost $24,000,000. The stockholders, therefore, can pay for the entire road and realize, in addition, upwards of $57,000,000.
   In whatever aspect this enterprise is view, it must be regarded as the most magnificent project ever presented in the world's history. Three dollars per acre will pay for the work, and if the stockholders obtain this -- 800 miles or railroad -- without costing them a dollar, surely there is enough in it to tempt the cupidity of all men who have money to invest in railroads. And when we consider that the amount of stock necessary to complete this enterprise, will be, probably, not more than four, and will certainly not exceed five millions of dollars, some idea may be formed of the magnificence of the scheme.
   But it may be asked, if all this be true, why is it that the road has not advanced more rapidly? For the reason, first, that the stockholders are so numerous and so widely scattered that they cannot be reached; and secondly, they have no seemed to properly appreciate the value of the enterprise. If the charter had been in the hands of a few men of capital and enterprise, it is not unreasonable to suppose that two hundred miles of road would have been constructed ere this, and the stock today would be the most valuable in the world. All that is required now is a purchase of new stock at the rate of one dollar a share on stock now held, which is not a payment or a donation, but a sum for which the stockholder gets a fair equivalent in the stock of the company. There are 400,000 shares of stock, which, if all represented by this call, will amount to $400,000. The whole of this sum is required to py the debts of the company and to finish the fifty miles of road, and if furnished promptly would run the stock up in a few months to $10 a share. But while most of the stockholders are responding to the call, there are many who are holding back. What must be the inevitable result of their course if continued? At best the prospects of the enterprise must languish, ending probably with the sale of the franchise and property under execution. The debts are now due; many of them are in judgments. A day's delay may be fatal. Why, then, does not every individual stockholder come forward immediately and lend his aid in this emergency? They hazard nothing in doing so; for, if through the negligence of some and the ignorance and obstinacy of others, the property has to be sold, a powerful company will be formed to purchase it, and all those who have stood up in the day of trial will be protected. It is desired that the road shall not be sold, and that every stockholder shall continue to hold his enterprise. Hence these frequent and earnest appeals.
   Will the stockholders be true to themselves and their own interests? If not, and the road is sold, and this splendid speculation passes from them forever, they certainly can attach no blame to the managers of the company, nor to that portion of the press which has favored this enterprise. Argument and persuasion have been exhausted, but, we trust, not in vain. We entertain the confident hope, amounting almost to an assurance, that the stockholders will do their duty, and their full duty, by advancing the necessary aid to render this enterprise a splendid success.
   With these remarks, we would refer the reader to the card of Col. R. V. Richardson, who publishes an exhibit of the condition of the company, with a proposition to sell five hundred thousand dollars of new stock. He estimates the length of the road at 900 miles, to which it will doubtless approximate, when the side tracks, &c., are taken into the account. This, while it increases the extent of the road, also enlarges the bonus in land, thereby increasing the profit of the investment over our estimate.

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