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and thus to have the means of doing something thoroughly, would have met with opposition from the people on easily understood grounds.

I will now pass to the consideration of the last point raised by me at the commence. ment of this article, namely, that can be done in the way of correcting the defects which hare been shown to exist in the system thus far pursued in this country in the collection of mining statistics?

In the first place, I candidly admit that we cannot have as perfect a series of reports of our mining progress as European nations possess, and for reasons which need but little explanation. The elaborate systems adopted in Europe have grown up in a long series of years with the government and the people. The latter are accustomed to be guided and inspected and to have their affairs closely inquired into by the government. It is not so here. I do not think that any amount of legislation on the part of Congress, even supposing such legislation to be practicable and constitutional, would succeed in giving us, even with an unlimited expenditure, an accurate statement of what is being done in our country in the way of mining and smelting; and when I say “accurate," I mean accurate like the Prussian or the French official mining statistics. To accomplish this it would be necessary that every mining locality should be subjected to constant vigilant inspection, on the part of the government, by scientifically educated and honest men, and that the people should be accustomed to such inspection, and willing to co-operate with the government in making it effective. It is clearly of my opinion that this is entirely impracticable; neither the character of our people, nor the nature of our government, nor the traditions of the past admit of its being done.

What, then, can be effected ? In the first place, I agree entirely with the Superintendent of the Census of 1870 in the idea that what is done must be by erperts in this department, and that mining statistics collected by the marshals in the ordinary way are of no value. I would even go further, and say that they are positively misleading and worse than useless, so that were the question to be asked whether the collection of mining statistics by the census authorities should be dropped altogether rather than follow the system hitherto pursued, I would unhesitatingly answer, Let the mining statistics disappear from the census, even if they cost nothing, rather than persist in the old methods of collecting them. I do believe, however, that it would be disgraceful to the country not to have any official reports on the progress of mining industry,

And I see no other way in which to secure at least a decennial representation of the levelopment of our mineral resources than to follow, in the main, the system pursued by me in the collection of the statistics for the “Metallic Wealth of the United States," a copy of which work is furnished herewith for your examination. Let some man, whose character for integrity is beyond suspicion, be placed in charge of the Department of Mining Statistics, and let him visit sucli districts as his time may allow, sending assistants to other districts, to collect material to be elaborated into one work, the object of which should be to set forth as clearly and concisely as possible the actual condition of the development of our mining districts, giving such statistics as may be obtainable, with estimates where moderately accurate statistics are wanting, and with full particulars as to how these statistics have been obtained, so that their comparative value may be judged of by the person using the material thus collected.

The assistants thus appointed must themselves be experts, and such should be preferred as have already some acquaintance with the regions they are to report upon. It need hardly be adıled that they must in all cases be men of scientitie education, who have absolutely no pecuniary interest in the region they have under their charge. I am aware that there will be difficulties in the way of finding men suited to hold such positions; and one of the difficulties will be that the salaries likely to be offered will not be high enough to induce men of ability to accept such appointments.

The number of persons to be employed in such a work as is here contemplated must depend on the amount appropriated, and on the length of time over which the investigation is to be extended. It seems to me hardly worth while to enter into detailed! estimates of the amount of money required, and statements of what could be therewith effected, until there is some assurance that the ideas here thrown out would be adopted as the basis on which the work is to be established. It does seem to me, after much consideration of the subject, that it would be possible for the Census Bureau to present once in ten years a l'ésumé of our mining operations for the previous decade which should be a volume of very great interest and value. But I candidly admit that the enterprise is a difficult one, and that it demands for its success that the person placed in charge of the work should be a man of energy, possessing both practical and scientific knowledge of economical geology; and, above all, that he should be one who could not be bought at any price.

In closing this communication, I woulil ask indulgence for its imperfections. To thoroughly work up the subject would require more time than I have at present at my command. I also desire to be excused for having put myself and my own work rather prominently forward in this connection, and also for having placed myself in the attitude of one finding fault with the work superintended by the gentleman to

whom this communication is addressed. These difficulties will be got over by your kindly considering this as a private communication made to yourself in the interest of science only. But, at the same time, I authorize you to use it as you may see fit, asking only that you should return it to me in case you find that it does not meet your views, and that, in consequence, it is of no value to you. I am, sir, with high respect, your obedient servant,

J. D. WHITNEY. General FRANCIS A. WALKER.

REPORT

OF

THE AUDITOR OF RAILROAD ACCOUNTS.

DEPARTMENT OF THE INTERIOR,
OFFICE OF AUDITOR OF RAILROAD ACCOUNTS,

Washington, D. C., November 1, 1878. SIR: Section 3 of the act of Congress entitled "An act to create an Auditor of Railroad Accounts, and for other purposes," approved June 19, 1878 (chap. 316, p. 169, 2 U. S. Stats., 1877–78), provides that it shall be the duty of said Auditor 6 to make an annual report to the Secretary of the Interior, on the first day of November, on the condition of each of said railroad companies, their road, accounts, and affairs, for the fiscal year ending June thirtieth immediately preceding.

In compliance with the above requirement of law, I have the honor to submit the following report in regard to the bureau and its operations since its organization on July 1, 1878, and of the affairs of such of the railroad companies as have complied with the requests of this office under the law, or as have rendered reports of any kind.

ESTABLISHMENT OF THE BUREAU.

In making this the first annual report of the bureau it may not be considered out of place to trace the course of events which seem to have led to its establishment.

In the annual report of the Secretary of the Interior for the fiscal year which ended June 30, 1877, after enumerating many particulars wherein improvement was required in the system of accountability of the Pacific railroad companies and in the reports made by them to the department, you were pleased to use the following language: “For the supervising of the accounts of these railroads, the government directors recommend that a special bureau be established in this department. With this recommendation I fully concur.”

The government directors of the Union Pacific Railroad Company, in their report to the Secretary of the Interior for the year ending June 30, 1877, alluding to the subject of reports, expressed themselves as follows:

The law requires certain reports to be made by the company to the government, but has provided no means for the utilization of the reports when made, and the same defect exists as to the reports of the government directors. If the present relations existing between the government and the company are to continue, some remedy should be devised for the defeet mentioned. All matters relating to the connection of the government with all of the railroad companies that have received United States bonds in aid of the construction of their respective roads ought to be organized in a special bureau in the Interior Department, in charge of a competent and responsible head. The government directors are aware that the present Secretary of the Interior has considered this definite subject, and probably has arrived at, or doubtless will arrive at, a wise conclusion in general and in detail, and here the subject may be safely left. The government directors can but express satisfaction with the fact that special thonght is now given to this important subject. The interests involved are very great, far more so than many others which have been accorded special snpervision since the foundation of the government.

The act of Congress approved May 7, 1878 (chap. 96, p. 56, Statute II, 1877–78), entitled "An act to alter and amend the act entitled “An act to aid in the construction of a railroad and telegraph line from the Missouri River to the Pacific Ocean, and to secure to the government the use of the same for postal, military, and other purposes,' approved July first, eighteen hundred and sixty-two, and also to alter and amend the act of Congress approved July second, eighteen hundred and sixty-four, in amendment of said first-named act," requires that the net earnings mentioned in said act of eighteen hundred and sixty-two, of said railroad companies, respectively"_the Central Pacific Railroad Company of California and the Union Pacific Railroad Company_shall be ascertained by deducting from the gross amount of their earnings, respectively, the necessary expenses actually paid within the year, in operating the same and keeping the same in a state of repair, and also the sum paid by them, respectively, within the year, in discharge of interest on their first-mortgage bonds."

To enable this and other provisions of the act to be carried into effect, it was necessary that some officer of the government should be specially charged with the duty of examining the books and accounts of the railroad companies, and of seeeng that the law was enforced.

While these recommendations and considerations were more immediately effective in the establishment of this bureau, the following brief review of legislation and events tends to show that the whole system of reports, State and national, is in a measure a necessary outgrowth of the railroad development of the country, and of the liability to abuse of the vast power invested in the control of such extensive interests.

Prior to 1862, the Congress of the United States had granted millions of acres of the public lands to many of the States, as well as the right of way, depot-grounds, and material from adjacent land, to aid in the construction of railroads; but neither money nor bonds of the United States were issued or loaned to railroad companies for the purpose of aiding in the construction of their roads until authorized by the act of Congress approved July 1, 1862, whereby the Union Pacific Railroad Company was incorporated. The grants of land made to several of the States, before and after that time, were subject to certain conditions to be performed by the railroad companies as to the time of completion of the railroads named in the acts, as to the use of the roads by the govern. ment, as to the compensation to be paid by the government for transportation of mails, troops, and supplies, and as to other matters, without any uniformity in the legislation, or provision for carrying the laws into effect.

The act of Congress approved July 1, 1862 (U. S. Stat. at L., p. 489), by which the Union Pacific Railroad Company was chartered, and that and other railroad companies named therein received loans of money and bonds of the United States, and grants of land, to aid in the construction of their respective railroads, and valuable franchises, provided that certain annual reports should be made to the Secretary of the Treasury; but as the act did not clearly designate or specify in many respects what was to be reported, and did not attach any penalty for non-compli. ance on the part of the railroad companies, it is not unreasonable to infer that such provision was intended to be temporary, to be operative only during the period of construction, and to be altered or amended, under the power reserved in section eighteen of the act, as time, experience, the increase of business, the safety of transportation, and the security of it at all times to the government, the obligations and finan

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