Huntington

sell it, when the Central Pacific was completed,
upon what he regarded as reasonable terms. It
is credibly reported that eighty per cent, of the
stock of the Central Pacific was offered to D. O.
Mills, as late as 1873, for a price of $20,000,000,
and this was probably the last of several unsuc-
cessful offers made to different parties. Since he
could not sell the Central Pacific system, Hunt-
ington was forced to operate it in order to earn
dividends and to give value to the Central Pa-
cific stock in which his construction profits were
expressed. It is probable also that opportuni-
ties for power and profit in railroading were be-
ginning to be apparent to Huntington's eyes, and
that he had begun to feel the creator's pride in
the Central Pacific-Southern Pacific organiza-
tion which he retained until the end of his life.
Partly, therefore, by accident and partly by con-
scious plan he remained in railroad work.

Until April 1890, Stanford remained presi-
dent, first of the Central Pacific and then of the
Southern Pacific Company. Huntington was
agent and attorney for the Southern Pacific
Railroad, vice-president and general agent for
the Central Pacific Railroad, first vice-president
of the Southern Pacific Company, and member
of the boards of directors of the two last-named
organizations. His offices were in New York,
though it was his custom to make at least one
visit of inspection west each year. Among his
financial duties he had the task of arranging for
the sale of company stocks and bonds and of bor-
rowing from the banks. The burden of this re-
sponsibility was particularly heavy during the
decade from 1870 to 1880, while the construction
of Southern Pacific mileage was causing a steady
drain upon the resources of the system. If the
new lines had been immediately profitable they
could have been more easily financed, but they
were being built for strategic and political rea-
sons rather than because of anticipated earning
power, and their effect was to cause the average
earnings of the system per mile steadily to de-
cline, Nor was there, as late as 1879, a market
in New York for system securities except for
Central Pacific first mortgage bonds. For sev-
eral years, therefore, Huntington's ingenuity
was taxed to keep the credit of his companies in-
tact, and it was not until after 1880 that condi-
tions sensibly improved.

At the same time that Huntington was busy
wrestling with the financial problems of a newly
completed railroad in undeveloped western ter-
ritory, he undertook to represent his company
at Washington in opposition to legislation which
it considered detrimental to its interests. The
bffls wMd* Huntington opposed between 1870

Huntington

and 1878 covered a wide range, but the most im-
portant were those providing for government
aid to the Texas & Pacific Railway, and those
relating to the ultimate repayment of the gov-
ernment advances to the Pacific railroad com-
panies under the acts of 1862 and 1864. The
Texas & Pacific project, energetically advocated
by Thomas A. Scott [#.£>.], contemplated a gov-
ernment guarantee of interest on that company's
construction bonds. Huntington fought the
guarantee, because it seemed likely to create a
rival transcontinental system over the southern
route, and Scott failed to procure it. Doubtless
Huntington's objections were not the only, and
perhaps not even the principal, reasons which
led Congress to refuse to assist the Texas & Pa-
cific at this time, but it may be assumed that
they contributed to the result. The most impor-
tant legislation relating to the Pacific railroad
debt with which Huntington was concerned was
that which finally became law as the Thurman
Act of 1878. The main purpose of this was to
compel the Pacific railroad companies to in-
crease their annual payments into a sinking fund
for the eventual retirement of the thirty-year
government bonds lent to these companies in aid
of their construction. The law was undoubtedly
defective, if only because it did not cause the re-
sources of the sinking funds to increase as rap-
idly as was hoped; but the companies opposed it
principally because they felt that they should not
be compelled to repay the government advances
at the end of thirty or of any other number of
years. From their point of view the indebted-
ness of the companies to the government was
offset by their equitable claims upon the govern-
ment, totaling far more than the principal of the
debt. Huntington shared this view and vigor-
ously opposed all compulsory sinking-fund legis-
lation, although without success.

It happens that Huntington's legislative ac-
tivities at Washington between 1870 and 1880
were brought to general attention by the publi-
cation, some time later, of a large number of let-
ters which he wrote during this period to a
friend and associate in Southern Pacific affairs
then resident in the West This was David D.
Colton, "financial director" of the Central Pa-
cific Railroad, and co-associate with Hunting-
ton, Hopkins, Stanford, and Crocker, though
possessed of only a minor interest in their prop-
erties. Huntington wrote Colton frequently and
freely, keeping him informed with respect to the
legislative situation at Washington, offering
suggestions as to company management, and
making pungent comments upon men and upon
affairs. Colton died suddenly in October 1878.

410