Chapters on the History of the Southern PacificDaggett, Stuart
History
Chapters on the History of the Southern Pacific
Daggett, Stuart
Pacific railroads -- History; Railroads -- California -- History; Southern Pacific Company
In addition to the advances made by the Huntington group, the
construction companies benefited substantially by the assistance
rendered them by the Central Pacific. This was a sort of help which the
Central Pacific itself and the persons who built it had never known.
It took a variety of forms. A very obvious service which the Central
Pacific could and did offer was the operation of sections of the
Southern Pacific as fast as completed in connection with the Central
Pacific main line. Besides this, the Central Pacific acted as banker
when the construction companies had spare funds. More important still,
the Central Pacific on occasion lent considerable sums to the Western
Development Company. This was later denied by representatives of the
Central Pacific, but the evidence seems conclusive that the loans were
made.[186]
Similar advances were probably made by the Central Pacific to the
Pacific Improvement Company,[187] and to the Contract and Finance
Company, sometimes without interest. Money in the Central Pacific
sinking fund was invested in this way, at interest.[188] Like use
was made of surplus funds belonging to the Occidental and Oriental
Steamship Company, which the Central Pacific was holding, until the
Union Pacific discovered the matter, and, being interested in the
money, demanded that its share be handed over.[189] There is even
evidence that the associates borrowed money from the Central Pacific
between 1874 and 1878, and that the treasurer of the company entered
the sums taken on so-called “cash-tags,” carrying them as cash in his
accounts.[190] How much all these transactions amounted to, it is very
difficult to say, but it is probable that the aggregate was large.
Profits of Associates
Public-domain text, read in full here on John Shaqi.
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