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About The Conservative (Nebraska City, Neb.) 1898-1902 | View Entire Issue (Jan. 4, 1900)
" Conservative * corned , the grants represent a vnlno of 1498,607.208 * * * and if to this is added the milengo of the southern land grant roads * * * the laud dona tion would represent in value about $500,000,000. " This estimate seems to bo much wider of the mark than your statement of the total acreage. The figures indicating at what prices sales of these lands have been made , are ad mittedly incomplete and imperfect. Such as are at command , include in terest and do not tnko into account the cost of disposiug of the lands , which has been very largo , nor expenditures for taxes , deduction from mail pay , and many other items necessary to a correct statement. These sale prices , moreover , are not a fair nor proper criterion of the value of the grants. They represent values which the rail roads have themselves created , in largo measure , and not values which the government surrendered. In the June , 1898 , number of the "Journal of Political " Economy , pub lished by the University of Chicago , is an able review by Mr. "W. H. Allen , of the value to the state of the charter tax of seven per cent , upon gross earnings , imposed upon the Illinois Central com pany , as one of the conditions of its laud grant. This discussion is not from the railroad standpoint , in any sense. Mr. Allen said : "In determin ing the principle represented by the lauds , wo must take account of the ac tual value of the lauds in 1851. The values which the railroad compauy waste to receive for the lauds were not fore seen , and the state could justly claim compensation ouly for the values it surrendered. The lands had been of fered by the general government at $1.35 per acre , without finding buyers , but as soon as the lauds were granted to the railroad company , the miuimum price for government as well as rail road lauds became $2 50. More than this they were sure to bring , but only in case the private corporation bring in the road to develop them. That is , from the standpoint of the state in 1851 , $3 50 per acre would have been an out side figure. " The method suggested in your article for arriving at value of million of acres from "basis of last sales , " or "the prices at which the company is holding its lauds or "sales recently reported , " etc. , etc. , are certainly not acceptable. While in Iowa , Illinois , Minnesota and other states , the grants covered some lauds which were of the best quality , it is a well known fact that the grants of large area , notably those of the Northern Pacific , Central Pacific , Texas & Pacific , Atlantic & Pacific , and virtually all the southern grants , em braced millions of acres that have no pecuniary value. They are simply bar ren wastes of desert or swamp. They can never be sold for enough to repay taxes and ihe expenses of survey and sale. In an address in 1893 , before a congressional committee , resisting an attempt to further reduce the mail pay of land grant roads , Hon. E. B. Stahl- man , representing the Southern Rail way and Steamship Association , said : "Tho laud granted in Alabama con sisted of hills and mountains , not sus ceptible of cultivation. The Florida lands wore sand hills , thinly covered with small pine of little value. Of those , the best have been sold at 70 cents per aero. The companies cannot realize 25 cents per acre on what remains un sold. "When the grants were made , their value could not have exceeded cents per acre. Lauds of greater value were sold all through Florida and Ala bama for that price. " More than eleven million acres have been patented to railroads in the southern states and an estimated average value when grant ed of 40 cents per acre seems large. Your article states that the grant to the St. Louis & San Francisco Compauy was 1,860,586 acres. The grant was in fact for 1,668,000 acres in Missouri , and concerning its value , the laud com missioner says : "Fifty per cent of this grant was wholly worthless ; 80 per cent was fairami similar lauds sold for 25 euts per acre ; the remaining 20 per ent were worth one dollar per acre. " Concerning the Atlantic & Pacific grant your article says : "This land rant is reported as having sold at an average of $5.50 per acre , " and you have estimated the whole at $8.00 per acre , or $75,725,960. The vice president of that company says : "The company sold 8,500,000 acres at 75 cents per acre , 1,058,560 acres at 50 cents per aero to a cattle company , and 259,000 acres at 70 cents per aero , an average of 87 cents per acre , or $4,670,000. The taxes and expense of selling the lands to date have been $622,000 , the mail pay de ductions $480,000 and large deductions on account of transportation of troops and munitions of war. The company would be glad to sell all the land it now owns or will receive at 25 cents per acre. There is no demand for it and the truth is , it cannot be sold for any sum. " Taking the largest view possible for this grant , 5,000.000 is a liberal estimate of its entire value , or less than one- fifteenth the amount stated in your article. It is within my personal knowledge that in southwestern Iowa , which is to day one of the finest farming regions in the world , as late as 1860 , and five years after the grant was made , lands of the best character were freely bought at 70 cents per acre , from settlers who had paid the government $1.25. The railroad was not yet built , there was no market , and the lands had little value. These figures are given , not because the selling prices furnish a criterion for determining the value surrendered by B-r the government to the companies , but for the purpose of suggesting that any general estimate of value seems worth less , which does not undertake to classify the lands and make a dis- tincton between the good and the poor lands. In the states of Illinois , Iowa , Minnesota seta , Wisconsin , Michigan , North M I Dakota , Missouri and California , there wore granted in round numbers , about 40,000,000 acres , and a liberal estimate of their value surrendered by the govern ment , that is , when granted , even'if estimated upon speculative grounds , I1 would be two dollars per acre. An es- , timate of 40 cents per aero for the re maining 50,000,000 acres is believed to bo large. The railroad land grants of the United States , therefore , instead of amounting to 150,000,000 acres worth $500,000,000 , ad stated in your article , do not probably exceed , in fact , 90,000,000 acres , of the extreme value of $100,000,000. Regarded as a contribution towards the cost of building the roads as they exist today , this amount seems almost insignificant. The cost of the railroads in the present Burlington system was much over $250,000,000. There are 10 laud grant roads , whose aggregate cost amouuts to more than $3,000,000,000. Some Burdens Attached to T.und Grunts. If the view is acceptable that in stat ing the worth of the grants , the values surrendered by the government should be made the test , then the question of burdens in the way of taxes , expense of selling and similar items diminishing the proceeds from sales , is not material. The amount , however , of other burdens is much larger than is generally sup posed. As Mr. Fish has recalled to mind , the Illinois Central company has already paid into the state treasury nearly $18,000,000 , being the annual tax of seven per cent upon gross earn ings imposed upon that company as a condition of the grant. This is iu lieu of all other taxes , and as the ordinary levies would amount to about half that sum , it is proper to say that the com pany has repaid the state $9,000,000 in cash on account of its land grant. This payment is to continue perpetually in an increasing ratio , if business in creases , and now averages $642,000 yearly. There appears to be no reason why the Illinois Central company might not , iu 1850 , have purchased from the govern ment every acre of this land at the open price of $1.25 per acre , that is , for the sum of $3,250,000. It has already paid $9,000,000 in one item and must continue to pay for all time to come. Who made the better bargain in that case ? , In the year 1876 , there was inserted l at the instance of Mr. Holman , of Indiana , into the post-office appropria tion bill , a most unjust proviso , that u *
