The Silver State

FRENCH'S CONTRADICTIONS.

Railroad Auditor French came to the Pacific Coast last Fall to inquire into the condition of the Central Pacific Railroad. He went back to Washington and represented the financial affairs of the Central Pacific Company as being in a condition to warrant the Government in bringing suit against the company for the payment of a certain percentage of its net earnings, in accordance with the provisions of the Funding Act. The Government instituted proceedings, but pending the trial of the case in the courts, French again visited the Pacific Coast. Some two or three weeks ago he returned to Washington and wrote a letter to Governor Stanford, President of the Central Pacific Railroad, in which he eulogized the management of the road, and stated that it could pay its indebtedness to the Government and pay a dividend of six per cent, besides from its net earnings. His recent statement left the Government no alternative but to abandon the suit brought against the railroad company, or go to trial with the certainty of losing it. Now it is reported that French's letter to Stanford has cost him his official position, and that he is to be removed for making such contradictory statements-first recommending a suit against the company, and then showing by figures that his report last Winter was false, and that the suit must be abandoned. It was evident to everybody but the Government officials that the Central Pacific Railroad had been doing a heavier business since last September than at any previous time since it was completed, yet French insisted that its carrying trade was being diverted to the Southern Pacific, which was not built by subsidies, to evade the payment of a percentage of its net earnings to the Government to meet the interest on the bonds issued for its construction, for the payment of which, both principal and interest, the Government is security.