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NEBRASKA STATE HISTORICAL SOCIETY.

   He died upon October 6, 1905.
   A fitting eulogy was pronounced in an editorial of the Omaha Bee, as follows:
   "The death of former Lieutenant-Governor H. H. Shedd signalized the removal of another eminent Nebraskan who was for many years conspicuous in public fife. (And after a summary of his career) His life was an example of conscientious devotion to duty, which must have been a greater satisfaction to him than would have been the accumulation of colossal wealth."


RAILROAD TAXATION IN NEBRASKA.

ADDRESS BEFORE THE NEBRASKA STATE HISTORICAL SOCIETY
ON THE EVENING OF JANUARY IS, 1906.

BY HON. NORRIS BROWN. ATTORNEY GENERAL OF NEBRASKA.

Ladies and Gentlemen:

   The right of the state to tax railroads at all is obtained from the same authority that the right to tax other property is. Under the Constitution of Nebraska. every item of property within its boundaries is subject to taxation except that which is used exclusively for church, charitable, and educational purposes. The warrant for that authority is found in the 9th clause of the Constitution, and one feature of that I would like to call your attention to specifically, and, for fear I may misquote it, permit me to read it to you:
   "The legislature shall provide such revenue as may be needed by levying a tax by valuation so that every person and every corporation shall pay it tax in proportion to the value of his, or her, or its property and franchise, the value to be ascertained in such manner as the legislature shall direct."
   It is clear to start with that the property, whether it is physical - in sight, or whether it is tangible - out of sight, is taxable, assessed according to its valuation.



RAILROAD TAXATION IN NEBRASKA.

175

   Under the second proposition it is equally clear that the value shall be ascertained in the method provided by the legislature. Now those two propositions, I take it, are settled by the Constitution. In obedience to that authority the legislature when it first met in this state passed it revenue law. For the purposes of this discussion it is sufficient to call your attention to the fact that in the year 1903 the legislature wiped it off the statute book from the first to the last section, and in its place they put what is now known as the new revenue act. It was an act not to tax part of the property in this state, but an act to tax all of the property in this, state - personal, real, tangible, and intangible. It also provided a detailed list by which the assessor became an inquisitor. It was his duty to put on paper and get the signature of the man who owned the property, every item of the property, whether little or big item. The attempt of this new law was the purpose, which is well known by everybody, of the legislature to raise more money for the state. This was the purpose of it. And you could not raise more money for the state unless you increased the taxes in the state, could you? That was the purpose of the act. And the reason for that purpose was that under the old law it was not only full of inequalities and iniquities, but it didn't raise enough money to pay the expenses of the government. And it didn't matter much which party was running the government; the government was running behind every year under the old law. That was the object of the new law - to increase the taxes. Now to observe generally that that law was partially successful, is the fact that the total assessment roll of this state, under the old revenue act, had never exceeded $180,000,000. All property - railroads and common folks, all of it - never had exceeded the sum of $180,000,000. Railroad property in the state had never been taxed to exceed $26,000,000; that was the sum and the highest mark it ever reached. Under the new law the assessment roll increased to almost $300.000,000, and the railroads from $26,000,000 to about $46,000,000 in round numbers. That gives



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us an idea of these two laws as to their operation and also a comparison of the corporation property. with other property.
   I am here to discuss particularly railroad taxation in this state and under this law. This law undertook to provide the method, as the Constitution provided, by which you might ascertain the valuation of the railroad for taxation purposes. My good friend, the professor [E. A. Ross], has told you about the difficulties that confront any assessor undertaking to assess a railroad. You must remember that the railroad doesn't just lie within our state; it passes through many states. It therefore becomes the duty of the assessor in this state to find the valuation, not of the entire railroad, but just of a piece of it, just a part of it. Those difficulties the legislature undertook to minimize, to reduce to the lowest possible degree, and to do that they went to great length in declaring the method by which the state board of equalization and assessment might investigate that question. I want to talk to you a little while about that method.
   In the first place, that law said that every railroad corporation doing business in this state should make a return to the state board of all of its property, its physical property nothing about its stocks and bonds - but its physical property; its miles of right of way; its depots, their cost; its bridges, their cost; its trackage; every item of physical property that it owned in the state must be returned to the state board, and that the value of that physical property should be returned to the state board and sworn to by the agent of the railroad making the return. Now, my friend discusses quite clearly how insufficient and unsatisfactory that method would be, to assess it at that rate; just take the physical property at what it is returned and assess it. That would be unfair. Let its apply the test to a railroad system in this state. Here is a railroad that has a thousand miles within Nebraska, in round numbers. The total system has 3,000 miles operating in several different states. They make a return of their cars and physical property in Nebraska, and the officer swears that it is worth on an average $20,000 a mile, making the re-



RAILROAD TAXATION IN NEBRASKA.

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turn that is sworn to. The legislature that passed the law thought that that would not be a safe test upon which to base the taxation of a railroad, and they provided that the value of its physical property as returned by the railroad agent should not bind the state board making the assessment, and yet that was one of the tests the law did provide the board must examine. Under the law the state board had followed the injunction of the law and applied that test, that is, they had examined these returns and found that they were worth $20,000 a mile as returned by a statement, - and this of a railroad that you could not buy in the markets of the world for $60,000 a mile. Do you know of anybody whom you are satisfied is fair, that would argue that a railroad should be assessed, then, according to its physical property? in Nebraska, under this law, it can not be assessed by the physical test alone. Why? Because this same act provides further on that the railroad must make an additional and further return to the state board. It provides what that return and the schedules shall contain. And what is it? The total capital stock issued by the corporation. What else? The market value of that capital stock. What else? The dividend that has been paid by that corporation on its stock during the preceding year. What else? The total issue or its bonded indebtedness outstanding against the corporation, and its value and rate of interest, and whether paid or not. Now we have a second test provided for here by the legislature under this provision of the Constitution that authorizes it; a test; that permits the assessing board to investigate the stock and bond values that my friend talked to you about. He said that was an unsatisfactory test, in a measure. I agree with him, in a measure. Any test is unsatisfactory that undertakes to fix the valuation of a corporation that is doing a business in a number of states when you can not fully, exactly, and accurately fix a value on that part of the system in this state. But let me tell you, the courts of this country have been dealing as often as legislatures have with the question of how to tax railroads, and the courts in this country, ever since 1875,
     12



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when Chief Justice Miller laid down the rule that no fairer method has ever been devised by the legislature to fix the value of a railroad than to find the value of its stocks and bonds, and from them to ascertain the value of a part of the system, have sustained the Title. Why is it fair? Because when you buy the stocks and bonds of a railroad you have bought all the railroad. You haven't bought anything else. And when you own the stocks and. bonds of a road you own it all, every mile of it, every car, every asset that it holds, whether assessed in connection with the company or something else, you are the owner of that railroad system, depots and all. The difficulty with the stock and bond test, and the reason why it is unsatisfactory is this, that you can not find out what the value of the stocks is. That is the trouble. It is easy to find the value of a bond because it has a reasonably staple value on the market. But when you come to the value of the stock which is issued whenever the directors make up their minds they want more stock outstanding, that is a different proposition, because it is subject to manipulation sometimes. But who manipulates it? The fellow who owns it, and the fellow who knows what it is worth. The fellow who has to pay the taxes on it. The fellow who is dealing in those, kinds of securities, he is the fellow who manipulates it. And if he does it to his own disadvantage he can not complain of the assessing board, because it is his act, and not the act of the assessor. But the board is not bound by any market value anyhow.
   It is the duty of the board under the second provision to investigate and ascertain the actual value of the storks and bonds, and it is the duty of the company to return actual value if it knows it, as well as the market value. In this state in 1904 there were returns made of a railroad operating in eleven states that had outstanding $208,000,000 of stock, who swore to the state board of this state that they did not know what their capital stock was worth. It did not have any market value because its owners had taken it off the market. It was not quoted since 1901. Now it had no market value. They swore under oath that they did not know what it was



RAILROAD TAXATION IN NEBRASKA.

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actually worth. That left the board up in the air. Left them to resort to some other means of investigation, which they did, to find out what the value of that stock was. But now then, let us carry this application of this principle to the road that I started with, of one thousand miles that returned its physical property to be worth $20,000 a mile. It said the stocks were not worth par, and the board took them at their own value, not $200,000,000 as they had outstanding, but $175,000,000, what the board itself said it was worth, or about 82 cent's on the dollar. If you take the mileage of that road at their own figure, take the bonds at par, and they were above par, and you have a stock and bond valuation on that road of over $100,000 to the mile, a property whose physical return value was only $20,000. This is the second test of stocks and bonds according to this law.
   Now there comes the third proposition. The legislature was not satisfied to have the board investigate the value of a railroad two ways, but it said you must do it three ways, and they made a command upon every railroad operating in this state to make a sworn return to the state board of the amount of its earnings, gross and net. My friend said that he thought that this test was a pretty fair test. If you capitalize the net earnings which they say was $4,000 a mile at 4 per cent, that would give the value of the road. His argument was - and the courts agree with him - that the fair rate to capitalize earnings is six per cent. But I have yet to find a reason why the per cent should be that high. Here is a plant which pays four per cent dividends; it is a four per cent institution; its bonds all draw four per cent and some four and one-half and five per cent. Will you tell me why they should be capitalized at six per cent when they are a four per cent plant? But we will take the court's view of it and give the roads the benefit of capitalization at six per cent, and what is the result as to this company I have been talking about? Its net earnings average the system over, more than $4,000 a mile. What is the net earning of a railroad? It is what is left after every item of expense in the operation has been paid. You have



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maintained your road and kept it in repair. Not only that, you have paid your taxes; and whatever is left, that goes into your pocket; after all these expenses are paid, the rest is net earnings. The state board in 1904 was not satisfied to have a return made as to the net earnings of this railroad on its entire system; the board thought the system was earning more money in Nebraska than in the other states, and it asked for a return showing net earnings in Nebraska; and while the returns showed that the whole system over every mile had averaged over $4,000 net earnings, in Nebraska averaged $5,500 per mile net. That is a great earning power. You capitalize this and you have at least $90,000 per mile on an average in this state.
   Now, then, we have applied the three tests that the law authorizes, and this road, worth by the physical property test $20,000; by stock and bond test about $92,0000, and the net earning test something less than that, and you have an average valuation of beyond $65,000 per mile, $10,000 per mile more than it is assessed. Do you wonder the courts sustained that assessment? When you come to the final assessment of railroad property in Nebraska, as in every other state, you have got to depend upon the integrity of our state assessors in fixing the property and its valuation, because it is their judgement that does the business. The law is here, and it is their judgment that must do the rest.
   There are two ways to beat a law. First, never to pass it. That is one way. Second after you have passed it, put some one in office who will not enforce it. That is the second way. I don't care what kind of law you put on the statute books, unless you will put an assessor there who will carry it out, you will never get an equitable assessment. My friends, I have talked longer than I expected. I thank you. [Applause.]



THE UNION PACIFIC IN NEBRASKA.

181

 THE WORK OF THE UNION PACIFIC IN NEBRASKA.

BY E. L. LOMAX.

   A description of the growth and progress of Nebraska, without mention of the Union Pacific, would be like the play of Hamlet without the Prince of Denmark. The construction of the road, its rise and triumphs, are a part of the history of the state, and the prosperity of the road has increased the advancement and wealth of Nebraska which has accompanied, it.
   The Union Pacific was the, first road to enter Nebraska. In 1863 the work was begun and forty miles of road were completed by 1865. Within five more years, 705 miles of road were constructed and operated in the state, and this increase continued until now, in 1902, there are over fourteen thousand miles of rail and water lines directly controlled by the Union Pacific R. R. A reference to this is necessary to show what part the road has taken in enabling the commonwealth to double and quadruple, as it has done. The mileage of the Nebraska division of the Union Pacific is as follows:

Eastern District - Council Bluffs to Grand

   Island and spars

159.95

Middle District - Grand Island to North Platte

137.23

Western District - North Platte to Cheyenne

 225.41

   Total

522.59

BRANCHES.

Beatrice Branch - Valley to Beatrice

96.72

Stromsburg Branch - Valparaiso to Stromsburg

53.30

Norfolk Branch - Columbus to Norfolk

50.37

Albion Branch - Oconee to Albion

34.54

Cedar Rapids Branch - Genoa to Cedar Rapids

30.55

Ord Branch - Grand Island to Ord

60.77

Scotia Spur - Scotia Junction to Scotia

1.37



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NEBRASKA STATE HISTORICAL SOCIETY.

 

Loup City Branch - St. Paul to Loup City.

39.40

Pleasanton Branch - Boelus to Pleasanton.

22.06

Kearney Branch - Kearney to Callaway

65.79

Sioux City Branch - Sioux City to Norfolk.

   74.94

Total Nebraska Division

1,052.40

   Throughout the state there is already one mile of railroad to every fourteen square miles.
   Vast regions of fertile country have thus been opened up to settlers, and great areas of land brought by rail into contact with metropolitan centers. Prosperous cities have sprung up in every section traversed by this line.
   The state in thirty-nine years has grown from 122,000 to 1,068,901 inhabitants, with a proportionate increase in material and other property. Take the following as an example of the surprising growth of Nebraska:

The population in 1855 was

4,494

The population in 1860 was

28,841

The population in 1875 was

247,280

The population in 1880 was

452,402

The population in 1885 was

740,645

The population in 1890 was

1,056,793

The population in 1900 was

1,068,901

In 1860 there was 1 person to 3 square miles.

In 1880 there were 6 persons to 3 square miles.

In 1900 there were 13 persons to 3 square miles.

   The assessed valuation of the State is over $170,000,000; there were 120,000 farms under cultivation.
   It has now nearly 5,600 miles of railways, which is greater than those of Siberia and Japan combined. It is first in intelligence of its citizenship; second in health; third in corn growing and sugar beets; fourth in oats; fifth in wheat; and sixth in hay.
   Its cattle products in 1900 were 2,206,792; sheep 322,057; hogs about 1,500,000.
   In 1900 its smelting work products were $28,000,000; beet sugar, $520,301.



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183

   The estimated value of South Omaha products alone in 1901 is $14,000,000 greater than that of the whole state in 1890. Its true wealth is estimated in 1900 at $1,282,246,800, as against $385,000,000 in 1880, an increase of 233 per cent.
   Its surplus products in 1900 are valued at $225,555,160.89.
   The beginning of all this, the phenomenal growth, dates from the commencement of the Union Pacific R. R.
   In a brief outline of this character it would be impossible as well as unnecessary to describe the early history of this great railroad. It is now a part of the history of the United States, and everybody knows something of it, but in order to appreciate what the Union Pacific has done, it is well to remember that the expanse of territory now called Nebraska was in what our forefathers called "The Great American Desert," which spread its arid, lifeless mantle of land over thousands of square miles of the. great western basin of the Mississippi. In latitude north and south, and in longitude east and west, the awful barrenness extended without limit. Civilization had hardly approached it on any side. The idea of ever crossing this expanse was regarded as well-nigh impossible. In the midst of this seeming hopeless sterility, Nebraska has sprung up - a state of magnificent extent, seventy-seven thousand square miles, or 49,000,000 acres in area!
   It could be spread over all New England, and yet have 11,000 square miles to spare.
   In this stupendous transformation, the Union Pacific has been a mighty factor. Let me cite merely a few of the things this great railroad has done for Nebraska. Take, for instance, the economic importance of irrigation. The distribution of water by artificial methods, better known as irrigation, has received such an impetus during the past few years that it has at last resolved itself into a national proposition. All western and some of the southern States have established state departments of irrigation, Nebraska along with the others. Not that this state could not produce crops without resorting to artificial methods, for the volume of rainfall has increased and continues to increase of late years, but the soil



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NEBRASKA STATE HISTORICAL SOCIETY.

of Nebraska is suitable for irrigation, and farmers have found that it has multiplied the productive capacity of soils.
   The Mormons seem to have started irrigation in the West when they conveyed the waters from the mountain streams of Utah and distributed them over the valleys and tablelands.
   For years after this there was no progress made in the matter of irrigation. In fact, the matter was hardly thought of by residents east of the Rocky Mountains until a few years ago, when the Union Pacific look the matter up and urged it upon the settlers of the western portion of the state. For a time it was slow work, but by being persistent and advocating it in the press and in pamphlets, it soon took root, and as a result today more than 1,500,000 acres of land lying along "the Overland Route," beyond Columbus can be flooded by the waters of the Platte that are tributary.
   The first place where irrigation was tried in Nebraska was along the valley of the Platte. The water was diverted from the natural channel and conducted over the fields. The result was marvelous. That year, while, generally speaking there was an average supply of moisture - as much as in many of the other western states- - the crop yield on the irrigated land was nearly two-fold of that upon land where nature only supplied the moisture. The result of this experiment induced the passenger department of the Union Pacific to urge upon farmers the necessity of constructing irrigation ditches. Not only did the Union Pacific urge this. It assisted in bringing settlers at reduced rates and in many other ways. At this time about fifty irrigation companies are operating in Nebraska near the main line of the Union Pacific.
   Taking Dawson county is example, it will be found one of the most prosperous counties in the state. The main line of the Union Pacific traverses this county.
   The following figures show what Dawson county has done in the way of irrigation:



THE UNION PACIFIC IN NEBRASKA.

185

 

LENGTH,

CAPACITY,

MILES.

ACRES.

Farmers & Merchants Irrigation Co

83

80,000

Cozad Irrigation Co

40

46,000

Gothenburg Water Power and Irrigation Co.

29

25,000

Orchard & Alfalfa Irrigation Co

20

15,000

Gothenburg South Side Irrigation Co

30

15,000

Farmers Irrigation Co

10

5,000

Platte River Irrigation Co

18

8,000

Elm Creek Irrigation Co

10

8,000

Bird & Newman Irrigation Co

8

1,200

Booker & Ralston Irrigation Co

6

1,500

Edmisten Irrigation Co

5

3,000

259

207,700

   In assisting the irrigation movement, in reclaiming arid wastes and making the soil productive despite parching winds, the Union Pacific has helped to make a more prosperous community by laying a sure foundation for the creation of revenue, and the development of the state by inducing the influx of immigration and wealth within its confines.
   It is well known that the Union Pacific R. R. is equipped with heavy eighty-pound steel rails, that its main line is nearly all ballasted with the famous "Sherman gravel" hauled at great expense out to points on the line. During the past two or three years millions have been spent for labor and improving the physical condition of the system. While not all these vast items have been expended in Nebraska, much of it has gone to enrich the residents of the State.
   Since the construction of the road, the Union Pacific has maintained large shops at Omaha and smaller ones at Fremont, Grand Island, and North Platte. For over a quarter of a century this road has carried thousands of these shop men on its payrolls, annually exchanging hundreds of thousands of dollars with them, the company giving them its money and they giving the company their labors in return. In the headquarters at Omaha, the Union Pacific maintains an army of officers and employees who are paid good salaries



186

NEBRASKA STATE HISTORICAL SOCIETY.

regularly. This money has amounted to millions of dollars during the past thirty years, and has been spent chiefly in Nebraska, it large portion of it going to the merchants and the tradesmen and others along its line. When you consider that the Union Pacific has been doing business since 1865, that the vast sums of money referred to have been paid out year after year, you may then get some idea of what it has done and is doing toward the support of the people of Nebraska.
   It is not too much to state that for more than thirty years the Union Pacific expenditure in Nebraska has been far greater than any other corporation doing business in the state.
   Let me answer the question, "What has the Union Pacific done for Nebraska?" by pointing to some of the coming cities of the commonwealth, Fremont with a population of 8,000; Lincoln, 40,000; Columbus, 3,600; Grand Island, 7,500; Norfolk, 4,000; Kearney, 6,000; North Platte, 4,000; not omitting South Omaha with a population of 26,000, the third largest packing center in the United States, and hundreds of other thriving cities, towns, villages, and hamlets, which, by the magic hand of the Union Pacific alone, sprang into existence. But for the Union Pacific, the pioneer railroad company, these towns would not exist. But for the Union Pacific, we might be crossing the plains and climbing the mountains to the Pacific Coast in covered wagons or slow trains of less ambitious roads, instead of in the palatial cars of "The Overland Route."
   The Union Pacific has spent thousands upon thousands of dollars in advertising the state of Nebraska, not only in the United States, but all over the world. Not only in our new possessions but in the cities, towns, and villages of Europe has the Union Pacific placed Nebraska before the emigrant or traveler, as a desirable spot, by maps and pamphlets, by magazines, newspapers, and sundry other ways.
   The following extract from a report of the Senate committee on Pacific Railroads, dated February 19, 1869, shows that the



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187

Union Pacific has been instrumental in building up the state of Nebraska since its earliest days.
   "It can be shown by official records," says the report before mentioned, "that the Kansas Pacific, the Union Pacific, and the Central Pacific have been instrumental in adding hundreds of thousands to the population of the states of Kansas, Colorado, Iowa, Nebraska, California, and Nevada. Minnesota owes to the rapidity and cheapness of transportation by rail her best immigrants - over 100,000 Germans, Norwegians, and Swedes. Every foreign laborer landing on our shores is economically valued at $1,500. He rarely comes empty-handed. The superintendent of the Castle Garden (New York) Immigration Depot has stated that careful inquiry gave an average of $100, almost entirely in coin, as the money property of each man, woman, and child, landed in New York. From 1830, the commencement of our railway building, to 1860 the number of foreign emigrants was 4,787,924. At that ratio of coin wealth possessed by each, the total addition to the stock of money in the United States made by the increase to population was $478,792,400. Well might Dr. Engel, the Prussian statistician, say: Estimated in money, the Prussian state lost during the sixteen years by emigrants a sum of more than 180,000,000 thalers. It must be added that those who are resolved to try their strength abroad are by no means our weakest elements; their continuous stream may he compared to a well-equipped army, which, leaving the country annually, is lost to it forever. A ship loaded with emigrants is often looked upon as an object of compassion; it is nevertheless in a political-economical point of view generally more valuable than the richest cargo of gold dust.
   The words of Sidney Dillon uttered many years ago are not inappropriate now. He said: "The growth of the United States west of the Alleghenies during the past fifty years is due not so much to free institutions or climate or the fertility of the soil as to railways. If the institutions and climate and soil had not been favorable to the development of commonwealths railways would not have been constructed, but if rail



188

NEBRASKA STATE HISTORICAL SOCIETY.

ways had not been invented the freedom and natural advantages of our western states would have beckoned to human immigration and industry in vain. But increased facilities for travel are among the smaller benefits conferred by the railways. The most beneficent function of the railway is that of a carrier of freight. What would it cost for a man to carry a ton of wheat one mile? What would it cost for a horse to do the same? The railway does it at a cost of less than a cent. This brings Nebraska Colorado, Dakota, and Minnesota into direct relation with hungry and opulent Liverpool, and makes subsistence easier and cheaper throughout the civilized world. The world should, therefore, thank the railway for the opportunity to buy wheat, but none the less should the West thank the railway for the opportunity to sell wheat.
   No fact among all the great politico-economical facts that have illustrated the world's history since history began to be written is so full of human interest or deals with such masses of mankind since the railway opened to the seaboard these immense solitudes.
   Within fifty years over 30,000,000 people have been transplanted to or produced upon vast regions of hitherto uninhabited and comparatively unknown territory, where they are now living in comfort and affluence and enjoying a degree of civilization second to none in the world, and greatly superior to any that is known in Europe outside of the capitals. This could not have happened had it not been for the railways, and is a helper in developing this great area the Union Pacific has been a very potent factor.



EARLY DREAMS OF COAL IN NEBRASKA.

189

 EARLY DREAMS OF COAL IN NEBRASKA.

BY GEORGE L. MILLER.

   When the vanguard of the whole occupation are the pioneers first planted foot in Nebraska, a majority of them had come from the timber lands of their ancestral states. When they looked out upon vast oceans of treeless prairie lands, it was hard for them to understand how it was possible for them to be permanently occupied and subdued to the home-making uses of agriculture. They never thought of planting trees except for ornament and shade, where they might grow by proper nursing for their rude little huts. How could trees grow on a "desert"? How could people wait for trees to be planted and grown, even if they could be made to grow at all?
   As was quite natural, they were moved by instinct to dream and dig, for coal. Holes in the hills on the Nebraska side of the Missouri river were bored in plenty from north to south, within the state boundaries, and there were more coal discoveries in those early days of blind hopes and doubting expectation than could be easily counted for numbers. Nor have we done making these coal discoveries yet. Large sums of money have been sunk in these vain quests for coal deposits of sufficient depth of vein and quantity to be made available for use. Veins of coal would, it is true, be frequently found, which would give good ground for confidence that they would supply enough of the black diamonds, for commercial use. But they were only surface veins, and not the real coal measures. These surface veins would be 2 1/2 to 3 feet in thickness, counting the shale, and would yield fine coal, rich in carbon and heating power. These coal discoveries have only led to a large harvest of disappointed hopes and a large loss of money. The late J. Sterling Morton was an early and conspicuous victim of these illusive coal discoveries in the territorial period, one of which was made on the Nebraska City farm. Dr. F. V. Hayden, the famous geologist who made the U. S. survey of the territory, was called in to examine the coal mine. Anxious



190

NEBRASKA STATE HISTORICAL SOCIETY.

as he was on all accounts to make a favorable report, and especially on Mr. Morton's account, he told Mr. Morton the sad scientific truth about it, which more than forty years of time have confirmed. I doubt whether Mr. Morton lived quite long enough to forgive Hayden for telling him the truth. Professor Hayden always held, with Meek, that the coal beds which appear in Iowa dip down very deep in Nebraska, perhaps 3,000 feet. The nearest we ever came to getting a real substantial bed of coal was when Mr. P. E. Iler put down a boring for anything that might be found, oil, gas, coal, or what not, at his old distillery in Omaha. A vein of coal was struck at a depth of several hundred feet which was, in fact, highly promising. Pennsylvania experts were brought out who said so. I was interested in a small way, but I did not forget the warning of Hayden. There were high hopes and much excitement. All Mr. Iler got was a supply of artesian water, which was very valuable to the distillery of which he was then the owner. But Peter's coal mine, like all the rest of them, "petered out."
   When, in 1855, 1 went with the army to Ft. Pierre, dreams of coal and of cedar and pine timber were excited by vague reports of these products on the upper Missouri, and I was asked to look out for them. My point of observation from the decks of a steamboat did not enable me to see anything but the color of coal, where slate and shale had been exposed by the wash of the river. We had heard of islands rich with cedar. I did not see them. As to pine timber, ditto. Reports were circulated of vast deposits of coal through Indians and traders, although I saw none or it. These reports were founded on fact, and if is there in unlimited quantity, to the great advantage of South Dakota. It is the lignite formation. A proposition was made a few years ago to some Omaha capitalists to bring this coal to the Nebraska markets by barging it down the river, but it was ascertained that the coal deteriorated by exposure. It is said to contain more carbon than the Wyoming product which Hayden discovered during the Union Pacific construction. It was in 1867, 1 think,


EARLY DREAMS OF COAL IN NEBRASKA.

191

Hayden brought down the first specimens of Wyoming coal to Omaha, in a gunny sack, and dumped them on the floor of the editorial apartment of the Omaha Daily Herald, which then called itself "a strictly religious journal, price $10 a year, invariably in advance."
   This, in brief, is a mere outline of the brave efforts and uniform failures that were made in the past, and which still continue at longer or shorter intervals, to uncover coal measures on Nebraska soil. Behind these efforts and giving them energy have been the strong motives of individual gain, alluring visions of sudden and large wealth, and also, be it said, a higher, if not a more effective force of public spirit, striving for the advancement of the general welfare of the "young commonwealth." Nothing could be more commendable in motive on the part of ambitious citizens, however misdirected may have been their labors and sacrifices. As the editor of the Omaha Daily Herald, in the cream of my manhood life for many years, I used to share with others a keen regret that Nebraska could not boast the advantage of mineral wealth in any form to reinforce its prodigious capacity for agriculture. It was I who first said in the columns of that somewhat busy little newspaper, "Nebraska's an agricultural state, or it is nothing.", Time and events have confirmed that judgment, and its implied forecast of its sole dependence for development, population, and power, and I may now repeat the retrain with variations, so to say, that enable me to declare that Nebraska's an agricultural state, and wouldn't be a mineral state if it could, even if coal measures were within 500 feet of the surface soil in a general distribution over the state. In other words, when all of our people were deploring the want of coal, they did not appreciate then, and may not now, that it would be a losing trade to swap our fertile and inexhaustible corn, winter wheat, and other cereal-producing lands, for coal lands, or any other mineral lands. Corn beats coal. Coal can be had for the asking from contiguous states by payment of prices for it that are little more than they would be if the state abounded in coal. But what more?



192

NEBRASKA STATE HISTORICAL SOCIETY.

   I am writing this paper at a time when a mighty movement for the improvement of our great rivers, the Missouri, greatest of all, by federal appropriations which will make our great Nebraska boundary line on the east as freely and safely navigable by boat and barge of great capacity as the lower Mississippi, to whose broad waters it is the most generous contributor. Then will come the day and hour when the lignite of the Dakotas will be safely housed and swiftly brought to out, eager wharves at slight cost over mining, in endless supply for all uses, in easy competition with Wyoming, Kansas, Missouri, and other coals.
   I have another vision imparting more than shadowy forms to dreams of the future greatness of the Missouri valley, the Nile of the United States, and two times as rich as the historic river of Egypt, which are not all dreams. Major Chittenden of the U. S. A. says that this Missouri river kingdom of ours is capable of supporting a population of 25,000,000 people. Not pretending to know the half that this accomplished officer does of the great valley, I am bound to agree with him. But to ever realize such results, or any great results from dense populations in this valley, one condition precedent must be deemed vital, namely, the broad acres of this vast natural garden of agricultural wealth must be defended and protected from destructive invasions and overflow from the mad waters of the river. Its improvement for navigation means the certainty of this protection as an almost necessary incident of the work of deepening and widening the channel for boats and barges; at any rate, the people of the West, whose geographical heart Nebraska is, will not fail to redeem and secure, at the hands of the nation, that which is most certain to increase its population, wealth, and power beyond the wildest dreams of men.


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© 2000, 2001 Pam Rietsch, T&C Miller