He first ran over to Amsterdam from London, arriving there late in the morning. At 10 A. M. that day he notified the Dutch bondholders of the Denver Pacific that he would be pleased to meet them at 11 o’clock. Promptly at that hour he met them, and at 12 he left Amsterdam with his gripsack full of the securities of the Dutch bondholders. By this means he captured control of the Denver Pacific. Inside of ten hours he bought out Commodore Garrison’s interest in the Missouri Pacific. He bought out ex-Governor Ames’ interest in the Central Branch of the Union Pacific, and he had previously formed a pool by which he acquired control of the Kansas Pacific.
One day the Union Pacific directors awoke to the alarming discovery that Mr. Gould had dropped out of their organization and was surveying a line from Denver to Salt Lake City. The Kansas Pacific was utterly worthless, the Central Branch had not earned any money for years, the Denver Pacific had been in very bad shape; but when the Union Pacific directors discovered the extent of Mr. Gould’s combinations they lost no time in boarding a special car in Boston and rushing over to New York to see him about it. They went up to Mr. Gould’s house and were there gathered in by him on the consolidation of the three roads, all of their stock being exchanged at par and merged into the new Union Pacific Railway Company as distinguished from the Union Pacific Railroad Company.
This incident formed one of the subjects of inquiry committed to the Pacific Railroad Commission in 1887. The members of the commission appointed by President Cleveland consisted of Gov. Pattison, of Pennsylvania; E. Ellery Anderson of this city, and David Littler, of Illinois.
The Union Pacific railroad and the Kansas Pacific railroad companies had received government subsidies in bonds and lands. The bonds were received upon the stipulation that the companies would pay at par and accumulated interest upon their maturity. The first of these bonds will mature in 1895. An application had been made by the Pacific railroads to Congress to extend the time of payment, and this commission was appointed to report upon that matter and incidentally to furnish Congress with information relative to these deals which had affected the status of the corporations.
The commission began its sittings in this city, at No. 10 Wall street. A large number of railway magnates intimately connected with the Pacific railroads were first examined, including Russell Sage and Sidney Dillon. They were examined particularly with a view to finding out exactly what had taken place when the Union Pacific railway was created. They seemed to know nothing about the matter. At every point the well-directed questions of the inquirers were adroitly turned aside. The witnesses did not know or could not remember. No light had yet been thrown upon the subject under examination. But the great witness of all was reserved for the last. This was Jay Gould. He knew it all, but the great question was, “Would he tell?” Nobody believed that he would tell voluntarily the facts relating to his connection with the government interest in the matter, but it was believed that a severe and searching cross-examination would compel him to divulge some of the facts.
An immense amount of labor was gone through with in anticipation of the time when Jay Gould should take his seat in the witness chair. Men on the inside and familiar with the lines along which the inquiry should be directed devoted weeks to the study of figures and the procurement of papers upon which to base the questions which should be asked of Mr. Gould. Dozens of questions on the same subject were prepared. If he answered one question one way he was to be asked a certain question, and if he answered another way he was to be asked another question. In this way it was believed when Mr. Gould took his seat that the beginning of a long struggle was at hand.
That was on May 17, 1887. Mr. Gould wore a plain pepper and salt suit and a shabby silk hat. The examiners, all ready to level their batteries of questions at him, were dumbfounded when the first questions were asked and Mr. Gould blandly stated his willingness and desire to afford all the information in his power. He seemed anxious to withhold no facts, to evade no questions, and to help the members of the commission in their work.
There being some uncertainty as to the exact route of some of the roads in question, Mr. Gould even took out of his pocket a little map and kindly enlightened the members of the commission as to the various localities, and said: “I had anticipated that possibly you might want to know what had been my holdings of various securities relating to this transaction, and so I instructed my bookkeeper to draw off a statement, which I now submit to you.” He then produced a little memorandum covering about sixteen lines of writing, which covered all the facts and gave the cue to every feature of the transaction. Mr. Gould said he had kept books of all his transactions.
Q. Where are the books? A. I have them.
Q. Where? A. In my possession.