The President of the United States and Congress had their own
troubles at the close of the war, and the Government could do but
little money-raising with land-grants and loans. But they offered a
great bonus to the men who would build the railroad.
The first construction company subscribed over a million and a half
dollars, and paid in one-quarter of that. The money went so swiftly
that it opened the company's eyes to the insatiable gulf beneath
that enterprise, and they quit.
Thereupon what was called the Credit Mobilier was inaugurated, and
it became both famous and infamous.
It was a type of the construction company by which it was the custom
to build railroads at that time. The directors, believing that
whatever money was to be made out of the Union Pacific must be
collected during the construction period, organized a clever system
for just this purpose.
An extravagant sum was to be paid to the Credit Mobilier for the
construction work, thus securing for stockholders of the Union
Pacific, who now controlled the Credit Mobilier, the bonds loaned by
the United States Government.
The operations of the Credit Mobilier finally gave rise to one of
the most serious political scandals in the history of the United
States Congress.
The cost of all material was high, and it rose with leaps and bounds
until it was prodigious.
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