historians concede that at this particular point in time, Russell did not know that the bonds were stolen.

If Russell was innocent when he accepted the first batch of bonds from Bailey, he was not after he returned for the second. And return he did, for the money he had been able to raise on the first bonds was soon devoured by the expenses of the company's many enterprises.

By this time Bailey was getting nervous and told Russell that the bonds belonged to the Department's Indian Trust Fund, and that he, Bailey, had no right to remove them from Interior's vaults. We do not know how Russell reacted to this bit of news, but he did talk Bailey into furnishing him with additional bonds worth $387,000. That money also quickly disappeared down the great maw of Russell's many enterprises. When it was gone, Russell went back to see Bailey for the third time.

By this time Bailey must have felt like a man who has caught a tiger by the tail, but he turned over a third batch of bonds

valued at $333,000. Altogether Russell had poured a total of $870,000 in stolen funds into his sinking company without even checking its drift into bankruptcy.

Russell's partners knew nothing about the stolen bonds, but by fall the hand writing was on the wall for all to see. The company was bankrupt. A meeting was called and the annoucement was made that the great firm of Russell, Majors and Waddell was broke. In what must have been the ultimate of bookkeeping detail, they listed their obligations at $1,662,342.16.

Among those who had been loaning money to the Company was Ben Holliday, a close friend of William Russell. In the wake of the bankruptcy, Holliday took over company assets, leaving Congress to eventually restore the money stolen from the Indian Trust Fund.

Even at its inception, the Pony Express was seen as a temporary expediency to keep open communications with California until a more efficient system could be

devised. Just at the railroad was a working reality when Butterfield's Stage started operations, so was the telegraph in wide use when the Pony Express was organized in 1860. It was the telegraph that made the Pony Express obsolete. When the first Pony Express rider left St. Joseph on April 3 1860 there was already a telegraph line between San Francisco and Carson City, Nevada Territory and from St. Joseph to Fort Kearney. As the first Express Rider passed through Carson City, the news of his passing was flashed ahead to Sacremento and San Francisco. Almost from the beginning the Pony Express accepted telegraph messages and bridged the gap by carrying them from wire end to wire end.

In June of 1860 Congress passed a bill appropriating money for the completion of the telegraph line to California. In addition to the funds, Congress also authorized the contractor to take poles and other construction materials from the public lands.

In October it was announced that Hiram Sibley had been

Completion of the tele

graph line doomed the Pony Express to obsolescence.

awarded the contract to build the line that would make possible transcontinental telegraph service across the nation.

Wires from the east were spliced with those from the west in Salt Lake City on October 24, 1861. Two days later - October 26, 1861 the Pony Express officially went out of business. Mail continued to arrive in California until November as those riders already on the road completed their assigned rides.

During the more than 18 months it was in operation, the Pony Express carried 34,753 pieces of mail. One mochila was lost. Although Congress eventually extended it recognition, the Pony Express operated as a private mail service.

At the beginning, the Pony Express charged $5 per half ounce for a letter carried between St. Joseph and San Francisco. After January 1, 1861 the fee was reduced to $2.00 and on July 1, it was reduced to $1.

During the 18 months of operation, there was never a month when revenue met the expense of the operation. The financial failure of the service made a significant contribution to the downfall of its parent company Russell, Majors and Waddell. However, in

all truth, bankruptcy was inevitable well before the Pony Express was started.

The full story of the Pony Express can not be told without returning to the matter of the stolen Indian Trust Bonds. About the time Russell, Majors and Waddell were sitting down to draw up a declaration of bankruptcy, Goddard Bailey went to the Secretary of the Interior and made a confession.

The details of Bailey's deal with Russell is not known, but he had certainly expected to return the bonds to the Interior safe before they were missed. The bankruptcy of the firm destroyed any hope he had of avoiding expo

considerably less than what the government owed his company.

Russell, Bailey and John Floyd were indicted by a District of Columbia Grand Jury on January 29. Not one of the three were ever brought to trial.

Russell's case was thrown out of court on the grounds that his testimony before the Select Committee made an effective defense impossible. Was that the reason for his candor?

Charges against John Floyd were dropped on the grounds of insufficient evidence. Bailey was released on bail. He jumped bail and escaped to take refuge in the Confederate States. After the war the case was never reopened.

Historians still debate the motives of William Russell. After his indictment, the story was circulated that he was the victim of a trap set by southern sympathizers and foes of a central route to California. Russell never took refuge in this version of his downfall. He has also been pictured as a man who sacrificed himself to save California for the Union. But he was known to be sympathetic to the institution of slavery. Con man or patriot? Villian or hero? Perhaps the reason it is hard to decide is because he was a little of each.

19

Bicentennial Issue

institutions and developed its own I way of doing things. Like fussy diners, they toyed and picked among the morsels choosing those that suited their taste and rejected those they found unpalatable. The choices were not always wise, consistent or logical, but what emerged was a culture that was American.

In England, land was all important. Social rank, prestige, and even wealth went hand in hand with a man's estates. Of all a man's possessions, land was the most valued commodity..

In the beginning, all land titles came from the King. He was the ultimate landlord, and all land within the kingdom was his property. The king then parceled out his estates to those he wished to befriend, or to those to whom he was indebted. To pay homage to the king or to serve him in war or peace was once no more than a way of paying rental in return for continued rights to use and benefit from the king's land.

From the throne, land rights were passed down through lesser ranks until at last even the lowly peasant could till his few precious acres secure in the knowledge that his tenure was ultimately guaranteed to him by the king and to the king by God.

This was the historic and ancient system of Feudalism favors and rights filtering down and debts and obligations filtering up that dominated Europe through the dark ages.

Like all social systems, it had undergone evolution and even some revolution. By the time America was settled it was greatly modified, but there were vestiges firmly entrenched in the pioneer mind that not even the catharsis of the frontier environment could wholly uproot.

Editor's Note: The converse of the Feudal system, and the system on which we base land titles today, is the allodial, whereby a man owns land in his own right rather than on the sufferance of any other. This concept was not unknown in Feudal times, but both peasant and Nobleman alike considered an allodial title inferior since it lacked the sanction of high authority.

After the Revolution the citizens of the Republic had no king, and hence nothing to hang a feudal title on. Yet lacking a king, the pioneer, in keeping with his European culture, did very much. want his land titles recognized and secured by government. Thus it was that the founding fathers soon turned their attention to the development of an orderly system for granting and recording title to land. Well before they had adopted the Constitution, or elected a President by popular vote, Congress started to grapple with questions about the disposal of land and land tenure.

On October 10, 1780, almost a year before Yorktown, Congress passed legislation foreshadowing future land policies. With that Act Congress accepted responsibility for the land ceded to the Federal Government by the states, declared such land to be a public domain, belonging to all, and decreed that land within the public domain would be disposed of in a manner that would benefit all the states. It further provided for the territory included in the public domain eventually to be formed into new states having the same rights enjoyed by the original 13 states, and finally decreed that the method of disposing of public land would be determined by

Congress. Under the circumstances, it was a good start.

In 1783 a group of two hundred Revolutionary officers prompted Congress to further action. In a petition, known as the Newberg Address, they reminded Congress of its promise to give land to its veterans and suggested that Ohio land be formed into a new state and parceled out to satisfy the war veteran's claims. In response Congress appointed a committee to study the matter. Thomas Jefferson was made Committee Chairman. The members were told to prepare an Ordinance to provide for the disposal of public land.

Once Jefferson's committee was in session, it ran into controversy - foreshadowing the debates that have accompanied all land legislation down to our present day. Among other disagreements was the question of how to lay out the boundaries of the individual tracts. Members of the Committee from New England favored the rectangular system of survey; Southerners favored the less rigid system of metes and bounds already in use in the Southern States.

Under the rectangular system all boundaries run north-south and east-west, making square corners. Southerners felt that the settler should have the option of running his boundaries wherever he wanted to. With the metes and bounds system, the settler could take advantage of natural barriers and landmarks and could adjust his property lines to take in flat bottom land or other advantageous features of the landscape.

New Englanders also favored compact settlement selling all the land in one township before opening another for sale. The

21

Southerners were again more liberal. They believed that it was the settler's privilege to decide where he wanted to settle.

The Committee tried to weave its way between the extremes of each side, and the report it submitted made the following recommendations:

* No land would be sold until it had been surveyed and the survey recorded.

* No land would be opened to
settlement until it has been
purchased from the Indians.
Surveys would be by the rect-
angular system. The land
would be divided into town-
ships, also called hundreds, of
ten mile squares. Hundreds
would be further divided into
lots of one mile square.
Surveyors and Registerers
would be appointed by Con-
gress.

* Military land warrants could
be exchanged for land.

* The settler would be free to
locate his land anywhere he
chose.

The Ordinance was significant also for what it left out. No improvement of the land was required, no provision was made for schools or churches and no minimum price per acre was set.

The report was never adopted, but it became the basis for the Ordinance of 1785.

The Ordinance of 1785 was much more detailed than the report of 1784 and modified it in significant ways. It became the foundation for much of the Nation's present land policy.

Washington, among others, believed that settlements should not be too widely scattered.

"Compact and progressive settlement will give strength to the Union," he said.

Townships were reduced to 6square miles, but were still subdivided into sections of onesquare mile. All land in a given township would be sold before the next township was opened for sale. The rectangular system of survey was adopted and has been the basis of our survey system every since. All land would be sold at public auction, and a mini

mum of $1 per acre was established. Section 16 in every township was reserved for the maintenance of public schools. This provision also became a part of the public land policy in force today. Sections 8, 11, 26 and 29 were reserved for the use of Congress. This provision was dropped after 1800. One-third of all gold, silver, copper and lead found on the land belonged to the Federal Government. This provision was also dropped at a later date.

Again the omissions were significant. Land was set aside for the schools but none to support religion. There were no limits set on the amount of land a single individual could buy. There were no requirements for improving the land, and no provision was made for the squatter.

Once Congress adopted the Ordinance of 1785, the Federal Government had the basic elements of a public land policy and a plan for the settlement of the frontier. It was a plan that had many weaknesses, but also some strong points and certain of the provisions would be in force for the next 191 years. Looking back with the clarity of hindsight, several things seem worthy of comment.

The provision requiring the Indian title to land be cleared prior to opening the land to settlement may surprise many. The charge that the European settler stole the Indian's land has been made so frequently that it has become one of the most widely accepted tenents of American History. Yet the purchase of Indian rights was a basic policy of the Nation's land policy from the beginning.

One wonders why 640 acres was the smallest tract offered for sale. The same Congress had also issued 100 acre land warrants to thousands of veterans. These veterans later found themselves severely handicapped when they went to exchange their warrants for land, since the minimum they could buy was 640 acres.

The refusal to reserve land in support of religion probably reflected the feeling that would lead to the principle of separation of church and state to be enun

ciated in the Constitution.

The refusal to place a limit on the amount of land a single individual could buy, or to require any improvement of the land once it passed into private ownership clearly favored the land speculator, and worked against the settler seeking land for a home. In taking this position, Congress reflected the views of Alexander Hamilton and the Nation's desperate need for money. Land was the Republic's only abundant resource. To officials of the Government, it was seen as a primary source of revenue. The sale of many small tracts required an outlay in administrative costs that made them unattractive to a budget minded Congress since the proceeds would trickle in too slow to meet the day to day need for revenue. Through the sale of large tracts of land it was hoped that significant revenue could be raised. As to whether this viewpoint was good or bad is still a matter of viewpoint. It became a cause of bitter debate that lasted for the next 77 years, or until Congress passed the Homestead Act in 1862.

The failure to make any provision for the squatter, the man who moved onto and improved land ahead of the line of settlement, and frequently ahead of the survey crew was another matter that would trouble Congress in the years to come. The squatter occupied the land without buying it, and in law he had no legal claim to the land he occupied. But he often had the sympathy of his neighbors and sometimes of the courts. In his own eyes he had a rational and moral right that transcended the law. The squatter was frequently in the vanguard of settlement. He got to new country first, cleared the land of trees and underbrush with backbreaking toil and withstood the attacks of Indians. By the time the Government made the land ready for sale, the squatter had done much to make it attractive to other settlers and hence had increased the value of the land. Eventually Congress would have to find a way to deal with the Squatter.