USA > Pennsylvania > The Register of Pennsylvania : devoted to the preservation of facts and documents and every other kind of useful information respecting the state of Pennsylvania, Vol. IX > Part 34
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121
REPORT UPON LOTTERIES.
1832.]
and grant him some relief. He does this with the more confidence, as he believes them to be men that can pity the distressed; and hearing that Councils were pleased to grant relief in similar cases last year, and for which if they grant this, they shall ever be gratefully remem- bered by their obedient servant,
EZEKIEL HAND, Residence, No.58 Gaskill street.
Reference, To the City Clerk, or Captain of the Watch.
PHILADELPHIA, Feb. 16th, 1852.
A communication was received from Mr. William Champion, relative to re-leasing South street wharf, which was referred to the Committee on the Drawbridge Lot
Mr. LEIFER offered the annexed resolution which was agreed to:
Resolved, That the Mayor be authorized to draw his warrant on the City Treasurer to defray the expenses of the committee appointed to go to Harrisburgh on the 2Ist ult. and that the same be charged to appropriation No. 21.
Mr. SULLIVAN offered the following resolution which was adopted:
Resolved, That the Select and Common Council do assemble at the Council Chamber, on the 22d inst. at 9 o'clock, A. M. and proceed in a body to join the proces- sion which is to take place in honor of the day.
REPORT UPON LOTTERIES.
Report of the Committee of the House of Representatives of Pennsylvania, to whom were referred the message of the Governor and sundry memorials relating to the abo- lition of Lotteries .- Read February 10th, 1832, by_ Mr. Dunlop, Chairman.
The committee to whom was referred that portion of the message of the Chief Magistrate, and the several memorials relating to the abolition of lotteries-RESPECT- FULLY REPORT:
That fully aware of the responsibility imposed upon them, they have bestowed upon the subject submitted to their consideration the laborious investigation to which it was entitled. Sensible of the evils arising from the prosecution of lotteries, and that the picture which has been drawn of the enormous extent to which they have been carried, and the appalling consequences which are daily flowing from this miserable plan of finance, under the alleged sanction of the commonwealth; they could not but feel the strongest disposition to eradicate this cancer from the bosom of the state.
A lottery is at best but systematized gambling, a splen- did lure for the unwary, in which the chance of remu- neration to the adventurer is in proportion to that of any other mode of gaming. Yet, like the Mirage of the desert, it lures and deceives, not only the unconseious, but the most practised beholder. The old and young, the economist and the spendthrift, the knowing one and the innocent, the poor man and the rich, with equal ea- gerness, crowd around this gorgeous temple of fortune, and though to-day the dupes of its deceitful promises, return to-morrow with eyes as anxious and inquiring, to gaze upon and seek the glittering favors it affects to of- fer. In its insatiable coffers are consumed as well the pittance of the poor as the thousands of the wealthy, and though the one may be kept destitute, and the oth- er become the victim of bankruptcy, still the occasional prize that is blindly lavished, crowds the portals with its deluded devotees. Every device that can entrap the unwary, and allure the giddy, is invented and displayed, and a glare as false as it is flattering, that only
"_leads to bewilder, and dazzles to blind,"
deceives from day to day the victims of its delusion.
wary moments by the legislature, to other institutions, which time and circumstance have probably rendered obsolete; but the only one in active operation is exer- cised by the Union Canal Company, an institution which seems to have been in some measure a deserving favour- ite of the public; and your committee, though anxious- ly disposed to cut off this monstrous system of imposi- tion, practised under its authority, have yet been too strongly impressed with the propriety of respecting the rights of the corporation and of individuals, and pre- serving untarnished the public faith, to recommend such a measure, without the most sedulous scrutiny, and con- fident assurance of their own conclusions. Feeling the great responsibility they were under, in deciding upon property to a great amount, upon perhaps the future prosperity of the Union Canal company, upon the gua- rante of the state on the faith of which nearly half a million of dollars had been invested, they invited and enjoyed a full, laborious and able discussion of the whole subject, by counsel on the part of the memorialists, the company and their assignees.
As the power to abolish lotteries, as prayed for by the memorialists, and recommended by the Governor, will depend on a proper construction of the acts of assem- bly, which have conferred upon the Union Canal com- pany the privilege of raising money by way of lotteries, the committee beg leave, as briefly as the discussion will permit, to place their views upon this subject before the House.
The Union Canal company of Pennsylvania was so called from its being formed of two separate compa- nies, which had been authorized to connect the waters of the Delaware and Susquehanna, more than forty years ago. The earliest of them, denominated the Schuylkill and Susquehanna navigation company, was incorporated by an act passed twenty-seventh Septem- ber, seventeen hundred and ninety-one; the other, call- ed the Delaware and Schuylkill canal navigation, was erected by an act of the tenth of April following. In eighteen hundred and eleven these companies were united and re-organized, by an act of the second of April of that year, under the style and title of "the Union Canal Company of Pennsylvania;" and under that name have brought their arduous and meritorious exer- tions to a successful termination.
These companies, and especially since their connex- ion, have claimed and enjoyed from time to time the continued and fostering care of the government. So carly as seventeen hundred and ninety-five, by an act passed seventeenth April of that year, the legislature, to provide efficient funds for completing the canals, au- thorized the two companies "to raise by way of lot- tery," four hundred thousand dollars, of which two hundred and sixty-six thousand, six hundred and sixty- six dollars, sixty-seven cents, were to be applied to car- rying on the works of the Schuylkill and Susquehanna navigation, and one hundred and thirty-three thousand, three hundred and thirty-three dollars and thirty-three cents, to carrying on the works of the Delaware and Schuylkill canal navigation, and which was not to form any part of the capital stock.
Finding it inconvenient to raise the sums authorized to be raised "whilst acting jointly, where a separate interest existed," the latter company was authorized to raise "their proportions of the provisions granted" by the act of the seventeen hundred and ninety-five, uncon- nected with the other company.
After nearly twenty years of the exercise of their corporate powers, after the enjoyment of fifteen years of their lottery privileges, these companies in their memorial to the Legislature of thirteenth of December, eighteen hundred and ten, after lamenting the unpro- ductiveness of the lottery grant, after complaining of "the disorder and embarrassment into which they had fallen," the "reproach and ridicule with which their undertaking was covered," of "the public confidence
There may be other grants of lotteries made in un- / being impaired" in their efforts, and acknowledging Vor. IX. 16
122
REPORT UPON LOTTERIES.
[FEBRUARY
"the spirit of unlimited speculation," which marked in behalf thereof, two hundred and fifty shares of the their commencement, and embarrassed their operations, they prayed the Legislature to aid them with appropri- ations and to unite them under one direction. In pur- suance of this request, the Legislature, by an act passed the second of April, eighteen hundred and eleven, uni- ted them as has been already stated, into one company called the Union Canal Company of Pennsylvania, and conferred upon them further privileges and powers, which become the subject of particular examination. The twenty-eighth section of this act assuming that the two companies had realized about sixty thousand dollars, of the four hundred thousand dollars they had been au- thorized to raise, by the act of seventeen hundred and ninety-five, authorizes the raising of the residue of the original sum not exceeding three hundred and forty thousand dollars, and confers the additional power "if it should appear to them advisable to sell and assign to any person or persons, body politic or corporate, the right to raise the said residue of money by way of lottery or lot- teries, upon such scheme or schemes, plan or plans, as they may from time to time sanction, or any part there- of from time to time," and that "such purchasers or as- signees shall be vested for the term they shall so ac- quire, with the same rights and privileges as the said corporation."
The expectations of the company from the power gi- ven by this act to sell and assign wholly or from time to time, their privileges to raise money by way of lottery not having been answered, the Legislature to promote their views, by an act of the twenty-ninth of March, eighteen hundred and nineteen, authorized a further subscription of two thousand five hundred shares, and as an inducement to new subscribers to invest their mo- ney, by the third section pledged the proceeds of the lottery as a fund for the payment of six per cent. upon the new subscription, and also upon the unforfeited shares of the old companies, "as soon as the two thou- sand five hundred dollars shall have been subscribed," the interest upon the old stock to commence from the time and in the proportion of the new subscription. The pledge of the lottery proceeds to the payment of six per cent. upon the stock having failed to induce the ex- pected new subscriptions; the company taking advan- tage of the current of popular opinion which was then setting in favour of internal improvement, procured in eighteen hundred and twenty-one, further enactments of the Legislature, upon the construction of which the chief difficulty of deciding the important questions sub- mitted to the committee mainly depends.
The first section of the "act for the improvement of the state," above alluded to, passed twenty-sixth March eighteen hundred and twenty-one, after providing "that whenever according to the act" of eighteen hundred and nineteen, which as just stated, empowered the fur- ther subscription of two thousand five hundred shares to the capital stock of the Union Canal company, two thousand two hundred and fifty should be subscribed, the Governor was required to subscribe on behalf of the commonwealth, two hundred and fifty shares, and then procceds as follows:
" SECTION 1. Be it enacted by the Senate and House of Representatives of the Commonwealth of Pennsylva- nia in General Assembly met, and it is hereby enacted by the authority of the same, that whenever according to the provisions of the act supplementary to an act, en- titled " An act to incorporate the Union Canal compa- ny of Pennsylvania," passed the twenty-ninth day of March, eighteen hundred and nineteen, two thousand two hundred and fifty shares shall have been subscribed to the capital stock of the Union Canal company of Pennsylvania, the Governor of this commonwealth be, and he is hereby authorized and required to subscribe
stock of said company, to be paid by the State Trea- surer on warrants drawn by the Governor, in the pro- portion of the payment made on subscribing by the new subscribers, and of the payment of their respective in- stalments as may be called for by the board of managers; and if the proceeds of the lottery granted to the Union Canal company, together with the tolls which may be collected, shall not hereafter from year to year, for the period of twenty-five ycars, yield a sum equal to an an- nual interest of six per cent. upon all sums not exceed- ing in amount four hundred and fifty thousand dollars, which may be subscribed by new subscribers as afore- said, and paid according to law to the capital stock of the said company, the Governor shall from year to year, for the term of twenty-five years, whenever it shall appear to his satisfaction that such disability ex- ists, draw his warrant on the State Treasurer in favour of the said board of Managers, for the amount of such deficiency, which money shall be applied to the pay- ment of an annual interest of six per cent. to such new subscribers, and the faith of the commonwealth is here- by pledged for the term of twenty-five years, for the full and punctual payment of said interest: Provided, that the subscriptions shall be paid in such instalments as shall be called for by the managers of the said com- pany, and each subscriber shall be entitled to interest only from the time of the actual payment of each instal- ment respectively; and in order to avoid as far as possi- ble all disability to pay such interest, so much of the third section of the act aforesaid, as pledges any portion of the avails or nett proceeds of the lottery aforesaid, to the payment of an annual interest to the holders of shares not forfeited in the late Delaware and Schuylkill, and Susquehanna Canal companies, be, and the same is hereby suspended until the canal shall be completed, and the president and managers of said company shall be, and they are hereby authorized to con- tinue during the said term of twenty-five years, to raise by way of lottery, any sums that may be wanted for the purpose of paying to the holders of said stock, the six per cent. as aforesaid: Provided, that whenever the nett proceeds of the tolls shall amount to the said six per cent. the privilege hereby granted of raising mo- ney by lottery, shall during such time he suspended, ex- cept so far as is authorized by existing laws, and it shall in no event be lawful to divide any sum arising from said lottery over and above six per cent. upon the stock of said company, it being the intent and meaning of this act, that all such excess shall be reserved to meet any deficiency thereof, that may at any time occur in the tolls as aforesaid."
The old companies and the Union Canal company had, under the several acts of Assembly specified, pro- ceeded in the exercise of their lottery privileges with various success. During the first fifteen years, from seventeen hundred and ninety-five, till eighteen hun- dred and eleven, when the two companies were united, they were conducted, of course, under their own management, there being no authority to sell or assign prior to the passage of the latter act. Du- ring that period they had realized about sixty thousand dollars, or at the average of about four thousand dollars per annum. Since the authority to sell and assign, gi- ven by the act of eighteen hundred and eleven, the company have drawn no lotteries themselves, but have conducted them through the medium of assignees.
On the seventh April, eighteen hundred and twelve, about a year after the incorporation of the Union Canal company, they sold, and assigned abso- lutely to Henry Pratt, "all the right, privilege and au- thority, to make lotteries within the state of Pennsyl- vania." Mr. Pratt was to deduct, from the gross amount of each class, fifteen per cent. and pay the com- pany two and a half per cent. clear of all expenses, upon the two first classes, and five per cent. on each succeed- ing class. The lotteries, at this time, were in a state of
NOTE .- The two thousand two hundred and fifty shares, at two hundred dollars per share, makes the four hundred and fifty thousand dollars.
123
REPORT UPON LOTTERIE'S.
1832.]
great depression, and Mr. Pratt, with all his ability, made but little profit on the adventure. The company, conceiving they could procure more favorable terms elsewhere, prevailed upon Mr. Pratt to re-assign the privilege to them for fifteen thousand dollars, and on the thirty-first March, eighteen hundred and four- teen, sold on the same terms, except the amount which had been raised by the first class, under the manage- ment of Henry Pratt," to Benjamin Betterton IIowell. The next contractor of the company was Solomon AI- len, who drew the fourth, fifth, sixth, seventh, eigthth and ninth classes, the first having been drawn by Mr. Pratt, and the second and third by Mr. Howell. The company, by the first contract with Mr. Allen, which is dated thirteenth January, eighteen hundred and se- venteen, sold and assigned to him " the right, privilege and authority, to raise, by way, of lottery, within the state of Pennsylvania, so much of the sum of money which, by the act of Assembly, it is permitted to the said company to raise by lottery or lotteries, as can be pro- duced by the scheme and plan hereto annexed," for which he was to pay ten thousand five hundred dollars. The other five classes which Mr. Allen drew, were au- thorized from year to year by contracts, couched in similar language as respects the power conveyed; the last of them for the ninth class, being dated ninth March, eighteen hundred and twenty-one.
Thus far the schemes of no one year, as will be per- ceived by the synopsis of them hereafter furnished, ex- ceeded much, half a million of dollars. It was left for the adventurous spirit of the present contractor, Archi bald M'Intyre, to push these bold efforts at speculation to an annual aggregate of upwards of five millions.
The first contract with him is dated on the seventh October, eighteen hundred and twenty-one, about five months after the passage of the act of Assembly of that year, under the provisions of which the company claims to exercise the power of additional lottery privileges. The contract professes, " by the authority vested in the president and managers of the Union Canal company of Pennsylvania, by the twenty-eighth section of the act of Assembly, passed the second day of April, eighteen hundred and eleven," to sell and assign " unto the said Archibald M'Intyre, the right, privilege and authority to raise, by way of lottery, in the state of Pennsylvania, so much of the sum of moncy which, by the said, or any subsequent act of Assembly, it is permitted to the said company to raise by way of lottery or lotteries, as shall be produced by such schemes or plans of lottery as shall be adopted by the said Archibald M'Intyre, within three years from the first of November," then next, for which he engaged to pay them eleven per cent. on the amount of each scheme, and that he will not draw a less sum than one hundred and fifty thousand dollars in each and every year. It is stipulated, also, on the part of the company, that his friend John Yates, of New York, or some one named by him, in case of contractor's death, shall have the management of the lottery privi- lege transferred. On the seventh of October, eighteen hundred and twenty-four, the company entered into a new contract with Mr. M'Intyre, to terminate on thirty- first December, eighteen hundred and twenty-nine, on terms similar to the one preceding, except that he is to pay one hundred and fifty thonsand dollars, in several payments and as a gross sum, and not a per centage was to be paid, the extent to which he is to carry the privilege is left without any stipulations of requisition or restriction. On the twenty-first of September, eighteen hundred and twenty nine, a few months be- fore the grant of eighteen hundred and twenty-four would have expired, they entered into another contract for two years from thic first January, eighteen hundred and thirty, by which he engaged to pay the company, thirty thousand dollars per annum, for such schemes is he might alopt. The contract now subsisting between Mr. M'Intyre and the company, and under which he is at this moment rapidly projecting his lottery schemes,
is dated the sixth day of September last, and transfers to him " the right, privilege and authority, to raise by way of lottery, in the state of Pennsylvania, so much of the sums of money which, by the said acts, or any other acts of Assembly, it is so permitted to the said company to raise by way of lottery or lotteries, as can be pro- duced by such schemes or plans of lotteries, as shall be adopted by the said Archibald M'Intyre, for two years" from the first January, eighteen hundred and thirty-two. The committee deem it of some importance to call the attention of the Ilouse, to the change of phraseology adopted by the two last contracts. In those of eighteen hundred and twenty-one, and eighteen hundred and twenty-four, they state their authority to be derived from the act of eighteen hundred and eleven alone, in these terms: "and by the authority vested in the pre- sident and managers of the Union Canal company of Pennsylvania, by the twenty-eighth section of the act of Assembly, passed the second day of April, eighteen hundred and eleven, have agreed to sell and assign," &c. Whether they opened their eyes to new views up. on their corporate privileges, were grown careless of pub lie scrutiny, or changed their legal advisers, certain it is the company seem, in their two last assignments, to have taken more extensive ground than they had con- ceived themselves entitled to occupy before. In the re- cital of their authority, in the contracts of eighteen hundred and thirty-one, they look not merely as they had done before, to the act of eighteen hundred and eleven, probably for the first time, in eighteen hundred and twenty-nine, construing the act of eighteen hundred and twenty-one, as conferring a cumulative and distinct grant, and not requiring the aid of the old lottery to raise the six per cent. for the new subscribers. The contracts of eighteen hundred and twenty-nine, and eighteen hundred and thirty-one, recite their authority thus: " That whereas, by an act of Assembly of the commonwealth of Pennsylvania, passed the second day of April, eighteen hundred and eleven, entitled," &c. in the twenty-eighth section thereof, the said company is permitted, among other things, to sell and assign to any person, &c. the right to raise a sum of money not exceeding three hundred and forty-thousand dollars, by way of lottery or lotteries, upon such schemes, &c. as they may sanction, &c. ; and proceed to add, what is not inserted in the other contracts of Mr. M'Intyre, the following clause: " And whereas, by the first section of ' another act of Assembly of the commonwealth of Penn- sylvania, entitled An act for the improvement of the state, passed the twenty-sixth March, eighteen hundred and twenty-one, the president and managers of the said company were authorized to continue, during the term of twenty-five years therein mentioned, to raise by way of lottery, any sums that may be wanted," &c.
These clauses when connected with the short period of time at which the latter contracts are taken, have too strong a bearing upon the argument which it is purpos- ed to submit upon the construction of the powers and privileges conferred upon the Union Canal company of drawing lotteries, to be omitted.
It is from the date of the contract of eighteen hun- dred and twenty-four, that Mr. McIntyre has launched out into the most lavish use of the power he fancied or pretended to fancy he held of speculating upon the cu- pidity of his fellow citizens. The committee call the attention of this house to the exemplification of the boundless spirit of rapacity which actuates men in the pursuit of wealth to be drawn from the giddy propen- sity to gambling and chance. It is manifest from the terms of the first contract in which it was deemed ne- cessary to require him to draw schemes to the amount of one hundred and fifty thousand dollars a year, that neither le nor the company dreamed of the prodigious extent to which the credulity of the people could be practiced upon. These impressions are strengthened by casting the eye over the list of schemes drawn under his first contract in eighteen hundred and twenty-two,
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REPORT UPON LOTTERIES.
[FEBRUARY
eighteen hundred and twenty-three and eighteen hun- dred and twenty-four, during which they did not in any one year much exceed three hundred thousand dollars. But in proporiion as his hopes are expanded, as new contrivances to facilitate the convenience and rapidity of drawing lotteries are invented, as the votaries of for- tune crowd around him to snatch the splendid delusion, he seems to acknowledge no limits to their extent but the capacity of the people to buy. From the time of his second contract, under which he pays. no more for drawing millions than he does under the first for draw- ing thousands, he seems to have launched into an illimit- able ocean of profit and speculation. His annual schemes progressively swell from three hundred and eighteen thousand three hundred dollars in eighteen hundred and twenty-four, to five million two hundred and sixteen thousand two hundred and twenty dollars in eighteen hundred and thirty-one. If these alarming strides of rapacity in getting, know no check, if they defy all pow- er to stay them, and make from the last to the present year, the same proportionate rapidity of advance as they did from eighteen hundred and twenty-nine to eigh- teen hundred and thirty, we shall perceive a stream of more than ten millions of dollars pouring from the poek- ets of the people into the insatiable coffers of the lot- tery broker in this one lottery alone. It is foreign to the subjeet under consideration to which the committee desire strictly to confine themselves, to go into any esti- mates of other and foreign lotteries that spread their baleful influence over the United States, and of which Pennsylvania receives her full share of siekening venom; but there is a little doubt upon even a moderate esti- mate, that those drawn under the auspices of this same contractor, yield a nominal profil, and probably an aettial gross profit, of more than fifty thousand dollars a day. We may form some conception of the appalling magni- tude of a system of gaming, incitements to which are displayed in such winning phrase and alluring profu- sion in the streets of our cities that yields to those who minister to the cupidity of their fellow citizens such enormous receipts. When we know that the power of checking these monstrous fungi on the body of the state, as deadly as the cholera of the Indies, is placed inthe hands of the company, and perceive her casting over them the shadow of her indifference or indulgenee to shield them from the light of public scrutiny and criminal punishment, we must all acknowledge the ne- eessity of eradicating those that afford protection and plausibility to the rest. Does not this state of things .call loudly for redress from the publie guardians of the morals of the people, from a government whose duty it is to protect the credulous and unwary, to remove all temptations to viee, aud to suppress the inordinate pur- suits of wealth, by chance and gaming. Shall we be .. arrested in such a hallowed purpose by vague state- ments that these lotteries are not sueh sources of wealth to the broker who projeets them, when the assertion is so manifestly refuted by the extent to which they are carried. If they were not a source of profit and gain why projeet aod conduct them, if their advantage were not proportionate to their magnitude and number, why extend and increase them? It were well were we as surely persuaded of the loss of the broker as of that of the adventurer who buys. We would then need no legislative provisions to suppress their evils.
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