“And there he is with his useless timber!” John Cardigan murmured thoughtfully. “The poor Scotch sucker!”
“He isn't poor. The purchase of that timber didn't even dent his bank-roll. He's what they call in England a tinned-goods manufacturer--purveyor to His Majesty the King, and all that. But he would like to sell his timber, and being Scotch, naturally he desires to sell it at a profit. In order to create a market for it, however, he has to have an outlet to that market. We supply the outlet--with his help; and what happens? Why, timber that cost him fifty and seventy-five cents per thousand feet stumpage--and the actual timber will overrun the cruiser's estimate every time--will be worth two dollars and fifty cents--perhaps more.”
The elder Cardigan turned slowly in his chair and bent his sightless gaze upon his son. “Well, well,” he cried impatiently.
“He loans us the money to build our road. We build it--on through our timber and into his. The collateral security which we put up will be a twenty-five-years contract to haul his logs to tidewater on Humboldt Bay, at a base freight-rate of one dollar and fifty cents, with an increase of twenty-five cents per thousand every five years thereafter, and an option for a renewal of the contract upon expiration, at the rate of freight last paid. We also grant him perpetual booming-space for his logs in the slough which we own and where we now store our logs until needed at the mill. In addition we sell him, at a reasonable figure, sufficient land fronting on tidewater to enable him to erect a sawmill, lay out his yards, and build a dock out into the deep water.
“Thus Gregory will have that which he hasn't got now--an outlet to his market by water; and when the railroad to Sequoia builds in from the south, it will connect with the road which we have built from Sequoia up into Township Nine to the north; hence Gregory will also have an outlet to his market by rail. He can easily get a good manager to run his lumber business until he finds a customer for it, and in the meantime we will be charging his account with our freight-bills against him and gradually pay off the loan without pinching ourselves.”
“Yes. I met him while I was in San Francisco. Somebody brought him up to a meeting of the Redwood Lumber Manufacturers' Association, and I pounced on him like an owl on a mouse.”