ERICAN

 

RAIL

OAD IIURN L.

   STEAM iNAVIGAT,|c0N,i co‘MMEI1cE, FINANCE,   p
ENGINEERING, BANKING, MINING, MANUFACTURES.

  ,E,STABLIiSHED   IN 1 83 1 .  

‘PUBLISHED wnnnnr BY’ JOHN H. scHU,Lcrz,’ AT‘ NO. 9‘ sranon srr., NEW YORK, AT «FIVE DOLLARS ‘Pun ANNUM.

Sncoun Qnanro Seams, Von. XXX., No. 14.]

sarunmv,‘ APRIL 4, 1374. ,

[WHOLE No. 1,930, VOL. XLVII.

' Ii?‘ Mn. IFREDERIC stem, No. 3 Clements
Lane, Lombard Street, Lounon, England, is the authorized
lturopean Agent for the J onmun; -' ' '

m_'_ -_

PRINCIPAL .("-0N'1‘l§1N'l"S.

The Public and the Trunk Line Railroads .'... 417
Chicago and Alton Railroad.....”._'...  ....4l8
Philadelphia and Reading Railroad.   .420
The Goal Trade of the United States  ....422
Allegheny Valley‘Railroa'd'.... .... L... ..'.. .422
Texas Railroad....  .... '..“.‘.   ..‘.'423
Internal Seaboard Navigation. : . . . ‘. .’..l.; ’..i . .425
Commendable Action of Gov.,Hartranft ...§. ..426
Arkansas Railroad Aid Bonds.  
Dividend and Interest Tables.... .... ..424,'426
Railroad Share List....  ...} ...‘. ..'.434
Stock Exchange and Money Market .. .. .p. ..441
Atlantic and Lake Erie Railway....  ..,.443

 

ante:-man. Railroad ,-.Journ‘al.

iNevir ‘lfork, Saturday, April  1'8_7&.,c

The Public and the 'I‘1-unk Line Railroads.
President Thomson, ‘of the Pennsylvania Rail-

road Company,‘ in submitting to the shareholders‘

the Annual Report of the Directors, takes occasion,
under the head of “General remarks," to allude
to some of the prominent topics relating tointer-
nal transportation, now very widely discussed,
more particularly the cost‘ of'm_oving agricul-
tural products to the seaboards, the conditions of
canal competition with railroad~-lines, and the
practical "hearing of the policy of stock “water-
m,‘«,e:.7 H These observations have great value both
f'romc.the.fact that;-they are very’ ably..presented,
and are besides the testimony of the chief oflicer
of one of the largest transportation corporations
in thecountry, whose raznified lines are sp_rea_d

over the. western States, where the burden of .th_e. I

farmers-is alleged. to . he. insupportable.. The
perusal of the _Pennsy1v'ania:Company's Report

will have uncommon‘interest for the thinking pub? .

licat large, as well [as for the stockholders imme_-.
diately addressed. ‘  = , 2 , ,_ 75 ,; '.; ._

This discussion of twoor .three-"topics.‘—.upon
which it was supposed riailrdad men would be ret-

ifcem, by the chiefbf"_their:number, is tin:1_cly',and .

the subject has been well presented"-in‘the.{R_eport

before us. It states, for example, in regardsto.
that portion of the freights which ’co_nstitutes:_the'. _i
bulk oi the eastward bounclpand, upon__which —_

. . 425.

great stress is laidby the farmers and their repre-
sentatives: 4 ' A

. “A close examination of the accounts of this
company will show that its charges for -freight
upon agricultural products searcelybear the ex-
penses of transportation, and on many items the
charges for transportation are below actual cost,
leaving for the conveyance of the aggregate ton-
nage of agricultural products little or no profit to
that-ailroad company; this is largely due to the
irregularity of, its movement, and the compara-
tively small amounts of back-loading obtained, as
four-fifths of thecars return empty. , The profits:
of the company from this source are almost Whol-

ly derived from the'transportation at higher rates
of‘ the valuable articles which the sale of these-

products enables the merchants and farmers to
purchase in the Eastffor consumption at home.

If the shareholders of the Eastern Trunk Lines?

relied "upon the direct‘ profits from the carriage of
‘agricultural products for ‘dividends they Would. be
disappointed in their Vexpectai.i'ons.” : ‘ _

H. This testimony is in . conformity with other
statements which have recently been made public.
It is well vk-nown_th'at there haslately been a‘ sharp
competition between the rival trunk lines for the

carriage of‘bre’ads'tutl”s and field prodncts. Dar!

ing the past three years. this rivalry has- been
conspicuous in the items of wheat, flour an'd‘live'

stbck. It is quite apparent ‘that when the lakes
are open, mé"mn'roaa charges are limited by the
water rates. But Mr. Thomson goes f_ur_ther;r he
shows that the average charges on the Pennsylva-
nia Railroad have fallen from 2.46" cents perton
per mile, in 1_'864,.to .1.41f cents in 1'87,3_‘5‘ 80, ‘that
it is a fact, established by oneof the great trunk
lines,'that the rates of transportation are gradual-
ly andisteadily being lowered, land;-that ‘the pub?
lic are deriving the he‘ncflt9o,f.every‘.“new improve}
mentin railroad opér_ation,c."and;in the.,gr,oWt.b.-of
the volume of trafhc.» '.1‘l1is:statementis-corrobor-

.aga:1«by the Report of the Mas's'achusetts'_Railroad
Commissionf ‘whose’, chairman. ,i1'!1}}1'bl,8’ m8.n_,finc ,
“itself, leaves unnoticedthat other-”greI'at -example

1.m.nyfrespec_ts, destroyed mucli of the value of -his

- Report, by interweaving a puerile hobby, borrow.-

nig the habiliments of Herbert Speare}sVEvolution_
Theory, for’ application to‘ railroads, where it has

no sort of propriety. _Nevertheless, the fact ought.
to -be: more widely circulated that_railroad=vfares'

andffreightsare steadily gettingrless; tha=t-com;
petition is keen enough now to giveito. the"pu‘blic
the gmgiiggunivantage which applied science ‘or

‘massed capital can win, ,On the subject of pro-
fits over and above -the actual investment of_cap-
ital, the Report has a few excellentwords :.

The process of “watering” railway stocks-
that is, the increase in_ the capital stock of the
company by the issue of shares unrepresented by

.actual property-—-so much complained of by the

public, is very unusual. Even the increase of shares
made by the New.York Central Railroad Com-
pany, so frequently alluded to, was made upon

the same principles adopted by every merchant if —

at the 'end'of each year the stock of merchandise
he may have had on. hand had materially ‘ad-
vanced in value, as was the case with the real
estate of the company, and the addition to its
works paid out of the netgprofits of the railway.”

President‘ ‘Thomson might have go_ne_further.
He need not have confined his remairksto the New
York Central and his own corporation. In a

. generalway,-what is to prevent theowner of a

railroad from taking advantageiof the rise_in_ value
of his species of,prop'er'ty, and p_uI.ting up its price
in just the same manner as the owner of ‘a farm, a
store or a mill—~no matter whether that rise grows
out of the natural increase in population and

wealth," or throughthe usefof a debaeed currency; 4

from superior foresight or sagacity,’or from any
othercause ‘E Nor does it make any difl‘ereuce to
thepublic whether the ownnrs call the‘ cost of a
road ten or twenty millions; whether the owner}
ship is split upvinto ten thousand-or -twenty thou
sand pieces. If the road is payingdividends-it’ is
because ityisfairly earning them; and if it- is not,
then thepractice does neither good nor harm.
In ‘other words we must stand on’ the’ broad prin-

ciple that railroad transportation likoother pur-

suits isentitled to allit can earn bythe laws of
trade.«..»‘___—- 
This,’ ref_er'en"ce‘to_lthe New York Central ‘loom;
p_any’sTc’a_‘pital ’ account is a kindly mention of 9.
greatrival, or ally; and whiletrueenougb, in

ofdilutedecapital, the New York and Erie'0om-
pany, which has (never derived the first dollar of
-benefit from its enormous inflation ol shares. The
"difference ‘in ‘territory, ingrades, in . management,
and in resources, or-all combined, account for the
different results to the shareholders: -between these’
neigheboring and interlacing lines-_; for .-4.“, stock
watering” does not seem to serve both alike. =