The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1854-08-29


he works particularly railroads, u BY no means oai-
culated to give thoee interested a stockholders
much confidence IN The success Of the several com
psDies. After I'll the losses, all the srpost Of extra.
more care lie not taken IN the selection Of members
Of the boards Of directors. Millions upon millions
OF collars are entrusted TO individuals who hold
certain position tn society and have the reputation
the first thing the stockholders know lie, all the
funds are gone and the work in contem olasion but
partially completed. Scores of cases Of this kind
have. Occurltd and It u strange that with
years there is no PROBABILITY Of revolution
In the system Of railroad management The
most recent instance OF gross Encouragement
In one Of our most important publ works, u thai
have pointed out some Of the items in which an enor-
nous amount Of money has been expended, Tor
which there Is nothing 10 show. We have sh)wn
that nearly ten millions Of dollars have been ex-
Of road, and have also shown that the company vas
hopeessly insolvent that the next seni.annual In.
erest on the Indebtedness could not be paid out OF
the earnings Of the road, and that there vas every
in 1874. All tlese things We have shown conclu-
sively, and those who are still incredulous, w BE-
fore the lapse OF many months, be satisfied OF the
truth Of our remarks. This Is truly an unfortunate
power to encourage the construction Of thus work.
When the books for subscription to the three mil
lions OF stock were opened, we urged the pubic TO
come forward and I'LL up the amount required, be.
heving then, as we do now, at the completion OF
the road would be of the most vital importance to
the people of this city, and the southern tier
u ties in the State and 1t was with the creates
satisfaction that we saw the books filing mp "a
idly. Wien the three millions OF dolla were
obtained, and work on the road commenced, it
was the universal impression that ia few years
the communication between the Hudson river aud
Lake Erie, through the southern part OF the State
hn atAA rsf ha
the enjoyment Of all those advantages 80 long ap
tcit ated nom such connection. TIE three
millions were spent, and three millions were
raised by the sale of bonds, WI ich have
reached the shores Of Lake Erie, it has not been
completed half way. 1t may well be asked whatt1e
cause of this delay is but It is question exceed
ingly difficulty to answer. The principal cause Is the
exhibited on the part OF the directors in flu filing the
trust placed In their ban Is. When it ID considered
that many of the managers OF this road, under the
new organization OF the concern have been engaged
made fortunes out Of all the exploded companies,
which have been SO numerous during tse past ten
or fifteen years, even including the celebrated Kidd
company, of Dnncerhead Mountain, 1t is not so
astonishing that the resources Of the EIe Railroad
Company have been exhausted on QUE hundre d aud
f0rtysix miles of road. The same financial talent
that regulated the affairs of the Morris Canal and
Banking Company, the North American Irnst and
Ba, king Company, the Kidd Diving Company,
and several Others OF similar character, has
been visible in the management Of the Erie
Railroad Company; and unless something Is done TO
bring more actical men into the direction 1t Will
soon meet with fate similar to that realized by the
other companies. While we attribute the baak upt.
cy and insolvency of the Erie Railroad Company to
the extravaganza and ignorance of these who have
managed its affairs, we condemn the course pursued
by those directors who have quietly looked on and
made effort to arrest the movements Of their CO...
leagues, who wee so rapidly running the credit Of
the concern. These individuals have permitted
their names to be used for the purpose VI giving
character TO the board and creating public conf
dence in the management, and they a.e Therefore
equally amenabe to the stock holders for the depre
citation in the value Of their property. II is our
purpose to point out the most prominent items Of
extravaeance in tie expenditures, and to show to
the stockholders that the remedy is still in their
hands to save the concern from utter and complete
prostl ationa prostraton that will require years to
remove. Tie history Of this road Is only another
chapter in the great book Of bankruptcy which has
be nearly filed by companies which have failed
within the past fifteen years.
From the Herald, Jan Q, 1919
On the authority OF public notice relative to the
formation Of railroad iron manufacturing company
n Pennsylvania, and the announce ment that sevs-
rsl directors Of the Erie Railroad Company hal be-
cone la gely interested la the conce n as special
purirers, and with he knowledge that heavy CON-
tract had been made with the iron company by the
railroad company, We awaited Ourselves OF the 0c-
cDsioD to condemn the CT urse pursued BY these nd
viduals while connected with the railroad company
as directors, having the pc wer to make SUCH con-
IT, cts 80 they please 1t appeals that the company
agreed 4, loan the general partners OF this iron COM
pany the sum Of ore hunGled thousand liars, at
the tine the contract for the manufacture of ten
thousand tons Of iron was made; but Ia consequence
Of some disagreement in tho board, il refused when
the amount was made up by five or ak Of the direc
toGA For the purpose Of placing before those In
terestcd every thing relating to this matter annex
statement from party connected with the rail-
road and the iron company. There are always two
sides to every story and we are disposed to give all
an opportunity TO vindicate themselves, II possible:
NEw York AND ERIE RAILROAD.
Soon after the Erie Rsrcat Company had put their
road under contract to Bnghamton, they began to
applied to eli tie manufacturers in this country, and
to the agents and importers Of foreign iron, and the low
est oasr they had from any party was $40 cash deli.
Continent and for English and American railroads.
great that the impression became general that the
and that prices, though very high must still further
advs nee; and the company urged by many large
stockholders to make early contracts and 1t was under
n.y. Hartford and New Haven the Utica and Schenectady
Camden and Amboy aud other railroad companies, made
sS !. ,0T the Ssx Yoe lS1 %
this time they closed contract With Messrs Scranton
Platt, wboss works situated In the valley Of the
Iackawana which conld be reached at several different
points the road at about forty miles distsnt These
gentlemen were strangers to the company, but from
tne'r peculiar position, they could afford to deliver
the line Of the New York and Eric Railroad less than
they could in New York, and the very secluded and
difficult situation Of the road made the cost Of the de-
livery from New York very heavy-in some places $40
to &12 per ton. he company, therefore, considered
fortunate in cosing contract for TOMS
to be delivered on the line of the road After making
efforts with other companies and the then cost Of i'm
portation being fully $70 they received from Scranton
PlAtt . proposition that II the New York and Erie
Railroad Company would advance them the
tract TO be expended in enlsrg ng their works.
they would give mortgage all their property then
valued at Sl6C Geo. and also satisfactory personal
risy OF gentlemen Of known wealth In this city, and
would make and deliver ten thousand tons the line
Of tho road Of an average price OF $67 As this would
save the company In the cost ana transportation Of
the iron at least sly per ton Il was strong In luce
ment; but the Board declined the proposition but
the offer being much better than vas received from
any Other quarter, being saving Of $50 to $4,000 to
the company, several gentlemen connected with the
Eoard and other stockt olders undertook TO furnish
the money loan, having the privilege Of taking
interest In their property, II, on examination, they
elected TO do Tbs was explained after in the
PAPERS in the announcement Of the contract and the