The Tipton advertiser. [volume] (Tipton, Cedar Co., Iowa) 1856-1962, 1873-11-20

mile, according to the last report, wa
2.35, while the latest statement W,
have found Of the Chicago and Rock
Island was 2.65, Of the Chicago, Bur
lington and Quincy, 24o, and of tn.
Illinois Central, 2.32. Certainly these
figures do not show that the watering
OF stock has caused the roads addicted
TO that practice to charge higher rates
than those which have never INDUCED
/ therein.
l Again, If watering stock causes high
er rates II is reasonable to suppose that
the rates must be higher after that per-
formance than they were before. Rut
the New York Central charged an
average rate of , SO in 1862, aud AS In
1865, 300 in 1866, 10 in 1867, and O. "A
in 1868, before the stock was watered,
and has since that operation reduced
its rate to | "a per ton per mile. The
Erie charged $50 per ton per mile in
1851, and 249 in 1867, but since Gould
4 Co. have spilled water into its stock
has reduced its rate to as per ton per
mile. These comparisons might be
extended indefinitely, but the figures
already given, for some Of the roads re-
garding which the complaint Of stock
watering has been loudest, suffice to
prove that the pretense that water in
stocks has caused high rates for freight
is cheat aud fraud of the most bare
faced description. The practice may
be pernirions il may be the means Of
perpetrating some of the worst swim
dies on the Stock Exchange we do
not say ii is not But we do say, and
the facts prove that it has nothing to
do with freight charges. And the peo-
pie who say .ha! the Squeezing Of wa
ter out Of the stock will bring lower
rates are simply trying to stun inno-
cent readers with preposterous non
sense.
What is called watering Of stock
may be perfectly honest and legiti-
mate operation, or it may not. If the
increase of stocks truly represents in
creased capital actually expended in
improving, extending or repairing the
road, it is legitimate. For example.
road which has cost S50, 900, 900 up to
the present time, and is earning a
handsome dividend on that sum, finds
it desirable to purchase branch or
extension, or to lay down another
track, or to put down steel instead of
iron rails, or, after Nanderbilt's latest
plan, to put down two or more tracks
with steel rails for freight exclusively.
To do so large additional expenditure
Of money is necessary. Perhaps it may
be taken year by year from the divi-
dends earned, or perhaps directly from
the pockets of the stock kholders: what
is the difference? In either case it
represents so much more Of their mon.
ey which they honestly invest in i'm
proving their property, and cores
ponding increase of stock is not only a
perfectly legitimate mode Of allowing
them proportionate profits upon their
larger investment, but it is by all odds
the most honest mode of adjusting the
matter On the other hand when a
clique in control Of railroad and en-
gagged in speeulating in its stock, issues
large amount without having ex-
pended or intending to expend the
proceeds in actual improvement of the
property but merely to enable the
clique TO swindie somebody i'm Wall
street, that Is gross fraud. But what
has il to do with freight charges ?
Does anybody imagine that because
road increases its stock from $50 ,O00,-
900 to SAC, ,000, 900 it is bound to earn as
large dividends on the $40, 900, 900 as
on the $50. 900 600. and so must douhle
its charges? That seems to be the
blundering notion of some people. but
the facts show that it is not the actual
result, and any reasonable man ought
to know that, with roads controlled by
IA largely as our chief
roads are, that could not he the result
II Col. Scott chooses to earn IT. per
cent. on stock of $50, 900 900, while
Vanderbilt chooses to earn per cent.
on stock OF Slo0, ,000, ,00o, whose bust
ness is it Their freight charges are
substantially the same. One chooses
to keep his stock out Of the market,
and tho other to keep his stock on the
market. The difference is of some
consequence to investors or specula-
tors, but Of no consequence at all to
shippers or passengers = Missouri Dens-
0cr0f