Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1875-06-19
THE PROBLEM OF CHEAP TRANS.
RRRRhTVnE

anu consumer IN the way OF cheap
transportation. Naturally. the railroad
| problem occupied a large share Of his
attention, and he attributes extor6on-
ate rates to the very modern practice
Of watering" stock more than to all
other causes combined. Among the
larger and controlling lines Of
the country, this process has gone to
extreme lengths. Europe has nothing
to compare with it, owing to the fact
that most OF the railroads there are
owned by the government or are di-
rectly ameDable to its control. In this
country, the process Of watering"
was first ventured upon cautiously, in
small proportions, and with some show
Of reason and propriety. Ii has made
its insidious way under cover Of the
difficulty experienced In keeping sepa-
rate the construction accounts and the
ordinary expenses of railroads.
Within the past few years, it
has grown to proportions that
demand scrutiny, and oftentimes
the seYerest condemnation. In its
worst form, watering of stock is done
by wholesale valuation Of a road and
| its equipments at,a season when an alb
norma! condition Of prices exists, show
ing a large increase over the original
cost. This apparent or temporary in
crease is. boldly and unscrupulously
converted into stock and IN that 70 m
distributed as a sort Of di, idend
among the stockholders. For ever az
ter, the efforts of the managers are
sedulously directed to the attainment
Of the highest possible charges, in or
der TO pay full interest and dividends
on this fictitious stock in addition to
the original and actual inves ment.
The initiation Of irredeemable pa
per since the war Las been
peculiarly favorable to this process
of initiating stocks, if it did not actually
give rise to the system by affording the
opportunity for its practice. In regard
to the means of remedy, President Fra
ley's remarks are so pertinent and
opportune, that we cannot DO better
than give his own language:
Upon the remedies which may re-
move existing evils, IN so vast and COM
pEcated a system as that # our rail-
ways, with 50 many innocent people
| holding investments IN the stocks and
/ loans of the companies, 1t viii be found
very difficult to get Congress, the
Legislatures of the several States, or
the public, TO agree to and apply ade-
quate remedies for the existing evil
Some imagine that Congress, by the
use of its rights of eminent domain, and
of its power 20 regulate commerce, may
take possession Of the entire railway
property Of the United States, pay a |
proper valuation for 1t, and estab- !
fish a general system of manage |
mut and regulation that shall |
furnish the public with transportation
at cost. Any organization intedded |
for such service would speedily reek |
with corruption and favOritism. The |
safeguards of individual interest and |
responsibility would be wanting, and |
the despOtism Of such a management /
would be infinitely worse than all We |
suffer now, but as these railways are !
all public highways, and managed by /
the corporations created by the States, |
]
chises to the exercise Of the right of /
eminent domain, they are undoubtedly |
amenable to State Legislative control |
and regulation, and can fairly be dealt |
with under wise and efficient laws We |
have begun TO know and realize /
the extent and nature Of our grew /
ances, and earnest and thought /
full minds are everywhere at 1
work on the great problem. As /
a further measure Of reform, the an /
nual reports Of the railway companies !
should be rigidly scrutinized, and If /
IN any caseit be found that the amounts 4
charged for construction or equipment 1
have been increased, proof should be
made that such increase has been made |
for new property acquired, or for addi-
tiOnal new tracks, or new and necessa-
~, or for additional supplies of new
engines and cars, and that these have !
been no mere substitutiOns IN any case
Of new for old. And more fully to
guard against frauds and falss entries,
actual inventories Of the property
should be furnished and proved, and
no reliance be placed on mere book en-
tries. It would be a wise and salUtaTy
movement if all the Indebtedness
Of railway companies could be
converted into stock. The complex
and diverse interests that are created
by mortgage piled on mortgage, and
the conflicts which arise among cred
itors when a company gets embar-
raised, tend to enhance the cost Of
transportation, and these events are
increased by the establishment Of sink
ing funds, so called, u pay off debts.
Finally, the most effective remedy for
the existing evils of railway charges
will be found IN the increase of pOpu-
lation and the Investigation of the
employment Of the people These viii
create home markets for the farmer
and planter. Producers and consumers
viii be brought close together, and the
tax Of transportation viii practically
die ont. We have reached this condi-
ton already In some Of the States, and
it is destined to spread.
-~S-
BOSS TWEED's RELEASE.
The silence of the telegraph during
the past three days concerning The
Tweed case, does not reflect much credit
on the management Of the Associated
Press, although, Of course the formal
proceedings necessary to remit the de-
cisions of the Court Of Appeal through
the several courts below, explains the
delay in the actual release. The real
defect in the prosecution that led to
the sentence which is now overturned,
appears to have been that the Boss