The sun. [volume] (New York [N.Y.]) 1833-1916, 1876-08-27
THE COAL TRADES PLIGHT.
CONSEQUENCES OF THE BREAK IN
THE GREAT COMBINdTION.
The History aud Present Condition Of the
Rivalry between the Companies Ex-
citemept In the Coal Producing Regions.


breaking up of the coal combination is Intense,
though such an event has been looked for for
soms time by those well verscd in the trade. IL
was foreshadowed In THE Sun months ago, and
the wiseacres who pretended to be better In
formed will now have chance to explain away |
their standing announcements OF the perfect |
harmony In the Ring. Ii Is "a yet too early to |
state precisely the effect this smash up will have |
on the coal regions but things cannot be made |
much worse than they are now. The consumers |
will have cheaper coal, that Is certain and the |
impetus that will thus he given to the trade will
result In steader work than would have been
the case with tho combination intact, aud ar
bltrarily regulating the trade heretofore 1t
stands to reason that there will be more coal
sold when 1t Is 81 or $3.50 ton than at the COM
binaton prices Of $3.50 to $3.50.
II has repeatedly been said In THE Sun that
Col Tom Scott and Judge Asa Packer were the
cut worms of the combination. These state
ments are now verified In every particular. When
II was announced that Judge Packer had agreed
to the combination terms THE SUN pronounced
II a sham. such 1t indeed But Packers
Lehgh Valley Company was not the only one
that desired the combination broken up. Mr..
Gowen too has for some time looked upon 1t AS
losing arrangement. Hence he had everything
cut and dried for the meeting this week. II has
been but seldom In the history of the philadel-
phia and Reading corporation that the first six
months of year has shown any balance In favor
OF the dividend account The long strike Of
1875 compelled Mr.. Gowen to draw upon the re-
serve fund, which was at the beginning OF that
year sgB 49, to pay the dividends In January,
bringing that fund down to $65,i53a. Nor has
II been augmented since. so severe was the
drain upon this company from the beginning Of
1873 that while the profits for the first six months
OF the present year are s2iG,,lO34i In excess of
tho profits for the same time last year II has
not been able to pay July dividend. or recover
any considerable reserve fund
that The proats 81 the Coal Company for the arst
i've months Of this year are only Sbb,bkllj great
er than they were last year, when no work at all
was done during the corresponding months
Hence 10 Is evident that 1t made little difference
to the cxchequer ~ the company whether the
production and tonnage were running up
the figures ON the wrong side OF the
ledger, and II became equally certain that
with those restrictions continued the bust
ness ~ the last half Of the present year would
not be sufficient To- extricate the company from
its financial dilemma; It's allotted share of the
total supply Of ten million tons was 2,Ju,Go, and
unlc,, the market would take more han the ten
million tons Il must stay within the above figure.
/ Up to Aug. l. II had already shipped 2.ei,s7j
| tons, or 2jS.Nil tons more than to the same time
last year, and only l.5s2 tons short oi It's total
annual quota, with four and a half months of
the year before II, a lost reserve fund, and no
! provisions Tor tne dividends. and with no pros
| liked minimum Of llOn.OJ tons.
| This was no hattering prospect, and no won
der that Mr.. Gowen became anxious 10 throw
OF the yoke Of which he was the maker, and
| trust To the effect competition and cheap coal
| will have upon the market TO improve the
! finances Of his company The Philadelphia and
Reading Railroad Company is guarantor Of the
to sGO.DO,OO. Its own debt Is large, aud the
| policy II has always pursued OF goe6ling up
| every contiguous railroad that could In any
way compete with 1t, or serve as feeder for
other big roads, has loaded II with anumber Of
roads and canals that are constantly draining its
treasury cad Of adding To it. 1t operates nine
teen such side concerns, many OF which entail
an annual loss The loss on the SchuylNil Canal,
| road In lisa was SptO.acd.Gl. These elephants 1t
ssarss along I"T We sole RIrh1,n o, re,a1ns
and the shipments therefrom. Out Of l,tdJ miles
OF road operated 10y the company rs are owned
| by IL. In ls,3 before IL had assumed very much
OF the debt of the coal concern its capital stock
aud debt amounted To s15,OoO.hb.ib, making
each nlle OF road. single track. represent cost
OF s9el4i.J0. The cost OF construction and
equipment. including real estate. &c. Is put down
at $+5.3lg.jts ~ showing that the stock and in
de6iedness are s.. ss u in excess Of the cost
fthe road. but the stock and debt at the present
Of dollars. and Mr. Gowens contract cnmpels
him to squeeze out dividends amounting to no
less than $4,000 and interest amounting to
| $3osLOcO more, making In all s7,Un,DO annually.
This Is an item not 70 he sneezed at, and II the
e., liz, 1854 excess Of profits Of the FIRST half Of
serve or dividend fund. where would he md him
self At the end of a year II he was compelled to
| the combinations This would compel him To shut
down the Schuykill coal region for the greater
| season. losing the trade for the road besides.
| ny studying these facts the general public will
be ahle to see through his adroit management
| in shaping things first with those Of his COM
binatiOn friends who could be trusted, and then
going Into the meeting ON Tuesday wth set
OF resolutions that throw the odium ~ bad
faith upon Judge Packer.
II appears now that while Mr.. Gowen has his
hand 10 this smashing up business he is going 70
finish the job Two years ago he invited the in
dividual operators to pool their coal along with
sether Many 81 them, taking ii more as a COM
mand than all invitation. entered the pooling
Advancement; whils others were forced IN by
willing to keep them under his fatherly protec-
tion l. seen 10y the following order issued to the
individual operators ON the I'D inst:
receive after to-day.
This will have a bad effect uron some Of those
individuals, while Others would only have been
too glad to have been relieved OF their engage
ments long ago. They are now al liberty Ia
seek their own markets and those who prepare
special Goals will find plenty Of buyers. should
however. n coat war take place many OF the In
the pressure nf the large companies. Such a
war will also result In the smashing up Of some
of the companies, and in that event Cot Tom
Scott and Judge Packer will before year passes
over our heads be the lords Of the coal fields
They hold the winning cards, aud have been
Coal Company has quietly entered the Held
under the fostering care OF the PennSylyanis
chucklng over the discontinue OF the other
coal bar9ns, and he Is making ready 10 peace
s sr s"e iP s sns Sne "H m cIpp s
Reading road, which could easily be made a
through route 10 the West, and would have
been made 50 long ago was 1t not that the entire
attention and resources OF the company had tC
be directed To the coal interests.
While the report 81 the combination crash has
created considerable excitement among tn,
business people Of the coal Tegi9ns, the miner
think that change in the management