New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1876-09-08
THE coal ROADS AND COAL LANDS.

ought TO have been as fine property as any IN
the country. Had the demand Tor anthracite
been left free to develop itself i'll harmony
with natural laws, it would have steadily ILL
creased. The traffic of the few transportation
companies by which this coal could be for
warded to consumers would have grown surely,
if not rapidly. 1t was common sense for those
companies to stick to the carrying business,
and leave to other managers and other capital
the risks attending the purchase, mining. and
sale of coal. But the roads were managed by
men who thought it possible to establish and
maintain gigantic monopoly in the coal
business They expended many millions,
and involved their roads in enormous debts,
In order to buy thousands OF acres
of coal lands, aud hoped, by combination and
artificial control of the price, to secure not
only the legitimate profits which belonged to
them rs coal carriers, but great gains by levy
ing a forced tax upon all consumers OF coal.
1t is in this attempt that the roads have be-
come involved in the enormous debts of which
we recently gave detailed account. Mis-
management in other respects has IN some cases
helped to swell the burden. But the increase
of more than eighty millions in five years, IN
the debt of three companies, has been mainly
due. with the increase in the debt or stock OF
other roads, to the departure of the companies
from their legitimate and safe business as
carriers, in the hope of forcing the whole
country tn pay tribute to them as monopollsts
The monopoly broke down, as all monopo-
lies must in the end Hundreds of operators
wanted to share the profits promised by the
artificial prices, and opened new mines. lhon-
sands of miners wanted to share, and insisted
upon higher wages. Millions of CONSUMERS en-
deavorcd to avoid the imposition by using
other fuel instead of anthracite. Then the in
vestment of millions proved Improbable IN
some cases. and in all dangerous, because 1t
invo we'd n burden which the roads, AZ trans
portation companies alone, were utterly unable
to carry The New-Jerscy Central, for exam
ple. has debt of more than 100000 per
mile, stock not included; 10 pay interest on
that debt at 6 per cent, without earning Il
dollar for stock, the road must make net earn
ings of $50, 600 yearly on every mile. This is
| impossible; though the management had been
| perfect, and the business enormous, 1t
would have been impossible. But the
worst feature in the case Is that
when the company's coal lands become I'M
profitable, at that very time, also, its. traffic as
a TRANSPORTER necessarily declines. The result
does not need any defalcation or fraudulent
abstraction of funds to explain it. In the
nature of the case such q company must DO
bankrupt, unless it can realize large profits
from It's coal lands, and the combination has
managed to get the anthracite business into
such state that nobody can reasonably expect
to realize large profits from coal lands at
In cir
tinued low prices will be needed to revive
consumption and to bring miners to acquesce
In lower wages. But no corporation having to
pay $4,000 per mile in interest alone can
afford to wait fOr the slow recovery.
The condition of the other coal roads does
not appear as bad from their official reports,
but it appears bad enough. The Lehigh Val
ley bears debt of about $4,000 per mile,
stock not included, and the Reading debt of
about $4,000 per mile. The latter owns
over 100000 acres of coal land, and mined
| nearly half of the coal taken from its land
last year. It's expenses were reported as 81 10
per ton transported, and its receipts at 81 70
per ton. Its coal movement declined from
6,546,OOO tons in 1928 to 4,363,OOO in
Ia874-5, and the returns for eight months of
| this year show an increase of only 335, 900
tons. Either a decrease in the quantity OF
coal moved or a considerable decrease in the
piofts per ton, without large increase in guam
tity marketed, would bring even this COM
pany into difficulty, for it needs about
So, 900 yearly to pay interest on its debt.
It's net earnings last year were $G,S72, 600.
A decline of IL 80 per ton on the guam
tity mined from the cOmpany's lands would
be about $4,500,000 yearly. loss Of less
than that amount per ton on the coal mined
by the company itself, and loss of less than
so cents per ton on coal transported, would
leave the company without earnings enough
to meet interest on its debt. This illustrates
the difficulty which, in greater or less degree,
all the railroads have brought upon themselves
which have incurred large debts in order to
control the coal production. They risked the
property of stockholders in an attempt to
build up and maintain monopoly outside
of their legitimate business as transpoIters.
For the moment all stocks are in some degree
affected by the disasters Of these roads. But
in the end it will he seen that their disaster or
danger does not extend to other roads which
have not departed from the proper business
of transporters. In many respects, and es-
pecialy in cheaper fuel, other roads are
benefited by the collapse Of the combination,