The Wheeling daily intelligencer. [volume] (Wheeling, W. Va.) 1865-1903, 1878-04-04
The Conservative Policy OF the
Baltimore q Ohio Road.

Bultinlore q Vhio kkoau.
Baltimore Sun.
The adoption by the Pennsylvania
Railroad Company Of the resolutions re-
ported by the stockholders committee
10 favor Of the creation Of q trust for the
purchase aud gradual extinguishment
Of the bonded and guaranteed debt Of
the company by setting apart every year
q portion oil the net earnings for the pur.
pose, is, as we suggested in advance Of
any action Of the stockholders meeting,
u step in the right direction. The amount
OF earnings proposed 10 be invested an
nually in this trust fund is two pee cent
upon the capital stock Of the company
This, OF course, means diminished divi.
bends to the stockholders, but Il also
means increased strength and stability
to the company itself and Its stock, as
we'll as to all It's guaranteed securities,
II the trust is steadily adhered to and
faithfully administered and carried out.
Il IL the conservative policy which the
Baltimore aud Ohio railroad has long
pursued, and the merits OF which posi-
bly, a portion OF the community will DO
better prepared to appreciate now that IL
has been deliberately adopted by the
Pennsylvania road on the recommended
ton OF It's president and directors. II 10
nothing more than the application Of the
principle Of providing a sinking fund"
ior the gradual extinction Of the corpor.
ate Indebtedness, which Is adopted in ref.
ereuos to all the public loans Of the city
Of Baltimore, only that in case Of a pri.
yRte corporation, such as u railroad com.
pany, the necessity aud duty Of making
such provisions are far more imperative.
Ia the case Of public Indebtedness which
has to be met, principle aud interest, by
taxation, the principal Of the sinking
fund" besides the increased stability and
value given to the securities, provision
for the redemption Of which Is thus
made contemporaneously with their
issue, has the lnrther recommendation
that 1t furnishes the most equitable
method Of distributing over a period OF
years the burden Of taxation incurred
Tor the common benefit. In the case Of q
private corporation, however, the case Ia
sill stronger, and the railroad company,
for example, which goes on during years
Of prosperity, recklesSly dividing lis earn.
ipgs IN the shape Of dividends, without
making any provision out Of those earn.
ings for the payment Of liabilities TO ms.
ture hereafter, must ultimately pay the
penalty, not only In diminished public
confidence, but in Diminished resources.
All this was fully aud frankly recog.
nized in the report Of the committee Of
the Pennsylvania Company in favor Of
the creation Of the trust. That compa.
ny has done wisely in adopting the re.
commentator Of its president and the
committee. It ia only due to our own
great corporation, the Baltimore and
Ohio Railroad Company, that 1t should
have credit for having steadily and sue.
sesitully pursued through 4 series Of
years the prudent and conservative
policy which the Pennsylyania corpora.
ton has Just now decided TO adopt. Thus,
the city loan TO the Baltimore and Ohio
Company, originally 81 100000, has been
reduced to SS.l46,966 by the growth Of
the sinking fund under thecity'sc charge,
and which at the date Of the last annual
report Of the company amounted 10 81.
96S.421. The sterling loan redeemable In
1895, Of S3,S72000, has q sinking fund
already amounting TO $725,044; the ater.
ling loan redeemAble In 1902 So.8s0.0OO.
hAS q sinking fund OF $50, CAS-: and M.
sterling loan redeemable in 1910, otsame
amount has = sinking fund Of S3S360O.
The aggregate Of these sinking funds Il