The Columbian. [volume] (Bloomsburg, Pa.) 1866-1910, 1880-05-28
READINGS BIG FAILURE.

profound sensation throughout the country, |
In business circles, aud there is
a general desire to know the causes leading
to this tremendous result Very few are
aware of the extent of the obligations of
the company, and the load it has had to
carry on account of the heavy losses of the
Coal and iron company, which is part and
parcel of the railroad organization, officered
by the same men and conducted by the same
direction A brief condensation of its his
tory, capital involved, lands owned, and
liabiiti. =, cannot fail to be of deep interest
at this time, and it is appended from the
most reliable sources at command.
The Reading coal and iron company is
wheel within wheel in the Philadelphia
and Reading railroad company, and Frank.
lin B. Gowen is the president of both cor
porations, while the directors who control
the one have the same supervision over the
other. The coal and iron company was or
ganized and chartered in 1871. Before that
time, Gowen as trustee, had been buying
coal lands, and when he became president OF
the railroad company his mind at once
grasped the details of stupendous enter
prise. This was nothing more nor less than
to have the railroad company become the
owner of the entire anthracite region of
Pennsylvania. The result was that money
by the millions was poured out from the cof-
fers of the railroad to buy the best coal land
in Mahanoy and Schuylkil basins, in the
Lebigh country adjoining the Leghigh and
Susquehanna railroads and Wyoming coal
basin. Mr.. Gowen argued then that COM
pary which had built railroads to the ex-
tent of s30,000,000 and which was to de-
rive its principle revenue from carrying an
thracite coal and which, in addition to this
capita, had guaranteed to leased lines rentals
representing capital amounting to nearly
Sl5,000,0 900, depended for its future pros
perity on its ability to control the products
of the anthracite coal regions of Penn.
sylvania.
To think with franklin B. Gowen is to
act to act is to direct every energy to the
accomplishment of the purpose in view.
This he did. There was no way of removing
the risk of having its coal traffic taken away
from it but for the Philadelphia and Read
ing railroad to buy the coal lands. This was
done. The Pennsylvania railroad was buy
ing coal lands, the Lehigh road was buying
coal lands and the Philadelphia and Read
ing entered the market as competitor. Not
only this, but it became necessary to gain
control of the sections where the Delaware,
Lackawanna and Western railroad and the
Central railroad of New Jersey were extend-
ing their lines and connections so as to be-
come formidable competitors for the coal
carrying trade Of the country. This buying
of lands resulted in an enormous expenditure
| of money. 1t has taken so far from the rail
| road company the immense sum of nearly
| fifty million of dollars. More than this, it
made the Philadelphia and Reading railroad
company the guarantor of an additional in.
debtedness of from $14, ,000,00 to $4,000, 900
due by the coal and iron company to some
of the people from whom lands where pur-
chased. This expenditure represents an
annual interest charge of over $4,000, 900,
which in the recent depressed condition of
the coal and iron trade was a tremendous
| load for the rail road to carry. To give
| some idea of the enormous extent of the ter
ritory and the great ramifcations Of the two
corporations it may be stated that the COM
psnies control area Of nearly one third Of
the 450 square miles OF the anthracite coal
lands of pennsylvania. Few people have
any idea of the extent of the country con-
trolled by the Philadelphia and Reading
road. They have railway of 800 miles in
length, or .551 miles of a single track. The
anthracite coal land owned, is $4,000 acres,
and on the direct line of traffic of the road
there are ninety.seven blast furnaces. Only
half of this number, however, were until
recently run, but numbers were being put in
blast monthly.
During the year 1872, in which the coal
and iron company was organized it expend-
ed the sum of $4,000, 900 under the charter
in the Schuylkill region and had dominant
interest over collieries producing 2,700, 900
tons yearly. The company soon after pro-
posed to the proprietors of the remaining
collieries, which were then producing in the
aggregate 8 ,242, 900 tons, that they should
combine with them and receive certain sum
per ton for their coal, the proposition was at
first res listed, but was ultimately acquiesced
in before the end of the year, and it was
authoritively announced that hereafter there
uynulA ha monthly nf oil thn
producers of Pennsylvania. both corporate
and private, at which the price of coal was
to be fixed to suit their interests. In JAN
uary, 1873, the first Official circular fixing the
price of coal for the month was issued by the
companies in the syndicate, and there was
an average increase in the prices, over those
of the previous month, of about 32 cents a
| ton, and the effect of the late movement to
consolidate the interests of the large COM
panies was becoming apparent in the in
creased rates obtained. The increase in the
price of coal under the combination during
the year 1873, was about 10 cents ton.
The combination was continued with va
rying success from year to year. Early in
the present year the leading interests in the
anth racite trade apparently came to an un--
derstanding in regard to the operations for
the season. The Reading company took the
initiative in movement to restrict produc-
ton in order to maintain prices. The pri-
mary object was to get back some of the
money lost in the fierce fight last year, when,
it is stated, the aggregate loss to the trade
approxfmated $50 100000 and the next con-
sideratiop was to get the trade again upon a
| paying basis. In accordance with this agree
ment, general suspension of mining was
ordered for three days in each week in
March. On the first of April operations
were resumed in full, but at the expiration
of a fortnight return was ordered to the
half time policy, and this has been contin'
\