Morning journal and courier., 1880-05-24
DNDAY MORNING, MAY 24, 1880.
Monday Morning, May 24, 1880.
THE PHILADELPHIA AND READING
 FATTTRE

I FAILURE.
 Though the collapse of the Philadelphia
 and Reading railroad company and the Phila- 1 delphia and Reading Coal and Iron Company
 is not so calamitous as it would have been two or three years ago, when the business of the country was In a precarious condition, it
 is bad enough, and the results of the disaster
 will be felt for long time.
 l The record of the progress of the two companies towards bankruptcy is interesting and instructive It is also astonishing, or, at least would be, if we had not become ac- customed to similar methods of doing bzsi- ness Up to 1871 the Philadelphia and Read ing railroad did safe and paying business, as it would have continued to do until this day had not the ambitious and over-sanguine managers formed scheme for controlling the entire production of coal from the first and second anthracite fields of Pennsylvania. As the railroad company was forbidden by its charter to engage in the business of min ing, the coal and iron company was organized, and the stock of this company was owned wholly by the railroad company which also guaranteed wherever it could the obligations of the company which it had created, thus placing itself in the position of a guarantor or indorser of the coal and iron company Since the foundation of the coal and iron company enormous tracts of coal lands have been bought with money raised by the sale of mortgage bonds, and mortgage after mortgage has been made until the bonded, scrip and floating indebtedness re- ported by the company last November, was nearly $71, ,000, 900! The interest account has been enormous, and the payment of that in- terest by new loans and by selling coal at less than the cost of mining for the sake of get ting the money could not of course go on forever, and 1t is a marvel that it has gone on so long as it has. For the last five years the crash has been expected, but it seems to have made little difference with the manner of doing business. Indeed, since the first of the present year magnificent schemes have been indulgcd in. Ore banks and furnaces were purchased at Palo Alto, St. Clair, Danville and other places, and new shops were erected at Pottsvllle. number of collieries were leased, and everything carried on just the same as though there full treasury As the notes given for these were for ninety ", and the collapse followed. No wonder that President Gowen's management is severely criticized.
 The collapse of these two companies would be less of disaster if by means of it the monopoly in coal were destroyed and re- duction in it's price effected. But though the Reading output amounted to about twenty-five per cent. of the anthracite production the failure will probably have little effect on the price of coal, unless it is to raise it. We are told that the New York representatives of the coal mining and carrying business profess to be in good spirits, and to think that they will be helped rather than hindered by the Reading companys failure They can be re- lied on to take advantage of it to still further oppress the public if it is possible to do so