The Wheeling daily intelligencer. [volume] (Wheeling, W. Va.) 1865-1903, 1883-07-18
MORNING, JULY Is. 1888.
wRECKISG RAILROADS.
The PastIme or InhnentiaI Citizens
How it Il Done.


PHILADELPHIA, July ia New YorE
correspondent of the Pres had an inter
view with a railroad builder about the i'm
possibility Of constructing railroads ir
these days on a square basis. Speaking o
wrecking roads, the gentleman said: "The
most recent and notable case can recall
ia that Of the Richmond & Allegheny. Il
runs from Richmond, Va, and connects
with the Chesapeake & Ohio at Clifton
Forge. 1t is 250 miles long and traverses
one OF the most beautiful and fertile sec
tions Of the Old Dominion. 1t follows the
valley, skirting the James River nearly all
the way up, past Lexington, KY, and the
Natural Bridge, where it has connection
with the Shenandoah Valley railroad,
North and South. Except railroads built
on the prairie, It cost less to construct than
any line in this country, and 1t now goes
int the hands OF receiver because Of the
Encouragement OF its finances"
EThere were only two bridges to build
in 40 miles, and in an incredibly short
space Of time they had railroad built,
having easy grades, aAd ought to have had
no debt to speak Of. The line only cost
S3,OO0,000, or about $4,000 mile, and
started with the brlghtes: prospects"
WATERING IT'S STOCK.
"How, then, could it be wrecked?'
"very easily. It's the same old story.
About the time of its completion an inves-
tigation OF its financial affairs showed that
the company had already put out s., 900, 600
in first mortgage bonds, and S5,OOO,OOO of
stock. In other words, the financial
manipuatiors have created debt OF over
SlO,OOO,00O upon a road that only cost
About this time, these people
proposed compact OF consolidation with
the Ohio Central, a road that runs from
Toledo, Ohio, to a point near the Ohio
River. This was the seaey syndicate plan
of operations"
"Were Blaine, Mccullough, etc., party
to this Arrangement"
''N0, sir; when they saw the drift Of
things they left the directory and got out
of the road. think Mr. Blaine made about
100000 out Of the speculation, but twas a
legitimate transaction. He was in at the
beginning and as long as everything was
square, but when he found how the road
was being watered he refused to be party
to it and quit, so did Mccullough and 9th.
ers. The stockholders OF the two compan-
les, the Richmond & Allegheny and the
Ohio Central, then put up S5.000,000 more
with which to connect the two lines. Ex-
tensive works were started at Richmond
and Toledo and the most reckless financial
management INDUCED in.
IN THE Tolls.
"Finally it BECAME convenient for the
syndicate to squeeze the Richmond and
Allegheny. The OHIO Central, which
meant Seney, and the New York Metro
poiilau Bank crowd had induced the Vir.
ginia road TO give its note for million OF
dollars with $4,000, 600 Of second mortgage
bonds as collateral, on account Of these ex-
penditures in Richmond and Toledo. The
Ohio Central then broke its contract OF
consolidation, the note fell due and the
Ohio road, II course, gobbled $1,000 900"
"Did this end the manipulation"
"0h, no. Under the boom for which the
contract OF consolidation WAS the pretence,
Ohio Central stock was carried to S6, Rich
lnond and Allegheny to ~, and at these
figures loaded off upon unsuspecting
parties" =
s'sHow could this be done?"
"The success OF the Seney syndicate with
the Nickle. plate road, where they made a
great deal OF money for themselves and all
who were connected with them, gave the
people great faith in what they called the
lucky star Of the Metropolitan Bank 1t
has been mighty bad luck for those who
putconidence in these financial agents.
Their voice in these enterprises has lasted
Just eighteen months, and Ohio Central
has gone from 36 to 9, and Richmond and
Allegheny from 72 to st, the Richmond
and Alleghenys frst mortgage bonds to
II, and the road is practically bankrupt
and in the hands Of receiver.