Fort Worth weekly gazette. [volume] (Fort Worth, Tex.) 1882-1891, 1888-02-24
ALL IS VANITY.
A Former President of the Reading
Railroad Tells How That Company
Pays its Dividends.
TIE Congressional Investigation Com
mittee Inquiring Into the Strike.
In the Hands of Receiver.
Powderiy Denies the Romors That the
STRIFE Wil be Declared on by the Ex-
eoutiVs Board of the Knights.
THE coNGREss1oyA1 INyEsr1cA11oN


PHILADELPHIA, Pa, Feb. 17-Ex-
President Charles E. Smith OF the Resd-
Ing Railroad Company was the first wit
ness examined this morning by the con-
gressisnal Investigating committee, which
is inquir.ng into the strike on the Read
ing Railroad system ard in the Goa
regions. Mr.. Smith said that he had
been president Of the Reading Railroad
from 1861 to 1869, and director until
1876. He resi2ned lis dictatorship be-
cause he discovered in 1876 after inves-
tigation that the company was publishing
false reports and cooking up its &C,
counts in the interest OF stock
gambling. II the reports the truth
was suppressed. The floating debt wss
not reported and while the road was not
esrning any money it was paying divi-
dends on it's stock which was accomplish.
ed by borrowing money. Some OF the di.
rectors were gambling In stock. Another
influence which impelled the mansge-
ment TO pay these urearned demands was
vanity. The object OF the gambling d.
rectors Was plumber. The company he had
found had borrowed $4,000, 600 to pay
uAu NV DGSu ShIHSu.
Smith said that the rAilr- ad company WAS
managing the coal and iron company
at same time and he proceeded to
explain how the railroad company had
obtained possession OF the mining COM
pany. He said that the latter was viz
tually creature Of the former under the
presidency OF Mr.. Gowen. The original
charter OF the mining company was OBJ
tanned under the title Of the Laurel Run
Improvement 11d Mining Company. The
bill had been put before the Legislature
in that name SO that it
WOULD NOT BE KNOWN
as the Reading bill, but as soon as the
oil passed Its name WAS changed to the
Reading Coal and Iron Company. There
WAS no stock issued until the name was
changed and the Reading had control.
"Is there any law" asked Chairman
Tillmsn, (Which gives the Reading Rail.
road Company the right to mine coalP"
Witness: mo, sir. But they do 1t
through the Coal and Iron Coppany7"
"Wen, is there any law to enforce the
state constitution which forbids this2"
"No, sir"
Chairman: "rhat, suppose, Is because
the railroads own your legislature. Does
the present stock and bonds Of the Read,
ing road represent money sctually paid in
on work dOne?"
The witness replied that the company
hsdHborroWed $4,000 900 to pay divi-
dends which were not loant d; 10 facl
gave money away. Tnis loan YVES Sc
cured by some of the bonds, and these Sc
curities did not represent anything except
STOCK gambling operations.
"Thep," SAID Casirman Tillmsn, "Is
not the company in arranging its business
80 as to meet its interest obligations and
its expenses, charging the public to pay
interest on money which the company
never received ard which was used to
foster vanity and gambling? And is it
from the miDers7"
Witness said that he suppe sed that was
true.
catering into details of the compsny's
property the witness said that in 1869 the
company was doing profitable business
and was perfectly solvent, and paid 10
per cent of earned dividends and inter-
est on its debt, which was less than SO,
00o, 900. How then has 1t happened that
this present enormous debt Of $3.50 ,000,-
009 mas since been accumulated and the
road sent twice into bankruptcy?
"By dong losing business and Dor
rowing money right and left. The nature
of the ccmpany's business has been
changed. Accounts have been cooked
and debts concealed, and the character OF
tran sections have been altogether revolu-
tionized."
Chairman Tillmsn-"A sort of wreckipg
businessH
Mr.. Smith-"Well, reckless business,
certainly"
Witness was then asked 8 number of
questions lesdingiup to an expression Of
HE opinion as to the ability Of the Read
ing Company to pay its enormous debt
and the value Of its securities. He re
piled finally: al Woold not own dollars
worth OF It's bonds, except very early
ones. The others are worthless. The
company cannot, in my opinion, pay its
debts"
When asked further as to whether he
thought the rosd would go back into the
hands Of a receiver, he said: eyes, and
that Will happen at least within year,
from present indications"
WILL NOT BE DECLARED OFF.
SCRANTON, Pa FEB. II Mr.. PoWderly
says the report that he and Lewis, na
tional master workman Of the nattonal
district had decided to declare the Read
ing strike OF is incorrect. The strike,
nc says, was discussed by them, but Mr.
Lewis principal purpose In coming here
was to have Secretary Hayes stterd to
some routine matters. Lewis, however,
before leaving Scranton this morning for
Philadelphia, told an scqusiotance that
ne WAS going to SchuylkiIl county right
OF, and would order the miners back to
work.
TO BE DECLARED OFF.
louisville, Pa, Feb. II Chairman
Lee sends word mere from Philadelphia
that the whole Reading strike is likely to
be dec sred of and ended within twenty
four bours. The joint committee in ses-
sion here declare there is big change
nesr at hand. Secretary Duffy on COM
ipg out Of tue committee roo.ns said; al
cannot give you details, bat this strike is
now TO be settled in short order"
AUSTIN CoRBN's INFORMATION.
NEW YORK, Feb. II MIR. Maxwell, Of
Austin Coroin's Office in this city, said
this afternoon: "We have received q
brief message from Philsdelphis to the
effect that the strike is ended. This is
al we know about it.. Mr.. Corbin has
act supplied us with psfticulars."
- 0onsumptisn surely Cured.