Shepherdstown register. [volume] (Shepherdstown, Va. [W. Va.]) 1849-1955, 1889-07-12


really in n double trust-first, for the
private interest of the owners OF the
road. who had furnished the money
TO build and operate il, and secondly,
and in no subordinate sense, for the
public at large, to whom they owed
Just. equal and impartial service in
return for the corporate franchise,
the right of eminent domain, and the
control Of what was in law a public
highway. They universally failed or
refused 10 recognize the latter trust,
and they were too often faithless to
the former.
In other words, they universally
disclaimed their obligation OF equal
service 10 the public, and they often
perverted their control OF the great
properties they managed TO their own
personal enrichment.
HOW THKY GIT RICH.
Men have frequently wondered how
n railroad manager on his official sal
airy could suddenly grow into mil
lionaire. The secret is largely in the
device Of the subsidiary corporation,
or as a recent writer, Mr.. Bonham,
! in his excellent book on industrial
Liberty" calls il, the parasite cor
poration" In the era OF railroad
building the subsidiary corporation
took the contracts for constructing,
equipping or otherwise supplying the
road.
Ii was composed OF the railroad
managers, with enough associates to
act as its officers. Stripped OF all dis
guise. the transaction was one In
which the managers used their posi-
ton To enrich themselves by favored
contracts. This scheme was brought
TO the attention OF all the people
when the connection between the
Credit Mobilier and the Union Pa
cific Railway Company was discov-
cred, connection which Mr.. Hoar,
OF Massachusetts,. doubtless had In
mind when, as a manager on the part
OF the House In the Belknap impeach-
ment trial, he said: when the great
est railroad OF the world, binding to-
gether the continent and uniting the
great seas that wash our shores, WAS
| finished | have seen our national
triumph and exultation turned to bit
terness and shame by the unanimous
report OF three committees OF Con-
gress-two Of the house and one here
that every step OF that mighty EN-.
terprise had been taken In fraud
And Mr.. G. +. Adams, with less rhet-
oric but more information, declares
that the general railroad manage.
ment was fairly honeycombed with
jobbery and corruption. They began
high up In the wretched machinery
OF the construction company with all
its thimble-rig contrivances to effect
the unseen transfer OF assets from the
treasury Of the corporation TO the
pockets OF its directors. Thence they
spread downward through the whole
system OF supplies and contracts and
rolling stock companies" The sub
sidiary corporation once invented
and It's wonderful capacity for divert
ing company assets into the pocket
OF the company officials. and making
millionaire managers, while stock
holders and bondholders vainly walt
ed for dividends or interest, ltfollowed
the railroad corporations In all their
developments, extensions and strug-
giles.
have already alluded to the gross
discrimination made by the railroads
between competitive and non.compct-
i've points. For such discrimination
they pleaded the pressure OF compe.
tition. But they further and every
where claimed the right 10 discrimi-
nate between individual shippers and
between localities. According TO
their ideas OF interest, or out Of sheer
favoritisrn or the reverse, they con
demned one locality or shipper 10
ruin and proverty, and poured into
the lap OF another wealth and pros
perity.
They claimed and freely exercised
what old John Taylor, Of Caroline,
once called ''the worldly onnipoteDce
OF dealing out wealth or proverty,"
and in 80 doing did not omit to deal
out wealth 10 themselves, through the
subsidiary corporation, which now
appears In the guise Of mining,
manufacturing or other like Com
pany.
To the credit Of the managers Of
the Baltimore and Ohio Company II
may be said that they alone perhaps
OF all the great railroad companies
did not use the device Of the snbsid.
iary corporation for the purpose of
their personal enrichment, but man
aged their road In the interest Of it,
stockholders, although they laid the
heavy hand Of discrimination on the
local shipper and too often measured
the charges not by the rule OF equity
or equality, but by what "the trafiic
could bear"
THE TYPE or THE SYSTEM.
To make application Of this seem
ing depression from my subject ! will
conclude this paper by saying that
have already spoken Of the railroad
pool as suggesting the pool Ia other
branches OF industry and Of the latter
pools as foreshadowings or less per-
fect developments Of the trusts. The
committee OF the New York senate In
its report above alluded TO says OF
tt,a Starae "A OiI trust, ssThfs A the