The morning call. [volume] (San Francisco [Calif.]) 1878-1895, 1892-09-21
"Two KINDS OF RAILROADS"

Under this head an evening contemporary
publishes the following:
C. Z. Huntington is satisfied that the Salt Lake
and San Francisco Railway viii not pay. This
view Is supposed TO be presented In perfectly
disinterested manner. The great railroad mag
nate, of course did not take into the account the
fact that he runs railroads whose business would
be seriously affected thereby. There is one ele-
ment in the calculation which is beyond question
true. The Great Salt Lake and San Francisco
Railroad would not pay if constructed on Mr..
Huntington's methods. Tie accepted plan with
him is 10 load down these iron highways with
debt According TO his practice it does not pay
TO run railroads, but il does TO build them.
When they are plastered all over with all The
bonds they can carry, Huntington railroad has
10 meet the interest on a large and unnecessary
Indebtedness, pay running expenses and earn
something for the stockholders until The receiver,
in due season, puts in his appearance. But there
IS no notion that the Great Salt Lake aud San
Francisco Railroad Is TO be constructed on prin-
ciples OF that kind The object is TO build
railroad and not 10 engage IN speculation. II It
is built aud equipped on al average expenditure
OF $4,000 a mile. which, by the way. are out.
side figures, any fight that IL may have for bust
ness with existing roads will. IN fact be no fight
at all. There can be no sort OF contention be-
tween $50. 600 mile and 500, 600 mile. In
such case the 100000 mile railroad has SIM
ply TO 60 TO the wall, Ia other words to the re-
ceiyer.
Another San Francisco newspaper, the
Rurdl Press, in noticing the Great North
ern Railroad, which ii has been said is
likely to aid California, contains the fol-
lowing:
What viii b. the result? Immediately, il will
depend upon Mr.. Hill. II lie persists in doing
business in fair way; II he stands clear of COM
binations and carries freight az fair rates the
old roads VIII be broken down. Neither the
Northern Pacific. nor the Union Pacific nor the
Southern Pacific eau stand the competition OF
road built and operated on fair business prin-
ciples. II the new company carries out its prom
ised policy. the old lines will get no through
business at present rates; and II they meet the
lesser rates they cannot pay dividends or even
fixed charges The situation IS not comfort
able one for them. They have either TO bribe
II III into cooperation or 10 face bankruptcy
OF course they VIII attempt to seize the first horn
OF the diemma-and there lies the danger 10 the
public. Human purpose is often weak. and Mr..
Hill Is no doubt in The business for what be can
make out OF il. II Is very much TO be feared That
the old rule which declares that "there viii be
no competition between railroads where COM
binatiOn is possible Will again be proved. but,
IN any event the secret IS out. The constrnc-
IiOn OF the Great Northern has demonstrated the
TACT Ihat the ou TodGS represent 100 nlucn moDey :
That they can be duplicated for fraction OF
their alleged capital; that upon an honest basis
of cost and under prudent management railroads
eau proiitably carry freight for one-half 10 one
third OF present rates. With these facts known
there can be but one end. The roads VII, in
time, whether Mr. Hill stands 10 bis fair prom
Uses or not. be put upon an honest basis. The
wateI'-whateyer its S0uree-will be squeezed
cut Of them, and they viii be permitted fair
income upon their actual value, allowing for
reasonable but not excessive charges OF man
agcment Ii may take time TO accomplish this
good result but IL viii come. The time when
the public can be forced to pay dividends upon
frauduleni railway capitalization is passing.