New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1894-08-16
THE RAILROAD SITCATION

=, ,I. natural order OF events under the
,,,ur,,iou ~ the law Of action and reaction, II
snoms oulte probable that there will presently
no an advance In railroad securities In me ihar
ko, There is a very general feeling that DOT
tom prices have been reached; mat 'h' WI y
90 II Is over: That we have struck hard pan ana
that from now Oh there must be revival III o"''
moss Increase Of earnings and advance In prices
The settlement Of the tariff question anu up
nro,cbin. adjournment Of Congress count as
considerable factors In producing 'hiS i''hne'
rb. cessation of strikes and labor agltations Is
another. And In NOR" concrete 10TH '"c i.''
movement in railroad earnings. now that the
monthly statements come IN cohparieo" WV"
,hos, ~ last wear after the railroads began to
suffer most seriously from the business ue-
nrcsslon. is taken as a most encouraging sign
Against thc-.. promising Indications 'n'rr arc
f,ctor. in the situation. by no means unlnpor-
tnnt Of which the wary Spectator VIII ho' loSc
sight. one Of which Is the enormous falling OH
in the Western crops. upon WHICH 'hc graz
railroad systems Of that section are 50 largely
dcpcndcrIt for traffic and earnings IaKihs I'LL
things into account. however. the present out
look SO far juSt,icS the expectation OF improve,
mont that thc conservative observer mny well
consider
element Of danger ,han of hope in the situation
The danger Is thar in the reaction toWaru
hirhcr nrirrs for railroad securities which have
had during the last eighteen months tilhp"
amounting almost 10 collapse. the lessons ~ this
disastrous period may b" forgotten. Tie pres
emf necessity IS lot 50 much that there should
be- n rapid restoration Of lost values ana return
70 high prices ~ thai recovery should hc steady
Al I,.,lt IL
not be- with the continuance Of the methods OF
railway management which have broken down
confidence aud n'ndc such fearful havoc with
thr values The credit and standing Of railroad
securities For a long term Of years In fact,
ever since The rapid railway Development be-
yond The Mississippi began the great systems
have been engaged in mad race 10 cover new
territory. open new fields. build branches in all
directions, and Increase their mileage. Thor" Is
reason 10 believe that In most eases this has
been done. not 80 much with view 10 the III
trrcS,S II stockholders aS 10 promote the anb-
ton of managers and crafty spirit OF reckless
rivalry Competition hls been carried on by
sharp practices and wilful "vaslOnS ana VIOLA
lions Of law. AMI capital has been raised for
building branches and rNi"n-,ons by fictitious
statements. dishonest bookkeeping devices and
gross misrepresentation. From these causes
moro than from business depression or financial
disturbance our railroad securities have been
di-crclltrl AMI he managers diSgraccd.
II j. Idle IT, attempt Ia disguise the facts. The
part "f sound financial wisdom and conservative
good sense Is 10 look hem fairly In The face
Now /, the time 10 do Il. before prices have been
forced up under the reaction 10 n point where
the couu~.l> II ilmldity and The clamor 81 rck-
l,.,S speculation VIII again be- powerful! enough
10 silence" crnsurr md suppress criticism. Three
great railroad systems the Atch!Son. Northern
Pacific AMI Union IIc.iic-arr NOW IN IN" hands
uf receivers aud The control Of the Federal
courts All of them have fallen under The I'M
puinilon If Acknowledgement. Ia all Of them II
In, h",n freely charged that Official misrclr'-
Scutatpns In variouS forms have been rcSorlcd
10 10 conceal from ihrr security holders and The
public the actual condition ~ The companies,
and that upon these misrepresentation Invest
ors have been deceived and public confidence
abu.,~l Efforts 10 rcorganiZc these companies
ar. now IN progress. The proposed r'organlZ-
lions Involve a sealing down in all the securities,
AMI in some possibly The total wiping out ~
ihr stock The LATTER proceeding seems harsh.
bur Is II unlu>tl The management Of the prop
critics has been in The hands of the Stockholders.
They have elected the directors. The directors
have. selected the cXrcuiy" officers ana man
ayers But all protest their ignorance Of any
wrong,l"'ng and disclaim responsibility Who Is
responsible" If they are not II VIII be long
step toward a much needed reform II. before any
~ these r,orsan2atiuns are completed. there he
a thorough ovrrhaulIng of thr books and rec
orls. a tracing Of direct responsibility. AMI after
that the establishment Of the principle TINT rail-
road directors must aclualnt themselves with
the affairs ~ their corporations, AMI he held
responsible for their being conducted with II
rca Soral. degree of honesty toward the public
| and the owners of the property.