The morning news. [volume] (Savannah, Ga.) 1887-1900, 1894-01-20
ManaEsmsnt Of Railroad Finances.

mauARement or Railroad Finances.
So many railroads have gone into the
hands OF receivers within the last year,
inficting heavy losses upon tens Of thou
sands Of people, that the question as to
whether, as a rule, the finances of rail
roads are honestly managed is beginning
TO attract attention. No doubt the hard
times forced some of the roads into bank
ruptcy, but there are others that did not
suocumb 10 the business depression, if the
statements Of their financial condition,
published just before they met with mis-
fortune, are true.
But are the published statements Of the
railroads respecting their financial condi-
tion, as a general thing, truce An i'm
preston is getting abroad that they are
not. Il was believed that the Reading
road was on a sound financial basis until
just before receivers were applied for,
and rumors Of the shalxy condition Of the
Atchison and Santa Fe system begun 10
be circulated only little while before it
went to the courts for protection against
its creditors
There were reasons for thinking that
tho Atchinson and Santa Fe system had
sufficient money to meet all its obligations
until the time was close at hand for the
payment OF the January interest upon its
obligations. The statements of its net
earnings that were sent out showed that
they were sufficient to pay all of its in
terest obligations, and yet receiver was
asked for on the ground that there was
not money enough to pay these obliga-
tions.
What became OF the money the Atchi-
son and Santa F'e earned That is ques-
tlon the security holders are asking, and
to which no satisfactory answer is given
Railroad managers, in too many in
stances, do not deal frankly with their
security holders and the public. BY
misleading kind of bookkeeping they make
a showing Of big earnings even when their
roads are on the edge of bankruptcy.
They seem to think it is their duty to make
it appear that their respective roads are
solvent even when they know that
financial disaster cannot be averted.
1t is undoubtedly true that vast sums
of the money of railroads are wasted by
bad financial management, and that efforts
are made to keep the results of bad man
agement from the public, with the hope
that business will improve and that the
losses will be made up. They seldom are
made up, however, and finally'a time,
comes when the signs Of bad manage
ment canuot be concealed. Financial dis
aster1 comes CLOSE on the heels of conf
dence-inspiring report.
Unless the managers OF railroads deal
more frankly with the public, stating the
whole truth and nothing but the truth
in respect to roads fnan-
cial condition, it will not be long before
railroad securities will be regarded with
so much suspicion that it will be difficult
matter to find a market for them at a
price anywhere near their true value
For the protection of the public semi-an-
nual reports Of the financial and physical
condition Of every railroad in the country
ought to be made by experts having no
connection with the roads and in no way
under their influence, and there ought to
be law in every state furnishing severely
railroad managers who allow reports of
the financial and physical condition of
their respective roads that are false or
misleading, to be published. 81 .-