The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1897-10-19
The b. & o. reorganization.

The problem with financiers now is the
reorganization and rehabilitation of the
Baltimore e. Ohio road and who will forrnu-
late the plan. The fight for control will
soon begin, and is already attracting the
attention of railway financiers and man.
ayers. The stake is a magnificent one, for,
while the b. & o. is greatly burdened with
debt and nonsupporting branches, Receiver
Murray and other expert railway managers
are of opinion that it will again take rank
as one Of the greatest railway properties in
the country. Receiver Murray played a
strong card by not ignoring Baltimore as an
important point on the system, where
former homogeneous had made a mistake
The United States Investor, in commenting
on the reasons for the bankruptcy of this
valuable property, says: '"The people of
Baltimore attribute the downfall of Balti-
more q Ohio to the Garrett and Mayer man.
agement. When Mr.. Spencer retired from
the presidency some fourteen years ago the
floating debt had been we'll cleared up by
the syndicate loan of $10OO0,OOO, and he had
prtcked the profit and loss bubble of S48 :
Ooo,uU0, proudly referred to by Robert Gar
rett as surplus. Most of it consisted of
the securities of acquired lines or advances
on these roads, on which there was very lit
tie hope of realizing anything. 1t well rep
resented the folly of extensions, but Presi-
dent Mayer did not take this lesson per-
SOnaIly. He simply continued to perpetuate
the Garrett regime by acquiring roads right
and left which only proved burden to the
company, and rendered it necessary to turn
out more securities in order to keep the
company afioat. In fact, it appears that
most of the floating debt was incurred un-
der the Mayer management. A further mis-
take which contributed to the downfall of
Baltimore & Ohio was the resumption OF
dividends soon after the commencement of
the Mayer, regime Not satisfied with pay
ing cash dividend in November, 1891 a
stock dividend of 20 per cent. was paid TO
represent money said to have been put into
the road. There was also an issue of new
stock for improvements, and since then
bonds have been turned out in great abund-
ance and car trust obligations have been
saddled on to the property. 1t was the
tie instead of encouraging industries along
the line of the Baltimore & Ohio to fight
everybody and everything, even Western
Union, Adams Express, Pennsylvania, New
York Central, and 1t was the extension of
the road from Baltimore to Philadelphia,
right into the enemy's country, that still
further crippled the road.
Automatic COupIers and Air Brakes.
1t is evident that the railroads will not,
by Jan. /, 1898, have carried out the require
ments of what is known as the federal
coupler and air-brake law. The fact that
such roads as the New York Central, which
owns 3S,S97 cars. has yet no automatic coup
lers on it's cars and has yet to equip 55 per
cent. of its cars with air brakes, is evidence
to that effect The Erie has 403SS cars, and
yet has "A per cent. to equip with automatic
couplers, and 80 per cent. with air brakes
The Chesapeake & Ohio owns 1922 cars So
per cent. of which are yet to be equipped
with automatic couplers and 43 per cent.
with air brakes. The Baltimore & Ohio owns
SO, 23l cars, 50 per cent. of which are yet to
be equipped with automatic couplers and 50
per cent. with air brakes. The Pennsylvania
lines west of Pittsburg own 64275 cars So
per cent. of which have yet to be equipped
with automatic couplers and As per cent
with air brakes. The Pennsylvania lines west
OF F1ttsburg own 81, 543 cars, and have yet
TO equip G. per cent with automatic coup
lerS and 80 per cent, with air brakes The
Chicago q Northwestern owns 35,017 cars,
and has yet to equip 81 per cent. with auto
matte couplers and 60 per cent with air
brakes, and the exhibit of other Northwest
ern lines is but a little more favorable. Com
ing nearer home, the Cincinnati Hamilton
q Dayton owns 1910 cars. % per cent of
which are yet to be equipped with auto
matte couplers and per cent. with air
brakes: the Monon owns 520S cars 80 per
couplers and 81 per cent. with air brakes:
the Wabash owns Il. $50 cars 40 per cent are
yet to be equipped with automatic couplers
and Is per cent. with air brakes. A singular
feature of the exhibit is that the poorer
roads have done more TO carry out the spirit
of the law than have a number of the divi-
dend payers.