Evening star. [volume] (Washington, D.C.) 1854-1972, 1899-01-07
new FREIGHT POLICY
Baltimore and Ohio Company Declares
Its Purpose.
issue MADE ON DEMORALlZED RATES
Estimated Condition of the Com
pany Under Reorganization.
PROPOSED CONSOLIDATION

Monday last marked the Inauguration of
the new freight policy of the Baltimore and
Ohio railroad. What its effect will be on
other roads remains yet to be seen. Ihe
schedule of charges included in the pub
lished list, which has been filed with the in
terstate commerce commission. became the
tariff rates which We're imposed on all
shipments made that day, and will continue
to be the rates until definite action follows
on the part of other systems.
The declared purpose of the Baltimore
and Ohio in pursuing this course is TO force
the question of demoraiized freight rates
to a crisis, so that existing laws will be
satisfactorily amended, or else result in a
general appeal to the interstate commerce
commission to act as ballast to the pres
ent unsteady conditions.
The level of rates as published by other
roads is about the same between the same
points al is the ones listed by the Baltimore
and Ohio. However, high officials on all
the systems admit that lower rates are and
have been allowed, despite the inhibitory
provisions set forth in the law. If, there
fore, other systems follow the example of
the Baltimore and Ohio, ii will result in d
general lifting of rates, because the pub
lished list in nearly every instance is higher
than the charges which are now generally
imposed, and to adhere to those lists means
this lifting process.
Future Action.
The future action of the Baltimore and
Ohio, 1t is said will depend upon how con-
sistently other systems shall comply with
the law. While that road will assist the
interstate commerce commission far as
possible in the effort to enforce the national
statutes relative to rates, it will refuse to
engage in the work of espionage, even
upon its strongest competitor. While ready
to assist, the managers say it will refuse to
play the part of the detective or prosecutor
AS a consequence the prospective outcome
of the new move is watched with the keen
est interest. If the Baltimore and Ohio's
effort fails and the existing practice is per-
sisted in, and if, a sequel to the failure
no satisfactory pooling bill is secured from
Congress, then the outlook in railroad af-
fairs. it is predicted, will assume all the
aspects of chaos and confusion. The roads
will then be left nothing to follow but the
cut-throat and discriminating policy.
Company ReOrganized.
The following is the estimate of the re-
organization managers of the position of
the Baltimore and Ohio Railroad Company
(as reorganiZed) upon the consummation
of their plans:
Upon the completion of the reorganiZa-
ton of the Baltimore and Ohio Railroad
Company and of the reorganization or con-
solidation of the Central Ohio Railroad
Company's system and the Pittsburg juno
ton Railroad Company taS reorganized) the
condition, it is estimated, will be as follows:
The net earnings from operations together
with earnings from miscellaneous sources,
for the year ending June 30. 1885 including
net earnings from Central Ohio system and
Pittsburg Junction Railroad Company.
were SS,541 ,i:S3. From this however will
have to be deducted the sum of SOL 900
representing the decrease in the amount of
miscellaneous income occasioned by the
sale of securities and the cancellation of
sinking fund investments under the reor-
ganization plan of the Baltimore and Ohio
Railroad Company, dated June -, 1S!)S
leaving 1926. 433. Add to this the net earn
ings of the Baltimore and Ohio Southwestern
system for the year ending June 80. 1SgS
including miscellaneous income 81 $3.50 TG1
total. $40. 2S6. 1874. Deduct fixed charges of
the Baltimore and Ohio. 81 300, 1872 leaves
surplus over fixed charges of about
s., 295 ,402.
Amounts Expended.
apart from the large amount provided
In the plan for reorganization of the Balti-
more and Ohio Railroad Company. dated
June %, 1898. to be expended on the prop
critics comprised therein, and for addition
al equipment. the plan for the reorganiza-
ton or consolidation of the Central Ohio
railroad system, dated September rs 1895
provided the further amount of So 900 OOO
to be expended on the properties comprised
therein and for additional equipment: and
this plan provides the further amount of
50 100000 to be expended in like manner
on the Baltimore and Ohio Southwestern
system. The above statement of earnings
does not allow for any increase in earn
ingS from these expenditures, which it is
confidently expected, should largely aug
ment the surplus over fixed charges
London Opinion.
In conversation with Star reporter. a
Baltimore banker said:
las large majority of the securities of
the Baltimore and Ohio Southwestern Rail-
way Company are held abroad, it is inter-
estiEg TO know what is thought of the plan
of readJustment and reorganization in Lon
con. The Statist on this subject. after re-
marking that ii can scarcely be expected
that Baltimore and Ohio Southwestern Sc
curity holders will be enamored with The
plan says: But while this fact 1.-THE reduc-
ton in the rate of INTEREST," NAV make hold
ers OF the Baltimore and Ohio Southwest
ern securities hesitate before accepting the
proposed reductions of interest. other con-
siderationS must be taken into account
The most important of these factors is that
competition in the states continues TO he
come more and more severe, and now that
both strong and weak lines alike are sup
pied with ample capital resources no com
parry can hope to survive which has not a
roadway in such condition that it can work
at a minimum of expense. Although for a
time the Baltimore and Ohio Southwestern
might continue to pay its way and to show
a moderate surplus as an Independent I'M
dertaklng with its present charges sooner
or later it would be forced into bankruptcy.
and it would probably have to be recon-
structed on much more onerous terms than
are now offered
The View IndOrsed.
This Is the disagreeable but solid truth.
The Baltimore and Ohio Southwestern. un-
der the management of President E. r.
Bacon, has been operated as advanta-
geously and successfully as existing condi-
tons would permit. When the consolida-
ton was effected between the old Baltimore
DIVIDED RI