The daily morning journal and courier. [volume] (New Haven, Conn.) 1894-1907, 1899-04-27
JOHN W. ALLING'S ARGUMENT
CONTINUED from Ninth Page)


CONTINUED from Ninth Page)
@. "They buy the bonds from yor
and they take the whole establishment
off your hands after you have started
the work?" A. mo, sir; they put VI
the money and hold the bonds until the
work is constructed, they put the mon
ey in for construction of work; they
give me money for the bonds during
the construction Of the work, and hold
them until the work is completed"
O. "You take STOCK AND BONDS
from the companies with whom you
are dealing?" A. Yes, sir"
Q. "At a bargain?" A. mo, sir;
according to the contract price
Mr.. Rutherford, as the constructor
and builder of a plant, is SO familiar
with this scheme of financing" by
which the contractor takes the bonds
and the stocks of the company with
which he Is contracting, in formal pay
ment of his contract, that when l sug-
sested to him that he so took such
stocks, his answer is the familiar hail
fellow" expression, FRIGHT YOU
ARE"
Colonel Rutherford shows his idea of
the value Of the stock taken by the con-
tractor in such transactions.
@. "You said, in putting the Allan
ia company in, We put it in q" A.
II am member of the Atlanta COM
y pany.'
Q. us that the company where you
made estimates and did the engineering
and constructions" A. Yes, SIR
q. "An6 tnoly ctr in, raUoi'
mo, sir; not single dollar in Stock
O. 1T would have paid for your SER
vices?" A. 81 DO NOT WANT PA
PER; want money!
".
Ii this committee, representing the
state of Connecticut, will look at the
facts as they are, it will find that no
value can be attached to the fierce COM
petition In the western states between
the Independent telephone companies
and the Bell companies. AS admitted
\ BY Mr.. Holbrook testified to by Mr.
Hyler. the management of the local
Bell companies in the west neglected to
do Justly by the people, and when the
* Bell patents expired, a conflict at once
4 began IN those western states We are
not troubled with the merits or dement's
of that conflict 1t is inevitable that
the conflicting, competing systems will
come together sooner or later, and in
evitable that the public will pay divi-
dends and interest on the combined
capital of both systems, sooner or later.
In that fierce competition the question
of cost of service goes to the winds
In this state, where the Southern New
I1rr 1ov, al L.
ed the people of the state fairly and
Justly, this committee will see to it that
the question between it and its would
be competitor is fairly decided. 1t does
no good for the woud-be competitor to
offer lower rates, if they are below the
cost of production That is a mark of
folly. 1T does no good to argue that be-
cause, inspired by such folly, they
actually 60 ahead and make such rates,
and the Southern New England Tele-
phone company is obliged to meet such
rates and furnish telephone service be-
low the cost of production, that thereby
"a public good has been attained.
"
" Now comes the testimony of Mr.. Ty-
Ter. For the weight to be given to this
Testimony, l quote from Governor Wal
Ter:
Now, as I said to Mr.. Alling, + do
not know of any man In this room
although have great confidence in my
witnesses, as lawyers usually have-I
know OF no man in the room so compe-
tent to give genral information to this
committee about the telephone business
In the state and country as my friend
Mr.. Tyler, and especially as to the tel
ephone business in this state; quicker
than you can get 1t from record or from
papers of from testimony"
3 Nobody can doubt the competency Of
Mr.. Tyler to speak on the points which
control this hearing. Nor is there any
doubt about his honesty or his capacity
to express his ideas, and our PROPOSE
tions are based substantially upon his
testimony.
The question before this committee is,
necessarily, what will best promote the
permanent welfare of the people of
this state in the matter of telephone
service. This general question divides
itself into several subordinate questions.
Our propositions are these:
l. The permanent public welfare of |
LHS people OIL I0lS state can never be |
subserved by unreasonable legislative |
authority, to be conferred upon sundry |
persons to engage in a business. which |
another corporation has received legis- |
lative authority to transact while such |
other corporation is discharging its full !
duty to the public. Such action would |
be breach Of public good faith, and no |
calamity can be greater than for the !
state to set an example Of bad faith.
2. The Southern New England Tele-
phone company is organized upon a
cash basis; its stock to-day represents
dollar for dollar in cash; it has earned
and Is earning no unreasonable profits
to the stockholders; its stockholders
are for the most part Connecticut peo-
pie, who have been led, upon the faith
Of legislative authority, to put their
savings into it's shares a very great
majority in number Of these holdings
consist of stockholders with small
amounts of stock.
In the business sense of the term the
sntfre capital stock of the Southern
New England Telephone company was
always paid for in cash or its euuiva-
emit The price of using the Bell Tele-
phone patents when this company was
,rganized was $535, 900 in stock. 1t does
no good to say that this bargain was