The age-herald., 1900-12-28
SHARP CRITICISM.
Interstate Commerce Commission and
 the Southern Railway.

the Southern Railway.
 From the Financial Chronicle, New York l City December l. 1900.
 | In a decision rendered this week the In- | terstate Commerce Commission has thrown | on all disguise and has revealed the anmus | which is controlling its course and action | The framers of the Interstate law intended | that the Commission should act in an im- | partial manner, deciding cases before 1t 1 strictly In accordance with their merits
 The Board has from the first acted as If 1t were the champion of the shippers, and as | If It's chief function consisted in harrassing l and embarrassing the railroads and ruling | against them when occasion offered But | while the Commission could not conceal the bias it felt its utterances at least have hitherto been couched in judicial and un- objectionable language thus preserving a semblance of impartiality. This week. how ever, 1t has finally thrown precaution to the winds. The Southern Railway Company had asked for rehearing in a case involv- ing relative rates to Lynchburg, Danville, etc, which had been decided against it in
 the spring. In it's petition the company
 claimed that to obey the decision of the Commission would involve a loss to it of S43SOOO per annum, and that as no dividend
 had been paid. on the connpany's common
 stock of $120 000,000 during 1899 to insist
 upon cutting off that amount of revenue
 per year would be tantamount to depriv-
 ing the owners of the stock of their prop
 erty without due process of law. The Com
 mission makes an attempt to dispute the
 figures of loss given and then goes on to
 say that the stock was issued as part of
 reorganization scheme under which the
 company came into existence, that it does
 not appear that anything was ever paid
 upon such stock, and finally (apparently
 to clinch weak argumenD that 1t does
 not rest in the whim of Reorganization
 Committee in Wall Street to impose tax
 upon the whole Southern country"
 The allusion here to the "whim of a
 reorganization committee in Wall street
 is not only irrelevant and in exceedingly
 bad taste, vlolatig every rule of official
 propriety, butt in the inference which it
 seeks to convey is a gross misrepresenta-
 tion of the facts of the case. There was
 no occasion for lugging in the reorganiza- tion committee at all, and we can conceive of no reason for so doing, except a desire on the part of some of the members to
 pose before the country as foes of the rail-
 road and financial interests The reorgan-
 ization committee was not on trial and
 the commission deemed the capitalization
 Of the Southern Railway excessive and
 wanted to maintain its position with refer ence to the rate question, a decorous state
 ment to that effect would have answered
 every purpose and have shown that the board still had some regard for its official position. Instead, the commission seeks to cast aspersions upon 8 body of men who | in recognizing the old Richmond & West
 Point Terminal Company and It's constitu- ent properties rendered as important a public service as was ever rendered under similar circumstances by a like body any where In the country. As a matter of fact the reorganization committee, instead of being pilloried, should be held up to public approval and praise. They accomplished a task which seemed well-nigh hopeless-a task which several previous committees formed for the same purpose had been ob- iged to abandon because of its onerous character.
 The imputation that this committed which carried to success an undertaking which everyone else had abandoned, sought by the reorganization to impose a tax upon the whole Southern country" is absolutely without any foundation in truth, and has nothing whatever to sustain 1t. When these people took hold the prop critics constituting the present Southern Railway system were a physical as we'll as financial wreck The service was bad and the costly way in which it was rem dered forbade the possibility of cheapening the charge to the public. The reorgani- zation provided the means for rehabiitat- ing the system and poured millions upon
 millions into 1t for its improvement and development Now at last the territory served by the lines has a railroad service worthy of the name. So far from having imposed tax upon any portion of the Southern country, we venture the asser- ton that the 6Outn toQay, as a result or these efforts and expenditures, is being served better and cheaper that at any pre- vious period in its history.
 The statement that there is no evidence that anything was ever paid on the com mon stock of the Southern Railway is of the same baseless character The stock referred to was issued In exchange for he stock of the old companies. Everybody in
 the financial and railroad world knows
 that the terms were not liberal Indeed, the reorganization was a peculiarly dras- tic one. Leaving out of account what may have been originally paid on the old shares, the reorganization managers levied heavy assessment on these old stoes5, and also on some classes of bonds, and the se- ments in order to get any representation in the reorganZed company.
 The Richmond Terminal shareholders had
 to pay BIO per share, and the East Tenn
 essee common stockholders had to pay S20 per share, and besides had their holdings
 reduced 40 per cent. So hard were these terms considered that many of the securi- ty owners sacrificed their holdings rather than accept them, and the reorganization syndicate had to step into the gap. If the Intersta te> Commerce Commission does not know all this it is inexcusably ignorant
 on most important subject, coming direct
 ly within its province. And what bene-
 fits have the security-holders who came in
 under the reorganization scheme received
 thus far? They have had no dividends upon
 their holdings of common stock and today
 six and half years after the reorganiza-
 tion, they find thes shares quoted in the
 market at the munificent figure of IT. When
 therefore, the managers of the company
 sought to protect these shareholders
 against the action of the Interstate Com
 merce Commission in threatening a large