Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1901-10-05
SHAN Talks TAXATION
Governor in His Boone Speech
Goes Alter Stocks and Bond
Plan.
Makes a Vigorous Argument
Against Pet Theory Of the
Independents.
Defends Executive Councils Rail-
way Assessments and Ex-
plains Some Things.
Special to Times-Republican.

Special to Times Republican.
Boone, Oct. 5.-Governor Shaw ad-
dressed a large audience here last night.
The governor devoted most of the
I evening to national issues, but entered
4 into the question of taxation In Iowa at
more length, he said, than he intended
to give 1t In his other utterances during
the campaign.
II do not know that railroads and ex-
press companies and telegraph and tele-
I phone companies. all Of which are as
sessed by the executive council. pay
their full share of taxes, but 1 believe
they do. II did notI would have urged
an Increase. But I do know, however,
| that these corporations never before
! raid ne large proportion of state taxes
under assessments made as during the
last three years. 1t never was necessary
Ito prove the assertion that the people
| are paying taxes that corporations
ought to pay. Let the declaration be
made and most persons will admit 1t.
This makes it easy for even a lazy man
to make stirring speech, or write a
catchy paragraph.
There are some people who at least
assume to think the Northwestern, and
perhaps some other roads, should be as
sessed on the basis of the quoted value
OF their stocks and bond. but no one Will
insfss that the Union Pacific should be
SO assessed. The three and q fraction
miles Of the Union Pacific road is now
valued at more than ten times what the
bond and stock standard would give.
Permit me to give few Illustrations
| OF the manifest injustice Of this basis,
| andsof the ease with which it could be
manipulated in the interest of all the
ilessg Important lines of road, yes of all
roads "A majority of the stock Of sew
!! eral railrads is held by certain trunk
| lines. These trunk lines eject the ofti-
cers and dictate the policies OF the dag
onal roads. They make contracts with
| the very officers they elect for the trans
lfcr of their freight and passenger traf-
| fic at their several functions. do not
| ay tllas ouch things are done. but It Is
evident t6Es the trunk lines holding this
\ oofses4 could iiaa'sc 4 h.e dtas.pna isssoads 8
feeders IL they 50 desired. Fhe majority
/ of stock, which carries with 1t the con-
J troll of the road, is never on the market,
and the quotations of stock relate only
| to that portion which has no voice In
Its management. In most instances
1 such stock Is not even listed on the
| stock exchange.
Permit an illustration OF the same
lprinciple as applied to banks. I know
| Of bank doing a fairly good business.
Rival interests sought to control. They
went out on the sly and commenced
buying up the stock. When each had
secured perhaps 40 per cent they each
discovered the efforts of the other and
the remainder went "outsof sight" No
one would have given the same price
for all the stock as was willingly PAID
for the fraction that carried with 1t the
salary Of president and cashier. and
an assistant cashier, and the entire
management OF the institution. The
same thing was witnessed within year
lin certain Pacific railroad. No one
would have given $1,000 per share for
all, but more than that was paid for
| fraction of the stock which was sup
posed to carry with it the control OF
what is now known as the Hill and
Morgan system, more than 10000 miles.
and connecting four of the great lakes
with both oceans. "A few hundred dol
liars per share counts as dust on the
balance when such interests are at
stake. Would any one assess those w.
600 miles on such basis?
There are no market quotations on
the stock Of more than half the rail-
roads doing bushes in Iowa. But there
might be quotations on all these roads
lif their assessment was controlled
thereby. Some stockholder could In
struct a broker to sell a thousand shares
whenever conditions were favorable,
and another stockholder would instruct
| his broker to buy. Thus record would
be made. Other dealers on change
would know little about the road and
care less. I insist that the stock OF
more than half the roads of Iowa can
be sold at a nominal figure any montn
of the calendar year.
"Conditions have been stable during
the last two years, and yet certain IS
sues of stock of the Chicago Great
Western railway fuctuated 100 per cent
in 1899 and SO per cent in 1900. Certain
tissues of the Wabash fiuctuated "a pei
cent in 1899 and 100 per cent In lsoV. me
common stock of the Keokuk " Des
Moines, under a forty-five year lease te
the Rock Island, sold for 3is cents IN
January, 1900 and at cents in Decem-
Der Of the same year. The value of the
road did not increase in that proportion,
but a plethora of money, coupled with
an increased business possibility that
the rent might more tnan pay interest
on the bonds, resulted in the advance
of the stock. From per cent bonds of
the Chicago. Milwaukee q st. Paul
huctuated to per cent in 1900. Equal
ly noticeable fluctuations have occurred
in the stocks and securities OF nearly
all railroads Registered coupon bonds
OF the Northwestern. bearing per
cent interest, deprecated from 112s in
May, 1900, to 1867 in December of the
same year, While the general issue Of 311ss
per cent bonds of the same company
advanced from 1854 70 1875, then back
to 1O7s and again to 10, all in 1900. 1 do
not believe these or. similar fluctuations
in the market quotations of its stocks,
either affect the true value of the
Northwestern system or indicate that
the actual value of the road itself had
been other than stable.
I think people generally lose sight OF
the fact that the assessed value OF real