Evening star. [volume] (Washington, D.C.) 1854-1972, 1901-02-07
GOSSIP FROM GOTHAM
Recent Railroad Combinations Subject
Of Much Discussion.
QUESTION as TO IT'S WISDOM
Russell Sage Makes Some Peril
nent Observations Regarding 1t.
TRAGIC INCIDENT RECALLED
Special Core spendenee of The Evening Star.


The passing of the control of the Southern
| Pacific Railroad Company into the hands of
| a group of financiers believed to be in
| charge of the interests of the Union Pacific
| is fruitful subject for discussion. 1t takes
| a big financial transaction to set New York
city people to talking. But there Is no
doubt that this bilion-dolar deal, probably
| the greatest that the world has ever seen,
| has amazed even the financiers of Wall
street. Some of the students of statistics
| eI en- figure that fully billion and a half
| is involved in the transaction, directly or
Indirectly And as one Wall street man has
I phrased it, billion of dollars is "a heap of
| money"
Opinions seem to differ to whether the
| movement is wise one or not Russell
Ssge, a man accustomed to large financial
| transactions, views with alarm the com
| munity of interest proposition as applied to
the railroad situation. He taxes tne view
! that the passing of the control of the rail-
reads into the hands Of one man or one set
! of men will not meet with approval in the
granger states, and that hostile Legislation
may be expected in case this policy Oh mar
monization is carried to an extreme. mas
much as Sage Is quoted as being worth
hundred million dollars himself, conserva-
| tive financierS here in the east do not hesl-
tate to listen to what he has to say upon
! topics of this character. On the other
| hand, the consensus of opinion of the best
lawyers, the best business men and the
best railroad men here in the metropolis is
| to the effect that no law can be framed
and enforced which will prevent individuals
from obtaining control of different railroad
| lines and holding this stock in the names of
individuals. Some of these men even go so
| far as to say that the effect of anti-railroad
| legislation in the western states and the
creation of the interstate commerce COM
| mission with a view to check pooling and
hi t,ot tnv,C hntH1 hn i'll
road systems of the country has had the
effect of doing precisely the opposite of
what was intended when these anti-railroad
statutes were passed.
Russell Sage's Remarkable Statement.
Russell Sage is quoted, among other
things, as saying that one set of men prac-
| tically control at the present time all Of
the opportunities Of transportation and
interstate commerce. Henry Clews Is 'au-
thority for the statement that Sage recently
| told him that If John D. Rockefeller came
| to him and told him that he wanted the
Sage interests in the Western Union Tele-
graph Company for 80 cents on the dollar,
despite the fact that this stock. as divi-
dend payer has for years lowered around
par, that the Sage interests would be turned
over to the Standard Oil people for 90 cents
on the dollar. The excuse that Sage gives
for this extraordinary statement is that
John D. Rockefeller has only to announce
| that he intended to parallel the Western
Union lines all over the country and the
bottom would drop out of Western Union.
From this Henry CleWs concludes that for
the first time in the history of Wall street
the business of the street is being run on
basis strictly scientific. The interests in
control of the market today, he argues, can
put up stock or put them down as suits
their purposes.
Henry Clews is authority for another in
teresting statement. 1t is that the deal
which has Just reached a completion
q nf "a Sn11th harm Do
cific interests by the Union Pacific inter-
ests is one that Commodore Vanderbilt
himself dreamed about way back in the
Sixties After he had picked up a half
dozen valueless railroad properties and
| united them under the management of the
New York Central and Hudson River Com
| pany he caught glimpses and CLEANS Of
great transcontinenta al system under single
management. Mr.. Clews says that he died
a disappointed man, because he was una
BILE to carry his plans into effect. 1t has
| a third Of a century of time, aided perhaps
by the hostile legislation directed against
rates to bring about this result.
Tragic Incident Recalled.
The statement Of the great Wall street
broker, Henry Clews, is of interest in this
connection at this time when 1t is remem-
bered that the head of the Vanderbilt fam
lily, who succeeded the commodore died
from attack Of apoplexy during quar-
rel with Robert Garrett who was at the
head of the then great and powerful Baltf-
| more and Ohio railroad system. 1t has
generally been understood that the subject
unuer discussion at the time was the ques-
| ton of the control of the Baltimore and
Ohio 1t has always been said in this con-
nection that the death Of Robert Garrett
some time afterward put an end to another
great transcontinenta railroad scheme.
| Garrett had acquired control of the aten
| Island Rapid Transit system, once essen
oil UoD
| said that 1t was his intention to build I'D on
! the island, which is now the borough of
| Richmond Of Greater New York, a Balti-
| more and Ohio terminal city. with great
docks and shipyards, much as c. p. Hun
| tington built up the southern town of New
port News.
The change Of control by the Southern
| Pacific by the way, has raised an interest
| future of Newport News AS is well known
| this project was like the apple of the eye'
| of the great Southern Pacific railroad mag
| nate 1t seemed to be his intention to
eventually make Newport News sort of
| eastern terminal Of the Southern Pacific
road. For this reason he acquired thou
| sands of acres of farm land thereabouts,
| taking title to the property through land
| and Improvement company. Great docks
and shipyards were built and greater docks
| and shipyards were planned. On the very
| day that the change of control Of the
| Southern Pacific was announced and the
! Huntington interests passed out Of South
| ern Pacific, probably never to return, it was
| currently reported on Wall street that the
| Huntington interests at Newport News had
| been sold. The theory which seemed a
| logical inference and natural sequence
| OF the sale of the Southern Pacific was that
| tine Huntingtons, having disposed Of their
| railroad interests. did not care about run
| ming the shipyards in the future This does
not mean that the town of Newport
| News will of necessity be materially
affected by the change, since millions of
money have been poured out like water on
that southern city, and the investments
| which have been highly productive for sew
eral years past will naturally take care of
themselves. 1t argues IN the minds of the
4 New York financiers merely that the new
| interests which have obtained control of
| these great Pacific roads do not care to
| make Newport News a base of supplies
and that New York city. Baltimore and
| Boston will secure the Hons share of trade
| which would ultimately have gone farther
south II c. p. Huntington had not died.
IThree Groups of Harmonious Interests
| 1t appears. according to an authority on
these matters, that there are now only three
groups of interests working together and
for harmony OF interests which may be-