Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1902-01-25
Explained by J. J. Hill Before
Interstate Commission.
Tells of the Northern Pacific Deal and
Purchase Of the Burlington.
New Burlington Co. Has Friends Enough to
Take All the Stock.

! ern Railway. testified for 81 hours be-
I fore the interstate commerce commits
sion here, today. In answer to ques-
/ tions bearing upon the effect of the
community of interests plan on rates
/ he declared that competition does not
lower rates, but on the contrary, adj
vances them. He said that in the
Northwest, where the Northern Pacific
and the Great Northern have been at
peace for 20 years, where one road has
/ agreed with the other, on rates and
maintained the agreements, rates were
lower than in any other part of the
country.
! In regard to the purchase OF the Bur-
l:ngton by the Northern Pacific and
Great Northern. Mr.. Hill declared that
the purchase was matter of necessity
anG was not due to a movement in
| line with the trust idea"
There are some old men-some very
old men-interested in the management
of the Great Northern" said he. 1.-TWO
of them are over 80 and several over 20
years. They wanted to form a close
corporation into which they could con-
fide their interests with the assurance
that the road would be managed along
the lines which have made it a success.
1t was to have taken over one third of
the stock of the road. The plan seemed
4 good one, and then it was proposed
to let all the stockholders in-not alone
tie few owners of the -third-but
all of them. The plan met with APP
prevail and then it broadened into the
! idea of taking in the Northern Pacific
toll 1t, 1,oI
mony for 20 years, and the change in
the holder of the securities would make
no difference. 1t can make no differ
enoe and will make no difference"
Mr. Hill declared that his time be-
! lcnged to the commission and that he
desired in every way to aid them to
the extent of his ability. Chairman
Knapp said thereupon that Mr. Hill
would be called to the stand again, to-
morrow.
Darius Miller, first vice president and
tariff manager Of the Chicago, Bur-
| lington & Quincy and former traffic
manager of the Great Northern, was
! the first witness. In answer to ques-
tions by Mr.. Day, attorney for the
commission, Mr.. Miller stated that the
Burlington was absolutely Independent
in it's operation in the making of rates.
Have you received instructions from
either Mr.. Hill or Mr.. Hartman in re-
gard to making rates?" Mr.. Day asked.
Il have received none" the witness
answered.
Commissioner Prouty asked the wit
ness to what extent the Northern Pa
cifiC and Great Northern were COM
petitors and Mr.. Miller put the COM
netitive traffic at about 25 per cent He
declared that the Burlington was not
a competitor of the Great Northern
and the Northern Pacific. He said the
two Northern roads had made FREQUENT
agreements to maintain rates but said
he knew of no penalty ever having been
imposed for violation of agreements.
| J. c. Stubs, traffic manager of the
Southern Pacific and the Union Pacific
followed Mr.. Miller. Mr.. Stubs
stated that f. H. Hartman was
chairman of the board of directors of
both roads but that he was appealed
to only in extraordinary cases. Mr..
Stubs said no such case had arisen
since his appointment and that had
proceeded under his general instruc-
tons from Mr.. Hartman. He de-
clared that the Southern Pacifics, and
Atchison, Topeka &, Santa Fe were
competitors.
| rs there no agreement between you
and the Atchison as to a division of
the oil and sugar traffic." asked Mr..
Day.
| None whatever" replied the wit
ness. There is division of the orange
traffic. but this is due to the fact that
about so per cent. of the crop is tribu-
tary to each line
The witness averred that the Union
Pacific and the Southern Pacific were
competitors. although he admitted that
he believed the Union Pacific controlled
the Southern Pacific. He declared that
this control could have no effect on
rates, owing to the existence of COM
petition.
]. J. Hill took the stand at o'clock
Much time was consumed with routine
examinations to show his official re-
lations with the Great Northern
Northern Pacific and Burlington COM
Ipanies.
Mr.. Hill said that the Northern Sc
curities Co. owned no stock in the
Chicago Burlington and Quincy Rail-
way Co. (the new company, but
owned about half of the stock of the
Chicago Burlington and Quincy Rail-
road Co. (the old corporation).
He explained that the new company
was really a union of the three lines
(which formed the old company. and
operated the latter by virtue Of q
lease. The half of the stock of the ole
company which was not owned by tn,
Northern Securities Co, the witnes!
said. was owned by the Northern Pa
cific Co. In the new company. thu
Great Northern and Northern Pacifi
were the chief stockholders, havin,
issued joint bond to cover the pur
: chase price with the Chicago. Burling
r ton and Quincy Railroad Co. Thes
two companies. as stockholders. cleo
the directors of the Burlington.
r There were approximately 1900
E stockholders in the old Burlington,
|, said Mr.. Hill. 1T was impossible t
: buy the stock, amounting to abou
h s1OO.000.O00. in the open market an
i another plan was adopted, resulting i
the sale Of the property like a piece Q