The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1906-08-22
MIR. RIPLEY's SECOND LETTER.


The second epistIe of President
Ripley. of the Santa Fe. 10 the people
of Kansas is even better than the first
which he wrote Mr.. Ripley discusses
the questions at issue In a frank, open
manner that can not fail to command
attention.
And there is much good argument
in what Mr.. Ripley says=from the
standpoint of the present railway
stakeholder. If the farmer gets richer
by reason of his land advancing in
value because of good crops and bet
ter advantages in his neighborhood.
should not the railway owner also be
allowed to grow richer by reason Of
an advance in the value of his rail-
way stock owing to better conditions
along his railroad2
But here is another question: If a
Santa Fe stakeholder made a bad in
vestment a few years ago by buying a
lot of water which he supposed to be
good Santa Fe stock, ought the pub
lie to be held up now in order to make
his investment good?
This proposition goes back to the
question of watering stock. Why
should not stock-watering and infla-
ton of values be kept out of the rail-
road business, and out of all corpora
tons in fact, the same as out of the
banking business. When a bank is
started with 500. 600 capital the pub
lie knows that somebody has put up
a hundred thousand dollars of good
money to back 1t. When railroad
is built with s25,0o0000 capital. the
r.,tffo 7oaevst 1rro1x- r-I,a4bar tho cox
600 600 capital represents anything
but some nicely engraved paper. Quite
likely it represents five million dollars
of actual wealth while the other twen-
ty million is water However, If the
venture is a good one, in a few years
the railroad is paying dividends on
the entire % millions, and the stock
is worth par or better. Why2 Be
cause the people are paying high
enough freight and passenger rates to
enable the railroad to pay dividends
on that 20 millions Of watered stock.
This paper is not prepared to take
the position that a railroad company
is not entitled to an advance in the
value of it's stock. It is the railroads
that develop new regions in these
days. If a railroad company builds
into a new territory. advertises it, and
works hard in developing it and in
creating traffic. the men who risk
their money in the enterprise are en-
titled to a handsome profit II the en-
terprise is a success. At present this
profit is secured by apitalization
and then pushing the stock up to par.
but this system has been so abused
that 1t should be abolished.
Mr. Ripley makes some sensible OBJ
servations on the railroad in politics
He argues that the Santa .Fe. as the
largest taxpayer in Kansas, Is inter
ested in good government. That
argument has weight. But 1t is also
true that the Santa Fe. as a big tax
payer. is further interested in having
laws favorable to it, although they
may. be unfavorable to some one else.
Other big taxpayers are constituted
the same way, so the Santa Fe is no
exception.
AS long as the railroads and big
use no undue or corrupt
in politics there will be no
hand in politics by the people as
W
by public officials and
by legislatures as any other class of
taxpayers no more. Their rep
resentatves have the same right to
present their arguments to legislative
committees as anyone else, and as
long as they do it openly and fairly,
this paper will file no objection. It is
when they resort to undue pressure
and influences that the people rebel.
A good Illustration of the right way
for railroads to deal in politics is the
action Mr.. Ripley is now taking-to
appeal directly to the sense of fair
play and justice in the people as a
whole. By so doing Mr.. Ripley is ac-
comprising far more for his cause
in the long run than any of his agents
could do by attempting to corrupt
voters and legislators.
e-.s.zss.as2
THE PRIMARY QUESTION.