Los Angeles herald., 1906-08-30

d. II. Hartman, the central figure In
the Wall street sensation caused by the
declaration of dividends by directors
of the Union and Southern Pacific
roads at the end OF last week. is a
man Of many surprises. Almost every
act Of his that has attracted more than
passing attention since he appeared on
the scene as a great railroad magnate,
has been attended with complete and
intense surprise.
Indeed, Mr.. Harrlmans activities as
a railroad magnate transforming vast
systems from a condition Of bankruptcy
to affluence are themselves perhaps the
greatest surprise of all. 1t was not
until 1900 that Hartman cut any figure
In the railroad world
The most important railroad position
that he had occupied up to that time
was that of vice president of the IL
linois Central road. This post he held
for time prior to the annual meeting
Of 1889, when he retired to devote him
self to the banking and brokerage busl-
ness, which previously had occupied his
attention. He incidentally took UP the
handling of railroad securities, with
which he had been intimately familiar
from the very beginning of his active
business career.
1t was really in 1900, however, that
the magnate's commanding force OF
character revealed itself. And from
that time until now he has held a posi-
tion which for prominence, importance
and influence has been second to few
in the railroad and financial worlds. 1t
was in 1900 that Mr.. Hartman man
aged for syndicated interests that had
purchased the Union Pacific, as 1t
emerged from the hands of receivers,
the purchase of the Southern Pacific on
terms that not only afforded the Union
Pacific its direct outlet to the Pacific
coast and the gulf, but gave the rail-
road control of g Morgan line of
steamships, running between New York
and New Orleans.
If 1t was a surprise that Hartman
should be called to such a position;
what he has accomplished since has
been still greater and more remark
able surprise. In these six years the
physical condition of the whole of what
is known as the Hartman syStem-in
Guiding the Union, Southern and Cen
trail Pacifics, the Oregon Short Line
and the Oregon Railroad and Naviga-
tion ompanies-practically has been
reconstructed and from "a streak of
rust" has been transformed into a
standard railroad, brought up to the
highest condition of physical perfec-
tion and made capable of being ope-
rated after the latest and most ap-
proved methods of the day. The great
Salt lake in Utah has been bridged
and other physical obstacles have been
overcome, the surmounting of which
up to the time that Mr.. Hartman took
hold Of them had been considered i'm
possible. Much of the expense of max
ing these physical improvements has
been met out of the earnings of what
before had been bankrupt properties
incapable of paying fixed charges. They
have now been made to earn, in addi-
tion to the amounts appropriated for
these improvements, immense divi-
dends for their stockholders.
One year after his purchase of the
Southern Pacific Mr.. Hartman gave
the railroad and financial worlds a sur
prise great enough to throw them into
a state of convulsion and for a short
time threatened almost universal col
lapse. In 1901 James J. Hill purchased
the Burlington road for the Northern
Paci1c. Mr.. Hartman thought that
purchase threatened Union Pacific in
terests and demanded that he be al
lowed to have a finger in the pie. He
was brusquely refused. Before Mr.. Hill
or his associate, ]. Pierpont Morgan,
knew what was happening Mr.. Harri-
man was in the market purchasing con-
troll OF the Northern Pacific, with the
result that on May o, 1901, the price Of
the stock of that road scared to $1,000 a
share. Two days later Mr.. Hartman
announced that he owned a majority
of Northern Pacific stock. Out of
total of $155, 100000 he held shares of the
par value of $7SO0O,OOO. A comparison
of notes, however, showed that of his
holdings $41, 100000 was preferred stock,
which under the plan Of reorganization
could be retired at any time. Mr.. Hill
and Mr.. Morgan had $42, 900, 900 of. the
common stock, and this was a majority
of the promise, as manifested in the
of the Northern Securities
company as a holding concern for the
securities of the Ncrthern Pacific, Great
Northern and Burlington systems.
The securities company subsequently