The Washington herald., 1907-02-27
MAGNATE FLAYS FISH.


other roads He said, in giving these
views, that he would like 70 get the Atch-
ison, the Northern Pacific. ana the Great
Northern and run them himself If the
commission would only keep its hands off.
Hartman also, in the course OF the
day, explained the "sale" Of 100000 South
ern Pacific shares to William Rockefeller
at the time that Keene sued, alleging that
this was in order to put the ownership Of
these shares with somebody who would
act against the attempt Of what he called
a speculative pool to control the profits.
The reports the company produced
showed that in June. 1903. when these
shares had passed to Rockefeller. the
company was credited with stin owning
them. Harrimans explanation for this
seemingly false entry was that the re-
port had not been made up until Novem-
Der, when Rockefeller sold back his
shares, and that the comptroller had been
directed TO make the entry as Of June 80,
the date Of the report
VIII Not Tell About santa Fe.
Another question Hartman absolutely
refused To answer to-day was whether he
was the owner OF all or a part of the S1o.-
100000 Santa Fe stock purchased by the
Union Pacific since it's last report, it pre-
viously having been shown in President
Ripley's testimony that Hartman, Frick,
and Rogers had secured over $50 100000 Of
the Santa Fe stock, when Hartman de-
manded Of Ripley representation on the
Atchison board. Harriman's explanation
Of why he and his friends got into Atchi-
son was that they wanted to have frank
relations between that company and the
Union Pacific The Atchison is the most
direct competitor Of the Hartman sys-
TEN.
In view Of the many important ques-
tions Hartman refused 20 answer to-day
covering his OWN stock deals. it is almost
certain that the attorneys for the govern
ment viii ask the United States courts to
compel him TO answer. On questions put
to him by the commissioners themselves.
they showed plainly that they thought no
matter what legal right Hartman might
claim in the matter, there was every
moral reason why he should answer them.
CriticiseS Northern Pacific.
At the beginning Of the afternoon ses-
sion Hartman was asked 10 explain his
remark made in the morning, that If he
had got control Of the Northern Pacific
Z y
where it Is to-day.
4 did not mean 10 open up that vista,
said Hartman, but as long as you have
done It, perhaps / had better explain. I
believe that the territory tributary 20
the other railroads would have been open
ed 10 the territory served by the Northern
Pacific. / believe that the improvements
on the Northern Pacific would have been
more drastic, that their motor power
would have been increased more rapidly.
and believe more inteIligently."
Hartman said that he understood that
much Of the motive power of the North
ern Pacific was in very bad condition
When Kellogg asked why IL was that the
Northern Pacific had reduced its rates
whereas there seemed 10 have been an in
/ crease in the rates Of the Union Pacific
Hartman wanted TO know If Kellogg
was defending the Northern Pacific.
kellogg was once AN attorney for some
Of the Northwestern roads Kellogg paid
no attention 20 this question.
Hartman said that the Union Pacific
has developed its lines much more quickly
than the Northern road had been de-
yeloped, and that the Increase in rates
was because the Union Pacific and South
ern Pacific were carrying commodities Of a
higher class. Kellogg got him 10 admit
that while there had been no reduction
Z in rate. the net earnings Of the Union
Pacific had been more than doubled since
/ he took charge Of IL.
Union Pacific Dividends.
we have been trying 10 force the
Great Northern to give US consideration.
believe now we have come to some I'M
Il.
Mr. Hartman. Mr.. Hartman made a
! long speech then about the Union Pa
cifc. declaring that he had spent over
/ $50. o05, 900 on IL, partly from the sale Of
new securities and partly out of the
earnings Of the road. He said no other
road had made any such expenditure.
Mr.. Kellogg asked him II lot of other
roads hadn't, citing for instance, the
Pennsylvania.
well" said Mr. Hartman, If the
Pennsylvania had started long ago the
Improvements it is now making. it would
not have suffered as much as il has in
the last four or FIVE years.
That brought the inquiry down 20 the
point Of the Union Pacific dividend. Mr.
Hartman said IL had been paid partly
out of the traffic earnings and partly out
Of investment earnings.
From 1893 20 1885 said Hartman.
| 30 per cent Of the capital invested in
railroads was paying no dividends, and IL
would be quite consistent that a 10 per
cent dividend TO distribute over an aver
age OF twenty years, from a railroad that
had not received anything for ten years,
and perhaps for five or six or eight years,
received a fair compensation
Abiding TO the fact that there was
surplus of $25,000,000 after the dividends
had been paid last summer Hartman
said that this was necessary, and that
the old method of distributing all of the
/ earnings in dividends was what had led
to the bankruptcy Of many OF the lines.
Would Hurt other Roads,
The contention Of the government at
! torney seemed to be that Union Pacific
might have put its profits into the re-
duction Of rates. but Hartman said that
he thought that the stockholders We're
entitled to have received Il per cent
dividend. IT said he, they can do
it legitimately and properly and give
| proper service to the territory reached by
the roads or adjacent to it, or do it at
no greater charge than that 20 similar
territory in any other part Of the coun-
try II we did increase our rate on Union
Pacific, it would create such a scamper all
over this country that you would not
/ hear the end of IT, Just as long as you
can keep some of those hines solvent the
Union Pacific will continue to earn all
the money it is earning now. II you are
going to throw some of them into bank
ruptcy and create chaos, you may reduce
our earnings"
Hartman said that the dividend was
made up of per cent out of the earning
of per cent of the stock This did
not appear in the resolution of the di-
| rectOTs, or Harriman's statement to the