davidaulloa/AmericanStories huggingface dataset:
The farmer and mechanic. [volume] (Raleigh, N.C.) 18??-19??, 1907-08-27
FIGURES SHOWING HOW COUNTLESS
MILLIONS HA VE BEEN MADE BY A
SCRATCH OF A PEN.---WiH Payne in Every
bOdyS.

with many vicissitudes, until 1884.
when the Pennsylvania broke away.
The price of coal fell, and Reading.
with its load of debt representing un-
developed coal lands, went into the
hands of receivers
When an individual woes into bank
ruptcy the water is squeezed out of
him. When railroad goes into bank
ruptcy not only is the water not
squeezed out, but more is put in. The
Every important railroad reorgani-
zation involves an infection OF CAPT
tai.
Reading was reorganized and set
going again. A. A. Mcleod came into
control, and promptly took up the
plan to monopoIize hard coal Some
brilliant fnanciering followed. I'm
fortunately the courts upset some of
the Mcleod leases The whole struc-
ture fell The fall touched off the
panic of 1898
once more Reading went into the
hands OF receivers and was reorgan-
lied. Of course, none of the water
was let out. On the contrary, more
was put i'll. This time the capitaliza-
ton was lifted above $500, 900, or
about S316,000 per mile of road.
This reorganization, however.
brought in the powerful friendship OF
Mr.. Morgan. Thanks largely to him.
a spirit Of amity began to pervade the
hard coal roads: but this better under
standing among tht carriers did not
increase the happiness of the ''inde-
Pendentf operators who depended
upon thlIn for transportation. Ger
tain Of these operators projected as
independent railroad to tidewater But
the project failed
Still the independents were dissatis-
fed with freight rates. Presently,
led by the Pennsylvania Coal Com
pany they projected another road to
he built along the cid Delaware and
Hudson canal. The Pennsylvania
Coal Company was a comparatively
small concern. It's output amounted
to only five per cent of the total It
had $1,000, 900 capital stock-a good
deal of it scattered in rather small
holdings Morgan & Co quietly
gathered IN the majority of the stock
Now just what Morgan & Co. paid
for that s5,00Q,000 Of Pennsylvania
Coal company stock has never been
disclosed, but the house turned the
stock over to the Erie railroad. which
issued therefore s32 900. 900 of four
per cent bonds and $4,000 600 of four
per cent preferred stock. It was sup
posed that this s5,000,000 of preferred
stock represented the bankers COM
The farmer and mechanic. [volume] (Raleigh, N.C.) 18??-19??, 1907-08-27

walking together in the direction OF
Fayetteville street There was an
mob was rapidly pressing on in the
direction of Mr.. Turner so as to cut
him Off. Turner saw the game and
leaving the sidewalk entered the
street and facing them said. as he
drew his two pistols: You fellows
are too much for me. and If you ad-
vance / shall fire" The mob needed.
1t was the deadest halt possible IN
answer to a threat of impending
danger Merrill stood close at hand
armed only with his big monkey
wrench" Turner gave in the next is
sue of the Daily Sentinel an exact &C
count Of this, and what followed.
which | will not give, although per-
fectly familiar with the whole dis
graceful, outrageous proceedings, in
cluding the very bad treatment of Mr..
Turner by the Mavor. Bill Harrison,
brother-in-law OF Bill Holden. the
Governor. Mr.. Turner always referred
to his friend Merrill as the man with
the monkey wrench" Turner was
prosecuted and outraged that day in
the Mayors farcial court A full ac-
count, and most accurate, appeared in
the Sentinel. | reioiced to meet aNer
now eighty-three years of age and in
good health. and we had long talk
over old days and events.
NV second visitor recently was my
old friend Of long ago, Colon1i Robert
Bingham, the famous teacher. at the
mead still of the great Bingham School
, near ASheville. | had. not met him
! in quite thirty-two years, and it was
| a great pleasure to me when he SO
, honored me as to cali at my home.
When he was a little boy | went to
! school with him at his fathers very
renowned school in Orange county,
| twelve miles from the University of
North Carolina. His very gifted broth
| er, William, a Gentleman and scholar
of admirable character and engaging
| qualities / knew well. He had rare
gifts as a writer. and '-is school gram
imars-Latin and Greek-deserve to
live, and are still used in
some leading schools l was older
| than he was by some years, but [ was
| in his class. The Bingham School is
| indeed an institution of learing'' in the
best sense in this goodly Southland we
| all love. Colonel Robert Bingham is
| the fourth Principal of the school of
| more than an hundred years that has
| done such truly great work for the
| people of this part of mans blessed
heritage. 1t has turned out scholars
would Just like to know if anv school
in any State now sends forth any
better equipped students than this
school under my old master, William
j. bingham. gave to the State and
the South. Who today equals at fif-
teen or nineteen James Johnston Pet
tigrew, the Admirable Critchton of our
| own land? Many others could be
named that would take first seats in
eny class in any school in all America.
Lord Byron wrote in his marvellous
The farmer and mechanic. [volume] (Raleigh, N.C.) 18??-19??, 1907-08-27

common sold at $164 a share. The
Baltimore & Ohio and the Lake Shore
roads have jointly bought over 500
100000 of Reading stock out of
total of s140, 000,0O0-thereby pass
ing it on toward a firm cap talzat ~
with fixed charges. The New York,
New Haven & Hartford has bought
5000 600. or one-half, of the COM
mon stock Of the New York, On ario
& Western, thereby putting II also in
the way of becoming a form of CAPT
talization bearing fixed charges-for
these purchases by one road of the
stock of another are generally financed
in the end by an issue of bonds.
The Loot in Union Pacific.
How could all this watered stock
be SO handsomely supported and be-
come so agreeably valuable unless the
railroads were charging the public
for coal and for transportation much
more than enough to yield reason
able return upon the actual invest
ment?
After the Credit Mobilier scandal
congress inves igated the Union Pa
cifc and found that it had cost the
contractors a little under s51 900. 900
to build the road.
For this there was issued:
Government subsidy bonds $4,000 900
First mortgage bonds 49,. $1,000, 900
Land grant and income
bonds " $4,000 900
Common stock ....... $4,000, 900
Total sos. 000. 900
The Northern Pacific Jared even
better in this regard. The govern
ment gave il 10000 900 acres Of pub
lie lands-a piece of generosity which
in no wise restrained the stock water
ing proclivities of the builders and re-
organizers.
The road has been reorganized three
times and is now capitalized at more
than s65.0o0 a mile. excluding the
bonds tnat il issued Jointly with the
Great Northern to pay for Chicago.
Burlington and Quincy stock Cana
dian Pacific is capitalized at only s29-
900 mile. Northern Pacific's funded
debt per mile. excluding the Burling-
ton bonds, is greater than the entire
Capitalization per mile of the Cana
dian road. To understand how North
ern Pacifc's capitalization has been
boosted to this figure we need only
glance at the last reorganization
There were s42.00O.000 OF first mort
gage bonds outstanding. In the re-
organization:
Each $1,000 bond received $3.50 in
The farmer and mechanic. [volume] (Raleigh, N.C.) 18??-19??, 1907-08-27
JOHN DALZELL, REPUBLICAN,
LEADER


This mar has exerset a powerful
political influence in this country the
past fifteen years. The Dingiey tariff.
I'm It's most important schedule. IS
John Daizeil's han6iwork Under its
operation the American people are
taxed hundreds OF millions OF dollars
annually on iron and steel. and manu-
factures thereof or which bat So
7s4,O43 found the way 10 the United
States Treasury in the fiscal year
1906. All the rest was pure graft
and went 10 swell the profits OF The
steel trust and kindred concerns and
pay dividends on their watered stocks
This country is the biggest producer
OF iron and steel in the world and
makes the cheapest iron and steel IN
the world. Given a monopoly of the
domestic market. our ironmasters
send abroad immense cargoes Of iron
and steel and manufactures thereof
and sell to foreigners such wares in
competition with all the world. and
much cheaper than the same goods
are sold at home and herein the
blessed tariff is a benefaction 10 the
foreigners and hardship TO the
American consumer.
The Constitution OF the United
States confers on Congress the power
more than 80 per cent OF the duties
'laid'in the iron and steel schedule
of the Dingley law are collected by
the manufacturers OF iron and steel.
They are paid by the people all right.
but the money never reaches the
Treasury. One great ironmaster is
reputed to have an income Of 81 500
900 a month-thiS is taxes laid" in
the Dingley law, not for the public
treasury, but for the private Golfers Of
Andrew Carnegie. who is one of the
largest tax collectors in the world
and second only to the government
OF the United States in this hemis-
phere If his name were Bill Jones.
he would be just as rich with the
privileges he enjoys to tax some so
900, 900 Of his fellow-citizens for his
private gain.
John Dalzell is one of the very able
men in Congress. He Is a lawyer OF
first-rate capacity, a student with vast
acquired knowledge, a debater strong
In addition he Is an honest man and
sincere in the practice of his devil
ment. Hailing from Pittsburg-that is
a product of tariff privilege-he has
persuaded himself that the chief mis-
sion Of the tariff is to protect and
, its incidental office to raise revenue
| Hence he favors prohibitary duties on
| whatever Pittsburg can turn ont. For
| example the duty on wire rope and
wire stand is 1922 per cent, and prac-
| tically prohibitory. on cutlery the duty
| is 63.70 per cent. on fies and rasps.
| 1859 per cent: on chains, 1895 per
| cent; on tin plates 52.97 per cent.
| These are sample graft. Mr.. Dalzell
The farmer and mechanic. [volume] (Raleigh, N.C.) 18??-19??, 1907-08-27
STOCKS
OF AMERICAN RAILWA US

Mr. A B. Stickney. president of the
Chicago Great Western, recently dis
cussed railway rates before the Trans
portation club of St. Paul. Taking the
complete statistics for 1905, he found
that the average rate of interest paid
on all the railroad bonds in the United
States was 3.65 per cent. and the av-
erage rate of dividends paid on all
the railroad stock was 3.02 per cent.
Here" said Mr. Stickney, lis the
average margin Of profit of all the
railways in the United States.
There is no other business in the coun-
try which is done on so small mar
gin of profits as 3.02 per cent. dl-
vidend. No other invested capital gets
such small returns as the capital
invested in railroads"
If anybody ASK; how much of the
stock upon which the average divi-
dends of 3.02 per cent, are paid is
water. and therefore, entitled to no
dividend whatever. they reply that
there can't be any water because the
capitalization per mile of American
railroads is much less than that OF
like arguing that Florida is an ideal
summer resort because it is mush less
disagreeable than Panama.
But one fact is rather significant.
That is there are not many spots in
the vast mass of capitalization where
{ y
ing water.
Take for instance, that conspicuous
group of railroads known as the hard
| coalers."
The anthracite industry naturally
invited monopOlistic ambition. The
supply is confined to a region in
PENNSYLVANIA all of which could be put
in an area twenty-five miles square
This region roughly speaking. is only
100 miles from Philadelphia and $50
miles from New Ya~'- Transportation
of course, is the key.
Eight railroads tap the territory
namely, the Reading, Erie, Pennsyl-
vania. Lehigh Valley, Delaware &
Hudson, Lackawanna & Western,
New York, Ontario & Western, and
the Central of New Jersey There
were early. various fragile pools and
gentlemen's agreements; but the first
really important stop toward monopoly
was made in 1871 by T. b. Gowen,
then president of the Reading He
began buying all the independent coal
lands he could get hold of.
He seems to have had the right
idea-namely, that it doesn't make any
particular difference what price You
pay for property provided 1t enables
you to get a monopoly of a staple
comm odIty. Having a monopoly. yol
can easily make consumers pay dlvi-
dends on the purchase price. He
bought about hundred thousand
acres of undeveIoped coal lands,
therefore, or a third Of the amount
in sight In so doing he loaded up
Reading with an increased debt to the
amount of $50,000,000. Hereafter
there existed 5O.000.000 additional
motives for monopolizing hard coal
The result was pool in 1878,
among the hard coalers, limiting out
put and fixing prices. This continued,
The farmer and mechanic. [volume] (Raleigh, N.C.) 18??-19??, 1907-08-27
Ey SAVOY AID.

yrgt in The tariff 10 incrrA~e ths f'stts-
buFg tribe - faililoaAlg~s Govern fga vssta
arc bad of wor rs-c IN exact .ropaw<4esa 81
the degro* r privilege u s+leas favor
ed clas-ca FrtNEIc8gS tn govern
sncDts - the Antithras % equality
IATt1 duNoe laid to pvatrs,t
tho steel trust arc q grsyal~asu
that concern enjoys ard thar
must De p4ld by the ordinary cltl-
zen for the babe unborn and tho dead
being arc eTc-ted 81 the price -
iron and steel II the taF7T dtd not cn-
hance the price - irou and steel and
all the manufactures thereof every
ironmastoi would turn frce trader The
oaly meaning - the wori protec-
ton as II relates - the tArir is
the privilege 10 fuonopoItna the market
and charge exorbitant prices
Since the southern question made
way for the issues growing out ~
politics OF political economy we have
had Ave great national tarin battles
in this countrY-l6S7 1855 1855
1890. ard 1922 In each and ala Of
them the tariff was paramount Three
cf them-lss2. 1890. and iSs2-re-
suited in signal Democratic victories.
One. 1856. was substantial pemo-
cratic victory One. 1855 was a Re
publican victory by the slendercst OF
margins The tarifT WAS more or ics,
considered In 1875 ana 1885. Demo
cratic years. IL was in 1850 when
Garfield. a tariff reformer by the way
headed the Republican ticket aud was
elected. Here is the one prosperous
issue for the Dem ocratic partv--hon-
est and constitutional taxes. but tho
party has master. and though that
master has run away from the issue
he rendered. he is certain To head
the Democratic ticket. and the coUtro-
versy Will be over government owner
ship and operation OF railroads. what
ever the platform may say. or unray.
or not say-that Is. II Mr. Bryan Is ia 6
candidate My humble advice TO the
Democratic party is to fix for 1919
The Republicans cannot even revise
the tariff. much less reform It. 50
the issue Of real tarln reform VIII ae
as Irresistible in 1872 as IL was n
1882 or 1890 or 1892
Mr.. Dalzell was born in New York
City In 1S45. When a child ne was
taken To Ptttsburg by his parents. and
has resided there ever since He was
given an excellent and n classical edu-
cation. His is a legai mind. and he
naturally chose the law for a profes-
sion. He had not long to. wait for
clients, and while yet n young man he
go: to be one or the general counsel
| ~ the Pennsylvania Railroad. At the
| bar he was noted for the readiness
with WI ch he grappled with matters
| sudd emily and Unexpectedly sprung by
| his adversaries He seemed aIways
| prepared and aoneared to know tho
other sides case as well as his own
| And thus Dalzell was a leading ard
! successful lawyer in 1856. when he
/ as returned to the Fiftieth Congress
The farmer and mechanic. [volume] (Raleigh, N.C.) 18??-19??, 1907-08-27

missions, or bonus, but that IS neither
here ncr there. The Pennsylvania
Coal Company was the key to the
monopoly of hard coal. The monop-
oily has been in perfect working order
ever since. Interest and dividends on
the securities issued by the Erie road
in payment for Pennsylvania Coal
Company stock amount to sixty cents
on each ton of that companys output.
But what of that? They might as
we'll have amounted to $3.50 Con-
sumers of mOnopOliZed hard coal
would have had to pay it.
The Water-Logged Erie.
Erie's previous experiences in the
stock-watering line had been extensive
and picturesque. From 1868 to 1872,
in the able hands of Daniel Drew, Jay
Gould and James Fisk, its share of
capital as increased from SIT, 900, 600
to 7S,00e, 900. Nearly all Of this in
crease was mere fiat, put out for
speculative purpose and with scarcely
a pretense that any actual value lay
behind the issue. Reams of stock
were printed and put out by night for
the purpose of breaking Commodore
Vanderbilt's corner in the shares
In 1895 the road. being bankrupt
underwent a typical reorganization,
conducted by Mr. Morgan There
were outstanding. for example. S33.
$4,000 second mortgage bonds. In
ceived seventy-five per cent of their
face value in new four per cent bonds,
and fifty-fve per cent in new four per
cent preferred stock, or 130 per cent
in all. The old s77,837,000 bogus
common stock was converted into a
like amount of new common stock.
There was issued s63, 100000 of first
and second preferred stock, large
part of which was distributed. as
sweeteners and bonuses to reconcile
the old security holders.
In defending the capitalization OF
the hard coal roads in 1901, Mr. Nc
Leod pointed out that four of them
namely, Reading, Erie, New York,
Ontario & Western, and Lehigh Val
ley-had outstanding s3S2,5 554 600 of
stock upon which no dividend had
ever been paid and which had a
merely nominal value in the market.
So. If this was water, who was hurt
by it-no dividends being paid and
the stuff being of little value? Why
bother about the old rogs heap? But
today dividends are paid upon all of
this stock with the exception of Erie
common. Last year common seemed
so bright that the stock sold at above
$50 a share, while Readings watered
The farmer and mechanic. [volume] (Raleigh, N.C.) 18??-19??, 1907-08-27

new prior lien bonds.
All second and third mortgage bonds
received 11S IL per cent OF face value
in new prior lien bonds and fifty per
cent value in preferred stock
Each $1,000 bond received 1855 in
new securities.
The old stock. practically all water
was exchanged for new stock Of the
same amount.
The Atchison, Topeka and Santa
Fe has been recognized twice. In the
last reorganization the old general
mortgage four per cent bonds receiv-
ed seVenty-fiVe per cent in new gen
eral mortgage fours and forty per
cent in new adjustment fours Thus
s129.320.770 was converted into s14s-
1888 in new fours old second
mortgage "a bonds received 1f3 per
cent. in new preferred stock Second
mortgage "B" bonds received lis
per cent. in new preferred stock
OF the "A" and "B" bonds there
were $S7,937.500 outstanding. and
they drew four per cent year inter-
est The holders paid in cash assess
ment Of four per cent. and received
S99. .s69,375 of new preferred stock
which draws five per cent. a year In
dividends. The old common stock.
about all water and Of very little val
Ue, AT the tlIne OF the Te0EaulZatlDIls
was exchanged for the same amount
s102. 900, ,000-of new common stock.
This new common stock now draws
five per cent year in dividends. and
until the recent deplorable slump IN
stocks 1T sold above par.
They will tell you that Il would not
be fair to squeeze out the water in a
reorganization. For example. a great
many small investors had bought Tn
"A
ison stock during boom times Times
turned bad The roads could no long
er carry the oyercap apltaliZation and the
proitless branch lines with which
financial geuiuses had loaded them
Bankruptcy followed but the small
innocent investors must not be frozen
out They must be permitted to ex-
change their old stock for new. and So
given a chance 10 recoEp when good
times come again. Such Is the argl-
ment
AS matter Or fact II doesn't work
that way The ordinary innocent In
vestor gets frightened when hc sees
the road approaching insolvency. and
dumps hL- stock on d falling mark =
for what little IL viii fetch. or he ls
pinched in his own small business and
has TO sell: or he can't paw the assess-
ment. II any event, he throws over
the stock The ooulent "reorgan "a
ton syndicate" or individual Huarciera
scoop II in.
In 1902 the Messrs. Moore and their
friends bought up s70.000.000. in
round numbers Of the stock ~ the
Chicago, Rock Island and Pacific
which had paid from tySo 70 three and
z half per cent a year IN dividends
through the hard times. By the sim
pie devices Of lease and q holding
Continued on Page Two)
The farmer and mechanic. [volume] (Raleigh, N.C.) 18??-19??, 1907-08-27

Ralph Waldo Emerson, among the
best of New England mer OF genius, in
one Of his thoughtful. impressive ea-
says has this, and il is worth remeIn-
boring friend may well be reck-
oned the masterpiece of Nature" I
had one such among my early school
mates-the late Henry A Taylor, OF
Granville county, the son OF a highly
esteemed Episcopal minister, Rev.
Lewis Taylor. They belonged to one of
the old. staunch, prominent families
of that really great old county. Henry
and | were of undying friendship. He
was, until his death, when some sew
enty-three years old, friend indeed,
one of those of whom the greatest of
the worlds geniuses, Shakespeare,
writes in Hamlet
These friends thou hast, and their
adoption tried.
Grapple them to thy soul with
hoops of STEEL
Some authorities give it "hooks of
steel" but Richard Grant White, a
truly excellent editor of the works of
the master, gives it hoops" My
friend Henry would believe no evil of
me, and defamation made no impress
sion whatever upon his confidence, ad-
miratiOn and love for me. What a
dear, tried, faithful friend he was,
L nave DeeH TeIIll1lucu bI lIllS Dy re-
cent visits of three dear friends, all
advanced in years, but remakbly we'll
preserved. The first visit was by my
dear old friend, Samuel Merrill, Of
Raleigh, whom 1 have known we'll
since early in the year 1869. He is
not a native born citizen Of the Unit
ed States. but is one of the truest and
most faithful. He is every inch a
man He it was who stood SO bravely
by 10 Turner the day 10. Holden went
down to the railroad depot 70 attack
him as he got out of the train from
Goldsboro. Holden hed five white
men and one negro With him as his
body guard. Turner was apprised of
the attack before he left the car,
which was the one next to the bag
gage car. He had purchased some
fishing poles for his boys at Hillsboro.
and had to take them in the common
car, and this caused him not to be in
the rear car, where the Holden mob
expected to assault him. Mr.. Merrill
was at work near the railroad Che is
an honored and noble mechanicl and
had learned of the coming of the Hol-
den gang He went to the train, met
his friend Turner as he came out. and
told him of the game proposed
and said to him l will go with you.
He escorted Turner for over a square
when the mob had discovered them
The farmer and mechanic. [volume] (Raleigh, N.C.) 18??-19??, 1907-08-27

Friend after friend departs;
Who hath not lost a friend?
There is no union mere of hearts
That finds not here an end
The farmer and mechanic. [volume] (Raleigh, N.C.) 18??-19??, 1907-08-27
BY DR.. T. b. KINGSBURY.

Friends" has this stanza, tender and !
simple:
The farmer and mechanic. [volume] (Raleigh, N.C.) 18??-19??, 1907-08-27

These friends thou hast and their
adoption tried.
Grapple them to thy soul with
hoops of steel
The Daily Ardmoreite. [volume] (Ardmore, Okla.) 1893-current, 1907-05-02
Beware Of ointments for Cstarrh
That Contain Mercury.

as mercury will surely destroy the
sense of smell and completely de-
range the whole system when enter.
ing 1t through the mucous surfaces.
Such articles should never be used
except on prescriptions from reput-
able physicians. as the damage they
will do 20 the god you can possibly
derive from them. Halls Catarrh
Cure. manufactured by +. J. Cheney
a Co, Toledo. o, contains no mer-
curry. and Is taken internally. acting
directly upon the blood and mucous
surfaces OF the system. In buying
Halls Cartarrh Cure be sure you get
the genuine. It Is taken internally
and made in Toledo, Ohio. by +. j.
Cheney & Co Testimonials free.
Sold by Druggists Price, 75c per
bottle.
Take Halls Family Pills for constl.
patton