The Washington herald. [volume] (Washington, D.C.) 1906-1939, 1907-05-02
MELLEN FAVORS TEST
Willing TO Have Government
Value Roads.
CONFERs WITH THE PRESIDENT
Visits Interstate Commerce Commits
sion Also AID Discusses Valuation
of New York, New Haven and Hart
ford-Indicafes Corporations May
Not Resist Future Legislation.

The proposal that the railroads OF the
United States shall be valued with view
TO providing basis upon which the gov
eminent may make or correct rates, and
the charge advanced in certain quarters
that railroad property in this country Is
vastly overca pitalized. were topics dis
cUssed at a conference yesterday between
President Roosevelt and Charles S. Mel
len and T. E. Byrnes, president and vice
president, respectively, of the New York,
New Haven and Hartford Railroad Com
pany.
II can be stated upon authority that
Mr.. Mellen frankly told the President he
was favorable 10 the government under
taking a physical valuation OF railroads.
and he expressed the belief that the
valuation Of the New York New Haven
and Hartford. about to be made by John
!. Stevens, former engineer in charge OF
the canal work on the Isthums of Pana-
ma, would demonstrate that that system.
at least, was undercapitalzed instead OF
being overcap italized.
Yesterdays conference was described
as being in the full and free" class,
and at its conclusion Mr.. Melen pro-
ceeded 10 the offices OF the Interstate
Commerce Commission where he dis
cussed the subject at great length with
Commissioner Franklin K. Lane.
Browns Mission the Same.
Gay or so ago W. c. Brown. vice
president OF the New York Central
came 10 Washington and had a long
talk with the President He refused to
state the object of his visit to the White
House. II was learned yesterday that
Vice President Brown discussed with
President Roosevelt the valuation plan,
as well as the subject OF 0vercapitali-
zstion.
The statement may be made upon high
authority that President Roosevelt's mind
is not made up one way or the other as
10 the adyisabilty of the Federal gov
eminent embarking upon a project of
valulng railroad property in the United
States He has yet TO be convinced that
such a valuation would serve any useful
purpose and does not expect the valua-
ton idea % develop 10 the proportions
OF a national issue either this year or
next
The President is reported to have told
d recent caller that eventually the rail-
a plan OF valuation. His prediction has
been partially verified by the action of
the Northern Pacific at Chicago, some
weeks ago, in submitting a statement 10 the
Interstate Commerce Commission showing
the valuation of its property, and by the
New York New Haven and Hartford in
engaging Mr.. Stevens to estimate the
actual value of that great system
President Gathering Data.
For several weeks the President has
been quietly collecting Information on
the subject Of railroad valuation and
overcapitalization. He has talked the
matter over with many railroad men, his
most recent callers being President
Aleuen and Vice President Brown. Other
railroad authorities are expected here
soon on a like mission. The President
has also had frequent conferences in this
connection with members Of the Inter
state Commerce Commission, notably Mr.
Lane. The latter is well posted on all
the phases OF the transportation problem.
and. having had no Connections before
entering the Federal service. is expected
10 prove safe and sane adviser TO the
President in any move contemplated by
the latter iu the direction Of securing leg
islation, either as 10 railroad valuation
or railroad capitalization
The commissioners are evry much in
terested in the New Ravens undertaking.
as Il is expected 10 set an example TO
the other big railway systems They
are particularly gTauficd because they
regard such a step as indicating that the
railroads viii not resist legislation by
Congress as vigorously as heretofore.
The commissioners say the valuation now
being made by Mr.. Stevens 10 ascertain
What It would cost 10 reproduce the New
Haven system would not preclude another
valuation being taken IN case Congress
should enact general law.
Mr.. Stevens called at the commission
several days ago and talked with Prof.
Henry c. Adams the statistcian, and
others about methods Of doing the work.
Mr.. Melleu left in the evening for New
York, and mr.. Byrnes returned 10 Bos-
ton.
Cost Estimated at 100000.
The cost Of appraising the New Haven
system was not discussed by the rail-
road officials, but it is understood 10 be
at least 100000. The Importance Of it TO
AR. MeIlen is said 10 be largely in the
increased prestige it will give TO his
road and in the confidence it will assure
holders Of the company's securities
Public men in Washington believe that
the disclosures made in the case Of the
Alton. a Hartman line. has had more TO
do with the agitation for Federal super
vision over the issue of railroad securities
than anything that has happened in the
railroad world N twenty years Harri-
mans manipulation of Alton bonds and
Alton stock opened the eyes OF the gov
ernment and the people generally. and
Immediately resulted in q resumption of
the discussion that something should be
done by the government 10 see 20 it that
in the issuance of railroad securities they
should be injected with something of
tangible value, instead of water.
The Presidents attitude on the two
subjects under consideration may be
briefly summarized as follows He is
studying the valuation plan. getting both
sides Of the story from men in the rail
road world and out of it. He is also
gathering evidence on the subject of rail-
road capitalization. Before reaching anv
conclusions, he win confer freely and
fully With railroad men ana with his
official advisers.
"SiIent LiBs"-Next Sunday.
The Washington Herald viii begin,