Los Angeles herald., 1907-02-27

II the actual figures came up to the
promises.
The Southern Pacific meeting was
held In the morning and the Union
Pacific in the afternoon. The Southern
Pacific first declared n dividend OF 215
per cent, As per cent of which went to
the Union Pacific, the owner of that
much stock. Then the Union Pacific
dividend Of per cent, per cent traf-
fic earnings and per cent from in
vestment earnings, was declared, the
directors deciding to pass It to the ex-
ecutive committee for approval and
announcement, which was customary.
Hartman at Funeral
The meeting Of the executive COM
mittee was scheduled for 10 o'clock the
next morning, but Mr.. Hartman said
he could not be present on account of a
funeral. It was late when the execu-
tive committee got together. BY the
time the committee had passed on the
matter it was after O'Clock In the
afternoon and the question then arose
whether the announcement of the divi-
dend should be made public at once,
thus giving the London market the full
advantage of the situation or whether
1t should be deferred until the following
morning, and the New York market
given the advantage.
1t was decided to adopt the latter
course and the committee did not make
the announcement until the following
morning.
Mr.. Hartman proceeded in his narra-
tion without interruption until this
point. He spoke deliberately and with
out hesitation Mr. Kellogg questioned
him closely in an apparent effort to
elicit some admission of motive In the
delay in the announcement, but Mr..
Harriman's replies were direct. He
admitted that the delay in the an
nouncement was unusual but said that
the occasion was unusual.
Marked an Epoch
"It was staggering" said Mr.. Harri-
man. ut marked an epoch, but if
could have been present at the hour for
which the executive committee meeting
was scheduled the announcement of the
dividend would have been made in the
usual way the morning after the direc-
tors meeting"
Commissioner Lane asked Mr.. Harri-
man what he knew about the buying Of
Union Pacific and Southern Pacific
stock on the market between the time
the directors decided on the dividend
and the time 1t was announced.
Mr.. Hartman declared he did not
know of any unusual buying of Union
Pacific stock but when the question
was applied with direct reference to
himself, Mr.. Milburn, his counsel, OBJ
jected and Mr.. Hartman refused to
answer.
Did you or your associates buy any
stock then in anticipation of this divi-
dend ?" persisted Mr.. Kellogg.
IT have always bought Union Pacific
more or less" replied Mr.. Hartman.
Then suddenly he wheeled around and
said:
Bought Union Pacific
ct bought Union Pacific stock in 1898
for $25 a share in anticipation of that
dividend. l bought it at the time of the
panic when one of my associates de-
clared ] had more nerve than any
speculator he ever knew, deeming it
speculation. I bought 1t then in antici-
patton of that very dividend. l bought
1t on the decline all around after the
San Francisco fire, in anticipation of
that very dividend.
Commissioner Clement then asked
Mr.. Hartman why he objected to tell
ing Whether he had or had not bought
the stock.
"On a matter of principle, simply"
replied Mr.. Hartman.
"What Is the principle involved, the
reaSon?" Commissioner Clement perse-
vered.
Lawyer Milburn again put in his OBJ
lection and Mr.. Hartman remarked
aside:
"I haven't any reason. I am in the
hands of my counsel"
Attorney Kellogg devoted much time
during the day to an effort to establish
the propositions that rates on the Union
and the Southern Pacific had remained
fixed, if they had not increased, over
period Of several years, during which
time rates generally in the country had
been reduced: that competition had
been destroyed in the territory covered
by the Union Pacific system; that the
purchase of stock in the Santa Fe was
move toward the naturalization of COM
petition by that line, and that the vast
sums devoted to betterments and divi-
dends by the Union Pacific had been
taken from unfair rates. The witness
was not willing to make any concessions
or any material admissions to those
contentious, and most of the testimony
was discussed between lawyer and wit
ness as to the facts and conditions in
volved.
Says Rates Are Lower
Mr.. Hartman declared Union Pacific
rates had been reduced II per cent since
he became president, and fell back on
the assertion that the expenditures for
improvements had developed the coun-
try and placed the system in condition
to handle the great traffic that has
come in later years, and that he and his
stockholders were entitled to the bene-
fits their enterprise had won.
There was an interesting discussion
of the per ton mile computation of
rates. Mr.. Hartman said the calcula-
ton was faulty because from the stand
point of low rate it was adversely
affected by high-class freight. Mr.. Har-
riman at first had remarked that he
did not think it would necessarily be
wrong for road to earn Is per cent on
its capitalization.
Fixes the Limit
"Where would you fix the limit?"