The farmer and mechanic. [volume] (Raleigh, N.C.) 18??-19??, 1907-04-30

To the Editor. htrstat. IS taA +
Issue with no accurate s xenffefss4n n ae
my friend. Captain Ashe Duf I +
submit that ~ hvu he places 3Ar aNtv- Il
age cost ~ construction 81 Atuffae3s4 s
railroads st S6e eco pcr mile h~ pgte
his nEuves teu high. ana taa{ when hr +
adopts tAl- valuation he Is mereib "a 4
pressing opinion. just as ~as
expressing au opinion tfhru ! stated 4
in an articl" published 6m @unda3
News aud Observer that thc hoo5
holders naa built American r4tlttoaaa I
Ry way of explanation wHi at
that / dld not intend fa place thc ae-
fuHl cost ~ railway construction skt ]
exactly &@G.0oo ter w4lt The aver
age bonded tud~btrauvsH of American !
railroads al this tim" IS approx mat IS /
~ S26.0oo per mill. according 20 th~ /
United States statistical Abstract, aud /
IN the article published ! WAS meFslA |
intending 10 express the opinion thai |
the bonded indebtedness uf out rail- |
roads is So neaY ~ the actual c,.~f /
Of construction that. practically sHes X =
ing il might bc said that thr bond
holders built the railroads haze
heard The sam" opinion expressed
more than once Iy men Who have
made a life study uf the railroad
| question II iS said that the figure
published Ia the United States Statlsti-
| c4l Abstract Nerv furnished pN th'
railroads themselves Whether this
| Is true or not, IA can be said that
| whoever did furnish the figures ssetn-
| Cd TO studiously avoid giving statistics
| showing exactly What has been the
| cost - American railroads froba-
| bly, reliable statistics cannot b. ob-
| tanned without careful and expensive
| investigation ON paRr 'as. status
| tical Abstract Of 1905, the total cost
| or railway construction per mile u
| placed at $66.7S0. II WAS the ac-
| curacY OF these figures which ] qu"s-
| toned iii the article mentioned ThHf
| such estimate is too high can. | think.
| be demonstrated beyond question Let
| us see hON this result is reached II
| is obtained by adding together the
| following
capital stock ...,....$ G.f47,o41,314
| Funded debt ......... i.44o.H4o.2o3
| Floating debt ....... il2t6l3,o8
And dividing the sum
| total ......... $ 4 a95t5oS.l
by the number Of miles of railroad
built prior to the year 1905, tp-wit:
PILOTS. | do not think mat Captain
Ashe Viii insist that this is the proper
| way 10 ascertain the actual cost OF
| railway construction. Why Be-
cause these figures include all OF the
| water Of all our systems ~ railway
How much water do the figures repre-
| senting the capital stock include z
| Can any man tell
70 illustrate how excessive this ostI-
mate Of $66.7$0 per mile cost If con-
struction must be-. ! VIII sax that the
issue Of Your paper which contained
| CAPTAIN Ashes friendly criticism u i1"-
, , wise contained the daily quotations ~
, ! stocks on the New YORK Exchange.
| Taking the quotations Of the common
stock Of ten railway systems. ] found
| the average mark ct price Of those ten
: stocks To BE- - 1-S-that IS to Say
s2212 IL per share. Who can SAY
whether these ten stocks really rep
resent even S2212 IL per share used
in constructing these ten -airoade re-
spectivcly? Who can say how much
Of this common stock was bonus
handed around among promoters ana
reorganizers2 Yet. IL must not b.
forgotten that in arriving ~ the eeti-
| mate of $G6.1S0 per mile as cost 81
| railroad construction these very stocks
; | were supposed To be worth par ANA O.
; represent dollar for dollar If Wc al,
> To accept $6G.750 per mile as the trus
cost Of American railway construc.
! | tiOn.
, Again. taking the quotations OF ter
first preferred railroad stocks. LISTED
in the same paper. | found the aver
7 | age market price to BE- II i-5. 81
| S51.20 per share If $50. .7sO pee
mile is to be accepted actual cost
then in arriving At such result thes'
:. tsn pr"ferred stocks wer" likewis'
q | supposed 10 represent dollar for dol
: lar Now in the column headed
Capital stock" in the table. on pag'
: ga. Statistical Abstract of 1905 II tn,
S amount actually expended in railwa'
[ construction had been stated. IA
Q as experts were able 10 drtefmine
4 instead Of the amouut of capital stocl
issued, some OF which represents moth
ing. we might get some idea of tn
cost of railway construction
Again / submit that the cost d
railway construction ~ Europe can y,
~ . n as = E#tfga b..
cost OF railroads in this country II
1854 -. Kenncar Clark Q. T. of Lon
don. and \. NJ. Wellington. C.@E.. 4
New york City, both eminent men Fl
their profession, made a careful IN
yestigation or the cost Of railway con
struction in America They declare
that many American lines Of railw1
had been built prior 10 that time ~
$4,000 per mile. that much bette
lines were at that time being con
structed for SIS 900 per mile tina
some Of our very largest systems ha.
only cost $4,000 10 $4,000 per mile
| Conditions are 80 different in EuRiaui
| that the cost Of building railroads Il
| that country seems to be far in exces
Of what IL has been in this country
| The question is not what is the cost >
| railroad building III England
| but j. There capitalization here
Are rates and charges here base
: | upon actual cost Of construction an
| equipment. or upon fictitious yalua
tion2 If the law was correctly state
or Senator Foraker. then il become
necessary to ascertain what Inves-
| nTent American railroads actually rer
! resent. for If they are basing thei
rates upon fictitious valuations. thet
according to Senator Foraker, the
| are violating the Law.
Again. capt Ashe. using the Mort
Carolina Railroad "a an ILLUSTRATION
SAYS that originally il cost $25. .606 Pc
mile. but that the MONEY spent ]
| improvements will probably bring th
| cost of construction somewhere nea
to $4,000 per mile The man wh
built a house for rent fifty years ag
| at cost Of say, $3 600. and has kes
/ his house in good repair TO the pres
eni time. has proba bly, spent mo,
than another $4,000. making his hous