Evening star. [volume] (Washington, D.C.) 1854-1972, 1907-03-15
$1,000, 100000 WATER
HOKE SMITH VALUES RAILROADS
AT ONLY $4,000, ooo. 600.

CINCINNATI. March 1.-THE danger in
management Of railroad prop
critics and the necessity for government
control to prevent discrimination in rates
were urged by Gov. Hoke Smith of Georgia
in an address on Transportation" before
the Cincinnati Receivers and Shippers As
ISOLATION last night. Between 800 and 400
business men Of Cincinnati and vicinity
heard the address, which was delivered at
the annual banquet of the organization. He
said there was no more important and diff
cult problem to be solved by the people Of
the United States than that Of Transporter
ton.
Left without restraint" he said, "the
railroad companies can fix the value Of
lands. They can determine the profits OF
merchants. They can control the business
of the manufacturer. They can make and
unmake towns and cities. The condition
Of dependence by the public upon them In
creases from day to day. A few years ago
the transportation companies were con-
trolled by many and varied interests. Now
they are largely consolidated, and several
interests control nearly three-fourths of
the entire railroad mileage Of the United
States
these interests may be designated as
syndicates under the names of Hartman.
Morgan and Hill, the Vanderbilts. the
Moores Gould the Pennsylvania and
Rockefeller. While they conflict at times,
their struggles are in the matter of acquir-
ing properties, not In the operation of prop
critics, and their conflicts result, not in bet
stocks and bonds. upon which tine pubic
must furnish money to pay dividends. 30
The control Of the RAILROADS Of the coun-
try has passed from trained railroad OPP
orators to bankers, who speculate In rail-
road stocks. A notable result OF this oon-
dition Is the withdrawal of authority from
the local management and local superfn-
tendence. the reduction of salaries to those
actually doing the work OF transportation
and the dwarfing of the power and capac-
ity of the men upon whose management the
public must Immediately depend. 10 this,
at least in part, is due the recent tendency
toward less efficient service.
Quoted at Twice Their Value.
1.-The railroad properties of the United
States are capitalized at over $13. 900, CO.,
GOO. Careful estimates Of their actual val
ues show them to be worth less than &c.
OOO,O0O,OOO. The public, therefore. are be-
ing called on to pay excessive rates for
transportation to make interests and divi-
dends on $7,OOO,OOO,OOO of watered stocks
and bonds. These bonds and stocks rest
like permanent mortgage on the indus
tries Of those engaged in the various voca-
tons of life. The transportation company
by the use of the states power Of eminent
domain. The public is entitled to voice
in the charges which are made by the
railroad company for carrying passengers
and freight These charges must be rea-
sonable and free from Determinations.
1.-The duties of railroad company are
dual: first, to the public; second, to its
stockholders. The public must look to the
states and to the nation to protect their
rights. When we realize that over half
the stocks and bonds issued by the railroad
companies Of the United States are specu-
latiOns and not based upon money actually
invested in the properties, we see how
recklessly the rights Of the public have
been diSregarded.
Money Not Used for Improvement
Instead Of exhausting the capacity OF
our transportation companies to pay divi-
dends on watered stocks and bonds, the
public was entitled to have all the money
realized from the sale Of stocks and bonds
invested in the properties. Thereby the ia
cilities Of the transportation companies
should have been improved. The public
was, furthermore, entitled to a reduction In
transportation charges as the volume OF
business increased and the cost of service
lessened. The remedy Immediately before
us must necessarily be to perfect the lega
authority in properly constituted agents tt
| regulate and control, and then to enforce
lACSc d6eiilS, Tic IlSulS VI lut
public.
THE ratemaking power has been give1
| to the national railroad commission. We
| should not be afraid to place upon thai
| commission men sufficient in number t.
| handle these questions. Their pay SHOULD
| be ample, and a seat upon the nationa
| railroad commission should be regarded a.
| one fully as exalted as a seat upon the
| Supreme Court bench of the United States
Additional powers should be given to tn.
commissioners. Bonds and stock issue,
| upon interstate railroads should be sub
| mitted for their approval, and none SHOULD
| be permitted unless the money derived from
| their sa lie is to be spent upon the properties
made liable for them. Transportation
| companies should not be permitted to LOAF
| down their properties with stocks ant
bonds for speculative purposes. The rail
! road commission should have the fulles
| power to compel proper facilities to be fur
| nished. Any effort by railroad companies
| to retaliate with reduction of service o.
| by cutting pay Of employees should be me
| by severe personal punishment to the guilt,
| officers. State commissions should be EN-
| powered with full authority in matters o
Interstate transportation. Public sentimen
| should sustain state and national commits
sions in the most vigorous enforcement O
| the duties confided to them.'