The Mena weekly star., 1907-10-17
THE PROGRESS OF "dREEN
 GOODS" FINANCE.


 public stands amazed at the spec tacle of the traction exposures now in process in New York. There is something in the stupendous loot itself, but it is even more amazing to realize that the laws and regula- tions of public corporations are such as to make these transactions possl- ble. The conclusion IS quickly reached in contemplation of the revelations of such enormous swin- dles that President Roosevelt is more than right when he says that there must be governmental authori- ty having immediate control of the capitalization and organlzation of great corporations.
 Think for moment what these traction swindles in New York mean. Nearly all the street car lines of Greater New York have been merged into one great corporation bearing the name of the lnterbor- ough- Metropolitan Company. The first part of this hyphenated title coveres the subway system, con structed by the city at enormous cost and leased to the Belmont inter- ests and released by those interests to the Elevated Company. The sec ond part of the name covers all the surface lines that Belmont did not own. In making the great corpora ton. various small lines. some of them bankrupt and losing thousands of dollars every year, were pur- chased at nominal prices and sold to the Metropolitan Company at ab- surdly high and grossly fraudulant prices.
 These purchases aggregated only $2, 235, 900. but the property they represented was turned over for Metropolitan stock with par value of 22 millions and market value of nearly 42 millions. In all, the men who manipulated these deals--the half dozen inside" high finance" men realized about 50 millions net profit out of their transactions, for they also made big gains in the sale of inflated stock. To cover their merger they watered stock lavishly, shares being pushed up to $250 and bonds$l20, and at these rates the securities" boosted by all the arts and resources of high finance. !" were unloaded on the public in- cluding the widows and orphans" behind whom MT. Rockefeller and his kind are wont to seek shelter.
 Even with the enormous earnings of these united properties it was found impossible to give good ser Vice and pay ordinary dividends be- cause of the colossal capitalization. It was the clamor tor better service and the response that the corpora ton could not afford to give it that brought New York's newly created Public Utilities Commission into the question and started the investi- gation now in progress.
 Thus all of Greater New York, even after having expended tens of millions on a subway system to re- lieve street car congestion. is still contending with poor service because the looters have made it temporarily impossible to improve that service.
 This is an extremely fragrant in- stance of high finance" of course, but 1t must be admitted that it's character is Conventional" The same thing has been done on even larger scales in railway manipula- tions and in the organization and capitalization of many other big corporations. The names connected with the traction scandals are repre- sentative names. They are found in the directory rosters of many rail way corporations, street railway companies of other cities and still other concerns of great scope and power, all serving the public in one capacity or another. The men who bear these names are no better noi wrose than very many others con. spicuously identified with the great business of this country. Yet these are the men who protest when the President proposes to regulate capi talization. These are the men who inveigh against "centralization" il governWent. These are the mer who declare that the President: policies are disturbing business. Amen to the disturbance of sucf business as many of these financiers are engaged ins say the people.
 New York is well equipped through it's Public Utilities Com, mission. to cope with it's own great problem. Missouri has put in the