The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1907-07-14

itthN Nc hiiu oEuNIi, WIS given equal fRCil- 4
tiles over the Central Pacific, and
thereby practically formed another
transcontinental lire. Since the anal.
gamation of the Union Pacific and
Southern Pacific, and the construction
or the San Pedro road, this line has
been denied equal facilities in thes re
ceipt of transportation OF freight over
he4Central Pacific and tho San Pedro
lines. Its business, therefore, has de-
creased. and its ability to compete with
the Union Pacific and Southern Pacific
impaired. On this account the Gould
limos are aiding the construction OF an
other line from ogden,fto San Fran
cisco
The Joint control or the Alton Rail-
way by the Union Pacific and the Chi
cago, Rock Island and Pacific Railway
Company, has undoubtedly eliminated |
competition between the Alton and the|
Z Rock Island between Chicago. st. Louis
and Kansas City.
These are conspicuous illustrations
OF the development OF the theory OF
community Of interest" and "harmonyI
of management" which Mr.. Hartman
suggested when he demanded repre-
sentation upon the Santa Re board.
II the policy Of purchasing and con-
trolling stocks in competing lines is
permitted TO continue. 1t must mean
suppression of competition.
VI Ine function or railroad cor
poration should be confined to the
furnishing. Of transportation Rail-
roads should not be permitted to in
vest generally In the stocks, bonds and
securities OF other railway and of
steamship companies, except connect
Ing lines, for the purpose Of forming
through routes OF transportation, In
GLIDING branches and feeders. 1t Is IN
| the interest of the public to facilitate
the consolidation of connecting lines.
The credit OF railway company is
founded upon the resources and pros,
perfty of the country through which
It runs. Its surplus funds and credit
should be used for the belterment of
It's lines and In extensions and branches
10 develop the country contiguous to
IT. The testimony taken upon this
hearing shows that about $4,000 square
nllles OF territory In the State of Ore
gon, surrounded by. the lines Of the
oregon Short Line Railroad Companv,
me Oregon Railroad and Navigation
company. and the Southern Pacific
company, Is not developed; while the
linus OF those companies which could
pc used for that purpose are heinz
invested In stocks like the New YORK.
Ientral and other lines having only
remote relation to the territory IN
Mnich the Union Pacific system is To-
railroad securities should he s,fe
ana conservative investments for 80
p ps;,p 10 this end the risks OF the
raiiroad i should be reduced to a mini.
saa,,,.,., livery one knows that railway
securities huctuate more or less 90,
cordfns to the prosperity or tbs ,,,,t -
ana also by reason of the wide snac'
uiatlo In such securities,
therefore adds an element ~
$500. TO railroads capita, ana
suit 70 nave Its funds inves+a, ~
ne STOCKS of other companies. thereh ~
.nus q serlng its solvency and It's AMI
;t.y 70 pay reasonable dividends mon
menu "" eapltal stock. 1t is a serious
menace to"the- ftnancia l. Condition Of
| me country toshave large railway sys.
telils 1all to meet their OBLIGATIONS m
20 into the hands Of receivers ana
the object of legislation and admins.
tratlon should be to lessen the risks
OF railway investments.
W IT is contrary to public policy
Wen S unlawful, for railways to
| acqulre. control OF parallel and com
petlng lines. This policy lie. expressed in
me Federal laws and in the Consttu-
| tons and laws of nearly every State in
the Union. We have examined the Con-
situations and laws OF alls'the States,
ana ma In about forty. of them prohibit
tons against consolidation of capital
stock or franchises of competing rails
ways, or the purchase and acquisition
! by q railway of competing lines. Com
petition between railways as we'll as
between other .rdrstries Is the estab-
lished policy of the nation. And while
| the acquisition of small minority Of
! the stock of Competing line might,
10: decrease the competition. yet the
acquisition Of any considerable amount
of stock. with representation on the
board of directors of such railway,
Enthusiastically has the effect Of dimin-s
fishing competition and lessening to
! that extent ats effectiveness b
So lonE as It is the policy OF the general
/ government and Of the States to maintain
competition between naturally competing
railway in competing railway should not
be permitted, and such lines OF railway
should be prohibited from having any COM
| mon directors or Officers.
g.. The time has come when some rea-
/ sonabe regulation should be imposed upon
4 the issuance of securities by railways en-
/ gagged In Interstate commerce. We are
i aware that In the construction OF new lines
been necessary in many instances to sell
railway securities at large discount, and to
sell bonds with stock bonuses. and even In
such cases 1t has many times been diff
cult to raise the necessary capital Men
Will not invest their money and take the
risk for small rates OF interest.
I But this principle does not apply to old
credit. such railways should be prevented
speculative purposes. Railroads should be
encouraged to extend their systems and de-
! Importance, also that railway securities
should be safe and conservative invest
ments for the public, and should yield good
!. and ample return tor the monay invested.
Reasonable regulation will tend to make
them sater and more secure
. companies but the public.
SAWS REPORT is