The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1908-08-01
LONG AND BRlST0W MEET
Continued from Page one.)

Continued from Page One.)
places a mortgage on the resources of
that country for which he gives moth
ing in return, and when this money
is appropriated by its officers to them
selves in order to increase their per-
sonal and private fortunes, they levy
just and indefensible. And any sys-
tenn which permits such business oper-
alton is not only unwise but dishonest.
The president has recommended that
law be enacted forbidding such
practice, but Senator Long in his votes
in the senate has uniformly voted
against changing this Infamous meth
cd of business by making over-capi-
talization unlawful and criminal"
Mr.. Bristow then quote extensively
from the presidents messages and let
etrs showing his attitude on overcapi-
Longs votes against limiting such
capitalization contrary to the recon-
mendations of the president. Con-
tinuing. Mr.. Bristow said:
Valuation of Railroads.
ct also declared in favor of giving
the interstate commerce commission
authority to ascertain the value Of the
railroads. What is the value of rail-
road? Take the Missouri Pacific. that
| is the main line, that part of the sys-
which does ont include the collateral
lines. 1t has according to a statement
I have here from the Interstate COM
merce commission an interest bearing
Indebtedness of about $4,000 mile,
and in addition to that a stock indebt-
edness of more than $4,000 a mile.
| making a total capitalized indebted
ness of more than $4,000 mile.
Upon this last year 1t paid the inter-
est on its interest bearing indebtedness
~ hi al tut
dends on its stock. In the report of
| the state board of railroad commits
| sioners for 1903 and 1904 the Missouri
Pacific road stated to the board what
struction and equipment down to June
| 80. 1904, which aggregated $57,682 a
mile. or almost $4,000 a mile less
than its interest bearing Indebtedness.
A competent railroad contractor told
| me not long since that he would agree
| to reproduce the Missouri Pacific rail-
road as it is today for $4,000 a mile.
| The supreme court of the United
States has decided that congress has
the authority to fix the rates which a
serving it, but in fixing those rates
three things must be considered:
First. the road is entitled to earn oper-
| ating expenses; second, an amount of
make necessary improvements: third,
a fair return in interest and dividends
upon the value of the property. Now,
how much is the Missouri Pacific rail-
road entitled to earn interest and divi-
| dends upon according to the supreme
court decision? who knows? Under
| our new tax law the property of the
| state is assessed for what it is worth,
what it would sell for under normal
conditions-its actual value.
"a farm worth $4,000 is assessed
$4,000: a team of horses worth $3.50
is assessed for $3.50. and under the law
| the railroads are required to make a
| statement to the state tax commission
giving the actual value of their lines,
| and the highest valuation placed on
anv part of the Missouri Pacific rail-
road In its report to the tax commits
sion was s22,5o0 per mile. Now. how
much under the supreme court de-
cision is the road entitled to earn
interest and dividends upon? $2250O
per mile. is reported to the tax COM
mission? $35.O0O a mile, the amount
for which 1t can be reproduced ?
$4,000 mile. all that It claimed
to ever cost? $4,000 mile. its inter
est bearing Indebtedness. or $4,000
a mile. the full amount of its capital
| ization?
who knows? For ten years the in.
! terstate commerce commission in every
| annual report that it has filed ha.
| asked congress to give 1t authority and
means to ascertain the actual value o,
| these roads? The president has declar.
| ed In favor of 1t in numerous speeches
| and recommended 1t in two messages
to the last session of congress. YET
| Senator Long has continuously voted
| against giving the commission sucr
means. In his Wichita speech he de.
| clared that he was not opposed to the
valuation of the railroads If the valua.
ton was made for the proper purpose
Are we to infer from this that the
senator believes that the commission
| in Its various reports and the presi
| dent in his recommendation hav,
sought to have such valuation made FOL
! improper purposes? The commission IL
its last annual report said:
From whatever point of view thi.
question of valuation be regarded
| whether of reasonable capitalization, o
| a reasonable schedule of rates, of effec
| tive administration of the depreciation
| of the balance sheets. one is forced t,
conclude that an authoritative valua
| ton Of railroad property is the mex
| important step in the development o
governmental supervision over railroa,
| administration
commission in asking this authority 70
the purposes named was asking it 70
improper purposes? Is that the reaso,
that he voted against the measure an,
| opposed resolution in favor of it be
ing incorporated into the national plat
form?'
Mr.. Bristow then read from a decis
ion of the supreme court Of the United
States in which 1t said:
IF a railroad corporation has bond
ed its property for an amount that ex
ceeds its fair value or II its capital
zation was largely. fictitious, it may no
impose upon the public the burden o
| such increased rates as may be re
uuired for the purpose Of realizing pro
fits upon such excessive valuation O
fictitious capitalization
Further, the court said:
IT corporation cannot maintain
such a highway and earn dividend
for stockholders, it is a misfortune TO
1t and them which the constitution doe