Evening star. [volume] (Washington, D.C.) 1854-1972, 1908-03-03
M'CREA ON THE PANIC
HEAD OF THE nPENNSY" LAYS
BLAMES TO LEGISLATION.

NEW YORK. March 3.-Recent federal
and state legislation Is called one of tae
principal causes Of the October financial
panic in the annual report of James Nc
Crea of the Pennsylvania Railroad Com
pany to the stockholders Of the company.
which was made public today. He says
that the check to general business. which
came with the financial disturbance. has
already largely affected the revenues Of
the system, and that the condition is
likely to continue until all the questions
at issue have been fairly adjusted.
while a number Of causes seriously dis
turbed confidence he says. land thus
brought on the financial panic, which has
| SO sharply affected the business interests
OF the country. an important one, un-
doubleday. was the fear that. as the rc-
suit of recent federal and state legislation.
the regulation of the railroads had ap-
preached SO nearly to an effort to con-
troll their management and revenues that
the investments therein were not assured
OF that protection to which they are
justly entitled.
Adjustment of Question.
Eventually, 1t may be assumed. the
questions that arise may be fairly 40
justed. but in the meantime the railroads
have to face the loss of revenue conse-
large portion of their equipment. while
to proportionate number of their en-
ployes this has necessarily brought about
either an entire loss of employment or a
material reduction in their hours of
labor"
The report says that figures now at
hand show clearly that the lower pas
senger fares which have prevailed during
| portion Of the year have not stimulated
extent offset
the loss of revenue and the higher cost Of
operation, due to increases in wages and
cost of supplies. The cost per passenger
mile for the year is said by the report to
have increased 13 per cent, and the cost
per train mile nearly II per cent, with
the result that there was a reduction of
nearly one-third in the net earnings per
| passenger train mile.
One of the most interesting features OF
| the report Is that which deals with work
| on the New York tunnel extension. This
shows that of the total expended to date
| on this undertaking $3O.OOO.OOO as charg-
ed of. from time to time, against the
companys profit and loss account. The
report says also that it is expected that
| the entire work on the New York tunnel
and terminal station will be completed in
1910.
Roads Financial Statement.
The financial statement shows that
gross traffic earnings for the year on lines
directly operated were $164, So, SIS, an in
crease of $16.572.943. as compared with
1906 The operating expenses. including
taxes. were $123. 1912. an Increase OF
| SIS, O65, 1874, leaving net earnings from
operation Of $41.226.313. a decrease OF
81. 49,. SOL. The companys otter income
| including interest on its Investments. etc.
amounted to $13. 1914, 1O6. an increase OF
1.OO9, 844. After deducting payments for
| rentals of leased roads. interest on bond
| ed debt and other charges, which in
| creased $3.527, 100 during 1907. the COM
pany's net income for tine year was $33,
| SIS. 056. decrease of 81 O98, 2A
The balance to the credit of the prot
and loss account for the year after divi-
dends. sinking fund, expenditures. etc..
| was $2.351 .423. This together with profits
| amounting to S4.64s.576 from the North
ern Central railway stock dividend, adj
justment of values Of securities owned In
roads absorbed and settlement of sundry
| accounts. added to $24374,O6O to the
credit of profit and loss on December 81
| 1905 gave a total credit balance to profit
and loss of $31. 374. 900. Against this pal.
| ance was charged 100000 applied
| toward the construction of the New York
| tunnel line. During the year the company
| issued $6O.OOO,0O0 Of three-year per cent
collateral notes.