The Bridgeport evening farmer., 1909-09-30
FARMERS MIGHT INVEST
EUROPEAN MONEY WOULD BE
 ATTRACTED, TOO


 This Providing Government Control of Capitalization in Some Form Were Back of the SeMrity-Favored by Secretary Wilson.
 Washington, Sept. 3O.-Secpetary of Agriculture Wilson is the latest to come forward in support of the idea of government control of railroad cap italization, which President Taft has advocated and which will be one of the most prominent questions before Congress next winter. Secretary Will son says he has long been convinced that the farmers of the country would invest heavily in the railroad securi- ties of the country if there was some form of government control of capital ization which would assure them that their investments would be safe.
 Secretary Wilson has been out through the West and has been inn pressed anew with the prosperity of the farmers and the fact that they have a great deal of money to invest. He says the fact that they are pur- chasing so many automo piles is a pretty clear index to the situation. Having plenty of horses, they do not need automobiles, but they in many cases have plenty of surplus money on hand and little opportunity for in bestment. The result is they buy al- tomobiles, which in MT. Wilson's view is money wasted for a farmer. It all points, he holds, to limited fields for satisfactory investment of money and he feels the railroads of the country would gain the support of a vast amount of capital now weH-nigh idle in the agricultural communities if the capitalization control were vested in the Interstate Commerce Commission or some government board.
 This is substantially the same idea presented not long ago by Interstate Commerce Commissioner Franklin K. Lane on his return from Europe, when he asserted that hundreds of millions of dollars of European money awaited investments in American railroads providing the government established control of capitalization. Judge B. H. Gary of the United States Steel Cor poration in an interview has recently pointed to the fact that European capita is eager to find investment in this country, though he made no ref erence to government control of capi- talization.
 Such utterances as these point to the fact that one of the chief argu- ments which will be exerted next win ter to get Congress to enact legisla- ton for the government control of tions, will be that it will be of vast benefit to the railroads and corpora tions themselves to have the govern ment placed in the attitude of seeming to stand sponsor for the satisfactory character of stock and bond. The complaint often heard from railroad sources is that enormous sums of money are needed to finance exten- sions and improvements and that it is a serious question where the money is to come from. Government con- trol of capitalization will be urged as the ar, SxUar tn this OuaStiOn.
 The great difficulty in getting Con- gress to do anything with control of capitalization will arise from the fact that a controversy will be stirred up just as soon as the question is taken up as to whether control of capitali- zation should be confined to future is- sues of stocks and bonds, or whether it should go back of the face value of existing issues and find out if they are watered and squeeze the water out of them if it exists. To legislate for government control of future issues would amount in effect to legalizing existing issues.
 It is known that Senator La Toilette is prepared to lead an unrelenting fight against the plan to limit the con- trol to future issues. He will urge a physical valuation of the railroads as a. preliminary to control of capita1iza- tion. The Interstate Commerce Com mission has already recommended a physical valuation of the railroad properties. It made this recommen- dation for two reasons: one, owing to the importance which the question Of capitalization has assumed in recent years; the other because the correct- ness of capitalization cannot be de- termined without a valuation, and capitalization has a large bearing on rates. The commissions attitude leans strongly to the idea that both existing capitalization and future is sues of securities ought to be deter mined on the basis of an actual valua,- tion of the railroad properties. But any such proposition as this will pro- yoke the ardent opposition of the con- servatives in both branches of Con gress.
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