The Marion daily mirror. (Marion, Ohio) 1892-1912, 1910-12-01
New Management Succeeds
Admirably.
LINE NOW ONE OF THE BEST
In 1895 It Was Quite Dill
apidated.
During the Time of the Rcconstruc-
tlon The Income of the Line Has
Kept Pace With the Improvements
Being Made.

| In the history of the Erie-and more
| than any other American line the
Erie has a history-the reorganiza-
ton of 1895 stands as n dividing line
between the new and the old. The
"old" was the time of Jay Gould and
Jim Fiske ct al, who used to car
ry the Office of the road around in
their pockets and of old Dan Drew,
whose prnting-presses used to be run
| overtime turning out uncounted reams
of stock. The "new" is the time OF
the sober operation of the company
! by group of highly efficient traffic
men. handicapped 1t is true, by their
legacy of mismanagement and over
| capitalization but striving with all
| the power that is in them to make
their great property what 1t ought
to be.
When the present management came
in few years after the reorganlza-
tion. II was tremendous task with
which they found themselves faced
on its record, people had no faith In
| the Erie. It's credit was gone. Its
| equipment and its raod-bed were In
lamentable condition. Worse than that
the new management soon enough
came to find how difficult was eco
nomical operation of a line whose
rails had been laid along the rout,
Offering the largest subscriptions in
stead of the least grade resistance.
To build the necessary cut-offs, and &c
eliminate the killing grades on this
uphill and down-hlll route was pos
sibe enough, but required money-lots
| nf ha did haUa
and could not borrow. Capitalization
and capital are two mighty different
things. The company mad plenty of
the former. but lack of the latter
on more than one occasion during
those early years of the reorganiza-
tion came perilously near sending the
whole property back into bankruptcy.
AS lately as only three years ago,
indeed lack of working capital came
near bringing to naught all that the
new management has done for the
property and throwing 1t into re-
ceivers hands. The panic hit the Erie
particularly hard. Gross earnings fell
Off tremendously while expenses in
creased. Between that upper and
neither milestone. net revenues. which
had been S15,17l 600 i'm 1907. fell off 10
$40 277 900 in 1908. With big issue of
short term notes coming due. 1t look
ed very squaly for IA time. But a.
the very moment of danger, stron.
financial interests stepped in and pro
vided the necessary cash.
How well justified they We're In
their judgment that the road ought
to be pulled through Is seen in the
remarkable earnings shown since
that time. Probably there is not an
other road in the country that can
show so complete a rlght-about-face
in condition and outlook during the
past couple of years as can the Erie.
For the year ending June. 1908, there
had been deficit of $2,2O0,0OO Dur
ing the next twelve months gross
earnings were so increased and ex-
penses were so cut down that in
stead of deficit the road had sur
plus of $2,566000. And during the mex
fiscal year. ending June 1910, the re.
coyery was carried still further. Gros
earnings reached the surprising total
of $54, $685. 900 while operating expenses
were only very slightly increased. TIL
result was that total net income ex-
ceeded twenty million dollars as
against less than twenty million i'm
1908. and that the years operations
ended in the addition to surplus OF
the tidy sum of s5O69.457.
: BY such a demonstration of earn
ing power during a time when all was
by no means sunshine for the other
roads the question Is squarely raised
as to whether the Erie has not turn
ed corner and entered new
phase I'm its existence. Handicapped
IL is true, have been its managers by
: the lack OF working capital, but by
, stripping clean every bone and max
, ing every dollar do one hundred
cents worth of work that difficulty
\ has been largely overcome and i'm
4 provements effected which, under th'
circumstances are little short of mar
veous. Judging from the way earn
ings have been running the past few
\ years the back of the difficulty ha
q been broken, and what has beer
n done for the property is about to bea
fruit.
In deciding whether or not that is 81
there must be continually kept II
\ mind the fact that there are, so t,
y speak, two Eries-the physical Er
a whose strides forward during the pas
n couple OF years are recognizes
4 throughout the railroad world; AM
the financial Erie which still remain
serious handicap to every membe
8 Of the operating staff from the to-
to the bottom.
I Considering first the physical Erie
a glance at what has been done dur
ing the past few years in the wa.
of building cut-offs and bringing
about grade reductions, Is all that l
necessary to see how alive the man
agement is to the necessity of strilS
Il ing at the very root of the difficult
"a by which they have been all alon
beset Competition on even term
with such roads as New York Centra
. and Lehigh Valley, 1t was realized
D was impossible as long as such grade