The Detroit times., 1913-03-28
Erb Tells PrObers Property
Could BE Put on Paying
Basis by Aid Of Cash
MANAGEMENT WAS NOT
SCIENTIFIC, HE SAYS
With Exception Of Toledo Ter.
minal Deal. All Transac-
tiOns Were Fair
From a Stan Correspondent.


LANSING. Mich. March 2s.-
That there il q future for the Pers
Marquette railroad under proper
management and that no holder Of
either Its stocks or bonds need lose
. dollar was the opinion expressed
by Newman Erb. OF New York, In his
testimony before the legislative in
vestigating committee Thursday at
tsrnoon and night.
For more than an hour he told
the story Of his connection with the
road a. general manager from 1902
to 1904 and when he came back to
Il for . short time in 1912 At the re-
quest Of large stockholders.
In regard to the rapid increase of
bonded Indebtedness Of the road, he
said. II An just - certain al am
OF my presence here that aside from
the bnying OF the Toledo Terminal
road that every dolla- Q: the funds
from the bonds was properly account
% for.
The buying q the Toledo Terminal
have already told you. was worse
than . mistake In judgment. II COST
the road about 100000"
"Cotter tried to do too much in
1911. He tore up too many lines at
oncs and seriously interfered with
the tramc..
with an expenditure Of go. 600. 900
tho road might b made . paying In
stitution within two years."
Erb stated that when he rejoined
the road in 1912, he found \ debt of
$50. 0O0, 900.
This he thought could b satisfac-
torily explained with the exception of
the Toledo terminal deal, which he
thought was unfair. He denied thar
the 1903 surplus OF @l.et6,o00 waS a
book" surplus only.
"Mr. Erb, do you regard the road
- worth $4,000. DOOR" inquired Sen-
Ator Smith.
.Yss. to me It would be-" was the
reply. ''as . future prospect, but not
- q railroad, with its present deictt.
I don't believe that It is necessary
for . single person to lose q cent.
The road needs . great deal Of mon
ey and courage too. would like to
uave Il for the stockholders, and In
the 50 years I have been In the rail.
road business I have been saving just
such roads a. the Pere Marquette"
Take the road - It stands today.
what could tt gross earnings b.
brought tot"
II don't think II can be increased
much - II stands, but with money II
could be raised from 317 200, 900 to
l1S, 600. 900 In II months"
Mr.. Erb was OF the opinion that the
road had been wise In securing an
entrance to- Chicago.
Wasn't II true Of the Pere Mar
quette." asked Senator Smith, that
Il charged some things to additions
and betterments that should have
besn charged to cost Of operationf"
IT was not
Erb characterised the two cents
per mile rate In Michigan ~ "emi-
nently unfair" He thought the
OF railroads ought to be
based on gross earnings.
When asked to make an estimate
u the cash value of the road, Erb
saiA: I'm the hands Of some men the
road wouldn't be worth 10 cents, to
me. The personal factor IL q great
oue In railroading. In my Judgment
tho management Of the road, during
The Harmon receivership, and for
some time after Il. was unscientinc."
Nrb said that In his opinion the road
could have earned $2.1SS,000 more in
1911. II Il had bean allowed to Charge
the same rates a. In 1902. and II the
cost Of wages had been on the same
basis would have paid dividends and
given e2,000,000 for improvements.
He thought that In order to prosper
n the future, the road should put y
.elf In . position 10 handle moro
tonnage and not depend to 30
great an extent on local trahic In
Michigan.