Newark evening star and Newark advertiser. [volume] (Newark, N.J.) 1909-1916, 1914-05-21
PROBE ALDR|CH'S
PART IN DEALING
WITH NEW HAVEN
Folk Questions Mellen About
Transactions With Former
United States Senator.
Especial to the Evening star.I


WASHINGTON, May 21.-The In
terstate Commerce Commission to-
day continued it's efforts to find out
just why Rhode Island and Connec-
ticut trolley lines. being operated at
loss, were gobbled up by the New
Haven system at inflated prices. So
far as the road is in a combination is
concerned, Charles S. Mellen engi-
neered the deal and very frankly ad-
mitted that former United States
Senator Aldrich was behind the
transaction. Mellen had tried to do
business with the controlling inter-
est, but the price was too high. He
had called all negotiations off.
Then Aldrich went to his office di-
rect from the United States Senate
and asked that the deal be reopened.
When it was closed the New Haven
had the system opened which, since
six years ago, has resulted in de-
ficit of S3,000,o0O Mellen identified
the maps of the roads taken over by
the New Haven. The exact mileage
of each independent system In Con
necticut and Rhode Island with the
price paid per mile was read INTO 1ne
records Mellen admitted thatan each
instance the price paid was hlgn.
Rut he excused it on the ground or
strong competition. He defended the
deals on the ground they were baseo
in MANY instances on the beller OF
future earnings.
MeIlen's story is chiefly dealing
with itemiZed detail now. lie mas
demonstrated emphatically that SO
far as New Haven was concerned u
had many directors, its fate was al
ways in the hands OF TWO or tn,se.
]. P. Morgan and William RockeISller ,,s,l'l.
were always in the limelight. They
were the controlling spirits OF the
finance committees of the New Haven
and its subsidiaries. They deter
mined all purchasers and mergers ana
their fellow directors followed thelr
lead blindly and sheep-like.
ATTORNEY Folg planned today 10
clear mn the trolley deals and get the
inner secrets of the Grand Trunk ar
rangement just how far ne was go
ing to the latter question ne was not
fully decided. Mellen is under lnulLt-
Inert for violation of the Sherman
law in connection with this deal with
the Canadian road TO shut off eompe-
tition. But it is admitted by lawyers
that there is little to fear from tnis
indictment II he Inersate Commerce
Comm ,ssion was inclined to disregard
IT and let the whole story go into the
record for the benefit of the Senate in
considering preventive legislation.
Counsel Folk admitted taht he mac
received suggestions to terminate
the investigatinn when Meilen nm
ishes. The suggestions were based
ON belief that Mellen's story had
nayed the way for criminal prosecu-
tions but it is not believed Folk Will
consent. Commissioner McChord in
sisted that he saw no reason for halt
ing the inquiry.
I'VE intend to go right ahead" Nc
Chord said. I'VE will examine every
person having information of these
deals.'
At the outset today Mellen specif-
ically denied that former Senator
Aldrich had promised to use any
political influence with the Rhode
island trolley deal. He did promise,
said Mellen, ito influence the United
Gas Improvement Company to make
us advantageous terms"
Mellen produced letter written to
Randall Morgan. of Philadelphia, in
which he predicted deficit of $4,000
coo annually for five years in taking
over the Rhode Island trolleys The
total cost of the Rhode Island troll
leys was s20,0O0.oO0 and their physical
value about $8,000000.
Mellen disputed of the Rhode ISL
and's figure to the state department.
showing capitalization of the trolleys
to be 1851, 900 per mile He said 1t
was nearer $50, 900. Folk insisted that
his figures were fair as a grand
average of all lines.
THAT is tremendous fallacy,
Mellen fairly shouted. like many
other tremendous fallacies that have
crept into this case. These figures
are public records, to be interpreted
by anybody in their own way
After the New Haven directors had
turned down both Connecticut and
Rhode Island trolley deals. June 8,
1906 Mellen said Aldrich went to his
home at Stock Bridge, Mass.
1--WE did not want the Connecticut
said Mellen, but we did
want most OF the Rhode Island plants. |
Finally we had to take BOTH"
Mellen's testimony was interrupted
by bugle calls and snare-d drum throb-
bing of Coxey's army which passed
the hotel. Mellen described the Rhode
Island trolley system as q wheel
within wheel" There were various
companies, he said, which held still
other companies.
I'VE had to buy them all up and
shut out competition" he said.