The Bemidji daily pioneer. [volume] (Bemidji, Minn.) 1904-1971, 1914-07-21
SOON TO EXPOSE
STORY OF GRAF 7
Railroad Financial Crookedness of
Several Roads to Become Public
N. H. Sensation Beginning.
UNO0vER1NG OTHER SCANDALS
Interstate Commerce Commission Pre-
pairing Investigation of G. H. & D.
Line-History Of Pittsburg Line
BY Congressman G. H. Tavenner.

By Congressman G. H. Tavenner.
Washington, July .21.-The indi-
cations all are that this country is
on the threshold of the greatest ex-
pose of railroad financial crooked
ness that has ever been made The
inside Wall Street history of the
railroad financing of the past dozen
years is about to be told to the pub
lie, and it is the opinion of the writer
that the cumulative effect of the
evidence of wholesale theivery will
be to land some of the rich thieves;
in Jail at last.
The New Haven sensation is but
the beginning. Even now the In
terstate Commerce Commission is
preparing for an investigation of the
c. H. e D. railroad that promises
to uncover a scandal. The Frisco
is another road which will come in
for it's share of the scrutiny. And
now the Interstate Commerce Com
mittee of the House is uncovering
another bit of railroad finance that
will add to the enraged public's
eagerness to know the whole truth
about railroad finance.
From evidence submitted before
the House Committee the assertion
is made that the Wabash Pittsburg
Terminal Railroad Company, an
exceedingly profitable road only a
few years ago, was deliberately
wrecked in order that powerful
group of Wall Street railroad men
might buy it cheap. The job of
wrecking, of course, resulted di-
sastrously to the investors in this
railroads securities.
The Pittsburg Terminal railroad
owns nearly a hundred miles of track,
coal mine or two, possesses valuable
rights of way in Pittsburg, and was
party with other lines entering Pitts
burg in traffic agreement which were
exceedingly lucrative to the terminal
railroad.
, AS late as 1908 this road was pros
pering. It's bonds, over $3O,000,000
of them had sold for as much as 81
cents on the dollar par value: They
had been eagerly bought as investi-
ments by savings banks and insur-
ance companies, widows, and ex-
ecutors investing the proceeds of
estates for widows and orphans.
But about that time the greedy
eyes of the Wall Street inanciers
fell upon this property, and for some
reason yet unexplained they decided
to acquire it. Oh, no. First it must
be wrecked And it was, deliberate
ly, it is charged.
First the railroads with which it
has the profitable traffic agreements
sought excuses for cancelling these
agreements. The former president
of the road, George Ramsey, Jr., of
St. Louis, told the House committee
that federal judge aided in the
cancellation of one of the most pro-
ftable of these traffic contracts
the one with the Wheeling e Lake
Erie Ry. This road was in the hands
of receiver, who asked the judge to
cancel the agreement. He did so.
Later he sanctioned similar agree
ment between the w. & L. E. with
other roads. Then he resigned from
the bench to take partnership in
the law firm which handles the W.
e L. E. affairs for the receiver
But the cruelest blow came from
another direction. The Pittsburg
Terminal Company needed $4,000
900 cash for some improvements
Ramsey, who was president, was
dumfounded with the directors sug-
gestion that this huge sum be
borrowed on 2-year notes. He pro-
tested that such loan would throw
the road into receivership at the
expiration of two years. He sug.
gested long term mortgage bonds in.
stead, but he was overruled.
Then he went to New York tc
plead with the magnates who were
pulling the strings. From them he
finally secured the promise that the
$1O,O00,000 would be borrowed on
bonds and not notes. Thinking he
had saved the situation he left fol
his home in st. Louis. He had
scarcely arrived there when he re.
ceived telegram requesting his
resignation as president. hi, 49,. !
He resigned, and the $1O,0O0,00(
was borrowed on notes. At the ex.
piration Of two years the maturing
of these notes brought about the
receivership. The bonds, which hat
sold for 81, fell and fell in value
until today they are quoted at sever
cents. The investment of $4,000,
900 in these bonds in now worth
slightly over $4,000, 900. 6
.% Artificial rubber as a by-produc
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