New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1914-07-01
Edward w. Townsend De-
CIares Terminal Road
Is Being Looted.
WRECKED. HE SAYS.
BY HIGH FINANCE
New Jersey Member Urges
House to Order Investigation
by Commerce Board.

Washington. June 30.-ln speech
and resolution in the House to-day
representative Edward ". Townsend,
New jersey Democrat. demanded an IN
vestigation by the Interstate commerce
Commission of the financial AFFAIRS OF
the Wabash Pittsburgh Terminal Rail-
way Company. which, he alleged, was
being looted" by methods or high
finance.
Mr.. Townsend quoted Wall Street
informant as saying that the lootIng OF
the Wabash Pittsburgh Railroad dill
fered only in intent from the New
Haven lcoting." The New Jersey mem
Der declared that first mortgage bonds
Of this company, which sold TO various
insurance companies. savings banks
and private investors at from 80 to 92
cents on the dollar, were recently
quoted at only 7l2 cents on the dollar.
In his speech Mr.. Townsend said:
Here. in stock exchange tgures, Is
the story of the wrecking of the
Wabash Pittsburgh Terminal Railway
Company. whose bonds were disposed
of at from 90 to % and bought by many
life insurance companies, savings banks
and numerous private purchasers. who
wrecked and have been unable to Sc
cure aid or restitution.
Prior TO 1904 the Pennsylvania Rail
road and its allies enjoyed practically
a monopoly of the freight business of
Pittsburgh, the greatest freight pro-
ducing centre in the country. The
great shippers of that city, including
Mr. Carnegie, determined TO provide
real competition both in freight and
passenger business at that point, and
with the promise of substantial patron
age financial operations were carried
on to provide ways and means which
would give that competition so much
desired.
"WIthout now going into the details
Of the preliminary work, It seems
necessary only to recall that the Pitts
burgh- Toledo syndicate was formed,
whose managers were George Gould.
Joseph Ramsey. jr. tthen president OF
the Wabash Railroad and OF the Wheel
ing & Lake Erie Railroad), Louis Fitz-
gerald. James HaZen Hyde (of life IN
surance investigation fame) and Myron
T. Herrick. now United States Ambas-
sador to France.
This syndicate bought, through
Washington Conner, as ] am informed,
81 10 OF the stocks Of various classes
of Wheeling & Lake Erie Railroad
Company and built line of railroad
from Pittsburgh to Jewett, Ohio. some
sixty miles. making a connection at
Jewctt with the Wheeling d Lake Erie,
which system connected at Toledo with
the Wabash system and thence TO the
Pacific Ocean. 1t was also understood
IN 4 connection would be made with
the Western Maryland and with the
Atlantic seaboard.
"The property acquired and CON
structed by this syndicate was turned
over to the Wabash Pittsburgh Termi-
nal Railway Company. In addition to
the Jewett line and the controlling
ownership in the Wheeling Lake
Eric. turned over by the syndicate TO
the Wabash Pittsburgh Terminal Com
pany. the latter acquired the stock OF
the Pittsburgh Terminal Railroad and
Coal Company, which owned the West
Side Belt Line, twenty -mlle railway
furnishing connection with the lmpor-
tant freight producing Industries OF
Pittsburgh and other railroads. Inc
coal company also owned l5,O0O acres
of Pittsburgh seam coal lands, much
surface land and several coal mines
living on the belt line.
"The total cost of all this property
has been estimated by an expert, IN
whose judgment | have entire conf,
dence, at approximately 5O,OOo,0OO
over and above some liabilities as
sumed. Part Of the acquisition of this
property was through purchase direct
~ by payment of the purchase price
in bonds and part through funds de-
rived from the sale of bonds through
New York bond houses referred to
above"
ION the whole, it is my Judgment
that the terminal property would be
more valuable than its cost, either to