Denver labor bulletin., 1915-10-16
ANTHRACITE DIPS
UPLOTS OF WATER
Government Report DisCloses
Many Inflated Deals
Interstate Commerce CommissionMakes
Public Result Of investigations
Covering Several Years

The record of the Interstate Com
meree Commissions hearings in the
anthracite rate cases, formally made
public after years of investigate June
30, 1915, reveals many inflated" deals
in the progress OF the big companies
perfeeting complete monopoly of an
thraeite coal production.
just now when the time for contract
negotiations is drawing near, when min
ers and operators will again meet,
miners hopeful OF securing increased
wages and improved working condi-
tions and operators just as hopeful that
they viii be able to persuade their en-
ployes that trade conditions will not
warrant such betterments, a brief re-
view Of some of the more important of
K the 1watered transactions" will be en-
tightening TO the consuming public who
always pay the tax imposed by specula-
tion in addition TO profit on the prod
uct
7 The fertile brains OF the nations
master minds found the speculative
/ opportunities of the anthracite region
uneXplored. Their successful execution
OF gigantic deals that have followed and
the tolls taken in some of the trans
actions. j. abundant proof that when
] they had concluded their organization
work. the exploitation had been thoro.
Morgan Finds a Way.
In lsa9 the Pennsylvania Coal COM
'pany. the largest of independent COM
/ panies also owner OF 81 per cent of
the stock OF the Erie and Wyoming. a
short road, proposed to other independ-
ent operators that the line be extended
and that if necessary a new company
be organized to build road to extend
to tdewater ports. This proposal re-
suted m the organization OF the Della
ware ALLEY and Kingston Railroad com
paiy The larger companies cortrollee
by uterlocking directoratrs strongly op-
posi- the application OF tine Delaware
VALLEY and Kingston railroad before the
Railroad Commissioners of New Jersey
for a certificate permitting construc-
ton They saw in the construction Of
this proposed road an outlet for the
produgt OF independents that meant re-
liei rom ;he oppressive freight rates
AMI other transportation charges levied
by the combine.
Engage Master Mind"
The organization work progressed rap
idlV The Pennsylvania Coal company
subscribed S250.Oo0 for the initial stock
( so that the survey might be started.
I Tho combine however. secured the
master mind OF ]. p Morgan. who
cam to the rescue. and while the pro-
I ieci was being developed purchased for
the Erie Railroad Company the entire
capital stock of the Penns yivania Coal
company. delivering the following
curities:
Capital Stock of Shares Par Value
pemsylvania Coal Co. 100000 5000 900
Erie 4 Wyoming r. r.
0
Delaware Valley &
Kingston r. Il. Co, $500 25o.oco
Total lI7,7oo s6.olo.ooo
Purchase Price Unknown
The purchase price paid by Morgan
for the three properties i unknown.
But the Erie Railroad. for whom Nor
gan negotiated the deal. issued to j. 7.
Morgan and Company s5.00o.0oo OF its
irst preferred stock and s52.oo0ooo
Ene Railroad companv's Pennsylvania
Collateral per cent coupon gold bonds.
hus the Erie Railroad company paid
Morgan and Company premium Of $50
100000 ON this one transaction
The, tremendous profits OF anthracite
cnal mining was. however. again demon
strated by the transaction. for the Erie
has succeeded in paving the bonded in
the total inflated valuation OF S37 600.
90 which represents the par value of
the properties purchased and the pre-
MUM paid Morgan. ont of the profits
armed by the Pennsylvania Coal COM
ANY.
In November. lo05. the Coke Broth
rrs company. the largest remaining com
pany of the independent operators. was
purchased by the Lehigh Valley Rail
road company. The Lehigh paid Sl..
10000 for the capital stock. of when
the par value was S2.al0.l5o OF the coal
cimpany and that of the Delaware. Sus-
duehanna 4 Schuylkill Railroad 81 .Soa.-
I 600, owned by Coke Brothers. which also
Z figured in the transfer.
Labor Must Pay Dividends.
For this premium of sli.ooo,ooo paid
I by the Lehigh Railroad for the Coke
/ properties it has no equivalent asset.
7 The Lehigh has continued. as in the case
oi the Erie. to pay large dividends from
the operations OF its mining properties
and also carrier lines, Notwithstanding
1 this single purchase added fourteen mil
I lion dollars of water upon which divi-
( dends and interest charges have neces
sarily had to be paid.
Anthracite mine workers point to the
Pennsylvania and CoNe purchases as
Illustrative of the history of anthracite
coal deals upon which their labor must
pay dividends. The miners maintain
/ that il the water was squeezed from
the industry, coal prices could he re-
dnced to the consumer. so per cent
increase given the employees. and even
then the enormous dividends of the op
erating companies would continue to
climb upwards.
You will never miss a train il YOU