New Britain herald., 1915-02-27
PUT NO ADDITIONAL
 BURDEN ON RAILWAY
Organization Of Holding Companies tO Control Railroads.

H Washington. Feb. 27.-Daniel G. IReid, head of the group which took
 control of the Rock Island railway system in 1901, declared yesterday at
 the interstate commerce commission s
 investi gation of the roads financial
 affairs that organization of the two holding companies put no additional burden on the Chicago, Rock Island
 and Pacific Railway company. .@s MT. Reid's examination was con-
 cluded and his assertion that the hold
 ing companies, with total capitaliza- =
 ton of $350, 100000 had not added to
 the burdens of the operating concern Y came during his cross examination, E which was very brief. He did not know the amount of the commission
 or what had become of the stock
 Conditions Have Changed.
 During his direct examination MT.
 Reid asserted that conditions has so changed in the railroad world of re-
 cesft years that he would not now ac- i, cept as a gift control of any western pr southwestern railroad.
 When you cut the earning powers < of railroads by fixing rates, and every thing else goes up in the way of taxes,
 conditions are worse,'' he said, 'I am
 not complaining of the wages we must [ pay but of what we get to pay wages
 with
 Paid High Salaries. Joseph w. Folk, chief counsel for the commission, pointed out that of ficers of the company had received
 during the period under investigation salaries ranging from $125,O00 down to$25,0O0 a year. ... "There was not a man there who was not worth what he was getting.' said Mr. Reid. .. Mr. Folk pointed out that R. A.
 Jackson, a retiring director got a present of $10O,0O0 from the company ! in addition to a salary of s25,00o. MT.
 Reid said Jackson had been paid $50,- l 900 a year, not s25, 1000, and the s10c,
 900 was for "services rendered"
 Need More Rates. .. Later MT. Reid said that what the railroads needed was More rates, mole tariffs and less legislation" Commissioner Clements interposed with the observation that possibly what was needed was more legisla- tion to protect the public from securi- ty issues devised by lawyers"
 a MT. Reid said that the purchase of the Frisco Lines had cost the Rock Island SIC, O,0OO,0OO. and he described it as a "regrettable mistake" Pur- chase of the Chicago, and Alton, he ad- mitted under questioning, had cost the company another $6,0O0,000, saying the Clover Leaf bonds, while mot
 now known in the market sense," might work out" under the re-
 ceivership.
 z t'When those bonds were taken," he said, they could have been sold to any banking house in New York at , a price. We don't, know what they are worth today, and nobody else does'
 Suggested by Leeds. The Alton deal had been suggested by William B. Leeds, now dead, MT. Reid said, as had been the holding company plan. It was Leeds, also, . he Said, who had led him into his
 original purchases of more than $6,- 900, 600 in Rock Island securities. ITO be frank, I was foolish,'' said
 MT. Reid. He added that he was, khimself, the greatest loser in the whole Rock Island transaction, so far as he knew. When he and his as- sociates took over the line, he said, they found it to be a "streak of rust, B joke"
 Nor Folk called attention to the $S,000,00O surplus the read then had Surplus But No Railroad. That's all it had" Reid replied Tt had a surplus, but no railroad" 6n his cross-examination MT. Reid said David Lamar had sought to reach him by telephone in January, 1914 but he had refused to have anything to do with him. Later he was told Lamar wanted to tell him that speech Woudl be made in congress against
 the Rock Island Counsel for MT
 Reid then placed in evidence the con-
 gressional record showing the speech
 of Representative Green of Iowa, urg- ing the investigation and presenting i resolution calling for action by the interstate commerce commission. Rep. resentative Green sat with MT. F'oll
 during the hearing.