New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1916-11-13

uation put upon the same property
bv the Texas Commission itself, so
the quarrel, il any, will be upon
theory and not upon fact. A diff
ference of $4,000 is very little, and
might be treated as confederation.
The railroad management thought
something ought TO be allowed for
intangible elements of value, such,
for instance, as what is called Ego
ing concern value" or good WILL"
profitable connections with other
lines. the desirable location of sta
tions and the favorable features of
its topography, meaning low grades
over which freight may be moved
with a minimum expenditure of mo-
tive power. All of these things
would enter into the value of bust
ness one might think of buying, but
the Interstate Commerce Commits
sion refused to allow any of them,
and the railroad did not insist. The
valuation was based upon the cost
of reproduction, less depreciation"
which means first to imagine rail-
road dropped out of heaven new on
the same right of way and with all
the same features, and then to de-
duct something for the wear of use.
That is depreciation. The instant a
man has finished building a thing a
conspiracy begins on the part OF
time and the elements to destroy it.
II it is a house or a pyramid it will
be utterly ruined in time; if it is a
railroad 1t must be kept going, and,
therefore, renewals Of rails, OF ties,
of ballast, Of buildings, etc, must
be continually made.
The Texas Midland was the lame
darling of Mrs. Green's investments.
She fed it, mothered it and kept 1t
solvent. Certain concessions were
also made to the Texas Midland
Railroad by Mrs. Green and her
son." says the Interstate Commerce
Commission. (which should be re-
ferred to here, although not perhaps
properly donations" in the sense in
which land and money to the value
of $4,000 had been donated by citi-
zens along the way to get the rail-
road built in the first place. Then
the commission solemnly sets down
100 boxcars given by Mrs. Green"
Other items of like character are in
terests and coupons surrendered by
Mrs. Green for cancellation (be-
cause she hadn't the heart to take
anything OUT, advances by the
Texas Midland Construction Com
pany cancelled and freight charges
on coal donated by Mrs. Green"
After this one would not contend
that the Texas Midland was typical
railroad property. 1t would be rash
to generalize as to railroad proper
ties in general from the results OBJ
tanned by submitting this one to the
test of a physical valuation. The
fact remains that large Texas COM
munity has received more railroad
service than it paid for. "This
road" says the Interstate Commerce
Commission, runs through a fertile
agricultural community and has
upon its lines several towns of con-
siderable size. No mines and but
little manufacturing are tributary to
it." And during twenty years it has
averaged to earn IA per cent on its
value. Instances will vary. More
Of this in some degree will be found
elsewhere, and then again perhaps
none of it in other places. Roads
that were badly placed economically
will probably be found to have cost
more than they are worth, because
they have had to be kept going
whether they were profitable or not.
Others may be found to have cost
less than they are worth. 1t is
doubtful if any long established road
will be found that could be imagin-
ably duplicated for its present CAPT
talization. Fancy duplicating the
New York Central, with its right of
way down Manhattan Island to the
heart of the city! 1t grew, as a
tree grows.