The sun. [volume] (New York [N.Y.]) 1916-1920, 1919-10-24
RAIL VALUES TO
EXCEED CAPITAL
Roads Appraisals So Far Doom
Dreams of Government
Ownership.
NO WATER IN NEW HAVEN
Boston and Maine, for Exam
pie, to BE Listed at Double
It's $5O,OOO,OOO.
NO WATER IN NEW HAVEN
Special Despatch to THE Sus.

WASHINGTON. Oct %. While the
work Of valuing the railroads Of the
country is in progress, and the tre-
mepdous job should be finished within
four years, 1t has gone far enough al
ready to make 1t appear certain that
the dreams of schemes of the Govern
ment ownership zealots. the plumb
plan" crew and the like are scheduled
for a rude awakening.
The Plumb plan, for operating the
railroads by the Government for the
benefit of the railroad employees
mainly, as well as the plan of the
Government ownership advocates, is
based on the theory that the outcome
of the valuation work will show that
! the actual value of most If not all. OF
the railroads is a great deal less than
their capitalization.
The valuation work has gone far
enough to indicate with considerable
clarity that instead of railroad capital
appearing to be watered there will be
shown an actual value of the railroads
higher by a considerable margin than
the capitalization.
Some Tentative Totals Found.
No final figures have been placed by
the commission, and tentative totals
have been found only in the case of hall
| a dozen or more of the smaller roads
such as the Texas Midland. Neverthe
less. on many of the big railroads th'
| work has progressed to such point a.
clearly to indicate that final values will
probably In the aggregate considerably
exceed railroad capitalization.
Howard Elliott, president OF the North
ern Pacific and formerly president o
the New Haven road. is authority fo
| the statement that in his judgment. wheI
final figures are reached, a value will
be given to the Boston and Maine Rail
road OF upwards of 500. 100000. agains
a capitalization of 35O,O00,00O, and tina
| the actual value Of the New Haven will
| be found to be In excess of the outstand
ing capital. The New Haven freQuenti.
! has been held up as horrible example
of watered stock.
On the other hand. in the case of tn
Kansas City Southern, the Tentative
values given indicate a final valuation
| far below the capitalization.
Railroad officials are in PRACTICAL!
every instance fully acquainted with tn
| figures on the various items of valu
reached. Each railroad has a corps o
men cooperating with the valuation mel
of the Government in the finding ant
fixing of these values. giving them cor
rect line on the trend of the work.
| Surprising Results Predicted.
1t Is upon this information that som
| of them base the belief that the final re
| suit will astonlsh those who have beel
! travelling upon the theory that the Capi
talization OF the railroads of the countr,
| as whole was far In excess OF the Valu
| Of the properties. So far as the publ
is concerned these figures are confiden
tial, however. until they reach some fins
form, and they will not be made publ
In an uncompleted state by the commits
sion
Director Prouty in charge of the valu
| alton work of the commission, will max
no predictions, declaring the work is no
| sufficiently advanced for any analyst
that might be regarded as reliable. Whe
he was before Congress a few month
ago urging the appropriations whiol
| were made for speeding up the valuation
work he was questioned by members o
the House Interstate Commerce Commit
tee as to the results shown. and state
then that he could draw no conclusion.
On many roads, however, figures so ia
compiled, including many principal item
of value, such as equipment. tracks an
terminals. when put together make
total that seems to assure final valua
ton In excess OF capital issues.
SO far valuation figures have bee
confined to reports OF original cost O
roads, cost of reproduction new. less de
probation, and costs of lands new. wit
their present estimated value. On thes
findings ultimate totals will be based
On most OF the railroads OF the oountr
terminals and other lands in cities hav
appreciated greatly.