The Washington herald., 1919-03-26
BUILDING COST
TRADE BUGbEAR
Holland Says War Prices
Have Caused Many Busi-
ness Failures.

has been occasioned by conditions
cue to the war. If this be so. then
the situation in which this import
ant surface railroad company now
hnds itself is a matter Of not only
local, but OF national interest. On
the face of 1t, it appears to be one
OF the largest failures to meet OBJ
legations. thereby entailing bank
ruptcy proceedings, which have oc-
CURED even in New York or per-
haps anywhere else in the country.
Possibly some of the bankruptcies
which the steam railways compan-
les have been compelled to submit
to which have been followed by
reorganizations. may exceed in the
amount involved, this collapse.
There are but few transportation
companies in the United states,
Perhaps none which can show re-
port setting forth the number OF
passengers carried which would
match a like report made by the
New York Railways Company.
Many are the conjectures. however,
as to the reason why these bank
ruptcy proceedings should have been
necessary or what they will lead to.
There appears to be an impression
that the day Of high finance has
to that kind Of financing still fingers
may be demonstrated by the expert
ence through which this corporation
and its allied corpora tions-for it con-
trolls some twenty Of the surface rail-
way companies in New York-must
pass. The wonder Is whether this
action does not represent either the
Climax or the beginning Of a strug-
gle. Some of the leaders rep
resent powerful banking interests in
New York, while others represent
fully as influential banking power.
There appears to have been for some
time a suspicion that financial groups
have been lining uD. one on one side
snd one on the other side, seeking on
the one hand new control of the local
transportation interests and on the
other hard seeking to maintain the
present control.
Mr. Shonts and Railroads.
Theodore p. Shonts has many very
stronG and influential friends, and, 1t
Is surmised, has also incurred certain
hostilities. One Of his chief support
e1s is f. ]. Berwind, and he is man
whose influence and authority cannot
be lightly tampered with or ignored
On the other hand. the statement has
not stand we'll with labor. So the
wonder is whether these receivership
proceedings may not have as one Of
tneir purposes the elimination Of
President Shonts and the selection of
another who stands in high favor
%ith strong banking Influences as Mr..
Shonts' successor as president of the
Corporation.
The amount Of inde btedness is
CrpTv large. 1t will be difficult
task for the receiver to untangle
the various threads which have been
utilized in bringing almost all of the
passengers transportation interests
into one control Some Of these
entangIements go as far back as the
day when william c. whitney was
the master OF the New York Surface
Railroads II was said this morn
ing that the unravcIIinE of these
various interviewer interests may
move to he as difficulty a task a.
was that which the bankruptcy of
the Richmond Terminal Railroad
system and then its reorganization
involved. That task proved to he
heyond the ability OF so great a
master in unTavelling and clearing
UP complicated and interviewer f.
rla nCia1 conditions as the late Fred
erick T. Olcott was. II was not
ronp1eted until Mr. COster. of the
firm of J. T. Morgan and Company.
did the work. concentrating such in
long continued that his health and
in a little while his life was the
price he paid for his triumph.
II the receiver does unravcl this
tangled web Of leases. contracts and
control then it is the surmise in
some weIl-informed offices Of the city
rthat there will be undertaken a con-
soIidation Of all the passenger trans
portation systems in greater New
York Including Brooklyn Rapid Transit
system which Is now in receivers
hands. That would be a colossal pas
senger traffic combination. 1t would
represent passenger traffic within the
boundaries of Greater New York
under control OF one corporation
which In a single year would amount
to many hundred millions 1t would
probablv represent the creation Of
new obligations. new stock similar in
principle il not in detail to trans
actions OF that kind which were per-
Tected when the elevated railroad
systems were completed.
Reason for Suspicion.
The suspicion Of high finance which
would resemble in some of its features
the high finance of an carrier day is
based upon the surmse that the ap-
pointnent Of A receiver will newt
ably cause the market value Of tho
stock to be greatly deprecia ted. Thief
when conditions are satisfactory the
board Of estimate and the public
service commission may permit an in
crease in single fares from cents
TO 8 cents. Should that be done and
the receiyership he satisfactorily
terminated then there would be
rapid and probably very large an
.prpciatiOn in the market value OF the
stock. The statement was made ttts
morning that It is not impossible that
high finance may be so directed tn
ultimately when REORGANIZATION 5
coupleted those who have taken !
vantage of the opportunity will find
their wealth increased from Ss,OOO. COO
to slO.00n,oOo.
OF course. suggestions Of this kind
are mere surmises, but they do seem
to have impressed some of those who
have been closely watching the sjtua-
ton and who have been certain that.
as was tire case with the BROOKLYN
Rapid Transit Company a few weeks
ago, so by spTinEtime the New York
CITY Railways Company would be com
peIled to submit. perhaps willingly
submit. to the appointment Of a re-
ceiver. HOLLANDS
PHILADELPHIA PRODUCE