New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1921-05-07
.T4al,t,r's Charges
Visionary. Say
Roads Counsel
Accusations of Past FL
naneiai Misnanagement
Water Over the Dam, -
Reply TO Unions Exhibits
n. Y. Central Case Cited
Workers Evidence Branded
as Revolutionary i'm Char
acter"; Contrary to Courts

CHICAGO, May 6.--Labor's charges
Of financial mismanagement by railroad
homogeneous were declared irrelevant,
visionary and fallacious to-day when
representatives Of Eastern roads began
their closing argument before the
Railroad Labor Board in the wage re-
duction hearing. Nearly 100 roads are
represented
The exhibits compiled by ". Jett
Lauck, in behalf of the railway unions,
came under fire from E. H. Sennef,
counsel for the Pennsylvania; John G.
Walber, speaking for all Eastern
roads; c. l.. Bardo, in behalf of the
New England roads, and Jacob Aron-
son, counsel for the New York Central.
The railroads took up their rebuttaI
after the heads of the Big Four broth
erhoods had closed their argument.
Charges of past financial mismau-
agement was water over the DAM Mr.
Sennef said, adding that the Inter
state Commerce Commission now con-
trolled all financial transactions. Mr.
Walher said that "from reading Mr.
Lauck's exhibits one might get the i'm
preston that American railroads are
antiquated and inefficiently managed"
He denied such Prescriptions, he said
and pointed with pride" to American
transportation, acknowledged superior
to any railroad service in the world"
Answering specifically an exhibit
filed by the employees on alleged mis-
management of the New York Central
Railroad, Mr.. Aronson branded it as
revolutionary in character" and con-
trary to the findings of various state
and Federal o@ar4s. Although, he said,
the exhibit was cxtraneous, consisting
should not be allowed to divert atten-
zion from the main facts of the case,
he made a brief reply to several of
labor's accusations.
Regarding the consolidation of the
New York Central and the Hudson
River Railroad in 1868, he said the Su-
preme Court justified the scrip stock
issue, which the unions charged was
used to initiate the capital stock. Capital
stock issues from 1870 to 1910, ne said.
showed that S16S,90T ,374 in cash was
paid in for funded debt of $16S, 1885,
$40, performance which Mr.. Aronson
declared was particularly praise
worthy"
The consolidation Of 1914, in which
the Lake Shore & Michigan was
brought under New York Central con-
troll, showed extreme conservatism, /"
he continued, He declared large blocks
of stock in subsidiary companies were
wiped out and not capitalized in this
merger. The 1914 consolidation. he
said, had received approval Of numer-
ons courts, from the Public Service
Commissions of New York, Ohio, Mich
igan and Illinois and IN the United
States Supreme Court.
THE bold conclusions on the fnan-
cial performance of railroads." Mr.,
Aropson concluded, appear to be
predicated to large extent upon the
novel assumption that undistributed
surplus does not constitute capital.
The fact that this theory is at variance
with the genesis OF state and Federal
laws, as reflected in tax statutes. the
theories of the Interstate Commerce
Commission and the courts generally,
indicates its revolutionary character"