Grand Forks herald. [volume] (Grand Forks, N.D.) 1916-1955, 1921-12-29
EVENING EDITION..
Ralph Bsda Make. Reply
IL Editorial Appe.ring Il,
Grand Jerks Herald Fer
Decenber I.

OF f10l Mlnnp . -, 1891.
Editor Grand Forks Herald,
Grand Forks. North Dakota
Dear Sir:
Rsssestisn n m.de in edftoria.
which appeared IN yo1r iMue for De-
scmher 8, 1891. which Il wound be
P roper for someone to explain how
the Burlington railroad could. declare
2 dividend Qf ~ per cent on Decem-
ssr !, 1891, (which to q large extent
bsnehtted the stockholdsrs Of the
Great Northern and the Northern Pa
cane railway companies) unlew 1t had
oeen making excessive earninu.
The explanation of this 10 that for
the past twenty years the Burlington
fAa1road has been capitalized for only
D two-thirds Of its value and that,
therefore. for twenty years 1t has only
paid to its shareholders about two
thirds an much az II its dividend rate
MAO been. calculated on tn full valua-
zion. In other words, during this.
twenty Year, the stockholders (prtn-.
eiPaily the Great Northern and the!
Northern Pacific railroad companies)
tsft in the Burlington property earn.
angs they might properly have taken.
ThA, OK course, accumulated = very
large surplus, and new, when the
country generally is In hard ctrcum-
S u. 40 VA4y 446AAS 0&1A pkVP04
that he Burlington stockholders
should use this rcsorve to tide them
over until a return Of better times
In which they have faith ultimately.
From 1902 to 1891. inclusive. tho
Burlington railroad has earned an av-
eraSe of SIS per cent on its value.
During that time, and including tho
Slpsr cent dividend paid in Decem-
her. 1891, IT has paid to its stock
heldeFs an average per annum Of All
Per cont on ita value. The difference,
LIS pei cent, on its value. has been
Dut back each year into the property.
I believe that you will agree this has
been . very conservative policy and
the kind that should be encouraged.
4, Your editorial Of December 10,
quoted a letter which indicated q dis;
satisfaction with the policy Of hand
ling the Great. Northern. the North
ern Paciht and the Burlington. hut
seemed to give the impression that
the Great Northern and the Northern
Pacific had contributed more to the
darlington, by way of giving 1t a;
6reat deal Of. business and prosperity,
doubt the Darlington has benefited
By. having the Great Northern and the
Northern Pacnc as its connections.
To a large extent this accounts for
khe Buriington'n prosperity since It has
bean under the control Of tho Great!
Northern and the Northern Pacific,
Init the benefit was largely mutual. ~
Ehs Great Northern and h Northern
> Pacific, instead Of suffering them
pelves By reason Of contributing to tho
BurlinGton's prosperity, Also benefited
~ reason Of having the Burihston's
business e8t-bound. OF course the
two r~oadsLwere able to deliver more
to- tho BarlinEton than the Burning
ton was able to deliver to eAch Of
them. The whole arrangement seems
tohhave worked out> in 4 very beneh-
cial way without detEimeut to any
one; the real ID for the pro1per-
ty. being that It established long
through routes, making possible tho
conduct Of transportation At low
prices.
Il might not be amass In this eon-
nectfon to quote from tho opinion Of
Commerce Commission, on The occA-
mon Of the hearing early in 1891.
@ en- t tSs e Re4ths sasn f,sne s aGs ths
Burlington were fully disclosed and
discussed. He said: ~
re At a time when the
Burlington was IN need Of Pacific
coast tee1nini which 1t Was planning
to obtain by extension Of fts lines.
and when. the Great Northern and tho
Northern we're in need Of terminal ia
ctlites ut Chicago and other cities.
which they were planning to obtain, II
was decided that combination Of in
terests would supply these needs
more economically and edfcisntty
. than would be possible by tndspsnd-
snt action, each carrier for ttaelf.
After efforts made tn VARIOUS dirDO-
tions, the northern carriers In 1901
obtained control Of tho Burlington.
Sinca then tho mileage owned and
operated By the Burlington has been
increased over 1884 miles n the
freight tons handled have increased
from about seventeen millions In
1901. to f%ovty-nine millions in 1919.
THE evidence presented to Us haa
been such as to convince me that the
practical results ~ the reaattonahi1