Omaha daily bee., 1922-06-13
.S.P.andC.P,
.OneSys,'<.::''
Chies&""
Two Roads Sepa Name
Only, Presideu. Sproule
Says, in Comment on
Court Decision.
Consolidated in 1872


San Francisco. June l2-(By A..
P.)-That the Southern Pacific and
the Central Pacific railroads have
been under common control for half
a century and that their growth has
been the development OF single
railroad system. separate in name
only, filling a demand which single
company could not have filled, is the
assertion in a statement by William
Sproule, president OF the Southern
Pacific. The statement was issued
in commenting on the recent United
States supreme court order directing
absolute separation of the two roads.
THE Central Pacific has been
leased to the Southern Pacific for 81
years." he said. He continued:
THE Southern Pacific has been the
actual owner OF the entire capital
stock OF the reorganized Central Pa
cific for % years. The decision OF
The supreme court is that these facts
are in violation of the Sherman act,
although the Sherman act was not
passed until 1890.
Under Common Control.
Besides this thre is sufficient evil
dence that the Central Pacific and
Southern Pacific were held in conf
mon ownership as early as October,
1870. The official records prove
that the two have been under conf
mon control and management for
50 years, or since July, 1872.
The growth has been OF cne sys-
tenn and not of two. The two conf
panies did what one company could
not do under the circumstances of
the time. Each has been necessary
to the other for effective service.
THE supreme court now decides,
in effect, that the lease of the Cen
trail Pacific to the Southern Pacific
became void when the Sherman act
was passed, because of the Sunset
Route through Texas on the south
competing with the line through Og-
den on the north. The fact is that
the line Gown the San Joaquin val
ley and over the Tehachapi noun
tains to Los Angeles, was built to
meet the public demand for railroad
through the San Joaquin valley and
on to southern California. The same
public demand was behind the
further extension. of the line from
Los Angeles eastward through 81
Paso and to Sierra Blanca. Tex.
Backed by Public Desire.
"The Central Pacific carried the
extension into the San Joaquin val-
ley as far as Goshen, the Southern
Pacific taking II up there and carry
ing it on southwark and eastward.
Everything that was done had behind
it the backing Of public desire with
the approval of congress for the de-
velopment Of the resources of Cali
fornia, Oregon and other Pacific
states resources then dormant, but
with their possibilities evident"
After expressing his belief that the
only question Of present interest to
the public is whether the public is
hurt by having this development
done by single control under two
corporate names, instead of BY a
single control with a single name.
President Sproule points out that the
transportation act of 1920 provides
that with the consent of the inter-
state commerce commission, it shall
be lawful for two or more carriers
to consolidate their properties or any
part thereof under conditions in har-
mony with the general plan Of con-
solidation of the railroads Of the
country in groups
Conditions Changed.
"The interstate commerce COM
mission thus can take up the chain
OF events" the statement continued.
The fact is that government con-
Ltrol of the railroads has 50 increased
and the policy of the government SO
changed since the suit was begun
in 1914, that the situation needs to
be dealt with in the light of present
conditions and not the conditions
that prevailed from 1885 to 1899.
Every essential factor in the railroad
business is supervised by the COM
missions created to protect the gen.
eral public interest.
"The interstate commerce commits
sion following the mandate of the
transportation act of 1920, already
has prepared a tentative plan for con-
solidating the railroads into a limited
number of systems. In this tentative
plan the Central Pacific and the
Southern Pacific remain together.
"As business question, the COM
mission evidently saw the wisdom
of not disturbing the present con-
troll and found no reason to believe
that there was any undue restriction
of competition in the situation now
existing, or if there was any tituiar
restriction that it was more than bal
anced by the other conveniences af-
forded the public"
Nomination to War Finance
Corporation Confirmed