The Bridgeport evening farmer. [volume], July 09, 1913, Page 10, Image 10

About The Bridgeport evening farmer. [volume] (Bridgeport, Conn.) 1866-1917

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10
THE FARMER: JULY 9, 1913
COMMISSIONERS SAY WASTE
IS RESPONSIBLE FOR DROP
IN NEW HAVEN'S DIVIDENDS
CContinued from Paw 1)
Action. The 'Inevitable" query is: "What
w.i the motive behind this transac
tion and -who made the profit? That
Question, in the very nature of such
transactions, never can be satisfactor
ily answered."
The New York. Westchester & Bos
ton Railway, the evidence disclosed, a
four-track electric road extending
from White Plains. N. X., to a ter
minus at Harlem River, a distance of
2i miles, was built and is owned by
-he New Haven. When It was open
ed for business in 1912 it had cost the
New Haven about J34.000.000, $12,
000,000 in excess of the value of the
property on the New Haven's own
showing.
"Again the question arises" suggests
Commissioner Prouty, " 'What has be
come of this $12,000,000?" So far as
the records go this money has vanish
ed into thin air."
The property is expected in time to
earn its fixed charges and perhaps be
profitable. The report points out. that
"ail this in no respect alters the qual
ity of -the transactions. In any as
pect of the matter, the" patrons of
those lines are required to pay upon
an investment which never has been
made, annd thereby subjected to a
perpetual unjust exaction."
The acquisition by the New Haven
of trolley lines in Massachusetts is
reviewed at length.. Particular ref
erence is made, to the operations of
J. L, Billard in connection with the
purchase by the New Haven of Bos
ton & Maine stock. The conclusion
of the- report is that the New Haven
Co., gave away to Billard and his as
sociates about $3,000,000 of the prop
erty of the New Haven.
"These transactions," says the re
port, "are probably extreme, but by
no means solitary. The other outside
ventures of the New Haven Co., have
been almost uniformly prosecuted -at
a loss. This is true of its trolley ac
quisitions In Connecticut and Massa
chusetts, as well as Rhode Island and
New Tork; It Is true of its -purchase
' of railroad stocks and steamship lines.
Mr. Mellen entered into an elaborate
defense of his management of this
property, and he- was able to point
to but a. single instance in which, up
to the present time, the venture had
been profitable. He had purchased
the Central Railroad of New Eng.
land, and the profit upon that trans
action had been a handsome one."
The transactions -f President Mel
len In giving his personal notes to his
own company for stock are discussed
at length by Commissioner Prouty.
On transactions in New Haven
stock, bought with such notes, the re
port says, there were profits of $102.
00 but the New Haven'e books do
not show to what use the money had
been put.
His statement was that the amount
had been used In campaign expendi
tures during the summer and fall of
1904. that this had been done by di
rection of his directors, and that they
had subsequently ratified his act.
These campaign contributions call for
no comment frqm us. The act of the
New Haven was not peculiar to that
' company at that time. What may be
open to criticism Is the lax way in
which this matter, was handled be
tween an officer of this company and
Its directors. The special account
shows, a payment to Mr. Mellen of-
$50,000 in cash, which he passed over
to the Republican National Campaign
Committee. It shows a second pay
ment to Mr. Buckiand. now vice-pres-Idet
of the company, of $6,500
which was turned over to the Repub
lican State Committee of Rhode Isl
and." The Investigation disclosed that such
stock transactions extended over a
considerable period and from time to
time Mellen was given various large
sums for various purposes unstated on
the books of the company. He ex
plained that the amounts he received
were for campaign contributions and
for other expenses. Including one item
-of $83,000 spent in connection with
"certain leases of dock property in
New York City." Commissioner
Prouty says the Commission doubts
the uroorlety of this laxity in ' the
keeping of accounts between Mr. Mel
len and his company. "If," says the
report, "the president of this corpo
ration expends money 4n connection
with the purchase of a lease he should
take a voucher for the same.s If the
expenditure Is not such that a vouch
er can be taken. It ought not to be
made." It is pointed out that all of
Mr. Mellen's notes to the New Haven
have been liquidated, except one for
$5,000, but many of them involve
transactions which are .not disclosed
by the books.
- The marine equipment of the New
Haven was manipulated, according to
the report, in a way to defy analysis.
"The New Haven earnestly insists
says Commissioner Prouty, "that all
these involutions and evolutions, all
these kaleidoscopic transformations.
injure nobody. This may be true, but
the purpose of book-keeping is to ex
hibit a plain history of the financial
operations covered. The purpose, or
at least the effect, of this New Haven
book-keeping, is to utterly becloud
those operations so as to render any
intelligent understanding of them Im
possible. If the thing done is legiti
mate, why not do It in a direct way?
If the purpose be honest, why clothe
It In -the habiliments of the mounte
bank? The use of such methods in
the management of public utilities
should not be tolerated.
"Our general conclusion is that the
outside financial operations of the
New Haven Company for the last nine
years have been wasteful in the ex
treme and that the methods by which
those operations have been conduct
ed are unnecessarily . involved and
complex. The reason for this is as
apparent as the fact itself. The
present management of that company
started out with the purpose of con
trolling the transportation facilities of
New England. In - the acomnllRh
men! of this purpose it -bought what
must be had and paid what must be
paid. To this purpose- and its at
tempted execution can be traced every
one of these financial misfortunes and
derelictions."
"It seems proper to add that while
" the financial operations of this com
pany have resulted in heavy losses,
there Is nothing to Indicate that its
solvency has been . impaired. The
company has expended in the last
Bine years upon 4ts road and equip-
jnant over $50,000 a mile, a sum al
MISS KATHERItlE FORCE, SISTER OF
MRS; JOHN JACOB ASTOR, ENGAGED
most equal to the average capitaliza
tion of the! railroads of the United
States at the beginning of that period.
While this expenditure has been 'made
with a free hand, there is nothing to
show that it has not been wisely
"made and much to indicate that the
result has fully justified the outlay.
The outside properties of the New
Haven have been acquired at extrav
agant prices. They are for the most
part of substantial value, and In many
instances are a kind of property the
value of which should improve. The
financial condition of the company
calls for careful consideration and
prudent action, but gives no occasion
for hysteria. .
Incidental to the acquisition of the
control of the Boston and Maine by
the New Haven, the report discusses
the financial condition of the former.
Of the showing for the fiscal year
which ended June 30 Commissioner
Prouty says:
"The" time seemed imminent when
the, Boston. &. Maine, which had, for
seventy-two years declared regular
dividends, , would not. earn its fixed
charges. To declare this company
insolvent and place it in the hands of
a receiver would notnly inflict hard
ship upon its stockholders, but would
be a source of serious inconvenience
to the territory in which it operates.
and would shake the . confidence of
railroad Investment as a whole. No
such extremity should be permitted
unless some fundamental reason re
quires it."
Criticism is contained in the report
of . the methods of leasing other lines
practiced by the Boston & Maine, the
amounts being flat sums each year
without reference to the ability, of the
lines leased to make the necessary re
turns. Such a method ..of building up
a railroad system is denounced by the
Commission as "inherently vicious."
"It would "be a monstrous proposi
tion," declares the report, "that be
cause at some past day some board of
directors of the Boston & Maine Rail
road had agreed to pay an extravagant
price for the use of the lines making
up its system,, therefore the ownners
of 'these properties are for 'all time
entitled to obtai this undue re
turn Upon their investment." No
criticism is made of the New
Haven f or ' its management of
the Boston & Maine, although its ex
penditures In operations "have been
made with a free hand."
In discussing the remedy , to be ap
plied to the general railroad situation.
Commissioner Prouty says:
: "What is needed first of all to im
prove the railroad situation in New
England, is rest and an opportunity
fori constructive work.' There is
much" truth in the claim of these .car
riers that they have been so occupied
with investigations and so criticized
by the public that no fair opportunity
has been given 'for the operation of
their railroad properties. , Ko rail
road management can succeed with
out' the support of the- public which It
serves. "-It must not be forgotten that
tie railroad Is a public servant in fact
as well as in name, and that the ser
vice which it renders depends largely
upon the. treatment which it receives
from its master. ...
"But upon what terms is peace to be
secured? In the past the New Haven
Co., which has now become the dom
inant factor and which is mainly to
be considered, has proceeded in open
violation of some laws and in disre
gard of the spirit, if not the letter, of
others. This course upon the part of
that company is primarily responsible
for this unfortunate agitation. - That
agitation can not' stop, and ought not
to stop, until its cause is r.emoved.
Any betterment of railroad conditions
in New" England must begin with the
assurance that the New Haven man
agement will act not only prudently
but, above all, within the letter and
the spirit of the law. -
The Commission, the report points
out, is keenly alive to the fact that
the stocks of both the New Haven
and the Boston & Maine are owned
largely in New England by estates and
persons who depend upon them as in
vestments. "It is unfortunate," continues tht
report, "that the widows and orphans
must suffer, but they, in theory, are
responsible for the management which
their action, or possibly their failure
to act, has sanctioned. If the stock
holders of these properties", instead of
villifying the critics of the New Haven,
had given some attention to the
charges made, their property would
to-day be of greater value and the
problem an easier one;"
The Panama Canal Act, of 1911, re.
quires the railroads to relinquish own
ership or control of . steamship- Hnes
competing with their rail lines. The
report suggests that this law disposes
of the matter of the New Haven water
lines. It continues: .
In our opinion the New Haven
should divest itself of its trolley lines
The acquisition of trolley - lines as
steam lines which are competitive is
already prohibited, but this does not
reach the root of the matter."
It is suggested that control by the
New Haven of existing trolley lines
probably would be used to prevent the
construction of other and competing
lines' in the future, although the ac
quisition of existing lines might not be
a violation of the Sherman Act.
"We feel i that -the public," says the
Commission, "may.- well protect itself
against tne control or trolley lines ana
the prevention pf; competition in that
held. Such competition is not de
structive of railroad business proper.
In that connection, the report adds:
"It ' is worthy of remark that the
general counsel of the New Haven
company testified that, while the leg
islature of Connecticut did finally vote
unanimously in favor of the New Ha
ven ownership of trolley lines, sent!
ment was at the outset the other way,
and it was only after .$100,000 had
been expended in 'molding the opln
Ion of the legislature that the final re
suit. was attained."
The so-called merger between the
New Htoen and the Boston & Maine i
discussed at length but no opinion is
given. The report .observes that Bos
ton has more at stake than all the
rest of New England, bojh as a port
and as a market and that whether
Boston would be injured by perpetua
tion of the merger would depend large
ly upon whether the corporation con
trolling the railroads of New England
was dominated by Boston or New
York. It adds:
"If the New Haven company is per-
iV- 'L-: ' 1 ''It
XVV-'V i-'- :- ----- r i
Bar Harbor, Me, July 9 The an
nouncement of the engagement of Miss
Katherine Force, daughter of Mr. and
Mrs. William Force of New jTork and
sister of Mrs. John Jacob Astor, to
Henri Harnlckell,- a New York brok
er, has created widespread interest. It
was said the wedding would not take
i'jaue' iur euine time, DUt it is un
derstood that it will be In Bar Har
bor. Miss Force arrived here with
Mrs. Astor in June and since has liv
ed very quietly at La Selya.
mitted to remain in control of the
Boston & Maine system there will ex
ist an almost exclusive monopoly of
the transportation facilities by rail-;
road in the greater part-of New England.-
It would ' seem to be perfect
ly apparent that if this monopoly is
suffered to exist there must be some
where a power of regulation which is
co-extensive with the monopoly. In
other words, the Federal Government
must assume jurisdiction over the
maintenance and operation of these
railroads in so far as may be neces
sary to secure to the public a proper
service. This investigation empha
sizes the fact that service Is often
of even greater importance than the
rate itself."
As criticisrfi of both freight and
passenger service developed, both -were
considered. To both the New Ha
ven and the Boston & Maine-the re
port gives credit for promptitude and
general excellence an tneir passenger
service, although it is distinctly noted
that "safety of ,operation has not been
considered."
Summing up the. passenger . service;
Commissioner Prouty says: '-..-. -
"Upon the whole the record-shows
that the performance of the passen
ger trains of the New Haven is good,
distinctly better than that upon any
other system operating in the state of
New York; while that upon the. Boston
& Maine is fully equal to that upon
any New York system." "While there
Is room for improvement, New Eng
land should be well satisfied Upon the
whole with the passenger performance
of these lines under investigation."
Adverse criticism is. made of the
passenger train equipment of both the
New Haven and the Boston & Maine.
It is said by statistics to be not up to
date. Both roads lac steel pars and
vestibuled cars,, both of which make
for comfort -and safety of .travelers.
It is shown that other lines, in these
respects, are far better equipped than
the New England roads.
The serious complaint of the freight
service, particularly of the Boston &
Maine, "demonstrated," the report
says, "beyond question that in many
cases there had been a most serious
short-coming in the quality of the
service rendered. It raised a pre
sumption that the service of the Bos
ton & 'Maine, as a whole, and that of
the New Haven to a more limited ex
tent, should be vigorously condemn
ed." '
. Reeords of thousands of shipment:
from various, points and at verious
seasons were examined and compared.
In many instances it was found that
apparently there had been inexcusable
delays and Commissioner Prouty re
ferred to much of this service on the
Boston & Maine as "decidedly bad"
and "indefensibly poor." The report
continues:
"The statements furnished by com
parison show that the service of the
Boston & Maine is much less reliable
than that . of either the Pennsylvania
or Baltimore & Ohio, while that of the
New Haven is slightly inferior to the
Pennsylvania, but about on a par
with the Baltimore & Ohio."
Special reference is made to the
excellent freight service on the Maine
Central, and Commissioner Prouty de
clares that "when the other two mem
bers (the Boston & Maine and the
New Haven) of this family equal it
there will be no more complaint of in
ferior freight service, and there is no
good reason why substantially this
service should not be accorded to all
New England." In summing up that
phase of the inquiry, the Commission
.says:
"Our general conclusion is that
freight service upon the New Haven
Railroad is Inferior to what it should
be, although fairly comparing with
that in other sections where .condi
tions are substantially the same; that
the freight service upon the Boston
& Maine during the period covered
was extremely poor and justified in
great measure the criticisms it re
ceived. No satisfactory condition can
be brought about at many points on
the Boston & Maine, however,, until
Improvement has been made in the
facilities at these points.' There must
be ' a betterment in the physical con
dition of the property before there
can be an altogether satisfactory
freight service."
An extended inquiry was . made by
Commissioner Prouty into the rate
situation, although increases in rates
and fares were only incidental to the
general investigation.' The report
points out that "for many years the
railroad monopoly of New England
has been more complete than in any
other considerable section of this
country. - The Boston & Maine has
almost exclusively occupied the north:
ern portfon of that section, while the
New Haven has enjoyed the same ex
clusive privileges in the south.
"Our examination," the report con
tinues, "fairly indicates that freight
rates between points in New England,
while somewhat higher In many in
stances, .compare favorably with those
in trunk line and "central freight as
sociation territory. They are lower
than corresponding interstate rates in
other parts of the country, although
not so 'low in some Instances as the
commission-made rates of , several
states in this outside territory. The
long-distance rates which New Eng
land enjoys are generally very favor
able to that locality. It should be
jioted in this connection that the cost
of handling freight is greater in New
England than in trunk line and cen
tral freight association territory, and
indeed, in most other parts of the
country. .
As to passenger fares, it Is pointed
out that "the published schedule fare
in Tew England is' somewhat higher
than ,m either - trunk-line or centra,
freight association territory," al
though many conspicuous exceptions
to this rule are noted. It is shown
that practically- all of the passenger
business "Of the New England roads is
done under the mileage system of
making rates "st that the actual fare
paid by the people of New England
for their local transportation by rail
Is two cents per mile. To-day a pas
senger can purchase a l,000rmile book
good to bearer and good until used
upon almost the entire railroad mile
age of New England. In no other
section of the country does an equal
population enjoy this privilege. The
average rate per passenger per mile
upon the New York; New Haven &
Hartford in the year 1911 was 1.708
cents: -upon the Boston & Maine,
1.801; and In the whole United
States, 1.974."
Summarizing the passenger-fare sit
uation in New England, Commission
er Prouty says : . s
"Its passenger fares have been jnore
favorable to the local traveling public
than in any other portion of the
United States. The recent decision of
the United States Supreme Court sus
taining tne statutory two-cent per
mile tares in several states will tend
to make that fare more general In the
future.
The doors and windows of the Con
gregational church we're intact when
the bell pealed forth the glad tid
ings of the breaking of the shackles
of more than a century before, while
the Epiecopal bell bellowed its glad re
sponse. The sieuins ana. tne cnurcn
officials were ; amazed, but the boys
had put one over on them. Early in j
the evening a relay of faul Kevere,
had posted themselves in the belfries
and at the appointed time the bells
clarJged the old alarm from street to
street while the- disgusted officials
wended their ways homeward convinc
ed that "boys will be boye"" and the
American sentiment will persist in
spite of peace societies pleas and pla
titudinous preachers.
Miss Eleanor Cavanaugh, of New
York city, is spending a month va
cation with her mother, Mrs. Lucy
Cavanaugh at their home on Mt. Pleas
ant road.
WALNUT TREE HILL NEWS.
Miss Ina Driscoll has! been spending
her vacation with Miss M. Merwin of
Waterbury, who will return Wednes
day with Miss Driscoll to enjoy New
town air, and the pleasant .associa
tions of the Hill.
William Egan and a party of
friends from. New York City spent
Tuesday afternoon with his sister.Mrs.
William Driscoll. The auto party re,
turned to New York by way of New
Haven the same evening.
Mrs. Kate "Ward is a guest of her
father, Maurice Leavy. .
Mr. and Mrs. Frank Murray and
children of Bridgeport enjoyed an
auto trip to Newtpwn Sunday, calling
on friends on Queen street. They ex
pect to return to the country shortly,
to enjoy their summer vacation in
the healthful camping-out style, in
securely arranged tents near Botsford
Hill. -
EDGE WOOD NOTES.
Mr. and Mrs. James Brown of Jer
sey City, N. J., spent several days with
Mr. and Mrs. P. H. McCarthy. Their
nephews, James and Charles Brown
are. to remain for a longer vacation.
Mrs. P. H. McCarthy went to Hol-
yoke Friday, to bid adieu and wish
bon voyage to her mother, Mrs. Lynn
JACK LONDON IN
NO FEAR OF DEATH
WHILE IN HOSPITAL
I
r ;
: t
i
IpiiRiilPii
A - ' s
'4 Tf
San Francisco, July 9 After Jack
London, the novelist, was operated on
at a hospital in Oakland for appendi
citis his condition was watched with
anxiety, although the doctors had said
and three sisters who sailed for Scot- ""t he wou'd likely pull throughin
land on Monday.. Mrs. -Lynn and side of ten days. The writer has un-
daughter started from Boston foi
Glasgow and expect to be gone six
weeks on tneir pleasure trip.
Mrs. C. H. Bassett, Mrs". W. B. Snif-
fen and Mrs. Ammon Taylor were vis
itors to the Park City, Tuesday
dergone many hardships and has come
through innumerable perils during his
interesting career at sea and in the
Alaska gold fields. Before he went on
the operating table he laughed and said
he had no fear of the surgeon's knife.
MYSTERY ABOUT
DEATH OF GIRL
FOUND DROWNED
Wilkes-Barre, July 9. The police
and" county authorities who are trying
to solve the mystery surrounding the
death ofMlss Alice Crispell, 19 years
old, whose body was found floating
in Harvey's Lake on Monday, are to
day without a tangible clue, trfough
theories are not lachSng. Herman
Johns, mine worker who was the last
person seen with the girl and who Is I
in Jail on suspicion in connection with ',
the case, maintains his calm demeanor j
and adheres to the details of the story!
he has told the last night he was witbj
the girl, which- was Friday.
One of the theories the authorities
are working on is that Johns ms? j
have had a rival for the hand of Mica j
Crispell. In the letter Johns wrote to i
the girl oh Sunday, after she had been
missing two days, and which was
made public yesterday he mentioned
a man named "Canney." This turned
out to be Harrison Cahn, of Wilkes
Barre who when questioned by the
police said he knew nothing about the
circumstances of the death of the girl
and further expressed the belief that
Johns also was innocent. The police
are investigating the story that the
jrlrl had promised her favor to the
one who should first swim across the
widest part of the lake, a distance of
about two and a half miles.
-, Search is being made for a third
man who was said to have been in
terested in Miss Crispell, to learn if
this can throw any light on the death
of- the girl. t
Friends of the Crispell family are
divided as to whether the girl wasJ
murdered or fell accidentally into the
lake. .-'"'.
TOWN DESTROYED BY FIRE.
New Orleans, July 9 Independence
La., a town of 1,000 inhabitant. wb
practically destroyed by fire yesterday
entailing a loss estimated as exceed
ing $200,000. Only three buildings, a
saw box factory and two dwellings
were left.. -
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NEWTOWN
As previously announced th eAlumni
Association of N. H. -S., met Monday
evening and voted to give a whist
party at Town hall, Tuesday evening.
July 15th. This is the first venture
of the united classes' and is for their
benefit and through them for the High
school. As is well known every year
separately they have been able to fill
Town hall to an extent witnessed at
no other time than the graduation ex
ercises. The following committee are
in charge. Misses May Egan and Elea
nor Cavanaugh 1907; Mr. Arthur Fair
child, 1911; Miss. Helen Keane, Messrs.
Phillips, Morris and George Ferris,
1912. 1 . ,
At the Town clerk's office: Warran
tee . deed from Richard Sheppard to
Frank Wilson botb. of trris town for
land in Dodgingt6wn district. .
Dr. ' Peck of Mt. Pleasant has re
ceived from Contractor Brew estimates
and plans for a boat house .on Foun
tain lake and a garage in the rear
of his house contiglous, which he ex
pects to have built in the near future-.
Those two well known sleuths. Sher
iff A. B. Blakemaa and Constable T.
Carlson, had a very busy twenty-four
hours at the advent and during pro
gress of the national holiday. From
midnight of July '3rd, they were on
duty against the operations of the
bubbling boys who sought to carry
out the prophetic vision of the old
fogy. John Adams, who said future
generations would celebrate the pas
eage o the Declaration of Independ
ence, by the ringing of bells, bonfires
and illuminations. Hence fbese repre
sentatives .of modern law and order
stood round the Congregational church
all that early morning and halted all
gatherings, but unsuccessfully, as all
i residents of th borough well know
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