S'The BilliNgs, Gazette.
VOL.XXII BILLINGS, MONTANA, TUESDAY, FEBRUARY, 26. 1907. NO.88
STORY TOLD OF
MANY MERGERS
E. H. Harriman Relates Portion of
Huge Financial Deals.
FAILS TO ANSWER QUESTION
Denies All Charges--Paves Way to Higher
Court--Limit to Power.
New York, Feb. 25.-E. H. Harri
man, head of the Union Pacific sys
tem, spent today in a recital of por
tions of the intimate history of the
financial operations of himself and
associates, before the interstate com
merce commission, which, in behalf'
of the United States government, 'is
investigating consolidations and com
binations of carriers, relations be
tween carriers and community of in
terest therein, their rates, facilities
and practices. Special counsel for
the government made particular at
tack on the reorganization and finan
cing of the Chicago & Alton railroad
by the Harriman syndicate and their
action, which, with a challenge by
counsel for the railroads of the right
of the interstate commerce commis
sion to inquire into, the private trans
actions of an individual, constituted
the two chief events of the day's pro
ceeding.,
.Mr.,~ Hrrimau declined to:·teitwhat,{
ptoportion of the preferred stock of'
the Alton sold to the Union Pacific
belonged to him individually, and the
way was paved for taking the ques
tion into the federal courts. The
point raised involves a material lim
itation on the inquisitorial power of
the combination and is of serious im
portance to the whole question of in
terstate incorporation investigation.
There was an effort to show that
there had been an enormous inflation
of the stock securities and liabilities
of the Alton; that the Harriman syn
dicate had taken unfair profits by de
claring a dividend of 30 per cent from
the proceeds of the first sale of the
bonds, amounting to $40,000,000; that
the syndicate had sold itself the
bonds at an unreasonable low figure,
only to resell them at enormous pro
fit; that the Harriman syndicate had
in the Alton capitalized the losses
of former stockholders in the road
and the money which had been spent
by the old management for better
ments over a period of 10 years and
already charged to operating ex
penses; that the books of the com
pany had been doctored, and that for
an increase of the stock and liabili
ties from about forty millionms to
one hundred and sixteen millions
there was nothing to show, except an
expenditure of twenty-two million in'
improvements on the property.
Mr. Harriman's testimony was a
denial of al the charges, and he made
an extended explanation and defense
of the transactions, which he con
tended were fully justified by the con
ditions and circumstances of the time
and had been conducted entirely in
the open.
Harriman's examination lasted for
five hours, and was unmarked by
acrimony. The witness declined to
he led into an attempt to explain the
details of the Alton operations, and
constantly referred his questioner to
the records of the Alton company..
Mr. Harriman's testimony began
with the issuance of one hundred
million of controvertible bonds by the
Union Pacific company for the pur
pose, primarily, of paying for the
Southern Pacific in 1901, and then
led through the purchases in con
nection with the Oregon Short Line
of the Northern Pacific stock.
He identified a statement showing
that since the first day of last July,
the Union Pacific and Oregon Short
Line have purchased stocks at a cost
of one hundred and thirty one mil.
lion dollars, and Mr. Kellogg, the
government's attorney sought to
show that, figured by prices in the
market today, there had been a loss
of $11,000,000 on the investment Mr.
FTarriman said that was possibly
true, and when further questioned
asked permission to explain.
The witness said if the Northern
Pacific and Great Northern maintain
their present prices the, profit on the
Northern Pacific inveatment would
amount to about $61,000,000. The wit
ness was taken over the total in
vestments and sales made by the
Union Pacific and Oregon Short Line,
and in the end denied that they had
been made for speculative purposes.
The witness then related the story
of the purchases of the forty-five mil
lion of the stock of the Baltimore &
Ohio, paying for which would, he said
be completed in March and Septem
ber next. He had discussed the pur
chase of the late President Cassatt
of the Pennsylvania railroad, but
nothing had been said as to price, and
no conditions were attached to the
purchases.
Inquiry about the Union Pacific pur
chases of stock in the Alton led the
way to the first objection of counsel
for Mr. Harriman to a question as
to the, amount of stock witness, has
The witness explained the sale of
stock and testified that he had served
on the committee which had fixed the
price at 84%. He then was asked if
he had owned any of the stock when
it was deposited. Mr. Milburn ob
jected, saying his clients were ready
to lend every possible assistance to
the inquiry and that they rejoiced
that it gave them opportunity to clear
away many scandalous and unjust
reports. He denied, however, that the
question had any bearing on the ques
tion of interstate commerce. He said
the commission had great powers,
but there was a limit, and he thought
it was to the interest of the commis
sion properly to define its powers.
Chairman Knapp said the sugges
tion of Mr. Milburn seemed to draw
a distinction between the transaction
of the company and the action of its
officials and asked if this could be
called the transaction of an individ
ual.
There was an extended discussion
of the question and it was stated
that the commission would confer and
announce its decision later. At the
afternoon session the question was
renewed in another form and the
commission decided that it had a
right to make the inquiry. Objection
was noted in the record and the wit
ness formally declined to make an
swer.
The examination of the entire Al
ton transaction then began and con
sumed most of the afternoon. Mr.
Harriman first told of the formation
of the syndicate, which he said, con
tained many persons and which was
represented by himself, James Still
man. George Gould and Mortimer
Schiff. Ninety-seven per cent of the
stock of the Alton was acquired. $200
having been paid for the preferred
and $175 for the common, the total
investment amounted to $42,000,000.
Bonds to the amount of $40,000,000
were issued and the shareholders
subscribed for them at 65 and from
the proceeds from the sale of bonds
a dividend of 30 per cent was de
clared. The witness denied partic
ipation in a sale of bonds at 96 to
the New York Life Insurance com
pany. Mr. Kellogg asserted that the
bonds had been regularly quoted at
from 84 to 96, but the witness said he
could not remember what they were
selling at. The witness denied knowl
edge of the whereabouts of the rec
ord of the syndicate which handled
them. Mr. Milburn, representing Mr.
Harriman, objected to what he called
an effort to create the impression
that Mr. Harriman and the other
trustees owned all the stock purchas
ed by the syndicate.
t "Why ,not jump to what. you want
help you to do it."
1 (Contined on Eigahth Page.)
NO SHOW FOR IMMIGRATION BUREAI
House in Committee of Whole treases Appropriation Ther
Strikes out Enacting Clause,-Governor Approves Bills.
Helena, Mont., Feb. 25.-The bill
creating a state immigration bureau,
house bill No. 248, introduced by Mc
Manus, that was born in the All
Montana convention held at Helena
a few weeks ago and which appro
priated $5,000 for advertising the
state this year and gave a similar
amount for next year, met its death
in the house today. After increasing
the appropriations for the two years,
the committee of the whole struck
out the enacting clause.
It is so late In the session that
another measure having the same ob
ject can hardly receive favorable con
sideration.
MacAuley's police commission bill,
which lodged the appointment of the
police commissioners in the governor
and two other state officers, was also
beaten, while IScallon's bill having the
same object, but giving the mayor
the appointment of the commission
ers, was recommended for passage.
Both houses passed a lot of bills
on third reading and disposed of con
siderable routine, the house getting
especially busy in committee of the
whole and wading into a lot of bills
on general orders.
The senate committee on counties
and towns and municipal corporations
recommended for passage senate bill
No. 116, by Donlan, providing for the
creation of a state commission on
water, electricity, gas, telephone and
telegraph.
The same committee killed house
bill No. 81, regulating the rates for
water and gas, and tried to kill house
bill No. 39, providing for the inspec
tion of gas and electricity, but it was
temporarily saved 'and went to the
ct!titen ' of Sweet Grsis "coun9ty e
titioi ed to have lands withdraw$n
under the Carey act near Big Timber,
restored to public entry. A number
of bills were considered in commit
tee of 'the whole and recommender:
for passage or concurrence. On
third reading the senate passed Don
lan's pure-drug and food bill and
concurred in house bills as follows:
Providing rope fire escapes in ho
tels and lodging houses in small
towns; making effective the initiative
and referendum amendment to the
constitution, preventing superintend
ents or foremen from soliciting mon
WILL SOON KNOW HIS FATE
State Has Rested in Adams Murder Case
-.-Defense Now on.
Wallace, Idaho, Feb. 25.-The state
closed its case against Steve Adams
this morning, saving for the last hours
the weighty testimony of Bulkley
Wellis, formerly adjntant general of
Colorado, who told of the confession
Adams made to him while the prisoner
was en route from Boise to Colorado
in the custody of Detective Thiele
I and Deputy Sheriff Johnson.
"Adamns lh.d been talking to me
i:l out. the Independence explosion in
the Cripple Creek distiict," said Gen
eral Wells. "I asked him where he
had gone alter the explos.ion, and he
said he had gone up in Idaho. He
wenta1 up into the northern part of
Idaho in the St. Joe river district and
helped Simpkins "bump off" wo men
who had given Simpkins trouble in
connection with their timber claims.
Wells testlified that he was a mem
ber of the Mline Owners' association.
He said he had known Adams since
May 27, 1.900. He denied that any
threat wa'e made or inducement of
fered to Adams to secure the confes
sion, and stated that he was the only
man who heard it.
W. B. Chandler of Marble Creec was
the fiCst witness on the stand this
morning. He testified that while in
the Marble Creek district he attended
a meeting of settlers, at which the
trouble with the claim jumpers was
discussed, and say Jack Simpkins at
that meeting. Simpkins, who is sup
posed to have been Adams' partner
in killing the claim jumpers and who
t is now a fugitive, was described by
1 Chandler. He was about six feet
tall, slightly stooped, weight 190
- pounds, thin black .har and a queer
eye, which seemed to look in the, op
(Special .to' "I Gazette.)
ey among workmeit. preventing "din
kie" cabooses on..railroads, authoriz
ing the state.to ise half million in
bonds for the rede ion of state edu
cational bonds tlh proposition will
be submitted to the eople at the next
general election.. M rshall's bill re
lating to witnesses allowing saw
mills to take lands for banking
grounds, creating. county board of
educational exam ers, deficiency
claim attorney genrail's office.
Bills introduced, '
Edwards, relating; to the appoint
ment of state vete~flarian and sal
ary; HaViland,:grasting of franchises
in cities and town i Donlan, relating
to salary of marsl1: of the supreme
court; this will pl ae that officer on
a straight salary ania do away with
his fees.
Martien objected t:o Haviland intro
ducing the franchisb.lll, since it was
the same as th..ai hse bill -killed in
the senate a few 4iys ago, but the
necessary two-third vote was secur
ed and the bill in bduced.
Long made a ibtermined fight
against the bill., ineasing the state
indebtedness to h% a million to re
deem bonds declar 'invalid, but the
senate was ove iSelming against
him. By submitti the matter to
the people it will be necessary
to amend the con, itution, as many
supposed. These douse bills passed
third reading in t.h house:
Better pro"tectio Otf employes of
street railways, m od.oof procedure
in criminal actio paying bounty
claims of the Stkiien's National
bank at Fort Beii asmiending the
constitution 'relative ito terms of of
fice for policemen i l firemen, this
will make possiblthe t oolitan
bolice system, rai pal appor
ofif6o"in sa n
to mortgages, contracts by munic!
pal corporations, state entomologist,
annaul statements of insurance com
panies, extending the powers of the
state boards df stock and sheep com
missioners, certain requirements of
life insurance companies, making li
censes a lien, requiring foreign in
surace companies to have $200,000
paid up capital.
Bills introduced:
Manchester, requiring the national
flag to be floated over the capitol
when the legislature is in session and
on national holidays, Thompson of
posite direction from its mate. No I5
effort was made to bring out testimony i
as to what took place at this meeting t
of settlers.
Adams has fully regained his re- I
markable self-possession and listens
to all the evidence as calmly as if the 1
clerk were merely reading a liit of
jurors. At times he smiles or even I
laughs and exhibits no sign of worry. i
though listening to the testimony .
with keen attention. His wife is'
constantly by his side, and also shows
no alarm, though the state's evidence l
is believed to have been even strolg
or than was expected.
On the resunmption of the trial this
afternoon before the jury h1d taken
their places in the court reoo., F. E.
Richardson moved that the jury Whe
instructed to return a verdict for the
defendant for the following reasons "
First, because the testimony reia
tive to the death of Fred Tyler is not
sufficient to establish for consit,'r:a
tion of the jury that Fred Tyler a: a
matter of fact is dead, and,
Second, for the reason though it
should be sufficient it does not ustab
lish that Fred Tyler came to his death
by reason of the combination of a
felony upon his person in his lifetime,
and
Third, for the reason that the evi
dence clearly demonstrates that the
so-called confession or confessions of
Steve Adams, the defendant, in this
case were of such character and given
under such circumstances that they
were the result of fear and hope, in
stilled into his mind by the person
or persons securing the confessions
when the so-called confessions were
'made, and that they were the result,
Fergus, for substitute experimental
station near Lewistown, Shaw, re
lating to compensation of members,
officers and employes of the legis
lative assembly. This increases the
pay of members to $10 per day, presi
dent of the senate and speaker of
the house to $12, secretary of senate
and chief clerk of the house to $10,
assistant secretary of senate, assist
ant chief clerk of the house, en
grossing and enrolling clerks, ser
geant-at-arms and assistants of bota
houses $6, all others $5, pages $4;
Miller of Lewis and Clark, transfer
ring $30,000 from the fish and game
fund and appropriating the money
for purchase of grand stand and mak
ing improvements at state fair, judi
ciary committee, making uniform the
law of warehouse receipts.
Assistant chief clerk Charles Gibbs
of Sanders county was elected chief
clerk of the house, vice Nate God
frey,. resigned.
A resolution of condolence over the
death of the son of Representative
Cato of Custer was adopted.
Besides killing the McManus and
MacAuley bills in committee of the
whole, the house recommended con
currence in Everett's bill preventing
the endless chain of voting and
against fusion, after a spirited de
bate. Several other bills passed the
committee of the whole. The San
ders apportionment bill, upon which
there will be a fight, went over un
til tomorrow. The bills providing for
a clerk for the mining inspector and
for voting places went over until
Wednesday. The governor today ap
proved these house bills:
No. 210, paying the deficiency of
the national guard for the state en
campment of 1905; No..234, bills of
e02ptLQu; No., 122, defining the;t
comani n s;" Nd& 132, preventing mid
representation by life insurance com
panies; No. 232, trials of civil act
ions; No. 236, publication of sum
mons; No. 175, redemption and pay
ment before maturity of county and
school bonds purchased by the state;
No. 164, strengthening the law against
forgery and preventing the passage
of counterfeit money. 'ihe senate
committee on towns and counties did
not report on the Roosevelt county
bill today, as expected. It is under
stood the committee will present an
adverse report tomorrow.
not of free and voluntary confession
of the defendant, but because of a
fear which had been' instilled into his
mind and by the promises held out
to him in the event such confession
were made."
The motion was denied and an ex
ception asked for and allowed.
Defense Opens.
Clarence S. Darow then made the
opening address in behalf of the de
fense, the jury having been called
into the room. He gave a sketch of
Adams' life and his connection with
the Western Federation of Miners,
slhowing how he had been incarcerated
in jail at Independence for 93 days,
three days after his marriage, and re
leased after no charge had been pre
ferred against him. He showed how
Adams had been driven from Inde
pendence to Denver and how he had
comle from there in company with
Simpkins to take up a homestead in
northern Idaho, describing conditions
in Marble Creek and the advent of
claim jumpers.
He showed how Tyler located and
placed a cabin on the claim owned by
Simlpkins. rind how they astayed there
ut ii about August, when Adams at
tended a birthday party at Mason's
cabin, August 7, and how Adams
changed his name to Steve Dixon un
til he thought that all the Marble
Creek trouble had been forgotten.
Darrow detailed all of Adams' move
ments in the Marble Creek district up
to August 8, when he left by boat
for Spolkane, stoying two days in a
cheap lodging house at Coeur d'Alene
on the way. He returned to St. Joe
about August 17 and stayed with
Glover until about August 20, the
day Boule was killed. August 24
Adams re'turned by way of Spokane
to Denver. It then transpired that
Tyler had not been seen, and Engs
trom, the president of the Jumper
Killers' association, was arrested for
killing Boule, but the charge was
dismissed. Nothing more was heard
for a year, when an assassination took
place at Cardwell and Adams was
arrested while on a farm in Oregon
on this charge. He was arrested by
a man named Brown, a sheriff, and
shortly after Brown said to him:
(Continued on ]EIghh Page.)
WILL FORCE
SHIP SUBSIDY
House Adopts Rule Insuring Action
on Littauer Substitute.
OPPOSED BY REPUBLICANS
Many Western Representatives Join Mi
nority in Voting Against Resolution.
Washington, Feb. 25.-The ship sub
sidy secured a marked impetus today
in the house, which just before ad
journment adopted a rule that will
probably insure the passage by the
house of the Littauer substitute for
the senate bill and result before the
final adjournment in positive legisla
tion.
The rule was reported by Dalzell in
the shape of a resolution providing
that the compromise bill shall be con
sidered, with debate limited to five
hours, and that the final voe shall be
taken not later than next Friday after
noon at 3 o'clock. The rule was adopt
ed by a .vote of 158 to 122, 24 repub
licans, voting with the democras in
opposition to the rule.
The rule was agreed upon unexpect
edly by the rules committee at a
meeting held after the visit of Secre
tary Root to the capitol, and it was
very generally iuderstooL that the ad
m1ists tfoý wag respolsible for ,the
Tle conferece .
bill was adopted, M .was the confer
ence report on the bill providing for
the allotment and provision of Indian
tribal funds.
After the previous rule had
been ordered, Mr. Dalzell explained
what was aimed to be accomplished
by the rule. Under the rule there
will be five hours of general debate.
Then the house substitute will be read
for amendment under the five-minute
rule, and at 3 o'clock, the previous
question having been considered, the
vote will be taken on its final pas
sage.
Williams, minority leader, opposed
the rule. Regarding the attitude of
Speaker Cannon he said.
"There was a time when you your
self, Mr. Speaker, waxed eloquent
and earnest in regard to legislation
like this. In those days you were a
Samson in conflict and a Solomon in
council. Today Samson is shorn of
his locks and Solomon has guiown
fond."
Democracy, he said, was against the
measure. It was in the interest of
the rich and against the poor, and of
those .who had, against those who had
not, Mr. Williams thought it worse
than the tariff because the later pro
fesses a virue while this was a naked
,special privilege.
De Armond, of Missouri, said it was
WAGE SCALE IS RAISED
Eutte Miners Agree to Increase by a
Vote of Three to One-Trouble
Looked for.
(Special to The Gazette.)
Butte, Mont., Feb. 25.-Returns to
midnight show that the amendment to
the constitution of the Butte Miners'
union increasing the wage scale to $4
a day will carry by a vote of 3 to 1. A
total vote of 3,600 was cast. If the ul
timatum of John D. Ryan, managing
director of the Amnalgantated Copper
company, is carried into effect, in con
sequence of the demand for an in
crease, there will not be an Amal
gamated miqe in operation Tuesday
night.
MAKES GOOD HIS ESCAPE
Revolutionary Leader Breaks Away
From Officers, and Is Now Hiding in
Mountains-Is Badly Wanted.
El Paso, Tex., Feb. 25.-Somewhere
in El Paso or in the mountains around,
securely hidden from a large force of
United States officers that are 'dili
gently searching for him, is Antoneo L.
a bill in the interest of the .rich and
powerful. He called attention to
those who were pushing the bill now
and their views on the same subject
only a year ago.
Grosvenor closed the debate on the
rule. He said Williams had said it
was an anti-democratic measure,
which he conceded, but, he said, ship
subsidy had been a democratic meas
ure down to the passage of the law
of 1901 and that every democratic
Istatesman of past days had been its
advocate. "The difficulty with the
other side," he said, "is that you are
trying to be democrats and belong to
the democratic party at the same
time."
He said the bill if passed would not
take a single dollar out of the treas
ury of the United Sates, but rather
add to the profits because it would
enlarge the foreign' mail service.:.
"Some men 'hav "beeen going sbqslt.
telli&ig the ,people that this . tin l,`
awgrdgd until there is .proof that
there are at yeast' 27 new ships built~l
absolutely. from the ground up and
that they are approved by the navy
department as capable of traveling 16
knots an hour in continuous service,
built in American iship yards and man
ned by American sailors. This will
drive out of the contract every ship
of the Harriman line. There is not a
ship of the Harriman line or one ship
of the Jim Hill line that can go 16
knots an hour under any pressure 'that
can be 'put on it. We simply propose
to extend our mail service to South
America and to the Orient."
The resolution as reported by the
committee on rules was adopted:
Yeas, 158; nayes, 122. Twenty-four
republicans voted with the democrats
in opposition to the rule, as follows:
Burton of Ohio, Campbell of Kan
sas, Chapman of Illinois, Darrah of
Michigan, Davis of Minneapolis, Ford
ney of Michigan, French of Idaho,
Craff of Illinois, Hedge of Iowa, Hen
shaw of Nebraska, McCarthy of In
diana, Hubbard of Iowa, Kinkaid of
Nebraska, McCarthy of Nebraska,
Madden of Illinois, Marshall of North
Dakota, Murdock of Kansas, Nelson of
Wisconsin, Prince of Illinois, .Stafford
of Wisconsin, Steenerson of Minne
sota, Townsend of Michigan, Weems
of Ohio and Wilson of Illinois.
Villareal, editor of the revolutionary
organ, "Regeneracion," and head of
the St. Louis junta of Mexican revolu
tionists, whohas been in prison here
under charges pending before both the
United States department of justice
and the department of labor and com
merce, and whose fight against extra
dition and death in Mexico has at
tracted widespread attention.
Villareal had been before United
States Commissione Howe for a hear
ing on the two charges of being in the
United States in violation of the laws
of neutrality, and of being here in
violation of the immigration laws. The
first case was dismissed, and he was
remanded to jail under the second
charge now on appeal before the de
partment at Washington.
On the way to jjail he asked permis
sion to send a telegram, and was al
lowed to enter the telegraph office
while Interpreter Antonio Sierra, who
had him in charge, and Immigrant In
spector Schumacker stod in front of
the door. Villareal sent the tele
gram, .walked out of the front dor.
dodged into an alley and disappeared.
Every immigrant officer and others
in the city have searched unceasingly
for him since, without discovering the
slightest trace of him.
PASS MANY PENSION BILLS.,.
Washington, Feb. 256.-Atý tonight's
session the senate passed 300 private
pension bills, clearing the calendar
of such measures.