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PAGE TWELVE Wants Harriman Prosecuted for Violating Lalos (The New York Herald.) That the inquiry conducted by the Interstate Commerce Commission into the conduct of railroads controlled by E. H. Harriman will result in prose cutions was plainly shown by the pub lication in the New York Evening Telegram recently of the report and recommendations of Messrs. Kellogg and Severance, counsel for the com mission. The commission will soon take up this report, vote upon it, and send to the Department of Justice the evidence tending to show the Harri man school of railroad financiering has operated in violation of the Sher man anti-trust laws and other stat utes. The exclusive publication of this important report by the Evening Tele gram proved a decided shock to some members of the commission. The document submitted to the commission by Messrs. Kellogg and Severance, who have been unrelent ing in their search for facts connected with the absorption of railroad after railroad by Mr. Harriman, covers twen ty-five typewritten pages. It has yet to be considered by the commission as a whole, but this has simply been de ferred because there are one or two points into which the commission de sires to probe further. Points of the Report. The main points of the report re cite: That railroad competition has been absolutely ended in an area equal to one-third of the United States, in which Mr. Harriman is absolute mas ter. That Mr. Harriman’s contracts with the Rock Island, Southern Pacific, Santa Fe, Illinois Central and San Pedro railroads are in violation of the anti-trust act, and counsel is in favor of proceedings against them by the government. That the purchase of the shares of one railroad by another is an evil practice that should be stopped by law. That there should be new and ef fective laws to prevent inflation of se curities like that of the Alton reor ganization. That the profits of the great rail roads of the far west are being used to buy and control railroads in the east, instead of building more roads for the development of the west. The report is based on develop ments in the Harriman hearings. The Southern Pacific has voluntarily ab rogated the contract with the San Pe dro route, which Messrs. Kellogg and Severance have repeatedly said they believed was in violation of the Sher man law. Laid Before President. Facts revealed as to use of west ern railroad profits to buy control in other railroads have been made the basis of informal recommendation by some members of the commission to President Roosevelt in the interest of further legislation. In its report the commission tells briefly the story of the Union Pacific’s reorganization and of the establish ment of Harriman’s control; of its ac quisition from the Huntington estate of control of the Southern Pacific; of the elimination of competition be tween these two roads. It is declared that these two systems are naturally and inevitably competitors for a vast traffic between the east and the west and to the Orient, and that their joint control by owe Interest is a violation of the Sherman law. Prior to the passage of the Interstate Commerce law they belonged to the trans-conti- WATSON’S WEEKLY JEFFERSONIAN. nental pool, in which each road was awarded a fixed percentage of the traffic. Under the Union Pacific organiza tion, the report points out, the ma jority of directors in each of these companies has also constituted the majority in the other. Mr. Harriman has been president and chairman of the board in each and as chairman he has been delegated all powers of the board when it was not in session. He is absolute in both. Their by-laws have been amended and made approx imately uniform, so that Harriman has all the powers of the directors and the executive committee. All the huge financial transactions have been made by him and later approved by his dummy directors. Making Clark Surrender. The commission’s report tells the story of Senator Clark’s effort to build and operate the San Pedro road as an independent line. He was well on the way to completion of his line when Harriman blocked him. Part of the iky EDWARD IL HARRIMAN. Head of Union Pacific, South ern Pacific and other railroads. right of way which Clark was using consisted of a route through a canyon about sixty miles long, in Nevada, known as Meadow Valley Wash. This route had once been owned by the Oregon Short Line, but had been re linquished many years before. When Clark was ready to build through the canyon the Oregon Short Line revived its claim, started a litigation, began building a road through the pass and threatened Clark that if he construct ed his line it would parallel every mile of it, and, having all the connec tions for handling through business, would make his road absolutely profit less. Clark finally surrendered and en tered into the contract with the Har riman system by which the latter se cured half the stock of the San Pe dro road and absolute domination in all traffic matters. Since the investi gation announcement has been made that the Union Pacific has bought the other half of the stock and now owns absolutely the whole road. Thus was killed the last attempt to secure com petition in this great region. Clark is reputed second wealthiest man in the world, and he felt that he had a grievance against the Southern Pacific because of the high rates charged him on the ores from his cop per mines. But even his great wealth was not enough to enable him to fight the Harriman system. It was the end of competition throughout that. area. The Santa Fe was brought into sub jection, Harriman and his associates buying stock In it till they were able to force two of the Union Pacific di rectors, Henry C. Frick and H. H. Rogers, on the Santa Fe directory. Some time afterward the Southern Pacific and Union Pacific, each own ing some minor pieces of road north of San Francisco, planned to develop these into more important routes, and to connect them up into important lines along the northern Califor nia coast, As they would have been competitors, an arrangement was completed by which the Northwestern Pacific road was or ganized, took over all these minor lines, and undertook to develop them into a single system, which should be jointly owned by the Santa Fe and the Southern Pacific, each holding control for a year at a time in alternation. This is exactly the plan under which the Union Pacific and Rock Island jointly control the Alton; and the commission finds that in both it is in violation of the anti-trust act, and recommends that the attorney-general proceed against it. Remarkable Stock Watering. The famous financial irrigation pro ject in Chicago and Alton receives more attention in the text of the re port than any other one matter. It is declared “the most remarkable story of manipulation and stock wa tering.” The men named are E. H. Harriman, Mortimer H. Schiff as rep resentative of Jacob H. Schiff, James Stillman and George J. Gould. When they bought up the shares of Alton it had a complete capitalization of $33,- 900,000 —stocks, bonds and floating debts. In seven years they increased this to $114,000,000, and in that time they spent only $18,000,000 in better ments and extensions. In other words, the report says, they added $65,000 per mile to its capitalization without “one dollar of consideration.” The story of how this was done is told in detail, but for the first time in understandable fashion. It has been repeatedly outlined in the newspaper reports of the hearings several weeks ago. Some sharp accusations are made against Harriman. The investment by the Union Pa cific of more than $182,000,000 in the securities of other railroads is ana lyzed in detail, and a table is given showing in what roads Union Pacific money has been invested. Since June 30, 1906, these purchases are stated at $132,000,000, consisting in the main of $10,000,000 of Santa Fe, more than $45,000,000 of Baltimore and Ohio, more than $6,000,000 of Chicago, Mil waukee and St. Paul, $41,000,000 of Illinois Central, $20,000,000 of New York Central and $2,000,000 of St. Jo seph and Grand Island. The Union Pacific is shown to hold, besides com plete control of the Southern Pacific, 21 per cent of the common and 12 per cent of the preferred in the Baltimore and Ohio, 29 per cent in Illinois Cen tral, nearly 8 per cent of Santa Fe. 6 per cent of Chicago, Milwaukee and St. Paul, 8 per cent of New York Cen tral and control of St. Joseph and Grand Island. It owns practically all the bonds and stock of the Oregon Short Line and all the stock of the San Pedro road, amounting to $25,- 000,000. It holds in addition to all this about $20,000,000 worth of securities of the Hill system, and has sold $116,- 000,000 worth of Hill road securities which wore purchased a number of years ago. Abandon Ocean Line. Prior to the Union Pacific’s acqui sition of a big Interest in the Santa Fe, the latter system operated a line of steamships from San Diego to the Far East, connecting with the rail road. Now that has been abandoned, and the Pacific Mail, controlled by the Southern Pacific, has a monopoly of this ocean going business, conduct ing it in connection with both roads, the Santa Fe and Southern Pacific at present getting equal shares of the tonnage derived from this source. The commission finds that for sev eral years, under the Southern Paci fic-Santa Fe agreement, there has been absolutely no competition in the fruit traffic from California east. Sixty per cent of this business is tributary to the Santa Fe, but the traffic is divided in the proportion of 45 per cent to the Santa Fe, 45 per cent to the South ern Pacific and 10 per cent to the San Pedro line. Right after the Los An geles hearing, when all these things were made public, these three lines simultaneously announced a 10 per cent reduction in rates on fruit, which will save the growers about a million dollars a year. The commission ven tures the opinion that the reduction was the direct result of the publicity. Taking up the relations of the Un ion Pacific to the Illinois Central, the commission finds that there is no doubt about Mr. Harriman’s absolute control of the latter system. It points out further that control of this road is of the greatest importance in order to enable the Harriman system to fence in the immense area surrounded by its various lines, to have a route from the grain district to the Gulf, and to stop competition of the Illinois Central with the Alton. In fact, in the immense area west of the Mis souri, dominated by the Union and Southern Pacific, Santa Fe, San Pe dro and their related lines competition has been utterly killed. WHERE CAIN KILLED ABEL. (London Tit-Bits.) While cycling around Kettering I was startled to see what appeared to me to be two men fighting in a field. On reaching the field I dismounted and climbed over the fence to see what it was, and discovered that it was a stone statue representing Cain slaying Abel. It is unique. Cain has one knee pressing Abel to the ground and one arm uplifted ready to strike. The statue must be hundreds of years old, and is supposed to be on the ex act spot where the murder was com mitted. THE GREATEST MIGRATION. (Geographical Magazine.) No migration in history is compara ble to the great hordes that have crossed the Atlantic during the last twenty years to enter our territory. In 1905 1,026,499 immigrants were ad mitted; in 1906 1,100,735, and in the present year the total will exceed the record of 1906 by many thousands. Since June 20, 1900, 6,000,000 have been admitted, of whom probably 5,500,000 have settled permanently in the United States. OLD MAGAZINE WANTED. Does any reader of The Jeffersonian happen to have The Southern Review for 1873? This was the magazine published in Baltimore under the auspices of the Methodist Episcopal Church, South. The editor was Dr. A. T. Bledsoe. Mr. Watson would be glad to bor row, or buy, those numbers for 1873 containing the series of articles writ ten by Dr. Samuel Tyler, and enti tled, “Peggy O’Neal; or, the Doom of the Republic.” Mr. Watson will greatly appreciate the kindness of any friends who may tell him where the desired back num bers of The Southern Review can be found.