CABLE NEWS.

Evening Post, Volume LXXIII, Issue 129, 1 June 1907, Page 5

CABLE NEWS.

[nr ELECTRIC TKLEGRAPU.— COFYBIGIIT ] «. . CAPITAL AND LABOUR. O AMERICAN TRUSTS,

THE ROOSEVELT POLICY. PREDATORY WEALTH WORSE THAN SOCIALISM. FrnEss association 1 MEW YORK, 31st May. President Roosevelt, speaking at Indianapolis, said property was in less jeopaid^ from Socialists and Anarchists than from prodatory men of wealth. The Government, ho said, did not inten I to refrain from asserting the right of the nation to control the use of wealth by business concerns, especially in corporate form. Tho Government must oxcrciso over railways a power analogous to that exercised over rational banks. It must prevent overcapitalisation or undue inflation of securities. " Every honestly managed railway," said Mr. Roosevelt, " will gain under this policy. The Government purpose is in no sense punitiva or vindictive. No individual Stato is powerful enough to cops legislatively with powerful corporations engaged in inter-State commerce." This is evidently a reply, as far as tho President's attitude to railways and trusts is concerned, to the dictum of Lord Rothschild — now apparently backed up by Lord Avebury — that "tho attack on tho railways in America, the income-tax and other problems in Franca, and the socialistic movonicnt in England were killing tha goose that lays tho golden eggs." Ths key to the President s remarks on this occasion is found in his spsech in Massachusetts in February last, when he said :—": — " Honest and fair-dealing railway corporations will gain, and not loso, by adequato Federal control. Most emphatically it is both tho duty and tho interest of cur poopla to donl fairly with such corporations, and to sea that a premium is put upon tin honest management of them, arid that thoco who invost their money in them aio amply protected. But those who invoko t'.iD doctrino of Stato rights to protect Stato corporation creations in thoii predatory activitiss, extended thiough other States, arc as short-sight-od as those who once invoked the samo doctrina to protect special slave-holding interests. Tho States havo shown (hat they havo not tho ability to curb tho power of syndicntad wealth; theroforo, in tha interests of tho people-, something must be dono by national action." As to tho t'lttica of predatory wealth, the Now Ycrk correspondent of the Sydnsy Morning Herald, referring to W«llstjael disturficnecs, wiite.i : — ■" Tho real caur/2 of tho panic, prolnbiy, was tho testimony of Mr. E. 11. Hqn'iman (who cdmitlodly controls one-sixth of nil A"nir>i ican railroads), whon nftr>i' months of delay, caused by alleged cirkness, tho Interstate Commnrcs Commission at last eve eroded in putting him upon the rack, lie confessed I hit in ono typical deal h<? and his associates, using not their own but ccrpoiato, funds, had boi:ght r, vailro.-.d, and turn put it into r. grentsr combination at a cash profit to tlnniBslVe* ofGOODOOO dollars, and had noxt issued 40,000 000 oi bonds upon tha com. binatio.i, sold thim to tl\3mselvos at 65, nnd than resold them to insurance nnd trust companies at CO and 95. Of norily 00 000,0C0 dollavo of c.-pital <iominaUy added to Ihi combined properties, only 2D COO 0:0 dolhiD roprc3 jilted actual cash cpont in raib nnd rolling stock, tho romiiindsr v.-.s what American.': «'.jll 'wator.' The purpose of this fictitious appreciation was twofold — to mnko investors bslieya that Borne day tho crtgrr.ved ccrtitlcotsu v/»,'ild be. worth tha value printed unoa thsm ; and, secondly, to be ab'.o to claim before investigating comivitloos (lint sluppei-j and passengers ! inrst pay high enough rates to yield a "air votum i'co.i tho 'capital' apparently investod . . . In tho autumn, how- I over — or cai'licv, if an extra session should b: called— tho President will a»k for much now legislation— his latest suggestion boing that Ul3 appraised value of t railroad and uot its ' capitalisation should by law bocomo a factor to be cGiisidcrad by the Interstate Covnmeico Commission in deciding as to the justioo of rates of freight. Such a principK. if adoptod, would 'squeeze' out tho ' wator ' from inflated stocks, but its practical application would meet obvious difficulties."