HARRIMAN RAILWAYS.

Evening Star, Issue 14163, 13 September 1909, Page 7

HARRIMAN RAILWAYS.

, GUARDIXG AUAIXST A RAID

Press Assodatijn—By Telegraph—Copyright

XEW YORK, September 11

Big money interests in. Xow York, it.eluding Rockefeller. Morgan, the Fn-t Xational Bank. Kului. I.oeh, Spcyor, James Stillman, and Frick. have combined to prevent ".bear" raids. The combination continues until it is certain that Mr Haniman's interests are in sifo and capable hands. It is reported that the combination has guaranteed £5,000,000 For the purpo-e of supporting the market. The chief Haniman stocks have risen 6 to 12 points. "THE'COLOSSUS OF ROADS." Mr Edward H. Harriman, nicknamed "'Hie Colossus of Roads," was the greatest railway magnate in America, and one of the must discussed Americans during the last few years. He was born sixtv-ono years ago, the uon of nn Episcopal clergyman, and began life a poor man. When fourteen ho went into a Wall street broker's office, and at eighteen he became a partner in the firm. At twentv-twc he struck out for himself, and* bought a teat on the Stock Exchange. His first experience with railways was with a little line that ran south from Lake Ontario. He transformed it into a good line, made it pay, and sold it to the Pennsylvania. Company. Some years later he became acting president of the Illinois Central, just when he was thinking of retiring on his means and devoting himself "to more intellectual pursuits." This changed his life. He set the Illinois Central on its feet by adopting the then novel method of spending money on the line for the sake of future dividends, instead of running it as cheaply as possible so as to pav largo dividends in t"he present. From that time his operations extended until ho controlled a vast railroad system from Omaha to California and Oregon, and from San Francisco to New Orleans, via Los Angeles. Several other lines in the Eastern States were allied to this system. It was he who vitalised the Union Pacific system, with its thousands of miles of line,'burdened with a debt of 54,000,0C0d01. Mr Harriman went over the line, noted what improvements were needed, and went in boldlv for a rebuilding scheme that ultimately ' cost 20,000,000d01. The wisdom of the policy was proved by the subsequent earnings o"f the line. Ho purchased the huge South Pacific system of 9,000 miles for over 100.000.000d01, and spent lavishlv on improvements. Tho gross income of'his whole railway system in 1906 was 170,000.GC0d01, and the dividend disbursements 28,000,000d01. —His Methods Criticised.—

Of recent years his methods have been tho subject of much criticism. "From the flood of technical evidence elicited by thcInterstate Commerce Commission's investigation into Mr E. H. Harriman's method of buying and managing railroads from Wall street, two salient features have already emerged sufficiently to impress themselves dearly upon the lay mind," said a wellknown American weekly in 1907. " These are the almost incredible ext-.nt of the railroad control that Mr Harriinan has gathered into hLs own kinds in the brief space of six years, and the apparently unlimited possibilities his method offers if its legality can be successfully defended. The Wall street journal suggests that he is perhaps tho most powerful individual in the United States, not even excepting the President. The powers of the' latter are carefully restricted by a written Constitution, and his every act is subjected to the white light of publicity. But Mr Harrinian, it argues, is practically dictator of a great railway system representing more than a billion dollars of capital, with power absolute and unquestioned until the present investigation began. In tho first place, it seems, the directors of the Union Pacific surrendered to him authority to borrow such sums of money as might be needed, and to pledge of the company as collateral for any notes which he might 6ign. With thiii authority he started in to buv and sell stocks by tho hundred million, 'making as little of it,' says the Philadelphia 'lnquirer,' 'as a woman buying a dozen eegs." By his genius and daring in finance hesecured controlling interests in various roads, notably the Southern Pacific, the Oregon Short Line, and the Oregon Railway and Navigation Coin]wny. In tho past six months, by the expenditure of 100.000,000d01, he has bought stock in seven other roads. Now, according to 0. M. Keys, a writer in the ' World's Work,' he is the head of over 25,000 miles of American railroad, and has on his pay roll more than twice as many men as there- are. in the standing army of the United States. In short, ' he has ceased to be an individual; he has become a national figure, perhaps a national menace."' —Steamem Ako.—

In addition to railways, ho controlled three steamer lines. Mr Hariimnn's method of extending hie dominion in the railroad world was thus described by the Chicago 'Journal':—"He gets control of a railroad, issues bonds on it, and with the proceeds buys another railroad, on which he issues bonds, with tho proceeds of which he buys a third railroad; and so on."