Let us see how this works out. He says that these roads. receive $22,641,000 out of a total compensation of $33,876,ooo, and that they carry nine-tenths of the total weight of the mail, which that year was 528,000,000 pounds. Take ninetenths of 528,000,000, which is 475,300,000, and divide the $22,641,000, which he says they receive, and you will find that they receive 4 19-24 cents per pound for every pound they carry ; and yet he tells us in the next paragraph (and this is the sort of rubbish they present to the Committee on Appropriations) that

A small portion of this tonnage, namely, up to 5,000 pounds, on these heavy routes goes at 4 cents a pound for the haul of 448 miles; but the great weight (over 4,000,000 pounds per day) is carried at the legal minimum of 1.3 cents per pound.

But the Department says the average distance mail is carried is 328 miles.

Then he says

It is a matter of mathematical demonstration.

I should think it was; and so on, all through the statements of these railroad attorneys we have this same misleading, confusing and deceptive testimony. I do not say that these men committed perjury, for we did not swear any of them. They made statements.

You recollect, Mr. President, that in the examination of the trans-Mississippi freight rates, the railroad managers all came in and swore that there was not a pool, and finally Mr. Stickney, who was manager and president of the Great Western Railroad, came in and swore that there was a pool, and that he was in it. In other words, they protect the service they are engaged to protect, and to protect the railway service of this country requires a peculiar conscience.

On page 65 is the statement made by the Louisville and Nashville road. I noticed this statement when it was being read by the Secretary and I made a memorandum of it:

I think it is proper to suggest that the railroads have the right to expect the Government to pay them at least as much for the use of their passenger trains, in proportion to the labor performed and the

services rendered, as the public using the same trains pay. But the company's statistics show that the Louisville and Nashville Company secured for the year ended June 30, 1897, net earnings per car mile for the transportation of passengers, after the payment of operating expenses-not including interest and taxes-6.23 cents, while from the mail they only secured 4.96 cents, a difference of over 25 per cent in favor of the passenger account.

You will find on page 124 Mr. White's statement that the average pay per mile for every single one of the postal cars. used by this country is 6.84 cents per mile, as against 4.96 cents according to this statement.

Then on page 66 we have the price they charge for carrying freight 10 miles. That includes not only the transportation, but the cost of getting the freight, the depot charges, terminal charges, which make up the bulk of the cost of doing the freight business; and in this connection I will put into the RECORD the statements of various roads as to the cost of handling freight cars and freight trains after the trains are loaded.

The Government loads the mail on a train. Then it is carried by the railroad company, and yet the railroad attorney who makes this statement compares the total freight rate with the amount that the Government pays simply for hauling the freight over the road, and then he takes the smallest possible distance they have-10 miles—and therefore the highest rate. He says for 10 miles or less the charge is 12 cents per 100 pounds, while the Government pays only 5.6 cents per 100 pounds, leaving out entirely the cost of securing the business, which is the chief item in a short haul of 10 miles for freight.

COST OF HAULING FREIGHT CARS ON THE UNION PACIFIC ROAD.

In 1890 the cost of hauling a loaded car (on the Union Pacific Railroad) 1 mile, that is, including all the expense of the locomotive and car departments, was 3.17 cents a mile; in 1891 it cost us 3.05 cents; in 1894, 2.65 cents, and in the month of October, 1895, it cost us 2.01 cents to haul a loaded car 1 mile.-Statement of J. H. McConnell, superintendent locomotive power, the Union Pacific Railroad. See Railroad Review, February 29, 1896.

COST OF HAULING FREIGHT CARS ON THE SOO LINE.

On May 1, 1895, the Soo Line commenced rating its locomotives on a tonnage basis. The cost per mile of hauling freight cars in 1894

was 1.18 cents, and in 1895 it was I cent.-Railroad Review, March 28, 1896.

In his paper on "Locomotive Service," published in the Railroad Review of January 18, 1896, Mr. McConnell stated that on the Union Pacific 26 loaded cars are now hauled by the same engine that used to haul 22 cars, and in one case the increase had been from 28 to 35 cars. He also said that the additional cost to a train by attaching thereto an additional loaded car would only be the value of 5 pounds of coal per car mile, and in a yearly course of 36,000 miles the increased cost would only be the value of 90 tons of coal.

As to the wastefulness of our private railway managers in the use of their freight equipment, the following is of importance.

In a paper read at the December, 1896, meeting of the St. Louis Railway Club, J. R. Cavanagh, superintendent car service of the Cleveland, Cincinnati, Chicago and St. Louis road, said:

"There are about 1,750,000 freight cars owned by railroads in North America, representing an investment of about $500,000,000. From the best information obtainable these cars average a little over 6 tons per mile, or about 10 tons per loaded car mile. Freight equipment is idle an average of 75 per cent, or in service about 25 per cent of the time. What causes this large percentage of idleness? Delays incidental to loading and unloading, switching, terminals, etc., consume a portion of it; but as much time is lost waiting for loads, giving loads preference over empties, holding for home routes, for transfers, etc."

Car Accountant Wheatly of the West Shore road, says that of the freight car equipment of the United States in 1892, 248,000 cars were absolutely idle, and these cars representing a capital of $124,000,000, occasioned not only a loss of the interest on their cost, but an additional loss of $10,000,000 annually for their maintenance, to say nothing of the cost of track room to hold them, locomotives to move them, and the other minor yet necessary expenses which their existence involves; and still, he says, the private managers of the railroads pay over $30,000,000 a year for the use of private cars, and Mr. Wheatly's figures as to the cost of private cars are supported by the testimony of Mr. Aldace F. Walker.-Railroad Review, September 3, 1892.

I may also add that S. P. Bush, superintendent of locomotive power of the Pennsylvania lines west of Pittsburg, makes the cost of hauling loaded and empty cars the same. In the Engineering News of June 3, Mr. Bush states that on a run of 115 miles from Chicago to Logansport, Ind., an increase in the load of a freight train of 32 cars from 750 to 1,050 tons occasioned the use (the additional cost) of but 400 pounds of coal. There was no other increase of expenses. In other words, the cost to the road for the haul of the additional 300 tons of freight for a distance of 115 miles was but the cost of 400 pounds of coal, certainly less than 50 cents.

For further information on these points note pages 145 and 146 of my book, A General Freight and Passenger Post.

As to passenger trains, the railroad reports of the year 1897 show that the trains run with only about one-sixth of the seats occupied. JAMES L. COWLES.

I find that Mr. Dudley, in making his statement for the railroads for which he is attorney, says:

The report of the Interstate Commerce Commission for 1897 gives the cost of the railroads of the United States at $12,179,865,771.

That is the amount they are bonded and stocked for, but nobody pretends that that is what they cost, and Mr. Dudley knows they did not cost that sum. But he lays that down as a premise from which to make an argument and draw conclusions to convince us that the railroads receive too little compensation for carrying the mails.

So with these half falsehoods, these misleading statements all through this evidence, on almost every page of it, they undertake to make up a case to justify them in charging ten times as much per pound for carrying the mail as they charge for carrying express matter.

I beg pardon of the Senate for presenting this subject in so disconnected a way; but the investigation was a hurried one, and we have had little opportunity since the investigation to look into the matter and digest this mass of testimony. I wish I had more time and could have presented it in a better

manner.

CHAPTER XVIII

MORGAN AND CO.

The Senate having under consideration resolution submitted by Mr. Peffer, providing for a committee of five Senators to investigate and report generally all the material facts and circumstances connected with the sale of United States bonds by the Secretary of the Treasury in the years 1894, 1895, and 1896

M

R. PRESIDENT, I simply wish to give a history,

so that it may appear in the RECORD, of the numerous bond sales made by the present administration.

It has been the policy of the present administration to destroy the use of silver as a money metal, and to manipulate the credit of the United States in such a manner as to enrich its favorites, while piling up a load of debt to oppress the whole people. The first step was the extra session of Congress called for the purpose of repealing the purchasing clause of the Sherman act. The call for the extra session was a direct attack upon the credit of the United States, and it was preceded by a concerted movement of the banks of New York, inspired from Washington, to curtail mercantile credits and bring about the panic of 1893 as an object lesson to Congress. The panic started by the banks soon passed beyond their control, and involved the country in disasters from which it has not yet recovered.

Then came the enactment of the Wilson tariff for a deficit, a measure framed upon sectional lines, and intended to protect all Southern industries and those of districts represented by Democrats, while the industries of Republican States and Congressional districts were intended to be left defenseless against foreign competition. Fortunately for the country, the rules of 1. Speech in the Senate May 5, 1896.