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 The Erie war. 
 
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THE ERIE WAR. 
 
 The Erie Controversy has two points of interest — a 
 speculative one for Wall Street, and a permanent and vital 
 one for all wlio desire, by reducing tlie cost of transpor- 
 tation, to lighten the burdens upon the poor, to increase the 
 gains of the rich, and to add to the prosperity of our city by 
 attracting to it, through highways economically constructed 
 and prudently managed, the foreign and domestic trade of 
 the country. 
 
 It is for the latter class we speak. With the squabbles 
 at the Stock Exchange, with the "longs and shorts" we have 
 nothing to do, so long as these contests have no other purpose 
 than to put stocks "z<p" or "dowji.'" But when such con- 
 tests terminate in a struggle for the possession of great lines 
 of railroad for the purpose of wielding these tremendous 
 engines for the promotion of individual aggrandizement or 
 wealth, at the sacrifice of the public welfare, then we feel 
 called upon to interpose, to strip impudent pretence of its 
 gtiise, to dispel a wide-spread, and — ^if persisted in — ^fatal 
 delusion, and to defeat schemes most iniquitous in themselves, 
 and hurtfal to the public. 
 
 The Brie War is a struggle for the possession of the 
 railway of this company, as the necessary condition to the 
 success of a grand scheme — ^the virtual consolidation of the 
 Hudson Eiver, Harlem and JSTew York Central EaUroads ; 
 or rather, to enable the parties to such scheme to secure to 
 themselves advantages which are possible only by holding 
 the key to all the great avenues of this State entering the 
 city. So long as one eludes their grasp, they are wanting 
 the Tnonopoly necessary to enable them to levy, or seek to 
 levy, upon the public and upon commerce, vexatious and 
 
oppressive burdens for the purpose of paying extravagant 
 dividends upon the enormous additions to the share capital 
 of the several companies, to be made as soon as their plans 
 are complete. 
 
 The great leader in this fight is Mr. Vanderbilt. He and 
 his crowd have the Hudson Eiver, Harlem, New York 
 Central, Lake Shore from Erie to Toledo, and the virtual 
 control of the line from Bufialo to Erie. Over this vast 
 extent of line he reigns supreme. In his attempts to reach 
 Chicago, he was aiTcsted at Toledo by his inability to get 
 control of the Michigan Southern. To counteract his plans, 
 it became the interest of this, and of all the roads entering 
 Chicago, as well as of the Erie, to open, if possible, a new 
 and independent line to New York. Indeed, we may say 
 that such a line was of the most vital importance. It 
 required the construction of only about 100 miles of new 
 road, extending from the Atlantic and Great Western to 
 Toledo. When the broad gauge reached the latter point, 
 the Michigan Southern Eailroad agi-eed to lay a thu-d rail to 
 Chicago. As the new link could be constructed at a very 
 small cost, there were plenty of parties who stood ready to 
 supply the money, provided the Erie Company would guar- 
 antee the payment of the bonds of the company that was to 
 put in the link, to the amount of $2,000,000. This the Erie 
 Company agreed to do. The Vanderbilt party, seeing in this 
 arrangement the defeat of their gigantic monopoly, sought by 
 every means to defeat such action, both by buying up the 
 stock of the Erie Company and by every possible resort to 
 Courts of Law. Hence the tremendous struggle which we 
 now witness. 
 
 Mr. Vanderbilt commenced his attack upon the Erie 
 Company with immense odds in his favor. He has vast 
 wealth, and the reputation of being most skilfal in adding 
 to it ; but, above all, he had the reputation of being by far 
 " The Greatest EaUroad Man " of this country, and perhaps of 
 all time — of possessing the ability of infusing life and vigor 
 into railway management. His magic touch could even 
 " create a soul under the ribs of death 1" There is no argu- 
 
ment like success. " See what tie lias done in Hudson 
 River " was enougti to strike dumb tlie most skeptical. The 
 Vanderbilt stocks became the card. A person had only to 
 buy them to be rolling in wealth. Peeans of praise and 
 adulation rose from every side, echoed and re-echoed from 
 the city press. The adulation which Morse enjoyed for a 
 few brief months was nothing to it. His star was pale in 
 comparison with the new luminary, of whose reign there 
 seemed to be no end. 
 
 Notwithstanding the general voice, so clear and decisive, 
 we still, with becoming modesty, propose to investigate a 
 little the pre-eminent abilities claimed for Mr. Vanderbilt as 
 a "Eailroad Man," perhaps to challenge their existence, and 
 to inqufre whether such reputation, instead of being de- 
 served, or founded in any good reason, is not rather like 
 that of a predatory chieftain who wins much plunder, dis- 
 tributes lavishly that which cost him nothing, and keeps 
 good cheer. 
 
 The capital with which Mr. Vanderbilt started as a 
 " Great Railroad Man " was won in his management of the 
 Hudson Eiver Raifroad. It was here that his transcendent 
 abilities flashed forth with dazzling lustre. He went into this 
 Road in 1864, but took no active part in it till he succeeded 
 Mr. Tobin as president, and to the chief dictation of its 
 affairs. To show what he accompHshed, we give fi'om the 
 reports made by the Company to the State Engineer the 
 results of the operation of this Company for four years end. 
 ing September 30th, 1867 : 
 
 1864. 
 
 1865. 
 
 1866. 
 
 1867. 
 
 Gross Earnings 
 
 Expenses 
 
 Net Earnings 
 
 Interest paid 
 
 Dividends 
 
 Rate of dividends per cent 
 
 $4,124,281 14,326,800 
 2,545,306 3,457,612 
 
 $4,829,562 
 3,696,218 
 
 $5,111,800 
 4,045,455 
 
 1,578,975 
 594,487 
 941,216 
 14 
 
 $968,188 
 537,613 
 329,405 
 
 ,131,352 
 
 515,918 
 
 615,427 
 
 9 
 
 $1,066,345 
 485,220 
 572,083 
 8 
 
 In all this there is certainly nothing very brilliant, although 
 very fair. But very soon the road began to show signs of want 
 
Dividends must be reduced or money provided from some 
 source other than net earnings. It was here that Mr. Van- 
 derbnt proved himself equal to the crisis. It was here that 
 he first entertained that masterly conception which must for- 
 ever stamp him as the "First Eailroad Man in the country" — 
 of doubling its capital stock, calling up, however, only 50 
 cents on the dollar ! Such issue would produce $3,500,000, 
 wherewith to bring up the road, and also to pay for St. John's 
 Park, the prospective value of which was to be far greater 
 than the 50 per cent, of bonus stock. Those who " went in" 
 at the right time were not slow in sounding the praises of 
 such a chieftain, who, by a single stroke of policy, and with- 
 out an additional dollar earned, could double the value of 
 their stock. The claqueurs of the press became more 
 vehement than ever. The public caught the strain and 
 became as frantic to get a little " Hudson" as ever a Cru- 
 sader was to get a fragment of the Holy Cross. Under the 
 furor the stock went to about 150 — ex the 50 per cent stock 
 dividend. Surely the like was never before seen or heard 
 of. Aladdin's lamp was completely snuffed out. The philoso- 
 pher's stone was at last found. Its possessor could not be 
 otherwise than famous and followed. " The Great EaHroad 
 Man" had at last come. 
 
 But he revolved still greater themes. If $3,500,000 
 could be, by his magic touch, created out of Hudson, 
 whose stock equaled only the paltry sum of $7,000,000, 
 what might not be done in New York Central, with a share 
 capital four times greater, or $28,000,000 ? But an uncon- 
 genial Board at that time held the direction of this road. 
 Tm the necessary change could be effected, Mr. Vanderbilt 
 iadulged himself and his friends m a modest but pleasant 
 entertaiament, out West. In the far-reaching visions of this 
 Eailroad Hercules, he spied in his track a small concern in 
 Ohio, which was gobbled up in short metre. The " extra 
 wool" on this little animal was judged to be worth 25 per 
 cent of the total amount ! The excess was promptly 
 stripped off and properly distributed. It was a small mat- 
 ter, but it elevated many degrees the reputation of Mr. Yan- 
 
derbilt as "the Great Railroad Man of the Age." There 
 were, however, a few ill-natured creatures who, we regi'et to 
 say, are found in aU communities, who did not hesitate to 
 say that this affair was really not very creditable to such a 
 railway expert. It happened that near by another party 
 had a sheep, fat to repletion, which they persuaded the great 
 Railroad Champion should be sheared at the same time, and 
 the aggregate product disposed of on joint account. The ex- 
 cess of wool on the one victim was rated at 25 per cent, and 
 upon the other at 75 per cent. ! It is claimed that in 
 equal scales both fleeces weighed the same. We do not 
 pretend to say that the Commodore was outgeneraled. If 
 he was, it is not much to be wondered at, for he had a 
 tough customer to deal with, equally familiar with himself 
 with raflroad management, but without enjoying his world- 
 wide reputation. " The still sow" — but the adage is stale. 
 Between the two the share capital of the line from Erie to 
 Toledo was increased from $10,000,000 to $15,000,000, 
 without a dollar going into the treasury of the Companies. 
 The Ohio party, in addition to the 75 per cent., were allowed 
 to make a trifling dividend of 10 per cent, cash, for their 
 own special edification. 
 
 We do not instance this case as calculating to add par- 
 ticularly to the lustre of the Commodore's reputation as the 
 "great Railroad Man of his time." It did, however, add 
 largely to it. We recited it for the purpose of pleasantly 
 whiling away the hours till "the wheels of time" should 
 remove the imbeciles and obstructionists that still, by virtue 
 of law, not of merit, held control of the Central. As the 
 great day of deliverance approached, a civic procession, com- 
 posed of the great shareholders in this Company, waited on 
 Mr. Vanderbilt and laid their shares and their homage at his 
 feet, entreating him that he would condescend to take pos- 
 session and control of their property. The spirit, if not the 
 language, of the suppliants was highly Oriental. "All that 
 you see is yours." Mr. Vanderbilt blandly replied that he 
 would accept the tendered honor and duty, and assured them 
 that he would manage their property as he would his own. 
 
6 
 
 In the mean time such wonderful doings could not be 
 had without exerting their due effect upon the public. The 
 arithmetic was simple. "A party bought 100 shares of 
 Hudson Eiver at par. He got 50 per cent, of bonus stock 
 in addition to 8 per cent, dividends, making the dividends 
 for the year .58 per cent. The stock dividend sells at 45 per 
 cent, premium. The man has doubled his money !" Central 
 was to repeat the magic. Everybody rushed into it, push- 
 ing it from the nineties up to 133, and Hudson Eiver, at the 
 same time, to the neighborhood of 150 ; for, according 
 to the programme, another fat cut was to be had out of this 
 road. The following extract from an article in the New 
 York Evening Post of February 25th, will show what this 
 programme, was or is : 
 
 " The figuies proposed for the valuation of these three lines (Hudson 
 Eiver, Harlem and Central), as they are intended to appear under one 
 management, show the following aggregates : 
 
 Present capital of the Central $28,537,000 
 
 Bonds convertible not yet converted ■ 453,000 
 
 Together $28,990,000 
 
 A scrip dividend of SSJ^ per cent 9,663,000 
 
 Enlarged capital $38,653,000 
 
 Bonds outstanding, January 1, 1868 11,347,000 
 
 Total revised value of road, &c $50,000,000 
 
 Present capital of the Hudson $14,000,000 
 
 Available for scrip dividend 6,000,000 
 
 Enlarged capital $20,000,000 
 
 Bonds outstanding January 1, 1868 5,000,000 
 
 Total revised value of road , &c $25,000,000 
 
 Present capital of Harlem $6,800,000 
 
 Available for scrip dividend 3,200,000 
 
 Enlarged capital $10,000,000 
 
 Bonds outstanding January ] , 1868 5,000,000 
 
 Total revised value of road, &o $15,000,000 
 
 Net income of the Hudson, $2,500,000 per annum, would give : 
 
 Ten per cent, on above capita] $2,000,000 
 
 Interest on bonds 350,000 
 
 And leave for contingencies 150,000 
 
 Total $2,500,000 
 
7 
 
 Net income of the Harlem, $1,500,000 per>iinum, would 'give : 
 
 Ten per cent, on capital $1,000,000 
 
 Interest on bonds 350,000 
 
 And leave for contingencies 150,000 
 
 Total $1,500,000 
 
 Estimated for New York Central : 
 
 Ten percent, on capital $3,865,000 
 
 Interest on sinking fands ] ,000,000 
 
 And leave'for contingencies 1,135,000 
 
 Total $6,000,000 
 
 The consolidation plan seems at present to be dominant. Nearly 
 the entire debt of the Central is on sii per cent, interest, but with 
 sinking funds attached to the principal loans or certificates of 1853, 
 $6,266,954, and of 1864, $2,925,000." 
 
 In this programme Mr. Vanderbilt's genius fairly eclipsed 
 itself. The Hudson Eiver coup de main netted first $3,500,000 ; 
 and by judicious manipulation, an equal sum by the advance 
 of the stock; or $7,000,000 in all. The stock in trade here 
 was an equal sum. The stock in trade in the three roads is 
 seven times gTeater ! The bonus dividend proposed was 
 $18,863,000, or nearly six times greater than that in Hudson 
 Eiver. If the new stock could be carried to 145, the price 
 at which Hudson Eiver sold after dividend, then the net 
 profits of the new transaction would be $27,351,350 ! And 
 why not? Can any limit be reasonably set to Mr. Yander- 
 bilt's cajDacity as a " Great Eailroad Man?" Evidently not 
 Anything is possible with the crowd that throng Broad 
 street. But the excitement must not be permitted to flag. 
 " The native hue of resolution " must not be allowed to be 
 " sicklied o'er with the pale cast of thought ;" if so, " enter- 
 prises of great pith and moment," etc., etc. — the reader will 
 finish the quotation. 
 
 A certain evidence of the greatness of the programme and 
 of its author is its entire harmony. The enormous increase of 
 stock is provided for by a still more prodigious increase of 
 earnings. Where the New York Central has struggled with 
 -desperation for years to pay 6 per cent, on $28,000,000, it is 
 to be made to pay 10 per cent, on $38,653,000, and to have 
 
8 
 
 a balance for contingencies of 1,135,000 ! a sum very nearly 
 equal to tlie dividends now paid ! This must sound to tlie 
 old managers of the Central like pardon after execution. 
 The Hudson is to pay an equally generous rate on $20,000,000, 
 after having, with great ado, contrived to pay 8 per cent, on 
 $6,900,000 ! After this, a pleasing sum of $150,000 is to 
 remain annually for the discharge of any little acts of cour- 
 tesy which its managers so well know how gracefully to 
 perform. The net earnings of the Harlem are to be $1,500,000, 
 (we shall not enlarge upon this road, as good breeding for- 
 bids interference with a man's private affairs). The total net 
 earnings to give consistency to the programme, consequently, 
 are to be $10,000,000, which will call for at least $40,000,000 
 gi'oss, a sum about twice as great as the present earnings of 
 the three lines. 
 
 How this increase, with a steadily declining traffic on all 
 the great trunk lines, is to be secured, the prograname does 
 not deign to tell. We do not know that it should go into 
 such insignificant matters. Mr. Vanderbilt's generous char- 
 acter and winning manners are perhaps relied upon. They 
 may do much to attract business ; but will the public pay 
 double price in consideration of such qualities ? We fear 
 this is too much to expect of poor, fallen humanity. If not, 
 is not the experience of the past hkely to be that of the 
 future ? What this experience has been, and is likely to be, 
 we shall by and by show. 
 
 «. To a mere looker-on, this whole Vanderbilt frenzy is 
 the broadest farce ever enacted upon this, or upon any 
 other stage. Its ludicrous side, for a time, throws all others, 
 into the shade. That a man for whom the most exalted qual- 
 ities are assumed without a shadow of reason, should, upon 
 the baldest fiction, be able to lash the whole market into the 
 wildest fary' — should be followed as the ten times Moses by 
 the speculating crowd — should be able to make his will law, 
 and upon the state of whose health the market wildly vi- 
 brates, and which, should he suddenly retire from this mortal 
 stage, would, we had almost said, go with him — exceeds be- 
 lief We had supposed that this gust of passion would, like 
 
9 
 
 all others, cure itself. It still rages, wiiether from con- 
 viction or because the subjects of it are in a position from 
 whicli they cannot extricate themselves, we propose presently 
 to inquire. 
 
 We have already given the earnings and dividends of/ 
 Hudson Eiver for the past four years. Its business was a 
 fair one, but not enough to keep up its dividends and make 
 the repairs and improvements necessary to keep the road in 
 good condition. Hence the Company were driven to an 
 issue of stock, by which $3,500,000 was raised, although the 
 capital of the Company was thereby increased $7,000,000. 
 That Mr. Vanderbilt ever added a dollar to the value of the 
 road, or to its business, by his experience, his management, or 
 his economies, is utterly preposterous. This is not his role. 
 He does not dedicate his life to the work of making' two 
 spears of grass gi-ow where only one grew before. The road 
 was far better managed and infinitely more popular befcJre 
 than since he came to it. It was in the hands of competent 
 and experienced railroad men. It would be to-day far more 
 valuable than it is if he had never got control of it. Its "un- 
 popularity under his regime is notorious, and every one 
 avoids it that can. 
 
 All know how Mr. Vanderbilt managed his steamboat 
 lines. Should he establish a line between New York and 
 Europe does any one believe that he could induce any pas- 
 sengers to go in it, except such as were willing to have 
 boors for companions and half rations for fare. He long ago 
 found competition on the free ocean no field for him. His*^ 
 must be one where there is no alternative but abject submis- 
 sion to his will. Such a monopoly he now holds in Hudson 
 River. He can there be oppressive and insolent with impu' 
 nity — at least till he drives the public into the construction 
 of new outlets, which is now fast being done. Imperialism 
 is not according to the genius of this country, and he who 
 attempts to play the despot is certain to find himself sud- 
 denly dethroned. 
 
 If Hudson Eiver had hard work to pay 8 per cent, divi- 
 dends, how has it been with the New York Central ? The 
 
10 
 
 answer to this is in the subjoined statement of the operations 
 of this road for four years past : 
 
 
 1864. 
 
 1865. 
 
 1866. 
 
 1867. 
 
 Capital stock 
 
 $24,836,000 
 13,263,909 
 
 $24,591,000 
 14,665,442 
 
 $25,801,000 
 14,095,804 
 
 $28,537,000 
 
 Funded & float'g debt- 
 
 12,069,820 
 
 Totals . . . 
 
 $38,096,909 
 
 12,997,889 
 9,431,143 
 
 $39,256,442 
 
 13,975,524 
 11,212,809 
 
 $39,896,804 
 
 14,596,785 
 11,335,673 
 
 $40,606,820 
 
 Earnings . 
 
 13,979,514 
 
 Expenses 
 
 10,764,045 
 
 
 
 
 $3,566,746 
 1,199,153 
 
 $2,762,715 
 1,170,200 
 
 $3,261,112 
 1,122,097 
 
 $3,215,469 
 
 Int.,Tents & sink'g fund 
 
 1,170,728 
 
 Dividend fund 
 
 Eate of dividend 
 
 Per centage of expenses 
 Do. of net earnings 
 
 $2,267,793 
 
 9p.c. 
 
 724 
 
 27i 
 
 $1,592,515 
 
 6p. c. 
 
 80 
 
 20 
 
 $2,139,015 
 
 6p. c. 
 
 77.6 
 
 22.4 
 
 $2,044,731 
 6p. c. 
 
 77 
 23 
 
 The dividends paid have not only fallen off from 
 9 to 6 per cent, but the capital of the Company has 
 increased in the mean time $2,509,911 for expenditures, 
 which should have come mainly from earnings. The 6 per 
 cent, dividends have been paid with great difficulty. The 
 truth is that the backbone of the Central was broken some 
 ten years ago by an operation which Mr. Yanderbilt is now 
 seeking to repeat. Ujoon the consolidation of this road a 
 honus or bogus dividend was made in the Company's bonds 
 to the amount of $10,000,000. The concern has been in a 
 sickly condition ever since. The actual cost of the road at 
 the present time is reported hj the Company at only 
 $36,594,000, of which $2,000,000 was added last year by 
 the purchase of the Athens Branch. The programme now 
 is to carry the capital account of the road up to $50,000,000, 
 without the addition of a dollar to its cost, or its capacity to 
 eanx Is the value of this properly likely to be improved by 
 this operation? 
 
 This railway is one in which the public is likely to be 
 greatly deceived as to its real value. It traverses, to be 
 sure, one of the finest districts in the country, filled with an 
 active and thrivihg population. But it is limited to two 
 cents per mile for passengers. It cost last year 1.890 cents 
 
11 
 
 to carry a passenger one mile ; in 1866, 1.899 ; in 1865, 
 1.875 ; in 1864, 1.542. The Company earned from passen- 
 gers the past year $4,032,023, and paid out as expenses for 
 their transportation $3,760,820 : the net was $271,203, or a 
 little less than 7 per cent, of the amount received. Every 
 pound of its freight, at the same time, is competed for, 
 most vigorously, for eight months in the year by the most 
 perfect artificial water-line in the world. There is no great 
 railroad in the United States that is obliged to contend 
 against such odds. If the $10,000,000 of bogus dividend, 
 made at the time of the consolidation, had never been made, 
 all would have been well The interest on this sum has 
 been equal to nearly 2^ per cent, on the share capital of the 
 Company. But for this, it could have maintained dividends 
 averaging 7 or perhaps 8 per cent. With it, 6 per cent, is 
 all it can do. With what sense, then, is a fui-ther addition 
 of some $9,000,000 still to be made to its stock, and witli- 
 out increasing, by one dollar, its capacity to earn ? 
 
 But the result of the operations of this road will by no 
 means compare unfavorably with those of other great trunk 
 lines. There is no better, nor more admirably managed, road 
 in the United States than the Pennsylvania Central. It has 
 the largest traffic, and coal, for fuel, is found upon almost 
 every portion of its route. The road is probably the most 
 perfectly constructed of any in this country. It wants 
 nothing that can give it completeness or efficiency. It has 
 no restriction upon charges, either upon freight or passen- 
 gers. Yet the expenses of this road average fully 75 per 
 cent, of its receipts, as will be shown in the following state- 
 ment : 
 
 
 1864. 
 
 1865. 
 
 1866. 
 
 1867. 
 
 Earnings 
 
 Expenses ..... .... .... 
 
 $14,759,058 
 10,693,944 
 
 $17,459,169 
 13,270,058 
 
 $16,583,883 
 12,790,909 
 
 |l6,340,156 
 12,080,300 
 
 
 
 Per centage of expen- 
 ses 
 
 $4,065,114 
 
 72.6 
 10 
 
 $4,189,111 
 
 76 
 10 
 
 $3,792,974 
 
 77.9 
 9 
 
 $4,259,856 
 74 
 
 Eate of dividend 
 
 6 
 
12 
 
 The Erie shows no better result, as will be seen by the 
 following statement for four years : 
 
 
 1864. 
 
 1865. 
 
 1866. 
 
 1867. 
 
 Earnings 
 
 $13,429,643 
 9,630,688 
 
 $16,462,227 
 12,570,325 
 
 $14,596,413 
 11,529,605 
 
 $14,317,213 
 10,674,355 
 
 Expenses 
 
 
 
 Ratio of expenses to 
 enrningB 
 
 13,798,955 
 72.50 
 
 $3,891,902 
 76.03 
 
 $3,066,808 
 79 
 
 $3,642,858 
 74.55 
 
 
 
 What, then, can be more preposterous and iniquitous than 
 to attempt to impose upon roads, already staggering under 
 excessive loads, this Vanderbilt programme? The Central 
 cannot take a dollar more of dead weight, and continue its 6 
 per cent, dividends. The idea that the earnings of this road 
 can be increased is absurd ; upon all the great trunk lines 
 traffic is steadily declining. It has nominally a considerable 
 sum on its books to the credit of income account, but not a 
 dollar to show for it in its treasury. The whole went into 
 the road long ago for its maintenance, and should have been 
 embraced in current expenses. 
 
 J The whole programme, therefore, is a delusion and a snare. 
 The authors of it are either dishonest or fools. There is 
 no middle ground here. All the roads embraced in 
 it want money, instead of having any to divide in 
 the shape of plunder. In the face of all this, will the bogus 
 issues, if made, be taken by the public to accommodate the 
 ring, at the fabulous prices of Hudson Eiver ? 
 
 But suppose Vanderbilt Imperialism to triumph — the 
 programme to be carried outr— the nominal capital of the 
 three roads to be carried to $90,000,000, and that the lines 
 be made to earn $10,000,000 net on this sum— what then ? 
 A tax has been levied upon the commerce of the country by 
 a self-constituted, unscrupulous and remorseless power, equal 
 to some ^8,000,000, gross, annually, for its own especial ben- 
 efit, without the equivalent of a penny ! Is it wise for the pub- 
 lic to tolerate — much less encourage — such lawless tyranny, 
 which seeks to eat up their substance, and even subvert the 
 very ends of society? The great subject to which universal 
 
13 
 
 attention is turned, and wliich is of chief interest to all, are 
 metliods to cheapen the cost of transportation, so as to allow 
 all the products of the far distant interior to reach our city 
 at a reasonable rate. Cost of transportation always embraces 
 interest on the nominal sum invested in the works used for 
 that purpose. The problem set to the manager of a railway 
 is to make it pay interest and dividends on its capital. The 
 needless addition of every dollar to such capital is a perpetual 
 tax upon the community, and those whose lives are spent ia 
 devisiag plans by which, for their own private ends, they 
 can increase the amount levied without any addition of real 
 capital of the works, are the 'pests of society, and should be 
 objects of execration instead of adulation, whether found 
 in Hudson Eiver, in New York Central, in Cleveland and 
 Toledo, or ia Chicago and Northwestern. 
 
 But the schemes of Mr. Vanderbilt and his party are 
 vain without possession of the Erie. The tariff of charges ne- 
 cessary to make the Hudson Eiver, Harlem and Central pay 
 upon their enlarged capital, can never be levied with a com- 
 peting road beyond their control. Hence the desperate ef- 
 forts now made to grasp it. The public are sufficiently in- 
 formed as to the efforts made by the Vanderbilt party on 
 the one side and the Drew party on the other. We do not 
 propose to discuss the merits of the contest, as far as they 
 have any personal bearing ; but only as they relate to the 
 welfare of New York. We know that it is not for the in- 
 terest of this city that all the great avenues entering it should 
 be under the control of one man, or of one set of men. 
 We trust, therefore, that the Drew party will be able to 
 maiatain Brie as an independent line. This is all really that 
 the public care for. Such a result secured, Drew and Van- 
 derbilt may fight out their battles to their hearts' content 
 
 The public have a deep stake, moreover, in this question, / 
 as a matter of precedent or example. Shall a set of men, 
 from the accident of wealth, be permitted to roam lawlessly 
 about the country, hunting up railways to ravish and destroy ? 
 It is from such men that this great interest is in imminent 
 danger of being entirely wrecked It never was in such 
 
14 
 
 peril as at this very moment. The public sentiment has 
 been completely debauched by paper money. All relation 
 between prices and values has been lost sight of. Impunity 
 is thus secured to almost any act, no matter how injurious 
 or base. We protest earnestly against all such schemes 
 as are proposed by the Yanderbilt ring, as destructive not 
 only of all moral sense, but as utterly ruinous to the great 
 interest upon which all others hang for support. 
 
 We do not wonder that the Commodore and his party 
 should feel chagrined at the position of affairs. They made 
 " a good thing " out of Hudson River — just about the amount 
 alleged to be wanting to put the Brie in tip-top order. The 
 Erie Company proposed to raise this sum by the indirect 
 sale of $10,000,000 of its stock. In their eagerness to get 
 control, the Vanderbilt party took this with the other stock. 
 Grrasping at some $16,000,000, they were accommodated 
 with $34,000,000. Drew quietly puts the proceeds of the 
 new stock into his pocket, and moves over to Jersey City for 
 the purpose of administering upon its expenditure. So far 
 all the advantages of this Hudson River speculation have been 
 turned to the account of a hated ^ rival. There is a sort of 
 poetic justice in all this. The joke is too good not to raise 
 a smile on the cheek of the chief victim. It is the best 
 thing of the kind that it has been our good fortune to meet. 
 We do not know of any parties who can better spare the 
 amount wanted. They ought to be thankful that it is going 
 for so good an object. We trust Mr. Drew will see it well 
 and faithfully expended. Perhaps he would consent to the 
 appointment, by the Vanderbilt party, of an agent to act 
 with the Erie Company, in seeing that the money is well 
 laid out. This would be a comity which all great men 
 should not be slow to extend toward each other. 
 
 It is objected that the Erie party should not have raised 
 the money required by an issue of stock. But this objection 
 comes with ill grace by the Vanderbilt party, which has only 
 just set a notable precedent in Hudson River. The latter 
 propose to put into this road only one-half of the nominal 
 value of the stock issued. The Erie party propose to put 
 
15 
 
 in 72-J per cent., or the whole amount received. So far, tlie 
 latter have a decided advantage. They do not, as we under- 
 stand, propose to put any portion of it into their own pockets. 
 
 We can see, on the whole, no mode so just, equitable 
 and advantageous to the Erie Company of providing for its 
 wants as the one adopted. The parties furnishing the money 
 had just made it in a good speculation, and had the cash in 
 hand. Their good fortune carried a certain obligation. So 
 far so good. 
 
 The object of a borrower should be to have his loan so 
 made that he will never be called upon to pay either princi- 
 pal or interest. The Erie Company appear to have perfectly 
 accomplished this end. Its shares, like British consols, are 
 never due. As for interest in the shape of dividends, this 
 is what no one expected or expects. The holders of Erie 
 stock .do not want a dividend. Were one regularly paid, 
 the stock would in a great measure lose its value as an 
 instrument of speculation. All parties therefore, are, or 
 ought to be, perfectly satisfied. As for the Erie, it is cer- 
 tainly a wonderful stroke of good fortune to be able to raise 
 $7,250,000 for construction and repairs upon its road, with- 
 out incurring an obligation for a dollar. Not to avail them- 
 selves of such an opportunity would show that the directors 
 were utterly unfit for their place. We may remark, too, 
 that should the Vanderbilt party ultimately come into the 
 possession of the road, they will find their money again in 
 works upon the line, judiciously expended, we trust ; and, 
 what is more, without care or anxiety on their part — a, cause 
 for gratitude, certainly. 
 
 WhUe upon this subject, it may be well to inquire into 
 
 the condition of Erie, to show the magnitude of the stake for 
 
 which the parties are contending. Its capital account is 
 
 made up as follows : 
 
 Stock, common |34,263,300 
 
 Stock, preferred 8,536,910 
 
 Bonded debt 22,429,962 
 
 Floating debt OTer and above the Drew debt 2,000,000 
 
 Capital of leased Unes, on -wMcli 7 per cent, per annnm is 
 
 paid 10,395,550 
 
 $77,625,652 
 
16 
 
 The Company hav6 the proceeds of the recent sale of 
 stock, but all these are to be expended, immediately, upon 
 the road, and will not reduce the capital account. To carry 
 such a load as this would seem, to most men, a pretty heavy 
 burden ; but it is said that Mr. VanderbiLt can put the whole 
 of it into his own pocket "without winking." If he takes 
 the whole common stock, he takes it subject to a prior 
 incumbrance equal to $43,362,382, a sum greater by 
 $3,000,000 than the nominal capital of New York Central, 
 and some $7,000,000 greater than its cost. The Erie is a 
 ^^hig thing," hut the war and paper money have made us 
 familiar with big things. With all its immense cost, Mr. 
 Vanderbilt, we understand, affirms positively that "it can 
 be made to pay." 
 
 If Mr. Vanderbilt and his party control Erie, carry out 
 their programme on Hudson Eiver, Harlem and JSTeW York 
 Central, then they will wield a property of the nominal value 
 of $167,000,000 ! ISTero wished that Eome had but one head, 
 that he might cut it off at a blow. As far as power over 
 this city would be concerned, the Vanderbilt party wiU be 
 pretty nearly where the Eoman Emperor wished himself to be. 
 We shall exist by their favor and grace. But we trust m 
 better things. This party are reaching after impossibilities. 
 The power they have gathered, and may stm gather, they 
 canuot hold. It will elude their grasp m a manner that they 
 could neither foresee nor prevent. But somebody is yet to 
 pay the penalty for such a gross violation not only of good 
 morals but of good sense. The misfortune is, that the col- 
 lapse, when it comes, wUl bury in its ruins hundreds of 
 deluded followers, as well as the contrivers of this stupen- 
 dous folly and wrong.