For the first time in the history of railroading a program 
 bringing together all the complex elements which go to make 
 up the railroad situation was arranged tinder the auspices 
 of the Evansville ( Indiana ) Chamber of Commerce, to take 
 place in that city on December 14 and 15. Railroad presi- 
 dents, leaders of railway labor unions, members of com- 
 missions which regulate the railroads, counsels for railroads, 
 shippers and representatives of the great army of investors 
 in railroad stocks and bonds were present. 
 
 Among those on the program to make formal addresses 
 were Alfred P. Thom, Counsel of the Railway Executives 
 Advisory Committee on Federal Legislation; Mr. Frank 
 Trumbull, Chairman of the Railroad Executives Advisory 
 Committee ; Frank P. Walsh, Chairman of the Federal 
 Commission on Industrial Relations; Clifford Thorne, Chair- 
 man of the Board of the Railway Commissioners of Iowa; 
 IV. G. Lee, President of the Brotherhood of Railway 
 Trainmen. 
 
Any discussion on the subject of rail and water trans- 
 portation or any sound analysis of the present condition 
 of American transportation cannot be complete, cannot 
 secure effective remedies without the participation of the 
 real owners of the railroads — the investors. 
 
 Quietly, but with a steadiness which has accomplished 
 marvelous results, there has been going on, for the past 
 ten years, with cumulative force, the persistent absorp- 
 tion of railway stocks and bonds of the leading railway 
 systems of the country by the man of moderate means, 
 the small investor. 
 
 Starting with the 1907 panic, known in Wall Street as 
 the “Rich Man’s Panic,” there has been a steady and 
 rapid increase in the individual number and amount of 
 securities held. The result has been that, whereas in 
 1901 many leading railroads were owned by a few hun- 
 dred or at most thousands of investors, now men (and 
 women too) with moderate amounts of money who were 
 impressed with the opportunity to secure liberal and per- 
 manent income are the chief owners. Coincident with 
 the opportunity, there developed, among financial 
 houses, firms specializing in service to the small investor, 
 firms which studied his needs, catered to his wants, se- 
 lected with care the security desired, whether a single 
 share of stock or a single hundred dollar bond. And what 
 is now the result? Listen to this short array of official 
 figures as to number of Stockholders given out by the 
 larger railroad systems: 
 
 Atchison 1901, 1,300 today, 45,000 
 
 Pennsylvania 1901, 27,000 today, 94,000 
 
 C., M. & St. P 1901, 5,000 today, 17,000 
 
 Gt. Northern 1901, 1,700 today, 25,000 
 
 Baltimore & Ohio 1901, 3,200 today, 27,000 
 
 Southern Pacific 1901, 1,500 today, 33,000 
 
 and so on down the list. 
 
 The New Wall Street 
 
 And let me state right here a word for Wall Street. I 
 have a right to say it, because, first, I am a railroad man 
 of extensive western traffic experience, and, second, be- 
 cause today and for the past twenty years, I have had 
 practical experience in Wall Street with the hydra-headed 
 and hard-headed small investor. Wall Street has changed 
 very much during the past ten years. Many houses now 
 have thousands of customers, where houses doing a larger 
 business have only hundreds. This is due to the immense 
 detail, the careful painstaking work required, to meet the 
 needs of the small investor. Wall Street is no longer a 
 
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gambler’s paradise. It is a section of hard work, devoted 
 to research to obtain facts and information to guide the 
 thrifty, how and what to buy. It is to Wall Street earnest 
 minded people come with their savings to buy in small 
 quantities securities representing the best lines of trans- 
 portation in the country. 
 
 During this period of increasing popular participation 
 in investment, I have been actively interested in the 
 work and I know whereof I speak, but my experience pre- 
 viously was distinctly in the railroad field. I think I can 
 present evidence entitling me to membership among the 
 railroad men who helped build up the middle and far 
 West. 
 
 Some Past Experience 
 
 I am presenting this evidence in order to anticipate the 
 objection which we are all likely to cite when another 
 factor intrudes in a discussion which we have come to 
 consider limited to a certain class of debaters. So please 
 absolve me of any charge of egotism when I say that 
 forty years ago I was general freight agent of the Kansas 
 Pacific Railway, the only trunk line of Kansas running 
 from the Missouri River to the Rocky Mountains. I saw 
 Kansas emerge from her scourging by grasshoppers and 
 drought to a state of continuous rich crops and plenty. 
 Thence I went to the great Northwest Pacific coast, 
 where existed a complicated transportation system of 
 river, rail, ocean and sound. I transformed the measure- 
 ment basis of transportation charge to that of weight. 
 The rate on a horse, fQr instance, was reached by meas- 
 uring from the tip of his nose to the end of his tail (we 
 didn’t allow for cropped tails) and charged on the basis 
 of 40 cubic feet per ton of space occupied. On the com- 
 pletion of the Northern Pacific R. R., I became traffic 
 manager of the new transcontinental line, which revolu- 
 tionized the making of through rates to the Pacific coast. 
 All of that great development I saw; part of it I was. 
 Later, thirty years ago, I became traffic manager of the 
 Chesapeake & Ohio R. R., now so ably represented by 
 our friend, Mr. Frank Trumbull. 
 
 In the recent history of railroading and in the present 
 discussion on railway development, the great army of 
 investors in railway securities have not taken a prom- 
 inent part. They have taken hardly any part, but on the 
 basis of a practical railroad experience and on the basis of 
 a practical investment experience, I believe it is in ap- 
 proaching present problems from the standpoint of the 
 investor that we are most likely to reach a proper solution. 
 
 Throughout the country, there is a great army of in- 
 vestors ready to supply money for the railroad develop- 
 
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ment which the country so badly needs. If these 
 investors can be convinced that capital invested in the 
 railroads will be given proper consideration in the solving 
 of all problems, that most pressing problem, the raising 
 of the great amount of money needed for new construc- 
 tion and development, can be easily solved. 
 
 Now let me get down to the present status of this 
 matter. 
 
 The Present Conflict 
 
 There is at present a conflict raging between two 
 elements in the railroad transportation business. 
 
 On one side, are the directors and executives of the 
 railroads. On the other side, are the four brotherhoods 
 of engineers, firemen, conductors and trainmen. The 
 brotherhoods, 400,000 strong, united and alert, say with 
 one voice, “We must have more pay or shorter hours 
 or both or we’ll strike.” The executives answer, “With our 
 restricted rates and higher cost of operation, we cannot 
 grant your request.” A deadlock occurs, the matter is 
 appealed to the President and he, to avert a calamity, 
 promises to grant, through Congress, what the roads deny. 
 
 The investors, 600,000 strong, the real owners of the 
 properties, scattered all over this country, having an 
 immense power vested in them, unorganized, are unable 
 to come forward with the combined voice of even a paltry 
 dozen. They are uneasy. They chafe. They hesitate. 
 They ask the question, “How about future investments 
 in railroads torn by dissension between executives and 
 employes?” 
 
 They finally evolve this thought: The executives of 
 the road represent us and, in the main, do it satisfactorily; 
 but, owing to the fact that there is a prejudice against 
 them in Congress, in the Commissions, and in the mind 
 of the public, they can’t, in their official capacity, exert 
 as much influence in certain fields as we could if we should 
 act for ourselves independently. Let us get together 
 and let us, the owners of the roads, show to Congress 
 and the Commissions that political influence and voting 
 power are not wholly confined to shippers and the four 
 brotherhoods. 
 
 The investors, in addition to thinking in this manner 
 as to the attitude existing between their railroad execu- 
 tives and the brotherhoods, evolve another thought, as 
 follows: 
 
 We are the real owners of the railroads. It is our money 
 which is invested, therefore, you, the brotherhoods, are 
 our employes. Now what is the matter? We are 600,000 
 strong; you are 400,000 strong. You are organized; we 
 
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are not. You have put one over on us, because you are 
 organized, but it is unfair. It won’t stand the test. Let 
 us talk over our grievances. You have yours. We 
 have ours. We can’t pay what you demand unless we 
 are helped. Instead of snarling and quarreling with your 
 executives, let us together find the solution of the matter 
 and, when we get what we ought to have (and we ask you 
 to help us get it), you may be sure that we in turn will 
 allow you what you must see under this high cost of 
 operation we cannot grant. 
 
 At Cross Purposes 
 
 Now, gentlemen, you must see, in the present condition 
 of this conflict between the railroads and their employes, 
 that they are working at cross purposes. 
 
 The great army of railroad brotherhoods have been 
 forehanded. Upon small contributions from their wages 
 and with skilful and astute leadership, they have built 
 up a power and force which have enabled them to go 
 before the highest authority in the land and demand and 
 obtain a promise of increased pay upon threat, if not 
 granted, of closing up the traffic of the country. 
 
 These 400,000 employes of 600,000 investment owners, 
 of our $20,000,000,000 national transportation system, 
 did this. How did they get away with it? Was it because 
 their numerical strength made them politically formidable? 
 Is this big free country to be coerced by such tactics? 
 
 And right here, is it not logical to ask if the brother- 
 hoods can by this threat obtain higher wages why can 
 they not by similar threat more simply solve this problem 
 and obtain for their employers, the railroads, higher rates 
 to enable them to pay higher wages? 
 
 “It is well to have a giant’s strength, but it is tyrannous 
 to use it as a giant.” 
 
 Now I submit that the brotherhoods, in taking the 
 course which they did, committed a great mistake. If an 
 employe of mine comes into my office with pistol in hand 
 and says to me, “Mr. Muir, I want you to raise my pay. 
 If you don’t, I will blow your head off,” I tell him at 
 once to clear out. But if he comes to me and says, “You 
 are making money. My pay is not enough under this 
 increased cost of living. Will you not raise it?” I 
 immediately reason with him and devise ways and means 
 to satisfy him. 
 
 This course of the brotherhoods will not stand the 
 test. The railroads, under present conditions, can- 
 not stand for the demand of the brotherhoods and 
 continue successful operation. If the brotherhoods 
 
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had used the same influence and force with the same 
 authority in Washington in presenting the needs of the 
 railroads and gained for their employers what they think 
 they have secured for themselves, the railroads would 
 to-day be able to meet their demands. 
 
 The Real Owners 
 
 And where in this controversy stand the 600,000 rail- 
 way investors, who embody the great force that lies 
 latent in the owners of the railroad property? Nobody 
 ever hears a peep from them, and Congress and the 
 Commissions simply ignore them as if they were a negligible 
 quantity. That is not the way to carry on an effective 
 campaign. Why shouldn’t they appear by means of 
 their own chosen representatives, before the Newlands 
 Commission or whatever body may finally be appointed 
 to crystalize conclusions on, this all-important problem? 
 Why shouldn’t they, as an organized and politically 
 formidable body, bring their influence to bear on the press 
 and on the public? Of course, their representatives 
 in the persons of presidents, legal counsel, etc., appear 
 and speak for them, but we all know very well that 
 isn’t the same thing, because the public prejudice is 
 against the managers of the railroads, not against the 
 stockholders who own them. It is of supreme importance 
 that the owners should be satisfied, because it is they 
 who furnish the funds to develop the sections of country 
 not now properly supplied with transportation facilities. 
 It is the owners that Congress and the Commissions 
 ought to hear from, and the owners are as dumb as oysters 
 and as powerless as jellyfish with no solidarity or means 
 of expression. 
 
 And now The Saturday Evening Post says, “In the face 
 of a billion net last year, railroad managers and investors 
 in railroad securities are wondering what the situation will 
 be after the boom, if public regulation of railroads is 
 applied in as narrow and jealous a spirit as it was for some 
 years before the war. Individual shippers may applaud 
 when a particular rate they are interested in is cut down. 
 Farmers here and there may be fooled into thinking that 
 the lowest possible freight rate which does not throw the 
 carriers into actual bankruptcy is to their interest. But 
 it is very certain that, for the country at large, regulation 
 in that haggling oppressive spirit does not pay.” 
 
 I quote from the Bible when I say, “Beware of the 
 withholding which leadeth to poverty.” 
 
 You have no doubt seen that the present condition 
 of the railroads has been likened to a man suffering from 
 hardening of the arteries. This is a striking simile, but 
 I cannot fully subscribe to it. Hardening of the arteries 
 
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means age, decay and approaching dissolution. This is 
 not the case with this country. We are young, vigorous 
 and have plenty of rich virgin sections yet to open and 
 cultivate. But we are hampered and hemmed in by the 
 wants of this growing nation. We need blood to pulsate 
 through these arteries. The thousands and tens of 
 thousands of small investors stand ready_ to furnish the 
 means to inject blood in the shape of rails, ties, rolling 
 stock, terminal facilities, to develop these new fields. But 
 they hesitate and fight shy of new propositions where, by 
 the lesson of last summer, they see that their employes’ 
 demands are satisfied and taken out of the earnings of 
 the railroads by the Government and their own right's 
 for proper compensation are ignored. 
 
 Purpose of the League 
 
 Now, the Railway Investors’ League has been organized 
 to consolidate, for protective action, that immense power 
 and influence possessed, but heretofore unused, by hun- 
 dreds of thousands of unorganized investors. _ 
 
 The League is neither anti-labor nor political. Its aim 
 is to secure fair play alike from railroad managers, rail- 
 road workers, railroad regulatory bodies and political 
 parties. It will oppose unfair tactics, whether attempted . 
 by federal or state government bodies, by railroad manage- 
 ments or railroad employes. It is “anti” nothing save un- 
 just practices from above or below, from without or within. 
 
 This is The Railway Investors’ League which is now 
 growing like a young giant and to which we want every 
 man or woman who owns one share of stock or one 
 thousand, one hundred dollar bond or thousands, to belong 
 and to support this immense power for fair play -fair play 
 for owners and employes, for shippers, for the public 
 and for the country. 
 
 Mr. Paul Mack Whelan, the secretary of the League, is 
 here. He will furnish the platform of the League, and, 
 if you are in sympathy and accord with its object and 
 purpose, enroll yourself now. More especially do I in- 
 vite co-operation and enrollment from the members of the 
 brotherhoods. There is not one idea or sentiment in The 
 Railway Investors’ League incompatible with the brother- 
 hoods’ desire to obtain fair play from their corporations 
 and for their corporations. Instead of being 400,000 and 
 600,000, let us make it a million, combined to assert, 
 maintain and defend our rights. 
 
 Brothers of the brotherhoods, are you with us? If so, 
 come forward now and act jointly with us. 
 
 JOHN MUIR, Chairman, 
 
 Railway Investors’ League. 
 
 December 14, 1916. 
 
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