I understand that this audience is composed largely of employes of the Burlington Railroad Company, and I am glad that that is so, and what I shall say will be addressed particularly to them.
So much has been said and written about railroads during the last two years, and by many well qualified to do both, as well as by some not qualified to do either, that it can hardly be possible that any new thing remains to be said, and I fear I shall only be able this evening to repeat to you collectively the same things I have already said to many of you individually.
Under the Burlington plan of organization the Second Vice-President has direct charge of the operation of the line (responsible, of course, to the President), and for the last five years I have had the privilege and honor of holding that office. I refer to this only that I may by so doing establish my relationship with the various matters to which I shall later specifically refer, because I propose to confine my remarks chiefly to home matters; that is to say, to matters pertaining directly to the Burlington Company. I feel that I ought to be qualified to speak clearly on that subject, and while I have naturally read much concerning the general railroad question as a whole, the same sources of information have also been open to you, I have no doubt many of you have given the general subject as much or even more study than I have.
In October, 1907—16 months ago—the Burlington Company did the largest business in its entire history—ran the most trains, earned the most money and employed the most men. During that month the names of 53,000 men appeared upon its pay-rolls; and the same condition existed quite generally throughout the entire United States. There was a well-nigh universal complaint of car shortage and lack of motive power.
Four months later, reports from the Car Efficiency Bureau in Chicago showed a surplus of over 325,000 freight cars on the American railroads. In the meantime the Burlington Company had reduced its force by nearly 18,000 men and it was estimated that the transportation business of the country had fallen off more than 30 per cent.
What caused this unprecedented change? Men far abler than I have undertaken to explain, and many reasons have been given, all, I presume, more or less in harmony with the facts, but influenced no doubt by each man's point of view. I say, candidly, I do not know what caused it; that is, assuming that there was any one cause, but I think I can point out to you some of the contributing causes, at least so far as the Burlington Company is concerned.
A railroad, as you all well know, is a living, growing thing. It is never finished, or if we think we have finished some certain part, as was probably thought when the original stone engine houses were built here some years ago, or when the first bridge was built across the Mississippi River at Burlington, it always happens that heavier, larger, and longer engines come along in course of time, forced upon us by the changed conditions, and our engine house which was built for all time becomes too short, and our bridge is too light, and both must be rebuilt. The same thing is going on in every department of railroad operations—ballast, ties, rails, coaches, station buildings, even grades and curvature, all come within the changing influence of time and progress. I referred to the engine house specifically simply to illustrate my point.
Because of the constant change or evolution which is going on, it is necessary that Railroad Companies, if they expect to keep abreast of the times, should make annually large expenditures for such improvements as from time to time become desirable or necessary, if the standard of service is to be raised, or even maintained. These are called extraordinary expenditures, and it is customary on this Line to prepare each year, as of January 1st, what is called a Budget, being in effect a list of the more important improvements considered necessary by the officers of the Road. The Budget shows the separate items, with description of each, and also estimated cost. It may and does include such items as new cars or engines needed, additional sidetracks, new terminal yards, such as you have here, water treating plants, new coal chutes, etc.
On January 1, 1907, the sum total of the Burlington Budget, as it stood approved by the President on that date, amounted to something over $16,000,000.00. It included some new equipment and also some quite large improvements, such as new yard at Lincoln, grade reductions between Galesburg and Savanna, etc.
The Burlington System is over 9,000 miles in length, and goes through parts of eleven different states. On the 1st of January, 1907, the legislatures in all of the eleven states, I think, were in session. The Federal Congress was also in session at Washington. Bills having special reference to railroads were being introduced daily in some of the legislative bodies above mentioned. I cannot say now that all of them were against the railroads, but I feel I am justified in saying that while perhaps some of them if passed might not have injured the railroads much, none, or at most very few, were intended to help the roads. In fact, the attitude of the Federal Congress as well as of most of the state legislatures was considered by nearly all railroad owners, and officers as well, as distinctly hostile. This belief may or may not have been justified by the facts—at any rate it existed. The owners of the Burlington Company believed it. Its executive officers believed it. I believed it.