ERRONEOUS ESTIMATE OF THE VALUE OF THE WESTERN UNION TELEGRAPH COMPANY’S PROPERTY.
Mr. Washburne says:—
“The statement furnished by the officers of the telegraph companies, for the information of the Postmaster-General, and by him forwarded to Congress as his reply to the call for information, is well calculated to remove all doubts as to the value of this kind of property. Among other items of information is the following:—
“The length of wire owned by the Western Union and United States companies is 60,000 miles.[[13]] The average cost, as based on the now united capital, is $450 per mile. This embraces, besides the poles, wires, and apparatus, the following:—
[13]. This estimate was made before the consolidation of the American Telegraph Company and other properties with the Western Union Telegraph Company, and when its capital was only $27,000,000.
| Invested in buildings, | $95,208.83 |
| Stocks in other companies, | 1,429,900.00 |
| Office fittings, | 360,000.00 |
“It is remarkable that while the length of wire is given, the length of line nowhere appears.[[14]] There is a vast difference between the cost of a telegraph line and a telegraphic wire. We have seen the cost of a line with a single wire estimated at $61.80, and each additional wire placed on the same posts, $31.80 per mile.
[14]. We have given the length of the lines, as well as the length of the wires belonging to the Western Union Telegraph Company, on page [32].
“In the absence of any exact information on the subject, we may fairly estimate that the lines of the companies named average three wires to each line. They possess, then, 20,000 miles of telegraph line, with an average of three wires thereon. They speak of ‘single wire lines costing $180 per mile.’ This estimate is too high for any line now in use; but if it be adopted as the basis of calculation, and an allowance of $45 per mile be made for each additional wire, we have, for the 20,000 miles of line owned by the companies named, a cost of $5,400,000, represented by a capital stock of $41,000,000! ‘The average cost’ per mile of each wire suspended on their lines, ‘as based on the now united capital, is $450 per mile.’ If ‘the united capital’ had been based upon the actual cost of the property of the company, it would have been nearer $4,000,000 than $41,000,000.
“The ‘information’ furnished to the Postmaster-General is compiled with the evident intent to discourage the experiment then contemplated. It is incomplete, and is compiled with an intent to mislead. To any one who will take the trouble to examine it carefully, and to apply the proper tests to its assertions, it furnishes additional arguments in favor of a careful experiment by the government in the construction and maintenance of telegraph lines under control of the Post-Office Department.”