Business: Mr. Lee and the General

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President Roosevelt made railway men feel good three weeks ago when he said that the last thing he wanted to do was to take over their railroads. Then he said that the best thing for the railroads right now is a little judicious consolidation. Last week Burton K. Wheeler's dogged Senate Interstate Commerce Committee turned up an episode involving the late President Coolidge, the late Ivy Lee and the late General W. W. Atterbury which showed that the course of consolidation does not run smoothly.

Simmering in the Interstate Commerce Commission between 1921 and 1929 was a proposal to consolidate all the railroads in the East into four systems—Pennsylvania, the Van Sweringen group, New York Central, Baltimore & Ohio. In 1927 this seemed good to President Coolidge and he sent a message to Congress saying so. In the files of General Atterbury, then president of the Pennsylvania, inquisitive Burton Wheeler came across a confidential letter from the Pennsylvania's pressagent, Ivy Lee (who gained fame as the press-agent of John D. Rockefeller). Ivy Lee's letter to the General reported the text of President Coolidge's message eight days before it was delivered. This fact seemed suspicious last week to Burton Wheeler, Pennsylvania Vice President A. J. County thought not.

Mr. County: Mr. Lee was a newspaper man and I understand he often supplied the press with information to be held for release on a specified date.

Mr. Wheeler: But Mr. Lee was not a newspaper man when he wrote General Atterbury. . . .

Mr. County: He had been a newspaper man.

That afternoon Burton Wheeler gave his attention to one of the many perplexing difficulties the consolidators met with. The Lehigh Valley Railroad Co. was to be given to the New York Central; the Wabash Railway Co., to the B. & O. In 1928 the Pennsylvania Railroad Co., through its subsidiary the Pennsylvania Co., bought large blocks of the stock of both. The Interstate Commerce Commission thought that this was a violation of the Clayton Anti-Trust Act but unfortunately for the supporters of the original four-system proposal the Circuit Court of Appeals overruled the I. C. C. decision. Cost of the purchase was $106,000,000. At present the stock is worth almost precisely $100,000,000 less. Said Pennsylvania's County under questioning, "No loss is sustained unless a sale is made."