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to use iron rails, at an ordinary rate of interest upon capital, until the cost of producing steel is reduced to its minimum. When this result is accomplished, the general public will be materially benefited by the reduced cost of transportation which the introduction of steel rails will enable railway companies to afford."

The following statement exhibits the earnings of the Company for a series of years:

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The "Philadelphia News" of May 9, 1867, says:"In accordance with the policy adopted by the Pennsylvania Railroad Company, the Board of Directors have declared a semi-annual cash dividend of three per cent. on the capital stock, and an extra dividend of five per cent., which will be paid to the stockholders in the shares of the Company, both clear of National and State tax. The extra dividend is derived from earnings of the road prior to January 1, and it is quite probable that the surplus earnings

* Including Philadelphia and Erie Railroad.

above six per cent. for the current year, will enable the Board to declare a like extra dividend in November."

The officers of the Company are as follows:

President, J. Edgar Thomson; Vice-Presidents, Thomas A. Scott, and H. J. Lombaert; Treasurer, Thos. T. Firth; Secretary, Edmund Smith.

We have thus endeavored to present a sketch of the history, operations, and prospects of this great road, which is justly regarded with pride by every citizen of Pennsylvania. The amazing success which has attended all the operations of the Company, and the bright prospects that lie before it in the future, are almost entirely due to the good sense on the part of the Directors, in re-electing and keeping in office Mr. Thomson and Mr. Scott, the chief officers of the Company. The occasions have been frequent, particularly during the last few years, when the rare executive and administrative qualities of these gentlemen not only saved the Company from heavy losses, but brought about results that are now seen in the enviable position which the road and the Company occupy.

The Pennsylvania Railroad Company has recently purchased the Pan-Handle, or Steubenville Railroad, extending from Pittsburg to Newark in Ohio; so that the Company's cars can now run on its own road, from Philadelphia nearly to the Capital of Ohio. The western operations of the Company will be greatly facilitated by this purchase; as it now has the virtual control of an uninterrupted line from Philadelphia to Cincinnati.

CHAPTER XI.

PITTSBURG, FORT WAYNE, AND CHICAGO RAILROAD.

THIS great road affords an excellent example of the benefits of railroad consolidation; of the good effects of which we shall meet with so many examples in the progress of this work.

The distance between Philadelphia and Chicago is eight hundred and twenty-three miles. Previous to the year 1856, there was no direct railroad communication between these two cities. The through line is now composed of two roads, namely, the Pennsylvania Central from Philadelphia to Pittsburg; and the Pittsburg, Fort Wayne, and Chicago, from Pittsburg to Chicago. The construction of the latter road was formally commenced by breaking ground at the boundary line between the States of Pennsylvania and Ohio, on the 4th of July, 1849, the work having been commenced by the Ohio and Pennsylvania Railroad Company, of which Gen. Wm. Robinson, Jr., was the first and then President, and S. W. Roberts, Esq., the Chief Engineer. The Ohio and Pennsylvania Railroad Company was incorporated by an Act of the Legislature of Ohio, passed 24th of February, 1848; and the Legislature of Pennsylvania, by an Act of the 11th of April of the same year, concurrently made the Company a corporation of Pennsylvania. The Act

of Incorporation gave the Company "power to construct a railroad from the town of Mansfield, in Richland County, eastward by the way of the towns of Wooster, Massillon, and Canton, to some point in the eastern boundary of Ohio, within the county of Columbiana, as hereinafter provided; thence to the city of Pittsburg, in the State of Pennsylvania; and from the said town of Mansfield westwardly by way of Bucyrus, in Crawford County, until it intersects the west line of the State of Ohio." Under this authority the preliminary surveys for the road were commenced in Pennsylvania, on the bank of the Ohio River, at the mouth of Big Beaver River, on the 11th of July, 1848. The surveys were pressed forward with much energy, and completed for the whole line in less than two years. The work of construction was commenced in the last half of 1849, and the entire track was laid and the road opened for use between Pittsburg (Alleghany City) and Crestline, a distance of one hundred and eighty seven miles, on the 11th of April, 1853. Although the Company was authorized to extend its road to the western boundary of the State of Ohio, the Board of Directors did, as early as 1850, make Crestline the western terminus of the road. This action was taken in view of the certainty that the line would be practically carried to the western boundary of Ohio by the building of the Ohio and Indiana Railroad in the direction of Fort Wayne, and the building of the Bellefontaine and Indiana Railroad in the direction of Indianapolis.

The means for building the Ohio and Pennsylvania road were derived from the sale of shares, bonds, and

temporary loans. A large proportion of the shares was subscribed for by municipal and other corporations, and not paid for in cash, but in the bonds of the corporations subscribing. These had to be sold at a discount by the Railroad Company, and the loss sustained by it, thereby adding to the cost of the road. The shares subscribed for by individuals were paid for in cash, or by contractors' work, the latter being to the Company as good as cash, so far as the work was contracted for at cash rates. The actual cash, however, paid into the treasury of the Company by shareholders was only about one-fifth of the cost of the road and equipment.

The great desire to have pushed forward to early completion a continuous railway from Pittsburg to Chicago induced parties the most interested to organize new companies, believing their object could be reached more speedily by several corporations than by one. In furtherance of this view, the Legislature of Ohio, on the 20th of March, 1850, passed an Act incorporating the Ohio and Indiana Railroad Company, with "power to construct a railroad commencing at a suitable point, to be selected by said Company, on the Cleveland, Columbus, and Cincinnati Railroad, near Seltzer's tavern, in the county of Richland; thence to Bucyrus, in the county of Crawford; thence to Upper Sandusky, in the county of Wyandotte, and thence, on such route as the Directors of said Company, or a majority of them may select, to the west line of the State of Ohio; and thence to Fort Wayne, in the State of Indiana." This Company was made a corporation of Indiana by concurrent legislation of that State with

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