THE RAILROAD AND ITS PRESIDENT
SUPERVISION OF THE CLASSIFIED ACTIVITIES--ENGINEERING, OPERATING,
MAINTENANCE OF WAY, ETC.--THE DIVISIONAL SYSTEM AS FOLLOWED IN THE
PENNSYLVANIA ROAD--THE DEPARTMENTAL PLAN AS FOLLOWED IN THE NEW YORK
CENTRAL--NEED FOR VICE-PRESIDENTS--THE BOARD OF DIRECTORS--HARRIMAN A
MODEL PRESIDENT--HOW THE PENNSYLVANIA FORCED ITSELF INTO NEW YORK
CITY--ACTION OF A PRESIDENT TO SAVE THE LIFE OF A LABORER'S
CHILD--"KEEP RIGHT ON OBEYING ORDERS"--SOME RAILROAD PRESIDENTS
COMPARED--HIGH SALARIES OF PRESIDENTS.
All the widely divergent lines of human activity in the organization of
the railroad converge in the office of its president. He is the focal
point of the entire system. More than that, he is its head and front. If
he is anything less, the sooner he is out of his job the better for both
the railroad and himself; for, although there is a great variety of
departments in the organization of steam railroad transportation and each
department will have still greater varieties of activities, there is but a
single activity delegated to the office that bears only the modest word
"president" in gilt letters upon its door. The function of that office is
to supervise. To understand that supervision better, consider for a moment
the rough structure of the railroad.
Its activities are grouped into classes. The activity of soliciting
business, both freight and passenger, forms the traffic department, in
many ways the most important of all; for from it comes nearly all the vast
revenue needed for the maintenance of the organism. The legal department
looks after the railroad's rights--its franchises, its charters, the law
fabric of its almost innumerable relations with the various railroad
commissions, legislatures, city councils, and town and country boards. If
the road be really sizable--with 8,000 or 10,000 or 12,000 miles of
track--it will probably organize into separate departments the buying of
its great quantities of supplies, the keeping of its intricate books, and
the handling of its money. The business of building its lines and
structures will need special talent for an engineering department. The
department that will employ the great rank and file of the railroad's army
of employees is the operating department, called by some big roads the
transportation department.
There are two other great factors of conducting a railroad; maintaining
its lines--the tracks, bridges, tunnels and other features of the
permanent way; and keeping both cars and engines fit for service. This
last work, organized as the mechanical department, will probably rank next
to operating in the number of its employees, and the value of its
equipment is one of the greatest assets of the railroad. It is generally
expressed in great shops located here and there and everywhere, at
convenient points upon the system.
Generally the maintenance-of-way department comes under operating--it is
only fair that a general manager should supervise the condition of the
line over which he is expected to operate his trains at high speed and in
absolute safety. The same argument should hold true as to the equipment.
But right here is the great rock upon which the principle of American
railroad organization splits in twain.
From the president's office downward, the system of organization may be
divisional or departmental. In the former case, the division
superintendent is the real unit of railroad operation: under his guidance
and responsibility come not only the operation of the trains but the
maintenance both of the line and of the rolling-stock. In the case of
departmental organization that superintendent--and also, above him, the
general superintendent--exercises no authority over the engineers of
maintenance-of-way or the master mechanics of the shops along the system.
Those lines of railroad activity do not converge with that of train
operation below the office of the general manager. The greatest outside
power that is given to a division superintendent on a purely departmental
road is a sort of coöperation with the master mechanic in the matter of
the men who handle the road's motive power. This coöperation is many times
intricate and involved. If the master mechanic and the division
superintendent are not harmoniously inclined toward one another, and
things very naturally go wrong with the motive-power, it is a difficult
matter to locate responsibility.
* * * * *
The Pennsylvania system, which is one of the most perfectly organized in
the world, is strongly organized upon the divisional system. The division
superintendent upon the Pennsylvania is indeed a prince above his
principality, and he is well trained for his rulership. Pennsylvania men
go through the mill. It takes a pretty capable man to combine the ability
for handling trains and handling men with the intricate knowledge for
command over an engineering corps devoted to maintenance-of-way, as well
as command over a machine-shop which may employ a thousand skilled
workmen. In order to give its division heads that tremendous training, the
Pennsylvania sends its men through its own West Point, the great shops at
Altoona. The men who have sat in the big, roomy office in Broad Street
Station, Philadelphia, and who have been addressed as president, have been
proud of the days when they were up in the hills of the Keystone State,
standing their trick in overalls at the lathe, or carrying chain and rod
over long stretches of track. To-day every Pennsylvania superintendent,
possibly with a single exception or two, is a civil or mechanical
engineer.
[Illustration: THE OLD AND THE NEW ON THE GREAT NORTHERN--THE "WILLIAM
CROOKS," THE FIRST ENGINE OF THE HILL SYSTEM, AND ONE OF THE NEWEST
MALLETS]
[Illustration: THE SOUTHERN PACIFIC FINDS DIRECT ENTRANCE INTO SAN
FRANCISCO FOR ONE OF ITS BRANCH LINES BY TUNNELS PIERCING THE HEART OF THE
SUBURBS]
[Illustration: PORTAL OF THE ABANDONED TUNNEL OF THE ALLEGHANY PORTAGE
RAILROAD NEAR JOHNSTOWN, PA., THE FIRST RAILROAD TUNNEL IN THE UNITED
STATES]
On the other hand, the New York Central has also been brought into a
high state of organization, and stands firmly on the departmental plan.
"We believe that our superintendents should specialize in train
operation," says one of the high officers of that road. "In other words,
we do not believe that a man, to get his traffic through over a stretch of
line, should necessarily know to a fraction of an inch the best wheel-base
for an engine of a given type or the precise construction of a truss
bridge. Such requirements take away from the special training that is
to-day needed for every high-class railroader. A railroader is made better
by sticking to one thing and sticking to it faithfully; and our
departmental method, by which the maintenance of line and rolling-stock
comes under the sole supervision of men expert in those specialties, we
think the best. Sometimes we develop a very wizard in traffic handling,
who has never had a chance at a technical education."
And there you have the very essence of the other side of the proposition.
Between these two sides there are various shadings and gradings, but the
question has never been definitely solved. It has reduced the vast
complexity in the organization of the modern railroad of the larger size.
That has become so very complex it fairly cried for expert relief. One man
has recently spent a busy term of years in simplifying the organization of
the Harriman lines. To cut the intricate lines of red-tape in a big
railroad office, to reduce to a minimum the vast needless correspondence
between departments and between branches of a single department, is a
problem that calls for genius--and offers for its solution no small
reward.
* * * * *
In other days--and we refer to no ancient history, for the electric light
was proved and the hundred-ton locomotive already increasing the average
tonnage of the American freight train--the presidents of the biggest roads
were content to worry along with one or two assistants. But two decades
ago, the railroads were still simple matters; there did not exist the
intimate relations between one and the others of them, as shown by
stockholdings in competing and feeding lines to-day--the constant waiting
of their executives upon the sessions of the different railroad
commissions. These complications of American railroading have also further
complicated the organizations of the different systems, and have brought a
demand for executives of the keenest type. It is no slight strain that a
man works under when he becomes the head of a ten-thousand-mile railroad.
So to-day the president of the railroad has fortified himself in the only
possible way--by creating vice-presidencies. Each ranking department
to-day is apt to be recognized in council by a vice-president; and these
heads form a cabinet as informal as that of the Federal Government and, in
its way, quite as important. Legal traffic, and engineering traffic each
demands a vice-president at that cabinet-board, and gets him. The general
manager usually is the vice-president representing operation. One big road
has eight vice-presidents. It is indeed a poor property that cannot show
three or four men that are the fittest to hold this title.
There is another cabinet where the president must sit, which is formal and
recognized; it is the board of directors. Between it and the lesser
cabinet the president must take good care that he is not ground as between
millstones. The cabinet of his department heads will tell him how he can
spend his money; but he must get it from the upper cabinet. It is not
always harmonious pulling in the upper cabinet. Imagine for a moment the
troubles that sometimes arise in the lower.
You are sitting in the office of a big railroad president, talking
straight to that big-shouldered soul himself. Outside is the shadowy roof
of the train-shed of a terminal, which is filled with long lines of cars
that come and go, of platforms that are black with humans one instant and
quite deserted the next. The room has the quiet elegance of a comfortable
home library. There are long rows of books upon the shelves; a great table
is set squarely in the centre. But it is business--for a ticker is slowly
spelling the fate of that railroad and every other railroad, upon the
endless tape; a huge map of the system--many thousands of miles of
high-class railroad--lies under the glass that covers the table top.
"They don't always pull together," the president of the railroad admits,
when you ask him about the lower cabinet. "Sometimes they pull apart when
they have honestly different ideas as to policy, and other times--there's
to be a big college football game up at G---- next Saturday. We have only
two private cars for our four vice-presidents, every single blessed one of
whom wants to go. I don't want to go myself, and I've contributed my car,
but we're one short then, and the man that's left is going around like a
boy who's had a chip knocked off his shoulder. He's just been in here, and
I've settled the matter by hiring a car for his party from the Pullman
folks and footing the bill myself. I sent him out ashamed of himself.
"That's Pete every time. Flares up quick, and every time he flares up I
can remember when we were working the day-and-night tricks in a
God-forsaken junction out on a prairie stretch of the Great West. He's
like a boy in some ways--awfully fussy about the rights and prerogatives
of his department; and he'll go all to pieces over some little thing if he
thinks another man has stepped over on to his side of the line. But let a
big situation arise--a flood that sets a whole division of our lines
awash; a wicked congestion of traffic in midwinter blizzards; a nasty
accident that takes away our nerve--and you ought to see Pete! He'll be
handling the thing as if he were putting a ball up on the links, and he'll
never lose his confident smile. That man in one such emergency is worth
the hire of a dozen Pullmans."
You ask about the upper cabinet, and the president lowers his voice. The
board is no matter for light conversation. He steps to the window and
points down into the concourse of the train-shed.
"I happen to know that young fellow over there by the mailbox," he
answers. "He's one of our travelling freight-agents. He's lucky. He works
for one boss, and is responsible to him; I work for a whole regiment of
bosses, and am held responsible by a group of pretty keen old citizens who
gather around this table and put me on the rack.
"There are many interests in this property, and some of them are too big
to sleep in the same bed. I have three directors who never speak to one
another outside of this room, and rarely ever in it. There is another who
represents the holdings of a road that fights this at every turn, and he
hurts the property worse than any good husky plague. A big estate, with a
bitter aversion to spending money for any purpose whatsoever, has another
director here; and a banking interest presents a director who seconds him
in every move, fool or good. That is the crowd I have got to work with
when I want ten or fifteen millions to hold our own against some other
fellow who is crowding us hard for business in our competitive territory
or threatening to run a line into one of our own private melon-patches.
That boy down there is lucky. He has only got to get out and land a couple
of hundred carloads from a shipper who hates corporations worse than
politics, and who has just had a claim for spoiled goods turned down by
this particular corporation. That boy has the cinch job."
* * * * *
This imaginary railroad president has told you of one of the vital points
in the business of the railroad, the necessity for constant teamwork. A
railroad head may have the genius of a Napoleon, the stubborn persistence
of a Grant, or the marvellous executive ability of a Pierpont Morgan, and
be worthless if his board is not working enthusiastically with and for
him. It is not all pie and preserves by any means. The board may set its
sweet will straight against his, and he may be forced to execute a policy
of which in his own mind he has no trust. It is only once in a generation
that a man like Harriman, who can bend a whole mighty directorate to his
absolute will, arises. Harriman was a railroad president in the fullest
sense of the word.
He rode in his car north from Ogden one day, toward the great National
Park of the Yellowstone. At that time the only direct rail entrance to
that splendid reserve was by the rival Hill lines. Harriman had called for
a report upon the opportunities for the Southern Pacific to strike its own
line into the west edge of the Park. That report was being explained to
him in great detail as he rode north from Ogden. His chiefs had a hundred
practical reasons against building the line. Harriman listened faithfully
to the explanation, as was his way. Then he turned to one of the signers
of the report, a high officer of his property.
"You have never been in the Yellowstone?" he asked.
The officer admitted that he had not.
"I have," said Harriman triumphantly, "and I am going to build that road."
That road was built and became successful from its beginning; but Harriman
was a railroader with the intuitive sense that gives genius to a great
statesman or to a great general. The average railroad president does not
hold a controlling interest himself and he must be guided pretty carefully
by the judgment of his department heads; he must win the coöperation of
his board by tact and subtlety rather than by the display of an iron will;
and where he leads he must take the responsibility.
The Pennsylvania Railroad, as has already been told in an earlier chapter,
recently forced its entrance into New York City and marked its terminal
there with a monumental station. That move was a strategy of the highest
order, and was made that the road might place itself upon an even fighting
basis for traffic with its chief competitor. But it cost. Two mighty
rivers had to be crossed, whole blocks of high-priced real estate secured,
a busy city threaded, the opposition of local authorities (who stood with
palms outstretched) honestly downed. That all cost. That would have been a
mighty expenditure for the Federal Government; for a private corporation
it was all but staggering.
When the station was finished, a rarely beautiful thing with its classic
public rooms, its long vistas, and its vast dimensions, that private
corporation built, within a niche of the great waiting-room, a bronze
figure of its former president, the late A. J. Cassatt, where all hurrying
humanity might see it. But, though a thousand nervous travellers see that
statue in the passing of a single hour, not a hundred of them will know
the splendid tragedy it represents; for many of the high officers of that
railroad--some of the men who caused the bronze to be erected--to this day
believe that the production of that great station was the cause of the
death of their chief. He had dreamed of that terminal for years; his
engineer had deemed it all but impossible, and he had sent overseas for
other engineers. One of these, who had conquered the busy Thames, said
that he could tunnel the two great rivers. He was asked the cost, and he
gave it. His first figures were staggering, but the railroad president did
not abandon his hope. He summoned his board and put the problem to them.
There was pulling power between that president and his board, and the
pulling was all in a single direction. Their system--a railroad that
acknowledged no superior--could not keep in the very front rank without
its terminal in the heart of the seaboard city, eliminating forever the
delays and the inconveniences of a ferry service; the road could not
afford to drop into second rank, and so it assumed the great undertaking.
That meant many things more than laymen understand; the selling of
securities in delicate markets, home and foreign, which fluctuate wildly
on the promulgation of anticorporation talk; the evading of untiring
competitors; the appeasing of hungry politicians, only too anxious to feed
at the hands of a wealthy corporation. In this case, it meant more than
all these things, for the two rivers were quite as treacherous as the
American engineers had pronounced them. They would sound in their tunnel
bearings and find rock which seemed soft, and their dynamite charges would
be sufficient. Then it would prove hard, and their blast as inefficient as
that of a child's toy cannon. Again, the rock would drill as hard as the
hardest gneiss--the very backbone of Mother Earth herself, and the
hard-rock men would prepare a heavy charge of dynamite. Then the stuff was
as soft as gravel, and their heavy charge would have torn off the roofs of
half a dozen houses. When they were under one of the rivers they found its
bed--the roof of their tunnel--as soft as mud. There came a day when the
little foaming swirls of water above their headings became a geyser: the
river-bed had blown entirely out.
After that, some of the younger engineers felt like throwing themselves
into the wicked river, but the biggest engineer of all never lost his
faith. He sent upstream and brought down a whole Spanish Armada of clumsy
scows, each heaped high with sticky clay. That clay--in thousands of cubic
yards--made a new river-bottom and the tunnel shields went forward.
There were other obstacles and discouragements, almost an infinite array
of them, to be surmounted, but this railroad president had steeled his
mind to the accomplishment of that terminal. In the making of it he gave
his life. When the day came for the drafts upon the railroad's treasury,
mounting higher and higher, he was cheer; when bad news came from the
burrowing engineers, he was courage; when timid stockholders and directors
began to worry, he was comfort. He gave of his vitality to the
organization, to the making of the terminal, until the day came when he
gave too much--and his life went out while he was still like a mighty king
in battle. He did not live to see the classic lines of the great station
building. As he stands in the waiting-room, he stands in bronze. Those
bronze eyes are powerless to see the splendid fruition of his endeavors.
That sort of thing--heroic courage and death-bringing devotion to an
enterprise--repeats itself now and then among the executives of the
railroads. When the panic of 1907 reached high tide, there was a certain
railroad president who, like his fellows, viewed it with no little alarm.
He had lunched with a big steel man, the kind the newspapers like to call
a magnate, and the steel man had scared him. The company for which the
former labored was going to close half a dozen of its plants--was going to
throw some thousands of poorly provided men out of work.
The railroad president took that bad news back to his comfortable office;
at night it travelled with him in his automobile to his big and showy
house. It would hit his company hard in its heavy tonnage district, but
that was only a single phase of the situation. He thought of things
becoming more disjointed when the news became public--before that week had
run its course. That night the president made up his mind to take a big
step. It was risky business, but he thought it worth the risk.
He sent for the steel man in the morning and asked him what was the best
price he could make for his product. The steel man cut his regular profit
in half, but the president was not satisfied.
"You'll have to show me a better margin than that," he said.
"We'll eliminate profits," said the steel man, "and give you the stuff at
cost, to save shutting down our plant."
"Is that the best you can do?" persisted the president.
Before he was done, the steel man had also eliminated depreciation on
plants and half a dozen minor expenses. He agreed to deliver at the mere
cost of raw material and labor. Then he received an order that would have
broken some records in prosperous times. The road was committed to some
big building projects and it needed whole trainloads of girders and
columns; bridges by the dozen. The railroad president went further, and
helped out the steel man's car-building plant. He ordered 3,000 steel
freight cars, and every day he was getting reports from his general
manager of a further falling of traffic tides. They had motive-power
rusting on sidings, and they were dumping freight cars in the ditches
along the right-of-way because they did not have storage-room for them.
That took courage of a certain high-grade sort. When those freshly-painted
new steel cars began to be delivered in daily batches of sixty, some of
his directors asked him where he was going to find room to store them. He
did not answer, for he did not know; but in the long run he won out. His
company had a new equipment for the returning flood-tide of traffic which
had cost it 25 per cent less than that of its competitors. When the time
came to build its big improvement it had the steel all stored and ready.
The president was able to tell his directors then that he had saved them
$1,700,000 on that close bargain that he had driven in panicky times.
* * * * *
Sometimes a little thing makes a railroad president big.
The head of a busy road in the Middle West was hurrying to Chicago one day
to attend a mighty important conference of railroad chiefs. His special
was halted at a division point for an engine-change, and the president was
enjoying a three-minute breathing spell walking up and down beside his
car. An Italian track laborer tried to make his way to him. The
president's secretary, who was on the job, after the manner of presidents'
secretaries, stopped the man. The signal was given that the train was
ready, but the president saw that the track-hand was crying. He ordered
his train held and went over to him. The story was quickly told. The
track-hand's little boy had been playing in the yards and had hidden in an
open box-car; so his small companions had reported. Afterwards the car had
been closed and sealed by a yardmaster's employee. Somewhere it was
bumping its weary way in a lazy freight train, while a small boy, hungry
and scared, was vainly calling to be let out.
Perhaps that president had a boy of the same size--they always do in
stories; and perhaps--this being reality--he did not. But he stopped there
for three precious hours, at that busy division point, while he sent
orders broadcast to find the boy, orders that went with big authority
because they came from the high boss himself. He was late at the
conference, because that search was taking his mind and his attention. He
hung for hours at a long-distance telephone, personally directing the
boy-hunt with his marvellously fertile and resourceful mind. When action
came entirely too slowly he ordered the men out of the shops and all
interchange freight halted, until every one of 12,000 or 14,000 box cars
had been opened and searched. Finally, from one of these they drew forth
the limp and almost lifeless body of a small boy.
The railroad chief died a little while ago and was buried in a city 500
miles away from the line that he had controlled. The track-hands of his
line, with that delicate sensibility that is part and parcel of the
Italian, dug deep into their scanty savings and hired a special train,
that they might march in a body at his funeral.
It sometimes takes a big man to do a little thing in a big way.
* * * * *
Here is Underwood, the railroad president who took hold of the Erie when
the property was a byword and a joke, who began pouring money into it to
give it real improvements and possibilities for economical handling, and
made it a practical and a profitable freighter, a freighter of no mean
importance at that. He once issued an order that any car on the road (no
matter of what class of equipment) with a flat wheel should be immediately
cut out of the train. The order was posted in every yardmaster's office up
and down that system.
Some time after it went into effect, Underwood was hurrying east in his
private car. It was essential that he should reach Jersey City in the
early morning, for he had a big day's grist awaiting him at his office. A
real railroad president, working 18 hours a day, can brook few delays. But
when the president awoke, his car was not in motion; the foot of his bunk
was higher than the head. He looked out and found himself in a railroad
yard three or four hundred miles from his office. When he got up and out
he saw why his bed had been aslant. The observation end of his car was
jacked up and the car-repairers were slipping a new pair of wheels
underneath it. A car-tinker bossed the job and Underwood addressed him.
"Who gave you authority to cut out my car?" he asked.
"If you will walk over to my coop," said the car-tinker, politely, "you
will find my authority in orders from headquarters to cut out any car (no
matter of what class of equipment) with a flat wheel."
When the new wheels were in place the president of the road put his hand
upon the shoulder of the car-tinker and marched him uptown. The man
obeyed, not knowing what was coming to him. Underwood walked him straight
into a jeweller's shop, picked out the best gold watch in the case and
handed it to the car-tinker.
"You keep right on obeying orders," he said.
The relations between a railroad president at the head of the
organization, and some man who struggles ahead in the army of which the
president is general, would make a whole book. They still tell a story in
Broad Street Station, Philadelphia, of Mr. Cassatt, the Pennsylvania's
great president, and the brakeman.
It seems that one of the suburban locals that took Cassatt to his country
home up the main line was halted one night by an unfriendly signal. The
president, mildly wondering at the delay, found his way to the rear
platform. On the lower step of that platform, in plain violation of the
company's rule, sat the rear brakeman. Cassatt was never a man who was
quick with words, but he said in a low voice:
"Young man, isn't there a rule on this road that a brakeman shall go a
certain distance to the rear of a stalled train to protect it by danger
signal?"
The brakeman spat upon the right-of-way and, without lifting his eyes from
it, said:
"If there is, it's none of your damn business."
Cassatt--the man who could strike an arm of Pennsylvania into the heart of
metropolitan New York at a cost of many millions of dollars--was much
embarrassed.
"Oh, certainly it isn't," he said with an attempt at a smile. "I was
merely asking for information."
The next morning the president of the Pennsylvania summoned the
trainmaster of that suburban division to his desk and reported the matter.
The trainmaster turned three colors. It was _lèse-majesté_ of the most
heinous sort. He proposed the immediate dismissal of the offending
brakeman. Cassatt ruled against that. He was too big a man to be seeking
to rob any brakeman of his job.
"Just tell him," he said to the trainmaster, with a suggestion of a smile
about his lips, "that he cussed the president, and that, as a personal
favor, I should like him to be more polite to passengers in the future."
No two railroad presidents come up to their problem in quite the same way.
Take the two members of the Western railroad world--one gone now--Hill and
Harriman. In J. J. Hill's domain the personality of the man counts for
everything. He picks his men, advances them, rejects or dismisses them,
by a rare intuitive sense, with which he judges character. A high chief in
his ranks once asked for a vacation in which to take his family to Europe.
Hill granted it. When the man came back from Europe another was at his
desk. Hill did not approve of long vacations, and that was his method of
showing it. The department head should have known better.
On the other hand, Harriman measured his men impersonally--as if in a
master scale. He measured them by results. A man might personally be
somewhat repugnant to him, but if he accomplished results for the road, he
held his place, at least until some one came along who could do even
better.
W. C. Brown, of the New York Central, and James McCrea, of the
Pennsylvania, are the heads of two railroads great in mileage and in
volume of traffic; yet their methods are in many essentials radically
different. McCrea is the essence of Pennsylvania policy--coldly
impersonal. It is easier to gain an audience with the president of the
United States than with the president of the Pennsylvania. No Pennsylvania
man from president down to the lowest ranking officer, grants an interview
to a newspaper reporter. It would be risky business for any officer of the
Pennsylvania to have his photograph published or himself glorified by
reason of his connection with the company. The company is the corporation.
When it speaks, it speaks impersonally through its press agent, a clever
young man with clever assistants, who both answers newspaper questions and
advances newspaper information. His function is a new one of the American
railroad, and allies itself directly with the office of the president.
W. C. Brown, of the New York Central, probably stands preëminent to-day
among American railroad executives. He has shouldered himself up from the
ranks of the railroad army, and only good wishes have gone to him as he
has stepped from one high post to a still higher one. He has come, as
nine out of ten successful executives have come, from the operating end of
the railroad.
Brown is particularly accessible to newspaper reporters. He talks with
them, carefully and painstakingly, and sees to it that they are correctly
informed as to each of the great railroad problems of the day. He believes
sincerely that the head of a railroad should be personality and that the
personality should stand forth directly in the guidance of the property.
In his own case, at least, he has demonstrated the value of his theory.
For all this work and all this strain, the railroad president demands that
he be adequately paid. He has a good many perquisites--chief among them a
comfortable private car at his beck and call; but perquisites are not
salary. The head and front of the American railroad to-day receives
anywhere from $15,000 to $75,000; an astonishingly large percentage of
railroad presidents are receiving at least $50,000 annually. But they work
for their pay--sometimes with their life-devotion, as in the case of the
big man who built the big terminal; other times with the hard sense of the
president who bought his steel girders and cars in the time of panic. Here
is a case in point.
A road in the Middle West, which was so compact as to make it quite local
in character, had a big traffic proposition to handle and was handling it
in a miserable fashion. One local celebrity after another tackled it,
until the directors were laying side bets with one another as to the
precise day when the receiver should walk into the office. Finally,
Eastern capital, which was heavily interested in the property, revolted at
the local offerings, and sent out an operating man with a big reputation
to take hold of it.
The directors received him with a certain veiled distrust as coming from
another land, but in the end they hired him. The matter of salary came up
last of all.
"Fifty thousand," said the New Yorker in a low voice.
One of the local directors spoke up.
"Fifteen thousand!" said he. "It's out of the question. We've never paid
more than twelve."
"So I should imagine," was the dry response. "But I said fifty, not
fifteen."
The consternation that followed may be imagined! In the end the New Yorker
carried his point. At the end of just twelve months he had, through his
acquaintance in Wall Street, and his keen insight into the big channels of
finance, cut that little road's interest charges just $800,000 a year. The
receiver has not come yet. The road has accomplished a miracle and has
begun to pay dividends. There is another miracle to relate. Last spring,
the directors of the road voted an increase in salary to their
president--and he courteously refused it!
"I think the presidency of this road is worth $50,000 a year," he said,
frankly, "and not one cent more."
That is the way a president should stand above and with his board.
Only a little time ago, another president, who had no easier proposition
to set upon its feet, was criticised by a querulous old director for his
lavish use of private cars and special trains. That president was having
his own troubles--his job had no soft places; but he said nothing when the
testy old fellow lectured him as he might have lectured a sin-filled
schoolboy. When the director was done, the president spoke in a low voice.
"Gentlemen, my resignation is on the table," was his reply to the censure.
The next moment there was consternation in that board. The president
slipped out of the room and left them to consider the matter. When he
returned, the chairman of the board, who had nodded in half approval at
the censure, was at the door to greet him.
"We refuse to accept your resignation," he said; "but the board does feel
that you ought to have a new car--the present one's getting shabby, Phil."
And in that moment the president felt that his work had gained one little
ounce of appreciation.