Fifth System

The prospective merging of railroad systems from Chicago to the Atlantic seaboard was already a complicated affair last winter. But it had apparently simmered down to the question as to just which small roads should be swallowed up by the four big systems--N. Y. Central, Pennsylvania, Nickel Plate, Baltimore & Ohio. The little roads have seemingly got rather tired of being taken as canaries for somebody's else cats. Accordingly, President Loree of the Delaware & Hudson announced plans, a few weeks ago, for a fifth Eastern system to include most of the small roads over whose disposition the four large systems were quarreling (TIME. Apr. 27).

Mr. Loree has long been recognized as a big president of a small road. He is not a theorist merely, but also a man of action. Swiftly he followed suit to the leasing of the Virginian by the Norfolk & Western (subsidiary of the Pennsylvania) (TIME, May 4) by leasing the very desirable Buffalo, Rochester & Pittsburgh R. R. for the D. & H. The lease will run for 999 years at a rental sufficient to pay a 6% dividend on the B. R. & P.'s $6,000,000 of preferred and $10,500,000 common stock. The leased line taps rich soft coal fields, and in turn leases several smaller carriers, such as the Allegheny & Western, Allegheny Terminal, Clearfield & Mahoning and the Mahoning Valley.

The "big four" have been busily engaged in watching the Nickel Plate proceedings in Washington, and meanwhile the mice have been playing. Mr. Loree's next move in effecting his proposed "fifth system" will be carefully watched.