operties for years and had collected large annual dividends from
them. Naturally they had no desire to sell, yet their acquisition was
essential to the monopoly which the Whitney-Ryan syndicate aspired to
construct. They finally leased all these roads, under agreements which
guaranteed large annual rentals. In practically all these cases the
Metropolitan, in order to secure physical possession, agreed to pay
rentals that far exceeded the earning capacity of the road. What is the
explanation of such insane finance? We do not have the precise facts in
the matter of the New York railways; but similar operations in Chicago,
which have been officially made public, shed the utmost light upon
the situation. In order to get possession of a single road in Chicago,
Widener and Elkins guaranteed a thirty-five per cent dividend; to get
one Philadelphia line, they guaranteed 65 1/2 per cent on capital
paid in. This, of course, was not business; the motives actuating
the syndicate were purely speculative. In Chicago, Widener and Elkins
quietly made large purchases of the stock in these roads before they
leased them to the parent company. The exceedingly profitable lease
naturally gave such stocks a high value, in case they preferred to sell;
if they held them, they reaped huge rewards from the leases which they
had themselves decreed. Perhaps their most remarkable exploit was
the lease of the West Division Railway Company of Chicago to the West
Chicago Street Railroad. Widener and Elkins controlled the West Division
Railway; their partner, Charles T. Yerkes, controlled the latter
corporation. The negotiation of a lease, therefore, was a purely
informal matter; the partners were merely dealing with one another; yet
Widener and Elkins received a fee of $5,000,000 as personal compensation
for negotiating this lease!

But this whole leasing system, both in New York and Chicago, entailed
scandals perhaps even more reprehensible. All these leased properties,
when taken over, were horse-car lines, and their transformation into
electrically propelled systems involved reconstruction operations on an
extensive scale. It seems perfectly clear that the chief motive
which inspired these extravagant leases was the determination of the
individuals who made up the syndicate to obtain physical possession and
to make huge profits on construction. The "construction accounts" of the
Metropolitan in New York form the most mysterious and incredible chapter