the events
were generally similar to those already recounted--stock-market corners,
over-issues of bonds and stocks, injunctions, court orders, arrests,
legislative bribes. Less than a week after his election Jay Gould
frankly announced that the company had just issued $10,000,000 of
convertible bonds and that a third of these had already been converted
into stock. He further announced that the company now had $60,000,000 of
common stock outstanding, whereas the public had understood that it was
only $45,000,000.

During the few years that followed, the poor Erie was systematically
looted. Millions were wasted in New York real-estate speculation, and
the company's money was used in the erection of the Grand Opera House on
Twenty-third Street, to which the executive offices of the Erie Railroad
were moved. Finally the new ring, comprising as leading spirits Jay
Gould and James Fisk, Jr., eliminated Daniel Drew and left him high and
dry without a cent, through a new stock corner. About this time the road
was financially on its last legs, and Jay Gould was appointed receiver.
This started further litigation which dragged on for several years
until, in 1874, Gould was turned out by General Daniel E. Sickles in
combination with the English shareholders. The new interests, when they
finally got control, elected an entirely new management and made H. J.
Jewett, a practical railroad man, president. But the Erie was already
bankrupt, and not much could be done toward saving the situation. In
May, 1875, the road confessed inability to meet its obligations, and
Jewett was appointed receiver.

It was three years from the date of the receivership before the Erie
property was taken out of the hands of the courts. In April, 1878, a
new company, the New York, Lake Erie and Western Railroad, took over
the property; Jewett was elected its president, and a new chapter in the
history of the property began.

Had the reorganization of the Erie been drastic enough, the road might
not so soon have fallen into financial difficulties again, for it owned
valuable coal lands in Eastern Pennsylvania and rapidly increased its
earnings in this region. Moreover the extension of the system westward
should have increased its earning capacity. Up to this time the Erie had
no Chicago connection and was at an obvious disadvantage compared with
its competitors. It improved this situation in 1881 by acquiring the
New York, Pennsylvania and Ohio, and the