and
these had become an immediate burden to the main system. It is the same
story that has been told of most of the large railroads of those days.
Strenuous efforts were made to save the property from a receivership,
and a committee was appointed in September, 1889, to devise ways and
means of reform and reorganization.

The new management of the Santa Fe was a rational one and substantially
reduced the obligations of the road. Had its spirit been maintained, a
second failure and reorganization a few years later would not have been
necessary. New interests, however, came into the property, and, though
it was hoped that they would support a conservative policy, the former
programme of expansion was resumed until in 1890 the St. Louis and San
Francisco system was merged with the Santa Fe on a very extravagant
basis. Within a year it was clear that the St. Louis and San Francisco
would prove more of a liability than an asset. During the same time the
less important purchase of the Colorado Midland Railway also turned out
to be a poor investment.

The next four years were marked by more bad financial management
which culminated in the failure of the reorganized company. In 1892 an
exchange of income bonds for fixed interest-bearing bonds so increased
the fixed charges of the company that, as a result of the panic of 1893
and its ensuing depression, the great Santa Fe system suddenly found
itself in the hands of a receiver. The president, John W. Reinhart, had
persistently asserted throughout 1893 that the company was financially
sound; but an examination of its books subsequently made in the interest
of the security holders disclosed gross irregularities, dishonest
management, and manipulation of the accounts.

During the year 1894 the property was operated under the protection
of the courts, and early in 1895 a new and comprehensive scheme of
reorganization was carried out. This latest plan involved dropping the
St. Louis and San Francisco system, the Colorado Midland, and all other
unprofitable branches; it wiped out the floating debt; it supplied
millions of new capital; and it enabled the succeeding management at
once to build up and improve the property.

At the head of the new company was placed Edward P. Ripley--a railroad
manager of great executive ability and a practical, broad-minded
business man of the modern type, who has ever since remained president
of the road. The history of the Santa Fe since 1895 has b