Angry Man

2 minute read
TIME

This time Railroader Robert R. Young, who likes to dish it out, had to take it. In a report last week, Interstate Commerce Commission Examiner Charles Edward Boles thumbed down Young’s plea to join the board of New York Central Railroad Co., and, in effect, control it by voting his 6% holding in Central stock.

Examiner Boles, usually a mild-mannered man, looked hard at Young’s argument for a close alliance between the Central and his Chesapeake & Ohio Railway Co. In his report he called it a jumble of “opinions, prophecies, speculation and . . . pure fancy.” Young’s purchase of Central stock with C. & O. funds, he added, was to satisfy “his personal ambition.” It showed “a willingness to take great risks with the company’s funds”; so far, it had let C. & 0. in for a paper loss of $2,400,000. The stock bought at $18.98 a share was now worth $13.57.

As for Young’s charge that Central is banker-controlled, Boles counted only six bankers among the 15 directors on the Central. But he found eight among the 15 C. & O. directors. Young had charged that Central directors represented only 1.5% of the total stock ownership. Boles: “The C. & 0. is controlled by the Alleghany Corp. . . . through an interest which amounts to only 3.34%. . . . [Young’s] interest in Alleghany’s assets is less than 1%. [His] interest in … New York Central, when traced down through Alleghany and the C. &O., amounts to 0.00006%.”

Young was no man to take this lying down. Cried he: “Another decision against the public interest. . . . Two-faced justice. . . .”

The Boles report was not final: ICC could reject it if it chose. It had rejected a Boles report in 1944, when he recommended against Alleghany Corp. control of C. & 0. Even some of Young’s enemies privately thought ICC might disregard this Boles report. Young was still confident that by putting public pressure on ICC, he would finally get control of the Central.

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