“The government now provided for the issue of consolidated railway bonds guaranteed by the government. These all bore the same rate of interest, three per cent payable annually. They were in five series, due in 20, 40, 60, 80 and 100 years respectively, an equal amount of each. They were in denominations of $20.00, $50.00, $100.00, and $1,000, with coupons for the interest attached, the lower denominations payable at the earlier dates. “These bonds were issued in exchange for the railway securities on the following terms. Bonds at their face value were allotted to each road to the amount of its estimated cash value, plus its net earnings for that one year next preceding the passage of the act of purchase. Many roads earned only enough to pay their running expenses, and these received only the amount of their appraised valuation. For the purpose of the distribution of the allotment of the purchase bonds to the holders of the railway securities in any given case, account was taken of the market quotations of the several sorts of stocks and bonds at a date one year previous to the act of purchase, and the value of each person’s holding thus ascertained. Then the purchase bonds were distributed to the individuals pro rata to these values. When seven-tenths in interest of the proprietors of any road accepted the terms of the government purchase the other three-tenths were obliged to accede or lose their interests. “A few roads held out for a short time, but after the ice was broken they all at once became eager to transfer their properties to the government. The railway consols at once became popular and were rated above par, the government guaranty making them in reality national bonds. A new cabinet office—secretary of transportation—was created. All the employes on the roads from the superintendents of transportation down, held their places under civil service rules, and this branch of the administration never came under political conditions, but was managed upon strictly business principles like the post office. The income from the roads, from the very first year not only paid the interest on the railroad consols, but yielded a handsome surplus that was annually laid aside in safe investments to serve as a sinking fund for the redemption and cancellation of the bonds as they should mature. Before the end of the twentieth century one-half of these bonds had been retired and great reductions had been made in passenger and freight rates and the service had vastly improved over what it was in your day. Strikes, freight and passenger rate wars with their terrific waste and demoralization of business were things of the long past. Many other leaks of railway earnings were stopped when the roads became the property of the government. Many small pieces of road became consolidated under one superintendence; hordes of directors, presidents, vice presidents, general managers, general agents, solicitors of business and other