CUNNINGHAM UPHOLDS I. C. C. RAILROAD DECISION

"The adverse ruling of the Interstate Commerce Commission with regard to the Van Sweringen railroad merger will probably tend to clarify matters in further transportation consolidation," Professor W. J. Cunningham, Professor of Transportation in the Business School, told a CRIMSON reporter last night in an interview on the recently proposed Nickel Plate merger. "The railroad builders can now know what to expect from the Commission, and thus have a better idea of how to proceed. More over it must be clearly understood that it was the financial and not the transportation side of the affair to which the Commission objected. The merger from a railroad point of view was distinctly held to be beneficial to the general public."

Professor Cunningham went on to say that for these reasons further general consolidation would probably be increased as a result of the decision. He also expressed the opinion that this particular merger would go through after a financial rearrangement, more advantageous to the stockholders of the Chesapeake & Ohio railway had been made between them and the Van Sweringens.

When asked how the decision would affect the campaign Professor W. Z. Ripley has been waging for better conditions of corporate control, Professor Cunningham said, "This decision of the Interstate Commerce Commission is in direct accord with Professor Ripley's contentions. It is obvious that if only ten percent of a large issue of stock carries voting rights, a group of small minority holders can gain control of the whole thing, since all they need is 51 percent of ten percent. It was against this feature of the merger, as much as any other that the unfavorable decision was aimed. Professor Ripley, who was connected with the Commission in an advisory capacity, is thus supported in his endeavors by the ruling.

In discussing the sudden drop in the stock market Professor Cunningham said that he thought it due more to a natural reaction to the former high inflation than to the effect of the collapse of the Nickel Plate merger, that the bubble of speculation had already reached undue proportions and needed only the prick of some such shock as this to make it burst.

"There is considerable distress selling at present," Professor Cunningham continued, "but in a short time there will undoubtedly be a rebound in the general market."