Out and In

President Frederick Douglass ("Fred") Underwood of the Erie sat in his Manhattan office last week. He had just resigned his job and those "mighty fine young men," Oris Paxton Van Sweringen and Mantis James Van Sweringen, had replaced him with President James J. Bernet of their Nickel Plate road. This was probably another move of the Van Sweringens towards their merger of the Nickel Plate, Erie, Chesapeake & Ohio, Pere Marquette and Hocking Valley roads into their Nickel Plate System, which the Interstate Commerce Commission thwarted last March (TIME, March 15). President Underwood has always been "good copy" for newspaper men. There was the time when he was arrested for disorderly conduct because he would not get off a Staten Island ferry to buy a return ticket to Manhattan. He insisted on paying a deck hand. There was another time that Leonor Fresnel Loree had Mr. Underwood up in the Delaware & Hudson's office, reciting a long table of statistics about ton-miles and locomotive-hours. Mr. Underwood listened to the end, then, pointing to the pictures of eight presidents of Mr. Loree's Delaware & Hudson, said he: "That's all very true. But it's also true that 12 1/2% of the presidents of the Delaware & Hudson committed suicide." One of the eight had done so. There was also the time when Mr. Underwood was the butt of witticism by Chairman William Haynes Truesdale, of the Delaware, Lackawanna. "Who was that Negress you were talking to?" boomed the Erie's President Under ood at Mr. Truesdale. Mr. Truesdale, who always seemed sleepy eyed, answered: "She was not a Negress. That was Phoebe Snow and she has just come back from Buffalo on the Erie." Mr. Underwood, during his 26 years' presidency of the Erie* made it a road excellently operated. But he had not been able to pay his preferred dividends very often, and had never paid common dividends. That was because the Erie has been loaded with an overheavy financial superstructure. To equate the finances will be the duty of the Erie's new president, John J. ("J. J. B.") Bernet.

John J. Bernet was born in 1868, son of a Swiss blacksmith. He too learned the blacksmith's trade and became the best horseshoer in Farnham, N. Y. But locomotive smoke smelled better than forge smoke. Young John got himself a job as a telegrapher.

The Van Sweringens brought him to their Nickel Plate ten years ago. An operating genius, he reorganized, practically rebuilt, the road; made it as efficient a freight carrier as any other line of the country. He is a sales genius too. When the Union Trust Co. of Cleveland contemplated its present 21-story bank and office building, President Bernet got the business of hauling the construction material. That was a triumph. But it lasted briefly, for the late President Alfred Holland Smith of the New York Central heard of the matter. The New York Central had long done considerable business through the Union Trust Co., so President Smith rushed to Cleveland, angry. Nickel Plate President Bernet did not contend with New York Central President Smith. They shared. President Bernet's removal to the Erie leaves space for the promotion of Walter L. Ross to the presidency of the Nickel Plate. He has been senior vice president.

*He is 74 years old now, at his resignation. He likes to make a mystery of his age. But once, off guard, he remarked that he was 18 when he went to work for the Chicago, Milwaukee & St. Paul, as a clerk and brakeman. That was in 1870.