The Portland daily press. [volume] (Portland, Me.) 1862-1921, 1889-10-01
TOO MANY LINES FOR THE BUSINESS.
Commissioner Taylor's Report on
the western Railroad Situation.
The Companies and the Public We're
Roth at Fault.
Measures Suggested to Put Matters
on a Business Footing.

WASHINGTON, September 3O.-ln MS an
nual report, Horace A. Taylor, railroad
commissioner, says 81 believe that in
many sections Of the West, t,Iconspicuously Ia
Iowa and Kansas, the mileage Of railroads
is greatly in excess Of the legitimate needs
Of the carrying trade. If this be true, many
investments in railroad properties there
must fail to yield remunerative dividends or
the schedules of rates must be fixed SO high
to prove ruinously burdenseme to traffic.
The people have encouraged railroad con-
struction wherever 1t could be secured re-
gardless of existing necessities or future
complications. The railroad companies have
been unduly eager to control trade by build
ing new lines and feeders for established
ones, where the volume Of traffic has not
been sufficient to support them. Relief caa
only come through increased settlement,
stimulating business and developing natural
resources. The interests of the railroads
and the public suffer from railroad managers
devoting their energies too largely to secur
ing trade from competing centres and not
sufficiently encouraging the development Of
local traffic. The questions involved are Sc
rious and important. l am OF the opinion
the time has arrived for some positive legis-
SIT has been found that legislation estab-
fishing sinking fund and providing for the
payment of a certain per cent OF the net
earnings of a road into 1t, will not realize
final extinguishment of debts due the gov
ernment Should funding bill be present
ed to Congress, 1t should be carefully guard
ed so as to protect fully the interests Of the
government and impose no unreasonable
obligations, or undue hardships upon the
railroad companies. There should be an ex-
tension of time and a reduction of the rate
Of interest. am not thoroughly convinced
that the end sought can be best attained by
the passage Of funding bill providing for
failures or a years business depression
might render the companies unable to meet
their obligations. Should Congress impose
such arbitrary conditions In regard to fixed
payments as might render compliance upon
the part of the companies practically impos-
sible, it might be necessary for the govern
ment to pay off all liens prior to its own and
take possession Of the roads, a condition
certainly desirable to avoid. | have come to
the conclusion that the most feasible plan to
be adopted Is to grant a reasonable exten-
sion of time with reduced rate Of interest; !;
to require tie payment of a certain percen-
tage of the earnings Of roads to be applied
to the liquidation of their indebtedness to
the government and to require payments to
be made from percentage of the gross.
rather than the net earnings of roads. This
will avoid many serious complications In
determining the exact amount to be paid by
all railroad companies indebted to the gov
ernment which own or lease and operate
various lines and branches In addition to
those subsidized. The government has no
claim upon any part of the earnings of
these non-subsidized lines. Traffic may be
diverted either naturally or with purpose
from the aided to the nOn-aided lines and
various charges in the expense accounts may
be entered up as against the aided portion Of
the road that rightfully should be chargeable
to the non-aided portions.
SIT is apparent beyond controversy that the
subsidized roads cannot discharge their OBJ
legations to the government at maturity. The
existing laws are wholly inadequate to Sc
cure the payment Of the debts due and
shortly to become due. 1t is imperative that
our congress provide some measure of re-
lief and it would be wise to pass an act re-
quiring that the earnings for all government
transportation by subsidized companies on
all lines operated by them, aided or nom
aided, be applied to the payment of any in
terest or principal due; prohibiting the pay
ment Of any dividend, by any Of the subsi-
died companies, unless such company
bonded debt having lien prior to the gov
ernment. and all matured indebtedness and
interest then due, and of such a percentage
OF the gross earnings Of the subsidized lines,
as would realize funds sufficient to pay
accruing interest and raise a sinking fund to
meet the principal of the debts at maturity.
Said companies should be permitted to re-
fuRd the first mortgage bonds under such
provisions as would prevent any increase In
the debt allowed priority over the debt to
the United States"