The herald., 1897-07-16
REDUCTIoNoF RAILROAD RATES

REDUCTION OF RAILROAD RATES
1t Is not uncommon for railroads to re-
duce rates for excursion purposes. The
practice is suggestive. 1t is done to in
crease patronage. to fill up the cars that
there may be no need for running empty
trains. May it not be wise to reduce
volume of traffic? None so well under
stand as railroad people that the rum
ming of loaded trains costs but a trihe
more than running empty trains, that
the increase of cost bears no proportion
to the increase of the volume of traffic.
1t is like the decrease of postal charges,
which induces more letter writing and
more patronage of the malls, which ac-
tually enlarges rather than decreases
the postal revenues without proportion
ate enlargement Of the cost Of the postal
service. 1t is undoubted that people will
travel more and ship more freight il
rates are lower than if they were higher.
The railroad people will say there are
certain expenses and fixed charges that
must be paid before any dividends are
paid to stockholders. That is all true,
but suppose they stimulate the COM
merce of the country and the roads re-
ceive more revenue from less rates than
derived from higher charges. without a
proportionate increase of expenses?
When times are hard and people are
poor, would it not be wise to make rates
adaptable to those conditions? Must in
come to railway securities be kept up
regardless of the ability of the public to
pay them? Profits to railroads depend
upon the prosperity of the people. Wages
must come down when times are hard.
The holders of railroad bonds and stocks
ought to share the fate of the patrons.
Men may have invested in railroad Sc
curities unwisely. but they should not
be protected against loss any more than
those who invest in houses and lots or
any industrial enterprises. Railroads
are largely over-capitalized; that is to
say, above what would be the present
cost of reproduction. That may be I'M
fortunate, but the misfortune should not
be shifted to the patrons of the roads.
If they have lost they must grin and bear
it. Railroads will not stop if the holders
of stocks and bonds are subjected to
loss. 1t is fair that they should submit
to loss rather than that the
producing people should be SUBJ
jected to what they are unable to en-
dure. 1t is no fault of theirs that con-
ditions are as they are.
If railroads want to reduce expenses
why do they not begin at the top and
reduce the salaries of presidents and
other high officials? They are paid sal
aries far above those paid to public off,
Gals and far out Of proportion to what
is fairly compromising. Exorbitant sal
aries are tax upon the people and not
upon the bond and stockholders More
aries of the high officials than by re-
ducing the wages of shopmen, truckmen
and freight handlers. Exorbitant rates
are not advantageous to the roads, and
they are an oppression to their patrons.
By putting rates down the people will
be relieved and the earnings will be in
creased.
The solution of the railroad problem
lies in getting rid of over capitalization
and the reduction of official salaries. No
property is worth more than the cost of
reproduction. If capitalized above that
figure, there is no just outcome except in
loss by the security holders Of the differ.
ence. We would not destroy or impair
railroads, but they must stand upon the
same basis of those who have made un-
profitable investments in other proper
ties or enterprises. ~
The results of excursion rates are In
dicative of what will be experienced in
general reductions.