The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1905-07-27
THE PEOPLE PAY EXTORTIONATE
TRANSPORTATION RATES.

The people little realize the bur-
dens placed upon them by high rail-
road rates If the legislators of any
Southern State had increased the tax
within the past eight years as much
as the railroads have increased the
freight rates, they could not have been
reelected. This increase has been
mainly by a change in classification"
and other roundabout ways. And it
is because the Esch- Townsend bill
would prevent such eXtortionate rates
that the railroads are moving heaven
and earth to emasculate it or to kill
it.
Hoke Smith is presenting many
facts for consideration in his speeches
in Georgia-facts that can be studied
with profit by the people of other
States. He shows that in ten. years
the railroad mileage in Georgia has
increased less than nineteen per cent
while the net earnings have increased
over ninety nine yer cent. AS an illus
tration of how the railroads are max
ing too much money by imposing too
heavy burdens upon the people, Mr..
Smith said:
Let us again approach this ques-
ton from another standpoint. rake
the Southern Railway Company: "A
little over ten years ago this property
was organized out of the properties
of the Richmond and Danville and
in
company issued $60,000,000 of pre-
ferred stock and $120 100000 of com
mon stock. The stock represented at
the time little or no value, and yet
this stock has increased in market
value during the past ten years about
$75,O0O0O0. This increase or new
value of the ,watered stock Is due 10
the money which the company mas col
lected from the people for transporta-
ton. If this company has collected
money enough from It's charges for
transportation to add $75,00O,OOO of
market value to it's stocks IN ten
years, has it not taken from the peo-
pie annually the money by which 1t
mas created this value, and created 1t
practically out of nothing, except
what it has unjustly collected from
its shippers? What has given to TINS
watered stock this value of 10000
0O0?"
He shows from the sworn reports
that the railroads charge rates high
enough to pay five per cent on the
money invested and in addition take
from three to four million dollars
year from the people in excessive
freight changes. The people of Geor-
gia are not the only ones who are
enabling the great railroad systems
to create something out of nothing
bv high rates. The railroad is en-
eitIed to earn a fair dividend upon
the money invested, but it is a great
wror to permit rates to be high
enough to pay a dividend on watered
stock or to add seventy-five million
dollars to the value of the watered
stock in the Southern Railway in
ten years. and like additional value
to watered stock of other systems,
There is sneed that these facts be kept
before the people so that they may
elect men who will think more of the
people who pay the high freights than
of those who impose the high rates.
one reason the people 40 Iol get Jus
tice is that too many public officials
owe obligations to railroads or are
ignorant or timid. THE people will
forget that you sacrificed to servo
them" said North Carolina politician
once. while the railroads will remem-
Der and will show their appreciation
If that has been true in the past, the
voters ought to see to it that such
charge cannot be truly made in the
future. They should stand by men
who serve their best interests and turn
the cold shoulder to men who tote
water on both shoulders or serve the
railroads When they do that, instead
of increasing watered stock seventy
five million dollars in ten years, rates
will be so adjusted that the seventy
five million dollars will remain in the
pockets of the shippers and consum-
ers.