Omaha daily bee. (Omaha [Neb.]) 187?-1922, 1906-04-02


1t is hardly worth while for the
present to speculate on the application
I'm our country of the plan Of govern
ment ownership OF railroads which has
been adopted in Japan, or to take seri-
ously the calculations which have been
made in Washington, to the effect that
on the basis of purchase in japan, or
"a capitalization at 5 per cent on the
average annual net earnings during
three years, it would require $780,
OOOOOO to buy outright the American
roads. We are actually engaged in an
effort to solve the problem by an en-
tlrely different method which has not
yet been tried out nor indeed more than
fairly begun-government control of
roads under private ownership. The
alternative Of government ownership
will not he here resorted to until the
method of control without ownership
shall have been tried out, and that, too,
with the utmost patience and thorough
neSs.
In point of fact ownership involves
most Of the difficulties which are in
volved in control, besides many others.
The fixing Of a valuation for purchase
implies precisely the prerequisite to con-
troll Of roads as to charges on n basis
Of fair compensation for the investment
in them. The question Of fictitious cap
ltalization in the form of watered stocks
and bonds is involved in its length and
breadth in the one case as in the other.
We have not come decisively to that
question as yet, although we must reach
it and answer it before the paramount
object Of control can be attained. What
we are engaged upon just now is an
effort to supply the necessary legal
means of applying the public authority
to rates, by itself not an easy thing,
but when this shall have been accom-
plished it will remain to fix the rates
reasonably, that is to say, to determine
reasonable valuation Of transportation
property on which the owners are en-
titled to compensatory returns.
There is this advantage of the con-
troll over the ownership method, that
1t affords more opportunity for progress
sive application. Government can direct
! its course in the light of experience as
! each step is taken. Under our institu-
tons ownership could not begin except
by fixing irrevocably a purchase valua.
ton in advance. which under existing
conditions could not now be done with
any sort Of safety or certainty. II pro
prietary interests and interests in sym.
pathy or in league with them are SO
potential in government now, few would
be willing to risk 80 tremendous an
issue as that of final valuation on a sin.
gle turn Of the political lottery wheel
oven if no other hazards were included
1t is by no means accepted by our
people, however they may be dissa SIZED
with transportation abuses, as probable
that the public authority through tn.
machinery OF our government, particu
larry the courts, is incapable of ascer
tanning a fair valuation of common car
ricr property as a basis of rates to bs
enforced without taking on the burden
of ownership. Our people were abb,
for centuries to do this The change,
of comm cree the last half century hav,
been so immense that the readjustmen
OF legal means is difficult and require,
tune. 1t would not be surprising If tn,
adjustment proceeds through sucl
movements as the one now coming I,
head in congress and later in til,
courts, the interest that will cry GU
seriously for government ownership
may be the proprietary corporation in
terest.
For the public now striving for con
troll, without ownership, on the line O
fair rates to falter with or turn toward
ownership would be to lose all that ha
, been gained and to postpone, at Ieas
for long time, even the beginning o
tile new regime.