The evening times. [volume] (Grand Forks, N.D.) 1906-1914, 1907-05-02
DOWN TO BED ROCK.


According to the Chicago Tribune.
the speech of President Roosevelt at
indianapolis on Memorial day will be
devoted to very important, even if
seemingly inopportune subject. 1t
is said that on that day he will for
the first time, give expression TO the
plan which he has been considering
for several months by which the diff
ference between the actual value and
the alleged value of the railroads OF
the country may be determined. This
feature OF the common carrier in
vestigation is in fact the foundation
upon which all sensible and safe leg
islation against the present conditions
must be based.
The courts hold that all freight and
passenger rates TO be legal must be
based upon the cost Of building and
operating the road. In a word that
they must be such that they will give
a fair income upon the actual money
invested. The justice of this rule of
law is too apparent to need elabora-
ton. Herein lies the great opportu-
nifty of the railroads however to de-
feat the very principle which has been
laid down. The actual value of the
railroads and the actual cost Of oper-
ating them should be the basis upon
which the rates should be based.
The legislature of Minnesota ap-
pointed a committee to investigate
this condition. 1t found that the cap
italization and funded debt of the
Great Western road was $143,6SS per
mile, while the actual value of
the road per mile was $4,000. The
average valuation Of the roads of the
state per mile was $4,000. while the
capitalization per mile was $4,000.
The difference In these two amounts
indicates the watering of the stock,
or the amount of paper which is out
standing against the property more
than it is actually worth.
1t is a simple proposition that if
hn OF nSs n Go IL
of either passenger or freight rates
which will produce certain percent
age of income upon a valuation of
$143,6SS, it must be approximately
five times as large as though it were
based upon valuation Of $4,000.
This is exactly the condition of the
Great Western road. 1t would make
material difference which of these
bases would be taken by the court
in determining the reasonableness of
rate. The actual valuation of the
road and the actual cost of operat-
ing the same should be the guide by
which legislative action for the fixing
of rates should be controlled. The
opportunity for lodging is apparent
when the difference in the figures
given above is considered.
The president proposes to outline
a plan, il the Tribune is correct.
which will have for it's purpose the
determination of the actual values of
the railroads of the country. It is
big plan. This is a very big coun-
try. There are thousands of miles Of
railroad track in it, to say nothing
of the railroad stations, freight hous-
es, roundhouses, yards, shops, rolling
stock, etc. To ascertain the actual
cash values has the look of a very
large, difficult, delicate and costly un-
dertaking. The first conner is not
competent to pass upon values. Ex-
perts will be needed. Time will be
needed. Money will be needed. It
will be like census taking.
No.nan in the entire nation is more
at home, however, in big undertake
ings than the president himself, and
II there is way for a practical, pos
sible and sensible solution of the mat
ter the country may rest assured that
1t will be given on Memorial day at
indianapolis.
Once this fact is determined the
regulation of both passenger and
freight rates will become simple
matter. This is the foundation of the
regulation Of the railroads and is the
only way they can be reached with
fairness and justice.
THE FARMERS BANK.