New-York tribune., 1907-07-13
FARES WOULD GO UP.
DITIDENDS GO DOWN.
Effect Of T5co-Cent Fare Lac on
pRR., according to Pres. McCrea.
rBy Telegraph to The Tribune. J

.Lfshelphia- July 12-PTesldent James McCrea
i. .ss pennsylvania Railroad to-day stated that
-. ,yro-ceat rate law enacted by the last Legis-
-. If Pennsylvania would If put in operation.
- n Widespread advance in the general pas
- rates and great reduction In the dividends
tss road despite this Increase This statement
-. from the president under oath, as witness
/ x.s,,e Judges Wilson and Au2enried in the Com
1 -, Pleas Court of this city on ;he hearing of
ths writ obtained ~ me company TO test The new
/ law
/ Mr. McCrea vas asked by John C. johnson. Of
ognsei for the road 70 tell the court whether IN
/ rs judgment, a uniform charge Of two cents a
/ nile for passengers would be a proper maximum
rre FOR adoption, either regards the interests Of
| .se railroad company ov the public generally.
/ Mr Mccrea gave a negative answer In the arst
/ ,,ace. he said. q uniform charge of two cents q
nile u all classes of passengers is unfair and i'm
rract!caL With TWO cents maximum rate the
fslrOad company could not make 4 sufficient diff
terence between the short distance riders who
rde frequently and the long distance riders who
rse1 the railroad but seldom It was only fair and
nsl that the first class Of passengers must be car
rei at lower rate, while TWO cents mile was
rot enough 10 charge the other class Of passengers
/ This theory and system Of regulating the rates Of
caaginE nad been in existence since the history Of
/ -aUroads began.
The rate of fare continued AIr NcCrea is LARGELY
dependent on the density Of the populations and
the frequency with which the people ride There
s0rf
uated district !ower rate than it-can in a more
,binv populated district, whore it has but a small
/ number 10 draw from In the thicky populated
sisr-irrs enough passengers carried per train
| - make q. the difference IN fares.
That being the case" said Mr.. Johnson, under
49, -vo-cent fare suggestion why can't the com
-. even the whole thing up-it appearing that
ls-ee proportion % the passengers are carried al
- - ,..r5er TWO cents while Others are charged
.s- +hat arlouut-hy the company complying with
.ss legislative enactment by putting all low
teres VI 10 TWO cents and the higher fares down
70 Two cents? Would that not be nice piece Of
abroad management"
SAYS IT WOULD BE UNFAIR
That would not be fair 10 the public" replied
NJ NcCrea. The best policy IS 70 carry the short
distance but frequent riders at lower rate than
y suppose the Legislature i5 passing this two
,srt rate law believed that the business Of the
eTroad would be greatly stimulated by the
s~-ron OF the fare by Increasing the number Of
psssengers." said AIr. Johnson can you tell US
TT6ether II your experience would this be SOP
4bFv observation and experience replied the
ps-nsvlvanlas president, is that stimulation Of
,-.ve Is dependent very largely on the character
- ,he service rendered and the natural increase
:. hueiness with the growth OF the country The
rssnc,ior 10 two cents IN the fare rate does not
sHect the short riders, as they already pay less
Int even II so, the number OF passengers IS not
--s,stslv Increased except by the natural growth
/ n re country. Then, outside the densely popu-
lstsd districts. e two-cent fare would not be
.-,ush 70 be rernuneratlve. People. a rule. do
II rot ri6e because the fare is cheap. but because
N the necessities OF business The growth OF a
II
business and the increase or population OF the
WV aorIi reduction Of the fare from five cents
% two cents in your Judgment, percepubly in
crsase the number Of passengers? asked Nj John
7 think not"
"Ts there something thet Goes suNlu4aIe paSseii-
| ger trailer.
Yes sir"
/ HFsase state what that IS"
Passenger traf1o is increased by the improved
ssrIljtes and increased train service mean the
.reouency OF trains The comforts and conyeI-
fences ana the facility and frequency with "hlch
roris are enabled 10 make trips stimulate travel
snd the many improvements n these respects
vile they have greatly increased travel by rail
road in the last hfty years have also greatly
added 70 the expense Of the company
DIRECTORS DO NOT FIX RATES.
/ NJ McCree said that the Interstate Commerce
Commission would have 70 lower It's rates II the
Scent law went into effect Under cross-e1aliIt-
tio- he =as asked under whose direction tEe rates
q the Pennsyvaria Railroad we're fixed he an
sEeEed that from tine 70 tine the subject OF TICS
vas inquired into BY the passenger oeLe-- 80;
which regulated the fares, both passenger anu
freight on the different lines.
Then the board Of directors has noth!hs 10 u'
Not necessarily: the board Of directors appoints
representative, and he acts in conjunction with
the department having that matter IN cAil5se. 49,
Mr. McCrea answered questions regarding the
tables o5 earnings expenses, etc, Of the passenger
business IN the state presented yes -, .u On
then cross-exarned by City Solicitor GehdeIl on
he figures submitted This brought out nothing
new
On redirect examination Mr.. McCrea said that
# the conrlSLz-ton rates were increased 10 TWO
there would be very considerable oecI
n the general suburban travel Mr. McCFta IIeI
Jeff the stand, after being under examination 10Y
hour
John B Thaye- fourth vlce-prcsdent. was then
called Mr. Tuayer IS in charge Of the general
rsfc business Of the company lie 5ald tle -
cent fare law would not stimulate business he
Supported this ty submitting hguIes on FaIto1S
classes o. passenger tickets which IN the course OF
Frl7 fv rsrig
tsre was very little increase in business DeyoAa
he average natural increase OF many years
WOULD COST 100000 a YEAR
Testitying 70 the increased cost Of the operation
O the road, Mr. Thayer said al! materials IL
creased Il price from 70 = Per cent anu -
tnsre is no prospect this year Of prices coh!i!s
e9sn The increase in wages made Ia7t ysaI 80, 80
e Aa59OJ0 70 The expenses Of the company i.l4N
east q Pit-sl.r. Nr T-cayer said h. estimated
uat the tw5-cant fare law went into effect IL
would cause loss Of more than 100000 year IN
NJ TAayer would not admit that the tables
Showing The 1erclutage of earnings and expenses
y lie passeEeer ols.ness were largely sle9sso-H a.
VI ssle they wtre preraIea On the ol-sis o. g
A-e lan miIeage' used by many TallToaua, anu -
2 Farringtrn second ,-iee-president OF the
Sis1t Northern Railway, followed NJ l--.-s 20
= caaige of accounts ot ne ''tlaI -o ",,te
tle sad tho aprortlJarnent % passenger accounts
|! iae Pennsyiran!a Railroad was the most ia4r
"a could be made. al.
Z 7. Perriue. general manager ce tae Audlt
synpany o. New York the first =" mess al
he afternoon session FFe said he considered the
eppoTuorInert of passenger business by the FeIlI-
ss.lfalla Railroad was made on most eq@ltaolS
asN The witness could not say by what !iIvI4'ot
1ae company arrived az tie difference IN the cost
" wear and tear on one mile Of road between q
sslgAt train OF fifty cars and passenger tram ol
csEs ,e cars He said he did not think the dlne'e''1
c.a be determined
me company mere closed its case and the CITY
g. sc county of Philadelphia Immediately called rs
witness Meyer Goldsmith, oI ms ci''' "''
. an expert accountant