The San Francisco call., 1908-11-27
STRANGE DEMAND FOR HIGHER FREIGHT RATES

argument against proposed freight
railroads IS assuming somewhat confused shape
always well directed For instance argument from
what the traffic will bear properly addressed the
which rates NAV be fixed
formulated basis The
rule that given product be transported which will
make shipment improbable The word
compel railroads carry freight loss, and this be the
inevitable OF the application OF this principle all
products II quarng grindsone for in Cali
ship his product 25 hundred the railroad be
compelled to grant him that unless pays profit
pOrtaton. -
very because the rule of what the
traffic will bear has always hitherto been the basis which traffic
managers have made their schedules It still pertinent
ent addressed 10 the discretion OF traffic and will
doubtless have weight with railroads handling California
products Il their business business and the producers
can demonstrate TO them that the proposed increase VIII wipe out
important lines OF transportation that argument should
sive with them It's not the interest Of railroads down the
volume OF transportation
This argument on what the traffic viii bear has of course two
sides It be considered the light OF what the expense Of
product can pay for the service
this regard would be by the
interstate commission If It could be shown that the increased rate
argument yet addressed
these facts We recognize the difficulty OF securing evidence
this natter but the effort ought TO be made.
general argument presented bearing the apparently
prosperous conditions affecting the business OF the Southern
and the Union Pacific based reports earnings these
systems during the later summer months and this argument
altogether pertinent and proper be presented the
During the early Of the year these roads showed heavy
decline IN net earnings due TO the prevalent depression but
August and September they did business that profitable
heretofore
mped prosperity On the subject OF conditions affecting
railroads handling California freight York Financial
Chroniclethe leading authority com
the July earnings this year The Atcson Topeka and
Santa Fe with S9455 loss gross gain net the
Southern Pacific through reduced expenses decrease
Of SZ0366 OF $1,000 net and
similarly the Union Pacific changed decrease of S84 gross
into increase of S32l,39l in net"
These very striking figures reports for August and
September similar in their bearing They
upset completely the pretense increased cost of labor
requires higher because the railroads enabled to show
by
mostly labor reinforce showing with the fact that these
railroads all paying comfortable vast issues of
stock which mostly the argument against the increase
Of would appear difficult refte Southern Pacific for
instance has stock OF 8O0OO all water and
selling the market S2O The claim IS advanced
that the stock been
tcay rebuilt the Of the
OF the Southern Pacific lines have
estimated between S0o00o and S0O00OOO not penny OF
that great has OF the pockets common stock
holders All that money and great raised by an
Of S4OO0 in preferred stock earning per cent dividends
What became OF the millions required rebuilding the
roads nobody knows for publication but proper subject
for inquiry before the interstate commission
A system that pay per dividends on nearly
OOO0 OF atered stock will standing court
before the commission support of the allegation that its trans
poaon business improbable by of low Moreover
the inquiry might prove awkward if pressed home to an
examination Of the methods of high finance showing is So
conclusive and the ahead dangerous Call
inclined regard the demand for higher which will
vanish into thin air if it met in determined manner
cTTTErEr 1yopcUc hN1, o~ror.