Omaha daily bee. (Omaha [Neb.]) 187?-1922, 1910-05-02
FIGHT FOR Low FARE Law



--------------
public as against the railroads. The at
torneys geenral of the various states named
feel II is incumbent upon them to render
to Oklahoma all the assistance within their
power in the cases now before the circuit
court of appeals, inasmuch as an adverse
opinion rendered by this court in so i'm
portant a case would have much Influence
on the decisions. that might by the higher
courts be rendered in their own behalf
when their own cases now pending We're
made ready for trial.
AppOFtiOnment of Expenses.
THE most fragrant error into which the
court in the above cited decision has fallen
lies IN the adoption of the revenue theory
for the appointment OF expenses as be-
tween the various classes of business, and
which, because it is much to their advant-
age. the railroads have so strenuously and
vigorously defended. In proposing this
method all factors of inequality in rates
are absolutely leveled and how the court
coud be misled into overlooking so import
ant factor as differences In rates is in
conceivable.
LAS an Illustration of the harm it works
short example Is cited Assuming that a
railroad transacts a business over GER
tain piece of its roadway, within a certain
specified time, In passenger traffic. and
received a gross revenue therefor on a basis
of 2-cent fare of 100000 of which $50 900 Is
produced by the transaction of interstate
business and $4,000 by the transaction Of
ntrastate business; that the expenses for
carrying on all the business are $75, 900; now
by the theory adopted and insisted upon by
the railroads, regardless Of the cost OF serv-
To- 4 49,
each class of business are in proportion to
the revenue produced by each; so that
there would be charged, under that theory,
$1,000 as expenses against the intrastate
business and $4,000 as against the Interstate
business.
Escaping Expense Share.
Now IL under the same conditions Of
traffic in every particular, except only that
the intrastate passenger rates are 3 cents
per mile instead of 2 cents, the revenue Is
raised to 100000 intrastate, passenger rates
remaining cents per mile on Interstate, a
division Of the expenses under this same
theory, insisted upon by the railroads,
would produce an expense against 1t of
S375OO So that under the last named con-
ditons, the interstate traffice escapes the
payment of $500 of the expenses which,
edged by the railroad that it had truly sus-
tanned and while the intrastate business has
by reason OF the change in rates actually
earned 10000 more but is now charged with
$4,000 expenses and shows only an ad-
ditonal net revenue of s12.5OO So that, by
the use of this method, the net earnings of
the intrastate business have been robbed
for the benefit OF the interstate business.
There are many other reasons why this
mode of apportioning expenses is wrong,
and among others particularly in the pas
senger traffic Is the fact that most of the
local trains are run with the poorer and
more nearly obsolete equipment. crowded
with passengers whereas, most of the in
t6rstate traffic e. favored by having placed
at its disposal elegantly equipped modern
trains. weighing from two to five times
! as much per train and consequently wear
in the track and equipment in that ratio
With Cne-half or less the number Of pas
engers to the car. This would indicate
that, as a matter of fact, II the proper
disclosure Of the actual conditions were
truly set forth the intra-state business is
being done by a smaller expense than
the interstate.
! while the conditions in the cases, sc
| far as the testimony has been taken in
Nebraska, would Indicate conditions more
| favorable to the state OF Nebraska, thar
| in other states, where litigation is now
In progress. a decision rendered in the
! Oklahoma cases adverse to the state would
be likely to embarrass the state of Ne.
brssAa considerably"
|