The Idaho Republican. [volume] (Blackfoot, Idaho) 1904-1932, 1910-07-22
RELATION OF RAILROAD RATES
TO GENERAL BUSINESS
To the Business Man

No matter how Objectionable an a,
vance in freight rates may be to U
personally, we must recognize that a
Improvement in general business
dependent on betterment Of opera,
ing and financial conditions of tn
railroads. That the operating result
are most unsatisfactory is readil
seen by the latest Interstate Com
merce commission reports, whic]
show that for the nine months end
ed April LIST, 1910, eleven railroa,
systems, all West and North of lin,
drawn from Chicago to st. Louis
compared with the same roads fo
the same period in the previous year
had their gross earnings increased
about $4,000, 100000, while their ne
earnings show decrease of $500,
100000, and for the month Of March
on the same comparison, they show
an increase of $1,000, 100000 in gross
and a decrease Of 1856, 100000 in
net earnings.
Attention is called to the fact that
the wage increases, Except small
amount,) were not in force during
this period, and from now on these
will greatly increase the operating
cost.
These same railroads had their
taxes increased over the previous
year $2,500,0O0.00, or IA per cent
and have to pay higher rates Of in
terest on their loans. These roads
covering the most prosperous part of
the country may be considered rep
resentative of general railroad condi-
tions.
During the past three years of
poor business, railroad expenditures
for maintenance were necessarily at
the lowest point, and in consequence
their motive power equipment aud
tracks now demand a greater propor-
ton of operating expense. No pro-
vision has been or is being made for
the growing demands of the country,
and as transportation is the backbone
of business, it's weakness or ineffi-
cheney cripples every other condition;
because all products are valuable in
the ratio with their accessibility tothe
consuming market.
1t is most important to the ship
per that railroads at all times are
fully equipped to take care of an in
crease of his business. The first
eight months of 1907 demonstrated |
that the railroads could not handle
the business then offered with any de-
gree of satisfaction. The financial
conditions since have not permitted
them to even maintain their then DO
sition. If the volume of business were
to come back supplemented by the
three years growth of the country in
the interval, transportation would be
paralyzed; and what would that cost
the shipper compared with reason
able advance in freight rates now?
Such an advance would provide the
means for avoiding this impending
disaster. The iron horse needs to be
kept in good condition for the same
reason as the living horse used for
transportation. The teamster knows
that If his horse is not well shod, we'll
groomed and well fed, and his har-
ness and wagon kept in good repair,
that all he will save on such econ
omy will be many times wasted in the !,
inefficiency of his transportation, and
also add great expense to the shipper. {
It is exactly the same with the rail-
roads; the shipper has a right to de- {
nand that transportation be ample
md efficient; the success of his bust '
less and the development Of the coun- t
:ry are dependent on 1t. s
The INVESTOR II
To do this, the railroad must show s
adequate returns to maintain proper /
credit and present prom i
sing source of investment to procure +
he necessary funds to improve and a
levelop the property as needed. It '
s neither the railroad president norJ {
he shipper that controls the situa- b
ion; it is the investor alone who h
lolds the key; without his uninvested s
lollar the railroad cannot extend or v
no matter how great the Il
leeds of the shipper or the country a
nay be. e
With all the increasing cost Of ope- t,
alton, supplemented by ever increas- r,
ng and burdensome legislative re- v
trictions concerning their earnings, p
n face of the fact that the average Il
ividend rate on railroads was less a,
han 3 " per cent for the past six O