The Holly chieftain. (Holly, Colo.) 1897-1987, 1910-07-01
the RELATION OF RAILROAD
RATES TO GENERAL
BUSINESS.


freight rates may be to us personally,
We must recognize that an improve
ment in general business is dependent
on a betterment of operating and
financial conditions of the railroads.
That the operating results are most
unsatisfactory is readily seen by
the latest INTER STATE COMMERCE
COMMISSION reports. which show
that for the nine months ended April
LIST, 1910, eleven railroad systems, all
West and North of line drawn from
Chicago to st. Louis, compared with
the same roads for the same period In
the previous year. had their gross
earnings increased about $50, 600. 900 90,
while their net earnings showed a de-
crease of $500. 100000. and for the
month Of March. on the same compari-
son. they show an increase Of $1,000
10000 in gross and decrease of
$965, 100000 in net earnings.
Attention IL called to the fact that
the wage increases, Except a 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
$2.50O, 100000, or 149o and have to pay
higher rates OF interest on their loans.
These roads covering the most pros
porous part of the country may be con.
sidered representative of general rail-
road conditions.
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 and tracks
now demand q greater proportion of
operating expense. no provision has
been or IL being made for the growing
demands of the country, and as trans
portation Is the backbone Of business,
| Its weakness or inefficiency cripples
every other condition; because all prod
which their accessibility to the con-
Stunning market.
1t is most important to the shipper,
that railroads at all times are fully
equipped to take care of an increase OF
his business. The first eight months OF
1907 demonstrated that the railroads
could not handle the business then Of
fered with any degree of satisfaction
The financial conditions since have not
permitted them to even maintain their
then position. If the then volume Of
business were to come back supple
mented by the three years growth o
the country IN the interval, transports
ton would be paralyzed; and wha
would that cost the shipper compared
with reasonable advance in freigh
rates now? Such an advance would
provide the means for avoiding thi:
impending disaster. The iron horse
needs to be kept in good condition fol
the same reason as the living horse
used for transportation. The team
ster knows that II his horse is no
well shod. well groomed and well fed
and his harness and wagon kept il
good repair. that al he will save OF
such economy will be many time.
wasted In the efficiency of his trans
portation. and also add great expense
with the railroads: the shipper has ;
right to demand that transportation
be ample and efficient; the success o
his business and the development O
the country are dependent on it.
The Investor: To do this. the rail
road must show adequate returns II
maintain proper borrowing credit ant
\ present promising source of invest
ment to procure the necessary fund.
to improve and develop the propert!
as needed. 1t is neither the railroad
president nor the shipper that controls
the situation: it is the investor alone
who holds the key: without his I'm
invested dollar the railroad cannot ex
tend or improve. no matter how grea
the needs of the shipper or the countr,
may be.
With all the increasing cost of op
Grafton, supplemented by ever in
creasing and burdensome Legislative
restrictions concerning their earnings
in face OF the fact that the average
dividend rate on railroads was les!
than 81 per cent for the past 81,
years, and the United States Supreme
Court in the case of the Consolidated
Gas Company stated that "6 per cen
was a fair return on money invested
in public utilities" with the average
freight rate in 1909 of three-quarters o
cent per ton per mile, the lowest IL
nine years, the average passenger rat'
per mile. one and nine-tenths cents
the lowest ever reached. is 1t any won
| der that the investor holds hack am