The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1910-06-19

hAldAA NOllAtT investment purchases
of railway bonds have all but ceased.
In one respect, however, Wall Street
appears to be confusing a remedy with
an aiiment- Take, for example, the
policy of retrenchment reported recent
~ on the part of numerous railways. II
is not without its favorable side. Can
no one see in this matter the clements
Of cure, through a process OF adjust
ment? To he sure none Of US like to
have economy forced upon US; but, If
we have been eXtravagant, II we have
made an excessive use Of our credit.
or II some change comes over our for
tune, curtailing our income, how else
can we pay our debts and remain SOL
vent except by retrenching In our ex-
penditures. and by pursuing a course
Of rigid economy?
In this respect the corporation is no
different than the individual It is a
painful process, but economy is a safe
and certain cure for money ills. It is
argued that the process of retrenchment
forced upon the railways Will result
in business depression, affecting all in
dUstry, curtaillng productive capacity
everywhere through the enforced con-
undoubtedly. Is the logical outcome OF
any long continued interval OF extreme
economy forced upon the country s
greatest industry-the railways. But,
as yet, it is by no means determined
that the present interval OF retrench-
ment will be Ions continued, or unduly
severe
In considering this matter, it is not
well 10 lose sight Of the fact that a
country Of 100000 inhabitants, which
extracts 5000 10000. or $1,000. 100000 an
nually from the farms alone, cannot halt
indefinitely. For good and sufficient
reasons IL may pause in a course OF ex-
travagant expenditure, and its total
volume of business may contract some
what. but the pause cannot be long con-
tinued, and the country's trade, despite
the reduced volume Of business. what
ever il may be. muslin the aggregate
amount 10 & tremendous total. for the
90,0oo,N1O must be fed and clothed. and
housed; and the food. clothing. and ma
teTial for housing must Se bought and
sold, and transported, furnishing a vol
ume % business 10 the manufacturer,
the merchant. and the railway. alike.
Productivity and Business Contraction.
Take the other side Of the case. Can
a nation, or a corporation. or an in
dividual. prosper through lavish or
prodigaI expenditure? Such would seem
10 be the argument OF persons who find
nothing but evil IN enforced economy.
II there is any considerable number OF
persons in this country who believe
that the more the corporations borrow
and spend the more prosperous We will
be, and that this process can continue
on indefinitely. the sooner a halt Is
called the better. Yet, in effect, some
thing very ike this line OF reasoning
has entered into the discussion OF rail-
way rate advances recently, for II has
been stated BY certain corporation man
ayers without qualification. that unless
the railways could continue develop
meut work, on an extensive scale. gen
eral industry must be injured irrepara-
bly,.
That the railways OF the country are,
in Justice, entitled TO some advance in
their rates viii rot be questioned by
any one familiar with prevailing con-
ditions, including a knowledge Of the
added expenses OF railway operations
through the higher cost Of labor and
commodities. but II would seem as
though the corporations might have
presented their case in a manner less
disturbing than that pursued. Bust
ness. for instance. has its ups and
downs Good times follow bad, and are
succeeded by good times again, in al
most regular sequence and such has
been the history Of commerce in all
ages.
Until very recently the volume OF
business in progress in the country has
been Of very heavy volume. and except
for a moderate contraction in general
industry. which in all probability will
be Of a character and duration which
will present no new or unusual feature
10 business men, there is nothing pc
cuIiarly disturbing in the present git
uatiOn- and there really seems TO be no
justification for the added aggravatlOn
of that situation, such assuredly as
was contained in the predictions Of
bankruptcy OF railway corporations, IN
less their rates were Immediately ad-
vanced ANY mes sure Of business con-
traction is to be deplored, but then
business cannot always continue at full
steam ahead, and in high cost of labor
and material were elements working