Los Angeles herald., 1910-07-15
Public Letter Box
ADVOCATES GOVERNMENT
OWNERSHIP OF RAILROADS

Editor Herald: Being in Los An
geles the last three weeks, reading all
the city papers, l have noticed that
they are all anti-railroad rule and
for good government, except one, that
is always anti-everything but boss
rule and bad government. Yet none
of them suggests any measure to rid
us of railroad government that was IN
augurated during our Civil War under
the then very popular plea that a
transcontinental railroad was a neces-
sity as a war measure. Under that
plea special privilege seekers found
very little difficulty in establishing the
precedent of government building rail-
roads for them to own.
1t was the beginning of our degra-
dation TO the slavery of railroad gov
eminent instead of free government
"of, by and for the people" From
then utnil now railroads have been
mainly built by subsidy of either the
government or the people, while the
latter have been spasmodically fighting
for government control of railroads
only resulting in firmer railroad con-
troll of government.
1t is not too much to say that the
government could build all our rail-
roads for three-fifths of what 1t cost.
few years ago Ryan, one of the
greater railroad magnates, testified
that "90 per cent of all railroads are
built with bonds" Had he said 99
per cent are built with the proceeds OF
stock and bonds sold by their promot-
ers he would doubtless have testified
equally truthfully. What constitutes
the value of their stock and bonds be-
fore they are invested in railroad con-
struction? It can't be the cost of is
suing them, because that is merely
nominal. 1t is the fact that our laws
virtually guarantee to all promoters
of public utilities the right to charge
such rates for their services as will
pay a reasonable interest on their in
vestments over and above all running
expenses, and our courts hold that
per cent is reasonable
People must continue to pay this
per cent, or more. until they own the
railroads. And is it not equally APP
parent that it is the credit and ability
of the masses to pay it that actually
builds our railroads, while they don't
own a mile of them? This is surely
the greatest special privilege ever
granted to any class of men, for II
has produced multimillionaires like
mushrooms.
Government 8 per cent bonds always
have sold at or slightly above par, al
though not made receivable for all
government dues. That provision
would make them a circulating me-
dunn equal in value to any of our
lawful money and probably even more
desirable, because they would be 30
per cent better savings bank in the
hands Of anyone able to hold them
than will be President Taft's postal
savings bank, if 1t is to pay only 2
per cent to depositors as reported,
With such bonds we could build all
needed railroads and purchase any ex-
isting desirable roads by merely pay
ing them out directly for such pur-
poses, thus saving all expense of ad-
vertising and selling them. Then the
people would have only to pay 3 per
cent on the actual cost of the roads
to both own and control them, instead
of per cent on any value railroad
magnates claim their roads have cost.
w D. HOBSON.
Nordhoff, Cal, July 12, 1910.