The evening times. [volume] (Grand Forks, N.D.) 1906-1914, 1910-10-13
Railroads Forced to Pay More
for Labor and Material
Than Formerly
MORE TRANSPORTATION
IS NEEDED IN COUNTRY
Rates Must Be High Enough to En-.
able the Railroads to Make Neces.
sary Repairs-No Money Will Be
Available For Future Developments.

Available For Future Developments.
Washington, Oct. 13.-Interest in
the hearing conducted by the inter-
state commerce commission concerning
the proposed advance In freight rates
by the railroad lines east of Chicago
showed no diminution today. The
statements in support of the increases
in rates made yesterday by President
James McCrea of the Pennsylvania
Railroad company brought favorable
comment from other railroad officials.
While President Willard of the Bal
timore and Ohio Railroad company and
President Brown of the New York
Central lines are to testify, the rail-
roads practically are prepared to rest
their cases on the statements of Nc
Crea, coupled. of course, with the sta
tistical details which alreday have
been placed in evidence.
The likelihood is that within few
days the formal official announcement
will be made Of further suspension of
the proposed advances by the rail-
roads. February has been deter
mined nupon as the date to which the
proposed tariffs will be suspended.
In his testimony President Nc
Crea urged the necessity from the
view point of the railroads. in making
the proposed increases in rates on
account of the increased expenses in
wages incurred by the roads during
the last ten years-aggregating 33 per
cent in the case of the Pennsylvania
railroad-the increased cost of living.
which bears upon every operative in
the railroad service and the increased
cost of maintenance of a railway
service adequate to the needs of the
American people.
He testified that the results of the
constant increases in the business of
the Pennsylvania railroad. through a
long period Of years had been dis
tributed either through reduction in
rates, increases in amounts paid for
wages and material, or by re-invest-
ments in the property not capitalized.
He expressed the belief that prop
erty of the magnitude Of the Pennsyl-
vania. rendering service satisfac-
tory to its patrons and deriving, as
it did derive in 1909, net earnings to
the amount of only Sol per cent Of
the omunt actually invested in the
property" was entitled to fair con-
sideration by the government and by
the people, and he could not under
stand how a system Of rates, which
secured such results could be regard
ed as on too high a basis.
The cross-examination Of Mr.. Nc
Crea was conducted by Louis D.
Brandeis of Boston, representing the
Atlantic Coast Shippers. In response
to inquiries, Mr.. McCrea said that
during the last ten years the en-
ployes of the Pennsylvania railroad
had received increases in wages that
aggregated 80 per cent. This advance
was given them because Of the extra
ordinary cost Of living, principally,
although other causes had a con-
tributory effect.
Notwithstanding the increased cost
Of living, he added, the $1,000 stock
holders of the Pennsylvania railroad
-one-half of whom were women and
children-were receiving the same
amount in dividends now as they had
received during the last ten years,
although their expenses had increas.
ed.
In a general way, Mr.. McCrea testi-
fed that the proposed advances in
rates were considered necessary by
his railroad because the increased
inroads on the income had to be re-
couped by an advance in rates.
Continuing, Mr.. McCrea said the
Pennsylvania system never had been
operated with greater economy, ef-
ficiency and skill than at present.
"How do you know?" inquired Mr..
Brandeis. "that such things as has
been developed in the Illinois Central
graft arc not occurring in the Penn
sylvania system7"
II do not believe such Q condition
could exist. because of our system Of
reports and checking" said Mr.. Nc
Crea. II know. too. through my faith
in the organization and In my con-
fidence in the human agencies in
volved."
At the beginning Of the afternoon
session, Mr.. McCrea. speaking gen.
orally of freight conditions. declared:
What this country needs and what
has done so much to develope 1t, are
the transportation facilities. At this
time. feel that improvements are
very badly needed. Any scheme of
rates which does not provide for that,
treating the railroads as broad
proposition, will fall short Of what
the country absolutely requires"
Mr., McCrea expressed tho opinion.
in general way. that any properly
capitalized company. economically
and scientifically managed. should be
enabled to earn q minimum of seven
per cent on the investment,
He said that 1t formerly was the
policy of the Pennsylvania railroad to
put a dollar in improvements for
every dollar paid In dividends. but