The Birmingham age-herald. [volume] (Birmingham, Ala.) 1902-1950, 1910-10-17
SHONTS DISCUSSES
RAILROAD RATES
Says Farmers of Country Are
Very Prosperous
AUTOS ARE A LUXURY
Favors Increased Freight Rates He
cause Railroads Have to Meet Re-
forms and Continually BE
Increasing Facilities

| cannot Judge the financial condition OF
a railroad and more particularly west
ern railroads. by sitting in Wall street
| office and studying statistics declared
Theodore P. Shonts, president of the In
| terborough Rapid Transit company, who
is also president of the Chicago and AL
ton railroad, a director in the Iowa Cen
trail, the Minneapolis and st. Louis rail-
road and other corporations.
Mr.. Shonts, accompanied by number
of New York capitalists, returned to New
York October 2, after covering something
like 5000 miles of railroads of the coun-
| try The party covered a territory from
south of the Dakotas and Travelled ex-
tensively throughout the country. Mr..
Shonts is of the opinion that the high
cost of living can be laid to the laws
of supply and demand. He takes cheer
full view of economic conditions and says
the theory is widely promulgated in the
east that the purchase of automobiles
has tended to tie up banking funds and
the issuance of many mortgages, is true
in the west.
1T is true said Mr.. Shonts, ''automo-
| biles are more or less of a luxury. In
the west they are a necessity and are
| rapidly displacng the horse. The auto
| mobile is an economic factor in the west.
| 1t has displaced horses and the cost of
their maintenance and attendants and
has become just as much a necessity as
the sewing machine.
Il have yet to find that any of the
farmers of the west have mortgaged their
homes or their farms for the purpose of
providing funds with which to secure
this modern method of propulsion. They
are PROSPEROUS and do not need, with
the bumper crops of recent years, to
place liens upon their property whereby
to acquire motor cars.
Mr. Shonts then called attention to the
fact that the traffic of the roads in which
he was directly interested, as disclosed
by the earnings, indicate great pros
perity.
1.-The physical condition of all the prop
critics inspected by u.s. said Mr.. Shonts,
average higher than l have ever seen
| them All of the roads had been do
ing great work in betterments.
This brings us to the question of
freight rate increases, which Is the only
solution of the question that We, as prac-
tiS>- railroad men, can seek. 1t has been
said that some of the railroads have
been Issuing bad statements with the
idea in view of making an unfavorabe
showing before the interstate commerce
commission So far as my personal
knowledge extends, no railroad in this
country has done so.
lone of the reasons why increases in
rates should be allowed is because of
the necessity of keeling the railroads
abreast of reforms. Most OF the roads
have outgrown their old facilities and
during the period of readjusting facili-
ties to meet new requirements as Justi-
fed by business conditions. have found
it necessary to expend vast amount
of money.
"For instance, in 1882 the Chicago and
Alton Railroad company prided itself on
having the finest shops In the United
States.
..The locomotives of that day would look
like a tea kettle compared with locomo-
tives of the present day. A car whlch
at that time weighed 10000 pounds has
been displaced by one now weighing loo-
coo pounds.
aThe increased weight has necessitated
heavier tracks, more powerful locomo-
tives and a general reconstruction OF
roadbed and bridges. This has neces-
STATED the larger roundhouses, equipment
of bigger shops. The same is true OF
ward and terminal facilities. You can
understand that when instead of the Old
tea kettle type of engine. capable of haul
ouiries a locomotive capable of handling
not less than 80 cars into yard.
1--WE have had to construct great
deal more of terminal accommodations to
meet the requirements of traffic than the
casual observer would realize IL mas
become necessary to have greater YARD
capacity. Formerly you had only to
maintain a receiving and forwarding yard.
The facilities have cost increased expense
and in the transaction of business which
is offered during the period OF read1ust-
ment much money Is expended
1.-THE liter of extension and adjust
ment of railroad properties which ] have
described is being carried on all over
the United States. Now the railroads
which have taken only mild interest In
the expansion of other properties are
confronted with the situation of having to
make these improvements in hurry.
.The Pennsylvania Railroad company
is very good illustration, for they nave
had to keep somewhat ahead of the re-
uuirements. They have been paying big
dividends into the pockets of the stock
holders, but for every dollar distributed to
a stockholder the management of that
great corporation would set aside another
dollar for the betterment of the prop
erty. They have been fortunate enough
tn be able to do that almost uniformly.
"Outlying railroads, granger railroads,
have not been able on account of the In
sufficiency of income to do that which the
Pennsylvania has done. but they are now
going through the transitory stage that
the Pennsylvania has successfully passed.
ITO enable these smaller roads to in
crease their facilities they must be per-
mitted to charge little more for the
transportation of those products which
are making the farmers of the west very,
very rich.
"Generally speaking" said Mr.. Shonts,
conditions in the northwest are extreme
lv prosperous and in my opinion there
must be a reflex of that condition of
prosperity in the east. Farmers are well
to do
One of the conditions that impressed
his fellow-millionaires on the train of OBJ
servation was the fact that the farmers
are now living In houses that would al,
most be considered mansions with we'll
painted and capacious barns adjoining
the little cabin the pioneer first enjoyed
when he went west and founded his for
| tune.
| This" concluded Mr. Shonts, lis prob
ably the most remarkable thing that came
to our notice. The development of the
country generally is advancing so rapidly
that it will require the untiring energy of
many railroad presidents to solve in the
near future the problem of transporting
| the enormous crops"