New-York tribune., 1911-01-03
HIGHER EFFICIENCY
NEED Of RAILROADS
Not Increased Freight Charges,
Says Louis D. BrandeiS, Traffic
Commission Counsel.
COULD SAVE MILLION A DAY
Scientific Management and the
Elimination of Questionable
Practices to Increase
Income.

u oOb1CCo w 4hSl C0oO
Income.
Washington, Jan. 2-Higher standards of
efficiency, not increased freight charges,
are the paramount needs to-day OF Ameri-
can railways.
This proposition is the essence OF the
brief filed to-day with the Interstate Com
merce Commission by Louis d. Brandeis
Of Boston, counsel for the traffic COM
mittee OF commercial organizations Of the
Atlantic seaboard. in the investigation by
the commission OF the proposed advances
in freight rates by carriers in official
classification territory-that part OF the
country east Of the Mississippi and north
OF the Ohio and Potomac rivers.
Railroad managers, Nr. Brandeis con-
tends. in an effort 10 meet existing needs
should not look without. but within
'Tf their net income is insufficient" he
says, ''the proper remedy is not higher
rates. resulting IN higher costs and
lessened business. but scientific manage
ment. resulting in lower costs. in higher
wages and increased business. IF their
credit Is impaired, the proper remedy IS
not to apply the delusive stimulant OF
higher rates. but TO strengthen their or
ganizations by introducing advanced
methods and eliminating questionable
practices. Thus they will maintain credit
by deserving tt
The proposed advances in freight charges
by the lines In Official classification terri
tory would affect only tho class rates. The
total freight tonnage Of the lines for the
calendar year 1909 was s26,S21.Eb OF this
tonnage less than 8 per cent moved under
class rates. yet Of the freight revenue of
these railroads for the calendar year 1909
nearly % per cent (s1oe, ,2n, ,S23) was derived
from otass rates. These rates govern In
the shipment of over four thousand articles
OF commerce. including most of the necessi-
ties Of life and articles of competitive com
mercs. The proposed increases vary from
per cent 20 q per cent, averaging approx
mately is per cent.
Mr.. Brandeis indicates that he considers
the great question involved In tho investi-
cation to be the statement of President
willard, of the Baltimore & Ohio. that
the tendency OF rates will be 20 continue
upward" that is, that there will be a pro-
gresnve Increase IN rates.
co-operation to Reduce Costs.
"As an alternative TO the railroads
practice OF combining 70 increase rates, "
suggests Mr.. Brandeis. I'VE offer coop
Grafton to reduce costs. Instead OF a
dangerous makeshift, we offer construc-
tive policy-scientiho management, under
which, as costs fall. wages rise"
The consumer, he points out, should
beware OF the vicious circle oH ever-in-
c,casing freight rates and everincreas-
ing cost of living"
The law places the burden OF proof of
tho roasonableness Of the proposed sd-
N.rtcs upon the railroads Mr.. Brandeis
maintains that the roads have failed
utterly to sustain their burden OF proof;
have failed so completely that the appli-
cation Of the railroads for approval Of the
now tariff should be denied"
In a discussion Of scientific manage
ment." II is maintained that the conten-
ton Of the railways that tho possibilities
Of economy in rairoading have been prac-
tically exhausted 'is contrary TO all humnn
experience in other lines Of activity. Ad-
vanccs in the art OF transportation have
been relatively few" and some OF those
have been forced by law against strenuous
opposition.
ment demands the separation OF planning
from performing; changes the relations Of
the mana cement TO labor; demands pre-
paredness; analytical study. records OF in
custrial performance and standardized
methods and equipment. It Increases the
efficiency Of the Individual. Of the plant
and equipment and Of material. 1t also
Increases the emolunents OF both capital
and labor. It eliminates graft. too, in the
opinion Of Mr Brandeis In the purchase
Of supplies and in the cost Of construction
work. Publicity, he argues. is an essen
tlsl condition Of freedom from graft.
Could Save s1,ooOoOO a Day
II Is maintained. IN the conclusion OF
fhis part Of the brief. that "at least 81
On0H0 day could be saved by the pursuit
Of methods Of scientific management Of
American railroads.
In response TO the contention of the rail-
roads that the proposed increases in class
rates are reasonable. Mr Brandeis urges
that no evidence was presented 10 sustain
tie contention that no Increase in any
class rate properly can 10 made without
giving the shippers an opportunity 10 he
heard. and that the pending increases were
nTe1 without dIOINluB lIe SilppclS sum
en- opportunity. He argues further that
"the injustice and inequality in the exist
ing classiAcauons are such that no hori-
zontal advance I'm rates could be made
without great hardship 10 the shippers In
communities affected, that the proposed
increase seriously distorts. on some rail-
roads. tho relation OF long distance 10
short distance traffic; that the imposition
Of nearly the whole burden Of tie in
creased rates upon class rates appears
20 be unjust that the proposed increase
would seriously contract the market oi
the manufacturers and merchants OF the
Atlantic seaboard. that it would seriously
increase the cost OF living, and that j
would reduce the volume Of long distance
tonnage. and hence the expected gross
revenue OF the railroads"
As 10 the argument of the railroads that
they need additional revenues on account
Of required increases in wages. Mr.. Bran
dcls submits three propositions:
First-Some railroads, at least do not
need additional income.
Second-ln some railroads any existing