The Birmingham age-herald., 1913-06-12
President Milton H. Smith Gives Reasons Why
L. & N Cannot Accept Rate Reductions

ACCcpl Ndlc NeuuCllOnS
able to dividends thus destroying their credit and
become unable to pay the interest their ndeb
edness?
must be plain to all that if the present tendency is
not checked the interests of the country at large
be dsastrousy affected resulting great losses and
fering, especially to those dependent upon regular en-
poyment at remunerative rates. a.
1t is argued in of the press that the Louisville &
Nashville Railroad management deserves condemnation
because resist the reduction in rates that has been
ceped by other roads 1t is asserted that the other lines
are transporting at the reduced rates without
mourning losses 1t must be remembered that the other
railroads referred to mainly the Southern Railway
and those controlled by it, namely the Alabama Great
Southern and Mobile Ohio Surely the people of Ala
bama have not forgotten that this reduction forced
them that they did not and have not, willingly
ceped such enforced reduction than 1907 the license of
the Southern Railway Company to transact business in AL
ALBANIA cancelled the nominal reason being the transfer
of suit from the State court to the United States
but the real being the alleged violation of the
statutory act fixing the maximum rate for the transpor
taton of passengers at 2 cents per mile that the South
ern Railway had previously encountered somewhat SIM
liar conditions in North Carolina and perhaps in Georgia
other States that October 1907 the representatives
of the Southern Railway Alabama Great Southern and
Mobile Ohio entered into contract with the then Gov
ernor of Alabama to reduce rates under certain
conditions of which the dsmssing of the tiga
ton or withdrawing cancellation of its license to transact
business another the by the then Governor
that the Railroad Commission of Alabama should permit
the raising of certain rates commodities it, after
trial. they found to be too low also guaranteeing
that right interests of the said railroads should be
affected by legislation to be enacted at extra session
of the Legislature held preceding the next regular session.
and relieving the companies from any penalties thereto
fore incurred by alleged violation of the laws
Forced Reductions Hurtful
We are told that in oden times governing officials hav
ing despoc needing money, forced contributions
from wealthy victims by pulling their teeth until they
complied but not advised that the victims en-
joyed and think may conclude that notwithstand
ing the apparent cheerful acquescence in the enforced
ducton in the rates of transportation of from
maximum of cents to maximum of 21a cents, of the
roads in Alabama is not conclusive evidence that they
believe the interests they have been promoted
by such enforced action.
However, be that may the conditions under which
the Louisville Nashville operates in Alabama vary
greatly from those of other railroads The Louisville
Nashville is the only in Alabama that has reck
lessy invested capital in the building of branch roads
roads which only local or inrastae traffic is moved
Nearly 70 per cent of the mileage operated by the Louis
vile & Nashville Railroad Company is branch ntra-
state lines All other railroads in Alabama handle their
ntrastate traffic lines mainly devoted to interstate
or through traffic and in it may be said that
their ntrastate local traffic incidental to their other
business but the Louisville Nashville is operating
y one million passenger train miles per on branch
lines wholly dependent for the local travel
will readily be that the losses that may be incurred
by other roads may be materially less than of the Louis
vile Nashville and the reduction may therefore, to
them not be serious matter but it s shown vital
to the Louisville Nashville.
Much Business Done at Loss.
It udcialy established that the ntrastate passenger
traffic Of the Louisville Nashville Railroad in Alabama
is done at heavy oss that is that the derived
is sufficient pay the cost of expenses and
very tte any, return upon the capital invested But
the plea is made that the Louisville Nashville Rail-
road Companys entire traffic has, during the past few
years, been profitable it should, and be compelled
to transport business in Alabama at oss The State OF
Alabama not justly require that the earnings Of the
Louisville & Nashville Railroad in other States or earn
ings derived from interstate tracthat is traffic pass
ing between points in two more States-De appro
priated to pay losses resulting from moving traffic be-
tween points within the State at unremuneratve rates
The laws of the country prohibit such action by any
State the law construed and will be SO enforced
by the courts Such is the law and it ought to be the
law the State Of Alabama require the carriers to
transport persons property between points within the
State at oss Tennessee Kentucky and other States may
do So resulting general and sweeping reductions OF all
the ntrastate rates. which in turn will force the reduc
tion of interstate rates. and bankruptcy will result
am well aware that it is exceedingly embarrassing for
an editor acknowledge that he has erred and that
few will do so but hope have made it clear that your
statement that the involved in the hafcent low
er rate is trife comparatively That great system
readily afford the loss," is erroneous.
May 23, 1918. MILTON H. SMITH.