Brownsville herald. [volume] (Brownsville, Tex.) 1910-current, 1913-04-04
.BRANDEIS ON
THE RAILROADS
THE PEOPLES LAWYER" WHO
SAID HE COULD SAVE RAIL.
ROADS MILLIONS A DAY. CHAM
PIONS LA TOILETTE BILL.
SAYS PHYSICAL VALUATION is
GREAT STEP TOWARD PKACTI-
CAL AND ECONOMIC MANAGE
MENT OF GREAT SYSTEMS.

BOSTON, Mass, April 4.-Louis ID.
Brandeis, the peoples lawyer who
once declared he could save the rail
roads Of this country millions of dol
lars every day, in statement written
for the United Press, today championed
Senator LaFOllette's act providing for
the physical valuation of railroads by
the Interstate Commerce Commission.
He insisted that before the people can
know whether the money they pay to
railroads is honestly and necessarily
spent, interlocking directorates must be
abolished and federal bureau Of rail
road costs established.
Mr. Brandeis charges that J. p. Nor
gan K company and other bankers have
monopoly OF selling to many railroads
The money they need at rates of the
bankers own fixing
BY LOUIS ID. BRANDEIS.
The La Toilette Act providing for the
Interstate Commerce Commission, is a
great step forward. The senator's seven
year fight has been nobly won. The Act
is but another application of La Fol
iettes favOrite mOttO-"Ye shall know
the truth, and the truth shall make you
free"
Everybody admits that the value Of
railroad property is one Of the elements
TO be taken into consideration by the In
terstate Commerce Commission i'm fixing
rates, and everybody has been obliged
to admit that the Commission was with
out reliable data bearing upon this val
ne Under the La Toilette Act the pub
lie will at least be furnished with the
best evidence of value available.
But there is more truth which must
be known before LaFollettc's task of Sc
curing to the people Just railroad rates
is completed. To secure reasonable rates
other steps must be taken We must
know besides the actual value of rail
road property. the actual cost Of opera
ton and of current construction an0
and the cost of current construction and
of new equipment The railroad reports
give us now statement Of what they
spend each year; but the public has no
means of knowing whether this amount
has been well spent
In the calendar year 1912 the railroads
collected from the American people in
gross earnings. $3.0i5,77S.327. most OF
which has been spent i'm some way.
About Onethrd Of that amount has gone
in interest and dividends and taxes. The
physical valuation would help us to
know what part of that interest end div
idend is paid on capital which is water
About two-thirds of the years revenues
is paid out for operating expenses. 1t is
at least equally important to know what
part of that revenue has been spent un
necessarily: what part has been wasted
through dishonesty, and what part
through inefficicncy Besides the $1,000
100000 of current revenues spent i'm Oh.
Grafton. there are each year expended
hundreds of millions in new construc-
ton Of the purchase of equipment. What
part of the money spent for new con
struction or equipment is efficiently and
honestly spent? Until we know all this,
we cannot know whether rates are just
and reasonable
The fact that railroad company has
paid out money has ceased to be assur-
ance that it was necessarily paid out.
interlocking directorates may have led
to the making Of many contracts unnec.
cSSarily burdenSOmc to the railroads.
for on many of our railroads interlOck
ing directorates control large part Of
the expenditure. -