The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-04-03
Commerce Board Decides on
Quick Action After
Hearing Him.
MAY BE VERDICT MAY !
Pennsylvania's President
Says Company's Surplus
Is Diminishing.
RETURNS ARE INADEQUATE
lie Declares Country Will Suffer
il Railroads Are to BE
Crippled.
RETURNS ARE INADEQUATE

GOOD authority that the commission had
, decided to expedite the main case of the
carriers petitioning for an increase In
freight rates Of per cent. and to hand
down q decision at the earliest possib BILE
date An announcement to that effec,
i-obcbly will be made Tomorrow
, morning.
TIE earrierv now expect . decision on
TITS Sis issue By May I.
That the commission will expedite by
eliminating collateral questions IL indi-
Gated by these Developments:
Ths commission has indefinitely past
pensd the argument In regard TO the spot
! ting and switching OF cars. testimony
upon which b completed: II has indea-
niteiy postponed the taking Of testimony
IN connection with lighterage In New
York harbor and other collateral Issues
which grew out Of the proceedinss ins,i.
tuted by the commission Itself and no,
cat Of the application Of the carriers for
IN Increase.
In addition to this the commission by
failure to enact has apparently rejected
TIE request Of Louis ID. Brandeis It's
! counsel. to be allowed TO examine the
four railroad presidents who have teeti.
ned as to how money obtained from pres.
ent rates was spent.
shippers attorneys who are attending
the hearings expressed themselves as
Thoroughly satisfied to have the commits.
sion close the main case at once and
allow the collateral Issues to 90 over To-,
later hearing and argument
The railroads will make a formal mn.
non Tomorrow for the closing of the case
early next week. The railroad ATTORNEYS
will agree 10 rest the case upon the suh-
mission Of briefs and without oral arxu.
ment.
Mr.. Rca's Cancellations,
samuel Rea. president OF the Penn.yi-
vania sys,-m formally closed the case ~
the railroads late this afternoon. III,
statement was regarded by many 70 he
the strongest made ny any % the ra,,ro,d
presidents. President Rea drew the fol-
lowing conclusions fror, the conditions
confronting the great Pennsylvania sys-
tenn: 80
9Th" marcin 81 surp'us Il steasuv A.
mi"ishinc and the company Is not re-
eeivine any return either on the addition n,
capital Invested or for the va',r OF the
service rendered aud the facilities pro-
vided for pnb,ic use.
~Hsd there been no aurp,ns 4, ra-ior
years and hal the whole Of the Improve
news been paid for ont Of can,'n, the
marPin would now have reached the van
fshirc point.
TT surplus steadily decreases inr-ove
ments. II made at all will more and more
need TO be made out ~ ne~ capi'aI. hu,
" the margin OF safety decreases new
capital will only be raised with greater
oinlculty ana on more oncrous terms
Indeed u Is questionable whether n
new capital IL 70 continue 20 en-n M
income. the directors will he ius,lf.i In
attempting TO raise more than n modlc,l,,
81 what they believe necessary as .hs
enect must he 70 reduce the ne~car., 90
return on the shareholders capital already
invested"
The Pennsylvania Position.
Here are some Of the other things tina,
me president OF the Pennsylvania told the
commission:
''The position OF the Pcnrsviyani, Raj.
road system is not so strong az II was
We nave In more PROSPEROUS times giver
TO the public a good share In our pros
perity.
I'VE desire to continue to live M to a
high standard or public service. bu,
whether we can do 80 or not denends or
the decision OF this commission.
"Whhont fair returns from rrasona h's
S1tes we cannot irdure the Uub'ic 20 fur.
nish adequate capital for the public re-
euiremrnfs Along our system except al
hieh interest rates.
"t'nloss the gap between recain,s ,,d
expenditures can be widened We must he.
En to retrench. and retrenchment mus,
DegIn on betterments and improvements
not directly necessary to the movement
Of trains
I'VE should be very reluctant TO do this
~ II would he IN run counter to our ira
ditlons and practice OF hair a century
and we are sure that II would rot be in
the public interest and we do not be.
lieve the public desire H.
NOW we have as much public support
A. can possibly be given 10 n plea Almost
national IN its scope and effect, and We
firmly believe our application for q verv
moderate freight rate Increase is In ac-
cord with the best public interest
II would not create the impression that
per cent. rate advance Is necessary Ii
the maintenance OF the Pennsy lvana Rail-
road Compa ny's dividends In the Immediate
future, although II II cannot he obtained
" may be necessary for the company 10
curtail the necessary provision to preserve
that high standard which the public has
grown to expect from II.
Not Getting Adequate Return.
THE facts. | believe. will show that the
pennsylvania Railroad IL not earnin, an
adequate or reasonable return on tho PC
fual money expended for lie railroad ana
equipment or Tor the value u the service
rendered and the facilities furnished
ANY general Idea that the pennsvi.
vania Railroad Compam's position is 20
strong as not 10 need any additional rev.
cnue is not correct. because only 4St ucr
cent was earned On the money invested
In the railroad and equipment o. the i, mn
sylvan!. Railroad Company and the linop
east OF pttsbuig directly operated ,y /;
during the year ended June 80. lgl3
'rhe property Investment account n,
vn- system, as I havr s'atrd. iucrensed
In the last ten wears $500 O00. 900: of This
about sass 600 900 We're provided OUT %,
the new cnu,tal and SlHi, 600 GOA out o.
surplus. This expenditure on the eyster
IN this period was not for an expans or
or Its territory, but primarily for lnten,
aiva development.
. On the property investment OF IN,
oHt're rystsnh the net operating incom.
rronnred 7,N per cent In 1909. IN ne,
-