The Liberal democrat. [volume] (Liberal, Kan.) 1911-1924, 1914-12-04

rates DSIOre lHe oldle IuDllC OlliltiSo
Commission, it is their desire to utll-
ize this occasion of the whole railroad
question with the people of this state.
To this end, the careful attention of
the reader is invited to a series OF
articles which will appear in this
newspaper during the next few
weeks. All that is asked is that the
people of Kansas, whose broadmind-
edness is a by-word throughout the
country, do the railroads the justice
to listen to their side Of the story
and then form such conclusions as
they think the facts warrant.
That the railroads of the United
States are today confronted by the
gravest crisis in their history there is
not the slightest question. For some
years they have been desperately
struggling with an ever-lncreaslng
cost of operation in the face of re-
duced freight and passenger rates
but serious as this situation was be-
fore, the European war, which has
indefinitely closed to them the for
eign money markets, has suddenly
brought them face to face with a
situation which threatens not merely
many new receiverships, but the ac-
tual paralysis of the entire transpor-
! tation industry of the nation. II
was this state of affairs which com
| PEELED the closing of the New York
| Stock Exchange some months ago.
What will happen when 1t opens only
the future can tell. American rail-
roads are valued in round figures at
twenty billion dollars, and of this
vast sum nearly five billion dollars
worth of securities are held abroad.
| Should Europe, in its frantic strug-
gle for funds, seek to convert these
securities into ready gold when the
Stock Exchange opens, as it did be-
fore it closed, where are the railroads
to get the money with which to buy
them? And if they haven't the
money. what decentralization will fol-
low not merely in railroad securities,
but in all other great American in
dustrial values as well?
President Wilson'S Views
That the situation is profoundly
serious Is manifested by the recent
utterance OF President Wilson to a
group of Eastern railroad executives.
In his letter to Mr.. Trumbull of the
Chesapeake & Ohio he said:
you ask me to call the attention
of the country to the imperative need
that railway credits be sustained and
the railroads helped in every possible
way, whether by private cooperative
effort or by the action wherever feas-
ible of governmental agencies, and l
am glad to do so, because think the
need is very real.
They are indispensable to our
whole economic life, and railway Sc
curitles are at the very heart of most
investments, large and small, public
and private, by individuals and by
institutions.
81 am confident there will be earn
est and active cooperation in this
matter, perhaps the one common in
terest of our whole industrial life.
Undoubtedly men, both in and out
of official position. will appreciate
what is involved and lend their aid
heartily wherever it is possible for
them TO lend it. But the emergency
is in fact extraordinary and where
there is manifest common interest we
ought all of us to speak out in its
behalf, and | am glad to join you In
calling attention to it, This Is the
time for all to stand together in unit
ed effort to comprehend every inter-
est and serve and sustain It in every
legitimate way"
Railroads Lost Millions
The net operating income of the
railroads of the United States for the
year ending June 80, 1914, was
| $4,000, 900 less than for the pre-.
vious year. The gross earnings for
the year were $44,OO0,O00 less than
| for 1913-while expenses and taxes
were /$76, 100000 more. But heavy
as this burden was before, the great
struggle across the seas, carrying in
| its wake the destruction of untold
hundreds of millions of dollars
worth of all kinds of property, rem
ders the situation a thousandfold
more serious. 1t means, in short,
that for a number of years to come
Europe will have no surplus money
for investment in the United States
or elsewhere, and that American rail-
roads will have to finance their fu-
ture needs at home. How Herculean
| this task will be, saying nothing
about protecting themselves against
the dumping of foreign securities,
may be judged from the fact that
the bond and note obligations which
will mature between now and the
end OF next year and which the rail-
roads will have to meet in some
way amount to more than $563,O00,-
O00-and this doesn't take a dollars
worth of new Improvements or bet
terments into consideration. These
are obligations which we're incurred
in the past and which must be met
as they fall due If the transportation
companies are to be preserved from
wholesale receiverships and ruin.
Manifestly, therefore, American
investors, big and little, will have to
come to the rescue-and before they
will consent to do this American
railroad securities will have to be re-
established as a sound, respected and
paying investment-and this, on the
basis of present railroad earnings, is
impossible.