The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1914-12-05
CRAVEST CRISIS IN
HISTORY CONFRONTS
AMERICAN RAILWAYS
WAR HAS CLOSED FINANCIAL MARKETS
OF EUROPE TO THEM INDEFINITELY.

4 cation for an increase in passenger
rates before the State Public Utilities
Commission, it is their desire to util-
lie this occasion for an intimate and
frank discussion of the whole railroad
question with the people Of the 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 broadmindedness is a
byword 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-lncreasing
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 foreign
money markets, has suddenly brought
them face to face with situation
which threatens not merely many new
receiverships, but the actual paralysis
of the entire transportation Industry
of the nation. 1t was this state OF
affairs which compelled the closing of
the New York Stock Exchange some
months ago. What will happen when
it opens only the future can tell.
American railroads are valued in
round figures at twenty billion dollars,
and of this vast sum nearly five bill
lion dollars worth of securities are
held abroad. Should Europe, in its
frantic struggle for funds, seek to
convert these securities into ready
gold when the Stock Exchange opens.
as it did before it closed, where are
the railroads to get the money with
which to buy them? And if they
haven't the money, what demoraliza-
ton will follow not merely In railroad
, securities, but in all other great Amer
lean industrial values as well?
PRESIDENT WILSON'S VIEWS.
That the situation is profoundly
serious is manifested by the recent ut
terance 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
~, y,
ible of governmental agencies, and 1
am glad to do so. because 1 think the
need is very real.
They are indispensable to our
whole economic life, and railway Sc
curities are at the very heart of most
investments, large and small, public
and private, by individuals and by in
sstitutions.
Il 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
+ WneTG
there is manifest common interest we
ought all of us to speak out in its
behalf, and I am glad to join you in
calling attention to it. This is the
time for all to stand together in united
effort to comprehend every interest
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 $780,
100000 less than for the previous
year. The gross earnings for the year
were $44,000,OO0 less than for 1919
while expenses and taxes were $76,-
100000 more. But heavy as this bur-
den was before, the great struggle
across the seas, carrying in it's wake
the destruction of untold hundreds OF
millions of dollars worth of all kinds
of property, renders the situation &
thousandfold more serious. 1t means
In sort, that for number of years Il
come Europe will have no surplu,
money for investment in the United
( States or elsewhere, and that Ameri
can railroads will have to financ,
their future needs at home. How
! Herculean this task will be. savin,
nothing about protecting themselve
s. against the dumping of foreign securi
ties, may be judged from the fact tina
the bond and note obligations which
will mature between now and the en-
of next year and which the railroad
will have to meet in some way amour
to more than 63,O0O.0OO-and thi
doesn't take dollars worth Of ney
Improvements or betterments int
consideration. These are obligation
which were incurred in the past an
which must be met as they fall duo ;