The Washington herald., 1914-03-06

Ben b. Cain, vice president and gen.
eral manager, Gulf, Texas and Western
Railway Company:
You correctly say there is no question
| confronting this country which Is quite
| so vital as granting to the railroads an
increase In freight rates. This applies not
only to the Eastern lines. but Is more
essential to the prosperity of those lines
! struggling for existence In the more
| sparsely settled sections of the country.
Data compiled by the American Railway
Association, which I have reason to be-
\ lieve is reliable. shows that 81 l-2 cents
| of every dollar earned by the steam
| roads OF the United States has to be
| expended In keeping the roads going
| there being only sl-2 cents with which
to pay dividends and make improve
| ments. The distribution OF dollar
earned by the common carriers is as fol-
lows:
where the Earnings Go.
Labor. ALI cents: fuel and oil. S.s3:
material. supplies, and miscellaneous ex-
pense. 1906: loss and damage. 30; taxes.
Al: rents and leases, Al: interest on
debt. 1913. and dividends and improve
! ments, S59.
Within the past month railroads OF
commission for an increase OF Is per
cent in the freight rates. but our cum
mission refuses to even consider the ap-
plication, Notwithstanding II was based
upon facts which IL true undoubtedly
warranted an increase.
/ quote from an appeal addressed to
the people Of Texas by the general man
ayers as follows:
Appeal 10 Texans.
Your tax commission. created by you,
and acting under their oaths OF Office,
has found that the true value of the
railroads of Texas is $1,000 per mile. We
believe they are of greater value. Ac-
cOrding TO table No. TO- page 40 OF the
Twenty-first Annual Report of the Rail-
road Commission for the year 1872. the
total cost OF the construction and equip
ment of the Texas railroads up to June
%. 1912. was S5S2, 3SS 9i9. which shows that
the roads have cost their owners a little
over S3s.0oO per mile. But, taking $4,000
per mile, which the tax board says Is
the true value OF the roads. as a basis.
the railroads of this State, for the year
ended June %. 1910. earned 40 per cent
on that value. For the year ended June
90 1911. they earned 4IS per cent: for the
year ended June 90 1912. they earned al
per cent and for the year ended June 30
1918. they earned 3g7 per cent. Out Of
these earnings the companies must pay
the interest on their bonds and other in
debtedness. and il 1t is not sufficient they
are forced to borrow the money. or de-
fault in interest payments. For the year
ended June 30. 1912. the shortage amount
ed TO a little over $4,000: for the year
ended June l3. 1918, the shortage amount
ed to something over sI.600Oo0. And for
the first FIVE months OF the year begin
ming July /. 1872 the railroads are over
a. 600 O00 behind what they were at the
end OF the corresponding five months of
the year beginning July /. 1872. so that
IL they break even for the balance of
the year their deficit foT the year ended
June 30 1914. will he nearly 6,01.Oo0,
However. they cannot hope to break
even because the month of December.
with its disastrous floods and loss of
business has not yet been taken into ac-
count.
Reduced to the Linsit.
I'VE are anxious to continue to give the
people at least as good service as hereto
fore: in fact. We want to improve that
service but II Is apparent that we can
not do so unless We can obtain more
money from the operation of the roads.
We have reduced operating expenses all
we can. Further reductions of expenses
must come. IL at all. by the help Of the
people, the legislature, the courts and the
juries.
The crisis has been reached where We
must have more money. or else be unable
to give the people adequate, safe and
reasonable service. Poor service natural
" gives rise to bitter complaints, and as
your servants, we believe you are entitled