The Washington herald., 1914-10-30
Injustice to the Railroads.

] mlusnce 10 the kaikoadS.
The continuous attacks upon railroads. and the
marked falling of of net earnings, has caused the
public to consider the condition OF the Transportation
of our country and its effects upon business pener.
ally writes Gen. Granville NJ. Dodge in the National
Magazine Public opinion, through the Legislative
has made the public believe that immense amounts
have been stolen that the railroads have been over
capitalized and that they make unusual profits in
which there IS no truth
! The enemies of railroads take two or three roads
and apply their action, where bad judgment has been
used. to all the roads, whereas il you look at any
business, you will nd that time there is often
bad judgment used in conducting their business or
large sums made In promoting it but one applies
that to all business.
! Again. criticisms the roads are made for trans
actions back in 1900 where there were excessive
amounts raised to extend the railroad lines over un-
developed country, and for the promoting of many
propositions that were not profitable At that time
the craze for development was almost universal
while now they try to compare transactions of that
date with conditions existing now from ten thir-
teen years after the fact instead of conditions exist
ing at the time of the transactions, (which to any
fair mind show how unfair such comparisons are
One of the most common assertions is that rail-
roads are over-capitalized. The total mileage of
railroads, including siding switches terminals etc.
IN 1912 was 3oo7I424 miles, and it capitalized
at. about S42ooo per mile. This simple statement
shows that the roads would be valued at more than
this sum, and could not be replaced for anything
near il. .........
Since 1896 the price of all material used by the
railroads. the wages OF all It's employees nave risen
from 80 to 90 per cent in some cases 100 per cent
while the rates upon all traffic have decreased until
now it is only about six mills per ton per mile Is
there any other business in this country that prices
have not gone up with the increase of cost? This
condition has caused the net earnings of railroads
TO steadily decrease in their ability to meet the largely
increased interest.
In 1913 the total earnings of the roads, as COM
piled in Washington, was S3o75,IIz2 an increase
over 1912 of 37-Io per cent The total operating
expenses were ST. ISo5o3o3o decrease from 1912 of
$40 per cent and the seven months from June 20,
1915 to February !, 1914 the decrease in net reve
IL per cent showing continuous decrease
for the months of this fiscal year. and with the
depression of business upon u.s. insures that this
decrease will continue. The fact is that since 1900
sum equal to one-haf of the capitalization of the
railroads has been added to their cost great portion
OF which has added l cent to their net revenue,
while the interest that great has had to be
made from year to year.
The railroad system of the United States pays the
highest wages in the world pays more taxes in pro-
portion to invested capital than the railroads of any
other land. 1t not only does more work on its cap-
tai but it does this work upon less capital than any
railroad system in any other country.
The fact is owner manager of railroads or
any of their departments, have the control or
mana cement of his road department such other
or private industrial concerns or ndivd
of operation of railroads The Interstate Commerce
Commission fixes the rates. The hours Of labor and
wages paid fixed by labor organizations, backed
by Congress, and the policy OF the roads is controlled
to a great extent by State legislatures and State
1t is mistaken idea that railroads are owned and
controlled by few capitalists. The stockholders of
railroads have increased yearly, until roads
have as high as 100000 stockholders and as long as
the roads prosper the stockholders increase but now
under the present condition there is halt; all in
are frightened and within the last few years
the ability of railroads obtain capital has decreased
until they are forced issue shortterm notes in
stead of long term bonds and pay per cent or more
interest," besides a large commission, instead OF to
per cent on twenty-five to fifty year bonds.
There are 100000 employees on American rail-
-oads with their families they represent 7I-2 per
,ent of our population. The buying and consuming
power which the railroads by their disburse
nents to their employees is enormous. Direct pur-
hases of material by railroads make vast contri-
,uton to the countrys total value OF business, and
very person can see what detriment it is TO the
business to cause the railroads be forced to halt
n their improvements and extensions. causing
rave decrease of their earnings. And this is one
# the principal OF the present depression in
BUSINESS.
In the hearings before the Interstate Commerce
Commission it did for a time that before the
airoads are granted right what they earn, they
must show themselves to be per cent honest and
90 per cent efficient This is a request with which
10 corporation individual comply as long as
usiness is conducted by frail humanity