Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1914-04-28

ties generally are actually earning less
net after paying operating expenses and
taxes, thanA they were earning at the be-
ginning of the period and before the $685.
s62, coo had been spent.
The result, as might be expected, of
this constant tendency toward diminish
ing net returns has been to seriously
check. if not altogether stop. the normal
development of railroad facilities in the
territory affected.
g 1T is a mistake to think that the
problem is merely question of dividends
to railroad stockholders. The problem
in broad and true sense affects all in
terests'
UNLESS the railroads are permitted to
increase their revenues by reasonable
increase in the rates for transportation
services so as TO help meet the large
and permanent increases in the cost of
capital, wages, taxes and other expenses,
then it will be only a question of time
when there will result not merely the re-
duction or suspension of dividends. but
also, in some cases at least. a default
in the payment of interest and other obi
cations.
Total suspension of dividends by all
the railroads though it would produce
great panic. would not produce the
amount of rev capital required"
Brandeis' Brief Filed
Louis D. Brandeis, special counsel for
the commission tonight filed his brief in
opposition to the proposed increase. He
maintains that by conserving the rev.
enues properly derivable under the exist
ing rates the railroads viii be confronted
with no necessity for an advance. 1t has
been shown. he said, that the aggregate
freight revenues of Eastern carriers in
1913 was 81, 10000 and that the per cent.
advance would increase the revenue
about 100000 year.
at is true" said the brief, that rail-
road taxes have increased largely in re-
cent years, but the increase has been
general in all business, and the ratio or
railroad taxes to gross revenues is still
small Railroads have. in common with
other businesses, been necessarily affect
ed by increasing rates of interest gener-
ally prevailing in recent years. But it
must be remembered that interest rates
fall as well as rise and we appear to
nave entSTtd a pCiiON ~ NSSAiAA'b
Mr.. Brandeis suggested that many rail-
roads had strained their credit by "un-
due expansion in financing the New
Haven. Boston & Maine, 'Fristo Lines,
Rock Island and Pere Marquette. He
argued that the increase in the several
clements of cost of operation of railroads
did not account for the inability of the
companies to earn adequate profits at eX-
listing rates, and that the general scale
of wages on railroads mad not increased
more than in other businesses
OF the per cent. advance Mr.. Bran
des said:
at would intensity existing injustice
and discrimination in rates 1t WOULD
give additional revenues where relief Is
not needed and would fail to give ade-
ouate revenue to carriers who are most
in need of relief. The prosperous coal
carrying roads would have their revenues
largely increased. Other roads, less pros
porous, would get much smaller addi-
ton to their revenues.
s1The investigations already made make
it clear that by conservation, net rev.
enues may oe largely and speedily in
creased and that the sources available
would WELD revenues far in excess or
the $50 100000 which 1t was proposed to
raise by tariffs fled