The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-03-30
Hard Times and tho Case Of tho
Railroads.

Hard Times and tho Case Of the
Railroads.
Next TO agriculture the greatest in
dustry in the United States Is rail
reading. In the country's transporta
ton system. with 100000 miles Of track
and an investment Of fully $1S.OOO.OOO..
600 Of capital, Is most strikingly ex'
pressed the American genius for eco
nomlc expansion. Railroad develop
ment has been the peculiar contribu.
ton Of the United States to the ma.
terial progress Of the race. Nowhere
else in the world have the science and
art Of moving passengers and goods BY
rail been carried to such q pitch Of
perfection.
Next also to agriculture railroad en-.
terprise has been the greatest single
factor in American prosperity. Indeed
It IL not too much to say that railroad
extension has transcribed every other
influence In Its stimulus to prosperous
activity. Yet to-day there Is an ap-
palling public Indifference to the dan.
ger which threatens the whole business
fabric Of the United States as the re-
suit Of an overloaded political tend.
ency to subject the railroads to an OBJ
pressive degree OF governmental regu.
lation which practically constitutes de.
NAL Of the right Of private capital to n
living wage.
Very recently there have been hope
full signs Of a public awakening TO the
disaster which impends II the railroad
factor In American prosperity is elm.
mated: but II II a question II there Is
an adequate public appreciation Of the
real crisis. DO American citizens under.
stand what Is meant by the accounts
which are being published daily Of re-
duction Of working forces on the rail.
roads and curtailment Of train service
Statements Of falling earnings may
seem only matter Of bookkeeping con.
Germ to stockholders. commonly thought
Of rs rich persons who can AFFORD de.
crease Of income. How about the 49,
600 employees who have been laid Of
on the New York Central and Pennsyl.
vania lines alone In the last four
months, with every certainty that in u
few weeks the number will be in.
creased? How about the trains which
have been dropped from schedulesI
Are not these facts which strike
home the truth that hard times have
come again In the United States and
that they have come to stay a long
while unless the railroad situat ton Is
relieved in the manner asked by the
Eastern carriers In their supplication
to the Interstate Commerce Commits
sion for permission to make an average
advance Of o per cent. In their freight
rates? Is the lesson Of hard times
going to be needed before 1t Is under.
stood what issues of economic life and
death are involved In this matter of
freight rate advances? DO the Ameri-
can people court disaster. or do they
fail to comprehend the situation?
1t has been shown to the Interstate
Commerce Commission that thirty five
railroads, the principal petitioners in
the Eastern rate case have since 1910
added s659OOO.OOO to their property
investment. Last year after paying
operating expenses and taxes their net
earnings were $16.3l 600 less than In
1910, although their gross earnings
were Sls6.775.OOO greater. They not
only earned nothing on the new CAPT.
tai sunk in the three year period. which
at a reasonable rate Of return should
have yielded about $32 100000 asst
year, but they obtained diminished
return on their investment as II was In
1910. How long can It he supposed
that private capital will 60 into the
railroads under such circumstances?
How long will 1t stay there?
Who wants to put money into a los.
ing venture? The railroads are today
losing venture unless their future
contains more assurance OF profit than
politics has been willing TO vouchsafe
In recent years. Where Is the money
to come from to build the 100000 add.
tlouHl Ihlits oI Truck WHICH Will Or
needed in the next generation? Not
only must there be more mileage. with
Its incidental increase Of labor and
equipment, but the whole railroad sys-
TEN has to be rebuilt and replaced
every 40 often. Where Ia the money
coming from to do it?
In the Eastern rate case II has been
shown that railroad dividends Of late
years have averaged small frac.
ton over per cent. Returns on
capital invested in manufacturing en-
terprisc of corresponding Importance
have been more than twice that Some
thing like &0,OOO,OOO.OOO Of Investment
Is represented In the bonds, notes and
stock Of the Eastern lines. This money
came from the public. How much more
will come from the public II investors
can Nee ahead OF them only shrinking
returns and an increasing certainty
that the railroads will not be permitted
to earn adequate wages on invested
capital? There Is tremendous CONNIE.