The sun. [volume] (New York [N.Y.]) 1833-1916, 1915-06-24
WESTERN LINES END
RATE INCREASE PLEA
Request for Advance Justified,
They Say, to Make Needed
Improvements.
CONVENTIONS ARE DENIED

WARRINGTON, June 23-Areument
was finished to-day before the Interstate
Commerce Commission on the proposed
increases in Western freight rates on
grain and Its products. The statement
wac made that these increases alone IL
allowed will amount to more than S1o.-
100000 a year.
The chief arguments made to-day
were by r. j. Norton OF the Santa lee
Railroad. who spoke for the forty-onc
petitioning lines. and A. F.. Helm. COM
merce counsel OF the railroad commits
sion Of Kansas.
Mr.. Norton Justified the increases on
the necessity for getting additional rev.
enue to make needed improvements de-
manded by the public. He said that
from 1901 to 1914 the ratio OF labor
compensation to total operating revenue
has increased on the forty-one systems
Is Der cent. and that the ratio OF taxes
to revenue In 1901 was 80 per cent. and
in 1918 &C per cent, an increase Of
about ~ per cent.
ION the forty-one roads the net in
come in 1914 over 1907-s was 'suffi-
Client to yield a return OF only IL per
cent. on an additional. investment OF
SI,070, 00O. 900. and for t~wenty-six Sc
lected railroads the per cent. was less
than / per cent" Mr.. Norton asserted.
Calls Net Income Too Low.
'The net income on tho systems is
barely sufficient to pay a reasonable re-
turn on an investment OF $4,000 a
mile, which Is far below the actual value
or cost OF the lines.
THE issues of securities from 1901 to
1914 have been running more and more
largely to bonds instead of stock. the
capitalization OF the forty-one lines In
1901 beins 46.3 per cent. stock and o3.1
bonds, while in 1914 only 31.1 per cent.
OF the capitalization was stock and 62.3
per cent. bonds. This shows a very un-
desirable condition. The carriers are
constantly descending into debt Instead
Of receiving copartners as stockholders.
n cost to railways OF borrowed
money has increased. TIL reduced value
of railway stocks in later years makes
for another additional cost OF money to
the carriers"
Mr.. Norton said that the rates or
grain anu gram pIouuSls taSN VI 'he
Missouri River. owing to competitive
and other conditions, are unduly low
and not so high as they should be In
comparison with rates allowed In central
freight territory. where the tonnage is
four times as dense as In the western
territory.
Mr.. Helm said there was nothing in
the testimony showing that II costs the
carriers more money to handle this
grain.
Tells Of Railroad Looting.
1.-THE commission has no control over
the expenditures Of the railroads." con-
tinued Mr.. Helm. land is not response
bic for financial transactions In whicf
the railroads lose money. II a road
has been ~mismanaged or its treasury
looted by dishonest officials, as has beer
shown. they appear to think that al
they have to 10 is to get together. grour
their affairs. the yea with the strong
and say Let's get more money
'The proposition In this case 10 &c
rave the strong roads bear the burdens
of the weaker and better managed ones
! do not see o the commission car
maintain such a thing"
Mr.. Helm created a STIR when he de
clared that the proposed increase or
grain and grain products alone would
net the carriers more a $40. 900, 00(
annually. This is the amount the car
riers estimate the increases on the
fUalya commodities inyolyed will nro