Evening star., 1916-12-27
FAIR RAILROAD RATES
OR FEDERAL CONTROL
One or the Other Inevitable, Accord
ing to Railway Business
Association.

NEW YORK, December 27.-Unless
railroad rates are adjusted to make
revenues conform proportionately to
try's railroads is inevitable, according
to the annual report of the general
executive committee of the Railway
Business Association.
IF total revenues are not made ade-
quate to total expenses" the report
states. mo question will long remain
as between federal and state authority,
because sooner or later the federal
government under those conditions
must take over the roads. In that
case the states would lose all voice
whatever and federal regulation, if
any, would present the grotesque
vising another whose tenure proceeds
from the same source Of power as his
own. Whoever omts from his prescrip-
tion statutory obligation upon the com
mission to permit rates adequate to
carry the national business and de-
velop the country leaves out the essen
tial ingredients without which the
whole compound is futile.
Additional Elements Proposed.
"The present law" the report points
out, declares that each rate shall be
just, reasonable and non-discrimina-
tory. 1t is our purpose to recommend
that two additional elements be en-
bodied in the statutory rule:
81. That in regulating rates total
revenues shall be permitted sufficient
for total legitimate purposes.
"2. That legitimate purposes shall
embrace the attraction of investment
for improvements and extensions.
I'VE yield to none in favoring ef-
fective federal supervision under con-
ditions advantageous to the whole pub
lie, while insuring that the states may
retain such jurisdiction as local self
government requires; but at the same
time we emphasize this aspect
Every substantial increase in tonnage
miles of road were constructed in the
calendar year 1915, and apparently the
record for 1916 will barely exceed that
figure, although the volume of industrial
activity, and hence railway earnings. is
considerably greater than in any previous
year Those who deal with investors con-
tinue as for several years past to report
Indifference of their clients toward rail
way securities. except for refunding and
for mortgage bonds, now rarely feasible,
upon unencumbered property.
Conducted on High Plane.
I'VE approve abstention by legislative
bodies from dealing with rates. We see
no exception even in so costly an item as
the eght-hour law. The new legislation
which we urge is that if at any time in
any place rate advances should become
necessary in the public interest author
a will
explicitly reside by statute in a specified
branch of the government.
1.-THE public interest-that is, the yard
stick proposed by the railroad leaders for
measuring the provisions which they ad-
vocate. Responding in kind. members of
the Newlands committee have rvaIed one
another in keeping the discussion at that
high level. Commercial organizations
having membership in forty-eight states
have transmitted to us declarations for a
unified regulation where state regulation
conflicts with federal. More than sixty
such bodies have urged that the statute
proclaim adequate earnings the policy of
the government. These suggestions at
Washington and throughout the Union
we hail as a bow of PROMISE as the token
of a factor destined to work for pros
perity in the future, affordng in all years
an adequate instrument of commerce and
in lean years a purchasing power tending
to mitigate industrial distress
Meanwhile the conference committee
of railroad managers met here TODAY to
discuss the situation preparatory to a
joint meeting tomorrow with the brother
hood chiefs