The Washington times., 1916-02-06

ties the demand for which emanates
principally at present from the countries
| encRged IN the European war. but these
constitute a comparatively small Dcr-
cehtake Of the grand total
The building trades are likewise ex-
pettncing most pronounced re-
coverY; mines are busy and obtaining
high prices for their products steel
plants are turning out the largest
product on record. for which they are
ueh andinE and receiving abnormally
nigh prices. and textile mills are enjoy
ing period of prosperity that exceeds
any record for many years.
Whhe railroads are showing satisfac-
tory increases in both gross and net
earnings with each succeeding month,
the wage problem has again arisen aud
now hangs like a cloud over the trans-
portation INDUSTRY OF the country
Fhat the transportation problem Is
one OF the most important questions
confronting the country is demonstrate
ed through the fact that 1t is receiving
the serious consideration Of the leading
legislators of the nation.
Senator Underwood I'm an address
Friday before the American Electric
Railway Association at Chicago said:
There Is no more important question
people that awaits proper solution than
the settlement along just and economic
lines OF the vexed problems Of trans
portation."
Turning then to the recent suggestion
OF President Wilson in n message to
Congress that a commission be created
TO investigate all the problems that con-
front the country in the tield of trans
portaion, Mr.. Underwood gave his in
depreciation Of the purpose OF the pro-
posed investigation. remarking:
"It is not to hold an inquest on what
has happened in the past II errors
have been committed or injuries have
been done, that Is question for the
courts and not question Of legis-
lation. The real purpose to be ac-
complished by the INVESTIGATION is TO
the farmer, the merchant, those direct
ly engaged in transportation, the In
terState Commerce Commission and the
railroad managers to appear before n
committee of Congress- ana state their
views in reference to the solution of
this great problem with the view In
mind that in the counsel of many We
shall fnd wisdom to guide our legisla-
tive course"
Mr.. Underwood declared that II the
transportation systems of the country
cannot be successfully regulated the
people will demand that the legislators
move forward to Government owner
II think a step in that direction would
be most unfortunate, said Mr.. UndeT-
wood. "It would lead to many evils
that we dream not of today 70 avold
which we must work out 3 satisfactory
system OF Government regulation, Dotn
for those engaged in the shipment or
fTeIghts and those who have their
money invested in the means OF trans
portation."
Mr.. Underwood deplored the division
OF authority over railroads as exercised
by the Federal Government and the
individual States. and. touching on the
question OF railroad financing. In the
course Of which he showed the higher
rates now charged for moneys bor-
rowed by the railroads. Mr.. Underwood
said: ,.. -.
the transportation companies must pay
In the end you must get the money TO
meet the increases either by tho re-
duction of wages. the curtailment OF
on the passengers and shippers OF
freight.
practically speaking. the last alterna-
tive is the one we must adopt. Where
transportation company placed its
bonds at 4 per cent interest twenty
years ago. and renews them today at
per cent. so far as the public Is con-
cerned It is identically the same as II
the company had increased its bonded
Indebtedness by one-half at the old rate
20 benefit whatever from the increased
charge.
at is. therefore. necessary in the solu-
ton of the problem before us in the in
terest OF the public. even more so than
in the interest OF invested capital. that
the credit of our transportation companies
should be so good that they can secure
the capital for their present mainten-
ance and their future development at
the lowest possible charge.
"'There NAV be many reasons TO aC-
count for the changed status of rail-
road securities as investments in recent
years. You may say that It Is due to
adverse legislation that has alarmed
the Investing public Whether the Iegis-
lation has been unwise and ill-consid-
cred. or whether II has been Just and
fair. there can be no question that the
investing public has become alarmed
as to the solvency Of railroad securities
1t Is also true that recent legislation Of
Congress eXempting State and munich
pal bonds from national taxation has
invited capital into that field of invest
ment. Again II Is true that the past
generation regarded Industrial securities
as a more or less speculative invest
mont. but the development of the great
industries of our country today along
safe and conservative lines has opened
a field ~ the use of capital at higher
| rates of interest than the transportation
companies of America can afford 20 pay
because there Is no governmental limita-
ton on the prof1tS that can be made In
| industry and there Is a hard and fast
| limitation. fixed by law. on the earning
| capacity Of railroad securities.
THE opening of new fields for in
vestment has taken away from the
| transportation lines much Of the market
they enjoyed for their securities in the
| past.
THE rates Of taxation have increased
in every State of the Union. Wages
| have gone up. The cost of equipment
and supplies have greatly increased. II
1t had not been for economic manage
| ment. many of the railroads that are