The Washington herald., 1916-07-24
Aid for Railroads.


than few weeks ahead attaches any great
significance to the increased earnings which
have resulted from the munitions prosperity. The
surplus of one fat year easily be eaten
up by the deficits in two or three lean years
Nobody can predict the effect of the eight-hour-
day negotiation expenses, even if unorganized
railway labor did not still have to be dealt with.
What gives for confidence in an ultimate
Improvement is not the industrial boom, but the
manifest willingness of politicians to consider
ways and means for putting the railroads per-
manently on their feet
Congress has authorized joint subcommittee
to inquire into the whole question of railway
regulation and report next January. This project
came in nonpartisan, unanimous reports from both
Senate and House committees. The only men,
tion OF railroads in the national Republican plat
form is declaration for increasing the scope Of
Federal regulation. The Democratic platform
does not deal with the railroad question: but it is
the Democratic administration which has been
promoting the Congressional inquiry and the rail-
roads made it clear early as last February that
in case the inquiry undertaken they would
advocate compulsory Federal incorporation, Fed
eral regulation of security issues Federal regula
ton of rates where they affect interstate COM
merce and, in Short Federal regulation of what
ever is not distnctivey State. From such legis-
laton the saving to the railroads and hence ulti-
mately to the public that pays the tolls is ex-
pected to be substantial and meantime, as one Of
the railroad lawyers has shrewdy put it, the
people of each State will be protected against
the authorities of other States who might other
wise seek undue advantages
The program contains certain other features
One is designed to give the Interstate Commerce
Commission competent auxares in administra-
uon throughout the country. Shippers are dis
contented because cases which they regard as
important practically decided by examiners
who have official status appropriate to the
performance OF such functions; and they complain
that adjudication drags and is expensive To
meet this situation it is proposed to establish
regional subcommssions composed Of Presden-
ual apPontees, confirmed by the Senate, having
permanent offices in the locality which they
will serve and having authority to make orders
which will be final unless appealed to the Inter
state Commerce Commission. 1t is predicted that
one Of the sources OF appointees to the sub
commissions will be the State commits sions whose
members generally receive salaries smaller than
those which Congress is likely to fix for Federal
subcommissoncrs
The other leading improvement which a large
number of business organizations have advocated
IS declaration by statute that it is the policy
OF the government to permit such systems of
rates as will yield the roads earnings sufficient
to attract investment for Improvements and ex-
tensions. Some of the commissioners dissented
and others reluctantly granted the Eastern freight
rate advance, permitted explicitly because the
roads needed more money. Later in the Western
case the commission declined to find whether the
roads needed more revenue not. This attitude
IS based on the conviction that the present law
gives the commission power to consider the
rates as a whole or the effects of rates upon the
financial condition OF the properties The pro-
posed provision would dcvove that duty explic-
lily upon the commission. 1t is pointed out that
this policy would not mean that -located i'll
managed or overCapitalized roads would have rates
raised to a point where they could thrive and
grow and where other roads would have need
lessly large earnings, since the commission al
ways deals with large-scalc rate cases by strik-
ing an average Of all the roads of region.
George A. Post, president of the Railway Busi-
ness Association, the national organization of
equipment manufacturers, in a speech before the
New York State Bankers Association, said that
Congress by such provision would in effect an
nounce this rule: 'If you fail on rates which
enable the average road to live and prosper, YOU
ought to fail, and the government will not protect
you against failure; if rates under which the
average road can live and prosper, you can earn
large dividends, your right is to earn them, it is
in the public interest that you should earn them,
and the government will protect you in their en-
joymcnt"