The Oakes times., 1916-12-14
Ae'pfu'ness andEncourassment
Urged by Alfred P. 1hom.
CREDIT ..vs1 &c IMPROVED
Increase Of Transportation Facilitie,
Necessary TO Secure Relief From
High Cost Of Living May Thu. Be
Provided For by the Railroads.

""''" "" '"Hst"'iINc principles OI
hclpfulncss and encouragement instead
of upon principles of repression and
punishment, was urged by Alfred T.,
Thorn. counsel for the Railway Excrl-
tivcs' Advisory Committee. the first
witness on behalf of the railroads he.
fore the Newlnn'ls Joint Committee on
Interstate Commerce. which has insti-
tutcd u general inquiry into the prob
lens of railroad regulation.
ut Is proposed Icy the joint rcsolu.
tion Of Congress- said Mr. Thorn, ito
go into n comprehensive study of the
whole subject Of TRANSFORMATION. TO
make u new assessment. after 20 years
OF experiment. Of It's history. its pres
ent conditions and It's future needs.
The railroads accept the view that reg
ulatiOl Is n permanent and enduring
part Of government In America and
that the first duty Of the carriers is tu
the public. That duty Ia to afford
reasonable facilities on reasonable
terms aud mt reasonable rates. and this
must !" done before any private inter.
csts can l'c considered"
Certainty. Safety and sufficieney.
Mr.. Thorn colItrntlcd TINT the real I'm.
tcrcst of the public is in being assured
OF certainty. safety aud suilcicucy of
trnnsl'orihti"n facilities. rather than I'm
rates. The first consideration of IN"
public Is to obtain transportation fucili.
ties. Whit the cost Is. is In reality u
second consideration he said.
MIR. Thorn proposed an increase OF
transportation facilities as method
of securing relief from the high cost
of living. '"rhcrc have been less than
1000 miles of new railrond construct.
ed IN the United States during the past
year.. hc said. less than in any year
since lSlS, except the period OF the
Civil War. and yet the cost of living IL
daily advancing owing to Il shortage of
supplies which might he rclncdicd by
securing access to new areas Of pro-
duction
Credit Must BE Improved.
This leads to the consideration ns to
| whether railroad credit is as good as
the public interest requires. 1t is i'm
possible for railroads to earn enough
to supply the necessary new facilities
from current revenue. They must lie
provided from credit Investors can-
not be cocrce,l. but must be attracted"
Among the conditions affecting rail-
road credit which deter investors lie
mentioned the following:
First. Railroad revenues are not
controlled by investors. but are fixed
and limited by governmental authority
and not ly one but by several govern
mental authorities. which do not rcco.-
nizc responsibility for assured results
% investors and are uncOordinatcd
Second. Railroads cannot control
and the government cannot and does
not limit the expense account.
Third. The present system Of rcgu.
lntion Is based on policy of rcgu'atio
and correction and not on a policy Of
helpfulness and encouragement
Fourth. Th" outstanding obligations
Of the railroads have already exceeded
the financial rule OF safety and involve
n diSprOpOrtionatc amount of Obli.a.
tiOns hearing fixed charges.
Fifth. The investor must accept a
subordinate obligation or security with
no assurance Of n surplus of earnings
to support 1t.
sixth. Other competitive lines of in.
vestrnent present superior attractions.
seventh. The railroad business is
largely controlled by political instead
OF business considerations.
Look Forward, Not Back.
I'VE may debate about what has
caused the present conditions" said
Mr.. Thorn. but we cannot debate about
what the people need. The President
has taken the view that we must look
forward in this matter and make a
fresh assessment Of circumstances in
order to deal helpfully and Intelligent
ly with the problem. Abuses are
no more prevalent in the railroad b,lsi-
ness today than In any other business
humanely conducted. The great qucs-
tion now Is whether the existing sys-
tenn OF regulation gives the public re.
liable assurance OF sufficient present
and future railroad facilities
Those VIII" oppose any change must
make their appeal on the ground that
the present systems assure the public
OF the continued adequacy of trans
portntion facilities II they do not. no
argument based ON the dcSirabiliiy OF
:hc present dual system of regulation
will bc accepted by public judgment.
The question of states rights is not
involved. II the regulation of tranSpor.
'ntton facilities privately owned should
iail government ownership must FOL.
low. and then all power OF the states
over the railroads would disappear.
LET us debate this question. then.
not upon any mere theory or jcaionsy
as to the distribution of governmental
power. but upon the large issue OF
what the public interest requires in
respect of the assurance OF adequate
transportation service