Putnam patriot. [volume] (Putnam, Conn.) 1872-1962, 1916-12-15

Federal Regulation Should Not Be Al.
lowed to Exclude Exercise of Stat.
Authority. He Contends-Thinks Rail.
road Stocks Should Represent Actual
Value and Be Stable as Cover nment
Bonds.
Washington. Dec. II. - William ],
Bryan. who startled the country ten
years ago by advocating government
ownership of railroads, appeared be-
fore the Newlands Joint Committee on
Interstate Commerce last week in sup.
port Of the claim that the states should
Toe allowed to retain authority over the
regulation OF all transportation lines
within their borders. Mr.. Bryan ex.
planned that he had long regarded gov.
eminent ownership as inevitable. but
only because of railroad opposition to
effective regulation.
Against Government Ownership.
Personally | cannot say that de-
sire government ownership" he ex-
planned. because | lean to the indi-
viduai idea rather than to the colIec-
tive idea; that is. | believe that gov
eminent ownership is desirable only
where competition is impossible"
Alfred Z. Thorn. counsel to the Rail
way Executives Advisory Committee
previously had presented before the
members of the Newands Committee
Ms one of his reasons for urging bet
ter balanced and more systematic reg
ulation of railroads the argument that
rhis is the only alternative to govern
ment ownership Calling attention to
the restrictions imposed upon the
transportation lines by conflicting state
laws aud regulations, to the practical
cessation of new construction and to the
impossibility under existing conditions
of securing the new capital needed for
extensions and betterments of railway
facilities. he warned the Congressman
that unless they provided a fair and
reasonable system OF regulation that
would enable the railroads to meet the
growing needs of the country's bust
ness the national government would
he compelled to take over the owner
shin of the lines with all the evils at
tendant upon such system.
Preservation Of Composition.
MIR. Bryan. on the other hand. holds
that the further extension of federa
authority over the railroads would N
step tn the direction OF government
ownership. He advanced the view that
the Capitalization OF control In the
hands of the national government
would impose too great burden upon
the regulating body. would offer strong
temptation to railroads to Interfere IN
politics and would encourage the gen
eral movement toward Capitalization
of power in the federal government at
the expense of the states. He said that
he did not object to consultations OF
railroad lines SO long as they did NOT
destroy competition. that he knew OF
no COMPLAINT against great railway
systems because of their size and that
ne believed that the preservation OF
competition was the test to be appiied
TO all consultations.
REGULATION Of Securities.
Mfr Rrvsu declared himself in favor
of national regulation OF railway STOCK
and bond issues. but added that ne saw
no reason why that should exclude the
states from acting on the same sub
iect as to state corporations. u would
ike 70 see the stock of a railroad. as
long as it is in private hands. MADE as
sn,1stantiaI aud as unvarying as the
yalue of a government bond" be as
serted.
He suggested that railroad capitah-
zatien be readiusted TO equaiize II with
actual valuation of the property rep
resented. making due allowance Tor
EQUITIES and that when this was done
tbe roads should be allowed TO earn
sufficient income to keep their STOCK
at par and to create a surplus lhe
latter. he tentatively proposed. might
be allowed to amount to - per cent
of the capital
Railway Earnings Low.
This subject of railroad capitalization
and the amount of railroad earnings
received iuibLdA
committee during lis recent sessions
In answer to. questions by Senator
cpmmins. Mr. Thorn submitted figure
showing the net earnings Of the roads
in recent years These figures show
that during the five years from lhl
~ 1910 the average net earnings Were
% DER ceat of the net capitalization
while for the FIVE years from 1910 Z.
1915 the average was only 4.5' pei
cent The total earnings on the stock
computed by adding 10 the net oper-
attn. income the income from the Sc
rurifies owned and deductlng bond IN
terest. were for 1910. To5 per cent:
for 1911. 6.l7 per cent: for 1872 All
..ar cent: for 1913. a.94 per cent. for
1914. 4os per cent; for laia 81 per
cent thus showing an almost eontin
mons decrease throughout this six year
period Ii was announced that Hal
ford Erickson. formerly chairman OF
rhe wisconsin Railroad Commission
would submit more complete informa-
tion on this subject to the Committee
aara