Catoctin clarion. [volume] (Mechanicstown, Md.) 1871-1940, 1916-11-30
new POLICY NEEDED
IN GOV ERN N MENT
RAILWAY CONTROL
Relpfu|neSS andEncouragemsnt
Urged by Alfred P. Thorn.
CREDIT MUST Be IMPROVED


Necessary to Secure Relief From
High Cost Of Living May Thus Be
Provided For by the Railroads.
Washington, Nov. 2S.-A new policy
OF government railroad regulation.
based on constructive principles Of
helpfulness and encouragement instead
of upon principles of repression and
punishment, was urged by Alfred i.
Thorn, counsel for the Railway Execu.
tives' Advisory Committee, the first
witness on behalf of the railroads be-
fore the Newlands Joint Committee on
Interstate Commerce, which has insti-
tuted a general inquiry into the prob
lens of railroad regulation.
at is proposed by the joint resolu-
ton of Congress-" said Mr.. Thorn, Ito
60 into comprehensive study Of the
whole subject of transportation, to
make new assessment, after 20 years
Of experiment, of its history, its pres
ent conditions and its future needs.
The railroads accept the view that reg
ulation Is permanent and enduring
part OF government in America and
that the first duty of the carriers Is to
the public That duty is to afford
reasonable facilities on reasonable
terms and at reasonable rates, and this
must be done before any private inter-
eStS can he considered"
Certainty, Safety and Sufficency.
Thnn a1 ~ hnt bn In,
tereSt of the public is in being assured
Of certainty, safety and sutticiency of
transportation facilities. rather than I'm
rates. The sfrst consideration Of the
public is to obtain transportation facili-
ties. What the cost is, is IN reality a
second consideration he said.
Mr. Thorn proposed an increase Of
transportation facilities as method
Of securing relief from the high cost
Of living. There have been less than
Loco miles of new railroad construct
ed In the United States during the past
year." he said, less than IN any year
since 1913, except the period Of the
Civil War; and yet the cost of living Is
daily advancing owing to a shortage Of
supplies which might be remedied by
securing access to new areas OF pro-
duction.
Credit Must Be Improved.
This leads to the consideration as 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 be
provided from credit. Investors cam
not be cocrced, but must be attracted"
Among the conditions affecting rail
road credit which deter investors he
mentioned the following:
First. Railroad revenues are not
controlled by investors. but are fixed
and limited by governmental authority
and not by one but by several govern
mental authorities which do not recog-
nize responsibility for assured results
to investors and are uncoordinated
Second, Railroads cannot control
and the government cannot and does
not limit the expense account.
Third, The present system Of regu-
lation is based on policy of regulation
and correction and not on policy OF
helpfulness and encouragement.
Fourth, The outstanding obligations
OF the railroads have already exceeded
the financial rule of safety and involve
disproportionate amount of obliga-
tions bearing fixed charges.
"Fifth. The investor must accept
subordinate obligation or security with
no assurance Of a surplus Of earnings
to support 1t.
sixth, Other competitive lines Of In
vestment present superior attractions.
Seventh, The railroad business IS
largely controlled by political instead
of business considerations.
Look Forward, Not Back.
1--WE 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 busi-
ness today than iii any other business
humanely conducted. The great ques-
tiOn now IS whether the existing Sys-
tenn Of regulation gives the public re-
liable assurance of sufficient present
and future railroad facilities.
"Those who oppose any change must
make their appeal on the ground that
the present systems assure the public
Of the continued adequacy Of trans
portation facilities. If they do not, no
argument based on the desirabilty of
the present dual system of regulation.
will be accepted by public judgment.
The question Of states rights is not
involved, If the regulation of transpor-
tation facilities privately owned should
fail 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 jealousy
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"