The Washington times., 1916-02-06

ties the demand for which emanates
principally at present from the countries
encaged In the European war. but these
constitute comparatively small per
cehtaGe Of the grand total.
1he building trades are likewise ex-
pen,ncing most pronounced re-
coNerS; mines are busy and obtaining
high prices for their products: steel
| plants are turning out the largest
product on record. for which they are
deh anding and receiving abnormally
hieh prices. and textile mills are enjoy
ing period of prosperity that exceeds
any record for many years.
Nhlle railroads are showing satisfac-
tory increases in both gross and net
earnings with each succeeding month";
the wage problem has again arisen and
now hangs like cloud over the trans-
portation INDUSTRY of the country
Ihat the transportation problem is
one OF the most important questions
confronting the country is demonstraI-
ed through the fact that it is receiving
the serious consideration of the leading
legislators of the nation.
Senator Underwood in an address
Friday before the American Electric
Railway Association at Chicago said
There is no more important question
now pending before the American
people that awaits proper solution than
the settlement along just and economic
lines of the vexcd problems OF trans
portation."
Turning then to the recent suggestion
of President Wilson in message to
Congress that n commission be created
20 investigate all the problems that con-
front the country in the neld of trans
portaion. Mr. Underwood gave his in
depreciation of the purpose Of the pro-
posed investigation. remarking:
1T Is not to hold an inquest on what
has happened in the past. II errors
have been committed or injuries have
courts and not a question OF legis-
lation. The real purpose to be ac-
complished by the investigation Is 10
give an opportunity for all concerned-
the farmer. the merchant, those direct
ly engaged In transportation. the In
terstate Commerce Commission and the
railroad managers to appear betore u
committee Of Congress and state their
views in reference to the solution 1f
this great problem with the view In
mind that in the counsel Of many We
shall fnd wisdom to guide our leG,sia-
tive course"
transportation systems of the country
cannot be successfully regulated the
people will demand that the legislators
move forward to Government owner
II think step in that direction would
be most unfortunate" said Mr.. Under
wood. 1T would lead to many eviis
that we dream not of today; TO AVOID
which we must work out satisfactory
sy stem Of Government regulation. both
for those engaged in the shipment or
freights and those who have their
money invested in the means of trans
portation.'
Mr.. Underwood dcp1ored 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:
''If you increase the interest rates
the transportation companies must pay
In the end you must get the money 70
meet the increases either by tho re
duction Of wages. the curtaliment OF
IA cilities, or by an additional charge
on the passengers and shippers or
freight.
practically speaking. the last alterna-
tive Is the one we must adopt Where
a TRANSPORTATION company placed It's
bonds at per cent interest twenty
wears ago and renews them today at
s per cent SO far as the public is con-
ccrned It Is identiCally the same as II
the company had increased its bonded
Indebtedness hv one-half at the old rate
20 benefit whatever from the increased
charge.
at is. therefore. necessary in the solu-
tion 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 reasoDa m ac-
count for the changed status of rail-
road securities as Investments in recent
years. You NAV say that II Is due to
adverse legislation that has alarmed
lation has been unwise and ill-consid-
cred. or whether it has been Just and
fair. there can be no question that the
investing public has become alarmed
al to the solvencv 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
| mcnt but the development of the great
industries of our country today along
safe and conservative lines has opened
| field - the use of capital at higher
rates Of interest than the transportation
companies of America can afford 10 pay
because there is no governmental limita :
| ton on the profits 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
TRANSFORMATION 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
| It had not been for economic manage
ment. many of the railroads that are