Imperial Valley press., 1917-01-02

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 eountry's busi-
ness the national government would
be compelled to take over the owner
ship OF the lines with all the evils at
| teudant upon such system.
Preservation of Composition.
Mr.. Bryan, on the other hand, holds
that the further extension OF federal
authority over the railroads would be
a step In the direction Of government
ownership. He advanced the view that
ths Capitalization Of control in the
hands of the national government
would impose toe great burden upon
the regulating body, would offer strong
temptation to railroads TO interfere Ia
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
he believed that the preservation OF
competition was the test to be applied
to all cancellations.
Regulation of Securities.
Mr.. Bryan declared himself in favor
Of national regulation OF railway stock
and bond issues, but added that he saw
No reason why that should exclude the
states from acting ON the same sub
ject as to state corporations. Il would
like to see the stock Of railroad, ~
long as 1t is In private bands, made a.
substantial and as unvarytng as tho
value of a government bond" he as
| serted.
He suggested that railroad capdtali-
zation be resdjusted to eQualize it with
actual valuation of the property rep
resented, making due allowance for
equities. and that when this was done
the roads should be allowed 10 earn
sufficient income to keep their stock
at par and to create a surplus. The
latter, he tentatively proposed, might
bc allowed TO amount to Is per cent
of the capital.
Railway EarnInee Low.
This subject of railroad capitalization
and the amount Of railroad earnings
received further attention from the
committee during its recent sessions.
In answer to questions BY Senator
Cummins, Mr.. Thorn submitted figures
showing the net earnings of the roads
In recent years. These figures show
that during the Eve years from 19Oo
to 1910 the average net earnings we've
5,o per cent af the net calitaliseti ton.
while for the five years from 1910 to
1915 tho average was only 4.5e per
cent. The total earnings on the stock,
computed by adding to the net oper-
ating income the income from the se-
curities owned and deducting bond in
terest, were for 1910, 7.09 per cent;
for 1911, GIT per cent; for 1912, 497
per cent; for 1918, 5.94 per cent; for
1914, 4.O6 per cent; for 1915, 8.44 pei
cent, thus showing an almost contin-
uous decrease throughout this six year
| period. 1t was announced that Hal
ford Erickson, formerly chairman OF
| the Wisconsin Railroad Commission
| would submit more complete informa
| ton on this subject to the Committee
at later date.