The labor journal. [volume] (Everett, Wash.) 1909-1976, 1917-08-03

ownership advocates throughout the
country are being organized for a
concerted drive in support of a
bill for government operation of
the railroads, drafted by Frederick
c. Howe, Commissioner of Immi-
grafton for the Port of New York,
about to be introduced in Con-
gress.
The bill creates the United States
Railway Corporation, with a board
of eleven directors, of whom six
would be appointed by the President
and five designated by the railroads
of the country. This corporation
would operate all railroads, paying
to the stockholders the average rate
of interest and dividend payments
received during the last ten years.
The balance remaining after paying
operating expenses and providing a
depreciation and maintenance fund
would provide permanent improve
ments and extensions, and the sur
plus would then go into a sinking
funding for the purchase of tn
properties and securities.
A saving in transportation cost
of more than billion dollars a
year is claimed for the bill.
Copies of the bill have been sent
to all members of Congress, accom-
panied by letter from Mr.. Howe
pointing out the need OF govern
ment action to meet the breakdown
of the country's transportation fa-
cilities.
A memorandum accompanying the
bill says in part:
"The purpose of this proposal is
to place the railroads of the nation
in the hands of corporation, like
the Federal Shipping Board, to op-
crate them in trust and pay for them
out of earnings, and to secure for
the nation the advantage of govern
ment ownership under the form of
an operating corporation.
"Under the proposal the objections
to government ownership are elm
mated. The following advantages
will Immediately accrue:
"The railroads become in effect
government property Immediately,
without waiting for prolonged con-
troversy as to the basis of valua-
ton, payment, etc. All these ques-
tions may be deferred until after. the
war. e..
"The railroads will be operated as
a unit. The waste of two hundred
odd separate railroads, each strug-
Cling for traffic with useless COM
petition, car shortage, terminal con-
gestion, ETC., will be open to i'm
mediate correction.
"The economies from such CONSOLE
dation will be colossal Terminals
could be consolidated. Cars could
be operated at full capacity. The
struggle for freight business by COM
peting roads would be eliminated.
The savings from increased efficiency
and elimination of wastage would
probably run into the hundreds of
millions of dollars. Thousands Of
law departments could be dispensed
with. Millions could be saved in the
financing of security issues, from
commissions, interest upon deposits
and other sources. Hundreds of
boards of directors could be dispensed
with, as well as thousands of high
salaried officers. Ultimately there
could be a reduction Of from $780,
100000 to $40O.0OO,O00 year in
interest charges, for the government
can secure money at three and one
half per cent interest.
Freight rates would be immedi-
ately simplified. Millions of use
less complicated rates and charges
could be ended. Very simple classi-
fications that would be understood by
anybody, like those that pevail
abroad, could be substituted.
"The net earnings Of the railroads
in 1916 amounted to over billion
dollars. In addition, over $780,
100000 in new income through in
creased rates is being demanded.
Any surplus, which might. amount to
a billion of dollars, would go to
the government.
millions of dollars now disbursed
for the Interstate Commerce Com
mission, and state railroad commits
sions for endless litigation would be
saved.
"In addition, and Iris is probably
the greatest economy of all, the
railroads are being enriched year