The Richmond palladium and sun-telegram. [volume] (Richmond, Ind.) 1907-1939, 1917-12-27
GOVERNMENT
TO CUT PAY
OF RAILROAD
EXECUTIVES
More Money for Workers
Promised as One of First
Acts of New Federal Con-
troll.
M'AD00 IS THE CHIEF

WASHINGTON, Dec. 27-One of the
first acts Of the government in be.
ginning operations of railroads will be
to reduce large salaries now paid to
the railway executives and increase in
some measure the wages of the rail-
way workers.
Securities to be issued while the
government Is ir control will be at
interest rates not less than 4 percent
and the issues will be made under
Joint authority OF the director general
and the interstate commerce commits
sion.
President Wilson, when he outlines
the government plans in his forthcom-
ing address to congress, will ask that
the government be empowered to buy
quantity of new railroad securities.
All earnings over and above an
amount to be agreed upon will go to
the government.
To Get Rolling Stock.
Congress will be asked also to ap-
pTopriate a large fund probably $780,
coo, for the immediate supply OF roll
ing stock to handle the flood Of traffic
which has swamped the roads.
The director general will have au,
thority to decide whether the govern.
ment shall also assume operation and
control OF the express companies.
Control Of the railroads. to bring
about uniform operation for the war.
will be assumed at noon tomorrow,
with Secretary McAdoo, still retaining
his cabinet post. in charge as director
general Of railroads.
This decision, the governments so.
luton for the difficulties of the pres
ent transportation situation, was an
nounced last night IN Q proclamation
by President Wilson, effective at noon
Friday, Dec. 2s, and taking over every
railroad engaged in general transpor-
tation in cont tai United States,
with it's APP tenances. including
steamship lines. All lines will be
operated as single system under
Director McAdoo.
In statement issued with the for
NAL proclamation, President Wilson
declared he would ask congress as
soon as it reassembled for legislation
guaranteeing:
In Good Repair.
"First-That the railroad properties
will be maintained during the period
OF federal control in as good repair
and as complete equipment as when
taken over by the government, and
second, that the roads shall receive
a net operating income equal in each
case to the average income, net. Of
the three years preceding June 30
1917"
Railroad officials will retain direct
management of the roads, and the
railroad war board. composed of five
railroad heads, will continue actual
operation under Director McAdoo's
supervision.
The Presidents action, taken
through Secretary Of War Baker
under authority of the army appro-
priation act Of August. 1916, came as
surprise at this time, as it was be-
lieved he would await the reassem-
bling Of congress and make known his
decision in an address to that body.
Had Been Forecast.
Eventual government control Of rail-
roads had been forecast, however, |
since the interstate commerce COM
mission, in special report to con.
gressfi recommended either govern !
ment operation or repeal Of the anti |
pooling laws, and a federal loan. /
Commissioner McChord. in a supple.
mentary report, declared for outright |
government control as the only solu-
ton, and many congressional leaders |
recently have concured in this |
opinion.
The Presidents statement made
clear that his decision was not due i
to any failure of the railroads to per.
form their duty as we'll as they could
under present legal restrictions. and |
the real reason for the plan Of govern
ment operation was TO permit com.
plete unification of all rail systems, !
impossible through private operation |
by statutes prohibiting pooling of
traffic and earnings.
The committee of railroad execu-
(continued on Page Eighth