New-York tribune., 1917-12-10
The Future of the Railroads

II is fortunate al around that the
problem Of the railroads has become
clearly a military problem. II was all the
time as much military problem as 1t
was an economic one. But the Interstate
Commerce Commission never was able TO
see that. Congress was never able to see
il. either. In fact, in the state OF mind
in which Congress has been for the last
couple Of decades nothing could have
gotten more on its nerves than a sugges-
ton that our transportation system ought
10 be unified, inyigorated and fostered as
matter of rational military policy.
Congress desired 10 keep the railroads
IN politics-tO curry favor with the
granger public by continually pounding
the carriers and beating down freight
iates, actually and relatively. at the cost
Of railroad efficiency. 1t was safe and
easy form Of emGgogy-practised IN each
state Legislature as well as at the Capt
tol in Washington. But it was bound to
prove expensive in the long run; forsit
could not but result in Gripping the roads
and steadily reducing the value of the
services which they could offer the coun-
trv in q time of national emergency.
Neither Congress nor the executive
branch Of the government looked ahead
SO even up 70 a year ago such a travesty
on intelligent legislation as the passage of
the Adamson act was possible. 1t was
rot only possible, but it represented the
single view-the easy-going, vote-making,
when-in-doubt-p play ay-the-labor-unions and
he-grangers-ag against-the-railroadS view,
hich the great majority Of public men
we're capable Of taking.
The war has uncovered the folly Of
most Of Washington's pre-war conceptions.
Facing realities, the loudest former adyo-
Gates of sham regulation and demagogic
oppression are stricken dumb. Just be-
fore Congress met, Judge William {.
Adamson, the author Of the spurious
"eight-hour" law Of September, 1916. gave
out an interview on the railroad situation
which might almost have come from the
mouth Of a railroad lawyer pleading for
equitable treatment before the Interstate
Commerce Commission. Here are some
things which Mr. AGamson said;
High enough rates should be fixed by the
Interstate Commerce Commission To In
sure dividends 20 every line. strong and
weak. Then for tie stronger roads an
excess profits tax should be devised which
would take about 80 per cent OF their
surplus IN excess of certain verv fair
profit. The other half they could keep as
an incentive 20 maintaining ctdc.cncy.
The weaker roads should be further
aided by direct loans from the national
government, based on their securities as
collateral In a very short time these two
policies would restore the public's conf
dence in the securities Of the smaller roads
aud money, which is their CHIEF need could
be obtained.
When the chairman Of the House Com
rittee on Interstate and Foreign Com
merce, the man who took the lead year
ago in voting wage increase to the four
railroad brotherhoods while refusing to
allow the overburdened railroads TO in
crease their rates sufficiently to make
good the wage advances, talks thus about
sustaining and befriending the carriers, it
IS easy to see that even Congress is be
ginning to readjust its ideas and prac-
tees TO war actualities.
The object which the government now
has in view in its treatment of the rail
road problem is not to cater to ancient
Granger prejudices, but TO win the war.
Ii il is to develop our transportation sys-
lem 20 full military efficiency it must
either lend the carriers about $lOOOOOO,-
600 or. taking over the roads, must spend
that sum on them directly out Of the
Treasury. If it merely assumes direction
OF transportation as a military expedient
i cannot avoid allowing the railroads 70
make q living-to earn dividends at least
In 70 the per cent limit at which Con-
oress has declared that excess profits
f-r corporations begin. 1t is allowing the
uest packers 9 per cent profit, and in
other industries il tolerates vastly greater
nrotits. The average return of the rail-
loads is now little below 6 per cent.
The government will therefore have to
sanction general increases in freight and
nsssengcr rates as first step toward
sslf-supporting operation on the part OF
ne carriers.
II is easy 20 understand. under these
circumstances, why the sgitators in Con-
gress who were formerly all for govern
mental ownership and operation of the rail
roads (on basis of semi-conhscation which
would enable rates TO be kept down where
,hev are) are now only half-hearted about
IN experiment Of that sort. II rates are
% no raised, these statesmen prefer TO re-
ain the opportunity 70 charge the raises
,y as usual, to the extoriions OF private
wnership. e..
But call them whatever you wili' IN