New-York tribune., 1917-05-25
Railroads Asking
Higher Rate Admit
Gain il, Earnings
Shippers Seek to Show AL
legged Emergency Doesn't
Affect Every Line

Washington, May 24.-Railroad ex.
ecutivcs from widely separated Sec
tons OF the country appeared to-day at
the Interstate Commerce Commission
hearings on the carriers petition for
a 10 per cent advance in freight rates.
They were cross-examined by counsel
for shippers.
The shippers representative probed
into the finances Of the railroads, try
ing to get the executives to say that
the emergency the railroads say ex-
lists does not affect every line.
T. C.. Powell, vice-president Of the
Queen e. Crescent, in response to ques-
tioning said that last week his COM
pany declared a regular dividend of 8
per cent on the common stock and an
extra dividend of 3ls per cent.
you claim an emergency exists"
said the questioner. "If that is so
why have you seen fit to further de-
plete the funds Of your road by de-
claring an extra dividend"
Mr.. Powell said the dividend was re-
garded by the directors as a duty to
the stockholders.
Henry Walters, chairman of the
board Of the Atlantic Coast Line. was
asked how much stock Of the Louis
Vile & Nashville his line controlled.
He replied that it was more than so
per cent. II was a fact, he said, that
the increase in net revenue Of the At
lantic Coast Line was greater during
the first three months of this year than
in the corresponding period Of 1916,
but additional expenses which the road
must stand did not show in the reports.
Mr.. Walters added that while there
was no doubt that the net revenues Of
the line would be larger this year than
last. they would not be sufficient to
meet the increased costs.
The witness said the accumulated
surplus Of the Atlantic Coast Line was
about $40 900 900, Of which s20,000,00o
was in cash, and Of that sum $4,000.
900 had been appropriated. He agreed
with the examiner that the partial pur-
pose Of a surplus was to tide railroads
over lean years and meet emergencies.
an view Of the fact that you con-
troll through stock ownership at least
81 per cent of the stock Of the Louis
willie & Nashville. would it not be prac-
ticable, in order to meet the existing
situation and in view Of the fact that
the louisville & Nashville earned 19
per cent last year, to have that line
pay you more dividends ?" Mr.. Walters
was asked.
"We have never undertaken to con-
troll the Louisville & Nashville" he re.
piled.
Howard Elliott, Of the New Haven,
and member of the Railroad War
Board, told Clifford W. Thorne, repre-
senting shippers, that he favored some
scheme of pooling cars and terminals
should it be necessary in the interests
Of national defence. He also believed
it desirable that a government agency
be created to tell the railroads just
what was desired Of them.
He was questioned regarding economy
suggestions issued by the War Board.
These proposed speeding up repairs on
locomotives and cars, increasing the
running time Of locomotives, reducing
boiler repairs and more careful steam
ing.
Mr.. Elliott said that up to certain
point the suggestions did not contem-
plate any additions to capital. He said
the War Board felt that II everything
suggested could be done the capacity OF
the railroads would be greatly. in
creased, but he did not believe all the
things could be accomplished.
Mr.. Thorne introduced figures he
said were compiled by the government,
showing that the Southern Pacific owns
one-twentieth of all the privately
owned timberlands in the country.
julius Kruttschnitt, chairman Of the
Southern Pacific, said it was true that
the Southern PaciAc's return on its
capival stock last year was slightly
over IL per cent and the greatest re-
turn in its history.