New-York tribune., 1917-06-22
Government Loan
Of S2OO,OOO,OOO to
Railroads Sought
Equipment Interests Sug'
gest Expenditure of That
Sum for Freight Cars

A plan involving the granting Dy tne
United States government of loan OF
5000. 900 900 to the railroads of the
country, the money 70 be used TO
finance the purchase OF the 100000
freight cars urgently needed to relieve
the shortage of rolling stock, it was
learned here yesterday, will be laid
before the proper officials at Washing
ton by one of the leading interests in
the railway equipment industry.
A representative Of this equipment
company, in discussing the proposal,
said that a loan of this amount on a
81 per cent basis would go a long
way toward solving the car shortage
difficulty. 1t was pointed out that as
matters now stand the railroads are
not in a position to Sorrow on favor
able interest basis the S200,000,000 re-
ouired to finance the building of the
cars. In the event that the government
should adopt this plan it is stated that
an arrangement could be made whereby
the railroads could pay back the loan
by laying aside certain amount out
of the per diem earnings of each of the
100000 cars.
Government May Build Cars
II is expected that the railroads Will
eventually get the equipment, either by
the government having the cars built
COR itself and renting them out TO the
roads or through the medium OF the
suggested S2OO,OOO,OOO loan.
In the event that the orders for loO,-
600 freight cars are placed at once, the
manufacturers say they are in posi-
ton to turn out the finished product,
ready for use. by January next. pro-
vided that steel and other materials
can be obtained and delivered on time.
The extent to which the industries
of the country are being handicapped
bv the lack of cars was indicated yes
terday, when it was learned on the
highest authority that the United
States Steel Corporation and other
large producers of iron and steel have
lately contracted for their own account
for the manufacture of large numbers
Of freight cars, to be used in carrying
their raw materials and finished prod
ucts. The steel manufacturers. 1t was
stated. had been compelled TO take TINS
stem in order 10 insure a reasonable
certainty of getting deliveries.
Cost Of Equipment Jumps
Cost of railway equipment has risen
sharply since the war broke out. A
freight car that could be built for
81 600 in 1914 now costs $4,000. As an
example Of the high cost of freight loco
motives to-day compared with what
they were three years ago, r. 5. Lovett,
chairman of the Union Pacific Railpad.
Yesterday cited a recent incident. lie
said that the company entered the
market for a locomotive of heavy type
and found that it would cost S70,6OO,
against a price of s20,60O in 1914. This
price being considered prohibitive, 1T
was decided not to purchase.
Mr.. Lovett came out strongly against
the proposal of the Federal Trade Com
mission that the railroads be operated
or government account.
Government operation of the rail
roads is wholly unnecessary" declared
Judge Lovett. 81 don't see how the
government can increase the efficiency
Of lines which are already so coordi-
mated that it would be extremely diff
cult to improve their operation.
al think that there are great many
other things the government can do.
The whole question is that of cars.
The railroads need more cars, but they
cannot be taken out of the air. OF
course. if the government could get
cars faster than the railroads, that
would be a good thing"