The Columbus commercial. (Columbus, Miss.) 1893-1922, 1917-12-30
GOVERNMENT ASSUMES
CONTROL OVER ALL
RAIL LINES.
McADOO IN CHARGE
Salaries Of All High Officials
Will be Materially Reduced
At Once.

Following an announcement made
by President Wilson last Wednes-
day, the government on Friday took
over the operation of railroads
throughout the country, and it is
officially stated that the first execu-
tive order will be one reducing the
enormous salaries now paid some of
the high railway officials and in
creasing in some measure the wages
of employees holding minor positions,
especially those engaged in the per-
formance of manual labor.
The railroad systems will be oper-
ated, according to the official state
ment issued by the President, under
the direction Of Secretary McAdoo.
as director-general, but he will not
relinquish his place in the cabinet
Securities to be issued while the
government is in control will be at
interest rates not less than a per
cent and the issue will be made un-
der point authority of the director
general and the interstate commerce
commission.
President Wilson, when ne out
lines the governments plans, in his
EoYsh soHaiag address to congress
will ask that the government be en-
powered to buy any quantity of new
railroad securities. All dividends
over and above an amount to be
agreed upon will go to the govern
ment
Congress win be asked also to ap-
propriate large fund-probably
5000, ,000, ,000--for the immediate
supply of ro1ftAg stock to handle the
flood of traiic which has swamped
the roads.
The director general will have au-
thority to decide whether the gov
eminent shall also assume operation
and control of the express com
panies.
President Wilson will recommend
to congress that the railroads be
guaranteed the average net income
of the three years ending June 80
1917. but any railroad may abide by
ito constitutional right to refuse tc
accept this basis of compensation
In that case the question will pass to
an arbitrating body, the precise ma
tpre of which is to be determined Dy
congress.
The equipment fund will also DC
used to pay any defrtt of earnings
this wear under the pre-war average
of the amount agreed upon, but or
fcials who have given the situation
close study believe it may be unnec-
essary to expend any great sum II
this way. They believe that the
government, by eliminating waste
full competition and unnecessary ex-
nenses under common control, car
save hundreds of millions of dollars
Some officials even estimate that th'
saving will be billion dollars a yeal
and that the government will be able
to garner revenue from the opera
ton to insuring railroad securltle'
holders against loss.
Although in most cases earned
dividends exceeding the guarantee
will revert to the government, ron
press will be asked to make provision
for railroads whose pre-war earn
ines were abnormally low, by author
izing payment of dividends in exces
Of those amounts on approval OF tn
interstate commerce commission.
Railroads will continue to provid
for their ownissues of securities, pu
will be compelled to obtain the ap
proval of the director-general betor
going to the interstate comlnerc
commission for final sanction. In
commission will pass on the size 0
the issue and the director-genera
viii determine the interest rat
+ which could not be less than pc
cent under the proposed plan.