The daily Gate City and constitution-Democrat. (Keokuk, Iowa) 1916-1922, 1917-01-08
, 74o, 900, an average of about l4s.ooo a

74o, 900, an average Of about $4,000 a
year. ....n
in striking and even starting man-
ner one Of the most important iacss
to be considered In connection Win
the present situation OF the rahWHys;
This 10, that the car shortage anu
trafic congestion OF 1906 came AZ the
end Of 4 decade during which lneIe
had been a great expansion OF Trans
portation facilities. while the car
shortage and congestion OF tramc n
1916 have followed immeqiateiy ON
the heels OF long period Of depres.
sion during which the increase Of
facilities has been relatively small.
Since our railway facilities have prov
ed inadequate at the beginning OF the
present period OF prosperity. What
kind o. situation VIII Il cause 20
develop IL industry steadny grows
more active and traffic heavier, az u
did for several years prior 10 1S<o
Reason for Reduced Rate Of Develop
ment.
The difference between the rate
of development Of railway facilities
in the period ending with 1905 and IN
the period ending with 1918 is attr1b.
uted to the difference in the rate OF
return earned during these periods.
.In every year of the five ending with
1906 but one the net return of the
railways on their investment In road
and equipment exceeded per cent.
In every one of the five years proceed
ing 1916 the net return earned was
less than 5 per cent, and in two OF
them-1914 and 1915-it was less than
4 per cent.
"The recent increase In gross and
net earnings has been followed I'M
mediately by an increase in expendi-
lures for new construction and TOT
equipment Past experience shows
that the continuance and intensifica-
ton Of this revival of railway eHpan-
sion is absolutely dependent upon
the continued earning by ell the rail-
ways OF the country OF net Operat-
ing ino6me exceeding per cent on
their property investment; and IN
view OF present conditions in the
money markets Tot the world 1t is
probable that past experience Is not
an entirely safe guide, and that the
minimum average net operating In
come SUFFICIENT in the past to cause q
rapid expansion OF railway facilities
will not be sufficient in future. The
average net operating income earned
on road and equipment in good years
and In bad probably cannot, in view
of past experience and of present
financial conditions, with safety be
allowed to fall below 6 per cent.
THE net operating income OF the
railways during the year Just closing
has been unprecedented. probably
Averaging more than 6 per cent on
the Investment. e road and equip
ment. Until within the last eigh-
teen months average gross earnings
per mile per month had exceeded 81
300 in only one month, October. 1912.
In three months Of the present year.
hOwever-May, June and Nly-more
than 81, 300 per mile was earned. In
August and September all previous
records were broken with earnings OF
$1,41s and 81. 400 per mile.
Operating Expenses and Taxes In
crease.
Operating expenses and taxes a.
ready have begun to show heavy In
creases. In the latest month for
which statistics are available. name
", ocplGHUcI, luC RCISCASuoC VI Ia
crease In operating expenses and
taxes per mile for the entire country
was greater than that Of the increase
in the total earnings per mile. This
tendency on the eastern Hines. where
the congestion of traffic Is greatest,
Is especially marked. the increase in
total earnings during the month men
toned being IL per cent. while the
increase In expenses and taxes was IS
per cent"
This increase in operating expenses
is attributed to increased wages and
also to advance in the cost OF equip
ment and supplies. For example.
the price OF rails has been advanced
during the year from $50 to $40 per
ton. while during the recent period Of
prosperity the average cost ora
freight car has advanced from about
$1,000 to about $500. The Railway
Age Gazette concludes:
in view. however, Of the progress
which has been made within recent
years in improving the management
Of the railways. in improving regula-
ton, and in educating business opin-
ion and public opinion regarding the
railway situation, and in view Of the
large earnings the railways are now
making without any serious complaint
from any source that tthey are ex-
cessive, the outlook for greater pros
perity for the railways and aflliated
Industries. and for a large expansion
of railway facilities during the next
few years, seems promising"
Is IMPORTANT