The sun. [volume] (New York [N.Y.]) 1916-1920, 1918-12-12
One National Railway System That
VIII Never he.

If we read correctly Representative
GRAY's bill providing for the National
Railway Corporation, 1t fits the
Jockeys description of a nag exam
ined by him. HE is a perfectly good
race horse except that he has no legs
to run with"
Mr.. GRAY's bill, as we understand
1t, provides that the new corporation
shall have power ito acquire, by pur-
chase, lease or otherwise" any or all
railroad corporations that may wish
to become part Of the new scheme.
But what should lead any visionary
to believe that II a great and power
full railroad is able TO earn money on
any rate schedule or wage system
that will permit the average road to
exist 1t will trade itself into a cor
poratiOn for its mere stock, represent
ing both the good and the bad, the
profitable and the profitless roads?
A gilt edged share of his stock will
look better to the owner than 1000
shares Of sheer gamble.
Are the Pennsylvania, the Lacka-
wanna, the Chicago and Northwest
ern, the Union Pacific, the Southern
Pacific, going to swap their valuable
securities for mere paper securities
In Il new corporation which will Have
TO carry also the poor roads, the bank
rupt roads, the junk pile roads?
A rich road might be willing to sell
out for cash 10 the new corporation,
but the only conceivable buyer that
could satisfactorily pay for all the
great and opulent roads would be the
United States Government itself. If
the national Treasury could not pay
the actual cash, 1t could pay with Sc
curity guaranteed as to principal and
interest by the Government. But Rep
resentative G>AY's proposal is not that
the Government shall pay anything;
IL Is that the Government, in fact.
shall receive some OF the net profits
above certain figure, If there are
any such net profits on the whole
operation.
Representative GRAr's bill also pro-
vides that the directors of the new cor.
poration shall have the power to FIX
rates, subject naturally to Government
restrictions. But If the Government,
through the Interstate Commerce
Itsar1N fNiE< aiAn ANh
were unwilling to permit rates high
enough to make the whole combina
ton of railroads an Garner, then no
matter how much the great roads
might still earn there would be moth
ing for their former stockholders I'M
less those great roads could also
earn enough to pay dividends on the
whole outfit.
Many a steel mill has gone to
smash, although it was splendid
Garner. by being tied up in a bundle
with other mills that couldn't earn
anything. The same thing has been
true Of valuable properties in the
merchant marine 1t W; true. for
specific example, Of the New York,
New Haven and Hartford. That gold
mine railroad could earn more than
enough for itself. 1t went broke
when it was consolidated with all
sorts and descriptions of other prop
critics and tried to make living for
them all.
Unless the owners Of the great, rail-
road earners could get cash for their
property or could get n Government
guarantee as to principal and inter
est. not one Of them would look at
Representative GRAY's proposition Of
a great national railway. That's the
practical side of 1t. Without the
great earhers the National Railway
Corporation composed OF the God for
saken In the transportation world
could never even begin. That's where
the dream ends.