New-York tribune., 1918-01-20
Wants to Clear Way for
Floating Ten Billion
Bonds
Explains Control
Of the Railways
Will Take Over Inland
Waterways, if Needed,
He Says

nittee the operation of government
control Of railroads and urged speedy
passage Of the Administration railroad
bill BY Congress to clarity the financial
situation, so as to prepare the way for
future government bond issues. He
also asserted that government opera
tion would be eXteHded to canals and
inland waterways, if it wos considered
necessary.
With the approval of Nh McAdoo. an
amendment TO the railroad bill author
izine the President to make separate
arrangements FOR compensation with
carriers which had to deal with abnor-
ma financial conditions during the
three-year period ending June 80, 1917,
was presented to-day to the House In
terstatc Commerce Committee. The
amendment is designed to meet the re-
quirenents Of the short lines.
John Barton Payne, representing thc
Director General, testified to-day before
the House committee that Mr.. McAioo
claimed the right to fix railroad rates
under the proclamation Of the President
taking over the railroads.
M NcAdoo spent more tran two hours
before the senate committee, during
which he was freely questioned regard
lng the necessity for government con-
troll of the carriers and the compensa-
ton Of short line railroads. He will
appear again Monday to answer further
House committee later.
Investigations are being made, the
Director General said, to determine
what short-line railroads are to be re-
tanned by the government. Those not
taken over, he declared, will not be
compensated. and if they suffer dam
ages redress Will have to be obtained
in the courts. He said it was not pro-
posed to keep control of any unneces-
sary lines Mr.. McAdoo said the pres
ent railroad organizations would con-
tnue to be employed as long as they
are satisfactory.
Doesn't Wish Disintegration
Il don't feel that the government,
ought to employ anybody who isn't
necessary" he declared, but | feel that
we should not disintegrate the railroad
organizations until Congress has decid-
ed the future of the railroads."
Mr.. McAdoo added hat some good
had been accomplished in ;he three
weeks OF government control through
rerouting distribution and co0rdInu-
ton.
Questioned regarding the necessity
sor government control, he said it had
been made necessary by the railroads
lack OF facilities to handle increased
war traffic and their failure properly
10 coordinate. Disclaiming any inten- .
fon to censure the carriers. he said
blame for not meeting the transporta-
ton situation rested upon them be-
cause OF their failure to increase their
facilities in 1915 and 1917. In those
years, he said, they spent less for i'm
nroremcnts than IN previous years de
spite increased traffic.
Mr.. McAdoo urged that the appro-
pration of $500.00O,0OO in the bill be
retained TO enable the government to
increase facilities or make good de
ticlencics, although he hoped it would
not ne necessary TO use the money for
'nls purpose.
Small Lines Are Perturbed
Director McAdoo was told by Sen
ators that small independent short
lines feared bankruptcy if the govern
lnent took control of the large trunk
ines, and that the government should
take over ali railroads, large or small.
II can't tell yet Mr.. McAdoo. re-
piled, what will be essential for the
purposes Of the war. The Treasury, al
ready overburdened, can't be called
upon to reimburse for real, imaginary
or indirect injury. don't think the
government should draft into its ser
wee needless railroad any more than
IL should draft cripple into the mill
tary service There is no intention to
90 any injustice to the short lines
they Will be helped as far as possible,
consistent with the needs of the ma
tion."
Chairman Smith suggested that the
snort lines are in difficult situation
because of the sudden transition of the
transportation systems from a com
pet!tve 20 a controlled basis
IT seems 10 me, Nh McAdoo re-
phed, chat the short lines are holer-
ing before they're hit. The bill ought
70 provide compensation. for railroads
o'ily that are really used and injured" :"
Senator Robinson. Democrat, OF Ar
Sansas, asked Mr.. McAdoo to tell the
committee why government operation
oi Iaihoads was accessory.
Mr. NcAdoo replied that he did not
mink he could add anything to what
alTeacy had been said, but he thought
necessary to get better cooperation
.. lAe transportation systems for the
rs It your opinion that the conges-
Non OF the railroads resulted from lack
vi l&clhtleS or the lack of proper use ?"
ASKED Chairman Smith.
Both. 1t grew out of the lack of
t8cliltles and the failure of the sepa-
rate railroads to coordinate"
Weather Delayed Relief
senator Poindexter asked what had
oeen done so far to relieve trans porta-
uon congestion
We've already forced re-routing and
sotIen better distribution"
mas there been puch substantial
oieaning up yet ?''
3. cont think so in the East where
'"gle is not much improvement vet"
me railroads, he said, were still un-
oer private management, which report
Tu extraordinary weather conditions
mad delayed relief.
8. m not giving excuses" he added.
pul tnere are conditions, some that no
1ruman skill and ability can overcome.
or three weeks we have had success
i've ollzzards and harbors blocked with
zee. One of the serious troubles is de-
LAY IN unloading freight cars. I've
, aieu TO correct that oy increasing de-