The Daily Missoulian. [volume] (Missoula, Mont.) 1904-1961, 1918-02-02

ltlS 10 Get
5.33 PER Cent
Earnings on Investment in
Railroads Definite Under
Wilson Plan.
THOUSANDS HOLDERS
Attempts to Block Legisla-
ton in Congress Are
Deemed Certain.
THOUSANDS HOLDERS

washington, FEB. There are tw
ways Of looking at the railroad prob
lem and probably both ways will hav
their champions in congress.
The big way is to look at the situa
fion in general; the little way, to Sc
II oily In detail.
the particular detail that will rails
the most argument In congress will b
the compensation paid to the owner
pf the railways.
The real owners are not the Wa
street bankers who have been control
9nG, manipulating and milking the BIZ
railway properties. They are controlle
~ getting proxies from the hundred
u thOuaands Of owners all over tn
country.
These bankers are hit the hardest b.
J RTeGadent Wilson's action in takin
over the railroads, for it cuts them on
q Of the game
II Also cuts out the operating Off
Nlals who were mere tools Of the bank
erS--and, incidentally. gives real rail
rad operators show for their whit
alley.
The big thing about it all is tina
the government has taken over the rail
roads and will organize them into on,
national railway system.
Whether compensation to stockhold
err II based on the average for thu
past three, four or five years, is rela
ttvoay . small matter.
II the average for the past three
years 10 taken. MS suggested by the
president. the figures are as follows:
Property investment. $le.sll.46s.0 6S;
net railway operating income, $901,-
$3.50: interest return on investment
SIS per cent.
Il the average for the past five years
10 taken, these are the figures: Prop
erty investment. 3ls.472. ,337; net
railway operating income. 1891 ,Sll. ass;
interest return on investment, sos per
cent.
The interest return on Investment
for the past five years was as follows:
1918, SOS per cent; 1914. 4.13 per cent !;
1915, AT per cent: 1916, 6.S7 per cent !:
1917. Sol per cent.
The depression was on in 1913, and
reached the bottom in 1914. Then
things frightened up and the year end
ING June 80, 1917, was the big year.
The year 1S16"was lean and 1916 and
1877 tat years. although the interest
return on investment averaged but
SIS per cent for the three years.
Considering the fact that the govern.
ment. In taking over the properties.
will break up the organizations Of the
various railway properties. the presi.
dents recommendation is not consid.
cred unreasonable even by those who
1rle ~,
able. and the only solution Of the rail.
way problem.
OF course, there will be no solicita.
ton of either freight or passenger
business. and an army of agents and
solicitors will be out of jobs.
Undoubtedly millions of waste will
be eliminated in many ways.
Ticket and freight offices will be
consolidated and other surplusage cut
out.
That means that il the government
ever turns back the properties to Wall
street. the competitive organizations
will have to be built up all over again.
The railroad banker will doubtless
put up a fight to change the presi-
dents bill SO that the properties will
revert automatically to the old owners
after the war. But the administration
Will stand firm for holding the rail
roads until congress, by affirmative
action. decides to give them back.
Probably the biggest fuss, however.
VIII be made over what the govern
ment will pay the stockholders.
That can be used to string the argu-
fnant M trpf hi tn, a
while the various political experts and
presidential candidates in congress air
their Views.
Some will demand government own
ership now, which will help muddy the
waters. The real friends of govern
ment ownership feel that the presi-
dent is going about it in an orderly
way, and that the quicker congress acts
and gives McAdoo a chance to get re
suits the surer they will be of gov =
eminent ownership.
There may be some confusion when
figures are discussed, unless it Is re-
membered that while net operating in
come. has increased, property invest
ment has also Increased.
Interstate commerce commission fig
Cres give the property investment
June 80. 1913. at sl5,55i ,351,463. while
for June 80, 1917, the property in
vestment Is sl7,3s2 .Se0.s14, or almost
two billion dollars more.
Those who favor the presidents pla n
cay also that the value Of dollar dur
ing the two periods must also be con-
s!dered--that is to say, a dollar of net
income now isn't worth as much in
z the things it will buy as a dollar was
five years ago.
One Of the best posted authorities
On railroads says this of the plar
proposed by President Wilson.
II is ms fair a plan as could hay,
been devised. It Is fair alike to tn,
real owners and to the public. Will
there Is talk of 1916 and 1917 bein,
fat years. there have been no real fla
years. They are fatter than 1913, lal
and 1915. but these years were Yer
lean years. In fact, the railroad bust
ness has not been an attractive one fl
investors for number of years.
We will now get at real costs {
oreratton. Waste will be eliminate
and real efficiency brought abou
y There will be a chance for the re