New-York tribune., 1918-02-25
German Railroad F nance
In a Bankrupt State
Prussian Roads Carried Enormous Volume of
Traffic Last Year, but Expenses Were So
Heavy That They Lost Heavily
Further Rate Increases Necessary

used up some time. AS good house
holders we must naturally take care
that we straighten out the deficit of
BIT millions. This will not be easy
when we consider the expenses which
are continually increasing.
"Prussia's share in the payment OF
indemnities to Eastern Prussia is 70
million marks. These will have to
come out of the Prussian treasury.
The forest administration is still
Sleeping Beauty, and it will take
year before it will yield fruit. The
mining administration, on the contra
ry, has SO far had 1916 as the most
successful year. Had we not borrowed
in 1916 the sum of 100 million marks
in order to straighten out the old
deficits, our incomes and expenses
would have balanced, and this would
have repeated itself in 1917 and 1918.
"The income Of. the railroad ad-
ministration in 1915 for the first
time surpassed the fourth billion.
The increase in passenger as we'll as
freight traffic was immense. The
year 1916 meant for the railroad
administration the climax of the
war times. Since then it's incomes
have been falling down very rapidly,
for in 1917 the railroad administra-
tion expects to find a deficit of $50
million marks. Doubtlessly, it will
be possible at least partially to
straighten out this deficit by means
of the surplus income of the mining
administration, which has surpassed
the brightest hopes.
Why Rate
Increases Are Necessary
Con account Of the rise in the price
of coal, new decline has taken place
in the railroad administration, Sc
that in 1918 the railroad admins
tration will be confronted by deficit
of 500 millions; it will bring nothing
to the state, will not lay aside any
thing, but will have to take few
dozens of millions from the state
Here radical Improvement in the
condition of income is desirable.
"We cannot impose new taxes
upon the population Of the empire
and the states as long as there are
these extraordinary differences in
the communities therefore, we
must Immediately proceed to the
equalization Of burdens. Without
any general state measures this
is impossible. We furthermore need
tax reserves because of the coming
imperial finance reform. Naturally
every Minister Of Finances of Prus-
sia must agree that the taxes on in
comes and wealth belong to the
states of the federation. And no
Minister Of Finances could take upon
himself the responsibility Of yield
ing these sources unless he received
something to replace them. But the
empire, the states and the commu-
mites form one unit, and this must
be taken into consideration. The
principle must be not only Give to
the Kaiser what belongs to the
Kaiser,' but also Leave to the King
what belongs to the King At the
present 31s billion marks of the
Prussian taxes go to the empire.
These 31a billions have to be sub
stituted by other taxes.
"All this makes it necessary to
raise the railroad rates-passenger
rates, 10 per cent; freight rates Is
per cent; military rates 10 per cent.
This rise in rates will bring a total
Of 389 millions. But even then the
railroad administration will be un-
able to contribute it's share to the
state. One hundred and fifty-nine
millions will still be missing. The
new raising of the railroad rates is
only temporary; we hope to abolish
them after the war, but we must
take the liberty of trying their effect
upon traffic and state finances"