New-York tribune., 1918-05-27

ana prices, COSL aDOuC pOOO,oVV,oOV.
To state it in another way, the facil-
tiles which can be provided now for
1898, 100000 would have cost on the
basis of prices and wages of 1915
about $500,OoO,0o0.
In the three years ending in 1915
the increase in investment in road
and equipment averaged $457 100000
annually, and in the three years end
ing with 1912 it averaged S755,000,-
600. Making allowance for differ
ences in wages and prices, the au-
thorizations for this year do not pro-
vide for as great increases in facili-
ties as those made on the average
annually from 1909 to 1915, inclu-
sive. On the other hand, they prob
ably provide for all or even more
than all increases in facilities which
it would be possible to get labor,
money and materials to make.
While measured in the amount
which money will buy, therefore, the
authorization for this year does not
represent much Of an increase over
what The railroads spent during the
years of their prosperity, it does rep
resent a large increase over what
they have been able to spend during
the past three years, when they have
had great difficulty in securing addi-
tional capital because of the uncer-
tainties, to say the least, as to how
the capital would be treated at the
hands of regulating authorities. The
additions to capital account in 1917
are estimated at somewhat over
$500, 100000. A careful estimate
shows that the additional investment
during the last six months of 1917
was about $24O,0O0,Ooo. The Inter
state Commerce Commission reports
show the following increases in cost
! OF road equipment back to 1914:
Calendar year 1916. 1881, ,493, ,631
Fiscal year 1916. 258,457,485
Fiscal year 1916. ......... 263,155, TIA
Fiscal year 1914. .......... 512,338,326
Making Amends for
Evils Of Regulation
The government is apparently,
therefore, trying to make up to some
extent for the results of the failure
OF government regulation to attract
new capital into this field in recent
years. The authorization of $685.
100000 cannot, however, be exactly
compared with the increases in cost
of road and equipment, as reported
by the Interstate Commerce Commits
sion. In the first place the money
has not yet been spent, and the ac-
tual amount spent may be less than
that authorized, just as railroads
have often approved budgets early in
the year and then have reduced them
later because of the difficulty of rails
ing money.
Ais in the case of the equipment
item, the authorization is not COM
parable because the $480,OO0, 900
represents the gross cost of the new
equipment without any charge
against capital account for old equip
ment which may be retired. Prob
ably very little equipment will be
retired this year, but the statement
OF the capital account for any year
reflects the result both of the new
money put in for the new equipment
and the amount written off for re-
tired equipment. In the case of ad
ditions and betterments, however,
where provision is made for a new
facility to replace one that is retired,
the figures given represent the in
crease in the cost of the new facilitv
over the cost or estimated value Of
the facility retired, and represents
the new money required rather than
the manner in which the transactions
are dealt with On the carriers books.
Bearing on the question of whether
the $938,o00,000 is adequate, it is in
teresting to recall that the Rail
roads War Board, in their statement
to Senator Newlands in December,
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