The Ordway new era., 1918-01-11

great properties are owned and glad
to avail ourselves of the experience
and trained ability of those who have
been managing them.
Shipper safesuarded.
II is necessary that the transporta-
ton of troops and of war material. of
food and of fuel, and of everything
that is necessary for the full mobiliza-
tion of the energies and resources OF
the country should be first considered.
but it Is clearly in the public interest
also that the ordinary activities and
the normal individual and commercial
life of the country should be inter
fered with and dislocated as little as
possible, and the public may rest as
sured that the interest and conven-
fence Of the private shipper will be as
carefully served and safeguarded as
it is possible to serve and safeguard
1t in the present extraordinary circum-
stances.
While the present authority of the
executive suffices for all purposes OF
administration, and while, of course,
all private interests must for the pres
ent give way to the public necessity,
1t is, i am sure you will agree with
me, right and necessary that the own
ers and creditors of the railways. the
holders of their stocks and bonds,
should receive from the government
an unqualified guarantee tina. their
properties will be maintained through
out the period of federal control in as
good repair and as complete equip
ment as at present, and that the sew
eral roads will receive under federal
management such compensation as is
equitable and just alike to their own
ers and to the general public.
Three-Year Average Payment Basis.
would suggest the average net rail
way operating income of the three
years ending June 30, 1917. / earnest
ly recommend that these guarantees
be given by appropriate legislation
and given as promptly as circum-
stances permit.
/ need not point out the essential
justice of such guarantees and their
great influence and significance as
elements in the present financial and
industrial situation of the country.
Indeed. one of the strong arguments
for assuming control of the railroads
ut this time is the financial argu-
ment. 1t is necessary that the value
of railway securities should be justly
and fairly protected and that the
large financial operations every year
necessary in connection with the
maintenance, operation and develop
ment of the roads should, during the
period of the war be wisely related
to the financial operations of the
government.
Prosecution of War Primary Object.
Our first duty is. of course, to CON
serve the common interest and the
common safety and to make certain
that nothing stands in the way of
the successful prosecution of the
great war for liberty and justice. but
it is an obligation of public con-
science and of public honor that the
private interests we disturb should
be kept safe from unjust injury. and
it is of '5e utmost consequence to
the gsrcnment itself that all great
financial operations should be sta
bilized and co-ordinated with the
financial operations of the govern
ment. No borrowing should run
athwart the borrowings of the fed
eral treasury and no fundamental
values should anywhere be unneces-
sarily impaired. In the hands of
small investors in the country, as
Well dS III HdllOHdl Duhhs' thc iioui
ance companies, in savings banks. in
trust companies. in financial agen-
cies of every kind, railway securities,
the sum total of which runs up to
some ten or eleven thousand mil
lions, constitute a vital part of the
structure of credit and the unques-
tionable stability of that structure
must be maintained.
The secretary of war and l easily
agreed that. in view of the many com
plex interests which must be safe
guarded and harmonized, as well as
because of his exceptional experience
and ability in this new field of gov
ernmental action, the Hon. William q.
McAdoo was the right man to as
sumo direct administrative control OF
this new executive task. At our re-
quest he consented to assume the au-
thority and duties of organizer and
director general of the new railway ad-
ministration He has assumed those
duties, and his work is in active pro
gress. 1t is probably too much to ex-
rect that even under the unified rail
way administration which Will now be
possible sufficient economics can be
effected in the operation of the rail-
ways to make it possible TO add TO
their equipment and extend their op-
erative facilities as much as the pres
ent extraordinary demands upon their
use will render desirable without re-
sorting to the national treasury for
the funds.
Urges Congress to Respond Promptly.
If it is not possible 1t will, of course,
be necessary to resort to Congress
for grants of money for that purpose.
The secretary of the treasury will ad-
wise with your committees with re-
gard to this very practical aspect of
the matter For the present l sug-
gest only the guarantees | have indi-
Gated and such appropriations as are