The sun., 1918-11-21
MACkAY TO FIGHT
PRICE SET BY u. S.
Payments Based on Unfair
Assessment, He Says.

Iostal Tele8raph and Gable Company,
met the announcement OF the Postrnas-
| ter-General last night, with relation to
the fixing OF compensation for his Vines,
with direct tcnarge that the Govern
ment was seeking. 10 pay the Postal but
half its revenues, base the payments
| upon an unfair and discriminatory as
sessment, and then devote the profits
earned from Postal operation to meeting
! loss on Western Union Telegraph re-
ceipts. The Mackay statement bristled
with fight and asserted that the COM
pany would take the case to the Court Of
| Claims.
| Briefly, Mr. Mackay charged:
That the earnings OF the Postal Tele-
, graph system are divided among the
, thirty-nine subs diary companies, the
1 Mackay Companies and the Boston Dis
trict Messenger Company
That the Government takes into con-
sideration in fixing remuneration only
the thirty-nine subsidiary companies.
! and the Mackay Companies and Boston
! District Messenger Company are not
| considered.
That the Government fixes the Pos
tails compensation on physical valu-
alton of $30,000.QoO, allowing 6 per cent.
on this sum. whereas the physical valua-
! prices.
That the Government fixes the COM
pensation of the competing Western
| Union on the basis OF its profits for 1917,
allowing more than such receipts as the
Western Unions pay.
That the profits OF the Postal for 1917
were s4,269.547. or more than double the
rate Of compensation allowed.
That the profits for August were $780,
Of oil uaA
$3.50, 600, and the Government took s17o.-
900 to be applied against its loss on the
other company.
That the courts have held that such
companies are entitled 10 make q fair
return upon their business. and that the
Government not only untustly overrides
the decisions OF the highest courts but
discrimnates against the Postal Com
pany grossly and unfairly in favor OF
its rival
Cable system Explained.
1.-THE Postmaster General" says Mr.
Mackay, declines to tell us what has
been awarded TO US. although we have
inquired what the amount is, Meantime
statement is issued from his Office with
all sorts Of reflections on our system
Now, Mr.. Burleson knows very we'll the
reasons why the Interstate Commerce
reports OF our thirty-nine subsidiary
companies do not tell the whole story"
He then explained that he had written
to the Postmaster-Generalo on October 90
showing that the Postal Telegraph sys-
TEN was organized on the plan OF the
Mackay Companies Tan unincorpCrated
trusteeship which does not report to
the Interstate Commerce Commission) /.
fina ncing all OF the little companies by
furnishing all Of the money for the re-
construction OF their lines. and for the
annual interest of $4,000 a year which
has TO be paid by the land line system.
and also furnishing the money for the
construction of new lines in new terri
tory and additional wires in old terri
tory.
in return" continued the letter. tho
Mackay Companies by contract with
these various local companies receive a
large proportion of the through tolls"
He explains clearly that the whole OF
this revenue would have appeared in the
Interstate Commerce reports II the
Mackay Companies had been subject tn
making reports 20 the commission, but
since they constituted but a private trus-
teeship they were not asked to report,
and properly did not do 80. thus account
ing for the discrepancy alleged by the
Postmaster-General.
I'm other words" said the letter, which
apprised the Postmaster-General on Oc-
tober 20 OF the full facts. 1.-The entire
earnings Of the Postal Telegraph system
are divided between thirty-nine compa-
niles, which report to the Interstate Com
merce Commission. and the Mackay Com
panies and the Boston District Messenger
Company. which do not report to the
Interstate Commerce Commission and
are not subject thereto"