Bisbee daily review., 1918-02-08
GOVERNMENT MAY FACE DEFICIT IN DIRECTION OF RAILROADS;
 INCOME DECREASES IN YEAR 1918.

private operation. rail earnings de- clined sharply according 10 early re- ports from railroads. The average re ductiOn of income was estimated at S0 per cent caused by the ever-mOunt- ing cost of operation. douhly increased by the bitter winter weather Ot De cembeT. together with a sudden drop in revenues resulting from traffic con gestiOn and embargoes.
 Compared with estimated income of S95S. .000.0O0 last year. the figures for 1916 were 1.OS7 .5SS .0OO. for 1915. S7I6.44e. 900: for 1914. S692. .SS0. 900. and for 1918. SSi6.5lO.000.
 Last year the total revenues from railway operations were S4.OSS. .000. coo and operating expenses were S2. .S6l.- 000. 900. leaving a net revenue of Si.- 177.O00.00O. From this were deducted SS17 .000.0O0 taxes. and minor items O. uncOllectable revenue, to compute the net income figure. which is cOmpara- ble in general way to the basis of government compensation.
 The reason for the decline in net in come last year is shown graphically by the report. Operating revenues were 10 per cent greater than the SS- 622. 900 900 of 1916. but expenses ran more than % per cent above the SS.- 27S.O0O.OOO mark of the year previous ly.
 Costs Increase
 Nearly all items of expense were higher Wage increases are estimat- ed at 20 per cent. Cost of coal. train supplies and repairs went uD by bounds with which the immense re- ceipts from freight and other revenues did not keep pace.
 People travelled more in 19I7 than in the year previous. but the increased revenues did not go far in eounteract- ing the steadily declining income. War caused an immense increase in haul ing. and from freight yards the roads received most of their revenues. These revenues are estimated at S2- sos 900 900 as compared with S2.5I3.- 00O. 900 in the banner net income year of 1916. Passenger revenues were SS10, ,0OO. 900. as compared with S7GS 100000 the year before. Receipts from mail were actually smaller than m 1916. despite the fact that the bulk of mail transportation was much greater. Only S5S,70S.000 were received from the government on this account. near ly S3.e00.00O less than in 1916. Tho reduction is attributed tO the reaGiuSt- ment of the basis of payment from weight to space
 Receipts from express companies for hauling jumped from S90.29S. DOC in 1916. to S106.0O0. 900 in 1917.
 For maintenance of way and struet- ures. railroads spent S452. .90O. .100. about S2S.0O0. 900 more than he year before. For maintenance of equip ment. the cost was S6S2 .000. coo. as compared with S597. 900 in 1916.
 Taxes Increase
 Taxes in 1917 showed a sudden in- crease in the last three months when railroads were able to determins for the first time approximately what their war taxes would be. They began in September to figure on the increas es in their tax accounts. ana these jumped from SIT 900 in August to an average of $2S.0O, ,00O in each of the latter months.
 Other comparisons by months show that beginning in May. freight receipts increased rapidly. as the government was building cantonments and stimu- lating big war industries. Although the government was given rates aver aging f Oper cent lower than rates 10 private shippers. this traffic proved profitable because it was in large Quan titles. Freight revenues reached the peak in October. amounting then U