Daily capital journal. (Salem, Oregon) 1903-1919, 1919-01-18

New York, Jan. 16.-The dominating
question in financial circles at the mo-
ment is the railroad situation. Shall
the railroads De returned to their own.
rs; if so, under what conditionsa The
Association of Railway Executives, rep
resenting about 95 per cent of the rail-
roads, has put out solution OF tns
problem that should receive careful
consideration Its main features are
private ownership under government
control; the establishment of a Depart
ment of Transportation under direction
of the Secretary of Transportation; the
maintenance of the Interstate Com.
merce Commission as quasi judicial
or advisory body; the transfer of ad
ministrative powers from that body to
the Department of transportation; the
roads to have right to initiate rates
subject to Government approval; the
issue of securities to be regulated by
the Government, and the Sherman law
to be modified. These are all perfectly
just measures, and would save the
roads from the policy of starvation
which prevailed under rule of the In
terstate Commerce Commission. 1t is 20
be hoped these suggestions will receive
the Endorsement of public opinion. Pub
lie ownership of railroads is a vastly
different matter in the United States,
with its immense territory and mileage
and peculiar political conditions, to
what it is in Great Britain, Germany or
France, with their compact territory
and different political methods. Gov
ernment ownership would be deub tful
road to efficiency; and, granting the
past misdeeds of private management
which will not be repeated, the best So
luton is that of private ownership
combined with government regulation.
Certainly no such radical step as pub
lie ownership can be justified, until the
other alternative has been tried; and
the country has enough serious prob
lens on hand without complicating them
by imposing upon an already overload
ed government such an experiment in
transportation.
Next to the rairoad question, the
demobiization of industry is the most
poten influence. Satisfactory progress
is being made, although more or less
confusion exists. This must be expect
ed, and is only temporary Thus far
most of the labor released by reason of
rehabilitation has found ready employ
ment. Of late, however, there have been
signs of the supply exceeding the de-
mand, usually owing to the difficulty
nR hrtn pao nd tnha I,a
labor situation, however, is still acure.
as demonstrated by the harbor strike
this week in New York. The business
outlook is affected materially by in
Vulnerable uncertainties arising from
the war. Prices are a subject of con-
siderable concern; the tendency of
many commodities being distinctly
downward in spite of denials. AS stat
ed before in these adviees, there is no
scarcity of staple products, save in OK
ceptional instances, and not infrequent
ly these are ample supplies. In some
cases demand has diminished because If
cessation in war orders; in other cases
because of lessened consumption follow
ing high prices. There is no doubt but
that deflation in commodities has al
ready started viii is necessary as a
matter of safety; and if prices could
only be reduced to a gradually lower
level, there is no doubt that business
and enterprise would revive under a
stimulus 50 natural and sound. In I'll
we may have to endure
a period of quiet while the process is
going on; but intrinsic conditions are
sound, especially among the agricul
turists and wage earners, and recovery
seems to be confidently expected when
spring arrives and construction becomes
possible.
The monetary situation arising from
war finance is an added feature of re-
straint. Preparations are already in or
der for the next loan of billions more,
which the government is even now dis
counting by selling short time treasury
notes. The latest estimate is that the
loan may be $6,0O0,000,000, but it is
hoped less sum win be ample as it is
to say that such a tremen-
dous drain upon the nations savings
now is heavy handicap upon business. |