The sun., 1919-04-14
NEW RAIL RATE
JUMP EXPECTED
Some U. s. Officials, Includ-
ing Illness Advisers, Believe
Advance Is Certain.
BIG DEFICIT EACH MONTH
Motor and Water Lines Take
Traffic, Cutting Revenue,
as Expenses Mount.
BIG DEFICIT EACH MONTH
Special Despatch 10 The sus.


crease in railroad rates before the rail-
roads are turned back to private own
ership is regarded as inescapable by
several offrcials in Washington who
have been making a close study OF the
situation occasioned by wage raises,
dwindling traffic and revenues and the
deficit under Government operation
that is piling UP steadily.
officials OF the Railroad Administra-
ton state bluntly that no such course
Is contemplated and that It has not
been considered. Nevertheless IL is
known that certain advisers of Direc-
tor General Hines believe that unless
conditions take a sudden change for
the better a rate raise is the only al
tentative. other Government officials
hold the same view. Members OF the
Interstate Commerce Commission,
which is charged with supervision of
the railroads. are watching the situa-
ton closely.
Many Of the commissions preroga-
tives are being exercised by the War
Control Board of the roads, but the
commission is still functioning with
all Of its powers. 1t is no secret that
there is an element on the commission
that Is distinctly in favor of a rate In
crease that would restore earnings OF
the roads to approximately their pre-
war status at least.
Many new factors have come into the
situation since Mr. McAdoo before his
retirement prorhes sled that the railroads
would have surplus in 1919 under nor
NAL conditions. Normal conditions have
not arrived and are not even in sight.
Trafic Is Below Normal.
Trafic on virtually all of the roads is
below normal for the season and the ex-
rates, which were effective for less than
half Of the year 1918, has not appeared
! In January of this year, two months
| after the armistice, the Railroad Admin
istration had deficit OF about ss5, ,OO0,-
900. Figures for February soon to be
made public. will show a like result, and
railroad officials say March will be no
better.
1t will take a tremendous increase in
freight and passenger traffic and much
greater economy under Government
operation than has been attained TO
make up the difference during the re-
mainder OF the year
| Many factors are contributing against
an increase in trafic. The traffic rate
raise or 20 per cent. is more potent in its
effect toward retardation of peace trafic
than 1t was toward war traffic Industry
IS not going at top speed and I'm addition
high rates and motor transportation and
waterway development are contributing
to keep freight away from the railroads
! City. State and national campaigns
have been conducted in recent months
and the Federal Government has aided
In highway transportation development.
| The Council OF National Defence Is
working consistently to this end With
traffic as whole under normal and
motor trucks taking a part OF what is
left the effect on the railroads is ap-
preciable.
Wage Advances Swell Total.
| In addition expenses have been de-
cidedly increased through the latest
wage increase 10 the brotherhoods and
other train operating employees. These
wage raises will offset many OF the
economies resulting from Government
operation.
When regional directors were in con-
ference with Director General Hines sew
eral weeks ago a freight rate advance
was suggested as necessary to meet the
situation. Mr.. Hines frowned on the
idea and II was stated officially that II
had not been officially or seriously con-
sidered.
In the face OF the present high rates
there Is full realization here that I,
would not be easy TO make the public
swallow further advance. Certain off,
cials. though. are of opinion that a raise
by the Government with all the cards on
the table would be accepted.