Evening journal., 1919-04-04

Sir Eddie Geddes' confession in tn,
House Of Commons Mondsy that The
Engl sh railways, after four years Of
government control for war purposes
are In "a semi-paalyzed financial con-
dition," and that the government is
losing Si,250O00 a day in operating
I them, evoked deep interest among
bankers and railroad men here. IL gave
! official confirmation TO what they have
I known In a general way for months
/ namely that the failure TO raise freight
rates in England to Offset the enor-
nous increase in operating expenses
4 had created a practically Impossible
situation for the private companies
/ there
Frank II. Fayant, assistant to the
chairman Of the Association Of Rail-
way Executives, who recently returned
from Europe after making a personal
investigation OF the effects Of the war
upon the Engl sh and French railroads,
gives the following statement Of the
financial position Of the English trans
p0rtation industry:
"When the English government took
control Of the railways for war pur-
poses in 1914, guaranteeing as rental
to the owners the pre-war net income
the annual receipts were S6S0000.000
and the operating expenses were $780,
000000-Of which S250.OO0000 was the
payroll, S2j,0000O0 covered taxes. and
Si5j,00O000 paid for coal and materials
This left a net income OF s250000,000
TO pay interest and dividends on in
vested capital giving a return TO the
owners OF less than per cent.
English railway wages before the
war were very l0w-too low for de-
cent living conditions. At that time
the average annual wages earned per
employe were less than $3.50 while in
this country our average was then
more than $500. The rapid rise in the
cost OF living and In wages paid mum
ton workers created unrest among the
English railway men. The government
attempted 10 deal with the prOblam by
giving was bonuses based on the rise
in the cost of living. The workers ac-
cepted the money. but they wanted
wages that would continue after the
war and not bonuses. The government
accordingly dropped the word.
Instead Of giving the larger in
creases 90 the less well paid men and
smaller increases to the better paid, as
our Railroad Administration has been
doing, the English Government gave
identical increases TO all employees. Be
ginning in October. 1914 and running
90 November. 1918, there were eight
successive wage increases varying
from 3 shillings TO shillings a week
and t0talling 33 shillings or $3.50.
These Increases in weekly wage added
s275. 100000 to the payroll Then at the
end Of the war, when Lloyd George ap- !
pealed 10 the country for a vote Of
confidence. the railway unions made
a renewed demand for an eight-hour
day. Lloyd George granted the demand
and this added si25OO0OO0 more to the
payroll. making the total increase in
wages siO0O00OO0 or i6O per cent.
"This brought the payroll up toi
S650O00OO0, as compared with total
railway revenues before the war OF
sGsOnOOOOO. There was also. as in
this country. q very large increase in |
the cost Of coal. steel and other mater
ials. which added sii0OO0O0O more to !
the operating expenses. The greater |
part Of this item, Of course, is made !
up OF increases in wages TO coal min |
ers and steel workers. The increase IN |
the cost Jf materials added 10 the in
crease in wages brings the operating 1
expenses OF the English roads up to
e970OOO0O0 a year; including the rent