The evening Caledonian. [volume] (St. Johnsbury, Vt.) 1918-1920, 1919-01-03
MAY RETURN
RAILROADS
ON APRIL |
Report that Government Is
Planning a Gradual
Withdrawal
RELEASED SINGLY
OR IN GROUPS
This System Regarded as
Easieset Way to Meet
Readjustment

New York, Jan. 2-That the Will
son administration has about deter
mined to release the railroads from
federal control, beginning April l, is
the information, regarded as very re-
liable, which today came to the high
est financial interests here The plan
is not to turn them back in body to
the company control and operation,
but to return first one railroad, then
another, and so on to gradually with
draw the government from the posi-
ton of control, operation and respon-
sibility which it took at the close of
1917.
1t is understood that the authorities
have come to this plan Of gradual re-
linquishment of the railroads to their
owners and private operations as af-
fording the easiest way to let go, and
with the idea also that by such meth
Cd the transition from federal to pri-
vate operation can be accomplished
with less readjustment than if the en-
tire railroad system of the country
should be turned back under one
general order as it was taken over.
The proposition is regarded both
favorably and otherwise. The prime
objections are: First, that there is
likely to be doubt as to which systems
shall be turned back; second, that if
weak companies are suddenly left to
themselves they might be in financial
difficulties, and third, that while the
general routing of the bulk of all traf-
fic remained under federal orders,
separate companies would be at the
mercy of federal direction without any
Of its protection.
On the other hand, it is not pre-
sun1able that the government, even to
escape fronTsthe difficulties and actual
burdens of the situation it finds itself
in after year of control, will delib-.
erately act in ways to jeopardize the
important interests represented by the
railroads, both as to service and capi-
tai investment.
It is assumed that the gradual re-
turn idea, if it shall be finally applied,
would be worked out on basis to re-
lease the different companies as they
can be freed without endangering
either service or solvency, so that
neither the public nor the security
holders would suffer
Such release would probably result
in larger financial burden for the
government to assume as a result of
its control, operation and guarantee
of the railroads, for it would mean
that those properties more than earn
ing their way would be released and
the government would lose the sur
plus income which it derives from
them, while it would still have to car
ry those running with deficits, which
number many, despite the increased
rates established under federal con-
troll to meet the greatly higher wages
granted and the advanced costs of all
supplies.
The President can hold the rail-
roads for 21 months after peace is
signed, or he can, in his discretion,
return all or any of them a. such
earlier time or times as he shall see
fit. This can be done whether or not
contracts have been made, so that
probably those few companies with
which Mr. McAdoo has signed con-
| troll contracts are not in materially,
if any, better position than the large
number yet waiting upon Washington
to arrange and conclude contracts.