The news scimitar. (Memphis, Tenn.) 1907-1926, 1919-02-03
H|NESOPPOSEDT TO
|. j. S. OWNERSHIP
Of BIG RAILWAYS
New Director General Ap-
pears Before Committee for
First Time and Gives Views
on Big Problem.

WASHINGTON, Feb, 3,--Director-
General Hines, testifyiug today before
the senate interstate commerce COM
mittee for the first time since hts ap-
polntment as railroad head, declared he
did not believe in government owner
ship, but in Organization OF a few big
railway companies subject 10 close gofA
ernlnent Supervision
II do not believe there is anything
substantial in the argument that five
year extension Of government operation
would necesSarily mean government
ownership" MIR, Hines said y do not
personally believe in government own
erShip, l believe there can be a form
Of radically reconstruoted private own
ership with such close government SUI
pervision, including government repre-
sentation on the boards OF directors as
will give the public and labor all hem
eflts Of government ownership and at
the same time will preserve the bene-
fits OF private and self-interested in
ltiatiye and will avoid political difficul.
ties which perhaps are inseparable from
government ownership,
81 believe that all the objects which
! think must be achieved in order to
obtain a permanent solution can bs
accomplished through the creation OF
comparatively few railroad companies
which viii have capitalization equal
only to the real value Of the property,
and which win have q moderate guar
anteed return with the right TO par
tiolpate moderately in any additional
profits"
Renews Request.
To permit Of comprehensive ard
permanent solution, Mr.. Hines renewed
MIR MeAdoo's recommendation for q
five-year extension of government con-
trol and explained that II this were not
done he believed Ii would be hest for
all interests concerned to relindulsh
government control without waiting for
expiration ef the p ninths' period pro-
vided by existing law.
1T seems to be unmistakable. he
added, that any suggestion Of early
REIMBURSEMENT should be put forward
as n leverage for forcing an extension.
| think the entire subject ought to be
determined by the logic OF facts"
No far as physical operations are con-
eerned, said the director general, there
10 now no emergency which calls on the
| goyernment to continue control OF the
| railroads.
Mr.. Hines presented the following ar
| ghments fora flve-year extenston'
II viii give advocates OF government
| ownership full opportunity to press
| their views without being influenced by
| the temporary reaction against gov
| ernment control,
II will stabilize employment and wage
| condltlonsi permit prosecution OF big
program of improvements and exten-
sion, help to take up the slack In eli.
ployment and materials during the crit
ical period OF readjustment.
1t will protect security holders pend
ing an ultimate solution
1t will minimize the danger OF max
ing the railroad question q purely parti-
san Issue to be considered in an illog-
ical manner In the presidential elec-
tions
The uncertainty of the future on the
part OF the employees would Increase as
the 81 months period would draw to q
close, 'As
Twenty-one months Is not enough
time to complete many extensions and
improvements, and II would be hard
s0r the givernment TO undertake such q
program which would not show results
during the control period,
Early REIMBURSEMENT would not cause
any more chaotic conditions now than
later, even under legislation providing
reform scheme.
Old rates would not 60 into effect au-
tomatically with cessation of govern
ment control, and railroad companies
would not be thrown into bankruptcy
as has been feared.
Due to War.
AT present, said Mr., Hines, the un-
fair inference Is persistently drawn that
the heavy operating costs are necessa-
rily due to increased rates OF wages,
whereas they ara largely due to war
conditions, and the position OF labor In
this matter should not be prejudiced by
forcing a conclusion before there is tins
to see the results Of increased wages
under peace conditions.
Since last year was under abnormal
war conditions, this year involves rQN
adjustment, and normal conditions WIZ
not be until next year, he declared, Mnd
It will be the middle OF 1891 befor$ n
fair view OF government operation tan
be obtained
No plans now before the commtttee
meet the fundamental necessities yAof q
permanent solution. said the director
general w
The present plans. he asserted, In
clude all existing railroad companies.
both those which thrive and those
which fail on high rates, thus putting
the public to a disadvantage through
paying too much to some and getting
Anadeqnate service,
4 nermanent solution, Mr., Hines said,
should give the government. aand per-
haps labor, participation In excess prof
It's OF some companies under standard
rates Plans heretofore proposed were
based on the theory that railroads
should receive reasonable return, no
more and no less. but in actual results
he believed the return would be inexact
and widely fluetuating. He added that
proposed plans for pooling and consoM-
dations win prove illusory because they
can not successfully be made compui-
sorry.