The watchman and southron. [volume] (Sumter, S.C.) 1881-1930, 1919-12-20
RAILROAD GROWTH
A NATIONAL NEED
Railroads Under Private Owner
ship Will Need More Money
and Higher Rates Seems
Certain

New York. Dec. 14.-Thon1as De-
Witt Cuyler, chairman OF the Asso-
citation Of Railway Executives, an
nounceG today that tie fundamental
iacts of tne railroad situation would
be presented to the country by means
OF national advertising. The opening
statement. TO appear in the daily
newspapers during the next few days,
IS signed by nearly hundred execu-
tives of the principal railroads. 1t will
ec followed by a series Of advertise
1ncnts in the daily and weekly news
papers and in other publications.
THE unn1istakable verdict Of pubic
opinion" said Nh Cuyler, in making
the announcement Of the plan OF the
railroad companies. lis that this great
national industry shall continue TO be
conducted by private companies under
strict public regulation. Modern rail-
road companies, Of course. are not
private affairs Their capital IS SUD
scribed by a vast number OF lndWld-
ual investors as we'll as by institutions,
such as savings banks and life lnsuT-
ance companies. holding the savings
of millions OF people, and they are
subject to the most minute regulation
by the public authorities. In Europe
such corporations are called public
companies, and this name more ac-
curately describes them.
With the return of the railroads
to the control of their owning COM
panies, after two years of war service
under government eperation-a pc
riod of unprecedented industrial and
fnancial .change-tl1e railroad mapag-
ers will have many difficult problems
to face But the most important
probIem-the one most affecting the
public ,welfare-will be that Of. at
tracing to the railroad business
flow of new capital, without which the
railroads cannot grow and without
which the country cannot grow.
The whole railroad problem Sits
down to this fundamental fact that
in a growing country like ours, with
the transportation demands increas-
ing mucl, faster than the population,
there must be a continuous invest
ment of new funds in the expansion
of railroad facilities.
Railroad freight traffic reached
200 billion ton-miles in 1906; it rose
to 800 billion in 1913; and last year
it crossed the 400 billion mark. The
railroads are now hauling five times
as much traffic as they did thirty
years ago. And traffic is going to keep
right on growing, because this coun-
try is going to keep right on grow
ing.
sTo keep pace with this increase in
business, the railroads before the war
were expending about S500,000,0 900 a
year of new capital for expansion.
That, as we all know, was not enough.
But railroad earnings were not large
enough to attract the funds Of lnveS-
tors in greater amount. In fact for
several years the market for new rail-
road stock had vanished. Nearly all
the new capital had to be obtained
through the sale Of mortgage bonds
and short-ternl notes. The companies
were obliged to increase the number
Of their creditors because they could
not attract more sharehoif
buTlllS ll.O pei Aot VI "S@1 SSAASAO|
the government has been unable to
keep up normal expenditures for rail-
road up1uiiding. Last year the labor
and materials had to be devoted to the
prosecution ,of the war, and this year
the government has not had the mon
ey to spend. So with the return Of the
roads 10 their owners, the manage
nlents will be faced with the neces-
sity of very large capital expenditures
for betterments and improvements.
And this work will have to be done
at cost for labor and materials about
double what it was before the war.
New capital expenditures at the rate
CT $1,000, 100000 d year would there
fore seem to be the minimum requir-
ed required if the railroads are to
be enabled to handle the growing traf-
fic Of the country.
"To attract the now capital for up
building the railroads. the z1ranspor-
tation industry must be able TO earn