Arizona republican., 1919-03-06
H|NES|SFAC|NG
 R. .R. D|[EMMA|N
 GR|TTYEARNES7
Attitude Of Pessimism Charge To Optimism Says Roads May Borrow
 Failure Of $750, 900, 900 Bill Impairs Credit-Vic- tory Loan A Hindrance

tory Loan A Hindrance
 WASHINGTON, Mar. 5.-The gov ernment today determined to retain control of the railroads, despite fail ure of congress to provide funds for the railroad administration, and to have the roads finance themselves for the next few months through private loans on the open market, or through advances by the war finance coTpor- ation.
 Efforts will be made to maintain on a normal scale and to carry on as much of the improvement as possible, in order to avoid throwing employees out of work or oth- erwise disturbing industrial cndi- tions. No attempt will be made to solve the problem by raising rates.
 These assurances were given by Di- rector General Hines in a public state ment and in an address to the confer ence of governors and mayors meet ing here. At the same time it devel- oped that the war finance corporation has about S337, ,000, 900 resources avail able. and much of this may go to rail roads to supplement the sums they can borrow until congress meets agair and has opportunity to appropriate funds.
 After protracted conferences be- tween Secretary Glass and other of ficiais of the treasury and war financ, corporal ton. it was stated that mean' probably would be developed to lleel the railroads off the money market a! much as possible and minimize inter ference with the forthcoming Victory Liberty loan.
 Although officials appeared optimis tic. they explained that much manipu lation of financial machinery would b. necessary and a definite program coult not be developed for some time.
 Attitude Has Cleared.
 Their somewhat cheerful attitud was in contrast to the rather pessimis tic utterances of Secretary Glass ant Director General Hines before the sen ate appropriations committee in execu tive session last week. commenting ol the possibility of the failure of the ap propriations bill. The text was mad public today.
 There will be two general ways il which we might attempt to adapt our selves to this new situation so sudden ly created said MT. Hines today, ad dressing the conference of governor and mayors. "One way would be | cut down expenses as rapidly as possi ble In every direction, even thoug these expenditures were highly desir able The other way would be to tr n n to prevail on the railroad companie and the other business interests af fected, to borrow the necessary none to enable us to go forward with thes expenditures, and I am emphaticall in favor of the plan which contem plates financing these matters so W can go forward with the expenditure rather than with the plan of cuttin off the expenditures, so we can avoi the financing. l am absolutely out ( sympathy with any policy which con templates the slowing down of indus try for the purpose of throwing me out of employment, on the idea tha thereby the rates of wages may h cut down for the future.
 Approaching the matter along thos lines, it is going to be my policy an, with the cordial cooperation of th secretary of the treasury and of th war finance corporation, to try to fin every way we can to reimburse tr treasury and the railway administra tion, through getting the corporatio to borrow the money to pay back ad vances which have been made, an which it will be necessary to make, { carry out our program. It is going 1 be very difficult but we are approach ing it with the determination that W will make it succeed in a very lare extent and that We will get a lare measure of patriotic cooperation frol all the interests which are affected.
 Hines Issues Statement. In a statement, Mir. Hines said:
 Tn connection with the considerable of this question, there has been no di: cussion of raising rates, either pa: senger or freight, because the mone derived from rates goes into operatir revenues which primarily are not al fected by the present situation. Tn connection with necessary f nancing, which will have to be dor by the railroad corporation, it is fl rule that no such corporation finan, ing be undertaken except on certif cate of the railroad administratio and therefore the railroad administr; ton, in sense, acts as clearir house for such financing, thus min mixing the danger of financial COT | fusion
 Before the senate appropriatio, committee, Secretary Glass said la week that failure of the measure a, propriating s75O.0OO,O0O for the raj roads would be disastrous and q, moralizing."
 Tt will create the situation in raj road circles" he said, that will amou | to practical suspension of activitie | interfere with the purchasing acti- ities of the administration. It will ve greatly impair the credit of the raj roads. The only alternative that I S would be to have the railroads go O into the open market and make loai aggregating nearly one billion dolla from the banks. That condition won reflect itself on the Liberty loan and think in a disastrous way
 | MT. Hines expressed similar viey before the committee. It was explai
 ed today, however, that with new a rangements for financing the roaS the -pessimistic views expressed tn
 do not necessarily hold now.