New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1919-06-01
Carlton Told
BurlesOn to
Take Cables
Western Union President
Testifies Before House
Committee He Believed 1t
Would Aid US. Commerce

WASHINGTON, May S1.-Newcomb
Carlton, president of the Western
Union Telegraph Company, testified
before tho House Interstate Commerce
Committee to-day that the transatlan-
tic cable lines were taken over by the
government last November after he
lad recommended to Postmaster Gen
eral Burleson that this be done for
commercial reasons.
This action on his part was based on
the belief, he said, that American bust
ness interests would be served more
advantageously through government
operation.
Last October" Mr. Carlton said, 81
told the Postmaster General that. in
my judgment, he was assuming great
political responsibility in taking over
the wires, because the service was
bound to decrease in efficiency and he
would be held responsible for things
he was not to blame for During nv
conference with him l suggested that
if he wanted to do anything which
would result in good for the country
he should ask the President to take
over the cables and expand the SER
vice so that American merchants and
the American merchant marine might
have direct communication to foreign
points on American cables, in order,
Tor one thing, to avoid the censorship,
and, for another, the unfriendly atti-
tude of foreign powe~s.
Seemed to Like Idea
81 don't know whether my recon-
mendation influenced the Postmaster
General in any way, but at all events
he seemed to like the idea Later he
conferred with the President, and the
cables were taken over"
Employees of the Postal TELEGRAPH
Gable Company are being demoralizcd
by continued government operation of
the telegraph, Edward Reynolds, for
mer general manager of the company,
/ told the committee. He asserted
emphatically that the Postal is ready
to drop back to the old rates on tele-
graph business as soon as its wires
are restored
Every days delay in turning back
the wires" Mr.. Reynolds said, "is hav-
ing demoralizing effect upon our
employees"
Mr.. Reynolds conceded that the tele
phone companies presented different
case and that it might be we'll to
deter their return to permit readjust-
ments. He said practically all the stock
in the Postal Telegraph Gable Com
pany and its thirty-nine subsidiary
companies IS owned by Clarence n.
Mackay and his mother.
II look for great prosperity in the
telegraph business next year" said
Mr. Reynolds. "The gross revenues
are now 35 per cent higher than they
were year ago, due partly to the 20
per cent increase in rates put into
effect by the Postmaster General
Will Ask No Damages
"The Postal Telegraph COMPANY de-
slres the immediate return of it's prop
erty and pledges itself on the date the
wires are turned back to 90 back to the
old rates. We do not ask the govern
ment to pay US any damages. We do
ask to retain what our lines have
earned during the period Of govern
ment control.
we nave no objection whatever to
rcfunding the increased rates All we
ask of the government is the actual
earnings Of our lines during govern
ment control. | wish to add that we do
not intend, either, to reduce the wages
of our employees"
Mr. Reynolds repeated his criticism
Of the Postmaster General for COM
pensating the Western Union on a
basis Of earnings and the postal on a
basis Of physical valuation. eve don't
propose to be treated differently from
the favorte of the Postmaster Cen
cral," he exclaimed "This attempt to
FIX returns on a physical valuation is
merely an attempt to keep us out of
just compensation