The Glasgow courier. [volume] (Glasgow, Mont.) 1913-current, 1919-05-30
MORE MONEY NEEDED TO
OPERATE RAILROADS
81, 200, 100000 Appropriation Asked for
Not Enough if Loss Con-
tinues.

Washington, May 24.-In request
ing an appropriation of $4,000 900 900
to finance the railroads for the bal
ance of this year and to pay the gov
ernment's operating loss for sixteen
months up to this month, Director
General Hines said more may be need
ed later if the government continues
to lose heavily in operation.
The $1,000, 100000 is in addition to
the $500, 600, 900 which failed of APP
preparation when the session ended in
a filibuster.
Will Pay Railways.
Out of this appropriation, which
congress will be asked to expedite,
railroads will be paid the sums due
them months ago as standard COM
pensation and for which they have ac-
cepted the railroad administrations
certificates of indebtedness. On Sc
curity of these certificates they have
borrowed from banks and the war fl
nance corporation to meet their cur
rent corporate obligations in recent
months. This temporary system of
financing will be eliminated as soon
as congress provides funds.
Approximately S4s6,000,0 900 repre-
sents the governments loss in operat-
ing the railroads from January l,
1918, when private control ended, to
May l. This is the difference be-
tween the sums for which the govern
ment is obligated to pay the roads
on contracts and the net actual OPP
Grating income from operations.
Blames Deficits to War.
Mr.. Hines said that in his judgment
the operating deficits for 1918 and
for the four months in 1919 were
clearly due to the war and to abnor-
NAL after-war conditions. Because Of
the present changing conditions he de-
clined to make any prediction of the
financial results of operation during
the remainder of the year.
Mr.. Hines letter which was writ
ten to Secretary Glass and transmit
ted by the latter to congress, said:
"The operating deficit of 1885, 1884,
$40 for the year 1918 vas due largely
to two facts: First, the winter of
1918 was unprecedented in its severity
and in its costly effect IN railroad
operations; and, second, the increases
in passenger and freight rates, aver
aging about 25 per cent, were in eff
feet for only a few days in excess of
six months, while heavily increased
expenses, due to war conditions, were
effective on an ascending scale dur
ing the twelve months.
S25O,OOO,O0 Shy in 4 Months.
"The operating deficit of approx
imately $3.50, O0O, 900 for the first four
months of 1918 is due in part to the
high levels of cost brought by the war
for labor and materials and in part
to the sudden and abnormal falling
off of business as a result of the ces-
sation of war activities, the sudden
drop in the demand for fuel for other
basic commodities and the general
state of transition from war conditions
to peace conditions, the fact that the
present period is transitional and ap-
%parently on the eve of important
| changes has made it e%Xpedient to de-
fer, until the matter can be more ac-
%curately measured the consideration
of the question now frequently ralsec
of an increase in rates.
"In my judgment the deficits fol
1918 and for the REIMBURSEMENT perlot
of 1919 are clearly losses due to the
war and ought to be treated as such
By reason of the abnormal after tn
war factors tending to importan
changes in the situation the estimate
herewith submitted does not attemp
to forecast results beyond the frs
four months of this calendar year.
the amount here requested shall b
appropriated, the total appropriate
for the railroad administration WI
have been 81 ZOO, 100000.
900 900 Should Be Returned.
"Of this amount 81 ,214, 900 900 wi
represent amounts which should b
returned to the government, S42o,ooo
600 thereof being temporarily tied u
in working capital and S775,OO0,OC
!, thereof representing amounts who
have been and will be advanced IL
: the account of the railroad corpor;
!, tions and which it will be their dut
, to repay as rapidly as practicaol
5 About $4,000, 900 will represent e.
penditures for equipment on inlar
waterways.
f "The sum of approximately S22s
= OOO, 900 for increased working capt.
:. is requested because experience nj
demonstrated that the amount OF ca
= ital actually available for current u
on December, 1918, was insuttlcleI
4 to admit of the free and unrestrlct'
payment of pay rolls and vouche
4 f ro....xtfh uotttiowork-materl
- for n,.tarialc and sunplieS thrOughO'