Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1919-06-20
NO RATE BOOST AT PRESENT
SAYS RAILROAD DIRECTOR HINES

the railroad, given unit. of any
commodity, will buy more transporta-
tion now than it ever did before in
the history Of the country. A ton of
steel or bushel of wheat or any other
unit of any commodity will buy more
Transportation now than ever before.
1.-The result of that is that freight
rates at the present time, instead of
being higher than ever before, are lower
than before when tested by the value
of the unit transported and the amount
of transportation which that article
transported will buy. That leads a
great many people to urge that there
ought to be an immediate increase in
rates in order to meet the situation. /
have had the experience, which is rather
unique, of having various shippers come
to me and urging that railroad rates
ought to be increased to take care of
this situation. l don't suppose that
condition has ever existed before in this
country, where the shipping public has
voluntarily asked that the rates be in
creased. This is by reason of the fact
that there has been such striking OBJ
ject lesson, that railroad prices have in
creased to much greater proportion
than the rates have increased, and
therefore the railroad operations are
not likely to be self sustaining in bust
ness with no increase in rates
My position on that subject has been
that it is important for US not to in
crease rates more than it is absolutely
necessary, that it is very desirable for
us to form better idea than it is
possible for us to form at the moment
as to the extent to which the present
deficit will be eliminated by the ex-
pected increase in business. There is
reasonable promise that a relatively
large part of this deficit will be wiped
out as the business increases and l do
not think it would be in the public
interest to make an increase in rates
which would be unnecessarily higher
than would be required to take care
of the present deficit, when part of the
deficit in the future is likely to be taken
care of by an increase in business.
Desires to Be Cautious
MY desire is to be cautious about
this matter and to avoid any premature
action, because of my feeling that rail-
road rates are so pervasive in every
line of industry that any unnecessary
increase in rates is likely to result in
an unnecessary increase in the cost of
living: therefore l think it very i'm
portant to be reasonably sure of our
ground before we undertake to deal
with the rate structure, and | believe
it more to the public interest for the
time being for the government to carry
this deficit and let us carefully study
it, as to the extent to which this
deficit will soon be wiped out by in
creased business, rather than by an in
crease in rates prematurely and avoid
the danger of starting an unnecessary
cycle of further increase in the cost
of living.
''As I look at it, therefore, the pres
ent deficit that is being incurred is not
due to any exceptional or relatively un-
justifiable expenditure of the railroads
as compared with other lines of in
dutry, but is due rather to the fact
that the government is keeping down
the rates rather than putting them up.
Il want you to remember this fact :
When the government took possession
of the railroads not single railroad
was put under the direction of a man
who was not a railroad man. Almost
without exception every railroad was
left under control of the very same
operating men who had controlled il
under private operation and when the
present government control ceases and
the railroad shall be turned back to
private management these same men
will continue to control the railroad
operations. Some operating policies that
have been established by the, central
railroad administration are in effect and,
of course, these railroad men have been
controlled by these policies and par
ticularly is that true with reference to
wages.
Under the Old Order
"HOw are we going to prevent re =
currence of that situation which existed
when federal control began? will
try to give you in few words the situa
tiop under the old form of public regu-
lation Of railroads.
'In the first place there was a gen
eral rule by which regulation was to be
conducted on the general notion of a
fair return on fair value of the rail
road property, but the fair value was
not ascertained and the fair return was
not definite. Every man was entitled TO
his own opinion on each of these and
the result was thaf il was almost inn.