New-York tribune., 1919-02-04
Hines FayOrs
5-Year Test
OF Railroads
New Director General Says,
However, He Is Opposed
to Federal Ownership
Suggests Control Plan
Also Tells Senate Committee
Shippers Have Organized
a Propaganda Campaign
New York Tribune
Washin0t09, Bureau

Neu YorL; Tribune
Washington Bureau
WASHINGTON, Feb. 3.-Walker D.
Hines, Director General of Railroads,
declared himself to-day in opposition to
government ownership of the railroads.
He told the Senate Committee on Inter
state Comme rec, however, that govern
ment ownership should be given a fair
test. For this reason, among others,
he said, he supported the proposal of
his predecessor in office, William G.
McAdoo, that the period of government
control Of the roads be extended from
twentyone months, as now specified in
the Federal control act, to five years.
"l do not personally believe in gov
ernment ownership" he testified
There can be form Of radically re-
constructs, private ownership with
ing government representation on the
boards of directors, chat will give the
public and labor all the benefits of gov
crnmen5 ownership and at the same
time preserve the benefits Of private
and self-lnterested initiative and avoid
the political difficulties, which, perhaps,
are inseparabla from government own
ership."
Not Speaking for President
81 am not authorized to speak for
the President, and indeed he has
never expressed any view on the sub
ject to me-" said Mr. Hines.
Briefly put, Mr.. Illness proposed
solution of the problem is to create a
few railroad companies in place of the
many that now operate, place them
under private ownership and opera
ton, but reduce their capitalization to
correct proportions; provide a guar
q moderate participation in additional
profits above a fixed return.
Advocates of government ownership,
he said are entitled to have their case
considered on it's merits and not en-
barrassed by q necessary misleading
showing of the conditions Of the pres
'cnt Federal control. Peace time at
mosphere, he contended, was essential
to fair test.
The experience of the war year is
not vet fully available and the present
year is year of readjustment. The
year following probably would be fair
iy normal as basis of judgment, ne
said The results Of these years ought
all to be available, as they will be by
The spring of 1921, before final judg-
ment on the general proposition can
be reached.
Asks for Full fest
tI do not believe there Is. anything
substantial in. the argument that a
1--we wear extension of government op-
necessarily mean gov
;rernment 6wnership,"s Mr., Hines said.
81 do not personally beheye in gov
ernment ownership. believe there
can be a form of radically recon
structed private ownership with such
close government supervision, includ-
ing government representation on the
board Of directors, S will give the
public and labor all the benefit of
government ownership and at the
same time will preserve the benefits
of private and self-interested initiative
and will avoid the political difficulties
which perhaps are insparable from
government ownership.
81 believe that all the objects which
7 think must be achieved in order to
obtain permanent solution can be
accomplished through the creation of
a comparatively few railroad compa-
MES, which will have capitalization
equal only to the real value of the
property and which will have mod
crate guaranteed return, with the right
TO participate moderately in any ad-
ditional profits"
Wants Change At Once
To permit development Of COM
prehensive and permanent solution, Mr..
Hines renewed Mr.. McAdoo's recon-
mendation for fye-year extension Of
government control, and explained that
If this were not done he believed it
would be best for all interests con-
cerned to relinquish government con-
troll without waiting for the expiration
Of the twenty-one- month period pro-
vided by existing law.
at seems to be unthinkable," he
added, that any suggestion of early
REIMBURSEMENT should be put forward
az a leverage for forcing an extension
] think the entire subject ought to be
determined by the logic of facts"
Discussing the reasons for taking
more time for considering legislation
he said:
"a avery strong feeling prevails that
this question is being pushed now by
the railroad executives because they
feel that the going is particularly
good and that they had better make
private management hay while the
anti government ownership sun con-
tinues to shine. do not believe solu-
tion in this spirit is going to satisfy
the public"
SO far as physical operations are
concerned. said the director.general,
there is now no emergency which calls
on the government to continue control
Of the railroads. he explained that
? the methods adopted by the railroad
administration during the war now are
open TO reconsideration in the light of
/ peace conditions, adding that this had
been Mr.. McAdoo's attitude.
Backs McAdoo's Plan
Mr.. Hincs presented the following
arguments for fve-year extension:
at will give advocates Of govern
ment ownership full opportunity to
press their views without being in
fuenced by the temporary reaction
against government control.
"lt will remove the necessity for
undue haste in solving such a big
problem as the future of the railroads.
1t will stabilize employment and wage
conditions, permit prosecution Of big
programme Of big improvements and