Evening journal., 1919-05-07
RAILROAD Deficit
IS S4lS,0OO,O0O.
total OF $l92. 600. 900 Ac-
cumulated First Three
Months of This Year
RECONSTRUCTION is
BLAMED FOR LOSSES

WASHINGTON, May THE railroad
tefcit piled up by the government from
January 1918 TO April 4 1919 for the
irst fifteen months OF federal control
IS slisOO0.Ooo or this amount s226.0oo-
800 forms the deficit Of the year OF 1918.
while the astounding total OF si92. .0oo.-
700 has been accumulated as a deficit
ior the first three months Of this year.
These figures We're authorized by
Director General Hines yesterday short
Is after estimated by the Bureau OF
Railway Economics. compiled from In
terstate Commerce Commission reports,
disclosed that the deficit OF the class
roads Of the country for the first quar-
ter OF 1919 amounted 10 nearly Si33,-
100000. The director generals fis-
ures include not only class roads
but all other railroads under federal
control. the expenses OF the central and
regional administrations and the oper-
alton Of the inland waterways.
The disastrous showing OF the rail-
road administration for the flrst three
months Of this year Mr.. Hines sttrib-
uted 10 a sharp falling or in business
and the inability OF the railroads sud
denly TO adjust their expenses 10 the
period OF reconstruction through which
the country Is passing.
on the other hand, Mr.. Hines de-
clared the railroad organizations were
working TO readiust these costs and the
future months were certain 20 witness /
a substantial increase in business. |
with the revenues therefrom reflected \
IN tho net. because the cost will not
be correspondingly increased" Be /
also took exception TO the figures is
sued by the Bureau Of Railroad Econ |
0mics, because, he asserted. January. |
February and March always have earn
ed less as railroad months than three /
twelfths OF the return for. the year.
In summing up the situation, how
ever, the director general expressed
himself as opposed to an increase in
rates st the present time.
Conditions are too abnormal he
said, TO serve as basis for any general
change in The level OF rates and Il Is
preferable 10 defer action on that sub
sect until more normal conditions
obtain"
The figures OF The railway bureau
places the three months net operating
income for class roads, including
switching and terminal at s39,Si3OOO,
as compared with an average in the
three-year test period liOii-t0. OF
SIP, ,79S 900. The January deficit was
S37 10000. In February it was s35.
S28 900 and in March 10 amounted TO
S57. .327, 600. The net operating income
for March was si0,92iOO0. as COM
pared with the March average In the
test period Of S6s25i 600.
ri IL Hrnn Ia
declined very sharply In March, the
freight traffic falling 23,2 per cent. be-
low a year ago, as compared with a
d3.5 per cent. decline in February and
a 10 PEI cent gain In January. Oper-
atihg revenues were s3I6,3i5, 600, Gain ]
OF 20 per cent. over last year, while {
the expenses rose 222 per cent. 10
s3i6. 10000, leaving net revenues OF
S2957i,OOO, a loss Of 63.9 per cent. This I
left a net operating income, after tax :
es and minor deductions OF Si0,92 900, ,
q loss Of SO per cent.
The eastern roads failed in March TO
earn any net operating income. They )
had a deficit Of 81, ,2s3.0O0. The south y
ern roads earned 81, $4,000 and the :
western earnings were S7,7i9O00. These
earnings viii be even less when adjust
ments Of back wages are made for re- {
cent wage increases granted the train !
mems brOtherhoOds. These recent in
creases are adding about S5jO0.OO0 a 2
month TO operating expenses.
The comparison OF operating results
with the average for the same months I
in the three-year test period before the s
government took over the roads, are
made by the railway bureau as follows:
First quarter i9i5-i9i7 Increase or
1919 average decrease
Operating revenue: d
si.i25,07s,OOO sS2i, ,0iO,OOO $780,, ,06S, 900 :
Operating expenses: q
i,03i, $4,000 569,55i,O 900 I i62, 1000
Net operating income: r
39.siiO00 i72,79s.O00 + i32, 900 c
increase 81 per cent. :
increase, 81 per cent
4Decrease, n per 'ent.