The Bridgeport times and evening farmer., 1919-08-15
BANKRUPTCY FACES RAILROADS WITHOUT HELP Johnson Asserts Congress Must Extend Steadying
 Hand. ONLY WAY TO
 INSURE PROSPERITY Ninety one Railroads Pass ed No Dividends What
 ever in 1916.

Washington, Aug. 15-If Congress proposes to build a foundation for American prosperity it must extend a steadying hand to the railroads, F'orney Johnston of the advisory coun- sel for the National Association oe Owners of Railroad Securities, told the House Interstate Commerce Com mission today.
 If Congress does not take coura ge- ous and construction action now" said MT. Johnston, appearing in behalf of the Warheld Six Percent Return Plan, "the progress of generation toward a well regulated system of privately owned and operated rail
 way transportation will be destroyed and the sixty-sixth Congress will have forced government ownership under conditions and with results which the future alone can assay
 MT. Johnston contended the Se- curity Owners Association had pre- sented the only process that would avoid this fatal and irrevocable step.'
 Pointing out that in 1919, ninety one railroads, operating more than eighty thousand miles, had paid no dividends whatever, he declared American railroads had been kept in | a bread line before the doors of the | Interstate Commerce Commission | since 1910, and that relief by the | Commission had been denied or 1 grudgingly and sparingly dealt out l because certain roads in each region | were thought to be affluent. | Yet before the commissions of Congress and in every case brought before the commission to advance rates" the witness said, "a vast mile lage of American railways has been | choked off with the assertion that av- craze stocks show average prosperity. In all of these cases the commission has been actuated to deny general re- lief because certain roads were pros- lperous and the commissio was un- willing to add to their prosperity even to save the large number of roads
 which were receiving admittedly in adequate revenue"
 | It was to meet this situation, he told the commission, that the War field plan would direct the commis-
 sion to fix rates so that the roads Icould earn minimum guaranteed re- turn of six per cent. upon capital in vested with division of all surplus over that figure among employees, the public and the earning road.
 The fundamental proposal of the | Warfield Plan" MT. Johnston declar. 1 ed, lis that this continual basis ot
 warfare between the shipper and the | railroads, the constant depressing 1 factor against relief before the com | mission when relief Is necessary must
 be removed by regulation of excess | earnings which will relieve shipping | organiza tions of their apprehension
 and the commission of the odiun
 which would be visited upon 1t il | affluent railroads were given higher | rates to protect American transpor-
 tation from bankruptcy"
 | In contending that Congress must | give constructive relief or else see | the railroads plunged into bank | ruptcy or government ownership MT
 Johnston said the Warfeld Plan of- | fered the lone solution upon which
 all conflicting elements in the situa-
 ton could unite.''
 1 We feel absolutely assured" he said, that in presenting the associa-
 ton plan we stand upon safe grounds 1 consistent with the constitution and
 with American traditions. While ii I is progressive in its acceptance of the idea of complete regulation we are | certain it preserves the incentive to
 good service, high efficiency and con- | sideration for passengers and ship | pers which no governmental organ ! ism or class organization would ac- | cord"