Rock Island Argus. (Rock Island, Ill.) 1893-1920, 1919-01-03
REASONS
U. S. HOLDING
ROADS GIVEN
McAdoo Explains Plea for
Five Year Control
Promises Rate Cut.


nance of government operation &c
provide a fair test of unified dl
rection were recited today by Di-
rector General McAdoo. testifyinG
! before the senate interstate COM
/ merce committee which took VI
! consideration of his recOmmenda-
{ ton for extension of control until
I 1924.
/ Mr.. McAdoo read a prepared
statement more than $4,000 words
! in length, constituting a review o
! conditions. He planned TO take
most of the day in presenting the
testimCny-probably the last pub
| tic statement of his stewardship OF
| railroad matters, before retiring rs
directorgeneral.
After citing reforms effected I'M
! der unified control the director =
general said: Il believe that under
/ the handicaps of wal conditions a
sufficient showing has Oeen made
to indicate that all the reforms J
have mentioned az desirable as
permanent peace assures. Yet it
is clear that the general public
| has not had an opportunity to APP
pl ldAtf IAllS anu W llit L CO
! value of what has been accom-
plished.
Need Time for Fair Test.
ct will be impossible 90 review
the results of even one year OF
federal control under peace condt-
lions until the spring of 1920, and
it will then be too late for con
gress TO legislate before the end OF
the 81 months period after the
declaration of peace. provided ii
the present law for government:
control. Operations under peace
conditions with a tenure SO short
as the 81 months cannot possibly
constitute ~ fair test
Void Hf;fa = ~ Il I s Efasss.
10 employees morale. the difficulty
of carrying oHt an extensive pre-
gram Of improvements and o.
forcing on railroad companies nee
essary expenditures.
Not Step to Ownership.
Indeed" ne added. the Difficult =
ties with operation during the 81
months period will be SO serious,
that l do not see how the govern
ment can be fairly asked to en-
counter them. 1t seems tc me that
anyone who wishes a fair and dis
passionate study made IS to what
is the best ultimate solution. and
as To the extent to which the re-
forms | have mentioned are in
the interest of the American pub
lie and as to the way in which
those reforms can best DE accom-
plished if in the interest of the
American public-must be anxious
to have a. reasonable period OF
federal control after the war un-
der conditions calculated to make
for tranquility and singIe-mindeG-
ness upon the part of the fedora!
railroad organization. [ dc not
mean that this would be desired il,
order to accomplish government
ownership"
Another reason for a longer test
period, said the director-GGneral, IS
the advisability Of having adequate
information on valuation Of rail-
road property, now being gathered
mission to guide congress in leg
AoAANAoiA piDN AoIhS "a Pei Lild ltlls
solution OF the railroad problem.
VIII Cut Rates This Year.
Referring to the Increase in
freight and passenger rates SIN
months ago, Mr.. McAdoo said that
similar action would nave been
necessary even under private
management to prevent substantial
losses. and said it would be pos
sible to lower rates materially this
year.
Satisfactory and equitable distri-
button of the rate burden over AL
railroads regardless of the fact
that some are unusually prosper
Gus and others poverty-stricken. Is
possible only under unified control,
Mr.. McAdoo urged as another ar
gument for the five year cohtin-
uance plan.
Great Improvement and extern
sions should be made in termina,
facilities by enlargement and con-
structiOn. said the director. This.
he said. provides the greatest op-
portunity for reducing operating
costs and promoting public cor
venience in the future
Si36, 900. 600 Years OSs.
Mr.. McAdoO estimated the gov
ernment's loss in operating rail-
roads this year at Si36, 200, 900.
This represents the difference be-
tween the amount guaranteed 10
the roads as rental and the sums
credited to the government in
railroad income. If the higher
rates had been in effect the entire
year. he estimated. the government
would have made surplus OF
500, 100000 and in 1919. with
existing wages, operating costs
and traffic volume remaining sub
stantially the same as in last
year, the government should make
surplus of $100.000,O00.
Pays Despite Increased Costs.
"Since the objective OF the gov
eminent should be at all times to
operate the railroads not for profit
but at cost" he added. "and to
render at the same time the best