New-York tribune., 1919-08-08

poffRt1On, instead or De1nE fen0ctet
in the price OF commodities, are appro
priated to swell the volume of profit!
Of those who control capital. Insure
rates to the consumer, and you will
have turned the tide that now threaten.
to overwhelm US.
"Can this be done without depriyinl
the owners of capital Of any Of theil
lawful or vested rights? AS applied te
railroads, this can be done easily, TO,
the property rights which exist in rail
roads are based entirely on grants
which the public made to the holder
of such privileges. Only that which
has been granted becomes private in
terest, that which was not granted re-
mains a public interest"
On cross-examination in regard to
his plan Mr.. Plumb contended:
1. That reduction of 5 per cent
in rates could be made at once
2. That in buying the roads the
government should pay only for the
original investment and not for any
~unearned increment"
3. That if the government bought
the roads at their real value stock
holders would get an average of
about Sc cents on the dollar. The
to twelve billions, their fictitious
value at about eighteen billions.
A. That by pooling equipment the
roads would be able to forego extern
sive additions to equipment for some
time.
5. That the roads would not be
amenable to political influence and
could be paid for quickly out of
l per cent amortization fund.
6. That states should be reim-
bursed by the government for the
loss of railroad taxes.
Condemnation Policy Advised
Members of the committee showed
the greatest interest in the matter of
how much the government should paw
for the roads. Mr. Plumb declared
taking the roads was condemning prop
erty for public use--the property
legally could be taken first and paid
for later. This he would do by means
Of a board of appraisal.
Ii railroad originally paid only so
cents an acre for its land, he said
that is all the government should pay
in return.
"The unearned increment was never
earned by the roads, but by the pub
lic,' he said, "and should not be paid
for. All cost values should be CON
sidered as Of the time required. A rise
IN the price of labor and materials can
not affect the value of labor and ma
teral originally bought"
This would be varied he said, only
as railroad charters varied. No char
ter granted anything not specifically
he declared, citing the case
Of an oil we'll developed on a railroad
in Oklahoma. Since the
acquired it's land only for rail
road purposes, he said, the original
owner of the land was able to obtain
possession of the oil we'll by court ap-
plicat;on.
Water Out of Stock, He Says
The value Of the railroads, he de-
clared, was not to exceed ten to twelve
Dillon dollars, but their fictitious value
was placed as high as eighteen billions.
The water already is wrung out of this
ne added, if any one tried to-day to
realize upon fictitious stock values.
IF the government bought the roads,
giving all stockholders an average Of
r about 66 cents on the dollar, that
would simply make a record Of an
elimination already accom- mplished
wouldn't 2" he was asked.
"Yes."
Mr.. Plumb added, however, that un-
der the provisions of his bill the
appralsing commission could value the
roads at $4,000, 900 900, but that such
4 decision probably would be fought
N the courts.
Mr.. Plumb's declaration that some
thing serious might happen in the
nature of a revolution unless decided
action is taken in sixty to ninety
lays resulted when the committee re-
minded him that last winter he had
favored fve-year extension of gov
control.
so rapidly of late that all my calcua-
ions fell down. he said. 1--WE have
made history in the past two years
hat ordinarily might take a decade
Public opinion is working faster We
nay expect any sort of social develop
nent within sixty to ninety days
Inauguration of his plan, he declared
would enable the roads to make an early
reduction of 5 per cent in rates, cut out
many useless employees, secure greater
efficiency by making it worth while for
employees to be more efficient, and by
Vlplng out deficit by eliminating
vatcred stock enable the roads to start
'ut with surplus.
Ihe change in railroad management
md ownership would be reflected, he
asserted, in the lowered cost Of living
or every one and not merely for one
lass. Congress would have TO curb the
orofitecr, he added, and profits on
relght should be eliminated