New-York tribune., 1919-05-24
The Railroad Mess
To the Editor Of The Tribune.

IN. Inc IrSSlQenL announcement that
- the railways will be returned to their
owners at the end of 1919 in effect
loads upon the present Congress the task
of cleaning up the mess which has re.
suited from governmental administrator
Of railroads during the war. l do not sug.
gest that this mess is wholly, or even in
part, the result OF incompetence on ths
administration part; the fact is, how.
ever, that at this moment the railroads 0!
the United States are in bad physical con.
dtion, and their income accounts are il
state Of dislocation that if unremeded
will result in very serious consequences
to their owners.
1t is customary to talk OF the railroad
problem much as if the question of whist
should be done were really difficult Of
solution. This is plain humbug 1t Is
not that we do not know what should b
done with the railroads under private en-
terprise so much as it is that we are
afraid to do it. We believe that good ser
vice can only be had under system Of
private enterprise, and this means private
enterprise in the development, the fnanc-
ing and the operation of the railways. We
believe that to get the full benefits from
private enterprise it must be allowed tha
greatest possible freedom of action con.
sistent with protection of the public
Transportation is a public service which
touches so intimately the lives of every
one that we all admit that there must be
a sufficient measure Of public control to
assure US against exploitation. Therefore,
what we have to do is to balance private
enterprise and public control at the point
Of efficiency and economy in the produc'
ton of service.
This boils down to one thing, and one
thing only, and that is the matter of rates,
and the matter of rates boils down to Just
one thing, and that is the matter Of
courage on the part of the man or men
to whom rate regulation is intrusted
Private enterprise in transportatlon
means individual initiative in the develop
ment and extension of railroad facilities
1t means provision of new capital by ns
voluntary act of those who own the caF'
tai 1t means that the opportunity ioi
employment of new capital in transports
ton must be sufficiently attractive to COM
pete with other opportunities, and II
means that the profits in the transports
ton industry must be large enough 70
furnish this attraction. Now, the root Of
the trouble with the transportation inous'
try in America is that the regulating aa'
thority has failed to make the railroad m
dustry attractive to private capital. Inc
reason that it has failed to do this is tna'
it has not had either the vision or the
courage to make rates such that railros'
profits were large enough to attract ih'0
the industry the capital that the indusuy
should have had
In my humble opinion there is no miod''
course between complete government cor
troll of railroad development and opeis'
ton and development and operation
private enterprise. Virtually every scneH'
for working out middle course arlss'
from the belief on the part OF n'
author or authors that it is hopeless
expect from the regulating authority rave
large enough to make the railroad ino''
try an effective competitor for capits' -
the investment market. Railroad secure
holders as such can accept with equanim"'
almost any scheme of guarantee thai "''
been suggested; they have little or nOs'.
ing to lose thereby. But, under on,
scheme Of guarantee. the inevitable fes'''
will be extension of the dead hand o. GU.
ernmental control over the dsveiopme"'
and operation of our railroad industry y
the ultimate dctriment Of every one
do not know whether it is possible y
expect. in a democracy like ours. any p1'
lie official or group of officials TO have ~
courage to regulate rates in such W.
as to enable the railroads to receive a@''
healthy growth and vigorous effcieh' ~
Grafton under private enterprise. No'h"'S
IN cur experience so far warrants 10
believing that such thing Is possl0'N'
We should not, however, deceive ourse"s
into believing that we can get what we a,
know to be the benefits OF indlFl'ss'
initiative as against governmental inei"ss
in any other way. At least, let Us ''ss
the facts squarely in the face.
THOMAS T. wooDLoCa. q
New York, May %, 1919.