New-York tribune., 1919-01-05

McAdoo charged that there had been a
"pcrsistent effort to discredit Federal
control" through such comparisons.
Sees Test as Successful
Earnings, he insisted, was not the
proper angle from which to consider
the problem, but he declared that, given
opportunity to test it's worth during a
fiveyear period Of normal ace-time c
produce earnings that would compare
favorably with the earnings from pri-
vate management. In connection with
this discussion Senator La Toilette,
heretofore q silent participant in the
hearings, voiced decided approval Of the
Director Generals position.
Senator Pomerene, OF Ohio, Demo-
crat, wanted to know why the various
economies and improvements due to
unihcation could not be as effectively
tried out under private management of
the roads if Congress would remove the
barriers against such unitication in the
antitrust law.
McAdoo-If you restore diversified
control you cannot have uniiicatlon.
'Pomerene Mot if it were placed
under the supervision OF the Interstate
Commerce Commission?
McAdoo-f do not think the commits
sion could handle it.
Pomerene-The difficulty, as see
it, is that if Federal control under
your plan does not prove success at
the end of five years, the position OF
the roads at the end of that time will
be worse than ever.
McAdoo-My whole purpose in ask
ing the extension is to have falr
test.
Permit System Questioned
Senator Kellogg called Mr. McAdoo's
attention to the various economies Of
operation which the Director General
had referred to yesterday in his pre-
pared statement. including the permit
system, whereby the roads were not
allowed to accept shipments until given
proper guarantees by shippers that
consignees would be ready to remove
them promptly from cars at the point
of destination. He asked if it were not
a fact that many of these economies
were made possible through the exer-
else by the War Industries Board and
the food and fuel administrations of
emergency war powers, which were not
and could not be in effect during peace
times. Denying that these agencies
ratke er than the Railroad Administra-
ton, were responsible for these econo-
mics, Mr. McAdoo said that it would
probably not be as necessary to use
the permit system in peace time as
in war, though he thought the power
should be vested somewhere in reserve.
Kellogg - You said yesterday that
with the same volume OF traffic as that
moved last year, but with the eXtraor-
dinary difficulties Of the war situation
removed, the rates under Federal con-
troll could be reduced next year AS
a matter of fact, are you not right now
planning to increase rates?
Does Not Plan Increase
McAdoo-No. But certain inequali
ties in the rates previously fixed by US
are being adjusted, and in such adjust
ment some Of the rates are bound to be
raised.
Kellogg-Did you not in December
raise the rates on Pacific Coast lumber
from one to seven cents per 100
pounds?
McAdoo-I am not familiar with
these details, and may say that with re-
spect to many details it is impossible
for the Director General to keep per-
sonally advised. Such matters are
necessarily left to the division heads.
Kellogg-What are the normal an
nual needs Of the railroads for freight
cars?
McAdoo-I would have to look that up
and furnish you with the information
later.
Kelbgg-Is not the figure about
100000 cars?
McAdoo-About that, yes.
Senator Kellogg then submitted fig
ures of the Interstate Commerce Com
mission to show that whereas the rail
roads generally ordered beyond that
figure, only 14.6O0 of the 100, 900
freight cars ordered by the Railroad