New-York tribune., 1919-03-06
Will Urge Roads, Crippled
by Fund Failure, To Bor-
row to Fulfil Programme
Refuses TO Raise Rates
Also Says Wages Will Not
BE Cut; Has Plan 10 Aid
Highway Work i'm States
Nc,o ork Tribune
Washington Buvcdu

WASHINGTON. March g. Discard
ing for the present all thought Of ro-
turning the railroads 20 the control
of their owners. the railroad admins
tration will ask the companies to bor-
row money on their own account to
meet difficulties resulting from the
failure of Congress to pass the rail
road revolving fund appropriation Of
$3.50. 100000.
Meanwhile. thcso assurances were
given to-day by Walker ID. Hines,
Director General Of Railroads.
I Ho will urge the railroads not
to abandon the programme of
improvements and betterments and
thereby add to the nations labor
problem.
, There will be no Increase in
freight or passenger rates nor
curtailment of wages to meet the
situation, which is not a problem
of operating revenue, but of financ-
ing capital expenditures
state
governors and mayors here this after
noon, Mr.. Hines said:
There would be two general wavs
IN which we might attempt to adapt
ourselves to this new situation. One
would be to cut down expenditures "a
rapidly as possible in every direction.
even though these expenditures were
highly desirable. The other way would
Dc to try to resort to every possible
expedient to prevail on the railroad
companies and other business interests
affected to borrow money to enable us
to go Harvard with these expenditures.
and l am emphatically in favor of the
plan which contemplates financing
these matters so we can go forward
with the expenditures rather than Of
the plan Of cutting off the expenditures
30 we can avoid the financing.
From every standpoint it eeems to
me this is the proper and expedient
course to pursue. am absolutely ont
OF sympathy with any policy which
contemplates the slowing down of in
dustries for the purpose of throwing
men out Of employment on the idea
that thereby the rates OF wages may Sc
cu- down for the future.
Approaching the matter along these
lines, it is going to be my policy, and
with the most cordial cooperation Of
the Secretary of the Treasury and OF
the War Finance Corporation. to try
to find every way we can to reimburse
the Treasury and the railroad admin
tstration through getting the corpora
tions to borrow the money to pay back
advances which have been made and
which it will be necessary to make"
Incidentally be informed his hearers
that he has under considerable a pro-
posal to reduce freight rates on road
building materials in order to encour-
age the various states and communi-
ties in road construction.
Mr.. Hines made no effort to conceal
the fact that the failure OF the rail
road appropriation has nccessitated a
complete reorganization Of the pro-
Rrammc OF the railroad administration
in dealing with financial problems.
At the same time it was evident in
railroad administration circles that
there Is no thought of 9rging the Pres
Ident to call an extra session Of
tongress sooner than Anticipated in
order to get through tho revolving
fund appropriation.
How u Could Re Borrowed
II IL understood tho tentative plan
~ To hnvo tho roads borrow tho moncv
both from private banks and from tho
War Finance Corporation. This cor
porntion. It was learned TO -day. haa
only loaned $i70,000,00O OF the $500
100000 authorized. The balance of
s32l 100000, it is thought could hc
borrowed by the soads to reimburse tho
railroad administration for advances
which IL has made, and thus enable tho
railroad administration in turn ia
pay up us Indebtedness to the roads
on account of guaranteed rentals.
IL is emphasized in responsible quar-
ters, however, that it wall be the policy
OF tne Administration to DISCOURAGE the
issuance OF new securities, the effect
OF whieh might be to disturb the value
OF railroad stocks and bonds already
outstanding. Similarly, there will be
no dumping on the market of securi.
ues held by the various companies.
:. Regarding the flibuster which killed
the $75O,000,00o appropriation Mr.
lines. in his address to the governor,
end mayors this afternoon, said:
IN studying this matter we felt
we had promising programme which
would go far toward meeting the i'm
portant necessities Of the presen.
situation We contemplated that W.
could keep up our maintenance of the
,a'i'oaos TO the standard which thex
. nAd tahlished during the three wear,
ennihg June 30, 1917, and that we
would also be able to 80 ahead ar
substantial, though conservat;v
scheme of improvements.
Confronted by New Problem
Our programme az originally
pianhen' rested upon our anticipation
ina. we should get the sppropriatiou
ei sioo,Ooo,o 600, for which we had an.
piied 10 Congress Yesterday at noon
we were confronted with the probIem m
OF endeavoring TO remake our pro
gramme in the face of rao cally dim.
cult conditions from those we had AN.
ticipated, and / come before you TO-
day 70 tell you In very few words
what now see as the outlook for the
rsjlrcad administratjo1 in DEALING
with these important rroblems.
Il approach the matter In the spirit
that 1t Is my clear duty from every
standpoint 70 try, notwithti nding the
failure Of this appropriation, TO find
way 70 accomplish the things VIII. IN