Grand Forks herald. [volume] (Grand Forks, N.D.) 1916-1955, 1919-01-04
M'AD00 SAYS
RATES WOULD
Be CONTINUED
If Roads go Back Legal Pro.
cedure Must Take Place
to Lower Prices.

Washington, Jan. 4.-Existing rate
schedules would continue if railroads
were turned back to private control
until changes were made by orderly
legal procedure, even where states
have specific rate laws, in the opinion
of Director General McAdoo, ex-
pressed today at the resumption of
the senate interstate commerce COM
mittee hearings on the railroad prob
lem.
The interstate commerce commits
sion has power to prevent discrimin-
alton in rates and this power could
be invoked. said Mr.. McAdoo, to pre-
vent inequalities between intra and
interstate rates. He called attention
to the fact that the courts have power
to annul rates which might be con-
hscatory in view of the present high
cost OF operating.
The director general also expressed
the opinion that railroads operating
privately could maintain joint ticket
ohices without violating antitrust
laws.
Senator Kellogg Of Minnesota chal-
lenged this conclusion.
Don't you know" the senator in
quired. that when a committee Of
railroad presidents tried to unity the
roads before the government took
hold, that the attorney general in
quired by what authority they were
acting and intimated that they were
violating the law?"
do you believe in the elimination
Of all competition between railroads /?
Don't you think that the competition
OF service has been a principal factor
in promoting good railway service ~
Mr.. McAdoo replied:
Il don't know yet whether it would
be best to eliminate all competition.
That is why I want five year test
period. LIDO not think competition is
an unalloyed blessing, but . longer
trial will show how much Of it may
be necessary" .
Turning to the question of a threat
ened breakdown in morale among Of
hcers and employees, which he feared
II government control should be linn
tied to 21 months, the director gen
eral said:
TT would be difficult with the inn
pending presidential campaign to
keep the railroad question out Of poll
tics. If the railroads are held onl:, 21
months, ] fear the employees them
selves would become objects of solici7
tation for one plan of campaign or
one group of candidates. The railroads
of the United States must be kept out
of politics"
Senator Kellogg asked:
Mr.. McAdoo, you have stated that
it should be possible to reduce rates
this year. AS a matter of fact was not
the railroad administration plans on
foot for raising rates?'
mo" replied Mr.. McAdoo. 1--WE
have under consideration a plan for
equalization Of rates which may have
the incidental effect of raising charg.
| n
He referred to the proposed plan
for @standardizing class rail rates, both
intra and Interstate.
Senator Kellogg then turned to the
matter of the supply of rolling stock
added during the year, showing tina,
although the railroads need about
100000 new cars year only $4,000
We're delivered. and that although A..
900 new locomotives are needed an
nually only 542 were delivered.
The director general replied that
although numerically the car supply
had decreased, more effective opera.
ton has really enlarged the supply
There is no serious complaint now
as to lack of freight cars" he said
"or to the prompt movement OF
freight, although on account of troor
movements there is some shortage o1
passenger equipment"
Senator Kellogg inquired why il
spite Of increased revenues the pro.
portion of expenditures to receipt.
had jumped from 50 per cent in the
first ten months of 1917 to 80 per CEN
in that period Of 1918.
Il do not think" Mr.. McAdoo said
that you should Judge unified contro
by earnings. Expenses were higher be-
cause of the necessity. We had t.
materials for the whole year although
higher rates were in effect only si1
months"
have religiously kept politics ou
Of my administration. do not know
the politics of my assistants or m,
regional directors. I selected then
because of their ability to run the
railroads.
Mr.. McAdoo said that with fv,
year period railroads could operate a
least three years without prospect o,
change and by that time congress
should be able to develop a perma
1lent. solution.
Senator Kellogg sought by question
ing to show that the railroads operat
ing privately but with unified contro
under some sort of government super
vision could effect most of tn,
economies and reforms advocated b,
Mr.. McAdoo, The senator referre;
particularly to embargoes which tn,
director general maintained should b,
imposed as emergency measures
through exercise of the permit sys
tenn whatever form Of control Il
adopted. Mr.. McAdoo suggested tina
to prevent abuse Of the embarE,
power rjrailroads should not be allowe,
to act alone and arbitrarily, but pos
sibly with the supervision Of tn,
interstate commerce commission.
JAP TROOPS 10 BE wTTHDRAwN
London. Jan. 4.--Announcemen
that $4,000 Japanese troops will b
Withdrawn from Siberia, It u reporta,
by . Toxic dispatch to the Exprs.