New-York tribune., 1919-01-16
Hines to Ask
Half a Billion
More Cor Roads
Government f.oans Ncces-
sary Even if Turned Back,
Rnil Director Declares
Expenditures Increased
Cost of Betterments and EX-
tensions Doubled; I'm 2
Years Is SI,627,OOO,O 900

WASHINGTON, Jan. 15.-Another
appropriation OF $4,000 ,OG0 or more
will be asked of Congress soon by Di-
rector General Hines for the railroad
administration revolving fund, to be
1sed mainly in extending loans to rail
roads to cover the extensive programme
Of improvements and extensions, for
which more than billion dollars prob
ably will be spent this year.
Most of the half billion dollars origi-
nally appropriated Tor the revolving
fund was spent in financing improve
ments or purchase of equipment last
year. Loans generally are to be made
at per cent and will be repaid to the
government.
Mr.. Hines, in statement to-day,
said tho railroad administrations func-
tion OF financing necessary improve
ments, as differentiated from the func-
roads, "is the reason which will re-
quire an early request for a large ap-
propriation."
$1,627 200, 900 for Two Years
He explained that capital expendi-
lures of railroads in 1913 and 1919 for
extension of lines, new buildings,
bridges, cars, locomotives and similar
purposes, are calculated at about ST.
627,00o,000, including S350,OO0,OoO esti-
mated as necessary in 1919, and s1,277,-
100000 authorized for 1918.
OF the authorized capital expendi-
ture budgets last year only 1888 ,0OO,-
600 was actually used, and $6S9,00O 600
remained to be spent in 1919. This
means that the railroad administra-
tion's programme for railroad extern
sions and betterments in 1919 calls for
outlay of $1,0S9, 100000, or three times
as much as was spent by all railroads
annually for several years before the
war.
In view of the approaching fifth
Liberty Loan campaign, officials be-
lieve railroads would have consider
able difficulty floating privately sufi-
cient securities to pay for improve
ments which the roads and the rail
road administration consider advisable
to bring the lines up to a high state
of efficiency.
Still Need Government Aid
For this reason, Director General
HInac a1
policy of government assistance, re-
gardless of whether Congress extends
the period of Federal control.
Referring to the contemplated
capital expenditures for 1919, Mr..
Hines said:
"Whilc substantial part of this
total may not actually be expended
during the calendar year 1919, it is
apparent that it will be necessary dur
ing the year for the government and
the railroad companies to provide in
the aggregate a very large amount of
money for these Improvement pur-
poses.
"a careful analysis of the situation
Is on the point of being completed, with
view to preparing an estimate for
Congress for the necessary appropria-
ton to meet this situation. While it
Is impossible at present to make an
exact estimate of how large an addi-
tlonal appropriation will be needed. it
IS possible that it may exceed $780,
600 900"
When Mr.. McAdoo appeared before
the Senate Committee on Interstate
Commerce few days ago to appeal for
an extension OF government operation
OF the railroads to five years after the
declaration of peace he stated that the
governments operating deficit for 1913
was Sl36,0o0,O00. Since then the rail-
road administration has raised this es-
innate TO 100000, 600, and it is now he
heved that the deficit will be we'll above
$500, 100000
Why McAdoo Suggested Action
Critics of the railroad administra-
tion suggest that one of the reasons
why Mr.. McAdoo was so insistent on
an immediate return of the railroads
10 their owners if Congress would NOT
grant the tlye-year experimental te1t
may have been his doubt as to the
aoiiity of the administration to re-
cover the large operating deficit in
1919 earnings, and his reluctance to 90
peiore Congress to ask for another
s5000o00oo to replenish the exhausted siiel
revolving funds.
Figures just made public By the IN
terState Commerce Commission show
tnat Tor the first eleven months of
1913, with an increase Of only ~ per
cent in freight traffic over the same
period IN 1917, the expenses of govern
menr operation have increased billion
dollars and the net operating income
shows loss of 1858 .000. 600.
II u further suggested by critics that
Mr.. hcAdoo may have been reluctant
TO face further increase of wages.
Although the railroad payroll under
government operation has already been
increased by s700,o00 900, or 40 per
cent, the bulk Of the wage advances 3