Evening star., 1920-01-18
CONTINUED u. S. RAIL CONTROL
URGED BY ROBERT W. WOOLLEY
Says Roads Have Not Suffered Deficit
Under Federal Direction, But Have
Made More Money Than In Years.


might cause the people to rise up and
demand government ownership forth
with. II is due, of course. largely to
the elimination of waste in handling
cars.
To-day a car is at home. no matter
where it is. and does not actually
have to move except in response to
traffic demands. But under private
control when a car had discharged it's
load 1T was started back to the home
line. OF course IL was loaded if pos
sible. but it went empty if there was
no freight TO put into it. Great Brit
ain saw the folly of this sort of thing
during the war. and by proper regu-
lation of the moving of cars of coal
alone eliminated 700, 900, 900 ton miles
per annum. on a total track mileage
of something like 26.000 miles. Con-
slider that our rail mileage is some
thing like 251.000 miles. and you can
see what eliminating waste haulaae
means.
Outlook for 4. s. Trade
THE United States has invested ap-
proximately $1,000. .000, 900 in a mer-
chant marine. The competitive mar
kets of the world lie fallow before
us. For short time it may be pos
sible for us to command practically
our own prices for many commodities.
But in a few years Europe will be on
her feet. Though today labor costs
tnefe nave Increased greatly, pay
ment is being made in money which
has deprecated far more than the
American dollar when submitted to
the acid test of international ex-
change. European production costs
are cheaper and will be cheaper than
ours. If we further increase produo-
tion costs SO that we cannot sell
against Europe in the competitive
markets of South America. Asia and
the orient, what is to become Of our
IS, 600. .000, 900 merchant marine? What
is to become of the United States pro
ductive capacity beyond that required
to fill our own needs? Before the Euro
pean war began the Secretary Of Com
merce said we required a foreign outlet
for three -eghths of all that we produced.
If production costs again soar, it does
not take Solomon to prophesy that
our merchant marine will either have to
be sold to some government which can
operate it at profit, or it may be tied
up in our harbors to rust and decay.
and our surplus producing capacity will
soon become scrap. What do those who
think they can see some temporary self
ish advantage to be secured by the
prompt return Of the roads to private
operation imagine would happen in this
country? Would there not be unrest in
all classes? Would it be confined to
labor alone?
COrrects an Impression.
Let me correct an impression as
to just what is occurring under fed
eral control. The so-called standard
return is the average net operating
income for the railroads taken over
by the government in the three fiscal
years ending June 30 1914 In two
of these years. this income was
around the billion dollar mark. but in
one of them-1915-it was s727 600 600
Only twice before in the history of
our railroads. in 1910 and 1918. has
the net operating income for one year
exceeded the $S00.000.O00 mark. In
1918, under federal control. the op-
Grating income was $72S.000. .000-a
million more than in 1915. the first of
the three years used in the standard
return. and $23,OO0.00 more than it
was in 1914. With the exception of
six years prior to 1916, it was higher
under federal control in 1918 than
1t ever had been in the history Of our
railroads. Yet one reads of operat-
ing deficits There is no deficit. With
the prices of materials soaring and
necessitatinS an expenditure for
maintenance of $1,741,4S3.S95. or S777.-
24I093, more than the average an
nual expenditure for maintenance OF
the same properties in the test period
under private control-for the first
ten months of 1919 the governments
expenditures for maintenance exceeded
those OF the test period average by
IoV.4 per cent-with a wage increase
covering twelve months and a 25 per
cent rate increase covering six
months, the government simnIv ia lied
to earn in 1918 within something
over $200.000,000 of generously guar
anteed rental, based on the returns
Tor one normal year and two miracle
years.
Reckless Statements Cited.
Ihese are facts, the Importance of
winch cannot be overemphasized i'm
iight OF the charge SO recklessly and
Ireey made by the railroad execu-
tlves that the carriers are headed for
oankruptcy under federal control. In
!soe, the net operating income was
sllo,Oeo,00O less than it was in 1907.
IN 1914, it was $125.O0O, 600 less than
IN 1913, and this under private con-
ciol' NOBODY heard of operating def
cits in those days. Inasmuch as these
shrinkages happened under privats
control. they were due to economic
reasons and not to mismanagement
>, nat Kind of economic conditions
old we have in 1918 and the first six
montns OF 1913? Railroad labor re-
ceIved smaller average Increases nv
nearly SO per cent than the labor or
the united States Steel Corporation.
Tor instance, received in the same
perlod. but an enormous increase by
private industry was good busi-
d
py the director general was a sur
render to labor. Why doesn't the
man who wishes to discuss intel
ligently this subject of la Dor increases
read the testimony of President Hea
of the Pennsylvania and PresiIent
Underwood of the Erie before .be
interstate Commerce Commission i'm
the Is per cent case in October and
November, 1917, and learn what they
said the railroads would have to paw
order to retain labor. and how many
rate increases might be necessary.
Also, how skilled labor was not strik
ing. hut leaving the railroads for un-
skilled employment at greatly in
creased wages in the steel plants. the
munitions plants and the shipyards.
why doesn't he read Mr.. Rea's de-
scription of the rapidly growing
shortage of man power on the east
ern roads and the necessity of using
three men where formerly two would
do?
Situations Are Compared
With commodity traffic shrinking
almost to the vanishing point after
the signing of the armistice Novem
Der II. again it takes no Solomon to
prophesy that if the railroads had
been under private control the shock
absorbing capacity of the federal re-
serve act might have been tested to
the bursting point to tide US over re-
sulting financial disturbances caused
by wholesale receiverships of the
railroads.
''In order that the frightfuI expert
ence of the winter of 1917 and 1918
might not be repeated. the fuel ad-
ministration encouraged the piling
up of great coal reserves in most of
our important centers; the moment
the armistice was signed those who
had bought these enormous stocks of
coal at high prices decided to use