New Mexico state record. (Santa Fe, N.M.) 1914-19??, 1920-07-23
KEEP WATCH ON
THE RAILROADS
COMMERCE COMMISSION WILL
BRING CARRIERS UNDER NEW
REGULATIONS.
FORESTS REDUCED ONE. HALF
Supply Shows Shrinka0e Which De-
mands stoppase Of Devastation. Ae-
eordino to Secretary Of Agriculture
Washington the City Beautiful.

eordine to Secretary Of Agriculture
Washington the City Beautiful.
BY JAMES P. HoRNApAY.
Misunderstanding under author
ity conferred on 1t by the new trans-
portation law with respect TO the con-
structiOn of new railroads, extensions
OF existing law with respect TO the
construction Of new railroads. extern
siOns Of existing lines and the aban-
donment Of existing lines, the inter-
state commerce commission has pro-
mulgated regulations prescribing the
method Of procedure for carriers. who
must get permission from the federal
regulating tribunal before taking any
action along the lines Indicated.
Invoking its power under the com
merce clause of the federal Constitu-
tion. congress, after years Of aglta-
ton designed to bring about such a
result, wrote into the 1920 railroad
act provisions placing In the hands Of
the interstate commerce commission
complete control Over the future de-
velOpment OF Americas commOn car
riers by rail. II Is now for the cOm-
mission to say whether or not a new
rOad should be constructed, whether or
not extensions should be made and
whether or not lines which are no
longer profitable may be "junked."
In the history Of the railroads and
railroad legislation there are many
pages referring to that w~ell-known
phrase. "watered stock" Many
speeches have been made in congress
and before congressional committees
as to the iniquities Of past railroad
financing. The outcome OF all this
vas the enactment of that part Of the
e law which the commission Is now
preparing to enforce.
Considerable opposition to the pro-
visions under discussion developed In
congress while the railroad bill was
being debated. Some senators and
representatives believed that passage
Of the bill as drafted would mea the
doom OF the development Of American
railroads. They believed that II any
person or corporation should desire to
build a railroad or tear up an old
one. they should have the right to do
so without getting permission from a
governmental agency in Washington.
OF course the provisions relate only
10 railroads which are a part Of inter-
state commerce. The authority OF
the commission does not extend TO
lines wholly within the boundaries OF
the state and not connected with In
terstate carriers.
Must De Approved.
Closely related to the provisions gov
ernlng new construction and abandon
ment Of railroads are those requiring
carriers to get permission from the
commission to issue securities In
both instances the carrier applicant
must prove to the satisfaction Of the
that II Is In the interest OF
public necessity that the application
for permission to issue securities DR.
to build a new line Of road should be
approved.
Under the terms OF the new law
the day has passed, therefore, when
great leaders in the railroad world can
engage In competitive combat by build
ing lines OF road solely for the pur-
pose OF taking business away from the
other. In such nm instance 10Y the
would in all probability
say the existing line OF road is sufi-
Gent for the public needs and the CON-
peting line would not he built. Pro-
who engineered the financing
Of railroad projects simply for the
money that could be obtained there
from by the sale Of stock TO small in
and o because the particular
project In hand was OF public neces-
sity, also have their means OF fiveli-
hood taken from them under the new
law.
Must oivuipe Finances.
The prospective builder Of a railroad
hereafter must be able to show the
commission also Just how he will
finance the project and submit esti-
mates as TO the volume OF trafic that
would move on the road after II had
been built. Complete maps Of the
proposed project also must be filed.
Applications for permission to aban-
don existing lines of road must give a
complete history Of the road. show the
names Of all the cities, towns and VII
lagos located upon the line, and II the
abandonment is desired because Of un-
profitable operation. II must be shown
whether the Improbable operation is
due to an insufficient volume Of trafic.
to unremunerative rates and charges
or divisions Of rates, to lack of ade-
auate facilities and equipment or to
other circumstances.
Under the provisions under discus
sion a company constructing q new line
Of road may get permission from the
commission to retain for a period moi
exceeding ten years all or any part
pf Its earnings In excess OF an amount
Equal to G per cent on the value OF its
property, plus one-half over 8 per
rent. Other roads must turn over to
The government 50 per cen Of earn
over 6 per cent. Exemption Of
lew lines of road from this provision
Is to excess earnings was written into
he law with q view to encouraging
lew construction where necessary.
LET THE OTHERS De CAREFUL