The gazette-times. [volume] (Heppner, Or.) 1912-1925, 1920-08-26
Railroad Rate Increases and
the Family Purse

81. FRANK d. FAYANT Assistant DO.
r.a Chairman. Association Of Rail
say Executives
IItaa cost 0t living is raised more
than . per cent by the S1.-9t.00O,-
600 aeraa-a 90 the freight charges.
IL VIII be pla.u evidence that middle
uan ana retailers are taking an un-
fsir advantage OF the public. An in
crease Of e per cent in average prices
would De the maximum cost Of the
rate advance if there were ne change
lu other forces acting on the price
level But tie general tendency Of
prices is now downward. We have
passed tie peak of wax initiation. 1t
IS reasonable TO believe. therefore,
that prices will fall rather than rise
after tie new rates are in effect.
Tile fact is that in the production
oI most articles Of common daily con-
sumption. the transport charge is so
small that an increase in rates has
no ~appreeiable effect IN the family
budget. tn bulky articles like coal,
OF course. where transportation is a
very large part OF the process Of pro-
ductiou and distribution, an increase
in freight rates necessarily means
higher prices. But even these com-
paratiyely large increases in p~articu-
lar commodities may be absorbed as
a result Of other forces working for
lower prices.
The increase in passenger rates,
while producing a very much smaller
amount Of additional reyenue than
the new freight rates, will strike
more directly at the average mans
porketbook. But the new passenger
rates viii raise travel expenses less
than IS per capita a year, or less
than one cent a day. Suburban res
dents, who travel thousands Of miles
a year for the pleasure of living in
the country while working in the city,
will pay much more than this aver
age.
The $500, 100000 of additional
freight and passenger revenue to be
paid by the public for railroad ser
vice under the new rates will not so
into the treasures of the railroads
nor into the pockets of the owners.
Practically all Of this additional rev
enue will go directly to the two mill
ion railroad workers whose wages
have been established on a new level
after the most careful consideration
Of all the facts by a government wage
board.
The recent wage award in Chicago
gave to the railroad employees an ad-
ditional Sos, 000,0 900 a year OF an av-
erage of more than $500 to each en-
ploye. During the two years Of gov
eminent operation of railroads, be-
cause Of the increase in the cost Of
living, the Railroad Administration
raised wages by more than $1,000
600, 900 a year. The total increase
in wages, therefore, since May, 1918.
when the Lane Wage Board made its
first award. is more than $1,000, 000,-
eco a year, or considerably more
than the new freight and passenger
rates will produce.
The increase in rates made by the
Government in 1918, which produced
about $500, 0O0, 900 additional reven-
ne, were practically all absorbed by
the increased prices for fuel and ma
terials consumed in railroad opera
ton. As a very large part of the in
creased cost Of coal and materials
purchased by the railroads has been
due to the more than 100 per cent
rise in wages paid workers in these
other industries, it is plain that the
great bulk Of the S2,400, GOO, 900 in
GREASE in railroad rates in the past
three years goes to the wage earners.
Under the new scale OF railroad
wages, the average annual earnings
per employe will be $1,000, as COM
pared with $3.50 at the beginning of
the war. This is an increase of 129
per cent. The railroad payroll today