The Wheeling intelligencer. [volume] (Wheeling, W. Va.) 1903-1961, 1920-05-12
with less train mileage might account
for one-half OF this reduction.
Sorn0 More Figures.

3ofno MORO 1l8uFes.
Taking the adjusted figures for the
year ended December 81, 1918. the Re-
suits shown indicate that under the
changed conditions the operating ratio
resulting from the identical business
would be 9l.5S per cent. To reduce this
to IS per cent ratio. with the same
volume Of business. would require an
addition TO revenues OF sopc S51t,OUn-
O0e.
THE average ratio OF operating ex|
penses to. operating revenues OF THESE
carriers fer the nine years previous 10
and including 1916 was T0.4 per cent,
and It would seem that rates ought now
Ito be 80 adjusted that the same stand
ard OF operating efficiency that obtain
ed during that period would now pro-
duce approximately the same operating
ratio. It Is also noted that the oper-
, attng ratio during the three-ycar per-
I iod averages SIS per cent.
The Transportation act provides Tor
q return Of SIS to s per cent, on the
value of the railroads. MT. Willard
states that the property investment OF
the Eastern carriers is is,a6s.6s8.ouo. on
which 6 per cent would amount to $685.
lei 900. But the earnings Of the year
ending October 81. 1919, with adjust
ments to present costs. show net IN
come of only slS.00s.o06. leaving a de-
Acit Of 35Il,113, geo to he made up.
! This amount equals 1913 per cent on
the ire'S He. Operating income.
The estimated aggregate annual net
| railway operating income" Mt. Will
ard stoted," is related to the aggregate
property investment account In The pc
lief that as an aggregate amount ms
ably the minimum as representing true
value. and further because 1t Is the
only estimate Of aggregate value prac-
tically available at this time Just s
4
available 10 Congress. when it pre-
scribed the percentages on aggregate
value that should be tai ZEN as fair
return for the two years beginning
March !. 1920. The Commission VIII,
OF course na m snai,s Js " "' 0'"e '>
The difficulties facing the carriers In
providing for their capital necessities,
at a time Of worldwide financial strain
were outlined by Mr.. willard as foi-
"The carriers must now rcassume the
burdens and risks OF Operation In a
period of uncertain conditions anectIns
business generally. The demands for
never more pressing than now. The cost
of new capital Is more than I percent
per annum even to those railroad COM
panies whose credit Is Of the best
The government Victory Loan bonds
are currently selling on basis OF re-
turn in excess of percent. New indus
trial issues. with which railroad fln1nc-.
Ing must compete. arc onerlns reSTns
to liberal commissioning for their sale and
distribution, and underlying bonds OF
substantial railroads may be bought on
a basis to yield : percent and IN some
Instances in excess Of. percent. EUR
Their, the European markets. hereto1nre
available for American railroad issues
are now closed and are In fact absorb"
ing our surplus funds. and this applSs
not only . Europe but TO practically
the whole world. including Japan and
In 1880 and 1921. from ;ebo, 900, oos-
To S2So,000, 900 per annum or maturing
obligations Of the Eastern carriers. now
bearing low rates of interest (sone as
low as 81 percenO, must be taken care
Of. and in such rehnancing the railroads
must secure funds on the basis or the
current cost Of capital
Little can be hoped for in the i'm
mediate future in the way OF lower OPP
Grating costs. There Is nothing in the
existing situation 10 Justify the expec.
pricss Will soon be lower. while the pub
lie expects. and justly 90. constantly
higher standard Of service:
"The carriers Will undoubtedly endea-
CIV, and substantial results may be ex::
pected in that direction. bur Increased
efficiency II largely dependent upon in
creased capital expenditures for i'm
proved facilities.
CLEARLY. unless increased revenues on
a liberal basis are meaxuraoly assured.
these carriers will not he able to meet
their maturing obligations or secure ad-
ditiopai capital on a basis such as the
public interest demands. nor will they
he able to render the transportation
service necessary for the growing coma
merce OF this country.
In connection with the request for in
creased rates, these flgures, taken from
official statements by carriers 10 the In
terstate Commerce Commission, are of
interest:
Property investment in American rail-
roads ......... llaNs,673.e6
Net Income (la1s. adjusted to present