Evening star., 1920-02-07
AGREEMENT OF CONFEREES
PLEASING TO RAIL INVESTORS
Rate Making, improvements, Earning
Guarantee and Anti-Strike Provisions.
Drop in Foreign Exchange Discussed.

Investors in railroad securities have
been much encouraged this week over
the reported agreement of the Sen.
ate and House conferees on the bill
for the return of the railroads to
their owners The compromises reach
ed by the conferees will please some
of the railroads, and displease others,
it is said. On the whole, however:
there has been much relief expressed
over the progress made. For a time
it was feared that the two houses
would be so hopelessly deadlock ed
that legislation would be Impossible
by March I, the date set by the Presl-
dent for the return Of the roads from
government operation to their owners;
The rate-making section OF the Dill
is that of the Senate with some modi :
fications. In the first place. a return
Of 81. per cent upon the net railway
operating income is guaranteed lot
a period of two years. The Senate bill
made the guaranty period five years.
Provision for improvements.
In the compromise provision is made,
too. that with the approval OF the In
half of one per cent of the earnings
may be given to the railroad respon-
sible for the earnings to be used Tor
such unproductive improvements as
the erection of terminals or the eliml-
nation of grade crossings.
excess of the 6 per cent will go to
the railroads producing the excess.
while the other half goes to a rail-
road contingent fund, to be admin
istered by the commission and used
for the purchase of rolling stock and
other equipment to be rented to the
weaker roads. Loans from this fund
also may be made to the weaker
roads.
The Cummins bill provided still
greater aid for the weaker roads
from the surplus earnings of the
strongly opposed by some of the rail-
road executives. among them Judge
Lovett of the Southern Pacific. Even
now this provision in the bill will
meet with much criticism
1. c. c. May Change Rates.
The conferees haev agreed that the
Interstate Commerce Commission may
six months after the roads are re-
turned to their owners. This: 1t is
expected. will prevent much litiga-
tion in the states over rates.
1t is believed on all sides that the
operation of the bill, which guaran-
tees to the roads 5la per cent on their
net earnings for a year and a half
or two years, will result in an in
crease in rates for freight. The In
terState Commerce Commission is CIV
en- authority to prescribe such rates
as will, in it's opinion. yield such re-
turns. After the guaranty period has
expired the commission is authorized
to agree upon the proper percentage
of return. and to fix rates accord,
ingly. This last provision also Will
not appeal to the railroads.
The Senate conferees yielded on the
anti-strike provisions. allowing the
Senate clause penalizing railroad EN-
ployes or employers for entering into
conspir acies for the purpose OF inter-
fering with interstate commerce 70
go out In it's place was SUBSTITUTED
a provision for the settlement OF laoor
disputes by boards composed equally
of employees and employers. The nnd, J,
ines Of these boards must be approved
by a federal board appointed by the
President with the Senate's approval l.
The decisions of the boards Will not
be compulsory. But there VIII oe CON
pulsion to submit an appeal. IN tne
event of a disagreement, to the fed-
eral board. The force Of public opln.
ion will be relied upon to see 10 IL
that the decisions Of the board are
abided by.
Drop In Foreign Exchanse'
The further drop in foreign ex-
change and the danger threatened 10
the Commerce of this country there
hy caused further discussion among
members Of Congress during the last
few days in regard to the ma.teI.
But nothing has been done In iact;
that nothing can be done to relieve
the situation in the United States but
that there must be greater production
m the mart Of the European nations
to overcome the unequal balance.
Senator Thomas Of Colorado. no"