New-York tribune., 1920-02-26

at the mercy of the commission. 1t
need not seek to destroy, 1t need only
make few bad guesses, to insure
bankruptcy.
Judge Prouty spoke of the public's
uncertainty. The commission, under
change the valuation, the percentage
which shall be considered fair re-
turn, and the rates themselves. None
of these things need be any more stable
/ than the commission wishes. 1t will
be the commissioner, rather than the
roads themselves, in which investors
will have to have faith.
Can Give Succor in Emergency
Further. the commission has con-
siderable power to help the roads sur
$300,000000 provided from which it
can make loans to the roads imme-
diately. The contingent fund, to be
built up from the excess earnings of
the strong railroads that are sure to
follow an increase in rates, will also
be under the commissions control.
From this fund it can make loans. 1t
| can, too, buy equipment itself, and
rent it to the carriers.
All this means nothing in the way
OF guaranty to any individual road,
to issue direct orders that may cost a
road millions 1t has no power to
help beyond lending the road money
at such rates of interest as it deems
mt, and on such security as it chooses.
Beyond that it cannot go The excess
earnings in the contingent fund do not
go to the weak roads except as loans,
which must be repaid with full interest.
The new policy does not even guaran-
tee anything to the roads as a whole,
except as the commissions acts back it
up. 1t simply means that the commits
sion has power to make the railroads
as whole prosperous, and is expected
to do so.
To justify the new policy of support
the commission is gYven many new
and drastic powers over the roads.
Almost no function remains outside its
control; on the most important ones
the roads cannot move without it's per-
mission.
| 1t is now permitted to establish mini
mum as we'll as maximum rates, to end
all rate wars. 1t can force road to
build certain extensions, and has power
to decide whether new trackage shall
be built, or old trackage abandoned. 1t
can force road to increase it's equip
ment of any kind. and it is specifically
given the authority to order the roads
to install automatic train-control or
train-stop safety dcvices-an improve
ment that would cost hundreds of mil
! lions.
Finance Control Absolute.
Its control over railroad finances ;s
complete. No securities can be issued
without its approval, though this does
not insure buyers of such securities
against loss if the commission should
make mistake. 1t will pass on the
financial arrangements of any consoli-
dations that take place. 1t will deter
mine how much can be spent from in
come as fair amount for the upkeep
OF the property. It already has the
power to prescribe the system of ac-
Its control over traffic is greatly ex-
tended. Several new powers are given
1t with the intent to preserve improve
ments which have been worked out
under Federal control. 1t can force
the joint use of terminas-there have
been more than 600 such arrangements
made during the government control
period, many Of them between com
peting lines. 1t can decide how much
the non owning road is to pay the
owner of the terminals. 1t can con-
troll freight pools. it can direct the
routing of all traffic which the ship
per himself does not direct-a power
that can easily destroy roads by turn
ing large parts of their best paying
business to other lines. 1t can order
the diversion of equipment from one
lire to another when it sees fit
But greater powers are in reserve.
The commission can declare, at its dis
cretion. when an emergency exists.
After that it has practically all the
powers that the government has had
over traffic under the Federal control
act. The roads Will be able to do very
little more than to carry out the COM
Mi sion's orders.
These are the legal powers. They are
not quite complete; railroads are left
with very considerable amount Of
discretion and initiative. But there
is another power, not mentioned in the
act but written between the lines
that of advice. With its tremendous
actual power the commission will be
able, if it wishes, 70 give counsel in
such a tone that a wise railroad will
listen with profound respect Such
advice would be extralcgal, but it has
been given before in America both in
business and politics, and the commits
sion is somewhat in business and poll
tics. Such advice might be either
good or bad-the point is that the
power to give it rounds out the com
missions other powers, and completes
| it's domination of the railroads.
Can Dictate All Rail Mergers
These powers of the commission al
ready assure the abandonment of