The Fallon standard. (Fallon, Nev.) 1920-1958, 1920-08-19
Freight Increases
And Family Purse
VIII Have No Appreciable Effect On
Prices of Ordinary
Commodities

(By Frank IL. Fayant, Assistant to
the Chairman, Association of Rail
way Executiyes.)
II the cost of living is raised
more than 2 per cent by the ST.
200,O00,000 increase in freight
charges, 1t will be plain evidence
that middlemen and retailers are
taking an unfair advantage of the
public An increase of two per
cent in average prices would be the
II there were no change in other
forces acting on the price level.
But the general tendency of prices
Is now downward. We have passed
the peak of war imitation. 1t is
reasonable to believe, therefore,
that prices will fall rather than
feet
The fact is that In the produc-
ton of most articles of common
daily consumption, the transport
charge is so small that an increase
in rates has no appreciable effect In
the family budget. In bulky ar
transportation is very large part
of the process of production and
distribution, an increase in freight
rates necessarily means higher
prices. But even these compare
lively large increases in particular
commodities may be absorbed as a
result OF other forces working for
lower prices.
The increase In passenger rates,
while producing a very much small
er amount of additional revenue
than the new freight rates, will
strike more directly at the average
mans pocketbook. But the new
passenger rates will raise travel ex-
penses less than So per capita a
year, or less than one cent day.
Suburban residents, who travel
thousands OF miles year for the
pleasure of living in the country
while working in the city, will pay
much more than this average.
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 go
into the treasures of the railroads
nor into the pockets of the owners.
Practically all of this additional
revenue will go directly to the two
million 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 Chi
cago gave 10 the railroad employees
an. additional s625, 10000 a year
or am average of more than 5000
to each employe. During the two
years of government operation OF
railroads, because of the increase in
the cost OF living. the railroad ad-
ministration raised wages by more
than $1,000. 100000 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, 100000 year,
or considerably more than the new
freight and passenger rates will
produce.
The increases in rates made by
the government In 1918, which pro-
duced about 5000, 600. 600 addition
al revenue. were practically all abb
sorbed by the increased prices for
fuel and materials consumed in
railroad operation. AS very large
part of the increased cost of coal
aud materials purchased by the
railroads has been due to the more
than 100 per cent rise in wages paid
workers in these other industries, II
Is plain that the great bulk of the
$4,000. 100000 increase 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 l29
per cent. The railroad payroll to-
day Is on the basis of $4,000 .000,-
900 a year or $4,000, 1000, 900 more
than II would be IL the employees
were being paid at the pre-war
rates.
These plain facts show that the
railroad owners do not receive ST.
500,O00.000 or any appreciable part
of IT, For some time to come there