The Democratic banner. (Mt. Vernon, Ohio) 1898-192?, 1920-04-06


Thompson. Frank w. Taussig, Henry
j.. Waters, George w. Wickersham.
former Attorney General and owen
d. Young.
Rehabilitating The Railroads
+, Now that the railroads must be run
as "going concerns" and find way
to finance their own operations before
September /, the public interest ma.
turally is concerned in the question
as to how much II will be Obliged to
pay in increased passenger and
freight charges to meet the new con-
ditions. At the joint conference of
managers and men held in Washing.
ton the railroad wage demands made
onNbehalf of 1,S5O.0OO employees on all
railroads reached the unprecedented
total of 81 ,1O0.0OO,O0O. The confer
ence opened on the same day thnt
the Interstate Commerce Commission
began hearings to determine what ad-
vances in freight rates will be neces.
sary to provide the $l,000,000,0O0 of
advance in wages already granted
during the two years of Government
operation of the railroads.
Under the new railroad legislation
the Interstate Commerce Commission
is directed to make railroad rates
that will yield Il minimum of 5H per
cent on the aggregate value of the
railroads. The great advance in the
cost of operation. chiefly for wages,
during the 26 months of Government
control, has reduced the railroad net
income to about 2A per cent, or half
the minimum under the new law.
Railroad traffic experts estimate
that, to provide revenues sufficient to
take care Of the billion dollar wage
advances already granted, an in
crease In freight rates of approx
mately 25 per cent will be required.
The extent of this increase will be for
the Commerce Commission to deter
mine after hearings that are expected
to extend well into the summer. The
decision must be made before Septem-
f! ber when the Government guarantee
of pre-war earnings expires.
II the new wage conference results
in further increase in the railroad
payroll then, under the Transports.
tion Act. the Commission will again
be Obliged to raise freight or passen-
tger rates, or both, to provide the adj,
ditional revenues to pay the wages.
Tho granting OF the new billion dol
lar wage demands would, under the
law, mean u further:2b per cent ad.
vance in freight rates on topTof the
25 per cent advance about to be con.
sidered by the Commerce Commits.
sion.
| When the railroads were turned
back to their owners on March /, the
managements were facet with an an
nual payroll of $2.77050O,OOO as COM
pared with $l,74O, 100000 under pri.
vate operation prior to Government
control.
Production Costs ard living Costs
In the last eight mon rs of Govern.
ment railroad operation new wage
demands kept on accommodating While
tho leaders OF some of the more con.
servative unions. Iiulcnly Warren s.
Stone of the locomotive engineers, l..
II. Sheppard OF the conductors and
w. q. Lee of the trainmen, believed
that fuilhcr large wage increases
would only increase production costs
and living costs. and urged as walt
Ing policy, the radlcal labor leaders,
especially in the shop crafts, were in.
siAtent on further wage advances.
The result was that the conserva.
tives, for self-protection, had to fol.
low along with the radicals. and make
proportionate demands All of these
demands, covering 1,S50,0OO OF the L..
100000 employees, have now been turn.
ed over to the railroad companies
That tho billion dollar wage de-
mands will eventually come before
the new Labor Board, on which the
| public is represented, is considered n
certainty. It is not believed here that
u conference committee made up on.
ly of employers and employees would
have the courage to agree to increase
the railroad payroll by any large
amount, on the supposition that the
Interstate Commerce Commission
would under the law be at once oblig.
cd to pass the cost on TO the public
through increase In rates. II is point.
cd out that the very evident purpose
of Congress-, In framing the Trans
portation Act, was to put both rail,
road rates and railroad wages under
public control. While the manage.
ments and the men will have six
votes to the public's three on the new
Labor Board, the law provides tha;
no wage award can be madS Ia tbs
! HDard which dnna mt ha.n tho vntf