Evening star., 1920-05-21

Minimum Need of Lines Placed at
1000 Locomotives and 100,
600 Freight Cars.
The railroad system of the United
States. suffering a stroke of freight
paralysis. was put on the way to re-
covery today by series of curative
doses, administered in quick success
sion by the government.
The remedies applied are:
Approval by the Interstate Com
merce Commission of plans for the
railroads use of $125,00o,0o0 out of
the $300.000.0 revolving fund pro-
vided for in the transportation act,
for the purchase of new equipment.
Orders for the immediate breaking
up of the freight jam by routing cars
over most available roads and trans
ferring thousands of empty cars from
the east to the west and from the west
to the east.
A loan of at least s125 1000. 900 is to
enable the railroads to purchase i'm
mediately equipment needed to meet
the transportation needs of the public.
Revolving Fund Provided.
In the transportation act. For the
purposes of immediate administration
the Association of Railway Execu-
tves, which has been studying it's
apportionment, recommended the tenn
porary division as follows: Temporary
reserve for claims and adjustments.
s4O,O0o.0e0; apportionment for short
line railroads, $12.000,000: temporary
reserve for maturities, 50,000. 900; ap-
nT0nriafinn fn aid in he rictfi
of equipment, $125, ,000,0 900, and appro-
2riation for additions and better
ments, which will promote the move
nent of cars. $73.0oo.oo0.
Minimum needs of the railroads are
placed at 1000 locomotives and 100, ,000
freight cars. including 10000 refrig-
orator cars. Some of this equipment
already is under construction. or has
been ordered, the commission stated
But $125, 100000 probably is less than
25 per cent of the cost of the re-
mainder, it is estimated.
Burden Must He Assumed.
It is evident, the commission be-
neves. that the equipment required
properly to meet thetrnusport4tion
needs Of the public" cannot be secured
unless the carriers. with the aid of
the IS per cent to BE advanced by the
government, themselves assume the
burden Of financing the remaining Is
per cent.
Since the distribution Of the revolv-
ing fund by cooperative action with
the commissioner said. ALLEGATION Of
the $I25.000.000 for equipment would
be made according to the percentage
which the standard return of . COM
pany bears to the total standard re-
turn of all the railroads. In referring
to the OPPOSITION to this plan by the
National Association Of Owners of
Railroad Securities. the commission
remarked that Few applicants. seem
To appreciate the necessity that the
carriers assume a part Of the burden
and 30 use the amounts adanced by
the government, as the basis of car
trusts as to obtain ."the greatest
benefit from federal aid"
Hearing Here May ..
Hearings to consider applications
for loans will be held here May %.
and the commission asked that appli-
cations embody in detail statements
OF the transportation needs which the
carrier would be unable to meet, and
what service for the public could not
be performed if the loan asked was
not granted: statements OF what Sc
curity is offered. and the respective
IF the loan is desired for other addi-
tons and betterments. the commission
said. lit should be clearly stated where
in the expenditures proposed will ex-
transportation needs Of the country i"
Equipment Corporation Planned.
The $125.00o,000 for equipment
might best be disbursed," the state
ment said. through a national equip
ment corporation in which the car
riers would take stock for 25 per cent
of the cost of the equipment, the
United States advancing the cash for
the stock up to S125.00O, 600 and the
remaining rs per cent being financed
through car trust. Provision would
have to be made for adequate per
diem or rental with such an arrange
ment.
In the event this equipment COR
poration cannot be organised. then the
fund should be disbursed to those car
riers who individually can meet the
governments advances with large
proportional amounts financed by
themselves.
Loans should not be granted for
additions and betterments, unless it
be clearly demonstrated that these i'm
provements will facilitate materially
the movement of equipment"
Consider Means Of Distribution.
The two subjects which the COM
mission declared would have to he
considered at the hearing were: The
means by which the fund of $500. .O00.-
600 should be distributed in order to
tcSt chooic tHS properly to
meet the transportation needs of the
public: the means by which the fund
should be distributed in order to best
insure that the earning power of the
recipients and if the character and
value of the securities offered are such
as to furnish reasonable assurance
of the applicants ability to repay the
loans within the time fixed and to
meet their other obligations while re-
slizing the purpose of properly sery-
ing the public.
Three Sweeping Orders.
The commissions approval today of
plans for use of part of the revolving
fund to aid the railroads in bolste ring
their finances and buying new equip
ment was prefaced last night by the
issuance of three sweeping orders.
These orders disregard the private
ownership of transportation lines and
hit directly at the root of freight
congestion. They combine the roads
of the United States in one big unit.
Its object is to move freight directly.
quickly, and to rush thousands Of
empty cars where most needed.
The orders, briefly summarized di-
rect the following:
All shipments of freight en- route
to be sent over the most direct and
least congested line. regardless of
the individual preference Of the shin
per or consignee.
That western railroads supply to
, the east within twenty days.a total
of $500 empty open-top cars. The
purpose of these cars will be to pro-
vide equipment for moving coal from