Evening star., 1920-02-29
|COST Of OPERATION
lat MINIMUM UNDER
|U.S., SAYS DIRECTOR
Mr.. Hines Believes Private
Control Would Not Have
Shown Equal Economy.


was incurred by the United States
Railroad Administration during the
twenty-six months 1t operated the rail
lines of the United States, private
control and operation of these roads
would have been more expensive
procedure, according to the report Of
Director General Hines, submitted to
President Wilson and made public last
night.
Private control would have en-
countered mounting expenses during
the war and the period Immediately
following the armistice, in The same
form that the government did, says
the report, but it would not have been
able to effect as many economies as
ed administration.
Director Generals Views.
rhere is popular and misleading
eaten phrase to the effect that federal
control has cost anywhere from $780,
ooo'ooo to S1.s0o. 100000. according to
the bent and fervor of the person
making the statement" the director
general said. "As the result of my
continuous contact with this subject
ana repeated discussions concerning
IL with railroad operating people. NV
deliberate Judgment is that federal
cohtroi mas not cost cent more than
private control would have cost in the
same difficult period. but, on the con-
trary, mas cost considerably less.
oelieVe that the private control which
existed IN December, 1917, If IT had
continued during the increasing war
stress Of 1918. till the armistice and
~ oer'ns the even more difficult period
VI feconstruction since that time.
would have encountered in the asgre-
gate substantially as great increases
IN cost as the government has en-.
countered and would have been who'll
~ unable to realize many important
eIohomles which have, been accom-
pflshed through unification and which
nave helped to Offset partly the ae
sregate increases in cost
"'ublic Has to Pny.r
The easy allegation Of heavy loss Of
FEDERAL control. as DISTINGUISHED from
private control. has rested upon the
1aliaclous notion that there is no loss
unless You see it,. /. e., that there
would have been no loss to the public
a. ,ne public had paid rates high
enough to cover the cost, including
the rental. and that there is a loss to
the public to whatever extent tho
public has not paid high enough rates
10 pay such entire cost
The fact is that the cost, which Is
not be diminished through increasing
the rates. This cost may be paid in
tull by transportation rates which
are In substance a form OF special
taxation. or may be paid in part out
OF general taxation; but the public
should realize that 1t does not escape
paying the full cost merely because
the cost Is made less obtrusfye
through rates being high enough to
avoid a deficit to be made good
through general taxation. The public
has TO- pay the cost u. full in either
Mr.. Hines believes that the nation
and the railroads as well gained bene-
fits of lasting character from the
period of unified operations. In ad-
dition to betterments which he be-
Hines said the rail- lines were in a
position to better operate their prop
critics and to improve facilities. His
statement also dealt with the results
directly obtained through operating
the roads as a unit.
War and Peace Service.
1T made practicable a war trans
portation service which could not
said. Its unification practices have
increased the utilization Of the made
quate supply of equipment so that
exceptionally large transportation
service has been performed in the
busy periods of 1919 with a minimum
Of congestion: it met the unprecedent-
ed coal strike in way which private
control could not have done and alb
sorbed q heavy financial loss on that
account which would have proved
highly disturbing to private control:
1t provided more additions and bet
terments and equipment than private
control could have provided during
the difficult financial situation Of war
time; it dealt fairly with labor and
gave 1t the benefit Of improved work.
ing conditions which were clearly its
right; it not only did not cost more
than private control would have cost
during the same period. but cost con-
siderably less on account Of the econ
omies growing out of unifcattons. and
the total burden on the public
through rates and taxes-on account
Of railroad costs was substantially
less than would nave been necessary
II the railroads had remained In prl-
vate control and rates had been raised
enough to preserve credit; II protect
ed the investment in railroad prop
critics. whereas without federal con-
troll those investments would have
been endangered. and 1t turns back
| the roads to private control func-
exceptional performance in an ex-
ceptionally dificult winter, despite the
disruption caused by the coal strike.
and in . condition to function still
more effectively with normal i'm
provement to be expected In weather
and in other conditions"
Advantages Now offered.
The railroad corporations will start
their work with an important rsy-
cholog gical asset, Mr.. Hines said, point
ing out that the public holds to rigid
pSna sasyes any
the difficulties of the situation" He
declared the company officials re-
sumed direction Of their properties
| under "the most favorable possible
conditions Of public sentiment" They
he said. and put into effect permanent
organisations, things the railroad ad-
ministration could not do because OF
uncertainties of its tenure. and for
lack Of which the work has been
| conspiouously and progressively erl-
barrassing."
The railroad administration will
stlll have a definite work to do after
the roads are returned. In addition
to providing transportation service, 1t
has been charged with administration
Of contractual relations between the
government and the roads. Mr.. Hines
daeu gated TO pay 7.oco.ooo annual ~S rent. rent
al to the corporate owners. This. and
the other fiscal relations. which in
volved the purchase Of great guam
titles of supplies and equipment. will
require q continuation Of part Of the
railroad administration indefinitely.
able to turn over q practically COM
pleted task ohortly after May /.