Evening star. [volume] (Washington, D.C.) 1854-1972, 1920-08-22

months guarantee costs Uncle Sam out of the
to be added to the $4,000, 900 already shown
to be due the railroads under the ola pasds, OF
wages. That makes a total of 1851 900 900 for
six months or at a rate of $1.374000,0 900 per
year.
Sam-and therefore saved to the taxpayers
by the expiration of the guarantee period,
which marks practically, the starting of the
new rates. but it is estimated by expert gov
eminent officials that the increased rates Will
net s1ooooo.ooo in. taxes per year The per
cent tax passenger fares. which has yielded
about 500 900 to the geyern nm ed is eX-
tionaI taxes on Pullman tickets expected
s3s,55oooo The other $40, 100000 is expected
profits taxes which the railroad corporations
will have to pay as result of larger earnings;
that this amount should be added to the
1874, 900, 900 to show the decreased tax burden
bring about-a total of s1.474 100000. 1t is on
this estimate that the claim is based that the
ping of government payments that insure
fair return to the railroads, will result in a
substantial revision downward of taxes.
And if taxes are thus reduced the increase
in the cost of living threatened by the larger
railroad rates would seem to be offset. Under
the present system, it is contended the in
creased rates paid by income and excess
profits taxes-$1 474, O00, goo paid by taxes
against $1546,Ooo,ooo estimated to be paid
through increased rates. Instead of paying
excess profits taxes to Uncle Sam the vendor
of clothes shoes dresses pays the equiva-
lent sum to the railroads in larger freight
rates; instead of paying large income taxes
the individual pays an increased fare when he
goes on his vacation or takes business trip:
The two total amounts nearly equal
that it is argued that it is mere difference
in the manner of payment.
The claim is therefore made that the in
creased charges allowed the railroads will not
increase the cost of living to the individual.
Friends of the railroads and students of the
transportation problem go farther and contend
that there is real possibility that the cost
of living may be lowered.
This argument is based the idea that the
increased revenues will enable the railroads
= to improve transportation facilities much
that the saving to shippers will, in itself. Off
set the increased transportation charges. Dur
ing the hearings before the Interstate Com
merce Commission the petitions for higher
rates shippers than occasion
stated that the poor transportation service then
accorded them was extremely costly and that
in their opinion higher rates. such would
be found just and reasonable by the commits
sion, would be cheaper in the end. 1t was
shown that the railroad employees. unable to
make both ends meet on the wages they were
then receiving. were not performing the
amount of work they were capable of doing
when not worried about the prices of the
necessities of life. 1t in evidence that
the railroads. with inadequate revenues under
the steadily mounting higher prices and costs
of operation and unable to borrow funds were
not able to make necessary improvements and
betterments which would facilitate transpor-
tation and insure more economical operations.
Delays in the transporting of materials
and finished products made it necessary for
producers, manufacturers and merchants to
carry long credits at the banks. 1t
gued that the interest saved these credits,
under prompt shipment and delivery of goods,
would practically meet increased freight
charges.
X X
Senator Cummns, chairman Of the Senate
committee on interstate and foreign commerce
and co-author with Chairman Esch Of the sim
liar House committee of the new transporta-
ton act said in a recent interview at Marion
Ohio:
t'The inability of the railroads to do the bust
ness of the country is costing the country
the people any day"
F1nanciers and railroad executives have ex-
pressed their solemn judgment to the Inter-
state Commerce Commis sion that the granting