The Democratic banner. (Mt. Vernon, Ohio) 1898-192?, 1920-01-06
OUR WASHINGTON LETTER
By The Banners Correspondent
J. e. JONES
Washington, ID. c., Dec. 20.
Senate Passes Cummins Bill
J. e. JONES

hard tussle, but finally got through
the Senate before the holiday recess.
The House having passed the Esch
bill. the two measures are now being
in Conference, by a COM
mittee representing the Two legisla.
tive bodies, and there is strong hopes
that an agreement may be arrived at
so that the railroads may go back to
private management on safe and
sane basis. The debate on The return
of the roads was eventful in Congress
sional proceedings, since the discus.
sions were rich in unfolding every fea.
ture OF the industrial situation. and
the controversial points were thor
oughly threshed out. When II looked
as though the legisla ion might go ov-
er till 1920. Senator Cummins caustic-
ally reminded the Senate that It was
'the known habit of Congress to de-
lay everything until the necessity be.
comes obvious to even The most in
different mind" He warned his col.
leagues that II the railroads were
turned back without prospective leg
islatiOn, that chaos would follow, and
said that "if the roads should be re-
turned without effective legislation
they could last about month. and
then they would fall into hopeless con-
fusion, and two-thirds OF them would
be in the hands OF receivers"
Senator Kellogg OF Minnesota, fur
nished some illuminating figures on
the railroad situation, and he told
the Senate that he had learned from
Interstate Commerce Commission
sources that out OF 165 Glass One
railroads 1OS failed during the first
three quarters of 1919 to earn their
fined charges for tha. period In 9TH
err words, instead of earning sur
plus for the payment of dividends to
stockholders, they have not even
earned their interest charges and the
stockholders would thus be left with
a deficit instead Of a surplus. The
balance over fixed charges earned
by The remaining 81 roads is not suf-
ficient by $56,O0O.0OO to overcome the
deficits of the other 108.
"These tables show that practically
two.thirds of the railroads of the Unit.
ed States must inev, ably go into the
hands of receiver unless their con
ditions are impr9ved--and these are
not the poor railroads." said Senator
Kellogg, they are such lines as the
Pennsylvania, the Baltimore and Ohio
the Great Northern. the Southern Pa
cific, and many q hers. The Govern
ment took over these railroads in a
solvent condition, and while, of course
it has paid. during it's operation, a
fair rental for the properties, it has
increased the operating expenses SC
greatly that when they are tturned
/ back they will be bankrupt and can
not from their earnings pay their op
Grating expenses and fixed charges
without one dollar for dividends. A
railroad is worth what it will earn.
"We have no right to take over 9
public-service corpora ion and use il
for Government purposes, increase It's
operating expenses so as to render the
property valueless, and turn it bacl
without any remedy. Furthermore
should this be done. financial col
lapse in this country is bound to fol
low, and as the bonds of these rail
roads are held in savings banks, in
surance companies, and by millions o
individuals, and are large basis o
credit, The greatest care should b.
taken to preserve their integrity
81 wish to save the railroad system
of this country from utter bankruE
cy, because railroad efficiency is neet
ed on every farm and in every vi
lage and in every single industry tina
exists in the country; and doubt
Senators realize the serious cOnditiO
confronting the country. do not car
whaI basis of value you take; | wi
take the valuation fixed by any boar
in the world that is fair. The raj
roads today are not earning anywher
near percent upon their value. L,
eryone knows. of course, that tn
bonded Indebtedness of the roads |
!. far below, six or seven billions b,
low, any valuation which will be pla,
ed upon, them
Sen:I or Kellogg pointed out e,
amples OF large unnecessary expend
lures under government operation {
the railroads and made vigorou
plea for return to private operatio
without delay, but with legislatio
which would make possible the gradl
al overcoming of the handicap unde
which roads would have to labor III
on their rd urn to their owners.
BIRTHS