The Barre daily times. (Barre, Vt.) 1897-1959, 1920-07-20
INCREASES NECESSARY
In Order to Guarantee Six Per Cent on
Railroad Stocks.

Washington, D. c., July 20.-ln pre-
senting their applications for freight
rate increases, the railroads contend
ed before the interstate commerce com.
mission that sl,lO7 100000 was netes-
sary to advance their income to the six
per cent basis permitted by the new
transportation act. Shippers and state
commissions generally agreed that
some advances were necessary, but
they opposed both the total and the
method of application.
Passenger rates, the carriers pro-
posed. would be left unchanged and
their program Of advances, applicable
throughout the country, did not take
into account any wage increases made
by the railroad labor board.
The advances as proposed were:
Eastern roads, 30.4 per cent, to yield
an advance in all revenues of FLA per
cent, or S544,000,000.
Western roads, 23.9 per cent, to ad-
vance all revenues IL per cent or 1852
500 900.
Southern roads, 500 per cent, to pro-
vide 207 per cent larger revenue. or
Sl20,770,00o
Apart from these advances, 80 roads
in the southwest asked separate treat
ment from the western classification,
and rate increase of 1928 per cent.
An estimated valuation of S20i6l6,-
100000 placed on the transportation
systems by their owners was ques-
toned by both shippers and state utili-
ty commissions, who complained that
book value was unreliable, while
the carriers contended that their fig
ures were conservative, especially be
cause of rising cost of materials and
equipment. Increases in passenger
rates, and fat freight increases instead
of the percentage advances, also were
advocated by shippers to equalize the
burden of any advance.
Setting out the necessity for the in
crease, the railroads claimed that the
net income of all the country's roads
fell from 81 ,056,OOO,OOO in 1916 20
$50 900, 900 in 1919, while their in
vestment was increased more than s.
O00,0O00O0 Operating expenses, the
roads said, have increased 99.l per cent
since 1915, and revenues 1857 per ceut.
Operating expenses, it was added, are
now 10 per cent Of the revenues,
against 6s per cent in 1916.
Arguing for the increases, the rail
road executives said the one billion
dollars Of added revenue was neces-
sary if the roads were to handle the
nations commerce satisfactorily. They
contended that savings promised by
them could not be effected at once
because the roads were not returned to
them in the same conditions as they
we're when taken over and because Of
unsolved labor difficulties.
Clifford Thorne of Chicago, repre-
senting shippers, recommended to he
commission that the roads be unified
for operation as they were in 1917, de
claring that only in this way could the
roads solve the existing transporta-
tion problem
Mr.. Thorne also argued that the rate
advances asked were excessive as the
carriers had not made any provision Ter
more efficient operation or for de-
creases in the cost of materials. He
also argued that the companies Sc
too high a value on their properties
and that they were capitslizing land
granted them by federal and state go..
ernments without cost and asking the
people to forever pay tax on these
free gifts.