Indiana daily times. [volume] (Indianapolis [Ind.]) 1914-1922, 1920-09-13
SAYS CONTROL
OF ELECTRICS
MUST BE EASED
Pardee Declares Commissions
Are ThrOttling Service
in u. S.
ENDORSES CREDIT IDEA

WASHINGTON, Sept. 13.-Credit, vitality
needed by electric railways throughout
the United States, can best be restored
by regulatory bodies making their con-
| troll and the rates of returns to lines
more flexible, John H. Pardee, president
of the American Electric Railway Asso-
citation, declared in a statement issued
here.
| He Endorsed strongly the declaration Of
| the Federal Electrical Railways Com
mission, in its report to President VIII
/ son, that the first essential to the in
dustry is TO restore credit.
I'm the electric railway industry,
| Mr.. Pardee said, las in every other bust
ness. economic law dictates that the
price of the product must be based
on the cost or producing it. In the
! attempt to regulate the profits and the
| service of electric railways, this truth
has been lost sight of and the operation
| of these carriers has been so hedged
about with laws. ordinances, regulations
and contract restrictions that in the main
/ their revenue has been controlled by the
| dictum of commissioners and other reg
/ ulatory authorities, while their expenses
have been controlled by economic law
alone. and have mounted as expenses in
I all Otler business anu dSlouS lhC PAA
vate individuals have mounted.
| THING NECESSARY
/ TO BE DONE.
ITO restore electric railway credit 1t
| is essential that these artificial methods
/ of fixing electric railway prices should
/ be done away with AS the commission
/ well states public control must be fex-
/ ibIe enough to enable them TO secure
sufficient revenues TO pay the entire
: cost of the service rendered, including
/ the necessary cost of both capital anu
/ labor
The report of the Federal Electric
/ Railways Commission he continued,
/ strongly EN- phasizes its finding that the
1 systems of electric railway transporta-
4 ton are permanent, essential to, and
must be preserved for the social and
economic functioning of our cities ana
/ communities.
"A very acute sitaution exists among
I the electric railways at the present tine.
/ The abnormal increase In urban popG-
lation. which has marked the develop
ment of the country during the last
/ thirty years, continues, as is evidenced
/ by the latest census returns. The prob
/ lem of caring for these new millions or
/ city jewellers is not alone one of proyid-
| ing dwellings, it is equally q problem OF
/ providing local transportation facilities.
The industry needs Immediately for
/ such extensions and betterments and fo-
the rehabilitation of existing properties
which have deteriorated during the war,
/ between $500 600, 600 and S4OO, OOO, 900 Of
new capital and it will need for years
/ to come an average of more than $500,
100000 a year, exclusive of its refunding
/ obligations
HOW INVESTORS
CONSIDER 1T.
To-day, the investor looks askance at
electric railway securities, and 1t is prac-
tically impossible for these companies
/ to dispose of either their stocks or bonds.
Under such circumstances, 1t Is no
| wonder that the commission declared that
/ the first essential is to restore credit.
/ No impartial investigator can come to
any other conclusion and it cannot too
/ forcibly be brought home 10 the Amer
/ lean public, that unless the confidence OF
| the investor be regained, the electric rail-
ways of this country, which represent
an outlay of more than five billions Of
dollars. will cease to function properly
and viii prove of little avail in the solu-
/ ton of the housing and transportation
problem which confronts almost every
| community in the entire United States.
tates the way in which this must be ac-
complished. The credit OF the industry
was destroyed because its revenues were
insufficient to provide a return salts
factory TO the Investor and at the same
time to provide surety that this return
should be continuously forthcoming.
DEMAND OF
PUBLIC INTEREST.
The social service performed by these
utilities is their most important function
and the public interest demands that no
undue obstacles should be put in the way
| of the performance of their full public
duty. They perform an essential public
service, which as the commission points
out can be performed by no other means
of transportation now in existence. They
should not be weakened in their abihty
to serve the public by the competition Of
jitneys or city buses which cannot ap-
proach the complete service rendered by
electric railways; they should not be
compelled to bear an undue burden of
taxation and public charges and they
should be given freedom to put into Oper-
alton every practicable operating econ
omy that is in the public interest. Only
in this way are low fares possible and
the lowest fare compatible with the pay
ment of full cost of service, including a
return that will attract the necessary new
capital is in the interest of both the pub
lie and the companies"