New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1921-08-11
Rail Fund Bill
! Not SE1and-Out.'
!: Asserts Meyer
War Finance Corporation
. Head Declares He Is Au.
thor of $500, 900, 900
/. Plan and Defends Act
Assailed by Senators
Purpose, He Says, Is to Let
Public Garry Securities
Instead of Government

- WASHINGTON, Aug. 10.-Before the
- Senate Interstate Commerce Commit
y tee to-day Eugene Meyer jr.. managing
= director Of the War Finance CORPORA
- ton, was closely questioned by mem
g oers OF the committee about details
:. OF the railroad bill. A critical attitude
3 toward the bill was taken By several
= members of the committee. including
~ Senator's La Toilette, Smith and Pitt
= man. They opposed the plan to liaui-
= date the obligations of the railroads
8 which are to be turned over to the
: government and then for the govern
], ment, out OF the proceeds of the bonds.
= to pay the railroads in cash what it
: owes them.
: Senator La Toilette asked number
: of questions directed at the history Of
= the bill end tried to bring out that it
! ORIGINATED in Wall Street. Mr. Meyer
: insisted, however, that he was the au-
t..r VI the plan.
( Treasury Mellon, Secretary Hoover and
tie President said Mr.. Meyer.
you present when President
= Harding discussed the plan at con-
ference with bankers?" asked Senator
-ka Toilette.
-.s'I was not and I don't know that
ads ever was so discussed replied Mr..
Meyer.
"Do you know about Secretary Hoov-
er's trip to New York to discuss it with
the railway executives ?" asked Senator
La Toilette.
- mo; | don't know he made such a
Trip" Mr.. Meyer answered.
= B. +. T. Loan Is Discussed
Senator La Folette~ insisted the Civ
ing of the proposed $500,000000 TO the
roads would bring the government loans
to the railroads to total of 81 ,159,-
100000.
ao,-Ihis vas disputed by Mr.. Meyer.
who said the transaction proposed
would be a substitution for q similar
part of 1853 100000 already advanced
the roads.
eMr. Meyer said the government now
holds S6OI, 500 900 railroad securities
Of various kinds, bat not all Of them
will be marke. table. He said the adj
sju stment and settlement of all dis
puted matters will continue in the
hands of the Director General.
.~. Senator La Toilette brought out the
fact that the War Finance Corpora
..1vn Rapid Transit Company, and ST.
1000 600 to street railway in New Or
leans before they went into receiver
ships Senator La Toilette said he in
2 quired about these to show how the
corporation conducted business. Mr..
Meyer said the New Orleans loan was
repaid and he expected the Brooklyn
loan would be repaid eventually.
Questioned BY Senator Pomerene as
to not har this "h "a Il -oNt " NJ
Meyer said:
This is in no sense gift. On the
contrary, we shall handle the securi-
ties OF the railroads with strict view
TO their souadness and marketahility.
Senator Smith, Of South Carolina,
said there was a widespread impress
sion that this was to be loan Of
100000, goo 20 the railroads. He wanted
TO know why q balance could not be
struck between what the railroads owe
the government and what the govern
ment owes the railroads.
-, "That"can be done" said Mr. Meyer,
"as soon as the exact amounts due on
both sides have been determined"
Senator Pittman, like Senato tor Smith.
insisted it was lonn. Mr.. Meyer de-
MED this and called it a plan of rti-
nancing 10 permit the railroads to go
along. without attempting to pay their
way itoln operating expenses.
-. Senator Pittman said the net result
rould be reloaning of $500, 00o,O goo, as
: there would not be a net reduction or
liquidation of existing obligations
= ~Questio by Senator La Toilette
about the amount of railroad securi-
,"ties the government holds, Mr.. Meyer
said it was 1859, 900 600. He added that
The present estimate of what the rail
roads owe the government is $685.
100000
Then" said Senator La Toilette,
''if we lend them 100000 900 more
, now they Will owe us 81 .253 900 900