The Washington herald., 1921-09-23
New York to Squeeze the Sponge.

i New. York City primaries that candidate
for Office there could venture to go before
those people without indorsing the present FIVE
cent street-car fare. New York hasn't hve-cent
fare with universal transfers, but person can
ride there for FIVE cents heap farther than in
the District of Columbia for seven. The reason
for the public feeling there as here has been the
conviction that under a fair valuation and good
management FIVE cents enough and that pub
lie utilities as all other kinds of business, must
meet periods of depression by reducing dividends
They cannot expect to be exceptions from uni
versal business laws and always make a uniform
profit.
The New York City transit commission has
been investigating the street railway financial situ-
alton for six months. 1t has arrived at the definite
decision that the only possible solution of the
perennial condition is to establish fair valua-
ton. leaving rates to be adjusted to this. This
is expected to create storm among those hnan-
cially interested beside which the commoton in
Washington The Heralds plain talk on the
street railway situation but whisper. How
ever the commission announces in advance that
protest will be of avail, setting example
for the District of Columbia Congressional Coun-
Gil
The stock which the report will virtually wipe
out totals SCI 5000, ,ooo 1t has large paper
value but the commission holds has real
value. 1t seems that several OF these corpora
tions are about in the condition the
Washington Railway and Electric, being bonded
to their full earning value and therefore not
titled to earn on their stock capitalization. The
marlborough Consolidated is reported as due for
a cut of SI23oooooo and the Brooklyn Rapid
Transit, S76,oooooo. Whatever is the paper value,
the holders are doomed to lose, though this will
not be until and unless the commission is up
held by the courts.
The policy of the New York body is practical
y that of the Public Utilities Commission of this
District 1t is to establish fair value which
to base rates. But this will not settle any city's
transit difficulties until all the lines consoli
dated under a single operating control. just
as long as two companies allowed
to operate on a ctys streets, there is sure to be
useless and wasteful duplication. This appears
in trackage, equipment, schedules operation and
management. The car users have to pay for
ali of it.
Here, as elsewhere, the remedy is to find the
fair value which the properties will be per-
mitted dividends and force consolidation
on that basis. This can be done in Washington
by the simple process of establishing rates for
each company on its established value. The
vivor would be the fttest 1t is absurd to fix
the value on which the Capital Traction shall
be allowed to earn and then fix its rate above
that return.
Washington merchants, realtors, contractors and
professionals do not seem to realize what is so
plain to their New York brothers: that the fun
damental OF city growth realty values, trade,
labor, mobility and health is in cheap transit
rates. If this fully appreciated here there
merger would be accomplished fact and p
E P. Co. would be divorced from street rail-
way operation and ownership.