News and citizen. [volume] (Morrisville, Vt. ;) 1881-current, 1921-11-16
Propose to- Reduce Wages and
Return All the Saving by
Reduction in Charges.
FULL TEXT OF THE PROPOSAL
Statement by Thomas de Witt Cuyler,
Chairman of the Association Of
Railway Executives on
the Situation.

Following meeting in Chicago,
October IA, 1921, of the presidents of
nearly all the leading railroads in the
country, Mr.. Thomas de Witt Guy
Ter, Chairman of the Association OF
Railway Executives, made the follow
.ng statement:
Railway Executives today, it was de-
termined by the railroads of the Uni
ted States, to seek to bring about a
reduction in rates, and as means to
that end to seek reduction in present
railroad wages which have compelled
maintenance of the present rates.
An application will be made imme
diately to the United States Railroa.
Labor Board for reduction in wages
of train service employees sufficient to
remove the remainder of the increases
made by the Labor Boards decision Of
July 20, 1920 (Which would involve a
further reduction of approximately ten
per cent?, and for a reduction in the
wages of all other classes of railroad
labor to the going rate for such labor
in several territories where the car
riers operate.
To Reduce Rates as Wages Go Down
The foregoing action is upon the I'M
derstanding that concurrently with
such reduction in wages the benefit Of
the reduction thus obtained shall, with
IF ha INT fot 70 Com
merce Commission, be passed on to
the public in the reduction Of existing
railroad rates, except, in so far as this
reduction shall have been made in the
meantime.
The arrangements have decided up
on this course in view of their real
ization Of the fact that the wheels Of
industrial activity have been slowed
down to point which brings depres-
sion and distress to the entire public,
and that something must be done to
start them again in operation.
The situation which confronts the
railroads is extremely critical. The
railroads in 1920 realized a net rail
way operating income of about S62,-
100000, upon property investment
of over $19,000,000 900, and even this
amount of 62 millions included back
mail pay for prior years received from
the government of approximately 1884,
100000, thus showing, when the opera
lions of that year alone are considered
an actual deficit before making any
allowance for either interest or divi-
dends.
The year ended in serious depres-
sion in all branches of industry, and
in marked reduction of the market de-
mand for and the prices of basic COM
modities, resulting in very serious
falling off in the volume of traffic.
Roads Forced to Defer Maintenance
Work
In this situation a policy of the most
rigid economy and of postponing and
cutting to the bone the upkeep of the
properties was adopted by the rail
roads. This was at the price of ne
glecting and for the time ,deferTing
work which must hereafter and in the
near future be done and paid for. This
is illustrated by the fact that, as of
Is, 1921, over 16 per cent
or 374,431 in number, of the freight
cars of the carriers were in bad order
and needing repairs, as against a nor
NAL of bad order cars of not more
than 10000, as is further illustrated
by the deferred and inadequate main
tenance of other equipment and of
roadway and structures.
Even under those conditions, and
with this large bill charged up against
h.. f,,f, xuhioI 10
vided for and paid ii the carriers are
70 perform successfully their transpor-
+ation duties,-the result of operations
'or the first eight months Of this year,
he latest available fiCu IS, has been |
1t rate Of net railway operating in.
come, before providing for interest or
amounting to only &c per |
cent, per annum ON the valuation of |
he carrier properties made by the |
interstate Commerce Commission in |
he recent rate case, an amount not |
sufficient to pay the interest on their |
bonds.
Roads Earnings Far Below Reason
able Return
It is manifest, from this showing,
hat the rate of return + 4 or per
ent for the first two years after
dareh l, 1920, fixed in tie Transporta-
ion Act as a minimum sonable re-
urn upon railroad in eytment, has
lot been even approynn .ted-much
ess reached; and that The present
Ugh rates accordingly are not due to
ny statutory guarantee of earnings,
or there is no such guarantee.
In analyzing the expenses which
ave largely brought about this sit
alton, II becomes evident that by far
be largest contributing cause is the
DIOR cost
Today the railroads pay out to labor
pproximately Gee on the dollar they
eceive for Transportation services,
'hereas in 1916, 40c on the dollar
'ent to labor.
On the first day of January, 1917.
hen the government took charge Of
ages through the Adamson Act, the
dor cost Of the railroads had not
xceeded the sum Of about 81, 4sS, 000,-
20 annually In 1920, when govern
entail authority made the last wage
lcrease, the labor cost Of the rail-
,ads was about s3.6eS, 100000 annual