The Birmingham age-herald., 1921-08-28
ENORMOUS SUMS
 OWED UNCLE SAM
 BY THE RAILROADS
Amount Climbs Steadily of Late Until It Now Stands at About Seven Hundred
 Million Dollars
-sr Fly HARDEN CoLFAx Special Correspondent of The Aae-Heyald. f7 Copyright, Iesi. by The Ase-Hcraid.)

' (CopyriEht, iesi, by The Age -HeraIdD Y Washington, August 27.-What the railroads owe the government has been mounting steadily during the last few months until it stands at not far from s7oo,coo. 900, o6o This railroad mortgage, upon which inter- est must be paid promptly, and regu- iariy if the House is not to be the loser is a grown factor in shaping iegisiatlon and is certain. to be con sidered In any plans Congress may adopt to put the carriers on sound and paying basis.
 More than half of the entire amount is covered by obligations of nine railroads alone.
 The Pennsylvania railroad owes the government s75,S24,ooO representing money advanced during the period of federal control and afterwards to cover improvements and betterInentJ and other contingencies.
 The New Haven railroad, next in the size of its debt, owes s75,i7o,Oo0. of which more than s60,0oos00o repre- sents betterments to the limo ana equipment during the period of fed eral control.
 Next comes the Chicago, Milwaukee and St. Paul whose obliga tions 10. tn 6 government total $eo, 900.
 Three Roads Owe Much
 Those three roads alone owe the government one third of all the money tied up in it's list of railroad securities, according to the treasury. their debt aggregatng more than 3210,0o0, 900 The other six roads in- ciuded in first nine debtor carriers, III the order of their obligations are: New York Central s46,o3i, 900; Boston and Maine, s42,e25, 0oo Baltimore and Ohio. s2s, ,40S, 0o0 Great Northern, {21,91S,00o; Missouri Pacific, 319620, Oeo; Erie, s15.45l,oo0.
 Tho total debt of the nine roads cited Is $38S, 900.
 More than loo carriers have ob- tAined money from the public treas ury. either in the form of cash or in expenditures for betterments, equip n1ent or other facilities and have given their notes or bonds in ex- change. In the long list, advances 10 individual roads of from one to Hirteen millions are the rule; ad- yences below s1,ooo.ooo the excep- tion. Even so strong a carrier fi- nancially as the Illinois Central is represented with obligations total ing nearly sl3,o0o,0 900.
 Interest at Per Cent
 1nterestis payable on these obli- gaticns at the rste Of per cent an nually and in the case of S31o,001, 900 Of the debt per cent of the princi- pal is to be retired every six>months The eovernment paid cash for the equipment and in turn took the roads notes.
 Up to the present time the carriers have not defaulted a penny in their interest payments, notwithstanding the falling off in income. Any credit rate reduction, however, the carriers claim which would effect materially and adversely. net income will make more difficult the burden of meeting interests payment on this debt.
 The debt as represenetd by the gov ernment-held securities in addition to about s5o0.o0o, 900 owed the gov errment by the roads and not as yet funded. The railroad administration under the proposed administration relief act would make settlement with the carriers for this $500, ,0oo, 900 by accepting the carriers securities and through the war finance corpo- ration have them funded. The pro- ceeds would be used in paying the carriers what the government owes them for rental of their property and for. other claims.
 Few of the class one railroads those doing a, business of more thar 100000 annuaily---are not found in the Hist of the governments debtors Even Henry Ford's line, the Detroit Toledo and Irontcn is down for $7ss,ooo representing improvement made to the line and equipment pur- chased during federal control