The Dillon herald. [volume] (Dillon, S.C.) 1894-????, 1921-11-24
propose to Reduce VIZ s and
Return All the Saving by
Reduction in Charges.
FULL TEXT OF THE PROPOSAL
statement by Thomas Dewitt Cuyier,
Chairman Of the Association of
Railway Executives on the
Situation.

s statement:
At meeting OF the Association of
Railway Executives today it was de-
termined by the railroads of the
United States to seek to bring about
Ia reduction in rates. And as a means
to that end to seek a reduction in the
present railroad wages which have
compelled maintenance OF the present
rates.
An application will be made imme-
diately to the United States Railroad
Labor Board for a 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 n
further reduction OF approximately 10
per cent? and for a reduction in the
wages of all other classes of rail
road labor to the going rate for such
labor in several territories where the
carriers operate.
To Reduce Rates as Wages. Go Down.
The foregoing action is upon the
understanding that concurrently will
such reduction in wages the benefit
or the reduction thus obtained shall
with the concurrence of the Inter
state Commerce Commission, be pass.
ed 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 upon this
course in view Of their realization OF
the TACT that the wheels of industrial
activity have been closed down to a
point which brings depression and dis
tress to the entire public and that
something must be done to start them
again ia operation.
The situation which confronts the
railroads is extremely critical. Tho
railroads in 1920 realized a net rail
way operating income or about S62
ooo 900 upon a property investment O
over $4,000, 100000 and even thi:
amount of seq 900 600 included bacl
mall pay for prior years received from
the government of approximate.
S64,0o0.00o. thus showing, when the
operations OF that year alone are con
sidered. an actual deficit before mai
ing any allowance for either interes
for dividends.
The year ended in serious depres
sion in all branches of industry ant
in marked reduction of the market de
mand for and the prices of basic com
modities, resulting in a very seriou
falling of in the volume OF traffic.
Roads Forced to Defer Maintenance
In this situation, a policy of tht
most rigid economy and of postpon
Ing and cutting to the bone of the up
keep of the properties was adopted
by the railroads. This was at tht
price of neglecting and for the tim,
deferring work which must hereafter
and in the near future be done and
paid for. This is illustrated by thc
fact that, as OF September Is, 1921
over 16 per cent. or 374,431 In nun
Der, OF the freight cars of the carrier
were in bad order and needing IL,
pairs, as against a normal of bad or
der OF not more than 10000 as i.
furt.er illustrated by the deferred
and inadequate maintenance of other
equipment and OF roadway and struc.
lures.
Even under those conditions. an(
with this large bill charged III
be provided for and paid IL the car
rfers are to perform successfully
p their transportation duties-the re
suit of operations for the first eigb
months OF this year. the latest avail
able figures, has been at a rate of ne
railway operating income, before pro
yiding for interest or dividend
amounting to only 2.6 per cent ne
annum on the valuation of the car
rier properties made by the Inter
state Commerce Commission in thu
recent rate case. an amount not SUI
ficient to pay the interest on the
outstanding bonds.
Roads Earning Far Below ReasonabI,
Returns
II 10 manifest, from this showing
that the rate of return of 5h or
per cent for the first two years afte
March l, 1920, fixed In the Transpor
tation ACT as a minimum reasonabl,
return upon railroad Investment. ha
4 not been even approximated. muc
less reached; and that the presen
nigh -ates accordingly are not due [,
any statutory guarantee of earnings
for there is no such guarantee.
In analyzing the expenses whicI
have largely brought about this ait
uation, 1t becomes evident that b,
Tar the largest contributing cause 1.
the labor cost.
Today the railroads pay out to la.
Dor approximately 60 cents on the dol.
hr they receive for transportation
t1ervfces whereas In 1915, 40 cents ON