Evening star., 1921-08-09
RAIL FUNDING BILL
CONSIDERED TODAY
Director Meyer Explains to
Senate Committee Need
ed Legislation.

COHSiueFdllOn OF the administration
bill for funding of about 100000. 900
of railroad debts to the government
was begun today by the Senate inter-
state commerce committee. Eugene
Meyer, director of the War Finance
Corporation, which would have charge
of the funding operations under the
administration plan. explained to the
committee the legislation which
President Harding recently urged in
a special message to Congress.
Except for Director Meyers ex-
PLANTATION procedure with the bill was
not determined upon by the commit
tee. Republican leaders are to see
President Harding to urge postpone
ment of the bill until after the pro-
posed Senate recess.
"SimpIe." MIR. Meyer Snys.
Director Meyer told the committee
that the amendment of the transpor
tation act proposed was simple and
would facilitate the marketing of rail-
road securities held by the govern
ment as a result of government. op-
GRAFTON. 1t is only reasonable. Mr..
Meyer said, that the railroads, pro-
posed beneticiaries of the act. would
pay the cost of distributing the Secur-
tiles of the public.
Chairman Cummins of the commit
tee, who has been III. returned .today
to take charge of the legislation.
Opposes Appropriations.
Appropriations to aid the railroads,
Mr. Meyer said, were neither neces-
sary nor advisable. as the War
Finance Corporation could intervene
in "a temporary way and help restore
normal functions of the railroad in
yestment market. Private capital has
been cut off largely from railroads,
Mr.. Meyer said, because of their re-
duced earnings during the last eight
or ten months. due to acute industrial
crisis.
The government now has 1922, ,000,-
900 of the railroads equipment fund
bonds, Mr.. Meyer said, and some of
these, he believed, might be sold in
the open market. Congress would
not have to provide any additional
funds for the railroad funding before
June 80, 1922, he estimated.
THE Presidents message and the
possibility of this action already has
mad considerable effect on the mar
ket for railroad securities Mr.. Meyer
said
would be employed in railroad work
during the coming winter is, think,
a very conservative estimate.
A general economic restoration
might be expected, Mr.. Meyer Salu'
adding: '"rhen material reduction IN
railroad rates ought to follow.
COntempIates No Gift.
I'VE are on the upgrade mad this
measure would accelerate restora-
ton" Mr.. Meyer said, "and the bill
contemplates no gift to the railroads,
ample security being required. He
explained that the corporation had
over s4OO.O0O,OO 900 of it's cash fund
available for operations and power
to issue three billions of bonds.
Senator Townsend suggested that
corporation be required to- raise funds
for the funding by selling it's bonds.
Mr.. Meyer said there was mo possi-
BILE advantage" in the plan, but that
it was not objectionable.
Senator Townsend asked whether
"crisis in railroad affairs required
the legislation. Mr.. Meyer said that
he would rather that the director of
railroads be asked.
But 1 think an emergency exists"
Mr.. Meyer said, citing general busi-
ness and employment conditions
director Meyers examination will
he continued tomorrow and Director
Davis of the railroad administration
will follow