The labor journal. [volume] (Everett, Wash.) 1909-1976, 1921-05-27
(By Charles NJ. Kelley


Declaring positively that the rail
roads of the country are in the
'throes of DEATH" and that only a
few will be able to "hang on" the
Association of Railway Executives,
through its spokesman, Julius
chairman Of the
Southern Pacific board, presented
new and amazing demands to the
Senate Committee on Interstate
Commerce, which is overhauling the
entire railroad situation.
These demands, called the rail
roads five points" are:
l. Lay tolls on the Panama
Canal that will discourage traf-
fic and practically limit a
government investment of
$45O, 100000 to war purposes.
2. Lay tolls on automobiles
and trucks operated for prof
it that will drive them off the
highways built by the public
at cost of many hundred mil
lions of dollars.
3. Discourage water trans
portation by laying prohibitive
tolls on its commerce.
4. Restore the old short
and-long-haul practice, with its
destructive discrimination.
5. Reduce wages of railroad
workers.
Falling to comply with these
stipulations, Congress will be eX-
pected to provide these alternative
remedies:
Subsidy Is Alternative
/. Appropriate out of the public
Treasury subsidies that will yield
the railroads sthe per cent guar
anty of the Cummins-Esch Act.
2. The retention of existing
freight and passenger rates and such
increases as may be necessary to
provide adequate operating costs.
3. Freedom from regulations that
interfere with the Initiative of
railroad managers.
1t is putting it mildly to state
that members of the Senate Com
mittee, including Senator Cummins,
Joint author of the transportation
act, where stunned by the audacity
of the railroads suggested solution
of their problems. 1t was anticipat-
ed that the managers would appeal
for continued government support
and some members of the commit
tee were prepared to support legis-
Iation appropriating funds for this
purpose, but they were not ready
for anything so drastic and revolu-
tionary as is implied in the sug-
gestiOns that the public be driven
from the highways and that the
Panama Canal and other waterways
be reduced to Junk.
After several days of close exam
ination of Kruttschnitt, in which he
answered clearly the questions he
wanted to answer, Senator Cum
Minis admitted that he was worried,
Private Control Challenged
The situation as it was outlined
by the authorized representatives
of the railroads, he said, challenged
the permanency of private owner
ship. He was frank enough to
say that unless some way is found
to increase revenues and reduce eN-
penses the railroad deficit will have
to be met from the national treas
ury."
The testimony presented by the
railroads convinced him and
other members of the commit
tee that the railroads will not
be able to survive under eX-
isting conditions even if wages
of employees are cut below
starvation level.
Kruttschnitt declared sorrowfully
that after expenses are reduced the
roads will still be short. "The out
look is anything but encouraging
bad" he testified. Some
of the roads may be able to hang
on. l am afraid, however, that
many will lose their grip and go
into bankruptcy"
Nearly everything that can be done
in the way of economies has already
been done, he said. The big saw
ings have been effected, and only
a few odds and ends remain to be
"The molasses is all out
of the jug, and we admittedly are
in a bad way" he confessed, and he
couldn't "for the life of him" see
now lfelSnI ana passenger Idtes
could be reduced, unless-and he
this point-"the govern
ment is prepared to make up what
the roads will need to operate and
pay an adequate return to capital" "
Railroad Head Outraged"
Kruttschnitt regarded it as out
rageous" that the government should
be in competition with the rail-
roads. The Panama Canal last year
took $50,000,000 in freight rates
that would have gone to the rail
roads had traffic through it been
checked. Millions of dollars have
been expended in highway improve
ments, thus encouraging transpor-
tation by motor trucks, and he
thought this should be stopped.
at provokes me when a ten-ton
truck forces my automobile into
the ditch, because it has freight that