New Britain herald., 1921-07-26
Wants War Time Finance Corp. Empowered to Purchase Rail- road Administration
 Securities
WOULD USE PROCEEDS TO <
 SETTLE, WITH COMPANIES
Chief Executive Declares This Would Open Way to ''Early Adjustment and Relief'' of Railroad Problems Has No Thought of Asking for Additional Congressional Appro- prtatton.

priation.
 Washington, July 2e.-President Harding. in special message to congress today, asked 1t to extend the authority of the war finance cor poration to purchase securities, prob ably to five hundred million dollars, now in the hands of the railroad ad- mlnistration, so that the proceeds may be used for settlements with the railways.
 Wants No More Money.
 This, the president told congress would open the way ito early ad- justment and relief" of the railroad problem. There was no thought. he said of asking congress, for addi- tiona1 money.
 Railway claims, based on the 'in- efficiency of labor'' during the war, the president said, were. to be waived for the present to hasten settlement without surrender. of any rights in cured. Although the railways owe the government large sums, the pres ident said, the government also owed the railroads large sums on various accounts.
 No Added Expenses.
 .4No added expense.'' said the presi- dent explaining his request, mo add ed investment is required on the part of the, government,t there is no added liability, no added tax burden" s'.It Is merely the grant -of, author ity necessary to enable a most useful and efncient gcveruu1ent agency to use it's available funds to purchase securities for which congress already has authorized the issue and turn them, into channels of finance ready 1 to float them" Operation Contract sThe contract covering operation provided that the railways should be | returned to their owners in as good condition as when taken over by the government and the transportation ] act, recognizing that bettermentsi and I additions belong to capital account provided that such sums as the rail- way companies owed the governme nt flor betterm ents and new equipm ent added during the period of govern ment operation, might be refunded | There has been at. no time any ques- ton about the justice of funding such l indebtedness to the government Indeed, 1t has been in progress to a measurable degree ever since the re- turn of the railroads to their owners l It has been limited, however, to such cases as those in which the final lsettlements with the railway adminis- ] tration have been effected. The process is admittedly too slow to meet l the difficult situation which the
 owners of the < railroads have been
 facing, and I believe 1t essential to
 restore railway activities sand essen tial to the country's good fortune .tc
 hasten both funding and settlement
 -"Quite apart from the large sums
 owing to the government which we
 are morally. and legally bound tc fund, the government admittedly owes the railway companies large Icompensation, depreciation and main tenance.
 The way now would seem to be clear to very early adjustment and ireief, except for the fact that the railway administration though pos [sessing assets does not command the funds necessary to meet what will be it's admitted obligations.
 $5OO,OOO,ooo May Be Needed.
 There is no thought to ask con gress for. additional funds. Perhaps $500, ,o00 will be necessary. The l railroad administration has or will have in the progress of funding ample securities to meet all requirements, ii congress only will grant the author ity to negotiate these securities and ! tprovtde the agency for their negotia-
 tion.
 with this end in view you are
 asked to extend the authority of the war finance corporation so that i may purchase these railway funding securities accepted by the director general of railroads. No added ex Ipense, no added investment Is re , quired on the part of the govern } ment, there is no added liability, nt
 added tax burden. It Is merely tn E grant of authority necessary to enabl L a most useful and efficient govern
 ment agency to use it's availabl
 funds to purchase securities fo
 (which congress already, has, author
 tized the issue, and turn them int 3 the channels of finance ready to floa : them.
 : "I can readily believe that so sim I rle remedy will have your promp
 lsanction The question. Of our obi - lgation cannot be raised, the wisdor t lof affording early relief Is not to b l ldoubted, and the avoidance of adde l iappropriation or liability, will appes | to congress and the public alike.