The Washington herald., 1921-05-26
SMITH OUTLINES EFFECTS
OF VARIOUS WAGE INCREASES
Large Unplaced Losses, Result Of Decline in
Labor Effectiveness, He says.

or left undone. Inc increases IN
wages he thought were largely due
and some of them overdue, though
specific rulings under the agree
ments he could not understand. He
felt. however. that the emergency
would have been met with equal
effectiveness IL the increases had
been designated as war bonuses and
in this way come to an end auto
maticaliy when peace-time condi-
tions were restored, instead of be-
ing carried over into conditions for
which they were not intended.
Pleas for More Latitude.
A special plea was made for more
latitude under regulations permit
ting more initiative in manage
ment. He insisted that the gov
ernment had a yard-stick of duty
by which to measure his perform
ance, but as he put 1t. I'VE can
not do much nowadays. II we want
to buy anything or IL we want
to get anything. we have got to
come down and have a long hear
ing before II Is done. We must
show all there is to 1t. There is
no activity left except to run the
properties as they are. :.
would, like to sec the Interstate
Commerce commission SO placed that
they could say to me, for instance
and to my western connections
This is an emergency. Go ahead
and put in a rate and see whether
we can get this grain to market
and what is affecting it, But we
cannot do it"
He favored the labor board, but
wished II could function with more
alacrity He did not see the pro-
priety of bipartisan representa-
tion on the board. although 1t might
be held in check by Nhe three mem
bers representing the government
He felt that the bipartisan idea
which, as Senator Stanley interject-
ed, was borrowed from the Whit
ley idea in Great Britain, was well
enough IN the Informal stages OF
the controversy leading up to the
fnaI court, but that court should
be constituted. in his opinion. OF
parties that had not prejudged the
issue. He did not believe in hold
ing railroad men to their jobs in
the way soldiers are held under
compulsion. believing that the re-
lation must be purely voluntary t.
be effective. AS he said, leader
must have a willing following.
He also suggested that there
should be some experiments with
the composite rate made up of ter
minal and line-of-road charges. and
indicated that the motor truck
should be used where necessary to
avoid excessive terminal expenses
Mr.. Smith summarized the situa-
ton: I'VE have. got TO get down
to our costs. or we cannot live,
and to that end he seemed TO think
that a more lively sense of joint
responsibility for results on the
part of regulatory agencies and less
infiexibility in the technique OF reg
ulation would work much in that
direction. His testimony was es-
pecially interesting. since he boldly
questioned fundamental principles
incorporated in the present practice
of rate construction and regula-
ton.
EIliott's Testimony.
Howard Elliott, who followed
Mr.. Smith. has now for two days
continued the testimony. holding
his survey strictly to his own prop
erty. the Northern Pacific. He sub
mitted elaborate tables showing the
changes in his labor bill. Begin
ming with s62. in the three years
ending 1917. il rose to s173 in 1912
and finally reached s247 in 1890
This is partly accounted for by de-
ferred freight car maintenance left
faIa al
luded to the breakdown in morale
the powers and responsibilities OF
officers during the war period.
Mr.. Elliott is one of the supporters
of regulation. He alluded to the
$3.50. .ooo, 900 financing recently ac-
complished by his company jointly
with the Great Northern. This he
ever done outside OF government it.
self. Anticipating the large matu.
rifles that fell in the year 1921
the management for a full veal
in advance had addressed them
selves to the serious problem of ef-
fecting so great a financial trans.
action in the present disturbed STATE
of affairs. They carefully worked
out a plan for accomplishing this
made the preliminary tentative ne
gotiations and proceeded to Wash
ington for the necessary author
ity. They applied in November
1920. The hearing was set for De
cember. and adverse decision wa,
rendered in the latter part of Feb
ruary. There had not developed
any illegaiity in the proposition. no
any objection by any stockholder
nor any state save Illinois, and IL
objection was not in a major phase
The plan was turned down on I
difference of judgment of the none,
market conditions and the prope
method of financing between tn,
interstate commerce commission
and the management The com
pany had then but four month
to evolve and tentatively arrang
another plan. In his judgment tn
original plan was much the bet
ter and saved the companies 81,
500. 900 to $3,o0o.ooo a year. Tn
money cost the companies tx pc
/ cent and fha dehfe rnfnn1ad xv.r