The labor world. [volume] (Duluth, Minn.) 1896-current, 1921-05-28

have. been lootng the transportatiL (
system are unable to make good.
They find it absolutely impossible to
liquidate the excesses of more than
a half century of vile management,
featured by every species of looting
and graft that ingenious minds could
devise.
In other words, the railroads are
caught in the economic net that the
managers have been spinning and
congress is unable to extricate them,
no matter how earnestly it may strive
to do so.
Railroads Are Whipsawcd.
When the transportation act was
being considered by congress the pre-
diction was made that if enacted it
would not in any measure solve the
problems of the railroads. It was
recognized as an unscientific. unecon-
omic effort to artificially influence
the immutable law of sound busi-
ness. 1t had for it's main object the
recognition of the billions of dollars
of fictitious capitalization that had
been ploughed into railroad invest
ment accounts, and then it set about
to guarantee a fixed annu Il return
on all this capitalization. 1t directed
the Interstate commerce commission
to establish rates that would yield
the carriers per cent annual in
come upon approximately $19,O00,-
100000. In obeying it's instructions
the commission brought about the
ratio of diminishing returns for
higher rates restricted, traffic and
defeated the purpose that congress
had in view.
There is difference of nearly a
billion dollars between what the roads
say they must have and what they
are really getting. Unless they can
effect economies that will close this
gap, they must have higher rates
which will aggravate and not palliate
their troubles-or go into receiver
ships.
OF course, railway managers harp
great deal about extravagant wages
paid to workers. but this is simply
blind to conceal their own incom-
potency and dereliction. If the work.
ers are reduced to a starvation level
the railroads will not yet have solved
their financial difficulties. They
must do something for themselves
Of the slip pay envelopes of workers
the amount needed to maintain g.
system founded largely on extrava-
gance and graft.
1t must be clear to open-minded
students Of the railway impasse that
the only real and abiding way out
lis to retire private managers and
place transportation under govern
ment control. Two years ago those
who urged the Plumb Plan as a rem
edy contended that it alone could
afford real and permanent relief
They pointed out the things that
would happen to the railroads If the
government lost control over them,
and everything prophesied and much
more has since transpired. The rail-
roads are even in worse shape than
their severest critic had dared to
forecast. They are breaking down
everywhere, and it is dawning upon
the sinsle-minded gentlemen who are
responsible for this condition that
1~@tslation will not help an incur
able maIady.
%GOvernn1cnt Ownership Coming.
When such astute defenders of pri-
vate. control as Senator Cummins Is
forced to admit that it is a failure
and cannot exist, the end of~its ruin
GUS rule cannot be far off.
To save the managers the govern
ment will. find it necessary to heav-
lily: Subsidize the carriers, and it is
inconceiVable that any politician who
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