The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1921-02-26
Railroad Ne1us of Week
BY " E. BUNDY.
BY V. E. BUNDY.

to the railroads and to the interstate
commerce commission is to meet this
particular emergency.
Can't Boost Rates Higher,
"a further horizontal increase in
rates does not seem practicable, as it
would further check the business of
the country. While we know this con-
dition of affairs is only Temporary,
and that the business of the nation
must revive, we do not know how soon
this will be, and this is a very vital
question to many roads. Before the
revival comes they may find them
selves on the financial rocks.
public Must Pay"
"As a consequence of the above con-
ditions there is, at the present time.
determined effort to economic, but
this is done by postponing expendi-
lures rather than by more efficient
handling. This matter of efficiency
has been sadly hampered by the actual
working of the transportation act COW
ering the handling of labor Prac-
tically all questions involving labor
must be passed upon by the labor
board before they can be applied. and
this process operates for Slowness In
making changes which in turn does
not permit the railroads to avail them
selves OF rapidly changing conditions.
If this drawback cannot be overcome
it will be impossible to affect much
economy in this particular direction
and this must be the price the public
must pay for reasonable stability in
labor matters as affecting transporta-
ton.
Men Don't Work Now.
1T might be said in this connec-
ton that ir the mechanical department
of the Santa Fe, the men are accom-
plishing only SIS per cent per hour of
the amount of work which they per
formed before the period of govern
ment control, and the leaders of the
men have openly said to us that they
do not propose to work as they for
merly did.
Assuming however. that the stormy
periods of low earnings and the labor
question are passed safely, there is still
a very serious problem ahead-name-
ly, the financing of future capital ex-
penditures.
The transportation act tried to take
care of this by decreeing that the earn
1ngs of the valuation of groups of
roads should be 5 Ia per cent. This
was on the assumption that with such
earnings any road could borrow all the
money it needs. 1t has not turned out
in that way. In the first place, we
have not yet received the 5 y per cent:
in the next place, 5 u per cent wilIsnot
get the money; and finally, any money
that can be raised will not buy the
sunny oAAlOdlll as OclOIe the war. NO
road can afford to borrow money ar
above per cent, and be allowed to
earn only 6 II per cent or per cent.
You might stand such diet for a
snort time, but as steady thing you
would soon find yourself growing very
thin.
The Santa Fe's Experience
GU may be able to realize more
readily this problem if I illustrate by
means of some of the affairs of the
Santa Fe railroad. For five wears
prior to 1914 it expended annually for
additions and betterments and equip
ment, 100000. This amount,
therefore, may be taken as represent
ing the amount necessary to take care
of the growth of the country along its
lines. To provide the same enlarge
ments today would cost more than
$4O,OOO,OOO year. But, for five years
we have not made the usual additions.
due, first, to the high prices caused
by the European war; next, to our own
entrance into the war; and finally to
the period Of government control when
all work that could be POSTPONED was
deferred to help win the var. We are.
therefore, several years behind, and
the growth of the country meanwhile
mas been very much more than nor
NAL.
What 1t Will Cost.
AS a minimum, 1 should say that
d
year to catch up with these deferred
items, for a period of at least three
years. This would make a total of
sixty millions a year for three years, or
$50 millions to be expended to put US,
with relation to the business of the
country, at the end of three years
where We were in 1914. Apply these
figures to the railroads of the country
and You have the stupendous sum of
one and a half billion dollars a year
for three years, which should be spent
in all and charged to capital account
the railroads face, namely, how to
raise such very large amounts of
money and at the excessive rates of
interest row necessary. Until this can
be done, ~the railroads will have to
struggle to carry the load and will do
it with satisfaction neither to them
selves nor to the public.
Has Not Solved Problems.
THE transportation act has not
9olved all our problems. 1t has made
the solution if some of them possible.
l can only say that in spite of the
magnitude of the obstacles 1 have great
faith in the ultimate outcome. 1 be-
lieve in the ability of American rail-
way men, and L believe in the COM
mon sense of the American people, and
that these two forces will ultimately
find the solutions of the problems I
nave lrleu TO picture TO you
A Forecast of Result.
A forecast of the probable result of
the Interstate commerce commission
hearing. which is to be held in Topeka
March 1, to decide whether the intra-
state rates for Kansas which have been
prescribed by the commission or the
rates which were set by the court of
industrial relations, shall prevail, is
found in the fact that in two other
similar cases, recently settled, the state
authorities lost out.
The last two cases of the sort to be
settled were in Illinois and Nebraska.
In both states the rates were raised