The New York herald., 1921-03-31
THURSDAY. MARCH 81, 1921.
Harding Awake to the Grave
Railroad Situation.

ernment, which both controls the traf-
flc rates and fixes the greater part Of
the expenditures Of the railroads
the wages-has awakened TO the
fundamental errors Of it's policy and
to the fatal consequences of it's prac-
tice there is some hope not only for
the belabored transportation system
itself but for the stalled industry OF
the country.
A total railway payroll which is a
hillion dollars and more In excess of
what the total traffic charges against
the public were before the war breaks
the strongest railroad back But an
unscientific, unbalanced, preposterous
mess of rate schedules, while failing
to produce the revenues needed to pay
the inordinate wage scales and keep
the roads running, kills national in
dustry and business.
On May 6, 1920, while the Inter
state Commerce Commission was con-
sidering the appeal of the roads for
more traffic rate boosts to meet wage
Increases and other rising expenses,
THE New YORK HERALD declared
against any further rate increases
slapped upon traffic regardless of
whether they would dry up shipments
or not. We expressly warned that
the Interstate Commerce Committee
rate makers must send the scheme
which had been instituted by horizon
tal rise upon horizontal rise TO the
up heap. THE NEW YORK HERALD
I'd then and repeats now:
"It IS elementary in traffic arith-
snetic as II Is in tax principle and
practice that some rates can be in
creased largely without a diminish
ment of traffic flow. while IL others
are lifted only slightly they will pro-
duce no more revenue. may produce
even less.
.'F'rom the point Of view of the
railroads the problem is to get the
greater returns without an over
straining OF equipment and organi-
ration. From the point of view OF
the country, however. the problem is
to yield up those greater returns to
the roads without causing particular
and essential industries TO stagger
under their loads II such INDUS
tries are ov9'burdened by freight
rates they win slow down In their
productive yield and economic per-
formance for the public just as they
will when they are overburdened by
labor charges or taxes
"The old railway rule. brutally
expressed but economically sound,
was to charge the traffic what II VIII
bear. This is the very doct,ine
which the Interstate Commerce Com
mission, though loath to preach 1t.
will have to practise TO assure:
First. to the railroads the income
they must have to operate properly
and 70 remain solvent.
Secondly. to the farms. mills .nd
factories the freight tariffs they must
enjoy to get to market
tiles they must receive day in and
day out from all over The country to
be able to eat to work and to per-
form all their parts In our complex
national life as economic machines.
citizens and human beings"
But under the pressure of the
emergency, with the railroad pay rolls
greater than could be met out OF
earnings, with the Government about
TO quit covering the hundreds of
millions Of deficits with taxpayers
cash, and with the transportation
managers frantic over the lmpend-
ing wreck. the Interstate Commerce
Commission could not or did not make
the new traffic schedules with due
regard to the results they would have
on railway shipments and general
business. The rate increases, for the
most part, were smeared all over
the freight classifcations and tariff
sheets like whtewash plnstered slap
dash on wall. Commodities that
could have carried heavier ioad
without slowing down the shir@onts
did not get Il. Others that could
barely keep on going as II was got
enough more to stop, dead short. Be
tween the business depression and
the prohlbtlve freight rates the Amer
team railroad rolling stock began to
pile up in the car sheds and on the
side tracks.
Now II has become not mer ~ n
situation where Texas rice and
onions which hnd gone to market liz
New York aud Chicago can no longer