The New York herald., 1921-10-15
Continued from First Page.

thing must be done to start them again
in operation.
THE situation which confronts the
railroads is extremely critical. The rail-
roads In 1920 realized a net railway
operating income OF about $62.OOO.O0o
upon property investment of over $1s.-
900. 600. 900. and even this amount OF
$50, 100000 included back mail pay for
prior years received from the Govern
ment Of approximately $64.000.000, thus
showing. when the operations OF that
year alone are considered. an actual
deficit before making any allowance for
either interest or dividsnds.
''On the frst day Of January. 1917.
when the Government took charge OF
wages through the Adamson act. the
labor cost OF the railroads had not ex-
ceeded the sum of about $1.46S. .000.0 900
annually. In 1920, when Governmental
authority made the last wage increase,
the labor cost of the railroads was about
ss.698. 100000 annually. or. II continued
throughout the year instead Of for the
eight months during which the wage in
creases were in effect, the labor cost. on
an annual basis. would have been large
ly in excess of SO, 900. 900 ,000--an in
crease, since the Government took
charge of railroad wages in the Adam
son act, Of approximately $2,450. .000.0 900
annually. In the light of these figures
II is manifest that the recent reduction
Of wages authorized by the Labor Board.
estimated at from 10 to IL per cent. In
no sense meets or solves the problem
of labor costs and in no way makes II
possible for the railroads to afford
reduction IN their revenues.
Indeed during the last year there
have been between 1000 and 5000 in
dividual reductions in freight rates. On
some railroads the reductions in rates
have amounted to more than the re-
ductions in wages SO far made. and
on many other railroads the reductions
in wages allowed no net return on op-
erations. but merely provided against
the further accumulation Of a deficit.
Not Sure of Heavier Traffic.
ut has been urged upon the railroads
that a reduction in rates will stimulate
traffic and that increased traffic will
protect the carriers from the loss incl
dent to reduction in rates. The rail-
road arrangements cannot disguise from
themselves that this suggestion is merely
conjectural. and that an adverse result
OF the experiment would be disastrous
not only to the railroads but to the
public whose supreme need Is ade-
quate transportation. Consequently the
railroad arrangements cannot feel tusti-
fed In placing these instrumentalities.
SO essential to the public welfare, at
the hazard of such an experiment based
solely upon sucn conjecture.
"It is evident, however, that existing
transportation charges bear in many
cases a disproportionate relationship to
the prices at which commodities can be
sold in the market, and that existing
yoh ov,I ofh nf
thus imposed upon industry and agri-
culture generally a burden greater than
they should bear. This Is especially true
OF agriculture. The railroad manage
ments are feeling sensitive to and SYM
pathetic with this distressing situation
and dcsire to do everything to assist
in relieving it that IS compatible with
their duty to furnish the transportation
which the public must have.
Union leaders for the most part de-
clined to comment on the announce
ment Of the railroad executives. Presi-
dent Lee Of the trainmen was the one
exception.
Since the union man already have
authorized their leaders to call n
strike" he said, IL don't see how the
roads can have the nerve to suggest
another cut"
MWAeS ANuhI HTcahuGht sAAs
do you think this proposed pay Gu.
will cause the workers to striker one
Of the railroad presidents was asked.
I'm Sick" he replied.
Virtually every railway union OF inn
portance has polled a vote in favor OF
a walkout. Whether this is to be recog-
nized rests with ths officers of the var!-
GUS organizations-princ cipally with tae
brotherhood chiefs.
A ruling which may eventually aggra-
vate the grievance of the railway work-
ers was made by the Railroad labor
Board to-day While deciding that woris
should be paid for on an hourly basis
and recognizing the eight hour day. it
left an opening for the railroads 10
force their point. 1t provided piece
work might be done. IL agreed upon be-
tweer employees and employers. II
was predicted that many disputes would
grow out of this.
Before the railway chiefs made their
announcement some union leaders had
predicted there would be no strike. They
said the strike vote was being polled
merely to give to the union officers an
effective weapon in fighting off further