Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1921-05-10
HIGH RUNNING COST
BESETS RAILROADS
Southern Pacific Official Urges
Five Remedies as Senate
Probe Begins
DEFENDS FREIGHT CHARGES
Ry the Associated Press


Washington. May 1O.-Thc trouble
with the railroads is excessive operat-
ing expenses. IAN abnormal amount
Of which is the cost Of labor, Julius
Kruttschnitt. chairman Of the board
of the Southern Pacific Railroad, dc.
clared today before the Senate inter.
state commerce committee. He was the
first witness az the orening of the con
gressional probe into the trnnsporta.
ton situation.
Mr.. Kruttschnitt suggested five
''remedies" which he said were "caSily
applied and productive OF great ccono-
mics. They are:
D. "Stop the use for common carrier
purposes Of highways built with public
moneys, without adequate tolls and
proper regulations
Make inland waterways built or
themselves as to interest on cost and
maintenance BY regulating the common
carrier traffic on them and by imposing
adequate tolls.
Keep the United States Govern
ment out Of the business vt operating
steamships. and stop the ,nviSh rXpcn
diture of puoi" money to provide
coast to. coast ocean transportation in
competition with transcontincntal rail-
roads.
''TollS for use Of the Panama canal
should be sufficient to pay interest on
its cost, operating expenses and main
tenance.
do not deprive transcontinentai car
riers Of coast to. coast traffic by inheS-
ibly enforciae strict long and short o
haul cause.
Freight Rates and Depression
Nc IA ..,k,, 1
statement, which opened with the as.
sertion that freight rates were not re-
sporsibie for business depression.
widespread propaganda is being
carried on TO arouse public sentiment
sgainst existing freight rates. he said
THE fact Is that even since fhe rates
have been advanced the cost Of trans
porting commodities IS far less than the
toll taken bv the commission merchant
and the retailer.
Mr.. KruttSrhmitt had not concluded
his prepared statement when the com.
mittee adjourned until tomorrow.
In opening the session Chairman
Cummins read a summary Of railroaC
revenues each year. but operating ex.
penditureS rising at an even SwitteI
rate The tendency eliminated, he said
when In the year ended March !, 1927
the roads received S6.lT5 9G2 OUO TO
transportation services and spent 50.
S25 .3SS. 80 in OIrrating expenses. Afte
deducting taxation and rental charges
Senator Cummius said. the carriers har
net return from investment of onl!
$4,000 900,
Revenues and Expenditures
81 think il is apparent that revenue
can never be increased from highe
rates" senator CumminS said. IF W
cannot raise the railroad revenues. tn
problem before u is that of asCertainin
whether these railroads revenues ar
efficiently and properly expended. Th
gravity Of the situation before tn
American people Is plain II the trans
pOrtstion industry Of our country ha
become permanently an unproftabl
business.
The chairman said he presented hi
statistics for tho year ended March
because that was the first year Of pri
vhte operation after government con
troll.
"That's scarcely true" said Senate
Kellogg. For the first six month
Of that year railroad operating expense
were fixed by statute. That isn't pri
vate control.
The committee discussed it's polio
toward witnesses and Senator Town
send, Of Michigan, demanded that "a
witnesses here be- sworn; we've hear
too many contradictions Chairma
Cummins remarked that applying tn
oath tn witnesses was not tho usui
custom, but Mr.. KrnttSchnitt wa
sworn.