The Rock Island Argus and daily union. (Rock Island, Ill.) 1920-1923, 1921-07-11
F. H. GOFF, CLEVELAND BANKER,
SELECTED BY PRESIDENT HARDING
FOR JOB OF BREAKING RAIL JAM
BY II. B. HUNT.

Washington, July 1.-THE job of
breaking the railroad logjam, in an
effort to clear the nations distribu-
ton channels for normal resump-
ton of business and industry, has
been delegated by President Hard
ing to Fred II. Golf of Cleveland.
Although Goff's Iabors will be en-
tirely unofficial, his assignment to
the job with the knowledge and ap-
prevail of Secretaries Hoover and
Mellon and much of his work will
be in cooperation with these two
cabinet heads.
In reality Goff's job is that of a
mediator. He must find some com
mon ground on which the govern
ment and the railroad executives
can agree in respect to claims arts
ing out of the period of federal rail
way operation. He has no power to
coerce, but full power to negotiate.
Goff's selection as mediator in the
railway settlement, representing the
president, was the result of the
forceful and thorough going way in
which, at the recent White house
dinner to western bankers, he pic
effect a settlement with the roads as
the biggest single barrier to a revi-
val of business. His presentation
of the case so impressed Harding
that he was asked to undertake the
Fastening of a settlement through
negotiations with the director gem
eral of railways, the Interstate COM
merce commission and the execu-
tivcs of the various roads.
Hoover, as adviser in commercial
conditions affected by any settle
ment, and Mellon as adviser in nee
essary funding and financing, were
directed to cooperate with Golf.
The size of the job ahead of this
63-year-old Cleveland banker may
be understood when it is realized
that disputed claims amounting to
more than a billion dollars must be
composed before a settlement can bd
reached.
The government has claims
against the roads for $774.5S7 900
spent during the period of federal
control for new trackage, termin-
ais and equipment. This sum rep
resents new capital, which the gov
eminent has contended should be
used as an offset to what the gov
eminent owes the roads for rental
and guarantees.
The railroads contend the gov
eminent owes them, on account of
rentals, guarantees, undermainten-
ance, etc, between $1,200,000, 900
81 500, 100000.
The roads maintain they cannot
now finance, by new issues Of stock,
the three-quarterS of billion ow-
ing the government on capital &C
count, and that the deduction of that
sum from the governments pay
ments is equivalent to attempting to
meet these heavy new capital
charges out OF current earnings.
On the other hand, the director
general of railroads, James c. Davis,
contends that the roads in present.
ing their bills for final settlement
have padded them with hundreds of
millions in claims that cannot be
supported. In settlement with
about so class one roads, the
amount paid was only about 40 per
cent of the amount originally
claimed as due. Specifically, "A
roads filed claims OF $96.S2I,S0I,
but accepted in settlement s42,2S6,-
914, or 43.6 per cent of the amount.
Settlement is still pending, how
ever, with about 100 class one roads,
and some 200 short line and terminal
roads.
To Fund Investment.
One of the first things Golf win
recommend for the relief of the
railroad situation will be the fund
ing, for a period of ten years. of the
S774, 200, 900 capital investment made
by the government in the roads.
. This would relieve the roads of
the necessity of hunting for private
capital 10 cover this investment. and
would mean that the total of unpaid
rentals and guarantees owing the
roads would be paid. This. he de-
clares, would give the roads cash
with which to meet outstanding
bills, to get busy improving run
Town road beds and repairing de-
ective equipment. 1t would start
steel mills and railroad supply
shops, give an upward impetus to
and set the whole in
ustrial machine moving as no other
Jingle force could.
A second step, in Goff's negotia-
tons will be TO induce railroad ex-