Grand Forks herald. [volume] (Grand Forks, N.D.) 1916-1955, 1921-05-07
CHARGES MADE
BY JET LAUCK:
ARE DENOUNCED
'
Western Railroad !, Heads
Declare They are Incon-
sistent and Baseless.
Report Says Charges Are
Made Primarily For Prop
aganda Purposes.

Chicago, May THE statements
presented to the railroad labor board
by W. Jett Lauck. consulting econ
omist for the railroad labor unions
charging that large amounts of
money are being wasted in the finan-
cial and operating management OIL
the railroads have no relationship to
the wage question now before the
board, it was contended in a state I
ment Sled before the board today on
behalf or, the western railroads. 1t
was signed by Charles II. Markham,
president, Illinois Central railroad;
Hale Holden. president, Chicago, Bur-
lington & Quincy: II. f. Byram, presi-
dent, Chicago, Milwaukee & St Paul;
W. II. Finley president, Chicago &
Northwestern; ]. E. German, presi-
dent Chicago, Rock Island - Pa
cifjc. and S. Mn FELTON,, president,
Chicago Great Western
Declare 1t Propaganda.
"rhe sole purpose of these state.
ments," the western railroads brief
declared, sis to divert public attention
from matters actually pending before
the board. They are bald propaganda
intended to discredit private manage
ment and promote the Plumb Plan.
We respectfully protest against the
board continuing to allow hearings
before it to be made means OF
spreading this propaganda.
Since these statements have been
permitted to be presented to the
board, we respectfully call your atten-
ton to- the fact that in addition to
being irrelevant, they are gross mis-
representations of railway manage
purpose is to mislead the public re-
garding the actual facts as to both
railway management and railway
regulation" 1t is charged that in
various ways the capitalization of the
railways has been made excessive and
that in this way a burden has been
imposed upon the public. We deny
that the capitalization Of the railways
as a whole is excessive. Even il it
We're this would have no effect upon
passenger and freight rates since the
interstate commerce commission spe-
cifically bases the rates upon a valua-
tion made by the commission itself.
y Deny tHnaactaR Deal.
.,. 1t is.eharged ,thasaa it he saasssaysSsna
concerns from which they buy fuel,
materials, supplies and equipment are
under the same financial control and
that. in consequence. the railways pay
excessive prices to these other con-
Germs. Every railway buys material
from literally hundreds of different
coal, iron and steel, lumber and equip
ment companies all over the country
and the. charge that the railways and
all these concerns are under the same
financial control is sabsurdly untrue.
Gwen if they We're under the same
control this would not prove that the
railways pay excessive prices, and in.
disputable facts regarding almost in.
Vulnerable transactions of the pur.
chasing departments of the railways
could be presented to show that they
do not and have not paid higher
prices than other purchasers of the
same things. Absolutely the onl!
evidence purporting to support. thi:
charge is that the railways paid higf
prices last year for having a YER,
small part of their locomotives .ant
cars repaired in outside plants. An,
fair comparison of the prices ptd fol
these outside repairs and what ii
would have cost to have made then
in railway shops will prove that th'
prices paid to outside plants were no
excessive.
Charge Inconsistency.
1T is charged that the railway
have wasted immense sums by. no
undermining their locomotives. Fig
ures given by Mr.. Lauck himsel
show, however, that improved device
have been installed with remarkable
rapidity on locomotives within the las
ten years. considering the difficultie
the railways have had in raising capi
tai for improvements. Mr.. Lauck'
inconsistency is shown when n
charged the railways have not suh
ciently improved their locomotives an
saws at the same time that they hav
greatly increased their average trac
tive power, and then criticizes then
because they have not fully utilize
this increased tractive power. TIL
best measure Sof the increase In tn
service obtained from locomotives
the average train load. In 1915, thi
was 3sS tons. while in 1920 it was 81
tons, an increase of 81 per cent.
Would Cost Large Sum.
"Mr. I4auck cites other allege
could be remedied only by maxim
great improvements involving the in
vestment Of large amounts. Of ne,
capital. This new capital could b
obtained only If the railways were en-
abled to make enough net operatin
income to pay a return upon it.. Th
railways are trying to increase thei
net operating income by reducin
their excessive operating expenses
within recent months the prices {
everything the railways buy except la
Dor have been reduced.
"Among the items of alleged vast
Mr.. Lauck mentions Is loss and dam
. age. In 1917. the last year befor
government control payments for los
and damage to freight were only $35
- 100000 in 1919. after two years {
government control, this had increa.
ed to $106,S04,O00 or 205 per cen
Mr.. Lauck defends government un
fed control, but wants to point. this
such large saving in this item
possible because It was SO increase
under government control.
1T is claimed that while the mar
agements have been inefficient. tn
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