The united opinion. [volume] (Bradford, Vt.) 1881-1970, 1921-11-18
Propose to Reduce Wages and
Return All the Saving by
Reduction in Charges.
FULLTEXT OF THE PROPOSAL
Statement by Thomas de Witt Cuyler,
Chairman Of the Association of
Railway Executives on
the Situation.

country, Mr.. Thomas de Witt Guy,
Ter, Chairman of the Association OF
Railway Executives, made the follow.
ing statement:
At a meeting of the Association of
Railway Executives today, it was de-
termined by the railroads of the Uni
ted States, to seek to bring about a
reduction in rates, and as means to
that end to seek reduction in present
railroad wages which have compelled
maintenance of the present rates.
An application will be made imme-
diately to the United States Railroad
Labor Board for a reduction in wages
of train service employees sufficient to
remove the remainder of the increases
made by the Labor Boards decision Of
July 20, 1920 (which would involve
further reduction of approximately ten
per cent, and for reduction in the
wages of all other classes of railroad
labor to the going rate for such labor
in several territories where the car
riers operate.
To Reduce Rates as Wages Go Down
The foregoing action is upon the I'M
derstanding that concurrently with
such reduction in wages the benefit of
the reduction thus obtained shall, with
the concurrence of the Interstate Com
merce Commission, be passed on to
the public in the reduction of existing
railroad rates, except in so far as this
reduction shall have been made in the
meantime.
The arrangements have decided up
on this course in view of their real
ization of the fact that the wheels of
industrial activity have been slowed
down to a point which brings depres-
sion and distress to the entire public,
and that something must be done to
start them again in operation.
The situation which confronts the
railroads is extremely critical. The
railroads in 1920 realized a net rail-
way operating income of about &c.,,
100000, upon property investment
Of over SIS, 1000, 900, and even this
of 62 millions included back
mail pay for prior years received from
the government of approximately $64,-
100000, thus showing, when the opera
tons of that year alone are considered
an actual deficit before making any
allowance for either interest or divi-
bends.
The year ended in serious depres-
sion in all branches of industry, and
in marked reduction of the market de-
nand for and the prices of basic COM
resulting in a very serious
falling off in the volume of traffic.
Roads Forced to Defer Maintenance
Work
In this situation a policy of the most |
'igid economy and of postponing and !
;utting to the bone the upkeep of the |
properties was adopted by the rail
'oads. This was at the price Of ne |
ylecting and for the time deferTing |
work which must hereafter and in the |
lear future be done and paid for. This |
S illustrated by the fact that, as of |
September Is, 1921, over 16 per cent
IT 374, 431 in number, of the freight
.ars of the carriers were in bad order
md needing repairs, as against nor
nal of bad order cars OF not more
han 100000, as is further illustrated
~ NAb utAtAA th anu AAadCAudlt
enance of other equipment and of
oadway and structures.
Even under those conditions, and
With this large bill charged up against
he FUTURE which must soon be pro-
-ided for and paid If the carriers are
o perform successfully their transpor
alton duties,-the result Of operations
or the first eight months of this year,
he latest available figures, has been
t a rate Of net railway operating in.
ONE, before providing for interest or
ividends, amounting to only 90 per
ent, per annum on the valuation Of
he carrier properties made by the
Interstate Commerce Commission in
he recent rate case, an amount not
efficient to pay the interest on their
bonds.
roads Earnings Far Below Reason.
able Return
II is manifest, from this showing.
hat the rate Of return OF 81 or per
ent for the first two years after
larch /, 1920, fixed in the Transporta-
lon Act as a minimum reasonable re-
urn upon railroad investment. has
W bteA even applOAiAldAeu much
sss reached; and that the present
Ugh rates accordingly are not due to
ny statutory guarantee Of earnings,
Dr. there is no such guarantee.
In analyZing the expenses which
ave largely brought about this sit
alton. II becomes evident that by far
be largest contributing cause is the
lbOr cost.
Today the railroads pay out to labor
Coo on the dollar they
eceive for transportation services,
-hereas in 1916, 4Oc on the dollar
ent to labor
On the first day OF January. 1917.
hen the government took charge OF
ages through the Adamson Act, the
Dor cost o. the railroads had not
gceeded the sum OF about s1.46S. OOO.-
Do annually. In 1920, when govern
entsl authority made the last wage
lcrease. the labor cost Of the rail /
,ads was about e9s.000.0O0 annual |
/. OF. II continued throughout the .