The Washington herald., 1921-06-01
Each cursed his fate that thus their pro-
ject crossed; how hard their lot who neither
won nor lostHRichard Graves (I7I5-Iso4),
THE Festoon."
Washington Street Railways.
XXXII-FINlS.

TN CLOSING this series OF discussions of the
Il street railway situation The Herald wishes but
Il to emphasize the fairness and desirabiity Of
the suggested solution. AS we promised, our object
has been constructive. All that has been said, has
been but argument leading conclusion. 1t has
been a msrshalling Of facts to warrant that con-
ciusion.
AS the finale, there is but the question,
which is as to the fairness and feasibility of the
plan to combine the two railway properties by them
selves, separating them from the Potomac Electric
which is essentially a district utility As such it
should be monopoly and beyond dispute, no two
monopolies should be combined in owner
ship, be- under single control and manage
ment That is automatic.
1t also complies in letter and spirit with the
anti-merger law, which deliberately enacted to
prevent any such combination To permit the cleo
tric utility become the creature of street rail-
way utility monopoly would be, in effect, waiver
of this law. a direct contradiction OF principle
laid down by congress itself. 1t would in spirit
be violation of the law and make it with
exceptions" Street railway combination opens
the way to give this law the complete effect it
contemplated and which impossible at the
time because it could be retroactive.
Is the plan, then fair to the w. R. & E. stock
holders? 1t is evident that it wipes out all their
street railway holdings 1t is just evident that
a sense II does not DO this. AS matter OF
fact the holders of this stock have always had to
depend upon the Potomac Electric to earn all, or
nc7~Iv all. the dividends they have had from
theii railway stock. AT anything less than the
pres. ut fare the railway cannot earn them a dollar
in dividends
In 1919 the electric utility had to pay them
only all their dividend, but in part the carry
ing charge Of the railway. In 1920 the railway
properties paid only sI56yooo net less than two
per cent the preferred stock alone. They also
face the absolute necessity of large investment
in almost a rebuilding of considerable of their
track mileage 1t is in evidence that the w. R. & E
system is far below efficiency in its upkeep, while
the Capital Traction is close to per cent
Where the w. R. & E. stockholders get the
funds to finance this? Are they ready to supply
il and would they be permitted, if they could to
still further increase capitalization to now make
good depreciation largely consequence of paying
S35ee,ooo as dividends common stock?
Fhey would surrender this w. R & E stock
but-would keep the Potomac Electric stock to
be allotted to them individual nd personal in
stead of a corporation holding. They would get
their what has paid their dividends They
would get stock with assured earning of to o
per cent, wholly freed from the street railway
incubus. Certainly this is a consummation much to
be desired 1t is worth something, too, to be rid of
trouble, OF jangle, of worry and dsrepute
IS II lan 10 tnc NdpUdl traction! Certainly
it is worth much to get the railway MONOPOLY
and rid of competitor who not able to compete
is of public disfavor. 1t is worth much to
please the public by helping solve this endless
dispute and wrangle. Moreover, it would get the
property at price which is conceded the
right to earn eight per cent while Capital Traction
stockholders trained to expect but six per cent
There is not shadow of doubt that the CAPITAL
Traction could sell stock alone to pay the price,
or TO take up the underlying bonds. 1t could, by
savings in salaries, in operation, in traffic police
and taxes, with exemption from paving earn the
eight per cent at the reduced fare. 1t could take
up with stock issues, two-thrds of the underlying
w. R & E. bonds at price which would leave
a sufficient fund for extensive betterments 1t
would then be in clover, financially, capable of
financing any possible future demand through added
capital
We modestly confess we see no flaw in this
If it is accepted, great newspaper and an humble
citizen OF Washington will be much grati6ed, but
only and solely having been permitted to render
service; to assist city. and the capital of our
country.