Montgomery County sentinel. [volume] (Rockville, Md.) 1855-1974, 1921-12-23
Kendrick Would Repeal "Protec-
tion" Guarantee To Railroads.

Kendrick Would Repeal "ProteG-
tion" Guarantee To Railroads.
With agriculture prostrate and the pro-
ducer unable to ship his products at
profit, the railroads enjoy a measure of
protection under the present transporta-
tion act, so highly praised by President
Harding. which guarantees them a fixed
income Of from S l-2 to 6 per cent on the
aggregate value of the property.
Senator Kendrick, Democrat. of Wyom-
ing. introduced an amendment to the rail-
road funding bill which would repeal this
provision. saying that to guarantee in
comes to the railroad and not to the pro-
ducers is to assume that transportation is
more essential than production.
He cited many cases to show that the
rates are practically prohibitive under this
guarantee, among them the following:
Mine shipments of hay from different
points in Nebraska to Omaha during the first
part of the present year showed the follow
ing results The selling price was $l2:1l;
the average cost of harvesting was 1851
per ton: commission 81 per ton: freight
S4.87; making total of expense Sl1.52.
The average return to the producer was
only So cents per ton
Concerning reports of livestock ship
ments. Senator Kendrick quoted the fol-
lowing; Among those that appear to me
to be the most convincing was shipment
of 800 head of what are known as Gamer
cows that were sent to the Fort Worth
market. This class of stock sells for the
lowest price and there was long freight
haul the cattle actually netied
to the owner Is cents head. making for
the 800 head $54."
Senator Kendrick also stated that it cost
1881 to ship carload of wool from Boise.
Idaho. TO Boston as against SAT- in 1917.
and that il is cheaper for the Idaho wool
producer to ship to Portland. Oregon. and
there rebill for Boston in order to get the
low rate made to meet water competition
Further he said
The rate on wool in maximum car lots
of $4,000 pounds from Cheynne. Wyo.. to
Boston is $2.06 per hundred. In mini
mum car lots Of 24.00O pounds is Sass
per hundred The water rate from the
Pacific coast ports to Atlantic ports is 80
cents per hundredweight. The rate from
Australia to Atlantic ports is $1.62 per
hundred. Senators will not be slow to
note the significance of these figures. The
wool producer Of the Antipodes can place
his shipment in Boston more cheaply than
the American wool grower can transport
his clip halfway across his own country by
what we have been taught to believe is
the most efficient transportation system
in the world. To state it plainly. the
guaranty clause is, in effect. protective
tariff. not for American but for foreign
wool growers and this at time when
the American producer is enduring the
most severe hardships he has encountered
in generation when our every thought
should be to tighten. not to increase. the
burden he is forced to carry"
After citing the impossible conditions
that govern the agriculturists in trans
portation matters Senator Kendrick said
that lin turning the pages Of a newspaper
published in one of the most prosperous
sections Of the extreme West. under ordi-
nary conditions. noted three solid pages
Of notices advertising farms and ranches
to be sold for taxes"
In comparing price levels with railroad
rates, Senator Kendrick said
According to evidence submitted at the
agricultural inquiry. the average price of
fifteen commodities in August. 1920. at a
time when prices had started to decline.
was IS per cent above the average FIVE
year pre-war level. while freight rates were
only 80 per cent above that level. During
the year that followed this relationship
was completely reversed and, on August
I. 1921. the average price level on these
fifteen firm commodities was 80 per cent
above the five-year pre-war level. while
freight rates were 80 per cent above that
level. Thus with the market price Of farm
products tumbling at an unprecedented
and precipitous speed. the producer was
called upon to pay transportation charge
three times greater than that which he
had paid during the war. II was as
though the producer had been called upon
to pay tax upon his losses. We have
not hesitated to repeal the tax on excess
profits because we have been told that its
effect was to hamper industry. destroy
initiative and induce staenation. We have
reduced surfaces because we have been
told that they drive investment funds out
Of productive industry into tax-exempt
securities. Having acted so promptly for
big business and for wealth. is it possible
that we shall deny to the farmers and
ranchers Of the country even the slight
measure Of relief that would be afforded
by the repeal Of the guaranty clause which,
in effect. Is a tax upon excess losses 2"
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