Evening journal., 1921-07-26

-ailroads and agriculture. He made /
his request in short message, ad- /
dressed TO the Senate and House of |
representative.
Harding gave only the bare out |
line Of the plan he wants Congress
TO approve. Details are to be given |
out later by the railroad administra-
ton.
The President. however, made
clear these salient points Of his
plan:
That the War Finance Corpora
tion be empowered to buy railway
securities now held by the Director
General, so that officials may have
funds to settle with the railroads
without dipping into the treasury.
That the powers of the corporation
be broadened, so that It can extend
further relief to the livestock raisers
and farmers.
Harding also revealed that to has
ten a settlement with the govern
ment, the railroads have consented
to waive their claims based on the
assertion that labor deprecated in
value during government control and
that the government should pay for
this. The waiver, however will not
prejudice their rights II they should
take their claim to courts.
Harding then explained that the
government owed the railroads and
the roads owed the government and
that settlements have already been
made totaling $225,56S.764
The text Of the Presidents mes
sage follows:
To the Senate and House Of Rep
resentatives:
II is necessary to call the atten-
ton Of Congress TO the obligations
OF the Government to the railroads,
and to ask your cooperation IN or
der to enable the Government to dis
charge these obligations. There is
nothing new about them, but only re-
Gently has there come an understand
ing which seems well to justify a sin
cere endeavor to effect an early set-
tlement. These obligations already
have been recognized by the Con.
gress. in the passage OF the trans.
portation act restoring the railroads
TO their owners. but previous recog
milton was made in the contract un-
der which the railroads were ope'
rated by the Government for the pc
riod Of the World War.
The contract covering operation
provided that the railways should be
returned to their owners in as good
condition as when taken over by the
Z government. and the transportation
act. recognizing that betterments
and additions belong to capital ac-
counts provided that such funds OF
I the railway companies owe the gov
ernment for betterments and new
equipment, added during the perioC
OF government operation might b'
funded. There has been at no tim'
any question about the justice o
funding such Indebtedness to tn
government. Indeed, It has been #
progress TO measurable degre
over since the return OF the rail
roads TO their owners. It has beei
limited. however, to such cases a
those in which final settlement
with the railway administration
have been active.
The process is admittedly too slov
to meet the dihicult situation whicl
the owners OF the railroads hav
been facing, and l believe 1t essentia
to restore railway activities and es
sential to the country's good fortun
to hasten both funding and settle
ment.
Quite apart from the large sur
owing to the government which W
are morally and legally bound
fund, the government admitted
owes the railway companies larg
sums on both accounts such as com
pensation. depreciation and mainter
ance. There has been wide diner
ence in opinion relating TO tn
amount the government owes due i
the main to the claim of the OWL
ers that in spite OF materials an
hours OF labor being estimated
proper relations TO similar expend
ture in the pre-war test period, IN
inefnciency OF labor still left a wild
difference between actual upkee
and the expenditure made during n
government operation.
In order TO expedite settlement an
funding an informal understandin
which is all that is possible or pra
teal. has been reached under whiC
the railway claims based on the iii
efficiency OF labor are to be waive
3 to hasten complete and final settl
. ments, without surrender of an
A rights in court in case there is fai
20 ure to settle. 1t have no doubt tn
n early, final and satisfactory settl
a ments will be reached, since q
policy OF the railway administrati'
a already been effective in final
n settling the accounts OF road fill
e claims amounting to 1925, 5,56S, 76
g resulting in the payment to them
e SOS 141 222.
d The way would now seem to
n clear to very early adjustment al
It relief. except for the fact that Z
d railway administration though pc
10 sessing assets. does not comma
Ie the funds necessary to meet WI
will be it's admitted obligations.
There is no thought TO ask Co
gress for additional funds. P'
haps $500. 600, 900 will be necessai
1 The Railroad Administration has,
4 will have in the progress OF fund.-
ample securities TO meet all
auirements II Congress only v
v grant the authority to negoti'
these securities and provide
= agency for their negotiation.
:, with this end in view you are "a
~ ed to extend the authority OF the "
- Finance Corporation so that it n
I, purchase these railway funding
curities accepted by the Direc
40 General Of Railroads. No added