The Chesterfield advertiser. [volume] (Chesterfield C.H., S.C.) 1884-1978, 1921-10-27
RAILROAD PLAN To
GET RATES down
Propose to Reduce Wages anG
Return All the Saving by
Reduction in Charges.
FULL TEXT OF THE PROPOSAL
Statement by Thomas Dewitt cuyler,
Chairman Of tho Association of
Railway Executives on tho
Situation.

neariy ail tne leadlnB railroads in the
country. Mr.. Thomas Dewitt Cuyler,
chairman OF the Association OF haii
way Executives, made the following
statement:
| At meeting of the Association of
! Railway Executives today It was de.
termfned by the railroads of the
United States to seek to bring about
I reduction in rates. And as a means
to that end to seek a reduction in the
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 10
per cent? apd for reduction in the
wages, OF all other classes of rail
road labor to the going rate for such
labor in several territories where the
carriers operate
TO Reduce Rates as Wages Go Down.
| understanding that concurrently with
such reduction in wages the benefit
OF the reduction thus obtained shall
with the concurrence Of the Inter.
state Commerce Commission, be pass
ed 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 upon this
course in view Of their realization of
the fact that the wheels of industrial
activity have been closed down to
point which brings depression and dis
tress to the entire public and that
something must be done to start them
again In operation.
The situation which eonfronts tn
railroads is extremely critical. Th.
railroads in 1920 realized a net rail
! way operating income or about S62
! 100000 upon property investment O.
over $1s,0GG,GGG, Gee and even thi
amount Of $62,0O0,000 included bac!
mail pay for prior years received from
the government Of approximate,
$64.000,000. thus showing, when the
sidered, an actual deficit before max
Ing any allowance for either interes,
or dividends.
The year ended in serious depres.
sion In all branches Of industry and
In marked reduction Of the market de.
mand for and the prices of basic com
modities, resulting In q very serious
falling on In the volume of traffic.
Roads Forced to Defer Maintenance
In this situation. a policy Of thu
most rigid economy and of postpon.
ing and cutting to the bone of the up
keep of the properties was adopted
py the railroads. This was at the
price or neSlecting anu fo. tie time
deferring work which must hereafte
and in the near future be done anf
paid for. This is illustrated by th
TACT that, as Of September .15, 1927
over 16 per cent, or 374.431 In nun
ber, OF the freight cars Of the carrier
were In bad order and needing re
pairs, as against a normal Of bad or
der OF not more than l60 900 as Is
further illustrated by the deferred
and inadequate maintenance OF othe.
equipment and of roadway and struc
lures,
Even under those conditions, anf
with this large bill charged III
against the future-which must soon
be provided for and paid II the car
r1ers are to, perform successfully
their transportation duties-the re
silt or operations for the irst eigh
months OF this year, the latest avail
able figures, has been at a rate of me-
railway operating income, before pro
viding for interest or dividend
amounting to only 2.8 per cent pc
annum on the valuation of the car
rier properties made by the Inter
state Commerce Commission in the
recent rate case, an amount not suf
hcient to pay the interest on thei.
outstanding bonds.
Roads Earning Far Below Reasonaolc
Returns.
Ii fs manifest, from this showing
that the rate OF return OF 5h or {
per cent for the first two years afte
March l, 1920, fixed in the Transpor
tation Act as a minimum reasonabl
return upon railroad Investment, ha
not been even approximated mucl
less reached; and that the presen
high rates accordingly are not due t,
any statutory guarantee OF earnings
Tor there is no such guarantee.
In analyzing the expenses which
nave largely brought about this sit
uation, 1t becomes evident that b
FAR the largest contributing cause 1
the labor cost.
Today the railroads pay out to la
Lor approximately 60 cents on the dol
lar they receive for transportation
services whereas in 1910. 20 cents ON
the oolIar went to labor