The central record. (Lancaster, Ky.) 18??-current, 1921-05-19
GIVES REASONS
FOR DEPRESSION
Rail Chief Declares Freight
Charges Not the Cause
OF Stagnation.
FARM PRODUCTS ARE CITED
Business Depression and Lack Of
Demand the Real Trouble.

Washington, n. C-In testIfylnc he
i fore 'hc senate Committee on Inter
state Commerce. which Is conducting
an Inquiry into the railroad situation
i Julius kruttschuifi. chairman ~ thr
board ~ the Southern Pacific com
/ pany went Into great detail ~ 10 the
eject ~ freight rates on produce ship
\ ments foreign and domestic The
main points be- made In this part -
his Testimony were:
| Firs;-That business depression Is
no, the result OF high Ere Oh, rates.
| seeond-That the real cause ef stag.
nation IN produce shipments Is lack
OF market or proftsering.
He said In part:
| A widespread propn gunda e. being
~rried on to arouse public sentiment
against existing freight rates whereas
the fact 4 that even since the rate
have been advanced the cost % trans
| porting commodities j. fnr less than
the toll taken by the commission met.
chant aud the retailer for buying and
selling them.
Public hisled as TO Situation
People are mlsled and conclude that
hlgh rates have stopped the movement
81 n large amount 81 freight and that
the railways would make more money
~ they would reduce the rates and
thereby revive the traffic.
There Is the strongest reason 10 he
lie,c that the very great reduction In
| traffic has been due almost entirely 20
general business conditions that ARE
world wide In thely effect. and that
| would have curne II there had been no
advance In freight rates
1 Prices OF commodities reached their
maximum in the first half Of the year
ig2O aud thereafter fell with great
rap.iiiy In France. the United states
aud the United Kingdom The fall In
the United States began IN May. and
was rapidly on It's way downgrade IN
September, when the advanced rates
took esSrt Nevertheless traffic did
not drop for nj least four months
slump No, Caused by Higher Rates
II was a general dehation and fall
IN prices from the heights to which
they had been driven 10y war cOudi-
tions that has caused stagnation "
business throughout the world
That Il l. not caused by the cost ~
transportation il conyinclngly shown
by the fact that stoppage ~ buying
has caused an oyersupply of ships
hence ocean tonnas. rates have been
recently al the lowest points In their
history.
Notwithstanding these low rates,
ocean traffic shows as great stagna.
ton as rail traffic. aud millions II tons
90 shipping here and abroad are rust
Ing away IN idleness Many commodi.
tiles would not move even " the freight
charges On them were abolished en-.
ilrely. becauA producers eau lind no
market.
That the decline In business Is not
due 90 ppihibltlvc freight rates IL
shown by the following examples:
In January of this year the total
tonnage OF lines west % ~ pasD aud
ogden operated by tho southern Pa
che Company EEL IN u per sent
nage In Arizona and Nevada declined
50 per cent although no increase IN
the intrastate freight rates la those
States has been yet authorized
or made effective. This decrease. en-
hraced srsin, hay and livestock, az
well as ores and other commodities
COTTON UNsNtpPEO FON LACK
OF MARKETS
of Texas cotton crop 81 over four
million bales. 10 per cent remains un-
marketed. Tins average cost of raH
ara water shipment from producing
point TO Liserpsol nae been reduced
4 about si2s per 100 pounds, In the
face Of which about one half million
i bales % cotton less than normal have
been exported 20 Liverpool OBVIOUSLY
the freight rate IL not responsible for
u the restricted movement
II During september, october. and
u November 1890. tS per cent less rice
n So per cent less canned salmon and
II u per cent less dried fruit were sx-
II ported than during the same months
% the previous year, although tho
II reouetion In ocean rates VAS SUB.
stantiaily more than the Increase In
II Inland raft rates. 81 that the material
decline IN the exports Of these COM
n uodities was In the face % a less ar
create cost % transportation.
The Case Of the Fruit Growers