New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1921-07-23
Congress Gets
Rail Debt Plan
Next Tuesday
Harding Will Submit Fund
ing Proposal i'm Settlement
of All Claims Growing
Out Of Wartime Control
No Increased Tax Burden
Waiver of Demands Based
ON Supposed Inefficiency
of Labor rs One Condition

WASHINGTON, July 22.-president
Harding will send message to Con-
gress next Tuesday setting forth the
agreement reached between the govern
ment and the railroads for funding the
debts of the carriers TO the national
treasury. The Presidents plan will
not involve any further appropriation
by Congress to settle the claims of the
roads against the government.
Settlement of these claims and coun-
ter claims has been pending for
months. In the opinion of government
officials the roads have laid too great
stress upon the losses they incurred by
inefficient labor during the war time
Federal control. The government claims
are based on money spent for equip
ment and upkeep during the war.
Under the agreement which has been
reached the railroads have been asked
by the government to waive their
claims for losses based upon the inef1i
cheney of wartime labor, in an at
tempt to reach settlement, with the
alternative that if they are not salts
fed with the figures arrived at, they
retain the right of carrying the fight
to the courts for settlement.
Congress Must Approve
1t was said at the White House to-
day that the actual recommendations
concerning the form of the adjust
ments must meet with the sanction of
Congress. and it is for this reason that
the President will make recommends
tions to the Congressional committees
dealing with the situation as to the best
methods of adjustment. 1t was an
nounced that the Interstate Commerce
Commission would not take any part
in the adjustment of the claims, but
that the War Finance Corpora ton
might be called upon. The President
has been informed by the managers
of membership organizations of the
railroads that the great majority of
them favor an adjustment based on
the governments plan of waving div
idends based upon inefficient labor.
The President has been sympathetic
toward the claims made by the lines
and has felt that they have not been
treated as fairly as they should have
been. Conferences on the subject have
been going on between the Executive
and railroad representatives ever since
Mr.. Harding entered the White House.
1t was announced that the substance
of the understanding did not consti-
tutc a new arrangement; that all bust
ness with the government is of neces-
sity by contract. The transportation
act sets forth clearly that the roads
shall be recompensed for expenditures
made during the war for maintenance
and equipment. Before entering into
negotiations with the roads with the
view of arriving at an amicable adj
justment of claims, it was felt by the
facilitate the adjustment by attempt
ing a settlement without considering
the claims filed based on the supposed
unfitness and inefficiency of labor.
The President intimated some time
ago that he felt that the companies
were delinquent in filing claims, and it
develops that the hardness was due
in many cases to an impression in rail-
road circles that the Administration
viewed with misgiving the practice of
saddling huge claims on inefficient
labor.
At present there is in the Treasury
$3.50 100000 available to meet claims
and the President feels that the pay
ment of the sum, distributed among
the railroads, would be an excellent
stimulant to business generally. Thus
far approximately sixty roads have
settled their demands on basis of so
per cent.
There are two reasons which stand
out why the Administered ton is anxious
to adjust the claims. The first is to
wind up the affairs of the railroad ad-
ministration, and the second, desire
to give to the roads what is rightfu!ly
theirs.
1t ia believed that a majority of the
companies will accede to the govern
ment's plans. The Administration feels
that a frank understanding will be ar
rived at if the roads put aside their
elaborate claims and present them with
a genuine desire to speed up the settle
ment.
The President has told railroad men
and members of his cabinet that the
vital question, so far as he is concerned.
has to do with how the government can
keep faith with the railroads and OBJ
serve its contract, without asking for
additional funds