Every evening, Wilmington daily commercial., 1921-07-26
HARDING UNFOLOS
/ PLAN FOR PAYMENT
| OF THE RAILROADS
IN Message to Congress He
Asks Extension Of War Cor
poration's Powers.
NO ADDED TAX BURDEN


Washington. July 26.--Presiden
Harding. in a special message 70 Con-
gress today, asked II To extend the
authority OF the War Finance Cor
poration 10 purchase securities prob
ably up to $500. 900 900 now in the
hands OF the railroad administration
so that the proceeds may be used for
settlements with the railways
This. the president told Congress
would open the way to early adjust
ment and relief" of the railroad prob
lem. There was no thought he said
Of asking Congress for additional
money.
Railway claims. based on the ''in-
efficiency OF labor during the war.
the president said. were TO be waived
for the present to hasten settlement
without surrender Of any rights IN
court. Although the railways owe the
government large surns. the presi-
dent said, the government also owed
the railroads large sums on various
accounts.
mo added expense said the presi-
dent, explaining his request, no added
investment is required on the part Of
the government. there is no added
liability, no added tax burden"
If is merely the grant Of authority
necessary To enable a most useful and
efficient government agency TO use its
available funds to purchase securities
for which congress already has
authorized the issue. and turn them
INTO channels Of finance ready to float
thern.-
THE contract covering operation
provided that the railways should be
returned TO their owners in as good
condition as when taken over by the
government, and the transportation
act, recognizing that betterfnents and
additions belong to capital account,
provided that such gums as the rail-
way companies owed the government
for betterments and new equipment,
added during the period of govern
ment operation might be refunded.
There has been. at no time, any
question about the iustice of funding
such Indebtedness to the government
Indeed. IL has been in progress To a
measurable degree ever since the re-
turn OF the railroads to their owners.
1t has been limited, however, to such
cases as those in which final settle
ments with the railway administra
ton have been effected The process
Is admittedly too slow to meet the
dificuit situation which the owners OF
the railroads have been facing. and /
believe il essential to restore railway
activities and essential to the coun-
try's good fortune TO hasten both
funding and settlement
Quite apart from the large sums
owing 10 the government, which we
are morally and legally bound to fund.
the government admittedly owes the
railway companies large sums on vari-
Gus accounts such as compensation.
depreciation and maintenance.
THE way now would seem to be
clear for very early adjustment and
relief except for the fact that the rail-
way administration, though possess
ing assets, does not command the
funds necessary TO meet what will be
it's admitted obligations.
There IS no tfIought TO ask Con
gress for additional funds. Perhaps
five hundred million dollars VIII be
necessary. The railroad administra-
ton has, or viii have in the progress
/ OF funding, ample securities TO meet
all requirements If Congress only viii
grant the authority TO negotiate these
securities and provide the agency foI
their negotiation.
With this end in view you are
asked to extend the authority of the
war finance corporation 50 that it may
purchase these railway funding Sc
curities accepted by the director gen
eral of railroads. No added expense
no added investment Is required on tn,
part of the government, there is nc
added liability. no added tax burden
Il is merely the grant of authority
necessary 10 enable a most useful ane
efficient government agency TO use is
available funds to purchase securi-
ties for which Congress already has
authorized the issue, and turn then
into the channels OF finance ready
tc flow them.
Continued on page s.