The labor world. [volume] (Duluth, Minn.) 1896-current, 1922-05-06

Under the terms of. the Cummins.
Esch transportation bill, providing
Tor the termination of federal con-
troll of railroads and their return
10 private management, the carriers
were guaranteed for period of six
months a proportionate amount of
the rental paid them while thew
were being operated by the gov
ernment... which aggregated $780,
100000 annually.
IN other words, the owners were
to be compensated out of the fed
! eral treasury for any losses that
might be sustained in the opera
ton. and in addition were to- he
paid as profit s453,oo0,o0o
That railroad managen3ents took
advantage of this guaranty to make
raids upon the federal treasury is
susceptible to easy proof. -
During the six months while the
government. was OverWriting rail-
road operating costs the MANAGE
ments INDUCED in a veritable orgy
or extravagant and wasteful ex-
pendltures and grating.
AOSL 10 Government.
The exact sum lost to the govern
ment has not been ascertained. and
perhaps never will be known. In a.
statement filed with the Interstate
Commerce Commission in April.
l92O, William H. Johnston, president
OF the International Association of
Mach1nists, complained that the
raliroads had robbed the govern
ment of approximately $4,000, 900
through the manipulation of car and
locomotive repair contracts alone.
rms charge was made the basis
of an investigation by the Interstate
Commerce Commission, which sub
stantlated Mr.. Johnston's charges 80
far as the Pennsylvania the New
York Central, The Atlantic Coast
Line, the Chicago, Milwaukee and
st. Paul, the Chicago, BURLINGTON
and Quincy and the Chicago and
Northwestern Railroads, the only
roads investigated, are concerned.
Officials of these roads, testifying
before the Interstate Commerce
Commission, admitted. that they had
PAID the Baldwin and other con-
Germs for making. locomotive re-
pairs as much as six times what the
work would have cost had it been
performed. in the companies own
wel1-equtpped shops.
While these contracts were being
diverted to private concerns. in
which railroad officials have a di-
rect financial interest. employees of
the railroads were being DISCHARGED
by the thousand
1t is also in evidence that the
motive power of the six railroads
involved. in these extravagant con-
| tracts was in better condition than
it had been for years.
Exploited Guaranty.
The plain inference of these
transactions is that railroad. officials
were taking advantage. Of the gem
erous guaranty provision of the
Cummins- Esch- bill to make big
profits for themselves and the pri-
vate companies with (which they
were affiliated.
II there is any doubt as to what
was in the minds Of railroad man
| ayers. it is effectively. : removed by
letter. written by We. E.. Besler,
president Of the, Jersey Central
Railroad, to C. E. Chambers, SUPER
intendent of the motive power and
equipment of that corporation, In
which Mr.. Besler insisted that bills
for repairs being made by Baldwin's
shall be rendered: before the expira-
ton. of the. guarantee period. The
letter says:
Your letter of March 81, with
| reference to IS engines to Baldwin's
and IS to the American Locomoti
all of which is approved, and I hope
you will have the work pushed to
the very limit in the matter of early
completion, so we may have bill
within the shortest possible time
certainly before September 1, at
which time the guarantee period
expires. Please have: the locomo-
tive companies understand that time
is the essence of this entire matter,
Tor reasons. above Indicated"
Exposes Wholesale Graft.
In April, 1921, following the COM
plant of Wholesale grating by Mr..
Johnston, the Interstate Commerce
| Commission directed a questionable
a number Of railroads covering car
| and locomo olive contracts.
The replies to these questionnaires
were uniformly to the effect that a
number of railroads had made ex-
travagant contracts with private
| concerns.
The Pennsylvania admitted that it
had sent 200 locomotives to the
Baldwin Locomo olive: Works.
The average cost Of making class