Five Mile Beach weekly journal., 1922-06-02
Freiuht Rate Cut Which Will
Save People $400, 100000
a Year Is Ordered.
SHOULD REVIVE BUSINESS
No Let-Up in Attack or Attorney Gen
eraI Dauqherty-Bankers Meet in
Paris to Solve international
Loan ProbIem-Commu-
mist Outbreak in
Bulgaria.
BY EDWARD W. PIcKARp

TOR some time President Harding
L has been striving to bring about a
general agreement by the railways OF
the country to reduce freight rates
materially and voluntarily, accepting
the opinion of many experts that low
er rates are essential to the recovery
of business in the United States. He
called a number Of railway executives
to a conference in the White House
and laid the case before them, and
they named a committee of their men,
bership to cooperate with the inter-
tempting to realize the Presidents
wishes. This looked promising until
Mr.. Harding a few days later admitted
that the railway chiefs had so clearly
presented to him the difficulties of the
situation that he vas not very san
guine of success.
Then the interstate commerce COM
mission by itself came to the rescue
and on Wednesday announced a deci-
sion in accordance with which rates
on nearly all classes and commodities
of traffic will be reduced on July 1 by
amounts equal to 10 per cent of their
| present levels. The chief commodities
excluded from the reduction are agri-
cultural products in all sections out
side of New England, live stock and
western grain and grain products.
The order reaffirms the reduction Of
1O.5 per cent in the western hay and
grain rates last fall and the cut of
10 per cent made voluntarily by the
roads on agricultural products, JAN
uary 1.
According to the estimates of ex-
perts, the reductions mean a saving
of approximately S40o, 900, 900 a year
in the rail transportation bills of the
American people. The farmers alone
they say, will benefit to the extent OF
some 1927, 100000 a year on goods that
they buy normally. The cut is eX.
pected to increase buying and thu;
stimulate industry and diminish I'm.
employment. On this there Is general
agreement among manufacturers, mer
cDd1QlScrS anu DdllbSIS.
Many of the rail executives were
not only surprised by the commits
slon's decision, but also quite disgrun
tied. holding that the reduction should
have been postponed until the roads
had accumulated more funds through
increased earnings. Others, however
admitted that the loss in freight rev
enue probably would be more than off
set by increase in traffic.
The interstate commerce commission
included in it's decision the determine
ton of 5.75 per cent as the reasonabl,
annual return for carriers on thei.
capital investment, as compared will
the 6 per cent level previously fixed
The new figure really amounts to
per cent, since the federal corporation
income taxes are subtracted iron
earnings before profits are figured.
Another part Of President Harding
plan was a voluntary acceptance o
a reduction of wages by the railwa,
brotherhoods. At present there is III
tie prospect of this, but the railwa,
labor board is expected to make a de
cision soon on wage questions tina
have been pending before it, the find
ing to be based solely on evidenc
presented in the hearings. 1t is est
mated by the bureau of railway ecc
Monies that railway labor board OF
ders to date are saving the roads $500
100000 a year in reduced wages, S
much Of the freight reduction seem
already to have been unIoaded.