Twin city review. [volume] (Champaign, Ill.) 19??-1929, 1922-01-20
WATERING OF
RAILROAD STOCK
IS BURDENSOME
fBy CHARLES N. KELLEY


At the present market value of all
stocks and bonds outstanding in the
hands of the public, the railroads OF
the nation could be purchased for
SIG, $40, 0OO, 900, Glen Z. Plumb, eoun-
sci for organized railroad employees,
points out in a letter 10 {. II. Mark
ham, president Of the Illinois Central
railroad.
This, Mr.. Plum says, is just about
half the property value claimed by
the carriers, and more than $4,000
0O0,000 less than the value given the
roads by the Interstate Commerce
Commission for ratemaking pur-
poses.
This heavy watering of railroads
imposes an unjust and unnecessary
burden of nearly half billion dollars
upon the American public. 1t also ex-
plains why the farmers of the nation
are broke and why railroad workers
are being ground down as respects
both wages and decent working condi-
tons.
1t also provides a reason for the IN
satisfactory industrial conditions IN
this country. The railroads have es-
tablished charges greater than the
traffic can bear. They have made 1t
cheaper to burn corn than to purchase
coal. They have forced farmers TO
sell the products of a years labor for
less than the cost of carrying them to
market.
In other words, railroad manage
ment and the latter's manipulation
have so loaded down trade with trans
portation charges that it cannot move
freely. This is the implication Of
Mr.. Plumb's letter to Mr.. Markham.
Some time ago Mr.. Plumb testified
before the House Committee on In
terstate commerce on the subject of
railroad valuation. He quoted sta
tistics compiled by the Interstate
Commission as proof of his conten-
ton that the effort of the carriers to
collect toll on watered stock has ruin
ed all sections of the people. If the
roads were permitted to earn return
only on the actual value of their pro-
perty, Mr.. Plumb said, there would be
an immediate improvement in business
conditions. 1t would not then be nee
essary and ask workers to accept star
walton wages. Millions of men who
have been idle for months would re-
turn to work, for when the incubus of
destructive rates is once removed
from commerce it will get to its feet
and start moving.
Mr.. Markham takes exceptions to
these statements, claiming that rep
resentatives of the workers were at
tempting to discredit railroad man.
ayers in the eyes of their employees.
He called upon the employees of the
Illinois Central to repudiate their
their faith in managers, who would,
Markham said, be very happy to re
cord this note of confidence in their
good purpose.
Reiterating in his reply to Mr..
Markham his charge that valuations
so far established by the engineers
of the Interstate Commerce Commits
sion show that the roads are worth
less than half the sum claimed, Mr..
Plumb proceeded to give the market
Value of stocks and bonds, which sub
stantiate the appraisement of the
Commission and support Plumb's
abatement in every particular.
Mr.. Plumb further declared that
charges that railroads are profiteer-
ing through contracts at excessive
pgices with supply companies in
which railway managers are finan-
cially interested, that they are violat-
ing the law by granting rebates and
giving favored shippers free transpor-
tation, and that they are looting the
roads by approving false claims for
loss and damages, have been abund-
antly proven by the Interstate Com
merce Commission, whose findings on
these unlawful practices have been
laid before the Senate by representa-
tives of organized rail workers.
Railroads in more than 126 cases,
involving 2,175 counts, declares Mr..
Plumb, have been convicted of rebat-
ing and have been assessed fines of
more than a million dollars. He de-
clares that claims for loss and dam
ages have increased from a little less
than $20,000,000 in 1910 to more than
$122 900 100000 in 1920, sufficiently
demonstrating, Mr.. Plumb adds, the
truth of charges that railway man
ayers are employing new method
of favoring big shippers at the ex-
pense of the public.
AS to the charge that rail managers
are grating on supply contracts,
is mountain of evidence in the rec
ords of the Commission to the effect
that a number of roads contracted for
repairs of cars and locomotives and
paid concerns in which railroad Off
Gals are interested from four to six
times what the work rendered was
worth.
In view of these facts, Mr.. Plumb
assures Mr.. Markham, railroad work
srs will continue to trust their leaders
and distrust their bosses. The latter
by their records arecondemned as dis
loyal to the public and unjust and ar
bitrary in their treatment of en-
Moves