The labor world., 1922-04-08

CUT IN RA|LRoks WAGES i. !.
Will not Hell P PRODUCER
OR CONSUMER, SAYS EXPERT

Chicago, April 6.-ResuminE his
testimony before the United States
railroad labor. board in the case OF
the proposed wage reduction for
railway employees: Frank J. Warne,
representing the federated. shop
crafts, called attention to certain
phases of the promise made by the
railroads to reduce transportation
rates in case the board reduced
wage rates. He: pointed, out the in
definiteness, OF the railroad corpora
tions'E promise.
In the first place, he said, the rail.
roads had not even made an estim-
ate of the amount Of the proposed
rate reduction they had promised
the public. He said that>a, curious
and interesting phase Of the, situa-
ton developed before this. labor
board during. the hearings Of; March
s. when Mr.. Wharton; inquired OF
Mr., Higgins, representing the west
ern roads. as to the total amount Of
the wage reduction ow.being asked
Of this board and. which question Mr..
Higgins was unable to answer.
The question Mr.. Wharton asked
Mr.. Higgins. was: "Could you give an
estimate as: to. the. amount: of. the
operating expenses are affected by
the reduction in: wages as submitted
by the railroads?" :,%-
Mr.. Higgins replied that ''the rail-
roads did not undertake, as far as !
know. any Of. them, to find out what
the saving would be in dollars and
cents. H..
-. Where Savings Will Go
"And yet," Warne said, "they are
going to turn over these savings out
OF wages. to the shipper in lower
transportation rates. according to
railway Representatives, the bi-
luminous coal and anthracite comp
anies, steel and iron companies
lumber companies. oil companies,
construction comp r<simpiove-
ment companies, water supply comp.
a11ies; power supply companies, and
the scores of other industries owned
by railroad corporations or in which
railway officials are pecuniarily in
terested, bondholders, and stock
holders" ~.
That this is to be the result IS
more, evident than it first appears
as indicated by. the declarations be.
fore the interstate. commerce COM
mission in the pending rate reduc.
ton case. by Fred H. Wood, counsel
for western carriers, that he did not
believe: the consumer: would receive
much, If any, Of the. benefit ola rate
reduction. -. ..:>.. g.
Warne. quoted Mr.. Wood as say.
ing: Furthermore, lnaAifestly il
would not have the effect of stimu.
lating. production unless the effect
in the lower cost Of product ion; were
passed: on to. the: consumer. and
thereby stimulate the demand
through a reduced price. There is
not. only no evidence as to most o'
! these commodities that it would
| have. that effect; but the steel men
said that it would not; have that ef.
fect-they would keep it for: them
selves. And it, must be perfectly ap.
parent that the effect upon the cost
| OF production. is itself so slight that
! no one could say that it would have
the effect Of q stimulated. demand
through a reduced price for the fin
ished product" - -"s .:, ::
- A "Sinister Combination" :;
Warne testified at some. length on
that phase Of the question involving
the promised rate reduction to farm
ers based upon a reduction in the
wages of employees, which promise,
the witness said. had been made by
the railroads at a secret conference
In Washington last December in or
der to secure the farmers support OF
a. wage reductions. He said thi.
secret conference represented a sim
lister combination .of well-defined
groups in society organized. secretly
and for the purpose Of depressing
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