The Telegraph-courier. [volume] (Kenosha, Wis.) 1888-1946, 1922-11-30
CUMMINs ON FREIGHT RATES.

Just about a month ago, speaking at Des
Ioines, Iowa, Senator Cummins, Chairman OF
he Interstate Commerce Committee, explained
in detail the provisions and operation of the
Transportation Act and asserted that such Act
is in no way responsible for high freight rates
In the month that has elapsed since that adj
dress was delivered and widely published, nc
one has undertaken to controvert it's state.
ments
In his address, Senator Cummins outlined
those provisions of the Act which relate to the
fixing of freight rates. Among those provi
sions were sections which required that the
Interstate Commerce Commission. in the exer.
else of its power to prescribe just and reason.
able rates, may from time to time establish
rates so that the carriers as whole or in rate
territories, will, under honest, efficient and
economical management, and reasonable ex.
penditures for maintenance of>way, structures
and equipment, earn an aggregate annual net
railway operating income equal as nearly as
may be, to fair return upon the aggregate
value of the railway property of such carriers
held for and used in the service of transporta-
Rtion, Another provision required that during
THE two years beginning March 1, 1920 the
aCommission shall take as such fair return a sum
equal to five and a half per centum of such
aggregate value but may in its discretion ado
.thereto a sum not exceeding one-half of one
Epercentum to make provision in whole or in
part for improvements, betterments or equip
iment.
Those are the provisions of the Transports.
ltion Act which have been charged with being
the cause of high freight rates.
The Constitution of the United States de.
clares that private property shall not be con-
fiscated. The courts have construed that provi-
sion of the Constitution to prohibit any gov
ernmental limitations which prevent the own
er of property from receiving just and rea-
sonable return thereon. Even if the Constitu.
ton had not thus safeguarded rights of proper.
ty every man will admit that to impose Legal
restriction which prevents reasonable return
on property amounts to confiscation.
We do not recollect that any one has asserted
that rate of five and a half or six per cent is
unreasonaby high In fact, there has been nc
occasion for any one to raise such Ia question
for the records of the Interstate Commerce
Commission show that the highest annual rate
of return since the Transportation Act was
passed, amounts to only an average of 3.3 per
cent on the property used in railroad transpor-
itation.
When all these facts are taken into consider
alton it is readily apparent that no one can
controvert, as no one has attempted to con-
trovert, the statement made by Senator Cum
minis that the Transportation Act is not re-
sponsible for high freight rates. Since the
roads are entitled to reasonable return, and
1.-THE present freight rates are yielding only 3.3
per cent, and 3.3 per cent is less than reason
able return, then it necessarily follows that the
law which fixed the standard upon which rates
shall be based is not responsible for high rates
1t is safe to assert that certain newly elected
and reputedly radical members of Congress
who promised to urge the repeal of the Trans
Iportation Act, will not undertake specifically
to demonstrate that high freight rates are
caused by the Transportation Act. In a 90.
litical campaign they were able to make votes
by denouncing high freight rates and the Trans
portation Act in the same breath A definite
and specific analysis of the provisions of the
law and the income Of the railroads will not
support their campaign assertions The fact of
the matter is that high freight rates are due to
the high cost of operation and to no oSner cause.
EASY PICKING.