The Washington herald., 1922-11-27
Money and Trade
Railroads Starving.
Our Facilities.
Have Declined.
Lesson Derived.
b. GEORGE w. HTNMAN.

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United States 10 being starved and
strangIed. With all its growing
population and increasing needs. the
United States has fewer miles Of
railroad track to carry the peoples
goods. fewer engines to haul them.
and fewer cars to contain them than
five years ago.
Why? II q man had to give one
dragnet reason he would say: Lack
of money. Why lack of money? Be.
cause people with money do not in.
vest 1t as formerly in railroad
securities and SO provide the means
with which new tracks. engines and
cars can be built to convey the
traffic.
But why do the people with money
turn away from the 'ailroads when
they come to investments? Because
there 10 no proper incentive, no
profitable inducement to invest the
money In railroads.
RAILROAD EARNINGS.
Today railroads earn barely 4 per
cent and practically are not allowed
to pay more than 6 per cent to In.
vestors. And this country Of ours,
with its resources hardly scratched
in the west and but half developed
in the east, Ia not a I per cent or Q 6
per cent country.
All sentimental ponsense aside.
men invest money to make money.
The most destructive delusion to-
day is that men will 60 into busi-
ness either by purchasing stock or
taking the management in an in
dustrial enterprise. for any other
purpose than to make money.
Making money-that IL what the
professors call the business man =
incentive. That is the inducement
that makes him invest. And the
better the prospect of making
money, the more he will invest. II
is because railroad investors have
been deprived largely Of this in.
centive that the railroads starve
and will continue to starve until
the laws governing railroad profits
are reversed or the Government
takes the railroads into its own
hands.
Without that incentive, all busi.
ness would drop to the present
level Of the railroads and even
lower.
These business truths apply to all
the world. No incentive. no busi-
ness. That ia the way IL goes.
A new book on Russia has a chapter
to show how the lack of incentive
among the Russian farmers led to
famine. The Government con.
scripted the farmers surplus crops;
the farmer, therefore, quit raising
surplus crops. The acreage devoted
to food-growing dropped in five
years from 220.e00, GOO acres to 40..
600 900. and Russia. which formerly
had helped feed all Europe. did not
grow enough for her own people.
SITUATION IN GERMANY.
In Germany, we read in Satur.
days newspaper, the government
cannot get from the farmers the
grain needed to feed the people
Why? Because the farmers are
discontented with the requisition
laws" This means that the farm.
ers cannot get money enough to
induce them to raise and turn over
their crops. The money incentive
is lacking.
The sure way to kill enterprise
in trade. industry. or agriculture, Is
to kill the incentive, that is, the
opportunity to make tmoney The
usual way to reduce enterprise in
trade. industry, and agriculture Is
to limit opportunity or to take
away an undue share of the money
after 1t has been made. And right
here. one cones back to conditions
IN this country.
U. s REFORM METHODS,
There are all sorts Of schemes to
reform and uplift business in the
United States. There is much to
reform and uplift-nobody doubts
it. But
When reforming and uplifting are
carried so far as to impair the in.
centive or inducement. when high
wages and high profits are rem.
dered impossible at one and the
same time, when the incomes from
business and business investment
are decimated by taxes, when the
ity of an enterprise are attacked,
there and Their will be recorded the
end Of the business progress Of the
nation. The incentive once gone,
or impaired the wealth Of the peo.
pie and the comfort of the workers
from the employer down to the un.
skilled laborer will cease to ad.
vance at best. and at worst will
sink back to the standards of the
past.
The lesson Of all this for the ma.
tion's business Is so plain that II
seems a, waste of space to state or
| explain it. And 1t would not be
stated and explained here il II
We're not that every day men who
should know better. men who are
neither fools nor fanatics. insist on
Ignoring it. and, sometimes even or
denying it. g..
Fire Destroys Export