The Washington times., 1922-03-24
Excess Profits Tax On
Street RaiIways
BY BILL PRICE.


termination to put through the Senate their bill
placing heavy excess profits tax on net incomes of
street railways above per cent return established
valuation.
The bill is aimed directly at the Capital Traction
Company's bulky profits, obtained from riders
through the inequtes of the ngexisting street rail
way situation, and is intended as a club to compel
merger of the two rival companies.
If the bill becomes law the effect will be to equalze
the financial situation of the two companies SO far
as their net profits 60, and in the opinion of Congress
and the Public Utilities Commission, greatly tend
toward a voluntary merger of the interests control
ling each corporation.
1t has long been evident that the Capital Traction
interests entirely unconcerned about attempting
to merge with the Washington Railway and Electric
interests anything like the terms the latter com
pany would demand. The Capital Traction is wal
lowing in prosperity and profits resulting from
one of the most complicated street car problems in
the country. Why give up 'cinch," regular gold
mine-THE PUBLIC being the mine! Nobody can
blame the G. T. CO.. if you look at it from selfish
viewpoint and eliminate the public altogether.
The W. R. and E., on the other hand, doesn't want
to play Jonah to the whale If it is to be swallowed
it wants to make terms with the whale that will
promise satisfactory things for it's stockholders It's
unyieding attitude is based its future prospects
1t the Potomac Electric Light Company,
spendidly managed, and making money. Its valuable
branch lines extend into suburban portions of Wash
ington that growing fast. Its officials believe
that if the company can weather the lean days for
few years longer it will be the dominant factor in the
street field of Washington, and have the Capital
Traction Company its knees begging for a merger
Everybody understands, of course that the game is
one of protection of stockholders just little game Of
street railway chess in which the king, queen, pawns
and all pieces finances Juggling for favorable
position.
Congress has been watching the moves, and notes
that the game is draw. But Congress also decides
that the carriding public is just profoundly con-
cerned the financial interests back Of the situa-
ton. For the public to pay any one company hun
dreds of thousands of dollars yearly it is not entitled
to, is not right, and the Ball plan is to gobble up
this overpayment in the shape Of taxes, in the belief
that if their positions more less equalized,
the controlling powers of the rival companies will
get together and work out merger that will mean
LOWER CAR FARES and better street service
1t is manifestly improper to impose supertaxes
good management and efficiency, under ordinary
circumstances, and in private business Public uti
ties though, are not private business. They are to
serve the general public.
Congress could have courageously solved this prob
lem several years ago by directing the purchase Of
the two properties by the municipality, to be
operated by the District government There
is legal question involved to the right of Con
gress to do this There is legal question involved
in the plan of the Ball committee, and fight in the
courts is inevitable if the law is passed. Congress
and the P. U. c. believe the profits plan is
legal Even the proposed law does not assure a
merger. 1t merely paves the way for one
A merger becomes of greater Importance to Wash
ington every day. and every citizen realizes it. The
public cares nothing for the Juggling methods
for merging, but it does great deal for the
future of the District and the right kind Of service
for car riders. 1t is unanimously agreed that
merger would mean economies that would bring
fares and imnrnyed service That Ia not