The labor journal. [volume] (Everett, Wash.) 1909-1976, 1922-06-23
RATE CUT BRINGS
HIGHER RAIL WAGE

| ing lUto on all freight except farm
produce, it did more to solve the
problem of satisfactory wages fol
railway employees than have all the
conferences and commissions since
the war. The railroads have been
gradually starving themselves tC
death. They sought and obtained
permission from the Interstate Com
merce Commission to advance rates
to level never before known in this
country. Rates were set so high
that they often exceeded the value OF
the articles transported. Farmers
left their potatoes, fruits and vegeta-
bles to rot in the field, or even dump
ed them in the river after they Were
packed, because freight charges ex-
ceeded what they would receive for
their produce. In brief, in their de-
sire to make greater profits, the rail
roads overreached themselves and
charged more than the traffic could
bear. Facts recently collected for
the Interstate Commerce Commission
show that American railroads re-
ceived last year on every ton hauled
a mile a greater return than any
year in the last forty years; and yet
the volume of freight handled by the
roads was SO small that many Of
them faced actual bankruptcy. The
tonnage carried during the first half
of 1921 as compared with the first
six months of the preceding year
showed decrease of nearly quar-
ter of billion tons. At the same
time the roads carried nearly 74,000,-
600 fewer people. because every trav-
eler had to pay an average of 3.13
cents mile as against &c cents in
1920. Increased fares and rates will
never solve the transportation prob
lem. Even the railway executives
are now convinced that heavy traf-
fic at reasonably low rates is far
better than little traffic at high
rate.
Rate Cut Saves Railroads
The eXtortionate freight rates of
the last two years have not only
crippled the railroads and ruined the
farmers, but they have also para
lyzed American industries. Manu-
facturers have had to boost prices
in order to pay the freight on raw
materials. These price increases were
passed along by the iobber, the
wholesaler and retailer to the con-
suming public. Every article of
clothing we wear and practically ev-
cry bit of food we eat has paid its
share of this exorbitant tribute to
the transportation companies. These
higher prices made it impossible for
many consumers to buy. Retailers
and wholesalers accordingly cancelled
their orders. The wheels of industry
stopped. Untold thousands of work
ers were thrown out of employment
because their industries could not pay
the freight rates demanded of them.
The 1910 rate cut just ordered by
the Commerce Commission is the
first genuine step back to normally
occurring under the present admins
tration. 1t is not a large decrease
in comparison with the freight rate
increase of 25 to 1919 granted two
years ago, yet it has already stimu-
lated industry and commerce and
started preparations for important
crop movements from the western
warehouses. There can be no ques-
ton but that the income of the rail-
roads will be enhanced and the pros
peritv of the country greatly i'm
proved by the 1879 rate cut.
Why Lower Rates Should Bring
Higher Wages
Just as the exorbitant high freight
rates of the past two years have
so crippled railroad income that the
executives asked for wage decreases,
so lower rates will increase traffic
to the point where railroads will
find it to their profit to raise wages
in order to secure the pick of the
best human material available fol
the operation of our transportation
system. Under an honestly managed
transportation system there is an
inverse relation between rates and
wages. Lower rates should mean
higher wages, the same as higher
rates brought demand for lower
wages. This is equally true in indus
try. Henry Ford. who makes the
lowest cost automobile in America,
pays the highert wages, because he
has found that high wages attract
and hold competent men. that COM
petent men mean increased efficiency,
and that increased efficiency invari-
ably lowers cost.
The Expensive Folly of Cheap Labor
Those railway officials who are
now agitating for wage cuts are as
short sighted as they were two years
ago in pleading for eXorbitant freight
rates. Railway wages were not in
creased during the war to anywhere
near the level received by other
workers in other industries. The gen
eral wage slash ordered by the Rail
road Labor Board last July show one
eight out of the pay envelopes of
the railroad employees, thereby saw
ing the railroads $400,000.000 year.
In consequence of this cut many of
the most efficient railway employees
left the service for more satisfactory
pay elsewhere. A further wage cut
now would not only be uniustifiable,
but it would demoraliZe the nations
transportation system and place it in
the hands of the lease competent
employees. No other industry in the
nation demands such extreme care
fulness, such devotion to duty, such
continuous concentration upon the
task in hand, as does railroad trans
portation. A poor piece of workman
ship or a moments carelessness may
cost a hundred lives. The men en-
gagged in train service are charged
with the moral and legal responsible
ity for the safe handling of billions
of dollars worth of property,-the
commerce of the nation. If Henry
Ford finds it pays to hire high-class
labor to make low priced automobiles,
surely the bankers who control the
railroads, which carry over 1.000,-
100000 human beings and 2,300,000,-
600 tons of merchandise a year,
ought to realize the expensive folly
of cheap labor.
How Railroads Can Promote
Prosperity
More than any other group, the
railway executives now have it with