Atlanta tri-weekly journal. [volume] (Atlanta, Ga.) 1920-19??, 1923-11-03
HOPE FOR LOWER
GRAIN RATE NEVER
LOST BY COOLIDGE
BY DAVID LAWRENCE
(Leased Wire Service to The Journal.)
DOWNRIGHT 1923.

copyright, 1881
WASHINGTON, Nov. Hope
that the railroads may yet be able
to make a voluntary reduction in
the freight rates on grain for eX-
port has not been abandoned by gov
eminent officials, Notwithstanding
the published reports from New York
that the railroad executives were
drafting an unfavorable reply to the
request of President Coolidge for
downward revision.
The general belief here among
members of congress from north
western states is that the eastern
railroads are we'll able to make the
reduction, but that they. have been
persuaded by their western col
leagues not to do so because the
western roads are doubtful of their
ability to stand the decrease.
President Coolidge first talked
about the grain rate reduction with
Howard Elliott, of the Northern Pa
cific, and then asked Samuel Rea,
president Of the Pennsylvania rail
road, if he, too, would give the mat
ter personal consideration.
Coal Reduction Plea Also
Besides a. cheaper rate for export
on grain, Mr.. Coolidge asked that
the freight rate on coal for domes-
tic transportation should be reduced
to equal that which the railroads
now give for coal destined for ex'
port.
Details of the reported refusal
of the roads to grant the presidents
plea have not yet been received
here, but the administration hopes
something can be worked out yet.
What the railroads fear, it is SAID,
In that if they agree to voluntary
reductions on grains and coal, the
shippers will demand decreases all
along the line. Were it possible for
the administration to give assur'
ance against such contingency,
different face might be put on the
whole situation.
Rl1t the railroads are confronted
with an even more serious set or
circumstances if they do nothing for
the relief of the farmer.
When congress returns and the
farm bloc and radicals take the
reins, discussion unquestionably will
be renewed for the repeal of the
so-called guarantee" clause of the
Esch- Cummins transportation act,
clause which has been thorn IN
the side of the farmers for some
time.
Much Misunderstood
Probably no piece of legislation has
been more generally misunderstood.
1t isn't a guarantee clause at all. 1t
is simply a provision in the law
which says it is the duty of the.
Interstate commerce commission to
fix rates so the railroads as whole
or in any particular rate group will
be able 10 earn as nearly as may
be a fair return upon the value of
their property devoted to transpor-
tation purposes.
This does not mean that the rail-
roads are guaranteed anything by
the government. AS a matter of fact
congress said that for a period of
two years a return of per cent
would be a fair return, but since
March, 1920, when it took effect the
railroads as a whole claim they have
not earned that rate in any single
year. In 1921 they earned a little
over per cent, and in 1922 less than
4 per cent on their combined value.
Too High, Farmers Say
The champions of the farmer, how.
ever, have insisted that the rates
which the roads are permitted to
earn are too high. The rate at pres
ent is Sd per cent. but it is known
that many railroads are not able to
earn that much.
Agitation for the repeal OF the
clause is based on the idea that the
interstate commerce commission will
be freed from restraint, and will be
able to order reductions in freight
rates upon their own judgment ir-
respective of what the law has fixed
as a. fair return on property in
vested.
Should the railroads fail to placate
the western sentiment in congress
they will find the fight for a repeal
of the so-called guarantee" clause
will be renewed with vigor. A COM
mittee Of the railroad executives are
coming here tomorrow to explain
their position to President Coolidge.
Their final action probably depends
the turn that will be taken at the
next congress with respect to amend
ment of the present transportation.
IN l97 ~