The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1924-01-12
LIBERAL
To FORCE
ACTION
Progressive Republicans Can
Demand Democratic Aid on
Rail Legislation.
BY JOHN T. LAMBERT,
COemOpOIitan News Service.

nave TO cnange Inc EScn-CummlnS
act to provide lower freight and
passenger rates or climb into the
same boat with the Republicans.
Senator LaFollette's strategy
has forced them into that hole.
Senator Wheeler of Montana, a
hard-hitting radical Democrat,
started the fight which prevented
the election Of Cummins as chair
man of the Interstate Commerce
Committee. Senator LaFollette
came out of sick bed and caused
the election of Senator Smith, a
Democrat, as chairman.
Fusion Can Dominate.
That fusion has shown the coun.
try that a combination of Demo
Gratis and liberal Republicans can
dominate railroad legislation at this
session. The liberals will go to any
end with the Democrats to cut the
rates. In fact, they would abolish
the Esch.Gummins act gladly. Be.
fore the session ends, they will at.
tempt to convince every shipper
and every passenger, who rides on
q train that freight rates can be
cut at this session just as low as
the Democrats are willing to go.
The income of the railroads last
year is estimated to have been
about $4,000, 100000, twice as much
as the appropriation bill of the
nation. Former Congressman Keat-
ing, now editor of labor, says their
earnings the past nine months was
officially 5.27 per cent on all their
valuation Of about $20.O00,OO0 900.
That, however, is not the half
Of it. Mr.. Heating declares that
the 5% per cent allowed the roads
on their valuation under the Esch-
Cummins act will allow twenty.
seven Of the biggest trunk lines in
this country to pay dividends rang.
ing from 10 to 81 per cent on their
stock, including the water.
Outstanding Bonds.
Mr.. Heating says the outstanding
bonds are about $4,000 900 900. The
outstanding stock of January /,
1923, was about $7,25O, ZOO, 900, but
the roads are being permitted to
earn dividends on their valuation
of about 100000, 100000. On that
basis, Mr.. Heating said, the Central
Railroad of New Jersey can pay
dividends of 21.40 on it's stock, the
Michigan Central, 1904; Pennsyl
vania, 1856; Chicago, Burlington
and Quincy, 1915; st. Louis-San
Francisco, 1915; Illinois Central
1889, and so on down to the Balti'
more and Ohio, at 1896 per cent
The valuation scheme laid down
In theory in the recent decisions OF
the Interstate Commerce Commits
sion make it possible for the rail.
roads to take an additional $780,.
100000 a year out of the pockets OF
those who pay the freight and
those who ride on trains.
Senator La Toilette estimates that
the railroad rate can actually be
cut $500, 100000 year and provide
good service and a reasonable re.
turn to the shareholders.
Rate Plot Seen.
Mr.. Heating believes that tho rail.
roads are conspiring actively to pre-.
vent the public from enjoying rate
and fares reductions which are i'm.
mediately possible. Enormous sums
of money are being sunk into rail.
road equipments and Improve.
ments," he said, to prevent the
roads surplus being used to reduce
rates. He says that $280,000, 900 has
been spent for maintenance" in
the past nine months alone. Esti-
mates are made that 81 900 ZOO, 200
was spent in various forms Of lin.
provements" in the past year.
An interesting political fact is
that Senator Cummins, who fifteen
years ago was a conspicuous foe of
greedy railroads but who gave them
the Esch.Cummins act has now
suffered the most serious defeat of
his career, while Senator La Fol.
lette, who has always kept his face
in the same direction, is today at
the zenith Of his career.
Legislation looking to a reduction
of freight rates, especially those on
farm products, will receive the at.
tention of the Senate Interstate
Commerce Committee, Senator
Smith, the new Democratic chairman
of the committee, announced yester.
day afternoon.
Smith declined to go into detail
concerning his legislative program
but issued the following statement.
CAS- a result of unusual condi.
tions, /, a Democrat, have been
elected chairman of the Committee
on Interstate Commerce at a time
when my party is in a minority in
the Senate. 1t Is not possible al
this time to anticipate what action
the committee will take touching
the important measures which 1t is
expected will be brought before it
There is a widespread demand for
substantial decrease in freight
rates.
'All interested should cooperate
to provide relief from the burden
of excessive freight rates. This
applies with especial emphasis to
the intolerable burden imposed
under present rates on agriculture
think all fair-minded persons
realize that ! am not in a position
to define hard and fast program
for the Committee on Interstate
CnVoYnavoa