Evening star., 1924-01-13
BY BEN McKELWAY.
HENEvER government own

KNf ership OF the railroads Is
" mentioned there are either
three rousing cheers and
widespread applause or deep means
of anguish and the usual weeping,
wailing and gnashing of teeth. de-
pending entirely upon the group. cir
Gle, clique or bloc in which the sub
5cct Is introduced.
To say that the United States Su-
premc Court has just put its august
stamp of approval upon government
ownership of the railroads would no
doubt call for jeers, catcalls, Kisses
and perhaps profane denials. But it
is nevertheless interesting, and equal
ly harmless, to study the decision of
the Supreme Court in the Dayton
Goose Creek railroad case last week,
and then count on the fingers of one
hand the powers which are now held
by the Interstate Commerce Commits
sion through the transportation act
and on the fingers Of the other hand
the rights which are left to the rail-
roads.
On the one hand is the Interstate
Commerce Commission, representing
the government, which controls the
railroads III their issue of securities,
their car supply and distribution,
their joint use of terminals their
construction of new lines and their
abandonment of old ones, the proper
division of their joint rates as well
8 the fixing of adequate rates to Sc
cure fair return upon their invest
mcnt, the value or extent of their in
Vestment and their consolidation in
groups or systems. In addition the
Railroad Labor Board has more or
less to say as what they shall pay
their employees.
on the other hand are the rail-
roads and the trains they run.
Provisions Upheld by Court.
The Supreme Court decision men,
toned above upheld the constitu-
tionaity of the so-called "recapture"
provisions of the transportation act
These provisions, stated briefly, are
that earnings of the carriers in ex
cess of return of per cent on
the value of their property shall be
divided equally between a fund to be
held in trust by the railroads and
one to be held by the government.
The carrier may use it's fund for the
payment of interest on bonds and
other securities. rent for leased
lines and the payment of dividends
In case the operating income for the
year is less than 6 per cent. When
the fund accumulated equals ) per
of tha Of ,.at n
property and as long as it continues
to do so the carrier may use it's
one-half of the excess income in any
way it chooses. The governments
fund is administered by the Inter-
state Commerce Commission in max
ing loans to carriers for certain
specified purposes and for buying
equipment and facilities to sell or
lease to the carriers.
Causes of Litigation.
The case originated when the Goose
Creek railroad received an order
from the Interstate Commerce Com
mission to submit returns showing
the value of its property employed
in commerce and the net revenue
a
revenue Of several thousand dollars
in excess of G per cent on it's valua-
tion. Perhaps it did SO in the spirit
of asking, There it is, now what
are you going to do about it?" For
when the Interstate Commerce Com
mission gently inquired as to what
steps were being taken to come
across with one-half Of those excess
earnings the Goose Creek railroad
sought an Injunction to restrain the
/. C. c. from prosecuting it's orders.
In its suit the Goose Creek railway
mentioned such things as "irrepara-
BILE wrong" and Unconstitutional"
and by the time the case reached the
United States Supreme Court a whole
flock Of railroads had hastily Joined
themselves with the Goose Creek in
stitution as amici curiae.
Chief Justice Taft, rendering the
decision of the court, referred to two
previous definitions of the transpor-
tation act by the Supreme Court and
gave an adequate description and left
no doubt Of the power that it confers
- upon the government in operating the
RAILROADS..
Seeks to Build Railways.
I'm both cases 1t was pointed out
that the transportation act adds a
new and important object to pre-
Vious interstate commerce legislation
which was designed primarily to pre-
vent unreasonable or discriminatory
rares against persons and localities.
The new act seeks aff1rmatively to
build up a. system of railways pre-
pared to handle promptly all the in
terstate commerce of the country. It
aims to give the owners of the rail-
ways an opportunity to earn enough
Lobbyists Woul,