Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1924-10-11
MAINE PRESS
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MAINE PRESS
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think q big one. believe that the
railroad world and the newspaper |
for the good Of Maine, and both OF |
which have so many things in COM !
mon, should get acquainted.
Changes
The railroad situation has mater
tally changed in the past few years
since Federal Control and the passage
of the Esch- Cummins Bill. now, part
Of the Interstate Commerce Act as
amended, since this law regulates
, many Of the activities Of the railroads
subject to it with respect to-
(a) Operation:
(b) Rates for carriage of freight
and passengers;
(c) Wages paid employees;
Cd Accounting:
(e) Issuing Of securities for loans
and new capital. This law not only
I prescribes what may be done In the
conduct Of the affairs Of the rail-
T., roads, but attaches severe. penalties
for failure to comply with its provi-
sions.
1 The railroads are also subject to
the state laws and regulations of the
public utilities commissions, when
| not In conflict with the Interstate
Commerce Act. After a careful study
| OF the laws and regulations affecting
| railroads, the mind Is left in doubt
as to just what part the manage
+, ment plays in the railroad game.
| Territory and Rates
In dealing with the railroad situa-
, ton Immediately following Federal
Control and in prescribing rates for
transportation Of freight, the terri
tory in the United States was divid-
ed into four groups as follows:
| Southern,
| Western.
Mountain Pacific
The New England lines are en-
/ braced in the Eastern Group, which
includes the territory about as fol-
lows: north of Norfolk, Cincinnati
and the Ohio River. east Of the Mis-
sissippi River, the Illinois River and
Chicago; and 1t includes the trunk
lines and Central Freight Association
territory.
In fixing the rates for the railroads
so that they might be able to earn
a return (now 5AGe) on the fair val
J ne OF the property devoted to public
use,' the Interstate Commerce Gem
mission ruled that the rates should
be so adjusted that the railroads in
each group. considered as a whole,
should be able to earn the maximum
prescribed. At the close Of the
twenty-six months Of Federal Con-
troll and the following six months Of
partial guaranty by the United
States, most of the New England
carriers found it impossible. even
with the new rates as adjusted py
the Interstate Commerce Commission,
to pay any return to their stockhold-
ers and, in some cases, very difficult
to pay interest and rentals.
Railroad Service vs.. Railroad Rates
Railroad service is more important
than passenger fares or freight
charges which the public is obliged
to pay the railroads for such service.
1t takes money to provide safe,
prompt and sure transportation; it
takes money to build the railroads;
1t takes money to build additions to
the railroads. New capital is need
ed by the railroads every year to
build up and maintain service, /
believe, as every user of the railroads,
including those who travel as well
as those who despatch or receive
freight shipments, believes, that the
service performed by the railroads is
vastly more important than the rates
charged for such service.
The Maine Central Situation
In the case Of the Maine Central
Railroad Company, the year 1921, the
first full year of private operation
since the Federal Control period, re-
suited in a deficit of approximately
$2,00O,000; conditions improved some
what in the following year, 1922, and
although there was a reduction of
1000 in freight rates effective July
LIST. 1922, operations for that year re-
suited in a surplus after charges Of
$550,000. In the year 1923. in which
we experienced one of the worst win :
ters in our history. as well as severe
floods in the early spring. the sur
plus after charges amounted to $780,
600. For the first eight months Of
the year 1924 we had a surplus of
$4,000. and for the full year 1924
we hope to have a surplus after
charges of at least 100000, but this
Is largely an estimate as results for
the last four months of the year are
not yet known.
Results Still Unsatisfactory
One of the principal reasons for
this unsatisfactory condition is the
fact that. in spite Of all of our efforts
to reduce operating expenses and
taxes. the company's earnings have
tailed to produce the expected return
on its capital investment.
We have attempted to adjust this
matter of increased income in part
by application to the Interstate Com
| merce Commission to review and en-
large on our divisions on traffic in
terchanged with the trunk lines and
theft connections. but thus far we
nave been able to do very little in
| this respect. although we have hopes
OF receiving additional income In that
direction within a short time.
RaiIrosd-A Public Utility
The railroad is public utility and
its duty Is to perform prompt and
satisfactory service to the public, but
If hn o6iciantI1,