Evening star. [volume] (Washington, D.C.) 1854-1972, 1929-05-22
HOOVERSTATEMENT
IS CALLED WARNING
Comment on 0'FaIIon Case
Seen as Hint Not to Try
J.
to Raise Rates.
BY DAVID LAWRENCE.


President Hoover's comment on the
OFallon decision of the Supreme Court
of the United States, or at least his re-
marks on the effect Of the decision, are
so unprecedented that they carry an
unusual significance.
Ordinarily, a President of the United
States does not discuss the policies of
the Interstate Commerce Commission,
because 1t is a Quasi-judicial body, and
ordinarily, also. no President is in a
position to predict the course that an
Industry will take when it has the right
to determine for itself the prices that
it will charge the public.
Does Not Wish Increase.
But Mr.. Hoover. not only because of
his economic background. but because
of his belief that the Federal Govern
nnent is in large part responsible for the
economic progress of the country, makes
the statement that he is confident that
there will be no increase in railway
rates" largely because he wishes the
railroads not to make such increases.
His confidence, in other words is part
OF a gentle warning to the railroads
that it would be the better part of wis
dom not to adopt a rate raising scheme
which inevitably would provoke Con-
gress into a consideration of the repeal
Of those sections of the transportation
act which have permitted the Supreme
Court to view with favor the method OF
valuation espoused by the railroads.
Senator Brookhart OF Iowa, already
IA out with a statement that Congress
should repeal or modify existing law,
declaring that the Supreme Court did
not say that the Interstate Commerce
Commission must use the reproduction
costs as the basis for valuation. but
merely said that since Congress had
directed this factor to be taken into
consideration, the commission must
abide by the law.
U. S. Ownership Still Possible.
ct think we can correct the defects
Of the law" said the Iowa Senator.
But II we can't. We can always 60
back to the plan of Government owner
ship and take over the roads"
Mr.. Hoover does not in his state
ment, point to the dangers Of rate
raising policy nor to the possibilities OF
Government ownership nor the passage
BY Congress of restrictive legislation,
but his warning to the railroads not to
take too literally the Supreme Courts
decision, nevertheless Is one method OF
counseling the roads to let we'll enough
alone. There is some indication that
railroad men are not altogether agreed
as to the soundness of Mr.. Hoovers
view and that they prefer not to be
committed to any particular policy,
though they realize that rate raising
activity at this time might be inexped-
tent in view Of the agitation for farm
relief, through reduction in transpor-
tation costs.
Economic Viewpoint Taken.
Mr.. Hoover is speaking really not only
from the viewpoint of the political
leader. who does not want to see the
farm situation In Congress complicated
by q debate on railroad transportation
costs. but from the viewpoint OF an
executive who Is concerned with the
possible unbalancing of the economic
structure.
Mr.. Hoover's statement Is an indica-
ton that from time to time he Will
feel free to express his opinion on eco
nomic subjects, even though they may
not have a direct or legal relationship
to the ofice of the President.
Mr.. Hoover's influence Is believed 70
have been instrumental in the recent
reduction of freight rates on farm
products designed for export, and there
is every reason to believe that many
railroad men will see some advantage
In the blunt statement from the White
House that the Supreme Court decision
Is not to be followed by any readJust-
ment In the transportation policies OF
the country. 49,.