Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-10-02
GOVERNMENT RAIL
POLICY ATTACKED
Sargent Tells Bankers Con-
vention Future of Transpor-
tation Lines Is in Danger.
BY the Associated Press.

DS t1le AbooSldteu FIcSS.
CLEVELAND, Ohio October Fired
W. Sargent, president of the Chicago &
Northwestern Railway Co., told members
of the American Bankers Association at
their closing business session today that
the Governments transportation policy
threatens the future welfare of the rail-
roads.
He said profits of the railroads have
been constantly nibbled away by rate re-
auctions, beginning with 1921 and cul-
minating in reductions in rates on grain.
At the same time, he said, consider
able quantities of freight have been lost
by the railroads in the diversion of traf-
fic from them to inland waterways and
highways. The competitors of the rail-
roads have been subsidized, he charged,
by taxpayers money.
Expenses Held Greater.
while these processes of rate reduc-
tons and the diversion of traffic by sub
sidized transportation have been taking
place, the carriers expenses have been
increased largely through agencies oper-
ating under Government law" Sargent
said, until today the rates of compen-
sation ere greater than the highest point
Of war wages, and our taxes are at the
highest level in the history of the Amer
lean railroad administration and are in
cre7siog by leaps and bounds each year"
Sargent said railroads are one of our
largest contributors toward prosperity,
The public is their creditor to the extent
OF between IL and Is billions of dol
lars, in bonds, he added.
The subject Of Government confisca-
ton of the railroads through these
practices, he said, demands "the hon
est, fair and clear thinking Of the bust
ness men 0f America
Lawmakers and politicians were at
tackled by Fred I. Kent, director of the
Bankers Trust Co. of New York, who
told the convention he deplored the
existing worldwide tendency of the
masses of people to follow unbalanced
and INSCRIPTIONS politicians in finding
remedies for economic conditions by
methods in direct violation of knowl-
edge gained by experienced men,"
Government in many quarters has
fallen into incompetent hands, and. in
consequence, respect for law has been
dissipated," Kent said
He blamed political agitation over our
agricultural situation for the stoppage
of the normal flow of grain from this
country, resulting In surplus in this
country.
He said that while the direct cause of
world depression is overproduction, some
dCCSleTdIlOI1 was given 10 III Dy Tie lOIlB
delay in tariff legislation in the United
States, which caused great uncertainty
in business in many foreign countries
as well as in America"
Sees Increased Prosperity.
The convention yesterday heard Col.
Leonard P. Ayres, vice president of the
Cleveland Trust Co., and nationally
known business statistician, predict that
1881 will be year of progressive bust
ness recovery, and that by the end of
next year conditions will have reached
the mark halfway between the bottom of
depression and the peak Of prosperity.
Another optimistic view was voiced by
Alexander ID. Moves, financial editor Of
the New York Times, who said Amer
lea has always started climb to new
business pinnacles from serious depres-
sionS
THE average of the business cycle is
about two years on the upgrade and one
and one-third on the down." Col. Ayres
said. I'VE have now been IL months on
the downgrade and this is another in
dication that the tide is turning"
Savings deposits in banks run in
cycles along with the business cycles"
he said When a depression arrives
We draw out our savings to pay our bills.
AS we reach prosperity there is a grad
ual decline in savings. In prosperity we
do not save as much as we do in de-
preston"
Support was given yesterday to the
section of the House resolution pending
in Congress providing that taxes on
shares Of national banks be measured
by taxes on competing moneyed capital.