The Waterbury Democrat., 1931-03-26
Claims It Would
 Bottle New England
 By Rail And Water
Wants Sectional Freight Outlets Maintained and Vgor ously Opposes Proposed Arrangement Sees No Substantial Benefits Accrung, Calls It War Time Plan Impractical in Peace

, in accordance with the plan is no ticeable. The proposal of the fouI trunk line systems in northeastern territory is not in harmony with f the commissions plan."
 This consolidation. according tc : reports, would subsidiZe the New 5 England roads to the Pennsylvania r lines and others. It is feared thai
 this subsidization would injure New
 England as the other lines in contro would route freight through ths , Hell Gate outlet, and, eventually cripple the New England freight
 lines and the seaports which now f operate to accommodate freight from this section of the country
 According to Congressman Goss tho , proposition of consolidation is not
 now properly before the interstate commerce commission. Therefore, he asks whether or not the question oi
 consolidation is properly before
 congress or the interstate commerce commission.
 "The subject is before the senate committee on interstate commerce for consideration and before the
 similar committee of the house of representatives for the main purpose
  unifications, but only to the extent
 that the roads promote the pubic
 interest" declared Congressman Goss. More than ten bills have been introduced on the Question in the senate and house since the first
 session of the 6Sth congress, 1925
 1924" according to MT Goss This
 history of futile attempts of statu- tory railroad consolidation is not encouraging for advocates of the statutory theory" he claims.
 "It appears that the interstate commerce commission has passed the problem to congress. The com mission referred to it's request, Tn turn, that it be relieved from the statutory requirement that it formu- late and publish plan for railroad consultations; also, that failing to obtain such relief it had adopted and published a plan on December 18th. 1929"
 The annual report of the commits ISion on December 1st, last, carries the consolidation provisions which are disputed before both houses of congress with strong suggestion that those provisions are unsound and impracticable legislation. | Referring to the grounds urged in JSuppOIL Ol lIlt tiltoly Ol tion, Congressman Goss stated: Support of weak lines: The princi- pal reason urged by advocates of con- sOlidat ton is that consolidation of railroad systems that are strong in financial resources and earning power With railroad systems tnlat are weak in financial resources and earning power will sustain or shelter the weak system and provide better serv- | rx.<.A h fHssAu system. That end can not be attained unless the stockholders of the strong companies voluntarily accept an arbi- trary reduction of the value of their securities. Will they permit their earnings to be absorbed by the weak system without obtaining any offset: I can not put myself i'm trle place of stock l<hOlders of either the strong sys- , tenn or the weak system and develop the charitable bequest needed by the weak system.
 "The boards of directors of strong l railroad corporations occupy posi- | tions of trust in which the directors can not dissipate the property or in- come of such corporations by assum- Ii ing the burdens of weak railroad cor pOratiOnS without obtaining offset ting benefits. And if the weak sys- tenn had such benefits it would not be weak. The established business policy of the strong railroad systems is to diveSt themselves of UnprOfit- able branch lines which is the anti thesis of this panacea advocated by cOnsolidationists. Action of the ] Pennsylvania system and t'le Boston 1 X Maine to divest themselves of un- profitable branch lines is well known. ''The railroad commission of Louisiana, by it's order, attempted to compel a cOrpOratiO to continue Op- eration of Il raiIrOnd when that Op- eratiOn resulted in loss of more than $1.5OO per month. The corpora tiOn resisted on the grounds that the order, if enforced. would deprive it of it's property without due process of law, in violation of the fourteenth amc mcndment tn sie Constitution of the United States. The supreme court of the United States. in Brooks ScanlOn Co. V. R, K. Commission (251 U. $. 336), sustained that contention of the corporation and said:
 "A carrier can not be compelled
 to carry even n branch of buSi-
 ness at lOss.'
 .Railroad Comm. V. Eastern Tex.
 R. R. t264 U. s. 70l. and Colorad"
 V. United States (271 U. $. 153). | are to the same effect.'
 ..The government can not compel any railroad system to assume and conduct the unprOhtable operation of another railroad system nor in the absence of exceptional circumstances can it require any large system tO continue operation of an unprOftable component. TSle fourteenth amend ment and sound business practice stand against the weak system doe Urine of the advocates of cOnsOlida- tiOn.
 | .Other reasons, urged in support of the consolidation theory. are CD fair return can he obtained at uniform rates; (2) better adjustment of rates; (3) adequate and efficient transpOr- tat:On facilities and service for all | com m unitieS; (4) limited number of more strong and stable railro"d syS- tems; (5) rehabilitation or improve ment of railroad credit; (6) more economical and convenient financing; @ sustained earning capacity. bet ter assurance of regular returns to i investors. and improved railroad credit; (S) solution of terminal prob Iems; CD economy in construction. maintenance. and operation; tlO) shorter hauls and choice of routes and better grades by railroad man ngement; GD discOntinuance of duplicate service; U2) improved ear service; G3) solid trains and heaver car loading; and u4) discontinuance of back hauls and interchange at cer- l tain junction points.
 "It k noticeable that no strong or cOgent reasons are urged in support | of this great departure from past practice In fact, TlOse IA reasons are mere remarks which do nOt inN.te lengthy discussion.
 "It has been conceded by the most nctiye adyOcates of consolidation that consolidation will effect little. any, reduction of railroad operating exnenses. MT Alfred F, ThOm, of the committee of railroad executives. at the hearing on s. 2224 u025). page C., said:
 ."I would not be frank with the committee if I did not state that good deal of expert opinion among raiIrOad people is to the effect elat the idea of economy can De over estimated as a cause for eOnsOiida- tiOn. There is a difference of Op-n- ion among men that subject