Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-10-21
A Far-Reaching Decision.

the railroads for fiat increase Of fif-
teen per cent on all freight rates. has
proposed to the roads that they request
/ specific increases on listed number of
| commodities and that the increased
earnings be pooled to aid the weaker
roads in meeting their interest charges.
The request for the blanket increase is
! denied.
The report of the Interstate Com
merce Commission. which contains its
! ,t:arnatiye plan for the railroads. is
I wol ny of the most serious considera-
| ton by the railroads and by the public.
It's recommendations are designed to
aid the railroads in an emergency
caused by the business depression and
at the same time to prevent too great
strain upon business, which Is now
| struggling back to its feet. The COM
mission recognizes that one Of the great
dangers of the emergency, so far as the
roads are concerned, lies in the attacks
which have been made on railroad Sc
curities and railroad financing.
Under existing conditions the CON-
mission has turned its back on a
blanket freight rate increase. It's de-
cisi-n is wise. Obviously fiat increase
| In rates on all commodities would work
| hardship and injustice to many pro-
ducerS and shippers. They would be
| unable to inset the increases and con-
70 h1Jci ~
modities and shippers can stand in
creaseS In freight rates without serious
! impairment of their business. and stu
others would be compa ratively little
affected by increases. The commission
has undertaken to separate these COM
modities and shippers into groups that
! are to BE- protected from increased rates
al this time and those which may with
/ justice to the railroads be compelled to
| pay more for their transportation serv-
! ices.
! At best, blanket increases in freight
rates or in rates charged for other
services are unsound and frequently
unjust. A demand for a blanket in
rates on goods entering the country
would be somewhat similar to a fiat
! increase on all commodities carried by
| the railroads. The rate structure has
been built up through years CT pains
| taking labor on the part of the railroads
and the Interstate Commerce Commits
sion which regulates rates. There are
, constantly changing conditions which
affect individual rates without affecting
the whole schedule of rates.
Speaking of its own plan of specific
rate increases, calculated to raise for
the railroads an additional 100000 900
to $l25,000.000 year, the Interstate
Commerce Commission says: 1T is
designed to avoid imposing burdens on
industry which cannot reasonably be
borne under present conditions, to limit
the diversion of traffic to other forms
of transportation and to disturb bust
ness conditions as little as possible by
preserving very generally existing rate
relations" The commission very OBJ
viously is seeking, in its decision and
recommendations, to guard the public,
the producers and shippers and to aid
the railroads. The task has been one
Of great difficulty. The measure of re-
lief accorded the railroads will be chal-
lenged in some quarters as inadequate.
The request of the railroads for a fiat
increase of fifteen per cent in the
freight rates was calculated to return
to the roads, if traffic we're not inter-
fered with, more than $400,00 900 adj
ditional income. The danger, however,
as pointed out by the commission, lay
in the fact that such an increase might
have materially reduced traffic and
diverted it to other transportation
agencies.
The suggestion of the commission that
the gains made in income by the rail-
roads through the rate increases. recon-
mended be pooled to be used for the
benefit of the weaker roads may be
looked upon askance by some of the
stronger roads. But those roads must
realize that any aid to the weaker links
in the railroad transportation system
is bound to prove an aid to the whole.
In period of depression such as has
had the country in its grip no one
industry may be singled out to avoid
injury. The railroads have already suf-
fered greatly from the depression, but
so have other great industries of the
country. Such aid as is proposed for
the banking system Of the Nation by
President Hoover is to be supplied by
the stronger banks of the country. It
seems eminently fitting that the
stronger railroads should play their part
in the present emergency by aiding the
| weaker roads.