The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1931-05-22
RAIL Way Rate
BOOST HIT BY
congressman
Western Senators See No
Benefit to Nation in
Freight Hike.
FARMERS ARE OPPOSED
Reaction in Money Circles
of New York Said to
Be Favorable.
Eastern railways ask rate increases.
Page 19)

By ScrtppS- II Ot0drd Newspaper ALttdncs
WASHINGTON, May 22-Danger
signals we're set here today against
the railroads plea for higher freight
rates.
Criticising the decision Of east
ern rail executives to apply for new
rates ito protect their credit, " west
ern senators and other spokesman
for agriculture declared that such
step would mean disaster" for the
farmer.
Opinion among industrial leaders
was divided. The reaction in New
York financial quarters was favor
able to the project.
Senators Charles L. McNary, Will
liam E. Borah and Robert B. Howell
were among those who questioned
the wisdom Of the proposal. Rep
resentative Robert Crosser inter
preted the plan as "a clever scheme
by the railroads to justify wage
cuts"
Attacked by Farmers
Representative William C. Ram
seyer and Fred Brenckman of the
National Grange also attacked the
proposed increases. Unofficial SEN
timent at farm board headquarters
likewise was antagonistic.
Dispatches from q number Of
cities showed a wide divergence Of
opinion among industrialists who
commented on Thursdays Scripps-
Howard interview with rail ex-
ecutive. in which the decision to
appeal to the interstate commerce
commission was forecast.
Some of those who commented
found in the proposal a chance to
give prosperity q helping hand;
others felt that increased rates only
would shift the burden from trans
portation to industry and to the
consumer.
1t was reported here on good au-
thority today that the movement
toward increased rates had its
origin in warnings from savings
banks and insurance companies
chat state regulatory laws would
force them to dispose Of their rail-
road holdings, if returns from these
securities fell below the statutory
figures.
Bogey Faces Rail Chiefs
The possibility Of such investors
dumping rail securities on the mar
ket in large quantities. forcing their
prices farther down, is said to be
the DOGGY that hauntS the railroad
presidents.
The National Association Of
Mutual Savings Banks is holding
a convention in Washington now,
and this problem was reported to
be on the agenda at a business
meeting today. 1t was understood
that a resolution indorsing the rate
increase proposal was being pre-
pared.
Ralroa~ earnings would have to
be increased this year to keep Sc
curities in the preferred investment
class, it was pointed out. IN
usually quick action by the I. @. G.
would be needed to make this pos
sible, but the commission has been
known to move rapidly when rea-
sons for urgency were presented
to it,
McNary Is Opposed
Senator NIcNary (Rep., Ore.),
chairman Of the senate agriculture
committee, declared today that AN
increase in the rates on agricul-
tural products would be disastrous
Tor both railroads and farmers"
II favor a Redistribution of
rates" McNary said. whereby
bulky agricultural products would
be given low rates, and luxuries
would bear heavy rates. Agricul-
tural rates are too high now"
ANY such idea as freight rate
increase is mot popular with us
westerrers," said Senator Borah
(Rep., Idaho). Il should want any
such proposition to be studied care
fully by the senate interstate COM
merce committee, with Senator Cou-
Zens at its head" Chairman Cou-
gems declined to comment on the
railroads proposal.
Agitation for higher rates is in
opportune, inadviSable, and not at
all likely to effect its purpose, in
the belief Of Senator Howell (Rep.,
Neb), a member Of the senate COM
nittee on interstate commerce. He
likened the railroads to IAN anxious
merchant trying to collect q bill
while there is crepe on the door.
Iowan Against Boost
Representative Ramseyer CRep.,
Ia, a candidate for the speakership,
said "the idea of increasing freight
rates as q relief measure sounds
bit strange. I certainly would OPP
pose any such increase.
Members of the farm board de-
clined to comment, but the i'm.
preston seemed to prevail at the
boards headquarters that a gen.
eral increase in freight rates on
farm products would be disastrous
TO agriculture.
IF the railways are out to de-
stroy more Of their own business.
they could thing Of no better way"
said Fred Brenckman, Washington
representative OF the $780, 900 farmers
in the National Grange. Instead
of increasing rates they should
lower them"
Ben Cain Sr, general counsel Of
the American Short Line Railroad
Association, which includes about
$50 short lines, said that while he
had not given the proposal a thor
ough study, he personally doubted
the wisdom Of asking general rate
increase at this time"