Evening star., 1933-08-19
Rate Decree Stirs Interest
In Handicaps of Rail Traffic

Differences Of opinion exist as to the
Justice Of the ruling by the Interstate
Commerce Commission that freight rates
should not be reduced at present. One
point of dispute Is as to whether re-
auctions would increase the volume OF
traffic. The country is surprised that
1t would be disastrous to the roads to
make a freight cut of 10 per cent. 1t
Is also a matter Of comment that the
companies are given greater discretion
In handling rates. The revision was
asked by farming, coal and lumber in
terests. Changing price levels for COM
modities are believed to have some In
f1uence. New attention is given to the
need of greater coordination in forms
Of transportation. =.
THE chief interest to the layman." !"
thinks the Lincoln State Journal, lies
In the finding Of the commission that
the railroads Of the country are IN such
a position financially that even q 10 per
cent reduction in rates would prevent
most Of them from paying fixed charges.
The commission says that general rate
reductions would threaten the continu-
ance Of adequate service and add to un-
employment and that the preservation
OF an adequate railroad Transportation
machine is more important to the coun-
try than lowered freight rates. The
decision leaves with the railroad q
larger degree Of management than the
commission has been willing to permit
In the past. If the management be-
lieves that it is good business or neces-
sary to meet truck rates, 1t Is left free
to do this. In fact. the railroads have
been doing it for many months, but
the difference between the two policies
Is that in doing his they are exercis-
ing the Independent Judgment Of an
owner or operator, while commission
direction is by a regulatory body whose
chief business is to see that the rail-
roads charge only reasonable rates"
"The central thesis Is sharply under
scored" says the Baltimore Sun. 1T
is that the railroads, though now OPP
Grating at rates above the general level
of prices, lack revenues adequate to
their needs and the national need Of
them. and that there is no likelihood
that, by reducing rates, their volume
of traffic would be expanded to de-
gree to Offset the decreased revenue per
unit of goods moved" The Sun con-
cludes: Right or wrong In its reason
ing. the I. c. C. decision, because OF its
sternly argued contention that lower
freight rates, to match lower prices gen.
orally, promise no good to the railroads
or the community generally. constitutes
very important commentary on our
economic system and its woes"
"An in ALL" according to the Newark
Evening News, this decision will be
helpful in betterment, as it is protec-
tive to the railroads and their reduced
working forces" On the logic OF the
ruling, the Evening News makes the
comment: IF the pressure Of economic
conditions upon the railroads justified
raising freight rates when business was
declining and commodity prices falling,
how could reducing freight rates be
justified at time, when. as now, busi-
ness is rising and commodity prices are
improved. But the railroads basic
financial situation is unchanged? That
Is the lcgic which majority Of the
Interstate Commerce Commission ap-
plies in refusing the general rate reduc-
tion sought by basic producers It
seems inescapable. Equally inescap-
able is the truth of the commission
majority's rejoinder to the complaining
shippers that the freight-rate level Is
not depressing the volume Of trafac or
business"
Rates on some classes Of commod-
ities," In the opinion Of the Charleston
Is. c. Evening Post, ARE high enough
to be an important factor In the price
and o serious burden to producers, but
the railroads themselves being just Is
badly OF as any Of the shippers, the
decision Of the commission refusing
general rate reductions was reasonable.
The complaining shippers, chiefly. farm.
coal and lumber interests. are those
more dependent on the railroads than
almost any other class, and however
hard their lot may be under existing
freight rates, It would be great deal
harder with Q bankrupt transportation
system. They need railroads to haul