Evening star., 1938-10-23
RAIL DECISION
MAY SET HISTORY

Presidents Committee Due
| to Submit Solution
on Thursday.
By the Associated Press.
! Three men are working in secrecy
for a solution of $3.50, ,000. 900 argu-
ment over railroad wages, II they find
the right answer, they may make
history.
Next Thursday they must present
to President Roosevelt their decision
In the bitter deadlock between railroad
management and labor over Is
per cent wage reduction.
Nearly 100000 men who operate
the Nations vital network OF rails
already bave voted to quit their jobs
rather than accept the pay cut.
Presidents Of the largest railroad
systems have testified that the finan-
cial future of their key industry, with
more than $4,000, ,OO0, 900 invested,
depends on the quarter billion dollars
that could be saved annually through
the wage reduction.
Most Critical in 50 Years.
Authorities on railroad history rate
this dispute as the most critical in
the so years that railroad labor has
been subject to Federal supervision
and legislation.
Never before has a President named
an emergency fact-finding board to
deal with so broad deadlock-involv-
ing substantially all OF the major rail-
roads and all Of their employees.
Machinery which has kept the pres
ent dispute within conference rooms so
far was set up in 1888. Both railroads
and their employees are required TO try
working out agreements through con-
ferences, mediation and arbitration.
When these fail. the President may
step in and appoint an emergency 1act-
finding board in Anal effort to avoid
Interruptions of interstate commerce.
President Roosevelt named such a
board on September 26-Chief Justice
Walter P. Stacy of the North Carolina
Supreme Court, Dean James NJ Lands
of Harvard Law School and Prof.
Harry A. Mills OF the University Of
Chicago.
Board Started from Scratch.
Although most Of the arguments in
the rail wage dispute had been aired
publicly for months. the board started
from scratch when it opened hearings
September 80.
More than 800 men attended its ses-
sions in large caucus room Of the
House ONCE Building. Strangers had
a difficult time telling railroad presi-
dents and executives from leaders of
brotherhoods and unions until they
learned the management was at the
left OF the board, brotherhoods at the
right.
Railroad presidents painted gloomy
picture of their industry. They told
how one third of all mileage now was
operated under bankruptcy or receiv-
ership; how automobiles, trucks, buses.
airlines, pipelines, waterways and hy-
droelectric power has reduced traffc;
how investors who put billions into
their stocks and bonds had failed to
get interest and then lost much of
their investment.
They contended new taxes for pen
sions and social security were a bur-
den. and that the cost of living had
dropped. They said there had been
= voluntary wage reduction, agreed to
by labor. in 1892, the cut had been
restored and then new increase
granted. They complained that en-
ployes failed to bind themselves to
arbitration OF the present dispute.
Labor Equally Gloomy.
Railroad labor replied with an
equally gloomy account They told
how more than 100000 railroad
workers had been forced out Of steady
employment since 1920: how present
wage scales resulted from past agree
ments between men and management:
how larger and faster trains had
benefited Management.
Labor spokesmen insisted that in
terest and other fixed charges OF
railroad financing, not wages, were
the industry's burden. They argued
that a large per cent Of the railroads
actually are making money, that those
in receivership had been financially
i'll for years, and that complaints
originated with problem railroads"
which should use the courts to scale
down their flxed charges.
The labor spokesmen argued that
the weblike rail industry could cause
Nationwide wave Of wage reductions
that would retard recovery, If man
agement's request was granted.
Both sides presented expert Wit
nesses-and conflicting masses Of
charts, graphs and decisions.
Lands Asks Many Questions.
Dean Lands, former chairman Of
the Securities and Exchange Commits
sion, sat nervously on the edge Of his
chair, smoking cigarettes in q
white holder. He grilled railroad ex-
ecutives as to just how they decided
to ask the wage cut why they selected
IS per cent, whether they had con-
sidered the relationship Of rail wages
with other industries pay rolls.
Prof. Mills, eldest of the board,
smoked his pipe, made numerous notes,
asked few questions.
Judge Tracy. the chairman, twirled
gavel in his hands and sought to
iron out minor disputes between op-
posing lawyers.
As the public testimony and argu-
ments ended 4 week ago, Judge Stacy
said the board would need the re-
manning 10 days to prepare the report
for President Roosevelt.
Even when it becomes public, neither
party is bound to accept it, although
public opinion is supposed to give it
weight. But 80 days must elapse after
the report before railroads can re-
duce pay or workers strike. That is
the law.
HALLOWEEN FETES