Evening star., 1940-03-16
Federal Ownership
0fRai|roads Debated
ForCiviI Engineers
Views Of Two Schools
Of Thought Presented
At Meeting

Michael J. Gormley, executive as
sistant of the Association of Ameri-
can Railroads, last night warned
the American Society of Civil En-
gineers against abandonment of pri-
vate enterprise through establish
ment of Federal control over the
railroads.
Government ownership, Mr.
Gormley said, would increase the
public debt by half, double the
number of unemployed, place too
great power in the hands of the
majority party, create a Govern
ment monopoly on all agencies of
transportation and tend to change
the form of government of the
United States.
In semi-formal debate with Col.
William j. Wilgus, former vice pres
ident and chief engineer Of the
New York Central Railroad, Mr.
Gormley undertook to dispel fears
of railroad men that the almost
total absence of credit for the rails
industry would move the Govern
ment to assume control over the
Nation-V ide railway system.
Sees 5 Billion Subsidy Needed.
Col. Wilgus previously had told
the engineers that Government
ownership Is Inevitable" He said
he was opposed to liberalization
but that it would solve the prob
lem in establishing q closer spirit
of cooperation between railroads
Government. shippers and general
public and allow speedy subsidiza-
ton for immediate rehabilitation OF
the systems. He set a figure OF
IS 900 900 900.
Col Wilgus said a large number
Of locomotives and cars are obso-
lete, tools are antiquated, yards and
repair facilities are in need of re-
habilitation and general mod
ernization of equipment is needed
Shippers have been driven tt
other means of transporting their
products" he declared. "Ihe
chances for increasing gross rev.
enue are small, present conditions
indicate. The conclusion must be
that private ownership of railroads
| cannot continue unless there are
profits to warrant investments, thus
restoring credit. Hence Govern.
ment subsidy-railroad nationalist
tion-is the only way to stabilize
the railroad industry"
Cites World War Experience.
Mr.. Gormley, arguing vigorously
against both the principle and the
practicability of Government owner
ship, painted brighter picture fol
the future after charging that Gov
ernment ownership in the first World
War had resulted in a general
deterioration of the lines.
1.-THE railroads met the depression
which followed the World War with
increased efficiency" Mr.. Gormley
said. "Our industry is a virile one
with splendid recuperative powers
completely able to cope with chang
ing conditions" He said, however
the railroad financing situation was
disturbing.
| fAllOtllCI WdA WALL oAAOW -uAAACA
private operation-a smooth func.
tioning of rail transportation, com.
pletely unlike the confusion thai
marked the last war;" he added, say.
ing also that the solution to thu
present problem is fair rates.
Cassius Clay, assistant genera
counsel of the Reconstruction
Finance Corp, placed some of th'
trouble with the "nu1hber of un'
necessary lines checkerboardint
parts of the Nation"
Mr.. Clay envisioned a govern
mental department of transportation
to coordinate the interests of tn,
various agencies to supplant tn
present system, which divides tn,
Jurisdiction and appeal for griev
ances and disputes.
The program was sponsored b,
the District of Columbia Chapter o
the society. Chairman Otto S. Beye
of the National Mediation Boar,
was mediator Of the debate.