Evening star., 1940-03-12
Wheeler Demands
Parity Payments
To Farmers
Senator Also Discusses
Railroads Problems
In Forum Address

Senator Burton K. Wheeler, Dem
ocrat, of Montana spoke on The
Railroads and Economic Conditions
Confronting the Country" last night
In the National Radio Forum ar
ranged by The Star and broadcast
over a coast-to-coast network OF
the National Broadcasting Co.
The text of Senator Wheeler's ad-
dress follows:
I always feel highly complimented
when The Washington Evening Star
invites me to speak on this out
standing national radio program.
The railroad problem has become
almost forgotten in the maze of war
news and clamor for an adequate
national defense. For that reason
let me say that while an Army and
Navy are absolutely imperative to
the national defense, no army is
victorious whose avenues of sup
plies are cut off or stopped. We are
at peace and we are going to remain
at peace, but it is necessary to MAIN
tain adequate national defenses, and
for such purposes sound trans
portation system is lrreplaceable.
The Importance of railroads can
hardly be overeStimated. To those
engaged in production and distribu-
ton in every State in the Union the
railroads furnish access to the mar
ketS as no other means of trans
portation can. But the Importance
OF railroads is not limited by the
indispensability of the services they
render. Think of the army of men
and women they employ directly
and indirectly. Think of the de-
pendence of the heavy industries
on railroad purchases. Think also
of the billions of dollars invested
in their securities by individuals in
every walk of life as well as by the
great savings institutions of this
Nation.
Today one-third of all railroad
mileage Is in MISUNDERSTANDING
third totters on the brink of re-
ceivership or bankruptcy. The re-
sponsibility for this debacle in some
measure can be attributed to chang
ing economic conditions and to the
competition of buses, trucks and
private automobiles, but railroad
officials and bankers must also &C
sept their share of the responsibility
Taxes Drain on Finances.
Ever mounting State taxes upon
property, which is often not only
improbable but an actual liability,
also constitutes real drain on rail-
road finances. The various States
should give consideration to the
subject.
1t is a mistake to think that in
creased rates necessarily mean in
creased revenues. The railroads
have learned, since they are no
longer a transportation monopoly,
that merely raising rates will not
insure financial recovery. Railroads
are geared for mass production.
There must be mass consumption of
the services they offer. Lower rail-
road rates tend to increase the VOL
ume of traffic and net revenues. This
is no theory, it is an established fact
in the instance of many railroads.
There is no single panacea for the
railroads any more than there is a
single panacea for the rest of our
economic ills. The railroads need
what every manufacturer needs,
better business, a greater volume of
business. Legislation cannot in
crease traffic, it can only prevent
the recurrence of abuses and evils,
or subject all competing carriers to
the same regulation. I am seeking
to accomplish both of these obiec-
tives with pending legislation.
Though railroads have been and
are being subjected to competition
which in many instances is unfair.
I DO not feel that any existent form
of transportation should be de-
stroyed or unduly regulated. Trucks,
buses, pipe lines, ships and barges,
all are necessary mediums of trans
portation. The railroads are only
competitive units in a highly COM
petitive field. The water carriers
have received and are receiving
tremendous subsidies from the Gov
ernment, yet they complain about
regulation on the same basis with
their competitors. The so-called
Wheeler-Lea bill, which is now in
conference committee, is designed to
establish equality of regulation for
competing carriers.
Lessons of the Past.
Our whole economy is sensitive
TO the financial stability of rail-
roads. The economic and financial
effect Of $4,000 miles of bankrupt
railroads is not only felt by their
25o,oOO employees, by shippers, by
luckless security holders, whether
they be banks, insurance companies,
widows or orphans, but by govern
ment and the Nation. Here the
lessons of the past are to be studied.
They have been bitter but they have
been real The Senate Committee
on Interstate Commerce, of which
/ am chairman, has spent years
investigating railroad finances.
Railroad financial history has been
oeAS VA ANSoA ing SSSlCS VI lIlSOl-
vency, reorganization, further in
solvency and further reorganization
The process has been one of fees
for bankers and lawyers, then fail
ure. Temporary makeshifts, doomed
to collapse, but foisted upon the
investors and the public at terrific
expense and objectionable extrava-
gance, must be avoided. But worst
of all too many reorganizations of
the past have failed to produce
sound financial structures.
1t is practical problem that can
be solved only by intelligent and
realistic action. Less than a year
ago Senator Truman of Missouri
and I introduced legislation based
upon facts disclosed by the Senate
investigation.
This legislation would create 8
special railroad reorganization
court. Upon it would be placed