THE TRANSPORTATION
ACT OF 1920
AN ADDRESS
by
GEORGE A. POST
it
MESSAGES
from
RAILROAD EXECUTIVES
Eighth Annual Meeting
Chamber of Commerce
of the
United States
THE ADDRESS
Printed in this Pamphlet was Delivered
on April 27, 1920, at the Eighth An¬
nual Meeting of the Chamber of Com¬
merce of the United States, Held in
. Atlantic City.
AN ADDRESS, and MESSAGES
Announced in its Course, at the Eighth Annual
Meeting of the Chamber of Commerce of the United
States :
ADDRESS by
GEORGE A. POST,
Chairman, Railroad Committee, Chamber of
Commerce of the United States 1
MESSAGES from
THOMAS DeWITT CUYLER,
Chairman, Association of Railway Executives . 12
SAMUEL REA,
President, Pennsylvania Railroad 12
W. H. FINLEY,
President, Chicago and Northwestern Railroad 13
F. D. UNDERWOOD,
President, Erie Railroad Company 13
H. E. BYRAM,
President, Chicago, Milwaukee & St. Paul Rail¬
way Company ... • • J 14
E. E. LOOMIS,
President, Lehigh Valley Railroad Company - 14
W. R. COLE,
President, Nashville, Chattanooga & St. Louis
Railway Company 15
DANIEL WILLARD,
President, Baltimore & Ohio Railroad ... 16
JULIUS KRUTTSCHNITT,
Chairman, Executive Committee, Southern Pa¬
cific Lines , . 17
C. H. MARKHAM,
President, Illinois Central Railroad Company 18
HOWARD ELLIOTT,
President, Northern Pacific Railway .... 18
A. H. SMITH,
President, New York Central Kailroad ... 19
W. B. STOREY,
President, Atchison, Topeka & Santa Fe Railroad 20
RALPH PETERS,
President, Long Island Railroad Company . . 20
S. M. FELTON,
President, Chicago Great Western Railroad
Company . . . . ... 22
W. H. TRUESDALE,
President, The Delaware, Lackawanna & West¬
ern Railroad Company 22
B. F. BUSH,
President, Missouri Pacific Railroad Company 23
J. E. GORMAN,
President, Chicago, Rock Island & Pacific Rail¬
way Company 24
E. J. PEARSON,
President, New York, New Haven & Hartford
Railroad Company 24
BIRD M. ROBINSON,
President, American Short Line Railroad Asso¬
ciation 25
GEORGE C. TAYLOR,
President, American Railway Express Company 26
The Transportation
Act of 1920
GEORGE A. POST,
Chairman, Railroad Committee of the
Chamber of Commerce of the United States.
Until a few days ago, it was our confident and joyful
expectation that Chairman John J. Esch, of the Interstate
and Foreign Commerce Committee of the United States
House of Representatives, would speak to us for Congress
and tell you the story of how and why the "Transporta¬
tion Act of 1920" came to be the law of the land. He had
accepted our invitation but, unfortunately, subsequently,
matters of great importance before his Committee re¬
quired his presence in Washington on this day and he
was compelled to disappoint us.
It had been my hope, which'I strove eagerly to realize,
that a railroad executive of prominence might be secured
to appear here and assure you, in person, in behalf of
his fellow railroad executives, how vigorously and sin¬
cerely they proposed to cooperate with everybody to make
the new Transportation Act a workable statute. The
railroad executives, however, felt that it was their duty
to stay on their properties and bend their every energy
to solving the serious, vexatious and intricate problems
confronting them as they resume the operation of their
railroads so recently "emerged from federal control.
While I was unable to secure the physical presence of a
railroad president, I have here messages from many
railroad presidents sent to this Chamber, expressive of
their earnest intentions. They will be printed and fur¬
nished to the members, who will be highly pleased by
the attitude of the railway executives as registered
therein. Failing, as I did, in my commendable quest for
highly expert and attractive speakers, I am compelled to
do what you gentlemen all have to do when you are
short of help—do the job myself as well as I can.
Your Railroad Committee in its report to the Board
of Directors of the Chamber, quite elaborately recites
the provisions of the Transportation Act, which report
is in print for distribution. It is not my province, there¬
fore, to go into the details of the law but rather, in re-
portorial style, to sketch a few word pictures of what I
observed while, in the line of my duty, I kept in touch
with legislative developments from day to day while Con¬
gress deliberated upon the avalanche of suggestions,
theories and demands concerning the railroads with which
it was submerged, pouring in upon it from many sources.
An amusing little story was told at the opening of a
very able speech delivered recently in New York by that
sturdy, alert and influential Senator, Joseph S. Freling-
huysen, of New Jersey, to whom the public, and especially
the Chamber of Commerce of the United States, is deeply
indebted for his contribution of business experience and
energetic, timely cooperation with the Chamber and the
National Transportation Conference held under the au¬
spices of the Chamber, in pressing for consideration by
Congress important phases of the railroad problem.
A little boy, related the Senator, was very busy draw¬
ing a picture upon his slate when his mother inquired :
"What are you drawing, son?"^
"I am drawing a picture of God", replied the youthful
artist.
"Why, you can't draw a picture of God", said the
mother, because no one knows what God looks like."
"Well, they will when I get through with this picture",
was the conclusive reply of the undaunted kid.
Now, Congress isn't God according to the belief in
Him of us orthodox folks, but it is a very important and
powerful body.
Congress is now made up of 531 men, endowed by their
Creator with such mental powers as He intended them
to have, and with such breadth of view, sanity of judg¬
ment and knowledge of world affairs as their earthly en-
2
vironment has vouchsafed. - Ninety-six of them sit in
the Senate, and four hundred and thirty-five sit in the
House of Representatives. While the numerical size of
Congress has increased from time to time, its quality is
about the same as it has always been. Many of its mem¬
bers (by far the largest percentage) are lawyers, some
are manufacturers, some are bankers, some merchants,
and there are representatives of the farmers, of labor,
of the clergy, of public educators and of other professions
and occupations. In the present Congress there are
quite a number who have been or are railroad employees
of less than managerial rank and but one, as I recall, who
is a railroad executive. Few men chosen to Congress
have ever had any occasion, heretofore, to become stu¬
dents of railroad economics. Most of those who chance
to be assigned to the Interstate Commerce Committees of
either House, to which Committees all matters having re ¬
lation to railroad legislation are referred, have their ini¬
tiation, thereby, into the realm of transportation.
Some of the Senators and Representatives have been
on the Interstate Commerce Committee for a long period
of years, while others are comparatively new-comers
thereon. The members of these Committees, no matter
how long or brief their service, sat with the doors of their
Committee rooms wide open and invited all who wanted
to be heard to come before them and present their state¬
ments. Thousands of pages of testimony were takén,
hundreds of witnesses were heard and pamphlets were
showered upon them as thick as the leaves of Vallom-
brosa. They were attentive and studious, and for several
months, when not in open session, the members conferred
together, weighed the arguments and took counsel with
trusted advisers whom they thought possessed of special
knowledge.
You must remember also, that all the members of In¬
terstate Commerce Committees of both Houses are mem¬
bers of other important Committees dealing with na-
3
tional subjects not less important or complicated, some of
them, than the railroad question.
They sought light from varied sources, getting more
heat than light oft-times. They sought leadership from
those professing to deep knowledge and wide experience
upon transportation subjects, only to be confused by the
amazing contrariety of view of strenuous disputants.
Theirs was some big brain-puzzling job.
It was my privilege, as Chairman of your Railroad
Committee, to follow the development of legislation by
the Senate Committee on Interstate Commerce, with
Senator Cummins as Chairman. I cannot resist the im¬
pulse to pay warmest tribute to Senator Cummins for the
wonderful task performed by him, for his consistency of
purpose, the profundity of this thought, his amazing store
of knowledge of the history of railroad operations in our
country, his patience under fierce attack from forces
bitterly hostile to some of his proposals, and his complete
dedication of all his powers and talents to the consumma¬
tion of wise, just and comprehensive railroad legislation.
I would also speak in high appreciation of Chairman
Esch, of the House Committee, who for many years has
been a close, earnest and intelligent student of the trans¬
portation problem, and has always manifested a sincere
desire to deal fairly with all the interests involved there¬
in. During the many months that he presided over the
hearings before and thè deliberations of the House In¬
terstate Commerce Committee, he bore heavy burdens
of responsibility, but always with urbanity, courage and
sagacity.
I wish that all of you gentlemen could know what I have
learned of the contents of the stacks of mail daily dumped
upon the desks of Senators and Representatives. If you
were cognizant of the clamorous demands upon the time
of these men, for interviews upon every conceivable sub¬
ject that can be born in the minds of men, or move them
4
to cajole, or commandeer the influence or votes of their
Congressional representatives, you would surely have
deeper sympathy for their vicissitudes, be less bitter in
your excoriation of them and much more appreciative of
what they really do accomplish.
Do you realize the embarrassments, the disappoint¬
ments, the wearisome labors, the racking of mental
powers, the struggles for prestige, the hopes and fear3
and the diplomacies involved in sessions of a Conference
Committee upon the disagreeing votes of the two Houses
of Congress upon such an all important measure as the
Transportation Act? Think it over and then you will be
in a proper frame of mind to appraise fairly the great
work accomplished by Congress.
Out of this Congressional melting pot, with its molten
mass of variant theories, strident threats, bald and cam¬
ouflaged selfishness, real and imaginary statistics, inter¬
mixed with solid facts, public necessities and corporate
realities, was poured into the statutory mould what is
known as the "Transportation Act of 1920." It was the
answer of Congress to the "Plumb Plan" and other econo¬
mic vagaries.
Is this new law perfect in its every feature? Undoubt¬
edly not. Any piece of legislation attempting to cover
so many details, affecting so many diverse interests, mak¬
ing provision for so many prospective contingencies, so
tremendous in its effect upon our national life, can only
be the best possible composite of the views of many di¬
verging minds. Compromises had to be effected, pro¬
posals possibly wise had to be eliminated to avoid a legis¬
lative impasse. Beyond doubt it is the best legislative
program of railroad regulation ever enacted, more con¬
structive and Jess repressive.
By decisive majorities in the House and Senate the
Conference Bill was passed, and promptly approved by
the President. The railroads under this legislation went
back to their corporate owners for operation on March 1st
5
last. The Chamber of Commerce of the United States,
through its Referendum No. 28, voiced to Congress in
July last the practically unanimous wish of the business
men of the country that the railroads should, at the earli¬
est possible moment, be released from federal control.
It was the expressed opinion of the Chamber of Com¬
merce of the United States that the Interstate Commerce
Commission should be relieved of some of its burdens,
while others were added, and a new body to be called the
"Transportation Board" should be created to perform
many important functions which the new order of things
required to be done by a governmental agency. Congress
thought otherwise and placed more duties upon the Com¬
mission and increased the number of Commissioners by
two, so that they might better cope with their augmented
responsibilities. It was the right of Congress to so decide
and there is no complaint about it. Everybody has faith,
or should have faith, that the Commission, now clothed
with all the powers it asked for and much more beside,
will proceed to exercise its great powers with an eye
single to the public welfare. In the performance of its
herculean task the Commission needs, and is entitled to,
the sympathetic, honest-minded, square-dealing and gen¬
erous cooperation of all our people.
As a federation of business bodies, the Chamber of
Commerce of the United States has brought before it by
the new Act an opportunity to serve the organization
members. In order to discharge this new function some
changes in organization and in method may be required.
We shall be blind if we fail to see that a vital feature
of any fair or workable program is cooperation with the
farmers. Agriculture is business, but it is a special kind
of business and its interests are sufficiently distinct so
that it will doubtless always maintain its own organiza¬
tions ; and organized business can best promote solidarity
in every region and in the country as a whole with regard
to transportation if manufactures, trade, mining and
6
agriculture participate in joint activities for the realiza¬
tion of common purposes.
Precisely what work the Chamber of Commerce of the
United States can now best undertake it is perhaps too
soon to define. Each community, each region, has its
peculiar problems, but they all have also much in com¬
mon, one with another, and it is sufficient at this time
to suggest that the Chamber can in a valuable way lend
its good offices in aiding the constituent bodies to study
the problem and in giving central clearance to their sev¬
eral experiences for the ultimate benefit of the Interstate
Commerce Commission.
The keynote of this great assemblage of the representa¬
tives of our nation's business is Production. In order to
increase production it will be necessary to make a cor¬
responding increase in railroad facilities. At this very
time the railroads are carrying a greater tonnage than
ever before, greater even than during the war. The de¬
mands upon them are increasing by leaps and bounds, and
they are meeting them as best they may with facilities
badly impaired and badly, needing vast additions and
betterments. They are short today at least 4,000 locomo¬
tives and 200,000 freight cars and 8,000 passenger cars,
to keep pace with present public requirements. No new
passenger cars have been bought for the use of the public
in over two years and the passenger traffic was never so
heavy as now.
The railroad officials are at this time naturally more
anxious than ever to meet the demands upon them. Even
if they had the money now, which they have not, it would
be some time before they could add substantially to their
equipment. Some of the strong roads have already con¬
tracted for new equipment, but not more than half they
need, because of the restricted money market and the
high cost for borrowings. Meantime, while the rates are
being discussed and fixed by the Interstate Commerce
Commission, means of access to the government revolving
7
fund (provided for in the new law) are being arranged,
and a modicum of relief is afforded by the delivery later
on of such equipment as has already been ordered, it is
the duty of the public to be good humored, patient and
considerate. Those who receive cars for loading must
load them quickly to their capacity, and consignees must
unload with greatest possible celerity. We must not ex¬
pect miracles simply because the roads have been turned
back to their owners for operation. We have a right
to expect, and do expect, that the railroad officials will do
all that is humanly possible to meet the emergency. We
also have the right to expect and insist that the railroad
employees will cooperate with their officers and keep' the
wheels rolling and not paralyze commerce which, in. effect,
is a strike against the public whose Congress has estab¬
lished a tribunal for the fair, impartial adjudication of
labor disputes.
In my opinion, it is not a patriotic response to the call
of the Nation for increased production for thousands of.
those upon whom we rely for that production to simply
raise hell. Pandemonium and paralysis do not beget pros¬
perity.
Having made mention of the creation of the Railroad
Labor Board, I am impelled at this moment to refer to
the attitude of organized labor toward that provision,
which is deeply to be deplored. So bitter was their oppo¬
sition that after the passage of the Transportation Act,
publication was made by labor leaders of their intention
to mark for condign publishment at the polls, all Sena¬
tors and Representatives who voted for the measure.
And why, forsooth? Because provision was made for
including the "Public" in the tribunal which should deal
with the demands of labor. The theory was pressed that
only the representatives of the officials of the railroads
and the representatives of the employees, should de¬
termine labor disputes; and whatever their conclusions
were, the public which pays the bills should have nothing
8
to say. When did it become a crime, punishable by of¬
ficial death, for a representative in Congress to vote in
defense of the rights of the public? This National Cham¬
ber of Commerce represents a large part of the public,
and it seems entirely proper, indeed imperative, that an
appeal should be made to this body, and to all those whom
you represent, to see to it that no Congressman or Sena¬
tor is defeated because he upheld the right of the public
to officially participate in deliberations and decisions, in¬
volving hundreds of millions of dollars additional wages
to railroad employees, which it must pay in the shape of
increased rates and fares.
I do not deny the right of organized labor to vote for
or against any man for any reason ; but I do assert that if
and when organized labor demands that a Senator or
Representative shall be driven from public life because
he stood for public representation upon the Railroad
Labor Bqard, every mother's son of the Chamber of
Commerce of the United States owes it to himself, to his
country and to the target of organized wrath, to see to it
that courageous, fair, public service shall have its re¬
ward in militant support at our hands. As for me, my
affiliations are with the Democratic party, but I here and
now declare that in the Congressional district and State
where I vote, I shall ardently support for re-election, re¬
gardless of the political ticket upon which they run, the
man or men who, in Congress, refused to bend the knee
of subjection when threatened with defeat therefor and
manfully maintained their convictions by voting "Aye"
upon the Transportation Act of 1920.
Men of the Chamber of Commerce: "Go ye and do
likewise!" No threats were made by American business
against those who voted "No." The defeat of no Con¬
gressman is sought by organized business because he
voted "No." Freedom of thought and action is conceded
without a question to those who could not or did not favor
the Act. About some of its provisions, there is room for
9
honest differences of opinion and doubts as to their
wisdom or efficacy. The fact remains that every letter
and line of the Act was an earnest attempt made under
many embarrassments to solve a difficult problem. Cer¬
tainly the railroad executives were denied much that they
wanted—much that they opposed was included therein.
The Chamber of Commerce failed to find in the new
law all that it desired. The vigorous and vigilant War-
field Association had its ambitious plan drastically cur¬
tailed. The Interstate Commerce Commission revised
some of its original recommendations. Thoughtful stu¬
dents of finance are disappointed in the failure of Con¬
gress to pay heed to some of their proposals. But at all
times the animating thought of those responsible for the
final form of the Act was the adequate service of the pub¬
lic, with every safeguard they could think of for its wel¬
fare included therein.
Shall those in Congress who thus labored, who stood so
staunchly in the parliamentary conflict, bite the dust as
their requital? It is up to us!
10
Messages
from
Railroad Executives
THOMAS DeWITT CUYLER
Chairman, Association of Railway Executives
The Chamber of Commerce of the United States per¬
formed a great public service in mobilizing the sentiment
of business men for a law to protect railroad credit and
insure the. growth of our transportation systems. It is
now the task of all of us to make the Transportation Act
a success.
The Interstate Commerce Commission is taking a broad
and statesmanlike view of the situation and is cooperat¬
ing to the fullest extent with the railroad managements.
The obstacles immediately ahead, especially in making
an inadequate plant efficiently serve the Nation's busi¬
ness, are plain to everyone. But by earnest cooperation
these obstacles will be surmounted.
SAMUEL REA
President, Pennsylvania Railroad
Our National prosperity depends upon the willingness
of the public to pay a reasonable return upon the railroad
investment sufficient to sustain and expand our reliable
transportation service. Public opinion before and since
the passage of the new Transportation Act expressed it¬
self strongly in favor of adequate transportation service
and sound railroad credit. Now the duty of those who
use, operate, own, or regulate the railroads is to make-
that law, and that sound public opinion, promptly effect¬
ive, otherwise the Act of Congress is useless. Unneces¬
sary delays in enforcing the law add to the difficulties
of the situation, and to the deficit of the United States
Treasury which business, commerce and the public gen¬
erally must pay through taxes. The Act makes it the
responsibility of the Interstate Commerce Commission
to establish rates that will yield a suitable return on the
fair value of the railroads. The members of the United
12
States Chamber of Commerce should, collectively and in¬
dividually, without waiting for any invitation, support
the Interstate Commerce Commission in the establish¬
ment of rates that will produce the modest return of 6%
authorized. Delay or failure to act will result in insuf¬
ficient transportation facilities and service that must re¬
strict or stop the output of many factories, farms, and
mines. Disrupted working organizations, idle workmen,
and reduced profits of the mines, the wholesale and retail
business houses, the industries, and the farms will in¬
evitably follow. That cannot be bénéficiai to them or to
the public. We have spent years in theorizing about the
transportation question, the time for constructive and
prompt action is here.
W. H. FINLEY
President, Chicago & Northwestern Railway Corny any
With the return of the railroads to their owners and
the passage of the Transportation Act of 1920, the rail¬
roads enter upon a new era. The operation of the rail¬
roads by the Federal Administration resulted in bringing
home to the people of this country a better understanding
of the needs and necessities of the railroads to enable
them to furnish the necessary transportation facilities
for the people. I feel that with this enlightened public
opinion the railroads may look into the future with every
degree of assurance that railroad credit will be estab¬
lished and that we will be enabled to satisfactorily dis¬
charge our duties as common carriers.
F. D. UNDERWOOD
President, Erie Railroad Company
The railroad situation, from my point of view, is mend¬
ing for the reason that general business is gradually find¬
ing itself, and, in common with other things physical and
mental, becoming normal.
13
It has been demonstrated that the radical labor ele¬
ments who stop at nothing to gain their ends, are in a
minority. The emotional utterances (entirely without
foundation) to the effect that masses of workmen are
"underpaid, underfed and overworked," have been dem¬
onstrated false to the mass of thinking people.
We may hope, that the era of attempting to do things
through the medium of sensational mottoes and texts is
drawing to a close.
H. E. BYRAM
President, Chicago, Milwaukee & St. Paul
Railway Corny any
The railroads of the country are indebted to the Cham¬
ber of Commerce of the United States for the very effect¬
ive assistance rendered in securing consideration of the
railroad problem by Congress and in the dissemination of
reliable information on the subject to the people at large
through its local and allied organizations throughout the
country. The result has been an appreciation by the pub¬
lic of the difficulties that are before us which did not
previously exist. To restore the credit of the railroads
and confidence in them will require the best efforts of
all and much forbearance and patience on the part of the
public while we are catching up with the shortage of
equipment and facilities growing out of the war.
. ' Ü \
E. E. LOOMIS
President, Lehigh Valley Railroad Company
American railroads in their endeavor to give the na¬
tion adequate transportation service need and will wel¬
come the sympathetic cooperation of the Chamber of
Commerce of the United States. It can aid by the crea¬
tion of public sentiment for a living wage to enable the
carriers to give efficient service and at the same time re-
I I
establish their credit and provide for the necessary im¬
provements and expansions. Transportation is one of
the greatest single factors entering into the effective
operation of any large industrial plant, and business mer.
must recognize that obstructive tactics towards the rail¬
roads in the last analysis put a curb upon their own prog¬
ress and prosperity. Industry likewise must take a firm
stand with the railroads that no blatant minority in the
ranks of labor be permitted to set itself up in power at the
expense and inconvenience of the public. This is the time
for virile Americanism to assert itself and put down per¬
manently the theorists who would destroy our Govern¬
ment and its established institutions.
W. R. COLE
President, Nashville, Chattanooga
& St. Louis Railway Company
I àm pleased to note that the Chamber of Commerce of
the United States will devote a special session at its meet¬
ing next week to railroads. I know of no organization
whose views on this important subject are entitled to
more weight, or which is in a position to render more
effective aid in solving in the interest of the transporta¬
tion systems and the public alike, the difficult problems
confronting railroad managements at this time in provid¬
ing adequate facilities for the transportation of the com¬
merce of the country. The new Transportation Act
wisely administered and liberally construed, as I believe
it will be, will, I am confident, restore to the railroad the
necessary credit to enable them to again function in a
manner satisfactory to the shipping and travelling pub¬
lic, and no business organization with which I am ac¬
quainted can contribute more directly to this result than
the Chamber of Commerce of the United States.
15
DANIEL WILLARD
i
President Baltimore and Ohio Railroad
*
The Eseh-Cummins Bill, in my opinion, is one of the
most constructive and far reaching pieces of legislation
that has ever been passed by the Congress of the United
States, constructive because it affords a reasonable basis
for confidence in the future successful operation of the
railroads under private ownership with Government
regulation, far reaching because, in my opinion, it makes
possible the continuation of the system of private owner¬
ship and operation of the railroads.
For the first time, Congress has laid down a definite
program for the regulation, and at the same time for the
protection and development, of the railroads. For the
first time, Congress has given definite instructions to its
agent, the Interstate Commerce Commission, for its
guidance in the matter of fixing railroad rates and
charges, and assuming that the Interstate Commerce
Commission will give effect, as I am sure it will, to the
intent of Congress as expressed in the law, I feel that the
future of the railroads under private ownership is rea¬
sonably well assured. It will, of course, remain for the
railway managers to so conduct the operations of the
several properties as to meet the reasonable require¬
ments of the public for adequate transportation. This,
I believe, the railway managers will do.
Congress has also in the Esch-Cummins Act laid down
a policy concerning the future status of railway em¬
ployees and their relations to the employing companies.
Under the terms of the Act, railway employees are guar¬
anteed fair and reasonable wages and suitable working
conditions at all times and under all circumstances, and
having this assurance on the part of Congress, it should
be unnecessary for railway employees in the future to
make use of the strike in order to secure what Congress
has definitely guaranteed they shall have. As this pro-
16
vision of the law comes to^be better understood by all, I
believe the railway employees, as a class, will appreciate
the preferred status that they have been given by Con¬
gress, and they will willingly cooperate with the com¬
panies to the end that there may be at all times that un¬
interrupted service demanded in the public interest.
The Transportation Committee of the United States
Chamber of Commerce rendered very valuable service '
in connection with the framing of the new railroad Act
and the influence of that Committee was helpful in bring¬
ing about a better understanding of the very complex pro¬
blem. I feel confident that the future will justify the
action in this connection of the United States Chamber
of Commerce as reflected through its Transportation
Committee.
JULIUS KRUTTSCHNITT
Cliairman, Executive Committee, Southern Pacific Lines
From observations made on this trip over Southern
Pacific System and from conferences with officers charged
with the supervision of its seventy-five to eighty thous¬
and employees, I feel that when the full effects of the
Transportation Act of 1920 shall be felt railroad condi¬
tions will be substantially improved. The Interstate
Commerce Commission is conferring freely with rail¬
road officials and is diligently seeking to carry out the
mandates of Congress, the effect of which should streng¬
then railroad credit. The hostility of labor which was so
pronounced before the end of Federal control has been
replaced in many directions by a spirit of cooperation and
loyalty which has already resulted in an increase of effi¬
ciency. With the encouragement and cultivation by em¬
ployers of this altered feeling, I believe mutual confi¬
dence will grow and will inspire such friendly and co¬
operative relations as will profoundly benefit both em¬
ployer and employee.
17
C. H. MARKHAM
President, Illinois Central Railroad Company
I believe that altogether too much attention is being
paid to statements that private ownership and operation
of railroads is now being subjected to its final test. It is
the talk of the street and of the press that the next few
years will determine whether these great transportation
agencies will remain under private ownership or whether
they will be taken over by the Government. The state¬
ment may be true but it is only a partial statement of the
truth. If it is a fact that private ownership of railroads
is being given its final trial, it is equally a fact that
American institutions which we have so highly cherished
are also on trial. A socialistic wave high enough to na¬
tionalize the vast industrial life represented by the rail¬
roads will not subside when fed with that result. Great
as is the financial interest of the railroad owners and of¬
ficers in the success of this branch of private manage¬
ment, failure at this time will mean more to every citizen
who believes in that principle of individualism which has
carried our Government to the foremost position in the
world.
HOWARD ELLIOTT
President, Northern Pacific Railway
The people have just said in the new transportation
act that they desire their transportation furnished
through private ownership and management, with gov¬
ernmental regulation, protection and encouragement.
The railroads are now working under that act and
struggling to overcome the difficult "after-the-war" con¬
ditions that confront all industry.
To make a success of the new plan and to furnish the
transportation needed will require much patience, for¬
bearance, courage, and the best of "team work" by all,
18
with full assent to the fact that the roads must have ade¬
quate revenue if they are to survive as "going concerns".
The managements of the railroads realize keenly their
responsibility, and it is their earnest wish to cooperate
heartily with the State and National authorities, the
public and the employees, and to keep the American rail¬
road "ready to serve" and to meet every call that may be
made upon them.
The United States has now a greater opportunity than
ever before to serve its own people and the world, and to
overcome promptly the serious world conditions resulting
from the war.
An adequate rail transportation system is one essential
if we are to avail ourselves of that great opportunity.
I believe there is man power, brain power, courage,
patriotism and vision enough in the country to succeed
if all will pull together, work long and hard, and eliminate
selfishness, waste and extravagance.
A. H. SMITH
President New York Central Railroad
The improved public sentiment toward the railroad
companies, which was interpreted into action by Con¬
gress returning the properties, is taken by the railroad
managements as a vote of confidence. The railroad forces
are thrilled and inspired to their utmost exertions by
this evidence of trust from their fellow Americans and
are going forward to the great task with the utmost con¬
fidence and determination. Your railroads are in safe
hands, gentlemen. With a constructive policy of regula¬
tion by the authorities, dictated and sustained by an in¬
telligent understanding of the economic problems in¬
volved in giving the nation good transportation service,
they will make good.
The railroads are your railroads ! They are your ser¬
vants, and your business prosperity depends largely upon
19
their ability and the quantity and character of service
they give you. They were first in war, first in peace and,
though not always so in the past, I hope they will yet
be first in your hearts.
W. B. STOREY
President Atchison, Topeka & Santa Fe Railway
I believe the Transportation Act of 1920 to be the first
strong constructive statute relative to transportation that
has been enacted. Before this the only mandate to the
Interstate Commerce Commission was to protect the
interests of the public. The Commission is now charged
with the task of protecting the railroads as well as the
public. We on the Santa Fe believe in the law and we
believe in the Interstate Commerce Commission. We
propose to work with the Commission toward the better¬
ment of present conditions and toward giving the public
the service it should have. We will strive to give trans¬
portation at the lowest rate possible, but primarily we
will strive for good service "and for ample service. It
is our feeling that this is what the country needs.
RALPH PETERS
President, The Long Island Railroad Company
There is no one part of the commerce of the United
States that is of more vital importance than that of trans¬
portation, and especially the transportation furnished by
the railroads.
While this country was endowed by nature with thous¬
ands of miles of ocean, of sound, of lake, and of river
frontage, giving opportunities for the very cheapest form
of transportation, there was but little development, and
that very slow, until the railroads were constructed and
the whole country opened up by means of transportation
that discovered and brought forth the wonderful wealth
20
of the nation. These railroads were developed on such
broad lines that they furnished cheaper and quicker
transportation than that supplied on the rivers, lakes and
sounds.
Enterprise and vision of the great railroad builders of
the past made this possible. Enterprise and vision of the
railroad executives of today will continue the growth
and development required to keep the United States at the
forefront of all nations and at the head of all commerce.
It is indeed a great blessing to this country that the ex¬
periment in Government ownership has been made and so
promptly found wanting, as under no conditions could
Government ownership develop the enterprise and the
vision necessary to continue the growth of these great
arteries of commerce. They cannot be stopped. Our
country has not been fenced in or walled about. There
is still greater and more urgent need for transportation.
It will be provided by the enterprise and ability that still
exists in the railroad service. All that is needed is the
vigorous cooperation and support of the great business
interests so strongly represented by the Chamber of Com¬
merce of the United States and those associated with it.
The difficulties surrounding the business today are
many, but through the new Transportation Act, the help¬
ing hand of Government has been extended; encourage¬
ment is given to enterprise, and I am satisfied that the
men of vision in command of these railroads will soon re¬
establish them as the finest lines of transportation in the
world, and that they will be able to go forward in meet¬
ing all the demands made upon them by the business of
the country, and, at the same time, their enterprise will
continue the development to even greater magnitude in
agriculture, mining, and industrial development of every
kind.
21
S. M. FELTON
President, Chicago Great Western Railroad Company
With reference to the railroad outlook. Congress has
enacted most helpful legislation for the carriers and the
public. The definite return on the value of the railroads
should enable carriers to provide for a substantial im¬
provement in service. Operating losses under govern¬
ment control were noted by investors and we must show
satisfactory results before they will buy our securities.
This will necessarily delay our work. The railroads of
the United States need, this year, equipment to the extent
of 200,000 freight cars, 4,000 locomotives and 8,000 pas¬
senger cars. It will take time to show results no matter
how hard we try.
W. H. TRUESDALE
President, The Delaware, Lackawanna
& Western Railroad Company
^ While it is particularly difficult at this time to diagnose
the present situation of the railroads of the country or to
foretell the outlook for the future, owing to the abnormal
conditions that exist as respects scarcity and high prices
of labor and all materials and supplies entering into their
construction, maintenance and operation, the attitude of
Congress, the Legislatures and the various Railroad Com¬
missions, State and National, as also of the press and the
public which the railroads serve, certainly is far more
, favorable and encouraging than at any time during thé
last fifteen or twenty years.
The provisions of the Transportation Act, as respects
the fixing of rates, will no doubt operate to re-establish
the credit of the railroads generally whenever the over-
speculation, which has been rampant ever since the close
of the war, shall have broken down and the financial
situation become more normal.
All indications point to the continued growth of the
22
business, prosperity and wealth of the United States, and
the business and earnings of the railroads will prosper
measurably with the prosperity of all other interests in
the country which are dependent upon them for their
transportation service.
B. F. BUSH
President, Missouri Pacific Railroad Company
■ Adequate transportation to serve the needs of com¬
merce being a most vital necessity to the well being and
progress of our entire people deserves the most careful
and painstaking consideration in the deliberations of that
eminent body the Chamber of Commerce of the United
States. The products of the farm, mine, forest and fac¬
tory are indispensable requisites to our very existence.
The highest efficiency attained in the development of
these avails naught unless ample means are provided for
their distribution. Adequate and satisfactory transporta¬
tion must be forthcoming before they can be beneficially
utilized to the advantage and profit of our people. The
physical and financial conditions of the railroads today
are woefully lacking in the essentials necessary to the
promotion of production and commerce. The transporta¬
tion capacity is not sufficient to meet the needs of the
country and retardation in the development of useful
products is the result. Every enterprise is dependent
upon the efficient conduct of our railway system and it is
of the first importance that it be placed upon a healthy
and permanent foundation to insure this desideratum.
Railway credit must be established upon a sound and at¬
tractive basis.. Reasonable remuneration to the carriers
for service performed will accomplish this and afford
them the means to efficiently expand their facilities. The
Transportation Act of 1920, administered by the Com¬
mission in accordance with its terms in an effectively
broad and judicious manner, will go far toward relieving
23
the railways of the difficulties which now beset them in
their endeavors to function for the public good, and will
better enable them to meet the requirements of the
greatly increased commerce promised by a proper de¬
velopment of our resources. Our country has now at¬
tained to the proud eminence of holding as her due the
commercial supremacy of the world, and this should be
her rightful heritage for ages to come if the means at our
command are wisely applied.
J. E. GORMAN
President, Chicago, Rock Island & Pacific Railway Co.
Knowing the keen interest of the Chamber of Com¬
merce of the United States in the present railroad situa¬
tion, it might not be inopportune for me to suggest that
a satisfactory settlement of the rate question over¬
shadows all other matters now confronting the railroads.
Captial is needed and must be provided to enable rail¬
roads to meet requirements of transportation. The pres¬
ent situation indicates a continuation for an indefinite
period of the heavy business now being handled by them.
A liberal adjustment of the rate situation will go far to
continue the present business prosperity of the nation.
E. J. PEARSON
President, New York, New Haven and
Hartford Railroad Company
The necessity by Commerce of adequate transportation
and the dependence of the Railroads on traffic resulting
from Commerce involves a mutual problem. The car¬
riers, while undertaking to meet your demands to the
fullest extent with their present plant, admittedly more
or less inadequate, believe that through private Opération
the questions of service, cost of operation and the direct
consideration of the many matters of joint interest can
best be handled. They also realize the necessity of aid
from every source toward the restoration of their credit.
With credit, the railroads can expand currently with the
growth of business. Without it, deficiencies of recent
years must continue. During the interim of readjust¬
ment and while the rates for money to be obtained for
new financing are higher than the rate of return on the
valuation of the Railroads provided in the Transporta¬
tion Act, the Railroads in looking ahead to the expansion
of their capacity realize that credit is essential now if
improvements are to become of benefit a year or so later.
They also strongly believe that such ultimate benefits will
be mutual and they ask your cooperation in matters of
the new tariffs, and forbearance particularly in condi¬
tions relating to both service and improvements that may
be non-compensatory or remunerative.
BIRD M. ROBINSON,
President, The American Short Line
Railroad Association
The Government, in the Transportation Act, at the in¬
stance of and for the alleged purpose of benefiting the
public, has transferred to the Interstate Commerce Com¬
mission, from the builders and operators, all the real
power and control of the largest and most efficient rail
transportation system the world has ever known.
We are now confronted with a most serious emergency
as to transportation and, while Congress has conferred
upon the Commission almost unlimited powers and re¬
sponsibilities, it is apparent that the Commission cannot
alone meet that emergency. It must have help, help, help
The owners and operators have no choice. They must, in
good faith, help in every possible way. The great and
most important question is: Will the employees and
the public help?
The cooperation and assistance of the public is vital.
25
" A failure, or even a limited reduction of the present in¬
adequate service, would seriously curtail and retard busi¬
ness, if it did not destroy business generally.
Congress has responded to the call of the public for
Government control. Will the public now recognize and
meet its obligation, by supporting the Commission in all
that it finds necessary, to insure what all must have, and
that is, adequate transportation?-
GEORGE C. TAYLOR
President, American Railway Express Company
It has been my privilege to receive an invitation to
prepare a message with respect to Jthe express service of
the country, to be presented to the Eighth Annual Meeting
of the Chamber now in session.
I hesitate to burden you with a recital of what has
taken place in the express business during the last 2l/2
years. Suffice it to say that, as a war measure, the
American Railway Express Company was incorporated
and called upon to operate the express service, under
Government control effective July 1, 1918.
Notwithstanding the great economies which were
brought about by the elimination of duplicate service and
other expenses, the operations of our Company have re¬
sulted in a deficit approximating $24,000,000 per year.
We, of course, were guaranteed by the Government
against any deficit but have never been guaranteed any
return upon our property, and this is the situation which
prevails with the Express Company today and will con¬
tinue to so prevail until August 31,1920.
As you all know, the costs of conducting our business,
as with all other business, have greatly increased, and are
constantly increasing, and therefore, as I look into the
future, I cannot see the best and cheapest express service
come from a restoration of the several old companies, nor
the formation of several new ones. It would mean again
adding to the rates enough more—which the public would
I
26
have to bear—to pay for duplicate services, in the elimina¬
tion of which this Company has saved many millions of
dollars ; and it would mean a less efficient express service.
We realize our service has not been up to the standard,
and is not now, and it will take time to make it so,—in my
judgment, at least two years to reach anything like a nor¬
mal situation.
We are dependent upon the railroads for our cars and
transportation." There is not enough express car equip¬
ment in existence by some 2,000 cars to properly handle
the business of today.
The railroads are not to blame for this, and neither are
we. Their present situation is but the outgrowth of
conditions over which they had no control. No railroad
could be blamed for not being willing to spend vast sums
in new equipment and facilities and neither could this
Company be blamed ; and had we undertaken it, you know
as well as I do that with the uncertain future up to the
end of Federal control such money could not have been
obtained.
As one express company, operating over all lines, we
can give a better service by the use of the most direct
routes ;
' We can avoid much duplicate service and expense,
which in the end must be borne by the public ;
We can give the shipper only one company to look to
and not a divided responsibility and resultant delay in
case of loss;
We can avoid all circuitous routing;
We can avoid rehandling by maintaining through-car
routes ; •
We can avoid delays and damage by rehandling at junc¬
tion points in transfer to or from other companies as
formerly, and by use of all the rail mileage can fairly,
we believe, compete with the Parcel Post, who will be our
competitor, and we are glad they are here as such, and
with the competition of restored normal freight service
27
and the competition of the fast growing trucking serv¬
ice, we certainly can have no monopoly.
Further, we are regulated as to rates, practices and
service by the Interstate Commerce Commission and the
Commissions of the several forty-eight States.
To give this express organization of 135,000 people,
of which I am proud to be one, a fighting chance, to give
you an efficient cooperative and dependable fast trans¬
portation service, is all we are seeking to accomplish;
and the results of our effort will, in by judgment, work to
our mutual benefit.
2 f