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Show i mn BILL f "PtSCED BEFORE THE SENATORS i Return of $915,000,000 Annually Whilf Properties Proper-ties Are Under Control. CHAIRMAN SMITH REPORTS MEASURE Believes Provisions Are Just and Equitable and ThsThey Will Be Ac-cepted Ac-cepted by Roads. WASHINGTON, reb. 7. Chairman s-itb of the- senate- interstate, com-oerjtr.ittee com-oerjtr.ittee in reporting favorably tie senate- today the administration administra-tion railroad t ill estimate J that under the c:es-re s provisions the- governor.-.: wi'J guarautfe annually to the railroads of the country $ i1 4 3 ,00 0 .0 0 C, i:ch will represent a return of 5.S2 per cent. This, he s;is. reboots neither r.-vertv nor riches," but the committee r-.iieves a majority of the rai'.reads will s .-rvt "these terms as a j . t and fair rcisure of the.r constitutional rights." An srecir.er.t on the bill was reached : :r the committee last Saturday, but -verity reports are to be submitted ry Senators Cummir.s and La I'oUette. Aixiaistratioti leaders plan to call the :iii up for consideration next Monday. "Your committee is of the opinion :ijt this is the time for war emergency Initiation and not t time to settle rray controversial and vexed ques-:::r.s ques-:::r.s ccacernic; our future transports-policy," transports-policy," Chairman Smith says in ::e:'io:r his report. He then takes tie compensation section and adds: Expected to Accept Terms. i "About seventy-five operating rail-re rail-re sis do over 0 per cent of the j N-'rw-tiTi ess. The committee be- j JjtT that most of those crea: rail-; read curriers will accept these terms as I ius: and fair measure of their oonsti- , irsl rights. Section 1 further pro- j viies ordir.ary taxes, national and j :.:-. sha'l. a now. be paid out of j ::4raiiug revenues, but war taxes ac- i under the act of October 3. ?17. i vi to be paid by the companies out ! ::' tieir ot:i funos cr charged sjaintt j ?:auiard return. I:i other words, holiers of railroad securities are to j Ht their o'vn just p-orriou of the war j -irn. Section 1 ai?o requires that each BijTeetnent shall continue adequate and aipropriute provisions for the maintenance main-tenance and depreciation of the propertv and the creation of reserves, so that the properties may at the end of federal control be returned to the owners in a condition substantially equivalent to their condition when taken over bv the government. A War Need. "There has, of course, been much j discussion as to the fairness and justice of the proposed amount of the standard : j return. It is plainly in the public in- terost and, indeed, a war need. The! rights of owners must bo tested by I present conditions not by some theory j of capitalisation never niace operative I under federal or state law or generally j followed by the courts." Chairman Smith explained that in j case of controversy over compensation I the bill permits an ap.peal to the court j of claims. The committee recommends, j the report says, that improvements made ' j by the government wh:le the carriers are ! under covernment control should go to j jthe railroads when they are returned to! the security holders. "This should be1 arranged throueh an asreement between ! the carriers and the president. . Return Provision. ! Discussing the provision i;i erto! bv the committee providing for the term!-i nation of government control eighteen' months after the peace proclamation has, been issued, the report says: .' "It is possible that certain conditions! may arise from federal control which j will need adjusttr-.ent before the proper- ; ties are returned to their owners, and ! a reasonable period should intervene in which these conditions may be met and adjusted. It may be that the na- 1 tion will be unwilling to return to the conditions obtaining before the assumption assump-tion of federal control. Legislation niav be demanded radically charging the re- ' lation of the povernment to the railroads rail-roads from that now existing in the interstate commerce act as amended. Your committee has suggested a period of eighteen months, and they believe it will be found adequate for that pur- ; pose. May Relinquish Control. "There is also a provision to the effect ef-fect that the president may, jrior to July 1, nest, relinquish contrcd of such transportation systems as he may deem not needful or desirable, and may, thereafter, there-after, on agreement, relinquish all or part of any system of trnnspoi tjtion. The section also contains a general provision that the president may relinquish relin-quish all railroads at any time when he vhad deem such action needful or desirable." de-sirable." A minority report was filed by Senator Sena-tor Poindctttrr. fiepiiblii-an, of Washington, Washing-ton, who asserted no definite time for returning the railroads to thelr original owners should be rixed until definite plan had been worked out, correcting the defects in the transportation system. The senator also objected to the provision provi-sion authorizing the president to '-on-trol rates subject to an appeal to the interstate commerce commission. Minority Report. Senator Fomdexter. in his minority re-ron. re-ron. taid he believed the consensus ot' nuhlic opinion is that the present sy.- j iem bv which the railroads are compelled i to operate as rival competitors for busi- I pe-sv linger private ownership with very; i.rr.lted governmental regulation is a fail- j """It Is a great n:ist.tke. In my Juds;- -ner.t." the senator said, "for this com- , i-uiiee to r-.-o.-nmend that on a certain I date ti c railroads should be restored lo pnute ownership without in any wav . char c ins the dangerous and unscientific j .-onditions which existed up to the time; the transportation systems were taken ovr bv the president. i "I An not think that public opinion will 1 tolerate a return lo the.se conditions, j public Interests leauire that competing, lines should be regarded an a part of the : transportation system of the country, and ; that business should be so distributed be- : tween them as to afford on the whole the cheapest and best s-rvi, e to the public. Difference in Earnings. "L'nder the system, which It is proposed pro-posed bv the committee amendment to restore eighteen months afifr the close ot the war. tome railroads earn as high as . per cent upon their capitalization, inflated in-flated ab It Is, while other roads, which were equally necessary to the communings communi-ngs which thev served, earned no piotits j at al' l'nder Government operation, with , profits and losses of all the railroads go- t In ultimately into one account, such In- j equalities would adjust themselves. I'n- j rler private, ownership, it Is obvious thatj this Inequality of returns is inequitable and unjust. ' "This bill makes no provision tor the j prevention in the future of such whole- sale looting of public transportation systems sys-tems as were perpetrated in the ca.es of the Chicago & Alton, the Rock Island, the New York, New Haven & Hartford, the Pore Mauiuette. the Krisco, the Cincinnati, Cin-cinnati, Hamilton &. Dayton, and others. Possible Saving. Perhaps JJ0O.O''l0,000 a year could be j saved to Lhe people of the country by do- ins awav with the multiplication of offi- i . ials and the cutting oown of over-large over-large talnrles if the roads were consoli- j dated nni operated as one Iransporia- j ticn s'vsiem. The'si-nator asserl.s that the plan pro-: poc-d hv the committee for the president; to initiate rales is illogical and un- . workable." qi is a little too much to expect of human nature that officials who owe their oricinl existence to the president will be able, however much thev may try. to (.XPrrjie anv reI independent Judgment or action in felting aside the president's j orrl.-rs In the matter of rate." I i |