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Show Popular Economics Series Copyright, Bank of the Manhattan Companj, Neu York City "The American Ways" Returning to the "American Way" of encouraging individual initiative -and enterprise. ' RETURNING TO THE "AMERICAN WAY" Vt1ITH the outbreak of the War a 9 'n Eurpc America was pftii Iplunged almost overnight into a period of tremendous industrial activity. Production in Europe, was greatly reduceu and the warring nations na-tions turned to the United States for arms, munitions, food, clothing and products of every description. The railroads of the country soon felt the strain of moving this immense Quantity of supplies to the seaboard. It was soon realized that existing transportation facilities were inadequate inade-quate to meet the new demands while still providing for the ordinary ordi-nary requirements of the country. Car shortage and congestion of traffic speedily followed; embargoes on all but essential products for domestic do-mestic use were put into effect. While this condition was aggravated aggra-vated by congestion of terminal facilities fa-cilities on the coast due to accumulation accumu-lation of supplies awaiting shipment abroad, what had long been known to close observers was gradually disclosed dis-closed to the entire public, namely, that because of the preceding period pe-riod of public hostility, railroad growth had failed to keep pace with the needs of the country. It was found that since 1907 the roads, having been unable to secure, through the sale of stock, new capital cap-ital for needed expansion, development develop-ment had come to a complete standstill. stand-still. For necessary improvements they had been forced to depend almost al-most entirely upon borrowed money. In recognition of this condition and of the mounting costs in every field of industry the government authorities, author-ities, for the first time since they had assumed the rate-making power, began to allow certain increases in rates. But these increases were quickly overbalanced by rapidly increasing in-creasing costs of operation, and the net revenues grew steadily less and less. Yet there is- little evidence that the people were doing any real constructive construc-tive thinking on the subject of transportation, although in December Decem-ber 1915, President Wilson cajled the attention of Congress to the se-I se-I Hons and pressthg nature of the I problem. On his suggestion Congress, Con-gress, In July, J916. appointed a committee "to investigate . ." the efficiency of the existing system in protecting the rights of shippers and carriers and in promoting public interest" But events abroad were then distracting public attention and lhe possibility of America entering "the War occupied the public mind t the exclusion of all else. Suddenly the country entered the War and quite as suddenly the people peo-ple awakened to a realization of the vital relation of adequate transportation transpor-tation to the life of the Nation itself. As a measure of war ezw&pcy, and with no time in which to unravel the tangle of legislative and governmental governmen-tal restrictions, the Government commandeered the railroad properties proper-ties and took over their operation. Immediately, it was able to ignore the limitations under which the railroads rail-roads had been obliged to operate, but it soon developed that even the Government could not run them without money. Having unlimited power, the Government Gov-ernment was able to appropriate public pub-lic money to make up the difference between the income received from operation of the railroad and the necessary operating expenses, this deficit amounted to nearly $1,0Q -000,000, which, if borne by the :niU roads themselves would have thrown many of them into bankruptcy. But in time of national peril the people were in no mood to count the costs and they responded with enthusiasm to every call for funds. Once more they were thinking in terms of national na-tional welfare. It is,, not important here to discuss whether this war-time experiment in Government operation was a success or a failure, for the conditions under which it was made were both exceptionally excep-tionally favorable and exceptionally unfavorable. The significant thing is that at the close of the War the American people, were not only willing will-ing but insistent that, with the passing pass-ing of the emergency of national defense, de-fense, government operation of the railroads should end. In the -face of the great task of developing adequate ade-quate transportation, they demanded 4 return to the "American Way" of encouraging individual initiative and enterprise. . |