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Show Union Pacific Rail-road Rail-road President Summarizes Trans portation Predicament "American railroads are obviously the victims of a "squeeze play." Thus William M. Jeffers, president of the Union Pacific Railroad, summarized the present predicament of rail transportation in an address in Chicago Chi-cago today at the annual meeting of the National Industrial Traffic League: Industry, he said, can raise prices when their costs advance; ad-vance; railroads must ask permission permis-sion to do the same thing to meet the same situation. Mr. Jeffers ad- j dressed a group of more than 500 business leaders of the country, comprising executive and traffic officials of the largest industries in America. On the one nana, Mr. Jeffers said, the railroads have been compelled by economic pressure and federal enactment to shoulder the burden of wage advances, increased taxes, railroad employe retirement and social so-cial security costs, and higher prices for all materials gqing into railroad maintenance and operation. At the same time they have been compelled to accede to freight rate reductions of 25 per cent per ton per mile since 1921, one half of which has been put into force since 1929. To illustrate the force of these reductions, Mr. Jeffers declared that "if the railroads had received in 1936 the same rate they received in 1921, the additional cost to the shippers ship-pers would have been more than one billion dollars, twice as much as they are now asking to have restored." re-stored." And he added that the rates of 1921 were those which were established under government control con-trol of the railroads when the operations oper-ations were conducted by the government gov-ernment "for 26 months at a loss of one billion six hundred million dollars." The increased costs which the railroads have been compelled to take on, Mr. Jeffers said, "have added a burden estimated at 663 million dollars per year to an industry in-dustry whose net earnings aggregated aggre-gated that sum in but one year since 1930." Agricultural interests should, he said, and labor will, he predicted, support the petition of the railroads for an increase in rates. "A pauperized paup-erized railroad industry could be a ( disaster which the farmers could il! afford," he declared. The mandate of the Transportation Transporta-tion Act of 1920 "which requires 1 that competition be preserved," the failure of the government itself dur- 1 ing federal control to bring about any major economies through co- I ordination and consolidation of S railroads, and the Emergency Trans- I portation Act of 1933 in which the 5 framers of the law recognized the j necessity "for preserving oompeti- ; tion and protecting the investors r and right of labor," have shown the futility of immediate relief at this time from that source. "With this record behind us," said Mr. Jeffers, "and the sheriff on the doorstep, we would be blind to hope that relief by the route of economies from co-ordinations would come soon enough to save the industry." The Interstate Commerce Commission Com-mission in its last decision, October 19, 1937, was quoted in part by Mr. Jeffers as supporting the present situation. In part the commission said, "The record amply justifies the conclusion that in the aggregate the railroads are earning very materially mater-ially less than a reasonable return on the fair value of tbair carrier properties." "I predict," Mr. Jeffers concluded, "that if given reasonable assurances from adverse legislation and regulation regu-lation and that the game will be played according to rules laid down before the game starts, the railroads rail-roads will lead the field in progressive progres-sive development." n |