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I take it that your communications to the railroads in your region should be to the respective presidents, receivers, or other chief operating officers with such modifications of that practice as you may think advisable, arranging, however, in case of such modifications, that the president, receiver, or other chief operating officer fully understands the practice which you pursue.
Pending the further shaping of the work, there are various general subjects which you should refer to this office and in all such cases I shall appreciate your suggestions or recommendations. Among such subjects are financial problems and legal problems.
I wish to emphasize that I do not consider it expedient for the Regional Directors to undertake to establish without my approval, policies of a public character, i. e., policies which substantially affect the character of service rendered the public or the rights of the public.
Substantial reduction of passenger service is an example of this character. It is impracticable to define these matters clearly, but practical definition will evolve gradually as cases arise. Meanwhile doubtful questions should be submitted to me.
The controlling principle is that the Government being now in possession and control, it is important for the Director General, as the direct representative of the Government, to have a voice in deciding matters which primarily affect the public, because we can not expect that the public will be entirely satisfied to have these matters settled by the railroad managers, which in the public estimation will still be regarded as imbued with the attitude of private management, no matter how disinterestedly those managers may be endeavoring to represent the public interest and nothing else.
Generally speaking, you will develop your organization as you think necessary, but it seems to me that in any event you will need a competent traffic representative who should be selected with the concurrence of Mr. Edward Chambers, who will be in charge of the Division of Traffic with headquarters at Washington. I think you had better treat your organization as tentative until you have submitted the organization plan to me, as I may, upon consideration of tentative plan, wish to make some suggestion upon the subject.
Very sincerely yours,
A. H. SMITH, Esq.,
(Signed) W. G. McADOO, Director General of Railroads.
Regional Director, New York, N. Y.
R. H. AISHTON, Esq.,
Regional Director, Chicago, Ill. C. H. MARKHAM, Esq.,
Regional Director, Atlanta, Ga.
GENERAL SUMMARY OF WEATHER OVER THE DISTRICTS OF THE UNITED STATES TO EASTWARD OF THE MISSISSIPPI RIVER DURING THE WINTER 1917-18 TO DATE.
FEBRUARY 6, 1918.
Cool weather set in much earlier than usual over the eastern portion of the country, September, on the whole, averaging several degrees lower than the normal, while October was cold throughout nearly the entire month, almost winter conditions prevailing throughout the regions from the Ohio Valley northward to Canada. There was some improvement during November as to temperature, although over much of the territory from the Mississippi River eastward the month was several degrees cooler than normal.
There was a general absence of severe storms in November; in fact, the month was decidedly dry and there was much less than the normal of snowfall. As a result, outdoor work of all kinds was possible to an unusual degree and under most favorable conditions.
Early in December marked cold weather overspread all eastern districts of the United States, and, save for occasional breaks, the cold was continuous throughout the month. The latter part of the month was particularly cold over the more eastern and northeastern districts, the temperature falling to 40° below zero or lower over the northern portions of New York and New England, and the month, as a whole, was among the coldest during the past 50 years.
There was little snow on the ground at the beginning of December, but near the end of the first decade heavy falls occurred from the lower Ohio Valley northeastward to New England and generally in the Lake region, the depths in immediate Ohio Valley ranging from 8 to 14 inches, while at points in the upper Lakes region the depths were nearly twice as great.
Toward the end of the second decade additional snow fell over the Appalachian Mountains and to the eastward, at which time all central and northern districts from the Mississippi River eastward were snowbound, the depths ranging from 6 to 10 inches from the Ohio Valley eastward nearly to the coast, while farther north the depths were from 10 to 20 inches or more, and so badly drifted as to interfere materially with traffic.
A moderation in the cold during the early part of the third decade of December caused most of the snow in the Ohio Valley districts to
disappear, and there was a substantial reduction in the depth over the Appalachian Mountains and to the eastward.
For December, as a whole, the snowfall was unusually heavy in the Ohio Valley and in most districts to the northeastward. In some sections of this area it was from two to four times greater than the normal, being at many points the heaviest experienced since reliable records have been kept—a period of about 30 years--and in some localities more snow fell in December than usually occurs during the entire winter. As far south as northern Tennessee the monthly totals ranged from 15 to 23 inches.
The latter part of December was cold, but without material snowfall, but early in January moderate falls occurred from the Mississippi Valley eastward, and again about the 7th heavy snows occurred from the middle Mississippi Valley northeastward to the Lakes, the falls in portions of central Illinois and around the southern end of Lake Michigan ranging from 8 inches to nearly 2 feet. High winds accompanied the snow and much drifting resulted, which greatly interfered with traffic. During the early part of the second decade of January, additional snow occurred over wide areas, and at the middle of the month the greater part of the country was snow covered. In the Ohio Valley and Lakes region the fall was again heavy, and the depth of the snow cover ranged from 10 to 15 inches or more.
Throughout January, unusually cold weather continued over all districts from the Mississippi Valley eastward, but particularly in the central and southern districts, where the average temperature ranged from 10° to 14° below the normal.
The total snowfall for January, 1918, like that of the preceding month, was much heavier than usual in the central districts from the Mississippi River eastward. The falls were particularly heavy around the southern end of Lake Michigan and thence southward to and over the southern tributaries of the Ohio. In the great mining sections from southwestern Virginia northeastward to Pennsylvania and thence westward to Missouri and Arkansas the total snowfall for the month ranged from 1 to 2 feet or more, and in the vicinity of Chicago the totals were from 3 to nearly 5 feet. At times during the month heavy winds drifted the snow badly. From the Mississippi Valley eastward the total snowfall for January, 1918, was unusually heavy, being in most cases from two to four times as much as is usually received during that month.
For the period December 1, 1917, to January 31, 1918, the average temperature over the districts from the Mississippi Valley eastward has been among the lowest of record for an equal period of time in the past 50 years.
In this connection it is interesting to note that in the far western districts of the United States the weather during the winter so far
has been unusually mild and there has been little snow; in fact, the lack of precipitation in parts of California had already produced serious results, and absence of any material accumulated snowfall in the mountains is causing serious concern for the agricultural outlook during the crop-growing season.
ORGANIZATION OF FINANCE SECTION.
MARCH 7, 1918.
Director General McAdoo has approved the following plan submitted by the director of the Division of Finance and Purchases for the organization of that division, substantially as follows:
The director of the division will be assisted in the work of investigating and providing plans to meet the financial requirements of the railroads throughout the country, whether these needs relate to the taking up and renewal of maturing obligations and the issuance of new securities, or providing for betterments and additions, by an advisory committee of three men, experienced in finance, who will be selected, one from the North, one from the West, and one from the South. These men, whose names will be announced later, will serve the Government without compensation, and will have offices in Washington.
The gross earnings from operations of the railroads of the country for the calendar year 1917 amounted to something over $4,000,000,000, but the requirements for new capital, outside of revenue from earnings, for new equipment, betterments, and additions, have usually called for from $250,000,000 to $750,000,000 per annum, according to the activity of business and the condition of the money market.
In the matter of purchases for the railroads, which will amount to between $1,000,000,000 and $2,000,000,000 per annum, the director of the division will be assisted by an advisory committee of three, which will be composed of the general purchasing agents or vice presidents in charge of purchases of three leading railroad systems, who will be detailed to Washington for this work, under the supervision of the director of the division.
There will also be constituted three additional committees; these committees to be composed of three or more general purchasing agents, or men experienced in this work, to be known as the regional purchasing committees, with headquarters in New York, Chicago, and Atlanta, in touch with the regional directors of these three districts.
All purchases of locomotives, passenger, freight, and other cars, and steel rails will be made directly through the office of the director of purchases.
Fuel.-In the New England territory fuel purchases will be made by a special committee appointed by the regional director, under the direction of the Washington office. In other sections, each railroad will be expected to handle its requirements, under the immediate direction of the respective regional purchasing committees, either collectively with other companies, or separately, as may be directed by that committee. The details of all contracts already made and of all other contracts as made will be scrutinized and checked by the regional purchasing committees, which will act under the general direction of the central committee.
Crossties and lumber.-Crossties and lumber which can be obtained along the lines of the respective roads will be negotiated for and purchased through the purchasing department of each road, under the supervision of the regional purchasing committees. Crossties needed by the various roads which can not be obtained on their own lines will be purchased through the Washington office.
All other supplies needed for current operations will be purchased, for the time being, through the purchasing departments of the respective roads, but all contracts for periods of six months or longer must be approved by the regional committees before completion.
Information as to the prices paid for all supplies will be furnished monthly by all roads to the regional purchasing committees, so that the prices paid by each road for all articles may be carefully compared and checked, both as to prices, standards, qualities, and places of delivery.
The regional purchasing committees will address themselves as soon as possible to consideration of the opportunities for standardizing and consolidating purchases of every kind that may admit of such treatment, with a view to increasing efficiency and economy.
The regional purchasing committees will submit to one another and to Washington, as information and for criticism, full statistics as to cost prices of materials used in railroad operations, and these prices will be carefully compared and checked.
The names of the advisory committee in the Section of Finance, and of the advisory committee in the Section of Purchases, and the names of the three regional committees will be announced in a few days.
UNIVERSAL INTERLINE BILLING.
MARCH 19, 1918.
Director General McAdoo to-day issued an order establishing universal interline billing between all railroads subject to Government