RAILWAY SERVICE AND REGULATION

SUMMARY

War as emphasizing inadequacy of transportation facilities, 129. — Extra burdens upon transportation due to the war, 130. History, extent and consequences of insufficient transportation facilities in the United States, 133. - Statistics of car shortage since 1907, 135. — Reasons for inadequate transportation facilities, 143. — Traffic conditions compared with expansion of railway plant, 143. — Duty of railroads to furnish adequate equipment, 145.- Popular misconception of car shortage, 146. — Aggregate supply of railroad equipment sufficient in most years, 149. Relation of railroads to each other in exchange and interchange of cars; recent disregard of car service rules; unfortunate results of the historical relations of shipper and railroad, 150. — Early facilities in excess of needs, 153.-Significance of increase in number of commission and middle men, 157.- Position of Interstate Commerce Commission on reconsignment, 159.- Responsibility of government regulation, 161. — Importance of adequate return upon investment and transportation facilities, 161. Necessity for extension of federal authority over railway service, 166. - Esch-Pomerene law only a beginning, 167.- Comprehensive control of railway service necessary even with continuation of government operation or adoption of government ownership, 170.

THE world war with its abnormal demands upon the railways of this country has strikingly emphasized the inadequacy of our transportation system. The extra burden thus thrown upon the railroads has been due, among other things, to a larger amount of traffic, a falling off of water-borne tonnage, and unusual labor conditions. In the first five months after a state of war was declared to exist between this country and Germany, the railroads handled more freight tonnage than in any whole year previous to 1904.1 On 51 per cent of the railroad mileage of the United States in the summer of

1 Railroads' War Board, Official Information No. 18, November 27, 1917.

129

1917, there was an increase of 16 per cent, or 3,354,000,000 ton miles in one month. This was equivalent to adding 35,000 miles of railroad to that of the United States, with an average density of freight traffic on each mile equal to the average density of all railroads in the United States in 1915. This virtual addition to the fixed plant of American Railroads nearly equaled the total railway mileage of Germany in 1913 and exceeded that of Great Britain in 1914. In the last annual report of the Pennsylvania Railroad Company, it is claimed that the ton mileage of that system for the year 1917 exceeded by over 60 per cent the combined annual ton mileage before the war of all of the railroads in Great Britain and France.

That less water-borne traffic has been responsible for a part of this marked increase in rail traffic may be seen from the fact that vessels, not only from the Great Lakes but from our intercoastal trade, have turned to the more profitable ocean carrying trade. This shift is reflected in the percentage of our exports and imports which have been carried in American vessels since the war began. In the fiscal year 1914, this percentage was 9.7; in 1917, it was 18.6. In the fiscal year 1915, there was a total of 335 vessels with 1,846,658 tons cargo in the coastwise trade from the Atlantic to the Pacific and vice versa. In the first half of the fiscal year 1917, there were but eighteen vessels with a tonnage of 97,363. From testimony before the Newlands Committee, it appears that prior to the autumn of 1915 there never had been

1 Railroads' War Board, Official Information No. 8, July 7, 1917. Seventy-first Annual Report (1917), p. 7.

• The figures from 1914 to 1917 (fiscal years) are as follows: 1914, 9.7; 1915, 14.3; 1916, 16.3; 1917, 18.6. Annual Report, Commissioner of Navigation, 1917, p. 101.

• Panama Canal Record, vol. x, p. 464. See also statement of Julius Kruttschnitt in hearings before the Committee on Interstate Commerce, U. S. Senate, 65th Congress, 2nd Session, pursuant to S. Res. 171, pp. 196, 197; hereafter referred to as Hearings on Government Control.