In 1908 and 1909 the railways scrimped maintenance $300,000,000 and this will have to be made good some time, some how, before they are on as sound an operating basis as they were before the panic of 1907.
What must be done to avert the consequences described above?
A readjustment of freight rates, involving a reasonable increase applied to such articles and commodities as can stand it, without any appreciable hardship either to manufacturer, merchant or consumer, means the difference between grinding economy and a fair degree of prosperity.
The Reverse of the Picture.
Would a 10 per cent increase in freight rates mean such a difference?
It most certainly would.
It would mean the difference between closed shops and suspended improvements and the resumption of improvements with the ability to resume the large purchases of material and equipment, giving full employment to labor and furnishing improved transportation facilities, which, within a very short time the commerce of the country is going to demand more insistently than ever. To hundreds of thousands of workingmen it means the difference between steady, well-paid employment and walking the streets looking in vain for work.
LESSON XIV.
Narrow Margin Between Earnings and Expense.
"I have looked up the statement of about 80 per cent of the principal railroads of the country and find that during the last half of the year 1907, after the tremendous increase in expenses had become effective, while the gross earnings of the railroads increased $57,413,078 over the same period of the preceding year, their expenses increased $80,235,823, showing a net loss for the period, despite the tremendous business handled, of $22,822,745.