Herbert Hoover: The Man and His Work

by Vernon L. Kellogg

It requires no lengthy economic or moral argument as a platform for denunciation of all waste and useless expenditure. Some sane medium is needed between comfort and luxury. Failing definition, and objection to blue laws, the theme must be taken into the area of moral virtues and become a proper subject for the spiritual stimulations of the church. There is a psychology in luxury wherein we all buy high-priced things because they are high-priced, not because they add comfort—and this has contributed also to our high cost of living, for those who do it drive up prices on those who try to avoid it. From an economic point of view, the only recipes are taxation as a device to make it expensive.

More constructive than increasing taxes is to take a holiday on governmental expenditures and relieve the taxpayer generally. If we could stave off a lot of expensive sugges

tions for a few years and secure more efficiency in what we must spend, then our people could get ahead with the process of earning something to be taxed. This would at least be comforting to the great farming and business community.

Better Transportation Facilities

There is a great weakness in our present railway situation bearing upon the farmer and consumer. Everyone knows of the annual shortage of cars during the crop-moving season. Few people, however, appreciate that this shortage of cars often amounts to a stricture in the free flow of commodities from the farmer to the consumer. The result is that the farmer, in order to sell his produce, often unknown to himself makes a sacrifice in price to local glut. The consumer is compelled at the other end to pay an increased price for foodstuffs due to the shortage in movement. The constant fluctuations in our grain exchanges locally or generally from this cause are matters of public record almost monthly. On one occasion a study was made under my administration into the effect of car shortage in the transportation of potatoes, and we could demonstrate by chart and figures that the margin between the farmer

and the consumer broadened 100 per cent in periods of car shortage. Nor did the middleman make this whole margin of profit, because he was subjected to unusual losses and destruction, and took unusual risks in awaiting a market. The same phenomenon was proved in a large way at time of acute shortage of movement in corn and other grains.

The usual remedy for this situation is insistence that the railways shall provide ample rolling stock, trackage and terminals to take care of the annual peakload. We have fallen far behind in the provision of even normal railway equipment during the war and an additional 500,000 cars and locomotives are no doubt needed. Above a certain point, however, this imposes upon the railways a great investment in equipment for use during a comparatively short period of the year when many commodities synchronize to make the peak movement. The railways naturally wish to spread the movement over a longer period. The burden of equipment for short time use will probably prevent their ever being able to take entire care of the annual delays in transport and stricture in market, although it can be greatly minimized.

There is possible help in handling the peak load by improving the waterways from the

Great Lakes to the Atlantic seaboard by way of the St. Lawrence River, so as to pass full seagoing cargoes. It has already been determined that the project is entirely feasible and of comparatively moderate cost. The result would be to place every port on the Great Lakes on the seas. Fifteen states contiguous to the Lakes could find an outlet for a portion of their annual surplus quickly and more cheaply to the overseas markets than through the congested eastern trunk rail lines. It would contribute materially to reduce this effectual stricture in the free flow of the farmer's commodities to the consumers. Of far greater importance, however, is the fact that the costs of transportation from the Lake ports to Europe would be greatly diminished and this diminished cost would go directly into the farmer's pockets. It is my belief that there is a possible saving here of five or six cents a bushel in the transportation of grain. Although a comparatively small proportion of our total grain production flows to Europe, I believe that the economic lift on this minor portion would raise the price of the whole grain production by the amount saved in transportation of this portion of it. The price of export wheat, rye, and barley—sometimes corn—usually hogs—in Chicago at normal times is the

Liverpool price, less transportation and other charges, and if we decrease the transport in a free market the farmer should get the difference. Not only should there be great benefits to the agricultural population, but it should be a real benefit to our railways in getting them a better average load without the cost of maintaining the surplus equipment and personnel necessary to manage the peakload during the fall months. It has been computed that the capital saving in rolling stock alone would pay for the entire cost of this waterway improvement over a comparatively few years. The matter also becomes of national importance in finding employment for the great national mercantile fleet that we have created during these years of war.