Harding Pleads in Kansas City Speech for Merger of Railroads Into Small Groups
— .. fS\_ ____,
Holds Federal
Control More
»» Expensive Plan
President Says Relation Be
tween Employes and Car
riers Is Vital Factor
in Situation.
Kansas City, Mo., June 22.—Text of
President Harding's speech on tran
sportation problems here tonight fol
lows:
My Countrymen: Stopping as I
am, enroute across the continent, to
make an official visit of Inquiry to
the vast territory of Alaska, I stand
before you to offer greetings, and
bring, if possible, the federal govern
ment a little closer to you and the
people of the United States closer to
their government.
I confess it has been something of
a problem to select subjects for lo
calities, and take cognizance of the
territorial interest In the spoken word,
and at the same time keep in mind
that the printed speech, in the days
of modem publicity, is available to ail
America. I do not mean that there
are any circumstances under which
the president would say a thing in
Kansas City that he could not say
in New York, New Orleans, or San
Francisco, because our varied na
' tlonal interests are wholly mutual In
their last analysis.
Ours is a common country, with a
common purpose and common pride
i and common confidence. I am think
ing rather of the enlarged audiences
with the marvels of the radio. I was
* speaking to you last night in St.
Louis, precisely as I am speaking to
Denver, Chicago, and elsewhere to
night. We have come into very close
communication in the United States,
and wj shall Infinitely profit if it
brings us into closer and fuller under
standing. I know of nothing which
will so promote our tranquility and
stability at home and peace through
out the world as simple and reveal
ing and appealing understanding.
Commerce Vitalizing Force.
Production is the very lifeblood of
material existence and commerce is
Its vitalizing force. Put an end to
commerce and there will be no cities,
and farm life will revert to the mere
struggle for subsistence. And there
can lie no commerce without tran
sportation. In all the exchanges
which make for commercial life,
transportation is as essential as pro
auction.
Not long ago, while discussing the
distressing slump in agricultural
prices which threatened the very ex
istence of farm industry, a caller
drew from his pocket an old Ohio
publication, a weekly newspaper of
the early forties of the last century,
and turned to the quotations on live
stock, dairy, and farm products.
Wheat was 40 cents the bushel, pork
3 rents the pound, gutter 6 cents the
pound, potatoes R41 cents the bushel,
(■i Not many automobiles in returns likff
those. ’
But that was before the age of
motor cars, that was in the flathoat
era, when a cargo of farm products
had to be floated down the Scioto and
Ohio rivers 250 miles to market. The
prices were a reflex of the crudity
of transportation. And manufactured
products were correspondingly high
to the consumer, because there was
the same crudity of transportation in
distribution. The stage coach, the
wagon train, and the flathoat were
speed wonders of that day, and the
canal boat was the last word in lux
ury on many waters.
Missouri Valley Revealed.
1 The great Missouri valley was
then unrevealed, and only awakening
transportation was the revealing
agency. In the Infinite bounty nf the
Creator the measureless riches of the
west were bestowed, but they
availed little until the whistle of the
steam locomotive proclaimed Its
westward march with the star of em
pire.
It Is a curious trait of human na
ture that we acclaimed railroads In
the building and then turned 'o
hamper them in the operation. Mis
souri and Kansas were'-doubtless like
Ohio. We gave from our purses to
contribute to needed building funds,
we donated vast areas for right of
way, we witnessed financial exploita
tion with little protest, because of
our eagerness to acquire, and ac
claimed the acquisition. Marvelous
- development attended, but we omitted
the precautions which would have
avoided many present-day dlfftcul
ties.
Everybody knows how necessary
transportation is in this modern
world of specialized industries and
extensive exchanges. Everybody
knows that our very social scheme,
as now organized, is dependent on
the maintenance of adequate trans
portation media. A good many peo
ple, indeed, have latterly come to
wonder if it might not he possible
even that we have committed our
welfare and prosperity too largely to
the assumption that It would always
be possible to provide all the trans
portation that the community might
desire, at costs which would not be
prohibitive.
That we have even staked our
very existence on the dally continu
ity of transportation. There Is a
new. and I think Increasing, school
of thought on thin subject. Its ad
herents are beginning to ask
whether. In the long run, It would
not be better to attempt making local
communities more nearly self depen
dent by diversifying their range of
production and thus reducing the
amount of trangportatfon and ex
change of products over long dis
tances. But such a course would
be a reversion to the old order,
which no modern community will
ingly would accept, back to the farm
self-contained, back to the restricted
community, with its candle burning
beneath the half bushel measure.
Future Questioned.
Of one thing we may be reasonably
assured, and that is that since rail
roads first began to be built in the
world there never was a time when
so many people, in so many com
munities. were frankly and intelligent
ly questioning the future as regards
its instrumentalities of transport.
They are asking very frankly and
pointedly how they can attain rail
roads enough In the next few gen
erations to supply them, along with
other agencies, with the transporta
tion they will require. I doubt If
there is a country in the world In
which railroads have come to he a
considerable transportation factor
which has not some sort of a railrond
crisis on its hands right now.
There are some countries which
merely need more railroads, and are
willing to pay almost any price to get
them, just as we would have done a
generation or two generations ago.
There are others which have more
railroads than current traffic and in
sistent demand for lower rates makes
profitable, so that they have been
made, in some fashion or other, a
burden on either Industry or the
public treasury. There are still others
which have excellent railroad sys
tems but have found, in the increased
cost of capital and operation which
came with the world war upheaval,
that the cost of 'transportation is
threatening to become too heavy for
the producing industries to bear It.
race Many Difficulties.
Our own country, although it pos
sesses something like 40 per cent of
the world's railroad mileage, is con
fronted with all of these difficulties.
In much of our territory we need
more railroad facilities, and somehow
will have to supply them In the near
future. It Is stated on high authority
thrt the indirect losses In Industry
end commerce due to Insufficient
transportation run into figures equal
to the burdens of federal taxation.
On the other hand there are some
railroads in this country the building
of which would better have been de
ferred, for they were born out of
misguided enthusiasm, or unjustifiable
speculation, or the mere purpose of
levying a sort of transportation black
mail upon systems already In the
field.
Finally, we have many railroads
which, though apparently well man
aged and absolutely necessary to the
communities they serve, are finding
it difficult to earn a living and quite
impossible to provide the necessary
maintenance and the means of ex
panded facilities.
Every passing year adds to the cost
of producing new railroads. Mos.
of our railroads were begun In a time
when land was the most plentiful and
least valuable thing we possessed, and
their rights of way and terminals
cost, as compared with the present ex
pense that would he Involved In re
producing them, very little Indped.
Everybody is doubtless familiar
with the story that a few years ago
a great engineer was commissioned
to make preliminary calculations of
the cost of a complete new trunk line
system between New York nnd Chi
eago. He Is said to have reported
that the purchase of real estate for
terminals on Manhattan Island alone
would require as much capital, as
Would the physical construction of
B EAUTY-—5
IN THE CHARM OF
White Footwear
A varied assortment of white footwear to
choose from. Many new and pleasing models
in fancy glazed kid and Nile cloth.
Pure white, with straps, cutout designs and
other features favored by the discriminating
buyer.
Priced
Reasonably at ipJ/
FRY SHOE CO.
16th and Douglas Streets
the entire line from New York to Chi
cago.
Good Illustration.
There could hardly be a better Illus
tration of the increasing difficulties
which the country must face In any
considerable expansion of its railroad
system. Of course, this hypothetical
new trunk line from Lake Michigan
to the Atlantic coast was not con
structed. If it had been, it could
not have earned returns on Its
enormous cost unless rates had been
greatly Increased for Its henefit. But
If rates had been Increased for It,
they would have had to be Increased
also for the lines competing with It.
Otherwise, the new road would have
no business at all. An Increase of
tariffs which would have permitted
such an expensive new property to
earn even a moderate return on Its
Investment would have ennhled the
older and less expensive properties to
earn absolutely preposterous returns.
It is worth while to bear in mind.
In the face of current agitation, that
we could not replace our railroads
for a vastly larger sum than the
valuation placed upon them by the
Interstate Commerce commission, and
It Is fortunate for our people that we
do not have to contemplate a rate
structure founded upon replacement
cost.
I have referred to the previously
recited Instance because It so per
fectly Illustrates the whole situation
which the country must meet In
dealing with its railroad problem.
Events of the last few years have
made us all realize that the rail
roads must be administered under
some policy that will make It pos
sible to find the capital wherewith
to expand the existing systems as
business shall require, without Im
posing an Impossible burden upon In
dustry and consumption.
No Theoretical Problem.
It Is no theoretical problem. It Is
not an Imaginary thing to be swept
ariKje with the wave of the hand.
When the government undertook
operation during the war, and stan
dardized wages, and was caught In
the sweeping current of mounting
cost. It crented a situation to Ignore
which would quickly develop a na
tional menace. At an awful cost we
learned the extravagance and mount
ing burden of government operation.
Yet there are today very Insistent
advocates of government ownership,
frankly, I do rot share their views.
Our political system has not reached
a state of development when we can
insure proper administration.
I believe It would be a colossal
blunder which - ,'d destroy Initia
tive, infect us ' political corrup
tion. create reg 1 Jealousies, snd
Impose incalrulc e cost on the pub
lic treasury. Bu we mu •_ find a so
lution of the rata problems and the
necessary expan of facilities and
find that solution In spite of the prej
udlees of the present day sponsors
for operations and the present day
destroyers who would bankrupt or
confiscate, else government owner
ship and operation will become an
accepted necessity.
Nor do I share the views of those
who would lower rates without re
gard to railroad good fortune. The
prosperity of the railways Is the
prosperity of the American people,
and the property rights in railway in
vestment are entitled to every con
sideration under our constitution
which Is due to property rights any
where. Any tendency toward confls
cation will lead to confusion and
chaos, and destroy the very founda
tion on which the republic is bullded
Many Kavor I'nlted States Control.
It is easy to understand how many
people contemplate the abolition of
competitive carrying charges, and the
elaborate machinery of government
regulation, and argue that the logical
step is to put them all In one common
pool under government ownership
That would effect an adjustment be
tween the fat and the lean. If it d.dn't
make them all lean. It would equal
ize profits and losses between favored j
lines and the less fortunate ones. It
would abolish profits and saddle ail 1
the losses on the puhllc treasury, j
More, tt would completely disarrange '
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the economic: relationship between
our different communities, upon
which our presentdny commerce Is
bullded. It Is preferable to preserve
Initiative and enterprise, to maintain
the Inspiring competition of service,
and it Is vital that the cost of trans
portation be borne by the commerce
which is served.
No, my countrymen, I am not pro
posing nationalization, nor a renewed
experiment in government operation,
the cost of which we have not yet set
tled. The ftsleral treasury can not
well bear any added burdens until
we have lifted many of those already
imposed. I had rather solve a diffi
culty than embrace a danger.
Sees Possible Solution.
I do believe there is a rational,
justifiable step, full of promise toward
solution. It will effect a diminution
lr. rates without making a net return
Impossible. It will make sound
finance possible for expansion.
I refer to the program of consoli
dating all the railroads Into a small
number of systems, the whole to be
under rigorous government super
vision, and the larger systems to be
so constituted that the weaker and
unprofitable lines would be able to
lean upon the finanelal strength of
the stronger and profitable ones until
the growth of the country makes
them all earn a Just return upon
capital Invested. The transportation
act of 1920, known as the Cummino
Esch law, contemplated this kind of
a consolidation, but made it permis
sive rather than mandatory. In ef
fect, It left to the railroad manage
ments, subject to the master plan set
up by the interstate commerce com
mission, to arrange the system, group
ings of the roads.
That provision was adopted only
after long and detailed consideration
by men of wisdom and experience,
and seemed to represent the best
Judgment of leaders in both political
parties. Its weakness wan that it was
doubtful whether the railroads would
be able, of their own volition, to re
concile all the conflicting interests
involved in Ho enormous a reorgan
ization. It was frankly recognized
when the legislation passed that it
was necessarily somewhat experi
mental. Likewise, it was extremely
uncertain whether the wisdom of a
dozen Solomons, sitting as railroad
presidents and chairmen of boards,
and as financial backers of these
great properties, would be equal to
the task of organizing a group of
Systems which would represent fair
treatment of all the Interests In
volved, including those of the public.
There now appears to be no difficul
ty about any constitutional Inhibition
to the voluntary consolidation as au
thorized by congress. But the prob
lem of reconciling the interests ot
the hundreds of different ownership*
and managements of lines to be
merged into systems has proven a
task for which no solution has been
found.
It is, therefore, being seriously pro
posed that the next step be to fur
ther amplify the provisions for con
solidation so as to stimulate the con
summation. It is my expectation that
legislation to this end will lie brought
l>efore congress at the next session.
Through Its adoption we should take
the longest step which is now feasible
on the way to a solution of our dif
ficult problems of railroad transpor
tation.
There has been undue alarm In
many communities, Kansas City in
cluded, concerning the effect of such
consolidations upon commercial cen
ters like yours. Let me allay the
alarm by reminding you that the
whole question Is one of adjustment,
and the whole program is to be con
structive, looking to enhanced serv
ice, and destruction Is as much to be
avoided as failure is to be prevented.
Though no other nation in the
world offers a parallel In railway de
velopment, those of us who believe
that this program of regional con
solidation would produce highly bene
flolal effects And our belief sustained
by recent experience in Great Bri
tain. The railroads of that country
have, In the last few years, passed
through an experience which, con
sidering the vast, differences between
the two countries as to area, geo
graphic configuration, industrial and
social organization, has more or less
paralleled that of American rallroadH.
The United States and Great Bri
tain were, when the world war
flamed, the only two great countries
which had clung unalterably to pri
vate ownership of railroads.
Results Expensive.
In every other important country
a considerable portion or all of the
railroad mileage was owned or oper
ated by the gov*frnment. In Britain,
as here, the necessities of war per
suaded the government to take over
the roads, place their operation un
der more rigorous control than be
fore. and extend financial guaranties.
In both countries, the results were
expensive from the viewpoint of the
treasury, and highly unsatisfactory
from that of the public's convenience
and the accommodation of business
In both countries, again, the experi
ence went far to dispel whatever 11
lusions had been entertained about
the desirability of government rail
road management.
The parallel does not end here.
When the war ended opinion In both
countries urged return of the rail
inads to corporate management as
soon as possible. In both this was
affected, and—here comes the most
striking coincidence of all—In both
the return was accompanied by a
legislative provision looking to con
solidation of the many systems into
a small group of great ones. The
difference was that in Great Britain
the legislation was mandatory, re
quiring that by January 1, 1323, the'
roads should be consolidated into I
four great systems; here it was per
missive, and, of course, a much lar-^
ger number of systems Is propose!
The British program has been car !
rled into effect; there are now four*
systems in the country, all organized j
around the same geneml Idea of In '
creasing efficiency and providing
their financial stability
While this reorganization has been.
In effect only a few months, its early ;
results are reported to Justify fully
the expectation of better conditions!
under It. It Is regarded as a long !
step toward permanent settlement, on I
a basis fair to the owners of the
properties, and to the public Interest
\ J-u-l-y F-r-o-c-k-s ^
A Riod of Color and Frsnchjr
* Fashions,
h Out of ths hifh rent district. Our
prices are low and alterations frst. -I |
f' f
i RMj
1SI2 Isrtiam
urea,.', I
I
in good service at the lowest pos
sible rates.
The necessity for early adoption of
this or some other program to place
the railroads OB a sound basis ls*so
pressing as to make it a matter of
deop national concern. There is no
other issue of greater Importance, for
herein lies In large part the solution
of the agricultural problem, and with
it the assurance of our industrial
position. Nothing else can possibly^
prosper with agriculture depressed*
and agriculture is calling loudly for
relief from present transportation
burdens.
Quite recently Senator Cummins,
the veteran chairman of the senate
Interstate commerce committee, made
the startling statement that probably
75,000 miles of our railroads are
earning so little and costing so much
to operate that with scant Incomes
they can not be adequately main
talned and expanded In facility to
meet trafic requirements. If we
realise that this means near one-third
of the country's railroad mileage, we
will appreciate the gravity of the sit
uation. Yet there it is. grimly rter
Ing us in the face, challenging our
statesmanship and business capacity.
Not long ago the interstate com
merce commission actually granted
the necessary authorization to tear
up and abandon one piece of over 230
miles of railroad. It was no frontier
line, in an undeveloped, uninhabited
section: it was in the rich and pop
ulous state of Illinois. If the spec
tacle of a railroad literally .starved
to death in such a community !■
alarming It is yet less a calamity in
(Turn to r»re Flight « nlumn One I
Saturday Special
White or Colored
[Shoes]
For Women
*
622 to 1022
In this group there are 35
different styles to select
from; white and
colored shoes in
\ kidskin or elkskin;
on sale from 6.00 to f
10.00. ^
Buster Brown Shoes
New styles for children are now ready for your inspection. Be
low we list a few gpecial items which should interest mothers.
Buster Brown Patent Leather
or Tan Oxfords—F or early
spring wear.
Sixes 6 4 to 11 • . . 4.50
Sixes 114 to 2 ...5.00
Buster Brown Pump*—Tw’O
strap Mary Jane patent leather
vamp with beige quarter.
Sixes 8 4 *o 11 at 4.50
Sixes 114 to 2 at 5.00
Buitcr Brown Calf Oxford.—
For either boys or girls; made
over the foot-shaping last with
welt eoles; in brow-n only.
Si*«. 8’i to 11 H . .3.50
Si**, li h u 2... 4.25
Growing Girl.' .i**., 2’j
»o 7 at .5.00
Third Floor—East
Buster Brown Patent Leather
Cutout Vamp Mary Jane San*
dais—A very pretty dress shoe.
S?zes 8** to 11 at. -4.50
Sizes Ult to 2 it 5.00
Buster Brown Children's Bluch
er Oxfords in Patent Leather—
Brown calfskin or white elk.
Buster Brown Sandala—Effect
for little girls. Sizes 4 to 8, per
| pair . 3.25
I Sizes 4 to 8 at, per pair, 3.25
Please Note:
We believe this sale
to be the greatest in
point of value-gi ng
ever inaugurated by
Orkin Brothers. Its
an event you cannot
afford to miss.
Conant Hotel Building
/ For Saturday
The Most Amazing Offer
Ever Announced by This Store
Suits-Wraps-Capes
Silk Dresses
Your choice from hundreds that
sold up to $65, Saturday at
We appreciate that such a
statement will cause the
V reader to wonder how such
.* value-giving is possible. But
these are Clearance Days and
the transferring of depart
ments makes such price sac
rifices necessary.
Think of buying a beautiful Dress or a
stunning Wrap for only Fifteen Dollars.
That's exactly what this wonderful sale
Saturday permits you to do.
Buy Two or Three Garments at This Ridiculous Price
The $15 Dresses
Gorgeous creations in
models for sport, after
noon and dinner wear.
Modes of the hour. All
the new silks.
The $15 Suits
Majority are tailored
models in Navy, devel
oped from fine Poiret
Twills, richly lined. All
sizes are here.
i
The $15 Wraps
Wraps. Capos and Sport
('oats. Your choice from
our entire stock. Many
suitable for early fall
wear.
k Sale Starts Promptly 9 A. M. Saturday--Be Here Early ;