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Depreciated Currency and Diminished Railway Rates (Classic Reprint)

Depreciated Currency and Diminished Railway Rates (Classic Reprint)

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Excerpt from Depreciated Currency and Diminished Railway Rates

During the summer of 1908 the daily press gave currency to rumors that the railways of the United States were considering a general revision of their schedules of freight rates with a view to obtaining increased revenue. Accompanying these reports were statements that the augmented cost of conducting the business of supplying railway transportation had made increased revenue absolutely necessary if wages were to be maintained at the existing level and interest obligations met. It was alleged that railway labor was costing vastly more than formerly, that locomotives, cars, rails, fuel, supplies and materials of all kinds, had increased greatly in cost and that while these changes had been in progress railway rates had remained substantially stationary or had, upon the average, declined.

The meaning of these statements, if they could be accepted as accurate, was clearly that there had been a material decline in the value of the money received by the railways which, not having been offset by a corresponding increase in the sums received for particular services, amounted to a genuine decline in railway rates. Further, it was plain, that if such a decline had taken place and had proceeded so far as to endanger the current wages of railway employees or to render doubtful the ability to earn interest on bonds or a fair return to investors, the employees of the railways and owners of railway property were justly entitled to such nominal increases in rates as would, in part at least, offset the real reductions.

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