382 TWENTY-THIRD ANNUAL YEAR BOOK— PART V 



that they ought to be working together. They ought to turn these fel- 

 lows out of Congress that see everything through Standard Oil and rail- 

 road spectacles. 



PUBLIC INTEREST AND RAILROAD VALUATION 



BY DWIGHT N. LEWIS 



Member Iowa Railway Commission 



There has been much said about the Esch-Cummins law. Several 

 things in the law need amendment, and it is my opinion that, sooner or 

 later, Congress will enact those amendments. There has been much 

 hue and cry that the powers of State commissions have been taken from 

 them. It did look that way for a long time, and our friends of the 

 Interstate Commerce Commission seemed to be obsessed with that very 

 thought. The passage of the law upon which they based their assump- 

 tion should be cleared up, and I have already seen an amendment pro- 

 posed by Senator Cummins that will clear it up. But today there is little 

 or no conflict of authority between the Interstate Commerce Commission 

 and the various State commissions, ana we are functioning exactly as 

 we did before the war. 



We have materially reduced the Iowa Intrastate coal rates, as well as 

 the rates on sand, gravel, crushed stone and other road and commercial 

 building materials, and we have on our docket for hearing the rates with- 

 in Iowa on grain and its products, and brick and tile. The railroad com- 

 panies have promptly put our reduced rates into effect. We are still 

 making orders relative to train service, station conditions, elevator sites, 

 distribution of cars, etc., etc. In fact we are functioning 100 per cent. 



Not Easy to Fix Valuations 



You have heard of the so-called guaranty clause of the Esch-Cummins 

 Law. The rate of return provided in Section 15-A was not a guaranty, 

 but a direction to the Interstate Commerce Commission to fix such 

 rates as would until March 1, 1922, in their judgment, make a return of 

 5V 2 per cent of the value of the railroad property used in transportation. 

 Not upon capital stock, dry or watered, nor upon bonds, nor debentures, 

 nor anything else, save and excepting the value, not of all of the rail- 

 road property, but of that property belonging to the railroad company 

 used in transportation service. 



In endeavoring to arrive at the valuation the Interstate Commerce 

 Commission was besought by the railroad companies to make such valua- 

 tion about twenty billion dollars. Some shipping interests thought six- 

 teen billion would be about right. The Interstate Commerce Commission 

 practically ignored representations made by interested parties, and fell 

 back upon their own valuation work, so I have been informed, and made 

 such deductions therefrom as they believed warranted them in fixing a 

 tentative valuation of eighteen billion nine hundred million dollars. 



Nobody has claimed that these figures are accurate, least of all the 

 Interstate Commerce Commission, but the best they could do under the 

 circumstances. When the valuation work has been completed, and, 



