THE NATION'S UNDEVELOPED RESOURCES 



193 



the construction of a railroad, which is 

 the essential modern means of transpor- 

 tation. (2) There can be no assurance 

 that without surrendering our resources 

 in Alaska private railroads will be built. 

 (3) The opening of this new country de- 

 mands that the highways of travel and 

 commerce should be made wholly sub- 

 servient not to private interest, but to the 

 upbuilding of this territory, that they 

 may be the real servants of the national 

 purpose. 



If it is thought wise to recoup the 

 government for its original outlay, it can 

 be done, at least in part, by following a 

 plan not unknown to our people — by 

 giving a land subsidy to the owners of 

 the road. Retain in the government one- 

 half of the land on each side of the 

 railroad until it has appreciated in value 

 by the growth of the lands given to the 

 public. Thus the government would sub- 

 sidize itself and reap some of the benefits 

 accruing to its land from the construction 

 of the road. Judging by the increase in 

 land values in the newly opened sections 

 of Canada, who could say but that long 

 before the bonds were due the govern- 

 ment would thus have an asset sufficient 

 to meet the original debt ? 



There seems to me no necessity for 

 Ijarring the way to minor privately owned 

 roads because of the presence of longer 

 systems of publicly owned roads. The 

 two exist together in other countries. I 

 would not even apply the principle of the 

 commodities clause of the act to regulate 

 commerce to such roads. They should 

 be built, however, under governmental su- 

 pervision, capitalized and operated under 

 the strictest regulation, and be at any 

 time subject to purchase by the govern- 

 ment at their cost, minus depreciation. 



TH^ VAIvUK OF ALASKAN COAL 



It is not necessary to set forth here the 

 extent or character of the coal fields of 

 Alaska. Neither could I add to your 

 knowledge or that of Congress as to the 

 need for this coal both by the navy and 

 by the industries and the people of the 

 Pacific coast generally. There are almost 

 unlimited quantities of a high grade of 

 lignite in the interior which may not 

 stand extended storage or transportation. 



This could be converted into electricity 

 at the mouth of the mines and widely 

 distributed for lighting, heat, and power. 

 Toward the southern coast of the penin- 

 sula there are two well-known fields of 

 a high-grade bituminous coal and some 

 anthracite. These are the fields which 

 have given rise to the troubles with which 

 all are familiar. 



These coal fields should be opened not 

 to speculators, but to operators. Those 

 should have these lands who will use 

 them. None should be opened as a basis 

 for a gamble in future values. If these 

 premises express a sound public policy, 

 there appears to me but one conclusion 

 that can be reached as to the manner in 

 which they may safely be turned over to 

 the public — under a leasing and royalty 

 system similar to that under which the 

 State of Minnesota leases its ore lands 

 and the States of Montana and Colorado 

 their coal lands. 



The tracts opened should be disposed 

 of to those who within a certain time 

 would develop mines and make their 

 product commercially available. This 

 means that where a railroad is necessary 

 to the operation of a mine the applicant 

 should take a lease so conditioned for a 

 limited period. Sufficient land should be 

 leased as a body to justify long-continued 

 and economical operation. As the aver- 

 age of all operations in the United States 

 is 2,600 acres, including many small hold- 

 ings, this might be taken as a maximum 

 unit. 



There has been much dispute between 

 those who favor making a lease for an 

 indeterminate period, dependent alone 

 upon continued operation, and those who 

 believe it wisest to fix a term for the 

 lease, 20, 30, or more years. This dis- 

 pute seems to me of much more academic 

 than practical interest. There should be 

 no disposition to change the lessee. If a 

 fixed term of lease is decided upon, the 

 original lease should have an assured 

 preferential right to a renewal until the 

 mine is worked out. So that in the end 

 the fixed term is a reservation of the 

 right on the part of the government to 

 make new terms at the end of a number 

 of years, a reservation which could be 

 fixed in an indeterminate lease. 



