The Black Dispatch (Oklahoma City, Okla.), Vol. 4, No. 50, Ed. 1 Friday, January 4, 1918 Page: 2 of 8
This newspaper is part of the collection entitled: Oklahoma Digital Newspaper Program and was provided to The Gateway to Oklahoma History by the Oklahoma Historical Society.
Extracted Text
The following text was automatically extracted from the image on this page using optical character recognition software:
THE BLACK DISPATCH
Names McAdoo as Director Gen-
eral for All Lines in
United States.
EARNINGS TO BE GUARANTEED
Action, Which Affects Also Coastwise,
Like and River Steamship Prop-
erties, Taken as a War
Measure.
Washington.—President Wilson,
Under Ills war powers, has
•iiiiiikI possession and control of nil
the railroads and steamship lines with
In the United States.
The president Issued n proclnmn
Won Invoking his wnr authority to
take over the railroads nnd appoint-
ing Secretnry of the Treasury McAdoo
to the position of director general of
railways.
Mr. McAdoo will remain secretary
•f the treasury, nnd In his dual role
will ho the most powerful official In
the nation except the president.
The railroads will continue to he
operated by their respective corpora-
tions under the direction of Mr.
McAdoo, nnd the primary function of
the lines will become the transporta-
tion of troops nnd wnr supplies and
materials, to which all other service
will be subordinated.
Properties Which Are Taken.
The properties that will pass Into
the control of the government nre:
All railroads, comprising 2(10,000
miles of lines, valued at $17,000,000,-
000.
All coastwise, lake nnd river steam-
ship lines.
All terminals, terminal companies,
■nd terminal associations.
The Pullman company's sleeping
cars and parlor cars.
The packers' and other concerns' pri-
vate car lines.
All railroad elevators nnd ware-
houses.
All railroad telegraph and telephone
lines.
All Interurbnn electric lines enrry-
Ing frelgh' only.
Street Car Lines Exempt.
The president will not tnke over at
this time any street car or local pas-
senger carrying Interurbnn electric
but he provides In bis praclnma-
nt by subsequent order he mny
9SSesslon of nny such lines
Jdesirable, Including subwnys
linnets.
The proclamation does not specific-
ally mention express compnnlcs, but
the language of tho proclamation, In
which there nppear the words, "und
■11 other equipment and appurtenances
commonly used upon or operated as a
part of such system," would seem to
Include these companies.
Guarantee of Fair Profit.
The government guarantees to the
Stockholders of each of the railroads
a profit equal nt least to the average
profits of the road during the fiscal
years of 1015, 1010 and 1017.
Taking nil of the ronds of the coun-
try ns a bnsls, the general average wns
5.21 per cent on their total capital In-
vestment.
The president says thnt he will
ask congress to provide for the guar-
antee of pre-war earnings to the own-
ers of the properties, and he qjlds:
"Investors In railway securities
mny rest assured thnt their rights nnd
Interests will be as scrupulously looked
nfter by the government as they could
be by the several rnllwny systems."
McAdoo to Negotiate.
Director General McAdoo Is instruct-
ed to negotiate with the railroads im-
mediately agreements providing for a
compensation to the owners of the
properties amounting to the average
net profit derived by each company
(luring the three-year pre-war period,
these agreements to bo submitted to
the president for action in connection
with the legislation asked of congress.
Bondholders nnd other security hold-
ers nre to receive the same return on
their Investment they received during
the pre-war period and other creditors
are to receive their due with rights
unimpaired.
The president takes possession of
the railroads by executive order under
ths authority conferred upon him by h
provision of the army appropriation act
of August 20, 1016, which follows:
"The president in time of war Is em-
powered. through the secretary of war,
to take possession and assume control
of any system or systems of transpor-
tation. or any part thereof, and to
utilize the same, to the exclusion, as
far as may be necessary, of all other
traffic thereon, for the transfer or
transportation of troops, war material
and equipment, or for such other pur-
poses connected with emergency as
may be needful or desirable."
Cut In Passenger Traffic.
The government will be required to
provide the railroads with approxi-
mately $1,000,000,000. It Is estimated,
for the expansion and building of new
terminals, extensions of trackage and
additional rolling stock.
Government control will also entail
a general shifting of rolling stock to
the centers of war Industry to relieve
the congestion of transportation of war
materials. Hundreds of engines and
thousands of cars will be sent from
western and southern roads to eastern
tecri.ory. where 80 per cent of the
war supplies are being produced.
Passenger traffic la scheduled to be
greatly curtailed. On western roads
THE PRESIDENT'S STATEMENT
"A Great National Necessity Dictated the Action. I Was Not
at Liberty to Abstain From It." •
By WOODROW WIL80N.
I hsve exercised the powers over the transportation systems of the
country which were granted me by the set of congress of August, 1918,
because It has become Imperatively necessary for me to do so. This Is a
war of resources no less than of men, perhaps even more than of men,
and It Is necessary for the complete mobilization of our resources that
the transportation system of the country should be organized and em-
ployed under a single authority and a Simplified method of co-ordination
which have not proved possible under private management and control.
The committee of railway executivea who have been co-operating
with the government In this sll Important matter have done the utmost
that It was possible for them to do; have done it with patriotic zeal and
with great ability; but there were difficulties that they could neither
escape nor neutralize. Complete unity of administration In the present
circumstances Involves upon occasion and at many points a serious dislo-
cation of earnings, and the committee was, of course, without power or
suthorlty to rearrange chargea or effect proper compensations and adjust-
ments of earnings.
Several roads which were willingly and with admirable public spirit
accepting the orders of the committee have already suffered from these
circumstances and should not be required te suffer further. In mere
fairness to them the full authority of the government must be substituted.
The government Itself will thereby gain an Immsnse Increase of efficiency
In the conduct of the war and of the Innumerable activities upon which
Its successful conduct depends.
The public Interest must be first served, and In addition the financial
Interests of the government and the flnanolal interests of the railroads
must be brought under a common direction. The financial operations of
the railways need not, then, Interfere with the borrowings of the govern-
ment, and they themselves can be conducted at a greater advantage.
Investors In railway securities may rest assured that their rights and
Interests will be as scrupulously looked after by the government as they
could be by the directors of the several railway aystems. Immediately
upon the reassembling of congress I shsll recommend that these definite
guarantees be given: First, of osurse, that the railway properties will
be maintained during the period of federal control In as good repair and
as complete equipment as when taken over by tho government; and,
second, that the roads shall receive a net operating Inoome equal in each
case to the average net Income of the three years preceding June 30,
1917; and I am entirely confident that the congress will be disposed In
this case, as In others, to see that Justice la done and full aecurity assured
to the owners and creditors of the great systems which the government
must now use under Its own direction or else suffer serious embarrass-
ment.
The secretary of war and I are agreed that, all the circumstances
being taken into consideration, the best results can be obtained under the
Immediate executive direction of William G. McAdoo, whose practical
experience peculiarly fits him for the service and whose authority as sec-
retary of the treasury will enable him to co-ordinate as no other man
could the many financial Interests which will be Involved and which
might, unless systematically directed, suffer very embarrassing entangle-
ments.
The government of the United 8tates Is the only great government
now engaged In the war which has not already aasumed control of this
sort. It was thought to be in the spirit of American institutions to at-
tempt to do anything that was necessary through private management,
and if zeal and ability and patriotic motive could have accomplished the
necessary unification of administration It would certainly have been
accomplished; but no zeal or ability could overcome Insuperable obstacles,
and I have deemed It my duty to recognize that fact In all candor, now
that It Is demonstrated, and to use without reserve the great authority
reposed in me. A great national necessity dictated the action and I was
therefore not at liberty to abstain from It
this curtailment will be marked. Com-
petition In passenger traffic between
Chicago nnd St. Paul und Chicago and
the Pacific coast, for example, will Be
abolished, This will mean the with-
drawal of many trains.
Why Course Was Taken.
In a statement accompanying the
proclamation President Wilson says
that he takes this radical action "be-
cause It has become Imperatively
necessory for me to do so." In order
to mobilize In the shortest possible
Ime oil the material resources of the
nation for the conduct of the war the
railroads, says the president, must be
organized, co-ordinated, nnd employed
under a single authority.
The attempt of the rnllroads them-
selves to provide this single authority
nnd simplified organization In the ex-
isting railroads' wnr board and Its
special operating committee has
proved a failure because of physical
limitations, although the president
pays high tribute to the ability and
zenl of the five rail executives whose
efforts have been devoted to the task.
The organization effected by the
railroads' wnr board will be the foun-
dation upon which Director General
McAdoo will build the structure of
government control. It is not unlike-
ly that some, If not all of the members
of the war board, will be associated
with Mr. McAdoo In admlnisteriug the
management of the unified lines.
In his statement the president refers
to the defects of the system of unifica-
tion uttempted under private control.
Several railroads have suffered finan-
cially and physically from carrying
out the orders of the war board, which
required them to be utilized in ex-
tremely unprofitable transportation In
order that the transportation of war
materials might be facilitated.
Need Fear No Losses.
Under governmeat coutrol no rail-
roud will incur such losses. The rail-
roads will not be interested in what
lass of traffic they handle, will not
care whether it Is profitable or unprof-
itable. If it is unprofitable the loss
111 be made good by the government,
for the government assures the stock-
holders the return on their Investment
they enjoyed (ou the annual average)
for the three years ended June 30,
1017.
Under government control the rail-
roads are to be assisted in obtaining
the capital necessary to finance the
vast extensions of trackage and ter-
minals and the building of additional
locomotives and cars made imperative
by the demands of war.
The president says that under gov-
ernment control "the fluanclal earn-
ing* of the railways need not then In-
terfere with the borrowings of the gov-
ernment." Railroad Investments are
to be made attractive to investors by
the government guarantee. Eventu-
ally a loan may be made by the gov-
ernment to the railroads.
It Is said, however. In the selection
«f Mr. McAdoo for director general of
~allroad* that there lies tho greatest
promise of government .assistance to
the railroads In licencing their opera
tlons and extensions.
SALVATION ARMY WORKERS READY TO LEAVE FOR FRANCE
I
A group of Suivution Army workers photographed at the New York headquarters ready to leave for service with
the American army In France. They will aid the soldiers in many ways, from holding religious services to writing lov
letters to the girl back home. The women members of the party will repair the clothes of the boys when not otherwlw-
engaged.
GERMAN BOMBING PARTY BEING DRIVEN BACK BY THE FRENCH
Whllo Mr. McAdoo will not relin-
quish his post as head of the treasury
department he will he compelled ">o
turn over to others most of the routine
business of the depnrtment to which
nt present he Is giving his personnl
nttentlon. Of course he will hnve a
number of capable nsslstnnts to re-
lieve him of some of the responsibility
connected with the duties he will short-
ly assume.
No Limit to Powers.
In his proclamation the president
confers upon Mr. McAdoo powers thnt
will be practically unlimited when he
enters upon the direction of the rail-
ways and can be limited subsequent1
ly only by the president or by con
gress.
In the first place, Mr. McAdoo Is au-
thorlzed to control and direct the rail-
ways under private operation by
existing directors, receivers and offi-
cers "so k>ng and to such extent as
he may determine." The railroad offi-
cials are Informed In the proclama-
tion thnt they will continue the opera-
tion of the properties "until nnd except
so far as said director shall from time
to time by general or special orders
provide."
Mr. McAdoo will hnve power to dis-
charge existing directors nnd other of-
ficials and appointed new ones. How-
ever, It Is expected that generally the
executive forces of the various ronds
will continue In their offices. In fact,
there Is supposed to be no one else
avn liable for these Jobs, from presi-
dents down.
Can Decide on Rates.
The director general is to wield au-
thority paramount to thnt of the Inter-
state commerce commission and .state
rollway commissions. The statutes
and orders of these bodies are to re-
main binding upon the rnllronds only
so long ns Mr. McAdoo approves.
When he decides that rates should
be revised upward or downward, or
thnt national or stnte regulations
should be charged, all he will have to
do Is to Issue an order putting the
change Into effect, and that order, un-
der the president's proclamation, "shall
hnve paramount authority and be obey-
ed as such."
The regular dividends hitherto de-
clared and the Interest upon bonds and
other obligations are to be paid as
usual, unless Mr. McAdoo should de-
termine otherwise, but all renewals
and extensions of maturing obliga-
tions can be made by the roads only
with the approval of the director gen-
eral.
Why McAdoo Was Chosen.
The president says he and Secretary
of War Baker, In who* name the ex-
ecutive takea possession of the lines,
are agreed that existing circumstances
make inlrlsable the appointment of Mr.
McAdoo. "whose practical experience
peculiarly fits him for the service and
who^e authority as secretary of the
treasury will enable him to co-ordinate;
a« no other man could, the many finan-
cial Interests which will be involved
tnd which might, unless systemat-
ically directed, suffer embarrassing ts-
tsngienu-nts."
- m
-v ./
| V ■ ' • V- ' • ,w
This photograph, taken by a German officer who deserted and fled to Holluud, shows a German bombing party
being driven back by French mitrailleuse flro and trying to gain the shelter of the shell crater In the foreground.
Five of the seven have been shot down.
GERMAN AIRPLANE ABLAZE IN MIDAIR
WHITE HOUSE SERVICE FLAGS
I -ft**
I : - i f 3
This wonderful picture of a Boche plane blazing In midair ns it hurtled
downward is one of the most remarkable photographs made In the wnr. The
German battleplane wns flying nbove the lines "somewhere In France," when
a French airman got directly overhead. lie dropped a bomb, hitting the Boche
machine squarely in the middle. It fell a flaming mass as this photograph
was made.
EMPEROR OF AUSTRIA REVIEWING TROOPS
Hard on the Guide.
One of the guides in Glacier Nntlonal
Park, says Outing, is, or was, named
Mike Shannon. He was born with the
usual Irish sense of humor, but there
are some tourist vagaries that nre be-
yond the runge of even his generous
comprehension.
Once upon a time he guided a nature-
loving lady of more than generous
physical proportions. Mounting her
horse nnd dismounting wns a task that
taxed all her powers and Incidentally
most of Mike's as well.
At a particularly bad place In the
trail a majestic pine towered from the
steep slope. As they rounded the turn
the lady tourist called to Mike:
"Mr. Guide, help me down I"
With some difficulty the feat was so
compllshed. She panted up to the foot
of the tre . There she stood gazing
upward for a moment, and then la s
loud, clear voice called out:
"Oh tree. I salute thee!"
Then she went back to the horse.
"Mr. Guide, help me up!"
They accomplished the mounting
with a hundred per cent Increase In
effort, and moved forward.
"What did you say, Mike?" another
guide Inquired when Mike told the
story later.
Rniperor Charles of Austria-Hungary Is here seen reviewing some of the ; "Me? said Mike. "Nothing: but 1
troops that took part in the drive Into Italy and praising the oli!cers for their | J"5* thought I d hate to be tt.e feller
work. This U the first photograph of the emperor to reach America In many i ° h<>r trough the California
mom*. redwoods."—Youths Companion
Little Ellen Wilson McAdoo, daugh-
ter of Secretnry nnd Mrs. McAdoo and
granddaughter of President Wilson,
hanging a Red Cross service flag In a
window of the White House. The flag
indicates that three members of the
executive's household have Joined ths
Red Cross.
Upcoming Pages
Here’s what’s next.
Search Inside
This issue can be searched. Note: Results may vary based on the legibility of text within the document.
Tools / Downloads
Get a copy of this page or view the extracted text.
Citing and Sharing
Basic information for referencing this web page. We also provide extended guidance on usage rights, references, copying or embedding.
Reference the current page of this Newspaper.
Dunjee, Roscoe. The Black Dispatch (Oklahoma City, Okla.), Vol. 4, No. 50, Ed. 1 Friday, January 4, 1918, newspaper, January 4, 1918; (https://gateway.okhistory.org/ark:/67531/metadc152062/m1/2/: accessed March 19, 2024), The Gateway to Oklahoma History, https://gateway.okhistory.org; crediting Oklahoma Historical Society.