Railroad Consolidation

It is a curious result of the trend of affairs, that official Washington, which ten years ago was violently opposed to railroad consolidations, is now the first to urge them upon the railroad companies. Senator Cummins of Iowa, ranking member of the Interstate Commerce Committee and one of the authors of the present Transportation Act, has introduced a bill to stimulate voluntary railway consolidations. Provided that a proposed consolidation was approved by the Interstate Commerce Commission, Senator Cummins' bill would permit it to be carried out, despite the law or the order of any State. Such consolidated systems, according to his plan, are also to be allowed a Federal instead of a State charter. In addition, the I. C. C. is directed to adopt "as soon as practicable" a consolidation plan for all the railroads.

The bill, therefore, amounts to a statement to the roads, "Consolidate, or we will consolidate you ourselves." Some systems, notably that of the Van Sweringens, have already taken advantage of the friendly attitude of Congress toward consolidations, to absorb new lines. But now the most likely small roads have been largely snapped up, although some still remain. There is, for example, the story in Wall Street that the Southern Pacific might take over the Rock Island. At any rate, many roads remain that are not greatly desired, except as a means to avoid presenting excess railway earnings to the Government.

The test of this proposed compulsory consolidation program will come when the decision has to be made as to who will get the New Haven, the Great Western or the Western Maryland.