Uncle Dan's 2t

Since 1926, the trend of U. S. railroad passenger revenues (11% of total revenues) has been down. For a decade the Eastern roads made little attempt to stop it. Fares remained at the 3.6-c--per-mile level set in pre-bus, pre-depression days.

In 1936, tired of waiting for railroad action, ICC ordered the Eastern roads to cut rates to 2-c-. Passenger revenues (like business in general) rose. In 1938, the Eastern roads got 18 months' relief from the 2-c- rate, went to 2 1/2-c- for an experiment. Passenger revenues (like business in general) fell. To complicate the experiment, the roads interrupted it with lower World's Fair rates, sliding scale round-trip fares, etc. Result: at the end of the 18 months their experience with rates and revenues could be used to prove anything, but could prove nothing conclusively.

Last month the roads went before the ICC in Washington and asked for a seven-month extension of the 2 1/2-c- fare, to complete their research (TIME, Jan. 15). Last week the Commission shouted a 7-to-3 no, ordered them to go back to 2-c- March 24.

For Baltimore & Ohio's old (79) Daniel Willard, only Eastern railroad president in favor of really low rates, this decision was a personal triumph. The Commission's argument was right out of his mouth--that high rates subsidize bus competition, that low rates end up by increasing total revenues.

Presidents of the other roads (New York Central's Williamson, Pennsylvania's Clement), who can see no sense in risking their much larger revenues in the difficult game of getting more traffic, were peeved at the decision. But, oddly enough, they were no more peeved than the big Eastern bus lines, which get most of their business from undercutting train rates, may need to lower their own fares.

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