AMERICANS DOUBT BRITAIN'S ECONOMIC SURVIVAL

Chronicle (Levin), 19 July 1947, Page 4

AMERICANS DOUBT BRITAIN'S ECONOMIC SURVIVAL

^ ■ LONDON. — Steps to nationalise British railways have done probably more than any other single act of the Attlee Government to make Americans doubt the possibility of Britain's economic survival, states Clifford Huline, Washington correspondent of the Daily Graphic, London, in a recent despatch.

JHE very different circumstances of Britain from those of the United States as a result of the war, and many of the restrictions under 'which her economy must operate till normal times return, are well understood and appreciated by American busine^smen. politicians and economistsY" But * their reaction to proposals to nat'ionalise the British railways is a unanimous "why?" They see in it not the slightest advantage or help to Britain or her people, and regard it as a needless complication of her already difficult position, besides taking up the valuable time of her overburdened Parliament and administration. This view is by no means confined to business and political circles. Trade union leaders, prominent among them the heads of the American railroad brotherhood with their 600,000 members, . are equally puzzled. America's own brief but costly ! experience of Government control of railways is fresh in the public memory, and it is not surprising that returned ex-servicemen, when asked recent,ly if they favoured State ownership of the American railways, voted 11 to one against. American' - railways were under complete Government control for 26 months during the period 191820. The experiment demonstrated conclusively that Government operation is inefficient and expensive. Though traffic was at peak and capachw taxed as never before —the very conditions that should make operation profitable — the Government's venture into the railway business cost American taxpayers £404,000,000 or half a million a day. In addition the public paid £4,357,500 more for having their goods moved than they would have done under the private 1916 rates. When Government control ended1 the railways were turned back to their owners in -such a wretched eondition that the Government had to lend £250,000,000 to repair the damage. The huge losses under Government operation hadj so impaired the companies' credit that

they could not borrow from private sources; as they had always been able to do in the past. To restore their credit and enable them to liquidate Government loans the railways were authorised to raise freight rates by an averagje of 30 per cent and passenger ratejs by 20 per cent. Rates thus estabiished as a direct consequence of Government operation were the highest ever known in American railway history. No wonder Americans ask if Government ownership would reduce British railway rates, and no wonder President Roosevelt, a deciared opponent of State ownership of railways, saw to it that America did not repeat her World War I mistake in the last war, but let the railwavs run their own business. They met all demands and came through with flying colours. Railwaymen here do not think their British counterparts will be a whit better off under nationalisation. It could even be detrimental to them in the view of a former president of one big drivers' union. He says: "Under Government ownership employees become Government employees. If they expect thereby to constitute a favoured class, they would be seeking what they have always condemned. Colleetive bargaining- in dealing with the GoV-^ ernment as employer would in cffeet be bargainxng with the entire nation, which would be much less effective than bargaining with a private employer. The power to strike would be virtually gone. Moreover, the fixing of wages and setUement of grievances would be shifted to a political basis." He also made the point that railwaymen in Canada under Government ownership are paid less than privately employed American railwaymen, and often have not shared in their increases of pay: American railwaymen- also recall fchat in the ^history of railwa,y development -r: private companies Have always led the way. . British railways under private ownership Dioneered the block-signalling system, the vacuum brake, and gravity shunting.