Labor's Interest in Railroad Reorganization

Abstract

There is no group of our citizenry that is not directly and vitally affected by the problem of railroad reorganization. The railroads now in the hands of the courts have a total capitalization of almost $6,ooo,ooooo000. The entire national transportation system and, with it, hundreds of thousands of security holders, shippers, and millions of consumers of goods transported by the railroads are affected. When we consider that, in industries other than the railroad industry, there are only about 577 bankruptcy cases1 arising under Chapter io of the Bankruptcy Act, of which only some 43 insolvent companies have a debt of as much as $i,ooo,ooo each, and the total assets in all of the cases aggregate only about $385,ooo,ooo, as compared with the book assets of 15 or 20 times as much in the case of railroads in receivership and under Section 77 of the Bankruptcy Act, it can be seen that railroad reorganization presents a problem that requires special consideration and treatment. The widespread effect of the problem of railroads in receivership may best be described by quoting from the report on S. i869, the Railroad Reorganization Bill, submitted by Senator Burton K. Wheeler, Chairman of the Senate Committee on Interstate Commerce: