Lifesaver

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With labor and material costs rising and revenues dropping since V-J day, railroads have been struggling to keep their heads above water. Last week the Interstate Commerce Commission threw them a lifesaver: a 6% increase in freight rates, effective July 1—except for certain basic commodities such as products of agriculture, slag, gravel, etc. on which the boost was only 3%. To make up for their lower rate of earnings, Eastern railroads were allowed a further increase of 5% on all but anthracite and bituminous coal, lignite and iron ore.

The roads had asked for a 25% hike, told ICC that they stood to lose $345,000,000 this year if they did not get it (TIME, April 29). But ICC estimated that the roads needed only 6% more to net another $390,000,000 a year, more than enough to keep them in the black. And the new rates, said ICC, are only temporary. The roads will still be given a chance to present their case for higher permanent rates.