that state for the formation of rates for fireproof buildings and contents. Some knowledge of premiums and losses in this class of property is clearly essential for the making of reasonable rates.

WHAT WAS ASKED OF COMPANIES.

The companies were first asked by the Insurance Department of Missouri to furnish their experience in fireproof buildings and contents. Companies like the Aetna, Hartford, Home and Royal replied that they had never kept a tabulation of this nature and were unable to furnish any information which would show what premiums and losses might be expected from such property. It was explained by these companies that it was their custom, in keeping track of bakeries, for example, to class together those of ordinary construction, improved construction and fireproof construction.

No useful information could be gleaned from such a source, and the experts who prepared the schedule were called to the witness stand and requested to justify their handiwork. It appeared on examination, however, that the provisions of this schedule were prepared without one iota of information showing what premiums and losses had been experienced in this class of property. It was not known whether the rates formerly used had proved unduly profitable or unprofitable, nor was it known with certainty whether the new rates would increase or diminish the premium charge as a whole.

All classes of property receive this arbitrary treatment. In none are statistics kept to show whether the schedule is producing too much. or too little revenue in comparison with the losses. It is admitted that many lasses pay too much, while others are being carried at a loss, but no schedule is made to rectify this abuse, although the schedule purports to be a system of measurement.

The companies do not keep faith with the public. We are promised that greater care to avoid fire will reduce the loss and lead to lower rates. But the rating system is conducted so that the public will neither know its just due nor receive it, except by resort to other forms of insurance. When some organized industry undertakes self-insurance, ratemakers soon find that conditions have improved and that reductions are in order.

It is evident, however, that the end of this system of false measurement is near. Four states are regulating rates under laws which call for rates in reasonable relation to losses, and the sustaining of the constitutionality of such regulation by the lower courts makes similar legislation certain in practically all states. There is urgent need, therefore, for accurate knowledge on all matters which affect the rate of burning in the several classes of property. This knowledge does not exist. It must be acquired by study of data yet to be gathered. The data in the hands of the companies is worthless. It has been gathered by plain business

men engaged in the insurance business, and, whatever the purpose of the compilation, it certainly has had no reference to the formation of reasonable rates.

NEED FOR FEDERAL INVESTIGATION.

Faulty treatment, and not incurability, is indicated by the persistence of the high level of destruction by fire in this country. The treatment is vague and characterized by irresponsibility. Diagnosis is wholly lacking; the location of the trouble is not known, and the remedies are applied haphazard in ignorance of the possible effect. No person connected with the treatment has a definite result to produce, or is even asked to prove that any result has been produced. The premiums and losses are reported in bulk to each state. The summation of these reports into one huge total constitutes all that is done by the insurance company or the insurance rater or the public to discover the workings of this great

waste.

Such blind methods can accomplish nothing. Risks must be enumerated. Those in need of treatment must be singled out and something economically appropriate be prescribed for each. To find out where and how effort can be put forth to economic advantage-to define what can be done wisely by the class and individual to reach the low economic level of loss-to keep watch of results and register the efficiencies of fire alarms, fire patrols, fire departments and fire resistants-these are details which must be wrought out before fire waste can be attacked with definite aim and for the perfecting of which the Federal investigation and bureau is proposed.

The states appeal to the Federal Government to standardize the schedule for the formation of rates so that it shall become a true measure of the conditions to which it is applied. Leaving this measurement to the dictates of the "best underwriting judgment" has proved a costly error to the people. The underwriter escapes the common lot; the cost of his "error," with a substantial addition for his profit, is borne by the people.

When the fog that envelops this waste shall become dispersed by the Federal analysis, the way to its speedy removal will become clearly visible to the individual states.

I lay no claim to originality in the presentation of this subject. I have given you facts and for the most part the comparisons and expressions of the experts who compiled these facts. They are original only in the sense that the testimony of witnesses recited in a brief or argument in a trial are original.

I have asked the assistance of the Congress of the United States to secure an investigation of this important subject to the end that power may be added to the arms of the states to restore natural conditions as to fire losses in our modern business world.

President WALLACE-You will now hear the great highway engineer of Missouri, Hon. Curtis Hill, on the subject of how good roads help. the farmer.

Mr. HILL-Mr. Chairman, Ladies and Gentlemen: There is no question but that we have been making as much progress in road work during the last few years as we have and as we are in other lines of work, and still in many places we are not making the progress that we road-making enthusiasts, and I might say road cranks, would like to see made. Still I do not believe that we can now apply to our highways over the large part of the Mississippi and Missouri valleys that little poem which, or a few verses of which, Robert Burns is said to have written upon his arrival at a little town in Scotland, illustrating that the highways of Scotland at one time were not much better than they are today of Missouri, I might say. Speaking of those highways, he left two verses, which run something like this:

I am now arrived, thanks to the gods,

Over pathways rough and muddy;

A certain sign that making roads

Is not these people's study.

And though I am not with Scripture crammed.

I am sure the Bible says

That you people shall be damned

Unless you mend your ways.

Now, how good roads help the farmer must always include others, and it can be best discussed in a short discussion, in a general way under two heads. First, transportation systems, and the importance of our social conditions. Referring to Bobert Burns in Scotland, you will see that the road question has been hammered upon for years and years. Man has been considering it as a means, and as one means of transportation. Now, in fact man has been forever trying to overcome gravitation, from the first load that a man carried on his back, or put upon the back of a pack animal, he has been endeavoring to lighten his burdens by overcoming the laws of gravitation. And so it has been through all history. The galley, the sail boat, the steamship, automobile, and airship. The good roads is one line in the endeavor to overcome the laws of gravitation and to make easier one method of transportation. Transportation charges have entered more into the cost of living than any other one item. Food, clothing, building material, all the staple necessities of life have had to pay the freight. The freight is deducted from or added to the price of the article which forms the basis of the price which the producer receives or the consumer pays. The man who produces the commodity, or he who settles the bill, pays the freight. Neither the producer nor the consumer has gained by a high cost of transportation. The question of good roads is therefore at the present time one. of the most vital with which we have to deal. There is no one internal improvement so absolutely necessary and essential to a state's progress and prosperity as the betterment of the highways. (Applause) Good

highways are necessary to a state's progress and prosperity, as well as that of a community, because they involve the transportation problem. With transportation is involved the problem of life, the cost and pleasures of living, exchange of commodities, valuation of property and the social and moral and educational conditions. The problem of life is a study closely linked with the problem of transportation.

Our very existence as a social and commercial body as a state is dependent upon transportation to such an extent that without easy, quick and economic means of transportation we must rank as a second, third or fourth class state. The greatest assets of the most substantial nations are transportation and agriculture, neither one of which can be fully developed without the other. The transportation of the bulk of agricultural shipments begins at the farm when the raw material is hauled over the country roads. This country road is the farmer's own road, which leads to the collecting points of transportation by rail and water, and over which he reaches his market. It is used one hundred times to every other time for all other means of transportation. The good road permits the farmer to watch his markets and not the road. Many a farmer markets his grain at harvest time because it is a season of good roads, at a less price than he would by storing the grain until the markets are better and less glutted, and when he would have more leisure time for hauling it to the market. The good road permits him to haul double the load that he would over a poor one, and he is thus enabled to move his crop in one-half the time. This, figuratively speaking, picks up the producer and sets him down one-half the distance closer to his market. You all know that distance in this age is measured in time and not in miles. The country road is the people's own road, their own means of transportation, and it is the only transportation system that is owned, operated and controlled by the people themselves.

It is at the same time the most neglected system of transportation in the United States, and the most expensive over which to transport our produce, owing largely to this neglect. Many a pound of freight originating upon a farm, or destined to a farm, moves over a common country road at a cost three times as high as it would be if the road were first class. Often the haul between the farm and the railroad costs more than the remainder of the journey, and the railroad or any other means of rail transportation cannot be expected to reach every man's farm, and it becomes necessary to provide means for transporting the commodities to the railroad. The wagon road then becomes a system of transportation, just as a line of boats or a railroad is a system of transportation. Water and rail are the means for long distance transportation; highways for local exchange. The highway serves the purpose for local transportation, and is a connecting link for local traffic with the railroads. The condition of this connecting link or highway. may make transportation reasonable or costly. Too frequently, as I said before, the haul over the highway is the most expensive part of

farm transportation. It requires a tractive force of 125 pounds per ton upon an ordinary country earth road, and only sixty pounds upon a rock road. The cost of transportation by water and rail seldom exceeds one cent per ton mile. That upon a good road is from seven to ten cents per ton mile. Upon our ordinary country highway, half kept roads, it is from twenty cents up to anything, depending upon the condition of the road. The railroad will haul a bushel of your grain thirty miles as cheaply as the farmer can bring it one mile. If the farmer is situated. a few miles out of town on poor roads, the railroads will haul the produce and the commodities to cities like Kansas City rather, and the return merchandise from that city as cheaply as the farmer can haul it to and from the railroad and to the farm. Now this high cost of transportation can be decreased by increasing the size of the load. This can be done by improving the road surface. The high cost of transportation is not altogether due to the railroad. Good wagon roads are just as important a factor in the reduction of this high cost of transportation as are low rates by water or rail.

By social conditions, in my opening remarks, I meant the pleasures of community life, the exchange of visits and social courtesies, neighborhood gatherings, social association, fellowship, and the home, the school and the church. The roads should be built for some of the pleasures and comforts of life as well as for their pecuniary interest. It has been said that the pecuniary benefits of good roads sink into insignificance when compared with their social, moral and educational advantages. Man after all is only a social being, and is influenced by his surroundings. The maintenance of a seat of learning, or of a good church in and by a neighborhood has its influence upon the people of that community. The maintenance of anything tending towards better living has a good influence. The maintenance of a good road or improved road has a good influence by permitting easier intercourse between the people of country communities, between rural and urban population, and unifies social and commercial interests. The rural mail delivery is one of the greatest means of education today. Good roads facilitate rural mail delivery, and therefore tend to improve educational conditions. The improvement of our roads would also facilitate the central high school idea for country districts, for while our roads are not an impassable barrier in all of the districts, in some they are, and in many they are obstacles. If our country churches are to be supplied with good pastors and our country schools with able teachers, better libraries and other facilities, it must be by the support of greater wealth therefor, by the consolidation of the districts being possible only where good roads exist, where people can be easily and safely transported. The schools and the churches in many sections of our best land have a decayed, run-down, neglected appearance. Churches which are practically abandoned certain seasons of the year because of the condition of the roads, country schools not accessible in seasons of bad roads, little children plodding through