In June 1936 Eastern railroads began selling passenger tickets at 2¢ a mile (after 16 years at 3.6¢). Within a few months officials complained that the low fare was a losing proposition. Increase in traffic, they said, was not enough to compensate for the cut rate. After hearing them grumble for months, the Interstate Commerce Commission last July permitted them to hike their fares to 2½¢ mile. This was expected to raise income about $32,000.000 (TIME, July 18).
By last week, earnings reports for August (first full month since the 25% boost...
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