or combined rail and water
systems of transportation.... That the possession, control, operation,
and utilization of such transportation systems shall be exercised by and
through William G. McAdoo, who is hereby appointed, and designated
Director General of Railroads. Said Director may perform the duties
imposed upon him so long and to such an extent as he shall determine
through the boards of directors, receivers, officers and employees, of
said system of transportation." President Wilson issued an explanation
with this proclamation in which he said:

This is a war of resources no less than of men, perhaps even more than
of men, and it is necessary for the complete mobilization of our
resources that the transportation systems of the country should be
organized and employed under a single authority and to simplify methods
for coordination which have not proved possible under private management
and control. A committee of railway executives who have been cooperating
with the government in this all-important matter, have done the utmost
that it was possible for them to do, but there were differences that
they could neither escape nor neutralize. Complete unity of
administration in the present circumstances involves upon occasion, and
at many points, a serious dislocation of earnings, and the committee
was, of course, without power or authority to rearrange charges or
effect proper compensations in adjustments of earnings. Several roads
which were willingly and with admirable public spirit accepting the
orders of the committee, have already suffered from these circumstances,
and should not be required to suffer further. In mere fairness to them,
the full authority of the government must be substituted. The public
interest must be first served, and in addition the financial interests
of the government, and the financial interests of the railways, must be
brought under a common direction. The financial operations of the
railway need not, then, interfere with the borrowings of the government,
and they themselves can be conducted at a great advantage. Investors in
railway securities may rest assured that their rights and interests will
be as scrupulously looked after by the government as they could be by
the directors of the several railway systems. Immediately upon the
reassembling of Congress I shall recommend that these different
guarantees be given. The Secretary of War and I are agreed that, all the
circumstances being