The Ottawa free trader. [volume] (Ottawa, Ill.) 1843-1916, 1874-03-21
$5,497,540,77
$l,907,22S.22
S69.390. 90
41S,04073
l21,505.G3
| ExpeDses-operating. ...,
Maintenance ofroad
Other expenses.
" Taxes ...........


$3376, 254 81
Making net earnings $2,121, 1850,
The road is about $50 miles long and cost
for building equipment &c, about $SOOO,OOO'
The net earnings would pay 90 per cent. on
that amount and leave quite n balance; but
we have no doubt the stockholders groan that
they get less than 10 per cent dividend and
think freights and fares ought to be doubled
The Chicago, Burlington & Quincy K. T.
presents its financial budget for 1873 through
its president, J. NJ. Walker, Esq After stat
ing the earnings from all sources and ex.
penses for all objects, including officers
salaries and interest on Indebtedness, he
strikes "a balance, and makes the net profits of
the year $1,000 1878. This road is about
1870 miles in length, and cost, President
Walker tells us, $4,000 per mile, or about
$S,S00,000 Yet somehow these three mil.
lions of net profits must be divided on 4
capital stock of 6,429,5 62,2G Of course
some $lS0OO000 of this stock must be the
result of the watering process, or "capitaliz
ing earnings" as it is more politely called
That is, when road like the Burlington
comes to earn SO per cent. on its cost il begins
to look hoggish, and the stockholders issue
| $lS 000, 600 of new stock and divide it among
themselves, declaring dividend Of II per
cent on $26,000,000, instead of 80 per cent
on $S,000,000, which gives the thing the ap,
pearance, at least, of more decency.
The president of the Illinois Central reports
the total earnings of that monopoly for the
year 1873 at 1884 ,59367 and total expenses
$460O0077, leaving nedearnings IS, 1874, 4S490
President Newell says the property which the
company nov owns cost $370000O0, and
thinks the trife over 10 per cent which the
net earnings yield on this cost is not extortion
ate But president Newell banks largely on
popular Ignorance IN making that statement
The Illinois Central railroad company organ
lzed as corporation with $50, 0OO, 900 of cap
ital on which the stockholders never paid in
but 40 per cent, or $S,000,000 All the RES
OF the $37 900 900 which its property is nov
worth was made out of the earnings o
the road and the sale of the lands which tn
general government gave 10 the state and th'
state gave to the company for building the
road, and the company has piled up these
$37 ,00O, 900 too, while it has been regularly
paying from Z to 10 per cent per annum on
not only the $20000,000 of stock originally
issued, but on some $120OO,000 more OF
watcred stock. In short, the stockholders OF
the Illinois Central road, who whine every
year over their small dividends and over
the half million they pay to the state, arc in
fact dividing annually nearly 40 per cent. on
They are a beautiful let to howl about the
demand of the farmers for reasonable rates
But the biggest monopoly whose report i:
before us is tho Pennsylvania Central Thi,
company, whose road, or main line from
Philadelphia to Pittsburg, is trile over 30t
miles in length and is claimed to have cos
1914 100000, reports earnings for the year al
$24 $3.50, 00S.90 and total expenses sl5,440,
30j19, leaving ne, earnings $9,4ij, 703.7I, OF
about 81 per cent Of cost Yet by frequent
watering the company has some $50, 100000
of capital stock to pay dividends upon, and
was able, during the past year, to divide but
. triile oyer 10 per cent on its capital stock.
While with these big monopolies railroad.
ing is thus enormously profitable, it must: be
borne in mind, however, that these concerns
are among railroads what the Stewards, aud
Clanins, and Dodges are among dry goods
men, and that rs the mass Of smaller dealers
have hard struggle 10 keep their heads
above water, so many of our smallerrailroads
have a hard struggle from year to year to
meet running expenses, while the only profits
or dividends are such as occasionally line the
pockets oftheir dishonest officials.