New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1876-09-18
PAYING FOR PAST EXERAEAGANCE.


CHEAP COAL AND CHEAP TELEGRAPlY.
WHAT IT WOULD COST TO DUPLICATE lHE WESTERN
uNIoN TELEGRAPH sYsTEM--A FAIR PRICE
FOR lELgGRAPHISG THROUGHOUT THE UNITED
STATES BASED OK THE ACTUAL COsT-EXORBI-
TANT PRICES FIXED TO PAY DIVIDENDS on AN
ENORMOUS STOCK ALL wATRR-CHEAP TELE-
GRIPuY To De SECURED AS CHEAP COAL HAS
BEEN.
To the Editor Of The TribuHe
SIR; The public arc indebted for cheap coal very
largely TO the earnest and persistent efforts OF your
journal in exposing aud rendering odious the recent
coalmonopoly. These gTaSping coal companies have
held their hands on the throat Of the people during
the past three years Of hard times oxtortng unreas
oaabe prices for their coal and believing they could
always maintain their sway Most of them have plir-
sued policy of buying more and more coal lands NJ
fictitious prices aad leasing other railroads ut rent
ais which involved them in large annual losses oven
at the time whom the combination was at the zenith
of its power The legitimate fruits of this unnatu-
raj monopoly will bankrupt some of the large coal
companies and cripple all tho rest for years TO come.
Now Mr.. Editor, you have helped to secure the
public cheap coal. Can yOu not do them good ser
vice by aiding also in the cause OF cheap telegraphy
I think your journal could not render greater
pullic service than by keeping up the agitation of
down. In Canada the telegraph companies have
common rate of 25 cents for message to any part
of the country the greatest distance being 1,3OO
mile,. In the United States the charges for long
distances are three four, and even live times this
sum. The Canada companies are capitalized ON
basis OF cash outlay and hence, even ut the 2oc"nt
rate tho leading company pays regular diVidehdS'
and it's stock is sought for as an investment.
Tho Western Union Telegraph Company, by pro-
cess of buying up competing lines and issuing STOCK
and bonds therefor, by the payment OF stock divl-
dends and by other sorts of nanccrng, has swelled
its nominal capital aud debt that about IL cents
must be added to a fair profit on every one OF Its
IL 600 900 messages of ten words each per year TO
pay per cent on its watercd stock-and tho stock
Is all water, as shall presently show The bonded
debt and rentals of leased lines, capitalized at per
cent represent a sum greater than is necessary to
reproduce the entire working plant of the company
at the present cost of material and labor Inc iol-
lowing statement tells the whole story;
R onn1S Of leased lines capitalized at
nor cent (astimatel. o,2CO,OOo
Capital stock outstanding. .............337s1'sIo
Total stock and debt. $40 69s,s3o
Now II would cost TO reproduce these lines as
follows:
1888 miles OF wire and poles at $50 ,oo,o
lO64 400 miles extra wire ana Insulation .. -,
at SD per niie....-.......-....-...--' @ooO'oVV
Total cost OF reproducing the lines SIS fs60iO
Here then il an aggregate of $37.2l2,l 100, repre-
sented by stock and bonds outstanding, beyond
what il would actually cost to-day to reproduce the
entire Western Union Telegraph system
IL ia true that the company has building IN this
CITY, and various securities; but il is doubtful the
cash value of all;this property would affect more
than the difference between the present cost OF the
lines and the gross bond aud lease liabilities This
would leave the entire capital stock to DO taken care
of at the public expense Every penny paid IN divl-
dends on this stock comes, therefore, out of an ex-
orbitant profit and requires as before stated, the
addition of about ~ cents TO each message beyond
q fair living profit on the actual cash outlay.
It's the opinion to-day of the best practical tele-
Qraphers that with lines built for cash. and worked
with economy, common rate of 20 cents for ten
words throughout the United States would pay
fair return on the capital Ii seems to me 1t Is for
the interest of all tho existing companies to reduce
their capital stocks to some fair figure; at any rate
TO reduce their rates and meet the public fairly. III
the public will do Us they did with the coal combna-
tion-buy sparingy-tho telegraph companies will
soon feel the force of public opinion. The public
are in no mood Just now to DO taxed an exorbitant
price on one of tho necessities Of life IN order to pay