The Saline County journal. [volume] (Salina, Kan.) 1871-1893, 1886-01-07
Pereent
maammHn

| on tie Illinois fOal5 atuFe u "a - pei
cent. of gross earnings, ami the aver
/ age on the Kansas roads named Is
| al IS Der cent, e difference In favor OF
/ Kansas roads OF 9.SJ per cent. The
| writer then adds: "W lien the aver
| age Kansas RAILROAD receives one dol.
| lar for services there Is 9.S8 cents more
| % that dollar net profit To the railroad
COMPANY than there il with the aver
are OF the best Illinois roads. This
showing does not prove the eastern
roads Ia be paupers, or even 10 have
shared in the general depression OF
the country. Tie large rate Of pTOiit
j. the direct result Of higher eastern
rates, rates that were adjusted 10 a
business in It's infancy, and have not
been curresp0ndingly reduced as the
circumstances and the Increased
growth OF the country have de-
mauded.
The writer goes on to state "If
We compare tie average proportion
Of earnings VI KANSAS roads Ia 1850
with 1884, We fad the ratio Of profit
largely increased ia 1885 Oser 1854.
Ia 1884 il being a IS, in 1883, AZ -.
In dis particular, says the writer,
Il desire To cali your attention Ia the
fact that the Union Pacific and
branches has led in the advance with
an increase of 1905 cents on the dol
lar, four times the average improve
nient in Kansas, showing that there
L. "a reasonable latitude for granting
the concession asked for la the COM
plant"
II is evident that the writer's idea
Is that the ability Of y railroad COM
pany % reduce its freight rates Is Ia
De determined from comparison Of
it, own expenses to earnings. aud that
the ability of Kansas railroads to car
~ freiEhts at as favorable rates rs are
charged on the leading lines in the
state Of Illinois, Is Co he deduced
from the fact that the ratio OF eXpen-
ses 10 earnings is less on Kansas roads
than is obtained la the former state.
The fact that the percentage Of net
earnings 10 operating expenses on the
Union Pacific road was greater
in 1885 than in 1884. showing an
aggregate reduction in expenses Of
81 .3gl, 21i SO, yet the net revenue re-
ceived by the company In its business
In 1885 was only $50, 449.5l in excess
Of tnat received the year before.
would seem TO be sufficient TO show
MIR. Collins that his figures have led
him afsray. That they have, Is easily
demonstrated from the example he
has furnished Us. Take FOR example
the st l.. & 5. f. road, whose percent
age Of net earnings to expenses Is the
highest IN the list Of Kansas roads,
ana compare It with the road named
If raE
Chicago x Alton. The difference j.
I4.O4i in percentage OF net earnings 10
expenses in favor Of the Kansas road,
or more properly, the ratio Of exPen.
ses is that much less. Yet the total
earnings Of the Chicago & Alton road
for 1854 were SS,TO9, 274.22 and the
earnings per mile were SIC, 24j 81,
while the total earnings Of the II
Louis & santa Fe road were 81, 32j =
6.Z3 SO, and the'earnings per mile were
s. 5sI g8. The net earnings per mile
of the 4 lton road T. 81 39S 3, aud the
net earnings per mile of the Kansas
road il sl44 90. Instead Of the Kan
"a. road earninga profit over the llli-
uois read Of l4.O4 per cent. a. claimed
bv Mr, Collins, the last named road
has a profit in its earnings Of 2S.jl per
cent Ia excess OF the Kansas road
Roth the larger percentage % eNpcn-
ser 10 earnings, and the greater ratio
OF net earnings per mile Of Tie Chica-
gn A. Alton Tuad are due to the fact
thaf it- freight traffic Is very nuch
larger. For Instance the per mile tom
n,srn on the ChiCsgo X Alton rnad for
lSs4 was 20 gl3 tons, on the Frisco
r 40 was -gD.Jj4 Other r0ads in the
Illinois list given shove have . much
heavier ionmage than the Chicago q
Alton. ID will be perceived that ihe
Gxei charges being substantially the
ss,fIe GA baib roadz. tine iinuleu-eiy
greater lrafe Of the one can De carried
~ lower rates OF charges, and suh a
larger aggregate profit be derived
nom ID, than the other eau earn The
amount necessary 20 pay operating
EXPENSES at the low ratio Of expenses
tor 1854. lakes and fixed charge PEI
mile ON the 'Friso ruad j. 81 4i2U5
Apply the rate per ton per mile char
ged on the Alton road, 10 the tonnage
on the Frisco road, and Il will pro-
duee, together with income from All
other sources, revenue eOf s4.ls5.0O
Az expenses aud charges 20 keep tue
ruad in q solvent condition,
The per mile tonnage Of the Atchi-
snn, Topeka 4 Santa Fe rad is great
er than the tonnage Of the Frisco
Rad, being 2Tl, 592 tons ID round
number. It's interest or hxeii
charges are also lighter. A crucial
test can be obtained by applying Mr..
Collins conclusions 70 this road The
argument Is that the percentage Of
expenses 60 earnings being les on the
Kansas than the Illinois road, the
net profits Of the former are larger,
and therefore Il can afford as favofa-
DIE rates as the latter road. IL the Ar
ghment is worth anything, the rates
should be lower. To pay operating
expenses, taxes and fixed charges, the
santa Fe road must earn S., 1889. The
Chicago & Alton rate charged upon
the tonnage Of the santa Fe road, and
earnings from all other sources IN
1884 would produce q revenue % 81
les -. an amount insufficient % keep
the rad out o. Bankruptcy.
Tfthis d trueof the Atchison road,
II is 60 10 q greater degree o. 70 al
other Foads in Hanses, ard Il d Z
matter Of the simplest demonstration
thsfif the EaEsas roads were con-
! PEELED % accept the freight rates Of