The Houston daily post. [volume] (Houston, Tex.) 1886-1903, 1897-12-12
From the Indianapolis Sentinel.


subordinate
From the Indianapolis Sentinel.
THE PEOPLE PAY.-The discussion OF
the principle OF municipal franchises is
turning more ana more to the point u,at
the masses OF the people pay the enor-
nous profits derived from their operations
and that this payment Is unnecessary be-
cause the same service can by proper e.
fort be secured without II. A striking
presentation OF this truth Is made by MIR
Clarence s. barrow OF Chicago. in reply
TO request for his views from the Illinois
bureau of labor statistics, as follows.
The gas companies, street car compa-
Mss, telephone companies and other IKE
corporations which are doing business IN
Chicago through the use OF the streets
and other public property have issued
stocks and bonds which have q par value
OF not less than SIS, 1000. 900. Much of this
stock sells above par and probably the
market value OF the whole amount is
about the same as the par value. The
stocks and bonds represent properly
which cost not more than $50. 900 900 there
fore the 500. 10000 worth of these stocks
and bonds owned by private individuals
are issued upon tho property of the whole
| people Of Chicago. And the divided Is ra d
| to the private individuals who own the
stock issued on this public property ere
not lass than $4,000 900 year, OF moe
! than the whole cost of supporting lne cub
| lie schools of the city.
NO person is ingenious enough &c give
any honest reason why the people Of Cni-
| cago should give to private individuals
this vast amount OF property without any
reeompsnse whatever, This $4,000. 600
which is taken by private individuals each
year from the total property OF Chicago
| represents an annual tax OF about $c5 or
$40 on every family in the city--a tax
which is not expended for public pur-
| poses and Is submitted TO by the poor
for the purpose OF enriching few
This is practically the sltualton in many
other cities. and Indianapolis ~ no exce,-
ton to them. The Citizens street railwey
company paid sS,250,OO for its property.
and In the transaction the plant was valued
at $4,000 900, and the unexpired franchis
al Sl.2j0,o00 The only thing that gives
such value to the franchise Is the profit
earning power OF the plant And the com
pany did not overestlmate the value OF the
franchise when 1t proceeded TO reorsan'ze
on the basis of forty years franchise,
with a capitalization OF 81 600 600 That
meant, OF course, that they expected ia
make the surplus $1,000 900, together with
interest and dividends. out OF the people
OF Indianapolis through the operation OF
the plant, and they could have done Il
II they could have succeeded in getting 4
copation OF the franchise.
The Indianapolis gas company Is oper-
ated by New York syndicate which pa d
5000 900 for its property. 1t issued So.
ooe.OoO of bonds and paid for the plant II
=, also iscued $4,000, 900 OF stock on which il
mas been paying II per cent dividends In
= other words, It extracts a proiit OF ovel
: S24OUo year in addition to all expenses O
= every Kind and good interest on its in.
= Ncstheht. AS a. matter of necessity this
, money comes out of the pockets of the
ptopie IN me form of extra price paid fol
has' II the proposition were put blunt,
' 70 TIE public whether a special tax o.
s-'no00 per year should be levied and III,
proceeds donated 10 a syndicate OF Now
YORK capitalists everybody would boot n
ire suggestion and yet that is exac,l,
what is being done. and there are peopl
helping TO pay the money who are bin,
enough 10 be deceived as to the folly o
: H. Every cent of profit that is taken n,
: these companies In excess of fair return
On the actual investment is a donation I,
them by the people who grant the unwis
franchises, This Is the essential pon
which ought to be thoroughly uadeTstoo
ny every citizen. and when IL is fully I'M
derstocd there viii be little difficulty /,
the regulation OF such franchises
. From the Nashville American.