The Scranton tribune. [volume] (Scranton, Pa.) 1891-1910, 1900-10-10

eion OF labor holds as good In the heid OF us
tribution as In that Of production. II is In.
evitsble and II Ia profitable. The department
stores and the money order stores sell for 10
per cent instead oi 30 per cent. profit, and the
consumer thus saves 20 per cent. The profit
obtained by the distributor Of staples. on the
way from the farmer ~ tile consumer, is less
than one.quarter what IL was thirty years ago.
The farmer secures a wider market the con.
s,n,er gets his staples just so much more
chcapiy, and the enterrrising n,iddleman avals
OF improved banking and transportation facili.
ties to do a larger business This Is why he
has adopted as his motto, "quck sales and
s,i all profits"
The real benefits OF 'capitalistic production"
az compared with production on q small scale,
sro twofold. Tie first and greatest bsneht Of
industrial combinations goes to the Whole body
OF the community as consumers. through rcdut.
tion IN prices. The next benefit. and that next
most largely distributed, gocs, as have shown,
to the workers through increase Of wages, and
thus It happens that the workingmnn gains
simultaneously in two ways lie gets more
money for his work and more goods for lis
money.
Regard to capitalization.
Having reviewed the position Of Our great
consolidated corporations as the results OF an
economic evolution, I feel that something should
be said with regard to their capitalization. N
general there has been much greater conscrva.
tfsm In the capitalization Of industrials than
there was In the original capitalization oi rail
roads. Our railroads were built PRINCIPALLY for
the amount of the bond sue, and the stool
represented the capita,iscd hcpes OF tho projcc
tors. The issues OF industrial bonds have been
considerably below the actual value OF the tangi
5le assets, and industrial stock issues have gen.
orally been based on actual earning capacity.
still IL Is undonbttd that there has been moro
than one instance Of marked over.capit talization
OF industrials and no proper Legislative measure
to remedy this wronu or oreycnt its recurrence
should be neglected.
Fortunately, the evil caused by careless in.
vestinr and uny.ise Capitalization tends to cor
rect itself by natural laws. Investors, naturally
timid, confused by the few inflated industrials
whicl, were nut out simultaneously with the
sound ones, arc afraid to buy, and the organic
ers. unable to sell their securties, now realize
that sound capitalization is the best policy.
In organizing industrial companies preferred
stock, which ia intended for an Investment SO.
curity, should not lie issued in excess of tangi
BILE assets. except in special cases, where thero
is very large earning capacity protected by
valuable patents or trade marks. Verified earn.
ings and regular dividends will establish conf.
dence, and the pri ,es Of the shares In the we'll.
organized and well l.manaped industrials will ad.
vance as did the stocks oi railroad companies
were
While 1 believe in great organizations; while
I know that they are necessity in order that
this country should become great power IN
the economic world and thereby continue the
prosperity Of the wage earners Of the land, l do
not believe in large aggregations Of wealth in
the hands OF individuals untitled to wisely ad.
minister such great trusts One OF the un.
favorable features OF our industrial situation Is
that the mon of great constructive ability, are
:, 1oof.
Of opportunity, it will be difficult to find men
to assunc tho arduous RESPONSIBILITIES cf indus.
trial leadershin who have the knowledge, the
Judgment the ability and the integrity OF Car.
nege and HUNTINGTON o. ko.k'el'ts esno, ahu f'en ,hs
doors tbe org,nizers-men whose creations arc
the great landmarks in our industrial history
II ia fortunate that VIZ have had such lead
ar. Thev did tbe,, work with the aggressive
force that comes of natural energy and temper.
NJ. living and with the Judgment that comes
~ cxncriencc, Thcv have understood and have
been in sympatbv with the people because they
have heen q, tLe peonle. and the example Of
those mon rising from the ranks gives impulse,
encouragement and high aspirations to every
worknemnn in the land. They made their for.
tunes by reducing the percentage Of profits and
;ncroasno tbe volume Of business; by reducing
tho r,to ~ freight IN n barrel Of -four to the
Atlantic from AZ 10 to G5 cents: by reducing the
nr;oo n, cteeI from s1oo ner ton to $50: by i'm
nrovinr the ouality and reducing the price Of
nrovis;ons and by.pro]ucts while paying
higher nrice to the farmer for the animal; by
reducing the price OF oil from 80 cents to 10
cents. nv reducing the price OF cotton cloth
from 9o cents to 3 cents. They realized that in
order to make their combinations a grand sue.
cess. thew must increase production by reducing
nrices to the consumer Thus they are not only
boned "a develon n great home trade, but ena.
hlod us N omen the door of foreign markets,
which has resulted in an enormous balance Of
trade In o,r favor. on which our prosperity so
LARGELY denends
1ndustrlals OWneo oy many
The ndustrials today are owned by the many.
While economic evolution is centralizing pro.
duction in large corporations, decentralization
of ownership goes on simultaneously through
the rapid distribution Of shares. There are
many hundred times more partners in manu-.
facture, mining and railways than there were
thirty vcars ago. and the number is rapidly in
oreasing. Under the old conditions Of private
firms, the number Of female investors averaged
but . per cent, Now in every corporation they
have many shares, and as share holders they
have tho full rivl,t of suffrage.
Under the old conditions Of private owner.
.hin. the control of many OF our industrial en-
ternriscs would have been inherited by one in.
liyidusl or family. Now the control is subject
To tbe same rule that prevails in the admins.
tration OF our state. and that is the rule Of the
majority 1t is seldom (and fortunately so,
as preventing great aggregations Of wealth IN
the hands of individuals or iamilies) that the
heirs Of giants in industry have the capacity
to succeed to tie direction Of gigantic enter.
prises Many inheritos Of great fortunes, en-
eryated by ease and luxury. prefer life Of in.
ciety; others prefer TO de'ote the'r TINE 70
literature or art; others TO enter upon seie'''nc