Los Angeles herald., 1908-09-28
Earnings over

1908 ........ s.S4e.74o.2s6 2s4442.51e
1907 .......... 2,eO2, 75ISos 266,ilT2l7
Tho gross earnings of ell the rail-
roads OF the country for the year 1902,
the year previous to the beginning Of
the flve-year period treated of by Mr..
Taylor. was s1,72O, ,s14900. Taking this
as an average year for the five years
ending with 1902. or the fve-year
period Immediately preceding the five
years referred to by Mr.. Taylor, which,
of course. would be giving the COM
panies an advantage, as undoubtedly
the railroad companies had shown an
annual increase of income during that
period, we get a total increase In gross
earnings for the five years referred to
by Mr.. Taylor over the Ave years i'm
mediately preceding that period of
81, S44, $40, sos.
Supposing that the operating ex-
penses of these railroads average 30
per cent Of their gross income, which
is fair estimate taking all the roads
of the country together, Mr.. Taylor's
figures show the increase in net in
come earned by the roads for the five
years to which he refers over the pre-
ceding five years to have been s1,172,-
153,799.
This, 1t will be understood, means
excess in net income earned for that
five years over the net income earned
for the same period preceding, at the
most liberal estimate for such preced-
ing period. But Mr.. Taylor further
shows Quoting from Poor's Manual of
Railroads) that during the five years
which he has under consideration the
liabilities Of the railroads in the form
of stocks, bonds and certificates of
sum of s4.264, sos, sO5, the same being one
fourth OF all the liabilities that the
railroads Of the country are carrying.
Thus we see that in order to make
their investments in construction and
equipment of s2,49S,591, ,S15 within the
term Of five years Of which Mr.. Tay-
lor treats. the railroads had received
from the public in that period in the
form of increase in net earnings and
in money from stocks and securities
issued which now rest upon the rail-
roads in the form of liabilities and the
interest and principal of which must
at some time be paid by the public,
total sum of $5.4S6,S52,7o4. This. of
course, is assuming that the stocks
and bonds issued sold at par.
1t Is certain at any rate that the
American public will be called upon to
pay in the form of freights and fares
sufficient money to the railroads to
produce an income upon these liabili-
ties in the form of interest upon the
bonds and dividends upon the stocks.
In other words, from the huge total
sum which the American public has
been called upon to pay in the form of
net earnings, or will be forced to pay
income upon in the form of interest
and dividend. 1t has received benefit
of less than 46 per cent, which has
been invested to improve the condition
of the railroads.
That is, in order to have 81 invested
to improve the railroad service of the
country the American public must pay
in cash, or pay interest upon, more
than 81.
The Herald is not in favor Of the gov
ernment ownership of railroads; that
is, 1t is not in favor of such ownership
provided the powers of the government
over such corporations can be SO ex-
tended as to prevent the improvident
use by those great corporations OF
money paid to them by the public or
upon which the public is always called
upon to pay interest.
The owners and controllers OF Amer
lean railroads should learn, however,
that the public will not stand forever
for the kind of financiering shown by
Mr.. Taylor's figures, and that If they
shall continue to manipulate the poll
tics Of the country so as to prevent
fair and necessary government control
and regulation, some day the people,
in order to protect themselves, Will
take possession of these great proper
ties.
1t is pretty safe to say that if they
were managed by the government they
would not cost the public more than
two dollars for every dollar that 1t gets
IN advantage Oul VI bllSlI OPSAhIAOA
as 1t is doing now.
We may add here that Mr.. Taylor's
figures furnish another and a very
strong argument in favor of the adop-
ton by the government, in the form of
law, of the policies recommended by
Mr.. Bryan and embodied In the Demo-
cratic platform, viz, That the inter-
state commerce commission be given
such control of the railroads of the
country as to enable it to see that
when stocks and bonds are issued by
these great corporations, upon which
the people will be called upon to pay
dividends and interest, all the proceeds
of such stocks and bonds shall be de-
voted to the advantage of the people
In improving the means of public COM
munication afforded them by railroad
lines.