The Detroit times., 1910-12-07
FREIGHT RATE ADVANCE AS
EDW. FRENSDORF VIEWS 1T

| We are nearing the season OF good
| fellowship, when mankind Is mello"
and cur hearts go out to our less TOT
tunate brothers, and | can see no rea-
son why men and women earning from
20 cents a day up should not snow
their appreciation OF the privilege
granted BY the kindly gentlemen VINO
own this country. permitting us 10 re-
main on earth and do their bidding.
Morgan, Rockefeller. Hill and the bal
ance OF the unfoTtunates VINO own the
railroads of the country are begging
of you and me To aid them and prom
Use that such funds as we may donate
will be expended in the improvement
Of their property How generous
But even that is not true: they
would do nothing OF the kind with the
! increased earnings from higher
| freight rates. They would absorb that
and the minute any improvements
were to be made. new issue OF bonds
would be doled out to the public and
| next year another appeal would be
made TO the people asking for an
! other increase in rates TO enable
them TO pay the interest on the bonds
issued for these improvement.
From the clever way the beggars
have this proposition framed up. one
| would think these roads belonged to
your city. county or state, and all
these improvements would belong TO
YOU because you are asked TO pay
| for them, and that you and your pos
| terity were TO have the benefit OF this
additional equipment for all time.
But the reverse is the fact The more
improvements made the more the bond
issue. and the freight rates named are
based on fixed charges. and the IN
terest account is the first TO be con-
sidered. You pay II.
Upon a capitalization that is based
on a liberal estimate OF the actual
value of the property and equipment
OF every kind and nature, the present
freight and passenger rates would pay
dividends OF 81 IA per cent-(sorfe
very good authority place 1t at over
25 per cent profit Notwithstanding
we'll established charges OF extrava-
eance and graft in the management.
That's the way these big fellows get
SO much money-by issuing stocks
and bonds only limited to the extent
they can get the public TO absorb;
by taking over property TOT nVe mn
lion dollars and at the ead OF few
years. I'm which time many klnus Vi
Juggling and consultations are anect'
ed. 1; receives the magic touch ana
Is made part OF one of the great sys-
TENS. Then twenty millions In Dohds
and ten millions OF preferred ana
twenty millions OF common stock are
Used against this fve-milllon-doliar
nroperty of a few years before
inst want TO say that stocks ana
bonds are issued against railroad
nroperty on the slightest excuse ana
many times without excuse or reason
and for no other purpose than TO en-
rich the manipulators who pocket the
proceeds OF the sale OF these securi-
ties.
To make this point more clear. |
would ask you to inquire as 10 the
number OF railroad stocks that pay
as high as Z per cent In dividends. |
think you can enumerate them on
your thumbs Those paying 6 per
cent dividends are mighty few. The )
per cent class are not any too numer-
GUS When YOU get down to the 4 per
cent limit less than half the roads can
get in. while la the class from per
cent to- less are the other 80 ptr cent
of the roads enrolled.
Can you see why this is? Simply
| because as soon as the road shows
! earnings ON its present capitalization
the public Is made aware of II through
different publications and AT an oppo'
tune time limited amount OF new
issue is TO he offered The public De-
ing eager for IL over-subscribes the
amount offered and II goes TO pre-
MUM thus giving the insider chance
to unload his holdings that cost him
nothing. as see 1t. an increase IN
freight rates-means all increase i'm
earnings-this means an increase I'M
the bond and stock issue. Where is
the public benefited?
: For the most part those who are
making the loudest clamor for higher
; freieht rates are nothing hut stock
market manlpulators who expect and