The Birmingham age-herald., 1910-12-05
Over Statement Made Before
 Railroad Commission
MUCH EXTRAVAGANCFs
It Is Estimated That Railroads or Country Lose One Million Dol lars n Day Through Ex-
 travagance
By PRESTON c. ADAMS


 age of a million dollars a day or more through extravagant and inefficient man agement has rather startled the financial community and has given rise to a most interesting discussion of the question, Are American corporations ably man. aged?" and 1t must be said that the an- swers have by no means been unanimous ly in the affirmative.
 The public hears of salaries of $50, 000, S750oo. $1O0,OOO and in on9 instance, s250,- GOO being paid officers of these aggrega- tions of capital and industry, and the conclusion often formed is that the bus mess must be carried on with transcen- dent skill.
 But what are the sober facts? One of the very ablest of Americas f1nanciers, mem- Der of one of the three largest interna- tional banking firms in the United States, director in corporations of the first magnitude. keen inquirer into things as they are and as they ought to be, a man not yet grown old in the service and who, therefore does not accept the ax- iom that what is is best, made the rol | lowing remark In private the other day: | ''The average American corporation is | mismanaged If We were to permit as l much waste and extravaganza in our own 1 business as runs riot in corporations, | why, we would not be able to pay the | rent of these offices. Corporate manage me,.t has not been reduced to a science by any means, as I have learned from | experience"
 Exceptions could be named The Stand ard Oil company and the great packing establishments of Chicago have elmi- mated waste in a truly remarkable de- 1 gree It is now an axiom that the oil 1 trust pays it's 40 per cent dividends | through utilizing by-products at one time considered almost valueless. The packers, too, are credited with turning everything that enters their doors into cash.
 The Steel Corporation in its Gary plant has greatly reduced the cost of manu- fracture; in fact, the saving is far greater | than the public comprehend. But the or dinary factory, 1t. Is claimed, is indiffer- ently designed and managed with only mediocre ability, there being too slight at | tenton paid to saving the pennies and the minutes. The late Edward H Hartman did much to inaugurate standardization 1 in running railroads. and James J. Hill more than any other individual has im- proved the method of getting a dollar 5 worth of results from every dollar spent in sending a train along the tracks. Btu most roads are still spending many un- l which under better system could have been carried out without relaying traffic half as much.
 Adversity inspires economy. Perhaps | the Interstate Commerce Commission s searching investigations will reveal to railroad managers opportunities for sav- | ing money at many points. The claims made by shippers may not all be justi- | fled, yet when they allege that money | d. vantage they are no doubt within the mark The authority already mentioned holds an important place in one of the | principal railroad systems in the country and is certainly not swayed by antagon- | ism to corporations in passing the strict ures above quoted.
 | Perhaps if only moderate freight in : creases be allowed greater diligence wilt be exercised in instituting economies and management. In the days when colored labor was cheap and plentiful the Trans vaat mine owners used 1t lavishly, but aftor the Boer war the supply diminished and wages advanced to such an extent that something drastic had to be done. With what result2 It was quickly dis covered that men could take the place of manual labor in many directions and that costs could be materially reduced without curtaIling output. Is it too much to hope that the railroad managers of the United States will learn from diversity what they have failed to learn from prosperity? .-Come easy, go easy,' is ofter true of money.
 Banking circles at this center are much interested In reports from the west that farmers are holding back their corn | from market because of the decline in | the market price. This is one of the | causes of the recent insistent demands of the western banks for currency and of | the comparative slowness with which crop money is being released.
 prominent bank officer of this city, who has been at considerable pains to ob- tain first hand data on this subject, says:
 Reports from the cattle and sheep growing regions and the far west indi- cate decidedly easier situation. This | is due directly to the conversion of their 1 surplus range cattle Into money Thus | far interior merchants and bankers in the crop producing region of the middle west have been disappointed in their collec- tons and consequently in the reduction of loans and discounts, because of the reluctance of farmers to market corn and grain at present prices. The oppor- tunhy seemed to the producers to be bet
 
 crop of corn by feeding 1t to cattle be- cause of the high price of live stock | rather than to sell the commodity direct ly The result is that vast numbers of cattle and sheep have been brought from southwestern and far western breeding ranges and purchased by farmers In the erop-growing sections for feeding pur- poses Interior banks have been called upon to furnish money for the purchase of these cattle, and as result the posi- ton of the country banks in the cattle breeding and grazing section has been made easier, while that of the middle western banks has been kept tight, not only for lack of ability to collect out standing loans but owing to the necessi- ty they were thus placed under to in- crease their discounts
 ",This situation will right itself as soon as the cattle which are now under feed have been made ready for the market
 In all probability the widespread feed ing during this season will bring a re- cesson In the prices of cattle, sheep and hogs. and this in turn will open up the p5ssibiity for large export trade in dressed meats and cattle on foot in the spring with advantageous results upon our trade balances. It will also have q beneficial effect in the liquidation of loans due to interior banks by ther local bor- rowers, as well as in giving those banks the means to discharge their own iabili. ties for the money borrowed.
 ."rhese circumstances mus. sooner Ol later be reflected in this market and pro duce wholesale and beneficial stimulus to trade.'