The log cabin Democrat., 1912-09-21
DfNOUNCfS RAISE
IN PHONE RATES
PROF. MEADORS WRITES
RlDlCULES PROPOSITION OF.
FERED SUBSCRIBERS BY
SOUTHWESTERN CO.
Editor Log Cabin Democrat:

Editor Log Cabin Democrat:
; Did you read Bob McCulloch's busi
ness proposition in Thursdays paper:
If you did not, get the paper and reac
1t. At first it will strike you as very
unfair and extremely avaricious, bu,
after little sober thinking | fee
quite sure that you will gracefully ac.
qulesce in the very fair proposal he
submits the good citizens of Conway
Let us look into the facts in the
case. Mr.. McCulloch has $4,000 in.
vested in his plant; that it is old ana
ready for the junk heap, provided he
can ma way to install a new outfit
up-to-date, without having to pay for
1t himself. Why should he nave to
pay for the new plant, or why should
ne not be allowed TO charge such an
increased rate ON ice as will insure
hlm good dividend on his invest
ment and gradually pay off the oriei-
nal cost OF the plant? Will not the
citizens get the benefit of his increas-
ed capacity and better service?
i Let us make u comparison. Sup
pose merchant wishes to double his
capital stock. Would it not be fair
Tor hlm to increase the cost of each
artlcle to the consumer to such an ex-
/ TENT as to insure good return and
gradually pay for increase of capital?
NO, every citizen would at once bow
colt the store if such thing were at
tempter. No, Uncle Bob would sell
no ice next year, if he should put into
effect his rdiculously humorous pro-
posal.
! Now, as unfair and humorous as
the above may seem, the very essence
OF 1t is about to be fastened upon the
citizens of Conway by another institu-
tlon. 1 refer to the Southwestern
Telephone Company The new pur-
chasers propose to practically double
thelr investment here in the way of
putting in new and up-to-date sys-
TEN, as they say. Now they come to
The subscribers and ask them to sign
their names to a petition asking the
company to come to their home each
month and collect 25 per cent in
crease in rate just because the com
pany says it must have it to insure
them liberal income.
NOW, | recognize that everyone who
signed that document is a free Ameri-
can citizen, and it is none of my busi-
ness why he signed it, but |, for one.
see IN 1t an exact parallel to the one
ironically stated by my friend Mr..
McCulloch. | feel that every man who
signed for the increase in the tele
phone rates could, with Just as much
consistency and better grace, sign for
increased cost of ice.
Oh, you say ''it is nothing to us
that Mr.. McCulloch owns $50 900
ice plant that is out of date and ready
for the junk pile. Let him suffer his
own lossi' Why are you not consist
ent? That is just what the telephone
people are doing. They say that it
VIII take $4,000 to put in a new sys-
TEN and that not more than 5000
worth of material from the old sys-
tenn can be used in the reconstruction.
Whose fault is it that these practical
business people paid more than $50
900 for telephone system that is
ready for the junk heap? Either one
of two things is true: that they pos
sess very poor business judgment (?)
or that they were willing to pay a
long price for the system. as their
iSpi stiiilllS, LOT tIit
OF fostering upon the citizens of Con
way rate system such as will insure
good income and, in addition gradu-
ally reimburse the company for the
$50, 900 loss on the original purchase.
The latter seems to me to be the
truth.
Let us figure little. The company
says 1t will take $40 900 to put in OPP
Grafton an up-to-date system. Their
representative says the company is
satisfied with the modest income of 4
per cent What are the facts? There
are nearly 400 phones in the city pro-
ducing a gross income of more than
$500 a ncnth or over $4,000 Il year
(not including long distance or rural
hnes) The operating expenses and
repairs are said to have been not
more than $4,000 for the last II
months. This leaves net income of
20 per cent on the investment. What
a difference between per cent and 20
per cent!
Now, let us be fair with the COM
pany, and help it to find more just
way to make its per cent or even 8
per cent, and that, too, not only on the
$4,000 necessary for putting in Il
good system, but upon that plus the
$40, 900 it paid for its junk heap (0
s per cent of $4,000 is $4,000. And
as the company's present net income
is more than $4,000 year, it is evi-
dent that the company can put in the
$50, 900 improvement and still get IL
good return on the investment.
/ If | had time and space | could
show you how their representatives
juggle with figures. Take one exam
pie: This great corporation claims
to have never declared Il dividend