The Bridgeport evening farmer., 1914-06-30
THE CAUSE OF FAMINE IN
 THE MIDST OF PLENTY

z HK-NHE BIG FAILURES, or alnost- failures,
 which constitute the business depres- sion by which 50 many are disturbed, are not like the old fashioned failures our fathers knew In those days men went into business and failed because there was not enough busi- ness to do, or perhaps, because there was not capital enough to carry on the business.
 But the failures of these days, the notably injurious ones, are of concerns that do anenor- raoHs business, and that frequently, in the mo- tnentf when they suspend dividends, are doing the cord business Of their history.
 How does it happen there can be such famine in the midst of redundant plenty?
 Let man own a small business, which pays fair profit on his capital invested in it. and fair salary for his own time. As the business grows the profits will increase, and perhaPs thes salary of the owner, also, if he draws 8 salary in addition to his profits
 Assume. now. this business to be formed into Q company, with capital of $t00,O0O, and Inc company to be operated by the owner at a salary of $2,0OO. Assume that the business af- ter paying all expenses, including salaries, makes 0 per cent ins profits inkits naaximHnl year of good business.
 Men and women are willing td invest money to yield less than five per cent, if they can do so with safety, or believe they can.
 Sc the capital stock of the company is in creased to $2O0OO0, The earnings in the fol- lowing year are the same as before and the div idends of five per cent Is paid
 Now the company, seenA4o be an earner attracts the attention of some financier of the Morgan type, who acquires it, together with twoaor three enterprises of the same kind, and consolidates them not however with the same capital stock they had before, but with cap itaI stock three, four or five times more than sll had
 Now these companies will be doing the same business they did before, or even more but they will be staggering, because the busi- ness they do will not be profitable enough to pay dividends on all the stocks and bonds that have been sold following the consolidation The result is that bills run behind, improve nents are neglected, and all energies are turn cd to paying something to the unfortunate pIb- lie that bought the securities until time enough shall have elapsed, from the period when the Watered paper was sold until the crash comes go that the connection of the financier with the transaction shall be forgotten, or be less ap- parent.
 This is how financiefs arrange matters SC that there is famine in the midst of plenty, and mo dividends when business is best.
 Why do they do it?
 They do it for their pockets. The finan- cier acquires his enterprises, perhaps without the use of money at all, issues the water to the public, and receives from the public money re- presenting real value. The thing is form ol theft, a subtle method of appropriating the goods of others.
 The plumber of the New Haven railroad the sack of the Frisco line the breaking of the Pere Marquette are all to De attributed te finance the general type above described. The Claf1in failure, in slightly different way falls into the same class of financial phenomena.
 Such business methods can have but one result They destroy. confidence, by making everybody doubtful about the honesty of every body else.
 When the New Haven railroad suspends its dividends, men and women ask, ssWho now car we trust. If our money wasn't safe there where can it be safe?'
 zt is an inevitable and intelligent ques, lion.
 It is question Woodrow Wilson and the Democratic congress trying to answer They are trying to arrange things so that bic business will have to be honest business and to Iegislate so that great financiers can be dis singuished from great thieves.
 The sooner that time comes, the better fol big and little business and honest people every where.
 After settling your hotel bill, don't tc lip the proprietor by paying off all his help.