The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1914-03-17
BELL co. REPORT
Deals Frankly with Govern
iment Ownership Question.
why Co. Opposes It-Better-
ments, Progress and Policy.

new 1OFks Marcn lJ.-Tne annual
report Of the directors of the Ameri-
can Telephone and Telegraph COM
pany to Its stockholders was made
public today. The continued growth
OF the Bell system, its earnings and ex-
penses and general financial prosper
ity. it's attitude as to government own
ership. its agreement with the depart
ment Of Justice. the sale Of it's Western
Union holdings and its relation with
the general public are all set forth in
detail In the report
President Theodore n. Vail has
something very definite to say in re-
telephones and his frank discussion OF
this question Is perhaps the most in
teresting feature Of the report.
Government Ownership and Operation
In summing up the attitude of the
company towards this subject, Mr..
Vail says:
Our opposition to government
operation and ownership is not based
on pecuniary, partisan, prejudiced or
personal reasons. 1t is because of our
interest in the upbuilding of a great
public utility and its preservation.
1--WE are opposed to government
ownership because we know that no
government owned telephone system
in the world is giving as cheap and
efficient service as the American pub
lie Is getting from all it's telephone
companies. We do not believe that
our government would be any exccp-l
ton to the rule"
As to possible government purchase,
Mr.. Vail quotes Congressman Lewis,
the congressional exponent of govern
ment ownership. to the effect that
there Is no water in the Bell capitali-
zation; and urges the stockholders not
ings through fear of confiscation.
He shows that there is deficit in
all government owned systems and
says that every telephone system In
the world adopts the Bell system as !
standard, uses the Bell operating I
atus or copies 1t. And yet there is not
one, he continues, that gives an APP |
proclamation to the facilities that the
Bell system gives or gives as good or !
as cheap service. all past prophecies |
to the contrary notwithstanding.
The advantages of one telephone !
system are set FORTH as are the differ
ences between the exact technica!
knowledge required for operation and
the judicial ability necessary for regu-
lation.
Government administration" the
report says, lis more or less game
OF politics, and while with government
operation it may sometimes be pos
sible to have efficiency, 1t will always
be impossible to have economy.
1.-The government owned European
telephone plants, Notwithstanding the
low price Of foreign labor, are carried
at a much higher cost than those OF
the Bell system and yet every one OF
them uses the Bell system as model.
The book value of the plant of the Bell
system per station is less than so peri
cent that of Belgium: less than IS perl
cent that of Austria: about IS per cent
that Of Germany, Great Britain and
Switzerland: and all of them govern
ment owned"
Mr.. Vail says Americans are better
supplied with telephone facilities than
many telephones per capita as Great
Britain and thirteen times as many as
France, and that the rates here are as |
popular as those of any government
owned plant.
Growth of the Bell System.
During the past year subscribers
telephone stations have increased un-
til now there are 8,133,O17, q gain of !
67694S. These stations reach 10000
localities or 10000 more than the
mileage is 16,111,O11, OF which 90 per
cent Is copper.
More than half the wire mileage is
Underground, the total underground
plant representing a cost of $1S1,5OO,l
OOc.
The number of daily telephone con-
nectiOns showed a growth of nearly
two million. reaching an average of
27.237,OOO a day. Europe has only
tw0-fifths Of the telephone traffic of
the United States.
In the case of the associated COM
panies, excluding the American Tele-
phone and Telegraph company, parti-
cular attention Is called to the per cent
of net earnings and of dividend and
interest disbursements to total plant
and other assets:
Net earnings to plant and other
assets O.OSIf
Dividends and interest to plant
In other words, the property employ
ed earned less than per cent per
annum, and the dividends and inter-
est paid were less than per cent upon
the value of the property according
to the report.
Engineering.
The engineering evolution of the
telephone which has been accomplish
ed by the engineers, Is reviewed with
special reference to the marked i'm
OF telephone exchange
and methods of operation.
and the extension Of Transmission in
the underground circuits between
Boston and Washington. and in the
work Of connecting the Atlantic and
the Pacific for telephone communica-
ton. At headquarters the Bell Sys-
tenn has a force of $50 engineers and
scientists. 4 staff unequaled In the
Stomach Troubles