Bismarck daily tribune. [volume] (Bismarck, Dakota [N.D.]) 1881-1916, 1915-08-13
Division Of Railway Income
Between Capital and Labor

That labor is receiving not only
the largest part, but a rapidly in
creasing proportion of the income OF
the railways of the United States.
is shown in an analysis by w. A.
Warrington, vice president and as
sistant to the chairman of the South
ern Pacific, published in this weeks
Railway Age Gazette. Mr.. Worth
ington shows that in 1904 labor re.
ceived 5S.7%% per cent of the total rail
way income Invisible between capital
and labor, whereas, in 1914, ten years
later, it received no less than 66.O4
per cent. Capital in 1904 received
4l.27 per cent. while in 1914 it re-
ceived only 1896 per cent. While
capitals share of the income rela-
lively decreased during this period
and labor's was increasing, capitals
investment in railways increased
57.13 per cent. or from sl1,511, 537,131
to $685. $3.50, while the number
of employees increased only S0.S1 per
cent, or from 1,296,121 to 1.695,4S3.
Mr.. Worthington calls attention to
a recent report CT the National Civic
Federation that in the manufacturing
industries at, the present time labor
is receiving practically two-thirds of
the product and capital one-third.
For purpose of comparison he analyz-
es the interstate commerce commits
sion statistics to SHOW the distriou-
ton OF that part CT the railway in
come which is Invisible between cap
ital and labor. .
Gross Operating Revenue.
The gross operating revenue Of the
railways of the United States in 1914
was 3,O47,0l9,9 sos. From this he de-
ducts all operating expenses except
wages. $S26.S90.6S7 and taxes. $l40,-
531.575, which leaves $2,079,597,6i6
available for division between labor
and capital. OF this total, $1,373. 422,
472, or G6.04 per cent, was expended
for wages to labor, and the balance,
S7O6,175,174 or 1896 per cent. was
left for capital. available for interest
on bonds and other debt. dividends
improvement to properly, deprecia
ton. miscellaneous expenses and sur
plus. In 1901, out Of a total Oper
ating emu of S1,975,174,091 the
amount Invisible between labor anC
capital was 81. 500. 1S0,294. of which
5S.73 per cent was paid for wages
and 41.27 per cent was reserved fol-
capital.
Mr.. Worthingtcn's statistics are
presented in a table from which he
draws the following conclusions:
The return to capital in 1914 rep
resents only AIT per cent on the
railway investment. whereas in 1907
this return was 4.99 per cent.
Comparing 1914 with 1894, there
was an increase of s6S7.417,352 ir
railway income available for payine
labor and for cspital purposes. Oh
this amount, $3.50. 1928 1862, or S0.S6 pei
cent was paid to labor, and only
$131.593, $50, or 1914 per cent of the
total remained for capital purposes
This showes that of the increment il
Invisible net income during the ter
years. labor received four-ffths and
capital only one-ffth. AS compared
with the latter the investment IL
road and equipment increased s5,42a,
100, 100, the increment available for
capital purposes being onlv PAS pel
cent upon the increased investment
Inadequate Return.
Gas compared with this inadequate
return to capital it will be noted that
the increase of s555.S23. 662. or 67.9s
per cent, in payments to labor was
accompanied nv an increase Of only
339.362, or 1881 per cent. in the nun
Der Of employees on June 80.
While returns to capital were
greatly reduced through the neces
sity of larger prop~ortionate return tt
labor, they we're further reduced BY
1.-THE increased share given TO the gov