The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1915-03-02
"CAN AFFORD IT.
ChIef of Engineers Brother
hood at Wage Hearing
Says Railroad Revenue Is Suf-
ficient for Bigger Pay.
MAKES SENSATIONAL CHARGES
Alleges That Huge Capital Was
FlOated Against Labor.
Measures Against Employees
Demands Taken Years Ago.

Chicago, March Warren S.
Stone, grand chief engineer of the
Brotherhood of Locomotive Engineers.
today submitted to the board of arbi-
tration which is hearing the western
railroad wage case. a statement in re-
buttal to the testimony of the railroad
mana gers, in which he charged that
the issuance of fictitious securities had
absorbed past. present and future
revenue gains of the western rail-
roads. He declared There is no
hope for the railroad employees to
secure an equitable participation IN
the fruits of their work so long as the
present financial control and admin
istration of the railroads is unregu-
lated
He pointed out that the employees
associations found economic justice for
their demand for increased wages in
the productive efficiency of their
work, but that the constant conten-
ton of the railroads in reply to this
argument was that revenue gains
arising from increased productive eff
ficiency were absorbed by increased
operating costs and by the payment OF
interest charges on additional capital
investments, which have been incur
red in the attempt to develop greater
efficiency in operation, and because
of public demand as to safety and
quality of service.
1T is now our purpose to disclose
that any decline in operating or net
income has not been due to the causes
set IOEln by the IdlIIOdIS, Sc1Q llS
Statistics already read into the testi-
mony by experts employed by the
brotherhood had shown remarkable
gains in railroad revenue and the
amount available for the increased
compensation of labor.
We shall show he continued,
that the constant tendency has been
for those in financial control of the
railroads to absorb revenue gains arts
ing from increased productive eff
cheney by the issuance of fictitious Sc
curitieS; that the productive efficiency
of the men working today, the operat-
ing officials as we'll as the employees,
had already been hypothecated and
capitalized before we were born; that
measures have already been taken by
the issuance of fictitious capitalization
to absorb the increased work and pro-
ductive efficiency of our children and
our childrens children; and that there
is no hope for the engineer and fire
man and ether classes of railroad en-
ployees to secure an equitable partici-
nation in the fruits of their work, so
long as the present financial control
and administration of the railroads is
unregulated. IN other words, that any
advances which the employees have
been able to obtain in wages or earn
ings have been of no financial signifi-
canoe as compared with the indefen-
Sible absorption Of operating gains by
the financial management of western
railroads.
Finally, we shall show that if gains
from past productive efficiency had
been properly conserved and admins
tered. enormous advances could be
granted to all classes of railroad en-
ployecs, both organized and morgan
lied, without prejudice to the inter
ests of the owners of the property,
and the financial status of western
railroads today from the investors
standpoint would be all that could be
desired.
THE points we shall submit in this
connection are:
''First-That the proceeds from the
munificent grants of land by the fed
eral and state governments to assist in
the building of western railroads, were
not properly used, but their value, as
we'll as the increased business aris-
ing from the development of western
territory. was capitalized by the flota-
ton of fictitious securities.
s'Second-That the direct financial
control of western railroads, and the
potential control of the economic well
fare of their employees now rests with
a small group of bankers and finan-
cial institutions, which make and I'M
make railroad presidents, and which,
by their methods of administration of
the railroads, have absorbed present
and future revenue gains of employees
by the issuance of fictitious securities;
in other words, employees and Operat-
ing officials are the victims of finan-
cial administration.
''Third-We shall show from the
Dublicly expressed opinions of eminent
financiers and financial experts that
this present inequality in the distribu-
ton of the output of the industry is
wrong.
showing that despite the financial
cesses of railroads in the past, that
they are still financially able to pay
reasonable and fair increases in
wages"