The public ledger. [volume] (Maysville, Ky.) 1913-1968, 1916-09-18
MAY Make Capital Timid

CUBA.
May Make Capital Tlmid
Since Congress enacted the so-cali.
ed eight-hour law the question has
frequently been asked what the eff
feet of this statute upon capital in
vestment is to be. AS the law does
not go into effect until January l, 1917
there may be no noticeable immediate
influence occasioned by 1t upon capital
investment But the impression which
commonly obtains is that should Con-
gress or the Interstate Commerce
Commission not provide some means
by which the increased expenditure
to the railroads occasioned by this
law can be secured then the law will
serve to make capital more and more
timid respecting investments In rail
road securities.
The eight-hour law is not likely Ia
affect Investment of capital in in
dustrial properties. In fact, many OF
the industries are investing part OF
the profits they have secured on ac-
count of their war orders in eXpan-
sions of plants and also in improve
ments of them. This is noticeably the
case with the Bethlehem Steel Com
pany, all of whose large investments
of capital in expanding its plants, es-
pecially along Chesapeake bay, are
taken out of earnings. There will be
no impairment of capital invested IN
automobile manufacture. The uses 10
which the self-propelled car is put are
SO many as to make q certain IN
creased market for the output.
Prices of Cars Decreased
1t is a curious fact that while prices
of commodities of all kinds. with a
single exception, have increased and
so greatly increased as to represent
twenty-five per cent of the profits
gained by industrials, on the other
hand the automobile manufacturers
are on the whole decreasing the prices
charged for their cars. 1t is the one
industry in the United States in which
decreases in prices have been an
nOunced within few months.
The railroads of the United States
must obtain fresh capital amounting
to ten billion dollars If the transpor-
tation of the country is to be suf-
ficiently cared for, Capital, however
has been timid about investing in rail-
road securities. II may be that the
adoption of the eight-hour law will IN
crease that timidity. Some of the rail-
road presidents-Louis w. Hill, for
instance, of the Great Northern Rail-
way System-are fearful lest the
adoption of the eight-hour law with
out allowing the railroads TO obtain
increased rates will result in putting
many of the railway system into
DdHkTuplCy. III lnlS SHoulu prove
true, then il may be that the predlc-
ton said to have been made by Sena-
tor Borah will be found to be an ac-
curate one, for the Senator appears
to be cinvinced that in the long run
the adoption of this law will prove
harmful to American labor.
Capital. of course, cannot combine
openly as organized labor Is able tC
do and threaten to remain out OF en-
ployment unless certain conditions
are met. Capital. however, acts spon'
taneously, not by any recognized
agreement by the force of common
opinion.
A Great Investment Field
Since Congress enacted the eight
hour law the statement has been made
by some In the financial district that
Il will have one unexpected effect, for
II will tend to make investment OF
American capital in the securities OF
other nations popular.
Already the people of the United
States have invested almost exactly
81 500. 100000 In the securities OF for