The Washington times., 1919-11-25
URGES PROFITS PAY
FOR Miners RAISE
McAdoo Asserts Operators
Made Huge Sums From High
Prices During War.

NEW YORK, Nov. Zo.-Declarin
hat the income tax returns OF tn
operators for 1917 show
d they made shocking and indefen
ible" profits-running rs high
900 per cent in some cases-forme
secretary of the Treasury WiliiaI
sibbs McAdoo, in a telegram, urge
'uel Administrator Harry A. CARTEL
lot to permit the, operators to shif
o the public summarily any Of tn
'urden of wage increases whic
night grow out Of the present wag'
Gale conference.
Mr.. NcAdoo urged the acceptanc
4 the new scaie-approximating
1.e1 per cent increase-proposed b
secretary of Labor William B. WI
on, but declared against saddling tn
'ublic with any of the cost until Tn
ncome tax returns of the operator
or 1918 and 1919 were made public
llr. MeAdoe's Telegran.
The telegram. in full. follows:
Reports from Washington In
dicate that the miners are willing
to accept the wage increase sug-
gested by Secretary Wilson. but
that the mine owners are holding
back until they learn from you
how much of the wage increase
they can impose on the public
through increased prices for
bituminous coal.
II am convinced that the In
creases proposed for the mine
workers are Just and reasonable,
but I have grave doubts ~ to
whether the mine operators are
entitled to increase the price OF
coal to consumers because thereon.
TN the year 1917 many mine
owners made shocking and inde-
fensible profits on bituminous
coal. 1 know this because, aB
Secretary of the Treasury. I ex-
amined in May. 1918. their income
tax returns to the Treasury. Be-
fore deduction OF excess profits
taxes-which were less in 1917
than now-these returns showed
earnings on capital stock rang
ing from Is per cent to 1000 per
cent Earnings OF 100 to 800 per
cent on capital stock were not
uncommon.
"The operators claim that their
invested capital frequently ex-
ceeds their capital stock But IL
IL doubtless true that in many
cases capital stock exceeds in
vested capital However this may
be, It IL clear that even on the
basis Of the operators claims as
to Invested capital their net
earnings In 1917 we're abnormal
wsulA Infsrn the Public.
"In . report made by the T:eas-
ury In response to q Senate rAso-
luton on pronteering in 1918
some striking facts were given
as to the earnings Of various COM
panies engaged in production of
necessaries of life, including fuel.
OF course, do not know what
the profits Of the bituminous coal
operators were in 1918 since left
the Treasury In December. These
reports were not filed until March,
1919. But II they disclose any
such profits as earned by the BIZ
luminous coal operators In 1917, 1t
would be 4 grave wrong to per-
NIT the operators to take from
the public additional profits In
the form of increased prices for
bituminous coal.
Moreover, II proflts were even
measurably as great in 1913 az In
1917, the operators can well afford
to pay the increased wages 10 the
miners and still have perhaps a
larger return upon the capital
employed in the mines than they
are justly entitled to.
I'm behalf Of the public, al
ready overburdened with tn. bigh
cost of living, earnestly urge
that the bituminous coal oper-
ators be not permitted to impose
an additional charge for coal on
the public until a careful exami-
nation has been made of their in
come tax returns filed with the
Treasury Department for the
years 1917 and 1918. 1t can be
determined from the actual .sct.
OF the case whether an Increased
charge to the public lis in anv re-
spect tustifiable.
Favors Wage Increase,
earnestly urge also that these
income tax returns be published.
They ought to be published SO
that the American people can
know what the true facts are
about the earnings OF the btu
minous coal operators. They are
entitled to this Information. and
there is no reason why it should
be withheld since the law per
mits 1t in certain circumstances,
1t can be taken for granted that
the income tax returns of these
companies are more likely to un-
derstate than to overstate net
earning power for the purpose Of
taxation.
I'm my Judgment. the wage in
creases should be promptly con-
ceded and the coal operators
should accept them and submit to
the investigation and publication
of their income tax reports, SUBJ
ject to your final determination
after all facts are considered as to
what the just price of bitumin-
Gus coal should be. II later the
facts show that an increased
price is justified the American
people will, / am sure, be willing
to pay 1t.
"In my opinion, resumption of
work at the mines should imme-
diately begin upon this basis, SO
that the American people may not
be subjected to the perils of
f,~ .f