The sun., 1919-03-11
A. T. & T. EARNINGS
INCREASE IN 1918
Report Shows 1898 a Share
Was Made Last Year, as
; Against 1888 in 1917.
TOTAL INCOME SOL, O56, 1852.
Vail Wants Changes in Laws
Regulating Communication
Utilities Before Return.

The earnings OF the American Tele-
sohone and Telegraph Company for 1918,
according to the annual report published
yesterday, totaIled, after all charges for
anterest, &C, s43,sol.32i, or 1898
share on the s44l.s4733s capital stock
Outstanding In 1917 its earnings totalled
sf3S,471.106, or ts.S3 a share. There were
.declines in dividends received from in
Sestments, which fell from s2s,ss4,264
In 1917 to $19,527,451 in 1918. as we'll
sas in money received from affiliated COM
1anies, which declined from s19,455.2eO
.to s1s,022,220. The difference was more
than mado up In money received for ser
vice, OF which s4,726.0ss came from tel
ephone rafnc in the first seven months
of 1918 and sls,7S0,Ss6 was compensa-
ZION on Government contracts for the re-
fifaining 1--WE months. Thus the total ts
On excess of s22, 900 900, against $685.
sSG7 IN 1917, bringing the years total in
como to s61.056,162. against f5s,23I,0e3.
Contrary to the rule, expenditures for
operation were less than In 1917. being
&s,7s3.1t6, against s7.2es,59e. interest
charges were rot materially changed and
totalled slo,391, 695. Dividends for the
wear aggregated s35,229.699, an increase
,of about $4,000 900. leaving balance OF
,sSS7l.e22, from which 100000 was
appropriated for contingencies The sur
.plus for the year was $3,67i,622, repre-
senting q slight increase from the 1917
surplus which totalled s3,4Se,492.
In a statement accompanying the in
come report President Theodore ~ VAN
ss2id in part;
AT the end OF the year tho number
of telephone stations which constituted
the Bell system in the United States
was 1o.se2.s26, an increase during the
wear OF 516,647 OF the total number
.ot stations in the system 7,2o1,7o7 were
owned by Bell companies and 3.7s0,s6s
by local cooperative and rural inde-
pendent companies or associations hav-
1ns eub-license or connection contracts !;
the so-called connecting companies. In
addition to these there are about 1,0l2.-
1000 stations owned by independent COM
spanies not connected with the Bell sys-
item.
Considered Conservation First.
The supervision. possession. control
sRnd operation OF the Bell system as
.sumed by the President acting under
authority of the joint resolution Of Con-
-wress is in no sense permanent nor can
It Re likened TO a sale and purchase.
1T 10 very temporary in its nature, Tor
the property is TO be returned after
a limited period The necessity OF ample
time to prepare for common supervision
of operations was recognized and cared
for in the order of the President, which
continued temporarily the operation in
the hands of the existing organizations
The operating organization OF the
Bell system, upon which depends the
service rendered. was not created in a
limited time or for temporary period.
1t is composed very largely OF trained
technical experts whose education is a
matter OF years: II is special to the
business and there Is no. large reserve
,of ether and similar occupations to draw
Trom, An important part of this organ
'iZation ia its department OF research, in
Nestigation and EXPERIMENTATION. The
plant. equipment methods and ALI that
contributes TO telephone service are still
in a state of evolution and that evolu-
Won is so continuous, SO interrelated
with the past and in such various stages
of progress from the nebulous sugges-
'tions and embryonic ideas 10 actual ac-
accomplishment and application 10 service
,that a continuity Of this evolution under
tire san1N direction and through the same
Generalization is case OF 'self-preserva-
ton to the existing state OF the art. and
Is a guarantee OF its future protection
For these reasons. in making any ar
'rangement between the Government and
the system covering the temporary per
.iod OF control the first consideration
was preservation and conservation o.
The property and its organization. None
'tary compensation was quite second
AIRY matter.
- II will be extremely unfortunate II
With very pronounced public sentiment
in favor OF It, wire system with ma
tionwide universal. comprehensive ser
vice and complete utilization OF all th'
facilities cannot be evolved from thu
existing conditions.
No Fear of Rational Control.
TT seems paradoxical that the inter
probation and application OF existing
laws against restraint of trade should
he an obstacle in the way OF such
tremendous expansion and improvement
of the utilities o. service and necessit,
which create trade and upon which al
economic activity and all trade an,
commerce are dependent
There is no reason, providing W
nave rational control and regulation
or governmental supervision to fea
Government ownership but without
national effective control which will reg
lidte bat not restrict, control but no
T7iestroy utilities Of necessity, Govern
tment ownership is inevitable.
There is little doubt remaining in IN
4minds of the public but that regulate
monopoly Is better than unreguate
riovernment ownership, and there Ia n
longer any extensive conviction tina
sthere can he effective competition in tn
electric transm ission OF intelligence rt
- 2isa lag a 1eaA HideA1-,. versai sNstaS
whether messages or conversations.
at is essential, whether ideal cor
sbinations are brought about or not ths
shefore the great utilities of intercom
scnunication and transportation are RI
siurned from Government possession sue
echanges in the existing laws concern!u
scontrol and regulation. competition AL
combination shall bA made as will PEI
init combinations demanded by the publ
Interested when approved by the a,
.thorities having jurisdiction, particularI
.such as are necessary TO properly at
Just inequalities which will Gauge &C,
nomic and Industrial disturbance so lor
as they remain"