Omaha daily bee., 1919-09-25
Substitute for the Plumb Plan
From the Minneapolis Tribune.

The Railway Age suggests substitute for
the Plumb plan.
The Plumb plan, it will be remembered, is
the proposition that the government buy the
| railroads and turn them over to the employees
to be operated by them for their special bene-
fit. The details are familiar to newspaper
readers
What the Railway Age proposes is that the
employees, instead of accepting the railway sys-
tenn of the country as gift from the people,
buy the roads themselves. And this proposition,
it contends, is not difficult of realization as
might at first appear.
According to the details of this plan, the
employees of the railroads are now paid ap-
proximately. $3OO00OO,0OO a year in wages.
mates, has increased about Is per cent within
the last five years, while the average railway
wage, according to the Railway Age has gone
up about 80 per cent. That is to say, wages
have Increased one-hfth more than the increase
in the cost of living. Let the employees save
this one NTH excess of compensation over liv-
ing standards of FIVE years ago and their total
annual savings would aggregate $600000000.
The amount of railroad stock outstanding
in the hands of the public June 80, 1910 was
So,3l 100000. 1t is probably not much more
now If the employees were to save $o00,000-
600 year and invest it in railroad stocks and
also invest in stocks the dividends they receive
from their stock they might, in five years, own
S3,3s0,O00,0OO of stock, or majority of all the
stock outstanding This would give them con-
troll of the railroads of the United States If
other tive years or less would give them the
ownership of all the stock of all the railroads.
his calculation assumes of course, that
they would pay par for the stock, but, as a
matter OF fact, the undertaking would be much
easier because the largest part of the stock is
below par. Of course the heavy obligations
against the railroads are bonds That is an
interest which the employees might acquire
more lesurely, inasmuch as it is the stock
which gives control of the properties.
This plan is commended by its author in
preference to the Plumb plan not only as
fairer deal to the public relieving it of the bur-
den of purchasing the railroads, but with con-
troll acquired in this manner, the employees
would be more vitality interested in the sue
cessful, efficient and profitable operation Of the
roads. 1t would be up to them to make the
wages which they contend they are entitled to,
there being no government owner to fall back
on and, at the same time, to maintain the eff
lciency OF the roads as to encourage their
use and keep up their earnings There induce
ments. it is evident, do not exist in the same
degree in the Plumb PLAN
OF course it will not be suggested from any
quarter that the railroad securities are not
safe investment for the employees, for that
would argue that railroad securities would not
be safe investment for the savings of the
American. people-which the Plumb plan pro-
'oeSo' NAoiCo'el, what IL they are not a SAFE
investment for the employees, becomes of the
claims of enormous profits which the spokes-
men of the Plumb plan assures us are made by
railroad owners?
It is also suggested that if the Plumb plan
promises economies and efficiency, much more
would this be the result if the ownership of the
properties were in the hands of the employees
themselves, because of the direct self-nterest
involved.
We doubt very much if this proposed sub
stitute for the Plumb plan will be accepted
Immediately by the railroad employees, but it
has, many things on the side of correct bust
ness principles to commend it which the Plumb
plan lacks.