Rock Island Argus. (Rock Island, Ill.) 1893-1920, 1919-07-17
PLUMB PLAN is
CONSOLIDATION
INTO ONE ROAD
Differs From Government Owner.
ship in Essential Features,
Not Bonus System.

When Glenn E. Plumb. general
counsel for the organized railway
employees of America, speaks in the
Empire skating rink here tomor-
row evening he will make clear
many sides OF the Plumb plan for
unification of United States rail-
roads which are generally not I'M
derstood.
1t is thought by many that the
Plumb plan proposes a federation
Of the roads of the country similar
to that in use under the govern
ment operation plan inaugurated as
war measure. 1t is true that the
desirable features of this organiza-
ton still remain under the new
plan, but the changes in financial
distribution and in organization of
operation are revolutionary.
Questions concerning details Of
The plan and the answers given by
Mr. Plumb are printed in circular
sent out in connection with the
speaking tour. To the queries,
Does this mean government opera
lion? What becomes of the profits !?
Is this a bonus system? and Why
anger rate of dividend" he an
sWers:
ut is operation by a board in
which those having the RESPONSE
bility have also the authority. It
is superior to government opera
ton because it prevents control by
an inefficient bureaucracy; and is
more democratic. since it gives the
men engaged in the industry voice
in its management.
After operating expenses are
paid and fixed charges are met, in
Guiding the interest on outstanding
government securities the surplus
IS divided equally between the gov
crnment and the men. Strictly
speaking this is not profit, since
the corporation has no capital.
What the men receive is a dividend
On efficiency.
at is giving those who increase
production a share of the results
their increased effort has produced;
and this share is theirs for as long
IS they are actually in the service
and is not forfeitable.
Because it serves as a greater
stimulus to the group with the most
sponsibility And since the oper-
ating officials would lose dividends
If wages were increased it acts au-
tomatically to prevent collision be-
tween labor directors and the oper-
ating directors to outvote the pub
lies directors in raising wages be-
vond a reasonable level. The chief
argument against the plan is that
the public loses control of its own
property, and that the men in
charge cannot be prevented from
combining to pay themselves extor-
tionate wages. This method of
sharing dividends sets up a natural
barrier against collision"
Control by Boards.
Operation Of the roads will be
effected by a board of Is directors,
five named by the president to rep
resent the public, five elected by
the operating officers and five elect
ed by the classified employees. An
other set of boards each composed |
Of five members Of the operating
officials and five members from the
employees adjusts disputes between
officials and men. In case of fail
ure to reach an adjustment, the
case is appealed to the directors.
1.-The operations of finance neces-
sary to secure public ownership and
operation under the Plumb plan |
are arranged SO that all proceeds |
above operating and standing ex-
penses are divided equally between |
employees and the government |
Railway rates will be much lower |
than at present, or in fact just !,
enough to cover the costs of rum |
ming the roads. Economists agree |
that this is handling the natural |
monopoly known as the railroad in |
accordance with its ability in large !
scale production. These things will |
be explained in the addresses of !
Plumb and Garretson tomorrow |
night"
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