The toiler. [volume] (Cleveland, Ohio) 1919-1922, 1920-06-04

When the coal controversy was at its ID ght,
former Secretary of the Treasury McAdoo sta tiled
the nation by declaring that in 1917 the mine OF nes
made shocking and indefensble profits bitumlnous
coal He stated that their income tax returns revfaied
that they making earnings their capital stock
ranging from Is to 1000 per cent and that earnings
of from 100 to 300 per cent capital stock were
not uncommon. Mr.. McAdOO drew his facts regarding
the profits of coal operators from Senate Document
No. 259, report of the Secretary of the Treasury IN
response to Senate resolution requesting all facts in
possession of the Treasury Department relative to
profteering. Great objection to the printing of this
report was made by reactionary Senators, who wanted
to conceal these facts from the people, and only after
hard fight by Senators Borah and La Toilette
agreement finally secured to print small edition
AS the result of this partial suppression, this i'm.
portant report, which should have been made avail
able 10 every American citizen, has been obtanabe
only with the greatest difficulty. In this article
presented the startling facts which it contains.
In the publication of this report every effort
was apparently made to conceal from the reader all
facts which would reveal the profiteering of the
great corporations and trusts The report contain 3SS
pages. In the first $50 pages you will find not a
single corporation with than $10000000 capital
ization, and very few with more than few hundred
thousand but beginning page 361 you will find
all the big trusts for which reports given Jumped
indiscrimnatey with little corporations with capital
stock small as $1,000 An inconspicuous note on
page states that the tables beginning at page Sol
relate to returns which computation had not been
completed when tie preceding tables were sent to
the printer Was it accident that all the big corpo-
ratiOns were held back while the data more than
10000 small companies compiled and sent to
the printer Whatever the reason may be- the fact IS
that any ordinary citizen examining this report
would be led to believe that all the profiteering was
done by the small companies Some question might
also be raised by inquirng citizens to why this
report does not include the big copper companies
which in 1916 and 1917 made such stupendous profits
and why other notorious prefiteers were omitted But
putting aside all such defects the report still
tains an enormous mass of information of the greatest
vadue to the American people,
Profits in Coal
An examination of the report shows that Sec
retary McAdoo entirely too conservative when
he stated that the profits of the coal operators
ranged high 1000 per cent. He should have
said that the profits ranged high 1856 per cent
He stated that profits as high as 100 per cent
capital stock not uncommon. The fact is that
nearly half the coal companies S5 out of 404) act
ualy earned profits on their capital stock ranging
from 100 per cent to 1856 per cent In other words
the prices paid by the American people for their
coal in 1917 high that nearly half the mines
reported paid profits equal to their entire
capital stock and at least of the mines paid
profits equal to IS times its capitalization.
1t is notorious fact that in many of the mining
corporations the greater part of the capital stock
represented nothing but water The stock was given
as bonuses to the buyers of bonds, and nobody OK
pected that the stock certificates would ever be worth
more than faw cents the dollar. Nevertheless
WE linu UfHC III lfli net income OF the 4U4 coal
companies reported $7s.00OO00 or nearly As
per cent of their total capital stock of $175 900
This net income is after the deduction of interest,
on bonds ard all the overgenerous allowances for
depreciation and depletion provided for in the ex
cess profits tax law Furthermore these figures are
based on the original returns of the companies and
take no account whatever of millions of doN{rs Of
tax evasions which were revealed by the internal
Revenue Bureau in auditing the returns.
With these facts before u.s. and making due all
owance for smaller profits in 1918 and 1919, it is
absolutely certain that it would have been cheaper
for the American people to have bought the coal
mines outright when entered the war so that
coal could have been sold to the people at low
cost than to have paid the enormous profits of the
last thre" years. To put the matter in different
way, in the last three years the American people
have paid in ne, oprfits every dollars worth of
stock of the coal companies.
Some Other Profiteers
The coal operators not the only ones who
were profiteering while this nation was at war and
every loyal citizen pairing his expenditures to
the bone in order to buy Liberty Bonds and provide
for the necessities of soldres and sailors While
the coal operators making profits ranging as
high as 1856 per cent their capital stock, The
meat packers were making profits ranging as high
as 4244 per cent, Of fruits and vegetables