The Connecticut labor news., 1922-03-24
JERSEY, STABLE-CLEANING POLITICIAN
GETS ERIE ROAD REPAIR CONTRACTS
ON BIG GRATING COST-PLUS BASIS

and fast provisions to control this i'm
portant element All that is demanded
Of the contractor is that he advise the
railroad at stated intervals the amount
he is paying workers, the number en-
ployed, and the service rendered. The
railroad then figures out how much these
workers have received had they been
paid at the rate of wages prescribed by
the Labor Board. The difference, &C
cording to the formula, is termed say
ings" That is al there is to it. A
simple arithmetical exercise.
But there is vastly more to the con-
tract so far as the public and Erie
stockholders are concerned. They may
discover that there are no real savings
but rather greatly exaggerated costs for
units of service rendered.
Wagner may employ hundred in
ferior Workmen at his lower wage who
will not deliver as much service as so
competent men receiving living pay and
still be given credit for having made a
saving" The number of men en-
ployed, not the service they render,
makes the measure of Wagner's say
ings" and his profits.
This gives unlimited opportunity for
the padding of pay rolls. The more men
the contractor uses the larger will be
the savings" The more wastefu and
extravagant the methods in force the
larger will be the sum for division be-
tween Wagner and the Erie.
EaerythD.g Helps Contractor
Reduced morale, inevitable under the
cost-plus contract, is all to the contrac-
tors benefit If the Individual worker,
heartsick because Of the intolerable con-
ditions imposed upon him, produces less
than he would under more satisfactory
conditions, additional labor will be re-
quired, and that will automatically ado
to the savings fund set up for the
contractors benefit.
Wagner must effect savings" of /;
per cent before the Erie can participate
to the extent Of i per cent.
In other words, before the stock
holders of the railroad can enjoy any
benefit Wagner will take a sum equal
to the reduction in wages that is now be-
ing urged by railroad officials in hear
ings before the Labor Board.
In addition to the opportunity to ex-
plot labor in an open and above-board
manner, Wagner's generous contract
also gives him freedom to exploit the
stockholders and the public if he elects
to take it. Viii he do it? That depends
upon whether the railroad management
has undergone any radical Improvement
in morale during the past few years.
.4re Rail Officials I,rvolq,ed
1t is not possible to say whether any
officials of the Erie are actually behind
Wagner and are financially interested
in his fat contract. That can only be
determined by an official investigation.
But there are official records of numer-
Gus instances where railroad officers have
been the chief benehciaries of cost-plus
contracts. Millions Of dollars have been
taken from railroad stockholders and the
inexperienced nobidies who were willing
to be the tools Of scheming railroad
managers.
Before the Erie picked out a local
politician for this work it approached a
nurnbtr Of other citizens of Jersty City
with tenders of contracts. A prominent
leader of the workers was among those
invited to become dummy for the cost
plus arrangement He declined because
hit recognized the nature of the deal.
AS it lays the Wagner contract is open
to the deepest suspicion. What is the
Erie's interest in this man, that it gives
him the benefit of unlimited opportunity
to make large profits for himself at the
expense of the workers?
Hate Doesn't Explain Deal
The answer to that question involves
something more than a determination to
force labor down to a starvation level.
The presumption is that the Erie would
not deliberately destroy the morale of its
workers, heretofore its best asset, for no
better reason than that politician, with
no known experience or skill in the i'm
portant work of repairing cars and To-
cornotlves at the nations most Congested
terminal, should make for himself a
large profit.
If the Erie is not, therefore, playing
Santa Claus to Wagner, what is back of
this iniquitous cost-plus contract?
1t must be apparent that no advantage
will accrue to the railroad, for. admit
ting that all other conditions will re-
main unchanged, it is inconceivable that
Wagner can cut the pay rolls to a point
where he will secure his guarantees and
leave anything for the railroad
The railroad can not possibly hope t.
gain anything in a financial way. 1t
stands to lose the most valuable factor
| in shop management, - loyal, efficient
and contented workers.
The answer to the riddle may be Civ
en- when it is known whether officials
Of the railroad are hiding back Of the
gloriied Horse Manure Company.