The daily worker. [volume] (Chicago, Ill.) 1924-1958, 1924-04-19
BIG RAILROADS
RUIN SERVICE IN
CREED FOR PROFIT
Lay OFF Thousands
OF Men.
BY LELAND oLDs.


Federated Press Industrial Editor.)
The extent to which private oper-
alton of the railroads tends to en-
throne profits above the interests Of
shippers and employees is revealed in
the reports of two leading carriers
to the interstate commerce commits
sion. During the first two months Of
1924 the New York Central and the
Pennsylvania have reduced the pro-
portion OF the shippers dollar used
to provide for adequate service and
have laid off thousands of men in or
der to squeeze out a larger net in
come for stockholders. This resulted
in a serious impairment of equip
ment.
Compared with the first two months
of 1923 the Pennsylvania has in
creased the proportion Of the ship
per's dollar going to profits from
1873 per cent to Ill per cent. This
means a decrease of nearly per
cent in proportion of the shippers.
dollar used to provide for safe and
expeditions handling of shipments.
The proportion Of the dollar used to
maintain cars, locomotives and road
bed dropped from 1872 per cent to
35.1 per cent and the expenditure for
maintenance of equipment decreased
by $3,355,752.
All For Profit.
The New York Central increased
the proportion Of the shippers dol
lar going to profits from 1871 per cent
to 21.2 per cent. The extra profit
was made largely at the expense Of
equipment. The proportion Of the
dollar going to maintenance fell from
S5.S per cent to SO per cent and the
reduction in expenditure on the re-
pair of cars and locomotives amount
ed to s3,37O,646.
The Pennsylvania shows the most
rapid deterioration Of equipment as
result of this policy. Between De-
cember and February the proportion
in unserviceable condition has in
creased as follows: Freight locomo-
tives from IT'S per cent to 21.1 per
cent, passenger locomotives from 1876
per cent to 1877 per cent and freight
cars from SO per cent to IA per cent.
During the same period the fol
lowing changes in the proportion Of
New York Central equipment in bad
order were reported: Freight locomo-
tives from 22.5 per cent to 25.4 per
I cent, passenger locomotives from 21.9
per cent to 1871 per cent and freight
cars from SO per cent to Az per cent.
When it is recalled that railroad ex-
ecutives proclaimed Is per cent of
locomotives and 4 per cent of cars as
bad order ratios which should not be
exceeded the recent reduction in ex-
penditures involving the laying off Of
thousands of repair men appears
without excuse.
Pennsylvania Profits Grow.
The results will win the praise Of
stockholders. Pennsylvania profits
for the first two months Of 1924
amounted to s11,S11,O71 as compared
with only SS,413,3S1 for the same pc
Rod in 1923. But last years total
profits reached sSS,065,252, exceeded
only once in the railroads history
and gave common stockholders a re-
turn of more than 10 per cent. The
owners can hardly request a larger
return this year.
New York Central profits for the
first two months amounted to $S,222,-
246 as compared with s7,734,645 a
year ago. But last years profits
when complete amounted to s45,SS9,-
427, giving common stockholders
nearly II per cent on their money, SO
here again squeezing necessary ex-
penditures is not justified.
There is, perhaps, another explain
alton OF this effort to wiring all the
profits possible out of the early
months Of the year. Financiers back
LOT the management may see a bust
|, J ness slump ahead and want to pile w
profits early in order to pay dividends
as usual even tho traffic decreases
BY laying off men and decreasing ex
, penditure on equipment they increase
the probability of such slump. And
they are well aware Of this.