Evening star., 1932-03-08

nortation and finance that have been
I,erroitted bv the Government have not
been in the interests of efficiency and
reduced cost of production. They have
been rather banking consultations for
the purpose of selling more STOCKS ano
bonds and to establish monopoiles ana
monopolistic prices. These corporations
are created by the state. IN Garner
years their powers were guaIoeuly gwen
exercise and the restrictions they should
observe were stated in the acts con-
ferring the chartering powers. Inc
laws have been changed at the penest
of the persons asking for charters, or
the courts have been Negligent IN en-,
forcing restrictive provisions. Disregard
of the restrictions as TO SounoteSS oI
capital and limitation OF earnings Is
one of the largest factors IN bringing
on the present depression. AGAIN anu
again we have read of the stock dlvl-
dend. which is the turning OF excess
earnings into capital stock. Ihese pe-
come fictitious mortgages with winch 70
further attack the income OF the people
Justice requires that the people shall De
protected against these creatures OF tlle
state who have put false values INTO
their capitalization through conSohoa
tions. stock dividends and notation ol
new capital issues. The corporation Is
a creature of the state. and it has no
rights outside those given 1t by the
state. 1t must be regulated IN ltS
activities; it must be restricted at the
time OF its creation and regulated and
controlled through its life. They have
to some extent become more poWerful
than their creator, and if permitted to
increase in influence and power Will
destroy the Government that created
them.
For instance. the price Of steel rails
is an index Of the principal steel PROD
ucts. The price of rails from 1901 TO
1915 was S28 ton. In 1928 1t reached
the price of S54 a ton, and from 1923
to 1881 the price was $45 ton. The
average price for 80 years was $50
ton 1 am advised from what l con-
slider the best source of information on
the subject that if the steel industry
would be satisfied with fair return on
an honest capitalization steel can be
placed upon the market and sold for
$40 a ton.
IF the steel and other industries
would be satisfied with a fair return on
an honest capitalization, the railroads,
farmers and other users OF steel would
be in much better condition than they
are now.
THE need for new laws relating to
corporations doing business in industry
and commerce, and for the control OF
the corporations, at least so far as
capital issues and consultations are
concerned, by the Government is urgent.
Such control will give greater conf
dence in corporate investments, dis
tribute excessive earnings in wages, give
stability to industry, as we'll as wolk
out the purposes of justice and honest
dealing in the business world.
The inevitable stagnation OF COM
merce resulting from the Incompatible
policies of exporting capital and at the
same time increasing tariffs increased
unemployment and decreased purchas-
ing power.
LAS a result of these policies, aided
by an unwise policy of credit imitation,
we drifted into the inevitable collapse
and the depression. As a result We
have vast armies of unemployed labor
We have default in debts, public and
private: paralysis of our credit system
increase in the value of money and the
depression grows in intensity and force
1T is not true that our troubles are
due to the mistakes of Europe. The
depression started here and increased
in force for five months before it hit
Europe.
Now, the question that arises is how
best to overcome the depression, re-
store prosperity and balance the bud
get? Many honest people would have
us believe that the best way to balance
the budget is to raise taxes and reduce
expenditures of the Government. Re-
6uction of expenditures is always COM
dol 11lIt that
most of the Government expenditures
are fixed charges to pay for our part in
the World War and past wars. In fact,
more than rs cents out of every dollar
that is paid the Government in taxes
goes to pay the interest on the war
debt, the interest on that part of the
debt that we Cancelled to foreign gov
ernments and other fixed charges Incl
dental to the war and to maintain the