Askov American. [volume] (Askov, Pine County, Minn.) 1914-current, 1934-04-12
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ditOr AskOv American:

Editor ASkOV AMERICAN.
Some time ago l wrote to Senator
Shipstead about passing a law pro-
hibiting high salaries such as those
paid to corporation officials. He an
swered my letter thanking me for my
advice, and also sent me some liter
ature from the Senate. This litera-
ture contained his speech on reduc-
ton of interest rates and restoration
of better financial conditions. Fur
thermOre, there were several para
graphs in his speech that certainly
made me glad. That was because
Shipstead told the Senate the same
that l have been telling people
through "Askov American Duluth
News Tribune" and Duluth Herald
The portion of his speech which l
so we'll admire, reads as follows:
There is big steel plant at Du-
luth. Buying steel bars at Duluth,
the consumer in that territory viii
pay the price fixed at Chicago, plus
$3.50 freight from Chicago and the
steel is not hauled from Chicago.
The railroads are not paid to haul
it from Chicago to Duluth; the money
is paid to the steel industry for steel
made in Duluth, and the rate falls
upon the consumer for the benefit
of the steel industry, based on the
freight rate from Chicago to Duluth,
when it is not hauled on any rail
road; it is produced at Duluth.
engaged in to maintain the fictitious
capitalization of mortgages and bonds
and stocks, the fixed charges of which
became so overwhelming that they
had, in my opinion, more to do with
bringing on the depression than any
other one thing -.
According to that, l am not the
only one who maintains that vast
profits by large corporations are not
doing the country any good. They
are not helping us to dispose OF our
surplus hogs, corn, wheat and cotton,
because the money goes to just few
corporation officials, and the cOnsum-
ers are not benefited by it at all.
Let us assume for example that
certain steel company's official makes
a net profit of five pers cent on all
the commodities that it manufactures.
That five per cent (minus his living
eXpenses) may be considered as a
rate at which the money is taken
away from the consuming people, for
any corporation official who gets
around a million dollars a year GER
tafnly cannot consume 1t all for nee
essities. He simply deposits the
money into the banks or into stocks
and bonds. That is how money gets
into the hands of a few. If that
same man gets his high salary for
several years, he accumulates for
tune.
Supposing, for instance, that his
salary were cut in half, then the leak
hole would only be half as deep, and
more would go to the laboring or
consuming people who would buy the
surplus farm products.
As | said in my article on depres-
sion and prosperity three weeks ago,
the Federal Trade Commission dis
closed the high salaries of nearly
900 corporations. OF course many OF
these salaries were around $4,000 a
year; nevertheless, many of them can
stand a cut.
Cutting these salaries automatically
puts more money into the hands OF
80, OOO, 900 people engaged in agricul-
ture and 100000 people working for
wages. At the same time, it reduces
the price on commodities that a con-
sumner must buy.
Let us assume that E. G. Grace had
his salary reduced from $1,635,753 a
year to $635,753. and G. w. Hill from
$1.O51, 900 to 100000 and the rest Of
the 900 salaries reduced proportion
ately.
Under those circumstances, 1t seems
reasonable that it would be possible
to buy a $50 stove for about $45, an
soc broom for 75c, and the same with
everything else. From that 1t is rea-
sonable to believe that a consumer
could save considerable amount of