Evening star. [volume] (Washington, D.C.) 1854-1972, 1940-10-14
Presents Own Version
Of Forgotten Man.
Cites Pennsylvania RoiIrood
Report to Refute the
Critics of Business
To the Editor OF The Star:

To the Editor Of The Star:
We hear much, and read more, about
the rights Of labor, higher standards of
living, minimum wage scales "the for
gotten man." and the like. We have
seen for seven years past a persistent
hostility Of this administration to bust
ness, particularly on the part Of the
Chief Executive. and We have noted the
tendency OF the administration and
Congress to impose upon business, and
especially the great corporations of the
country. an enormous burden Of taxa
tlon-folloWing sort of soak the
rich" plan. Indeed, I wonder what the
average voter thinks about big corpo-
ration, after politicians-for vote-getting
purposes-berate 1t and exaggerate its
wealth, greed, etc. I venture to say that
they are ignorant of the fact that in most
OF these corporations the stockholders
outnumber the employees two to one, hut
come out at the small end Of the horn:
that the taxes paid constitute as large, Il
not larger, rate per share of stock than
Is paid in dividends, and that II there is
falling of of earnings it is the stock
holders who suffer most.
1 am going to give an example Of
what I have said from the report Of
one large corporation, which needs no
comment, which speaks for itself.
1 have before me the report OF the
Pennsylvania Railroad for 1899. On De-
cember 81, 1885, there were 2O9 346
stockholders. The average number of
employees for that year was los 1892. The
total compensation paid was s2O6,721,-
1888. After the payment of that sum
and the other operating expenses, in
terest or the company's bonds, ETC., the
net income of the company before pay
ment of taxes was $72,128374 Out Of
this net income there was paid to sink
ing and reserve funds and to leased
roads over s800O,OOO and $4,000 900
was turned over to the profit and loss
account, against which was charged
over s5,O00,000 for property retired from
use, etc. The net income Of the railroad
for distribution was $50 ,263 sol. Now
what did the 209, 346 stockholders get
out of this sum? They got 81 share
in dividends, amounting to s13.167.754,
and the remaining $40,095 BAT (eouiva-
lent to s306 a share on the stock the
company paid in taxesl
To recapitulate: los, 000-odd employees
received over s2o6 900 900; 209 OOO-odd
stockholders received sI3,OOO,O 900, and
over $40 600 900 was paid in taxes!
And I venture to say that If the ma
jority of the big corporations of the
country were to publish today the sum
paid to employees, the number of stock
holders they have, the amount paid the
latter, and the sum paid in taxes. it
would be seen that the situation of this
railroad is a pretty fair example of the
situation of many of these greedy and
rapacious" corporations
But we hear nothing said about pro-
tecting the army of stockholders, who
far outnumber the employees and receive
less than the Federal and State govern
ments do in taxes paid them
1t was the money these stockholders
and those who first invested that helped
enable the corporations to carry on and
employ millions of men.
And it is the stockholders who have
to pay for increased taxes and labor
cost. They seem to be the forgotten
men-and women. But they can vote.
CHARLES L. FRAILEY.
October H.