Evening star., 1955-07-13
Views of Tronsit Strike

problems. Our problem is not
a unique one, but is shared
by many cities CLOS Angeles
and Buffalo have had strikes;
Boston's city-run transit sys-
tenn raised its token rate from
18 cents to 20 cents and New
York's transit system receives
an $87.O0o,000 subsidy this
year.
If Mr.. Wolfson hadn't paid
out the earned surplus in
dividends, would the picture
be any different today? No.
The company still could. not
afford to operate at a loss and
make up the difference out of
earned surplus for very long.
Besides, for what moral or
ethical reason should 1900
stockholders subsidize the
transit system with their
earned surplus? A public
utility should provide public
service but not subsidies or
charity.
Actually the earned surplus
has been used to keep divi-
dends in line with what the
Public Utilities Commission
deems fair. So. therefore. by
relieving the riding public from
this charge. the company is
actually subsidizing it's own
dividends-thereby substituting
the riders.
The company has been
knocked from pillar to post in
this strike. What has it done
wrong? It only asks for a
fair return on a fair value, as
judged by the PUG. It gets
a small fraction of that return
and much abuse. Instead of
acting promptly on company
affairs, the PUG, Congress, and
Senator Morse sit around and
figure L. E.. Wolfson's income.
The PUG is supposed to reg
ulate public utility returns
not L. E. Wolfson's returns.
Had Mr.. Wolfson bought the
stock at a price above book
value, instead of below it, the
PUG wouldn't have readjusted
the rate base upward. Why do
the public and Senator Morse
wish to readjust it downward
because of a favorable stock
market transaction on Mr..
Wolfson's part?)
Let us all seek a solution
which could. serve as a model
to other cities. Berating Mr..
Wolfson is not the example
to set--for not every city has
a Mr.. Wolfson.
r, b. Protas.
X II X 4
We are faced with q revival
of.the old robber baron busi-
ness philosophy of the late
10th and early goth century.
The idea that a business is
just a dividend machine is an
appealing notion, especially to
stockholders. AT the present
time this revival is symbolized
in the person of Louis Wolf
son. Will this evil philosophy
develop and gain strength or
will the people take a stand
against it. as the stockhold-
ers of Montgomery Ward did?
Will getting rid of Wolfson
change the attitudes of the
stockholders who support
him? Can a legislator pass a
law that will change their
minds? The. question always
seems to be what will the Gov
ernment do. Is it too much to
ask that people advocate their
responsibility in the face of
Government? The old-fash-
ioned town meeting has finally
gone out Of style, and we now
leave everything to Govern
ment. Will a law stop the in
veStors in Capital Transit from
putting in another Wolfson?
We have the responsibility and
the right, as ordinary citi-
zens, to take a stand. Why
don't we?
Bruce r.. Stewart.
Commenting on the wishful
thinking Of current transit-
seizure talk, The Star in its
editorial. Seizure Talk" sum-
marizes the long suffering pub
lies dilemma: g. as yet,
Congress has failed to find a
method Of avoiding such ac-
compartments of the right of
an employer to refuse to meet
union demands or the right of
the union to enforce its de-
mands by striking" Obviously
Congress is in dictatorisl con-
troll. in ,democracy's voteless
capital. And If seizure will not
work, how may Congress
discipline Wolfson's predatory