The Daily Worker Newspaper, November 14, 1925, Page 10

By MORD WILGUS. PART II. Profits in the Railroad Industry. N order to arrive at the actual rate of profit and the total profits for any given year, it is imperative to know exactly how much capital—not watered capital but real cold capital —hag been put into the enterprise. The railroad; magnates claim that. 22,- 000,000,000. dollars have been “in- vested,”"(AStronomital figures of that kind may be «necessary when one studies the celestial bodies but. cer- tainly when dealing in cold cash; it is a ‘horse of another color. What do they mean by 22 billion dollars “in vested”? -Have these capitalists for- gotten the enormous grants of 155, 273,560 acres’ of public lands which they bribed ‘the congress and the state legislatures to “vote” them? Have these captains of industry lost their memory about the extension of state credit to them—a direct violation of the constitution—enabling them to build the roads with the state’s money as in the case of the Union Pacific which received $23,213,000 in govern- ment, bonds? And have the railroad kingg lost sight of the fact that what- ever. original “investments” were made have been repaid in interest and dividends many times over? HE imagination is staggered when confronted by the unheard of cor- ruption, bribery and trickery which marked fhe construction of the rail roads. The M’Cormacks, the Macys, the Mortons, the Pullmans, whose des- cendants today are looked upon as “honest” and “respectable” million- aires, were directly involved in enorm- ous embezzlements of public property. The records of this gentry as given in detail by Gustavus Myers in his work “History of American Fortunes,” are unparalleled for shameless corrup- tion, so far‘as we can make out, in all history. It makes the old Roman aristocracy look like pikers in com- parison. Let us take. one exampl The Northerf*Pa@#b fifiroad was granted 200 feet of public land on each side of its tracks along the entire road in 1864. As the road was in the process of construction, numerous villages and towns grew up alongside without the slightest protest by the railroad of- ficials. Naturally this caused the value of the fand to increase many times. Suddenly in 1877, the railroad brings suit to eject all the so-called tres- passers and the supreme court, faith- ful to the interests of the capitalists, upholds its contention. The result was that the towns and cities had to pay millions of dollars in tribute to the railroad magnates or be sum- marily evicted. What was this but trickery by the railroad pwners to en- rich themselves at the expense of the public? J NOTHER important fact to re member is that practically all of the failroad stock now outstanding represents no capital at all. The method of financing railroad construc- tion consisted of a public offering of bonds with stock génerally given away free. According to the U. S. de partment of commerce, the “stock,” both common and perferred, of the railroad for the year 1922 was valued at over $9,000,000,000. For this imag- inary “investment” the investors re- ceived for the year 1922, $275,721,615 —all velvet on fictious or watered stock. To give the reader an idea of what an enormous tribute the capital- ists are forcing from the public—that is to say the working classes—we will give the dividends as paid year by year starting wi% 1908: wo . Dividends , Yeat.doact Declared June 30,1908 i, anjuce x $329,062,261 © 5 M909 vinnintntanrenies’ 272,043,499 1910 Keraictnrsreeere 351,202,272 1911 dcmmmnreere on 403,417,363 1912 ocvenneeerser 347,354,133 1913 draramenvniainere 327,967,396 1914 inmnnnnrsrsemee 380,339,400 1915 vnccersrmriaancsivee 264,267,107 1916 vr caraseneme 268,618,168 TOCA oo receereqrenmneennnennnrn 9 2p944,37 1,599 Dec. 31, 1916 rrnnannennesne 311,876,409 1917 neneneraranere ow 325,600,752 1918 srnmetsenwmnnye 279,929,286 1990s cee sae 281,569,422 1920 Aon ecerseeeneen 275,348,254 1921... 403,990,775 1922 ina 276,721,618 Grand total ...........__$5,098,408,112 8 ae dvr in the space of fifteen years the tribute paid to the capitalists is well over. five billion dollars. It is a tribute because there is no prétense here of any investment even in the capitalist sense of the word. It is legalized robbery enforced by a gov- ernment pledged to uphold and’ ‘per- petuate this frand at the expense of the ovewhelming mass of the popula- tion—the working class, Marx point- ed out long ago that besides the “honest” profit of enterprise, fraud may also be employed by the capital- ists. In the case of the railroad in- dustry in the U. S. this fraud has been carried to its highest possible deve- lopment with the aid and connivance of the government at Washington. now come to the fixed charges on the railroads in the form of interest on the funded debt. From the years 1891 to 1922, the yearly in- terest charges for all Class 1 roads have been between $221,500,000 and $538,594,000. The total runs into, bil- lions afid if original investments only be considered, they have been fully repaid many times. y ‘ Let us now place the wages and profits side by side and observe the: great discrepancy between them. We will take the figures for the year 1922 as those of 1923 are net. avail- able: Total Wages Paid by Roads (1922) $2,672,157,000. Total Profits Distributed by Roads (1922) Interest ...... s-ee-538,594,000 Dividends ........c.0.e0 ehbibentes 275,721,000 PORE Hiviricticctducutioue $814,315,000 HUS over 23% of the gross earn- ings of the roads(after deducting de- preciation, replacements, rents, taxes, ete., and excluding profits from coal mines, etc.) was allocated to the pockets of the capitalists. Are we to ‘seek further for the reason why a majority of the railroad workers are paid below the minimum subsistence wage? Are we to stand agasp and wonder why men working day in and day out in the glare of the sun keep- ing the road beds of the country in working order are paid below $25 per week for thetr ardous toil? Are we to be amazed at the “inability” of the roads to pay its workers a living wage when over eight hundred million dollars and more each year are allocat- ed to the coupon cutters of Fifth and Park avenues and their counterparts all over the: country? Criticism. T will not do if pondering oyer these facts we grow excited and lose our heads. Indignation alone will never ‘bring capitalism to heel. It‘is’ necessary to direct our discon- tent in the channels of militant or- ganization; in awakening the masses of the railroad workers to their pro- letarian duty, To acgomplish this ob- jective we must intensify our propa- ganda among the oppressed and low- paid railroad workers first. The prop- aganda must not deal exclusively with lhe hnrerianictacn testes Wages and Profits in the Railroad Industry abstractions as in the past but. must present to railroad workers actual facts and conditions in the industry. The watered stock, the enormous to- tals in dividends and interest paid out must be shown not only for the roads as a whole but for the individual roads in particular in order to arouse the interest of the workers on the in- dividual roads more effectively, All around wage increases of 26% to be demanded at once! HERE exist nominally sixteen standard railroad unions,,But out- side of the Big 4 they are weak both in organization and numbers, Hence: our immediate task is to get the workr::4 « ers into the unions. “Into the: unions’.:f.:) must be made a national wherever slogan railroaders. «congregate, Coupled with this, propaganda .urg- ing the amalgamation of all the six- teen railroad unions into one powerful industrial organization must be in- tensified. The fraud underlying the company unions and the B. & O. plans must be systematically exposed. And within the unions, agitation for a la- bor party to defend and extend the political power of the workers in their struggle against capitalism must be initiated on a major scale, ————_— Foreign Exchange. NEW YORK, Nov, 13—Great Brit- ain, pound. sterling, demand 4.84 5-16; cable: 4.8411-16. Frante, franc, de- mand 4.06%; cable 4.07, Belgium, franc, demand 453; cable 4.5344; Italy, lira)» demand 4.04%; cable 4.05, Sweden, krone, demand 24:72; cable. 26.75. Norway, krone, demand 20.18; cable 20.20, Denmark, krone, demand 24.73; cable 24.75, Germany, mark, not quoted, Shanghai trade, 78.75, ee