Democratic Sentinel, Volume 1, Number 26, Rensselaer, Jasper County, 10 August 1877 — THE DRAWN BATTLE. [ARTICLE]

THE DRAWN BATTLE.

Will tlio Kailroad Managers Keinember Hie Lesson that Has Been Taught Them ? [From thejjew York Times.] Nt? < >ae nt’dtendi that these reductions, tryihg m»4lta*Jiave been, and these supplementary regulations, cruel as they are, have be<?n resorted to by Die companies in sheer wantonness. Most of them arc more or less embarrassed. We have Mr. Vanderbilt’s admission that the trunk lines tributary to the Atlantic cities are in excess of the legitimate wants of trade. In other words, th< railroad business, even in the older States, has been overdone. Their exigencies have prompted managers to compete in a way that entails loss upon all concerned. Evidently, then, the companies, considered only with reference to their inevitable expenses and their actual receipts, are in a condition that calls for rigid economy. Bring everything down to “hard pan,” and their in these times would call for eKtjenic thrift and care. So much the work men seem generally to have understood, as their concurrence in reductions shows. The great misfortune of the railroads is not that business is dull and comparatively uprofitable, but that they are required to face hard times burdened with the consequences of former errors of management. They are organized on a basis whieK presupposes a continuance of the era of inflation. They added enormously to their bonded debts, entailing fixed charges from which tliere is no escape stive through bankruptcy. They entered into leases and guarantees which are now so many millstones about their necks. To crown all, they capitalized their stock according to the then inflated values and the exceptional amount of their earnings. The stock thus largely “ watered” naturally craves dividends; and, as one of the conditions of good credit, a company spares no effort to enable itself to pay them. Hence the . exigency fix m which direct and indirect reductions of wages proceed. There is an obvious danger that the road itself will be neglected and that desirable improvements will be postponed. On this point an outsider cannot pretend to have positive knowledge. But the fact is undeniable that to pay interest on their bonded debts, to fulfill specific contracts, and to check the depreciation of their stocks, the companies are obliged to reduce their pay-lists to tlie lowest possible limit. The enect upon the condition of the workmen is ignored by the companies in their natural anxiety for their own solvency. If the whole matter ended as it now is, we might accept the cessation of the strike, however 1 nought about, as a positive deliverance from danger. This we cannot do. For, while ’tis ceHwflV that the lowest practicable point of wagereduction has been reached, it is not at all certain that, with business in its present condition® the companies can congratulate themselves upon tho completeness of their escape from peril. ’ Their managers, if prudent, will therefore direct their attention toother modes of relief from financial embarrassment than that which is gained at the expense of their workmen. The duty is unwelcome, but it cannot be much longer postponed. Every other great interest has in one way or another adapted itself to tlie altered condition of affairs. All are compelled to recast their accounts with reference to tho shrinkage that has occurred. The turn of the railroad companies is come. They have cut down wages, and if the reduction operate equitably the world will hold them justified. When the time arrives for another application of the screw, their wisest course will be to revalue their properties, and to reconstruct their 1 lalance-sheets in the light of the amended valuation.