People's Pilot, Volume 2, Number 45, Rensselaer, Jasper County, 28 April 1893 — WAGES AND PROFITS. [ARTICLE]

WAGES AND PROFITS.

Profit That Amount to Fair Wages Only Are Legitimate and Do Not Rob Labor. There seems to be a strange misconception as to the nature and identity of the factor Profit, which economists have in mind when they state that the factors which conspire to rob labor are Rent, Interest and Profit. An unnatural enmity and jealous rivalry exists between labor, as wage-workers, and labor, as employers, or “exploiters,” and, more foolish yet, between labor on the farm and labor in the cities and towns. As declared in the preamble to the Omaha platform: “The interests of rural and civic labor are the same; their enemies are identical.” The true economic definition of legitimate profit is wages. Legitimate profit does not rob labor, because it only secures "fair wages” to industrial managers or "exploiters" of labor. A full and exhaustive discussion of the various relationships to labor of the factor profit would necessarily involve a consideration of the entire wage-working system, and would transcend the space allotted to this article. Hence I can only briefly point out some of the special features and divisions of the subject. Profit not only appertains to the exploitation of labor in productive and distributive industries, or channels, under the wage-working system, but also inheres in the distribution of wealth, by storekeepers and sellers of goods, wares and commodities, even though the seller or storekeeper hires no help. If the profits received in such businesses do not aggregate more than the average wages realized by productive and distributive labor, it is clear that such storekeeper or seller robs no one, because he renders to society or the community valuable services and receives no more from the community than fair wages for the labor he performs. Take a "boss” or employing carpenter, painter, blacksmith, printer, tinner or a small storekeeper who hires or does not hire one clerk or more, if such employer or storekeeper does not make more than a decent, comfortable living out of his business or employment, it is clear that he does no injustice to any one and robs no man. If the several employes of such men were to organize themselves into co-operative firms or societies and continue to prosecute their several occupations, the first thing they must do is to rent premises for the occupancy of the business and its materials and tools; next, they must buy material and tools; lastly, they must guarantee to one of their number proportionate average wages to pay him for his services as a "boss” or manager, to contract for jobs, collect bills, buy material, etc., etc. If they should start a co-operative store, they must rent or buy a location, lay in a stock of goods, hire a manager, clerks, etc., and pay all necessary expenses. So that, so far as the small businesses are concerned, nothing can be gained by dispensing with the boss or employer, except that more men might combine in a co-opera-tive enterprise than work for any one employer or buy goods from any one store, and so a less number of bosses, employers and store managers would suffice, and thus a saving could be effected in that direction, such saving being available as an increase to the wage fund, and to that extent increasing the wages of those who actually did the work, or making it possible for the co-operative store to sell more cheaply. The vast majority of our employing managers of productive, distributive and repairing or embellishing industries only manage, by dint of hard work, energy and, prudence, to obtain a fairly decent-and comfortable living and many thousands of them annually are pressed to the wall, fail in business and lose the small capital they had invested. Very few of them, if any, accumulate any wealth, and they are numbered with the 12,350,000 families, who own, upon the average, $1,255 to each family, and not with the 250,000 who possess, upon the average, $186,000 to each family. Rent, interest and the profit that robs the wage-worker, in like manner robs the great bulk of employers and small storekeepers. These men are not the robbers, but should be classified with the robbed, in which category they undoubtedly belong.

Where, then, shall we look for the factor, profit, which robs labor. I will tell you. Look to the vast manufacturing establishments which, after paying salaries to managers, heads of departments and foremen, after paying interest upon borrowed capital or bonded indebtedness, yet pay goodly dividends to a multiplicity of stockholders who, performing no labor about the establishment, yet holding shares of stock representing, in most cases, more than the actual value of the plant. Look in the direction of the forty-three listed trusts in the United States, with a gross capitalization of $1,352,700,000, of which $380,000,000 is water. And yet this list does not include some of the largest and most greedy trusts in the country, because no trustworthy information concerning their capitalization can be secured. Look in the direction of the street railway, water, gas and electric light companies and many other kinds of corporations, which are bonded for all or more than they cost, and yet pay, in addition to the interest upon the bonds, good, fat dividends upon a capitalization as great in amount as the bonded indebtedness. These are the profits which rob and oppress all productive and distributive labor and play an important part in the concentration of wealth in the hands of the few and the absorption of the total net annual increase in wealth. Then there are the telegraph, telephone and express companies, which must not be forgotten. It is impossible to give even an approximate statement of the profits extorted from the people by these trusts and corporations. It is estimated that the capitalization of telegraph, telephone and electric railways and electric lighting and supply companies is more than one billion dollars, the Western Union Telegraph Co. alone realizing net profits of $7,812,725 in 1890. I shall hazard the assertion that the net profits, over and above a good living for all who actually were entitled to a living out of the various industries, businesses and occupations,

amounted in the year 1890 to $385,000,000, apportioned as follows: Railroad dividends $ 85,000,000 Net profit to all manufacturing industries, 5 per cent. on four billions 200,000,000 Dividends paid by street car, water, gas, electric light and express, telegraph and telephone companies and large mercantile establishments... 100,000,000 Total $385,000,000 George C. Ward.