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EXHIBIT V

AMERICAN ELECTRIC RAILWAY ASSOCIATION

Statement of Aera Expenses
For the Year Ended October 31, 1922

Particulars
Salaries of Staff.

$11,627 09

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CHARLES L. HENRY :- Mr. President, I move that the report of the Treasurer be adopted.

(Motion seconded and carried.)

PRESIDENT TODD :- Our next business is the Report of the Finance Committee, Mr. J. H. Pardee, President, J. G. White Management Corporation, of New York City, Chairman. In the absence of Mr. Pardee the report will be presented by Mr. J. G. Barry, a member of the Finance Committee.

(Mr. Barry presented the report.)

REPORT OF THE COMMITTEE ON FINANCE To the American Electric Railway Association:

GENTLEMEN: In accordance with the new provision of the Constitution adopted at the last Convention, your Committee on Finance was created and has functioned during the past year.

We investigated and approved regular and routine salaries and expenditures and passed on all other expenditures before commitments were made.

All vouchers were approved by the signature of one member of the Committee, before being sent to the Treasurer for payment.

The policy of rigid economy was adopted, the personnel was kept down to the lowest possible number and no salaries were increased without urgent cause. Up to this time, in the opinion of the Committee, the production work of the organization has not suffered but the volume has materially increased and the expenses for personal effort and additional facilities must necessarily increase in the future. The excellent financial results of this year have been made possible almost entirely by the active, intelligent and loyal co-operation of the Executive Secretary and his entire staff.

The Committee has reported from time to time to the Executive Committee on the advisability of financial commitments under consideration.

The Committee has considered the question of dues sufficiently to arrive at the opinion that the present system should be continued.

Chartered Accountants were engaged, who have examined and reported on the books of the Company as required by the Constitution and By-Laws and their reports are available to you.

The cost of operation for the year has been kept well within the income, but it is the opinion of your Committee that the resulting surplus is not any more than is necessary for the adequate operation of the Association, and in fact this surplus should be gradually built up to a reasonable amount which would be available in an emergency to save the loss of time and resultant disadvantages in case funds were needed on short notice.

Respectfully submitted,

R. P. STEVENS,
J. G. BARRY,
J. H. PARDEE, Chairman.

Committee on Finance.

PRESIDENT TODD:— The next order of business is the appointment of the Committee on Resolutions. I will appoint, as a Committee on Resolutions, the following-named gentlemen :

COMMITTEE ON RESOLUTIONS: Thomas N. McCarter; P. N. Jones, Jr.; W. R. Alberger; H. W. Blake; P. S. Arkwright.

PRESIDENT TODD :- In the rehabilitation of our electric railway industry, we turn instinctively to our bankers. In order to obtain the confidence of financial institutions we are endeavcring to impress upon commissions and rate-making bodies throughout the country that such rates of fare must be allowed as will render a fair return on a proper valuation.

The future of electric railways is inseparably joined to the interests of bankers. We cannot function without the “ sinews of war.” We are very fortunate in having with us this morning an outstanding figure in the financial world; a gentleman who fills the high office of Vice-President of the Union Trust Company of Chicago, and a past president of the Chamber of Commerce, who will address us on the subject “ The Business Situation.” I have the great honor and pleasure of introducing to you Mr. H. A. Wheeler, Vice-President of the Union Trust Company of Chicago, Illinois.

THE BUSINESS SITUATION

By H. A. WHEELER, Vice-President,

UNION Trust COMPANY, CHICAGO, ILLINOIS Mr. President and Gentlemen: Whenever the author of a program does not know the speaker, and is very much in doubt as to what he might be able to talk about, he is apt to choose the subject, “ The Business Situation,” a subject that is so innocuous that it may be referred to and then dropped for something else, or that permits indulgence in a very large amount of prophecy, most of which has no foundation and very little of which will ever be realized.

If you are as tired of hearing about the business situation as I am talking about it, you would thank me to cut short my remarks and then perhaps to give consideration to that very interesting subject which I see on your program, namely, “Public Relations,” which seems to me to be the most vital subject in the whole field of public utility operation.

I think you will pardon me, Mr. President, if because of what I have said, I pay rather scant attention to the subject that has been assigned to me. You cannot pick up a daily paper, nor a periodical, in which you do not find pages devoted to the discussion of the situation in which business finds itself. I wish we might talk less about it and pay a little less heed to the often lurid and generally pessimistic utterances, and taking as our slogan " things are getting better every day” buckle down to our job of making the slogan come true.

Business is coming around all right. You cannot go through chaos as the world had to do in the five years of the war without affecting the temperament of every man, woman, and child in the world at some point or in some fashion and have the mental attitude of the people changed, as the common, ordinary thinking of the pre-war days has changed. Transplanting this is a flood of new ideas - new ambitions, new hopes, sown often by the radical agitator, sometimes by the parlor reformer, but always holding out a new era dawning in which all of the distresses and disadvantages of pre-war life will be overcome and equality not of opportunity but of possession “ will cover the earth as the waters cover the sea.” We know that these fantastic theories and experiments will fail, but a hundred million people within our borders don't know it; they are reaching out for something to make life easier, and we must give them time and help them to disprove the glittering shadow that seems substance. Only then will we settle down to a stable method of living and thinking. Only then will real stability and real normalcy be achieved.

There can be no doubt that we have many unfavorable influences of war still to overcome, but it seems to me that we need not fear very much for the result. Business is showing a steady, definite trend back to a more stable condition. We have negotiated with comparative safety the fall of abnormally high prices to prices in many cases as abnormally low. The price curve has been unusually abrupt, and if we consider past experience we must conclude that we have not yet reached a stable level, but we must reach it through, perhaps, two additional periods with additions to values and prices, one of which is now on, and reductions from these, until some time, probably in 1924, we will have worked our way back to a reasonably normal level of prices and to a basis of acting and thinking about as we did in the pre-war days, not on the price levels of the pre-war time, but with the restoration of the sane and efficient methods to which we were then accustomed in those days.

You, in common with all other industries, have passed through a day of very high costs and low returns. The cost of your money will be obviously less, involving a large amount of refinancing, and with this correction will also come some relief from the arbitrary and often unjust fixing of your income regardless of costs. With these conditions available, real prosperity will be achieved. Our country is richer than we ever thought it would be. There is more money for investment available now than we have ever known before in the United States, not only for investment in our own facilities and services, but there is money available for investment abroad as well.

We have, probably, as a result of the war acquired that position which, prior to the war, was singular to Western Europe. It was estimated then that Western Europe had an annual income for reinvestment in public services, wealth producing developments, etc., of some two and a half billions more than was absorbed in capital extensions of the West European countries, and this great investment power has come to be lodged in the United States, providing a large surplus of capital which we may fairly use for the development of our resources at home and also share with those who need it for profit-making operations in the countries of the world.

There is nothing unfavorable in the business situation. There is everything favorable. Buying has begun to flow again in more stable and natural channels than have existed since we began to move from our period of high inflation.

There is no question, gentlemen, but that your own craft, if I may call it so, has bridged a period of great distress, and has come into easier operation, but this easier condition gives us no warrant to assume that there will be no further interference politically and no further obstructions by the fickle and misguided public opinion as affecting the operation of your business. All the world seems to be intent upon the task of creating New Democracy, and the new Democracy is socialistic and worse in its character in proportion to the illiteracy of the country that tries to adopt it. In our country we are confronted with some very bad products of the war. One of these is the tendency of the so-called “ men of the street," once willing to be guided by the political wisdom and economic experience of people to whom they looked for advice and judgment, now assuming to be dictators in both political and economic fields, exercising the right to exhibit their own wisdom or ignorance and to press home the ignorance often more insistently than the wisdom.

War experiences and war service developed an abnormal number of public servants, many of them sacrificing their place in private life and their income to render aid to the Country in its time of need. After they got a taste of public authority, an authority that, during the period of the war was so absolute as to be practically despotic rule, the experience was not unpleasant; and the memory of the power exercised distorted in some of them their sense of individual values. There still exists in Government circles a strong tendency to retain the controls developed during the war, and instead of being content with the power of regulation as permitted under our Constitution, regulation soon leads to a desire to control, and in this dual effort many of the reasonable and beneficial regulatory measures are being extended to a form of Government control and operation that must be checked or we will be precipitated into a public interference with private enterprise wholly out of keeping with our former American ideals.

Now, may I stop here and turn my remarks in the direction of your subsequent discussion in regard to public relations, because, as I have looked over your program, I think that subject is of paramount interest today,– I think and hope that in our consideration of this subject together we will be able to find some new light that will lead

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