PRE-WAR PRINCIPLES AND METHODS 39 
of Locomotive Engineers and Firemen and other em- 
ployees, has been afforded by an analysis of the dividend 
disbursements of only fourteen companies during the 
past fiscal year—a subnormal period of industrial depres- 
sion. These companies alone were found to have paid 
dividends in 1914 on fictitious stock issues amounting to 
$43,167,599. This does not account by any means for 
all of the excess stock of Western Railroads which are 
engaged in these proceedings, but only for a number of 
representative and illustrative cases. A comprehensive 
estimate would also have to take fictitious bond issues 
into consideration. If the future outlook were also 
considered; hundreds of millions of dollars of fictitious 
capitalization would be discovered which has not as yet 
received remuneration but which may become a drain 
1pon operating revenues. 
[t will be noted that the claim was made that the net 
gains secured from the increased productive efficiency of 
railway engine and train crews, as well as from the invest- 
ment of new capital, from managerial efficiency, and from 
government land grants, had been improperly absorbed or 
dissipated by railroad financial management, and, as a 
consequence, neither employees, travelers nor shippers had 
received a fair participation in these productive gains. The 
overturning of the existing financial structure and man- 
agement of the railroads was not advocated, but the 
demand was made for the granting of a just share to em- 
ployees in revenue gains arising from their increases in 
productive efficiency before further corporate distribution 
of funds was permitted. 
The representatives of the railroads replied to this argu- 
ment by the counter-claim that decreases in costs of opera- 
tion had been made possible by increases in capital invest- 
ment, and improved facilities had lessened rather than 
increased the physical labors of employees. From this it