The experience, which we have hitherto had with concerns taken over by the State or by municipalities is not of a kind to encourage the continuation of such attempts, says "Engineering," quoting an address delivered to German workes. On the contrary they prove how little these concerns are able to stand competition with private undertakings. In fact, up to now the State when acquiring private concerns has genera lly not permitted itself to be guided by fiscal considerations, but only by the wish to obtain the full and unlimited power over certain "con-corns—like railways—which appear to be indispensable for military or economic ends.
In the case of the coal mines, which the Prussian State possesses in Upper Silesia, Westphalia and in the Saar Valley, the result State management has been that the profit has hardly amounted to 1 per cent. of the capital employed, whilst private companies pay dividends of 10 per cent. and more. This is only a fresh confirmation of previous experience that State administration is more expensive than private administration, and may, as is proved by results of State coal-mining, be very _considerably more expensive. Under these circumstances one must wond-why the State did not let its mines on lease and obtain thereby a fixed percentage from the capital employed, This would certainly have been more profitable to the firm State and more acceptable to thir! strike, the hope of a profit from taxpayer.
Bertin Execrric Works.
Let us take another case, which tis nearer to us. The Berlin Electricity Works distributed in the Years 1910-14 to their shareholders annually 6,192,000 marks. They paid to the town as their share of the profits between 3,500,000 marks and 4,000,000 marks—and further, they paid in taxes on gross receipts 2,798,704 marks. 3,035,354 marks, 3,263,691 marks, and 3,400.01 marks respectively.
We thus see that the town of Berlin obtained from the Berlin Electricity. Works up to the outbreak of the war. in rates and are of profits, an amount which increased from year to year, and had risen in the year ending on June 30. 1914, to over 7,000,000 marks, and which exceeded by more than 1,000,000 marks the dividends paid for that year to the shareholders.
One would suppose that the town had no reason to wish for a change from this state of affairs which gave it, without risk or trouble, a revenue which must be considered important, even for the budget of a town like Berlin, especially if one considers that the 10 per cent. tax on the gross receipts of the Berlin Electricity Works was an income to the town in any cast, and that in this respect the city ran no risk whatever. In spite of this-the town refused the liberal offers which the Berlin Electricity Works made them in order to in-Guce them to abandon their right of purchase. because they hoped that by the town taking over the works the profit would on the one hand be increased, and that on the other hand they would at the same time be able to lower the price of electric current to consumers. This hopi, however, has not been fulfilled. The year, April 1, 1916, to March 31, 1917, brought a profit of only 4,681,835 marks, and the report concludes with the sad remark that it was doubtful whether for the year 1917-18 any profit at all could be obtained. The report 1917-18 is not yet available, but probably the author of the report has proved a true prophet and after the enormous increase of wages which have been forced through during the _last these works has still further do-creased.
Iitvsioxs or Soctatisa.
This socialization has, therefore, up to the present not been a pleasant experience for the inhabitants of Berlin, for it has not only led 1 a considerable increase in the town budget, but it has also led to an imerease in the budget of every individual by the repeated raising of the tariffs for light and power. Even taking account of the fact that the situation during the war has been less favourable, the town could under the former arvang:- ment not have sustained any loss. and they would at any rate, have obtained the 10 per cent. tax on the gross receipts. The company. too would "have worked less favourably, but the community would not have been. called upon to make good these losses in the form of higher taxation.
The above-mentioned strike in the City of Berlin's Electric Works proves, by the way, as one of the Berlin newspapers justly remarked, that the workmen are not by any means restrained from doing the most serious damage even to public undertakings, and that 1s a grave illusion to suppose that the socialization of great indus trial concerns would guarantee favourable developments on the hypothesis that the class egotism of the working men would call a halt before it would hamper Socialized undertakings.
Text read from the printed page and cleaned; old type leaves the occasional error.