still advances, yet if through an agreement among the producing mines this sales-rate should be dropped twenty-five per cent., it would so increase consumption as to force back the price to a point that would again discourage consumption; and yet in the old mines the cost of producing the metal sold at fifteen and a half is but six to seven and a half cents, in some even lower.
Compare these conditions with those existing in the steel industry. Therein unlawful combinations and unnatural restrictions are essential if those engaged would show a gross profit of even fifteen per cent. on their gross output. If more than fair or going returns are earned, then new capital flows into competition and the surplus again shrinks to an uninviting point. The same is true in wheat, corn, and cotton—big prices invite fresh investments and the planting of broader acreage. Hence the sorry spectacle of the cotton planter who, in 1905, will receive no more for his twenty per cent. increased crop, coming from over two millions increased acreage planted last year, than for his smaller one of the year before.
That my readers may quickly, and once for all, grasp the point I wish to make, I will illustrate:
The Steel trust in 1904 did a gross business of $432,000,000, upon which they made a profit of $71,400,000, and yet this vast amount was only five per cent. upon the trust's inflated capital of $1,400,000,000 odd; and as the "System," in regulating the capitalization, arranged that the preferred stock (and bonds), which represented the "System's" profit, should receive seven per cent., there was not a dollar in dividends for the $520,000,000 of common stock which had been sold to the people for, in round figures, $300,000,000.
At the same time the Calumet & Hecla Copper Company produced and sold over $10,000,000 worth of copper, upon which it earned, net, over