The American Railway Industry
767
which affect its demand or supply, and which, through these factors, in fiuence the profits of its producers. The production of anthracite coal is reduced by a strike. As a result, the demand for bituminous coal is increased. A failure of the corn crop reduces the profits of the farmer and rancher. A cut in duties decreases the profits of the manufacturer, and a change in internal revenue duties affects the profits of the grower and distiller. Prices and profits are in a state of constant change. No manufacturing industry can be certain of its earnings a year hence. From these disturbing influences, however, the railway company is, to
a large extent, protected. The great variety of its traffic prevents rapid changes in the gross amount. What is lost on one commodity is often regained on another, and the total tonnage is not reduced. This is well illustrated by a comparison of the gross earnings of the Pennsylvania Railroad with those of the United States Steel Corporation. The one is the largest railroad system in the United States and one of the best managed, and the other is the largest and one of the best managed and best organized industrials.
The steel corporation, moreover, manufac
tures a great variety of products, so that its demand would naturally be more stable than those of steel manufacturing companies whose profits are more narrowly specialized. It has also been able to maintain for long periods stable prices for most of its products, and its supremacy in the steel trade since its organization has only recently been challenged. Com petition, until the winter of 1909, has very slightly disturbed it, and yet the fluctuation of its gross earnings, compared with the Pennsylvania
Railroad, which appears in the following table, where the figures are stated in millions of dollars, is extreme. The figures for the Pennsyl vania Railroad are as follows, stated in millions of dollars: 1902 1903 I904 1005 1906 1907 I908
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ll2 122 118 133 148 164 136
and for the United States Steel Corporation as follows: 1902 I903 1904 1905 I906 1907
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500 536 444 585 696 757
1908 . . . . . . . . . . . . . . . . . . . . . . . .. 482
