Thursday, February 7, 2008

Profit Sharing Circa 1868

Leter to Railroad Executive Charles Francis Adams, Jr.* written in New York, February 8, 1868, almost 140 years ago to the day:

"I am very much obliged for your note and for the pamphlet on "Railroad Legislation" by which it was accompanied...

"The plan of paying railroad employees in funds out of profits has been tried on the Orleans railroad in France. I am not quite sure about the particular line, but certainly it is one of the French ones, and I am informed with great success. I think cooperation, or some modification of it, will yet be resorted to in all employments and occupations, in which zeal is of high importance, and cannot be secured by constant inspection. On railroads, the effect of dependence of the servants for part of their wages, on net receipts, would undoubtedly diminish waste, promote vigilance and politeness to passangers. I think the employer's art--the art that is of getting the most out of men, of bringing their faculties most effectively into play in industry, is still in the rudest condition in all civilized countries. Fixed wages is one degree better than slavery, which only appeals to one motive of action, and that a low one."

--Edwin Lawrence Godkin, founder and editor of the Nation and editor of the New York Evening Post
William K. Armstrong, editor, The Gilded Age Letters of E.L. Godkin,, pp. 119-20
Albany, NY 1974: SUNY Press

Question: How much has management improved since 1868?

*"Adams was...the great-grandson of both United States President John Adams and United States Secretary of the Navy Benjamin Williams Crowninshield, and the grandson of president John Quincy Adams...After graduating from Harvard University in 1856, Adams served on the Union side in the American Civil War...He received the brevet rank of brigadier-general in the Regular Army in 1865...Adams was president of the Union Pacific Railroad from 1884 to 1890, having previously become widely known as an authority on the management of railways. Among his writings are Railroads, Their Origin and Problems (1878)."

No comments: