by covering rises in raw material
far in excess of the actual increases. Many have been wrung from the
poor and the needy, who are now being enjoined by the Government to eat
less meat. Messrs. Spillers & Baker, of South Wales, increased their
profits from an average of L140,000 (three years' pre-war average) to
L367,000 in 1914-15. We do not blame them. The rise in price was beyond
their control. They could hardly help benefiting. But it is mere madness
for the Government to leave them in possession of these vast accretions
of wealth. Firms that paid 8 per cent before the war, now paying 22-1/2
per cent (such as Messrs. Richard Dickeson & Co., the Army contractors)
are able to pocket tens of thousands that ought to go to strengthen the
resources of the nation. Others, like the Mercantile Steamship Co.,
increase their dividend from 20 per cent to 35 per cent; and some are
able to pay dividends actually larger than the capital of the company
itself!

It is ludicrous for the Government to allow this condition of affairs to
continue. Their course is quite clear. They should limit profits to the
average of three years before the war, and add at the most 5 per cent.
Anything short of this is a betrayal of the national interests to
private firms.

7. _The New Statesman_, March 25, 1916:

An innocent person might think that when a manufacturing company is
faced with an enormous rise in the cost of the principal commodity it
consumes, its profits would be diminished. Some law must be in operation
which has escaped the attention of economists, for so far from this
being the case, what appears to happen is that the profits of
manufacturers rise in a greater degree than the price of the raw
material. Thus, so far from being hit by the enormous rise in the price
of flour, Peek, Frean & Co., the well-known biscuit manufacturers, made
a net profit of L107,478 last year, as compared with L99,578 in 1914,
and L98,607 in 1913. After paying the usual 5 per cent on the L300,000
of preference shares no less than 25 per cent is paid on the L230,000 of
ordinary share capital, which has been issued. This company raised its
money very cheaply from the public, which paid 102 per cent for its 4
per cent debenture stock and par for the 5 per cent preference shares.
The investing public does not benefit by the big dividend on the
ordinary shares. These were never offered to the public, but are
privately held.

Another shipping company, sist