Lower Dividends

Thousands of U.S. investors pulled their belts a little tighter last week when no fewer than seven big-time corporations slashed common-stock dividends. Samples:

P: Giant Westinghouse Electric & Manufacturing cut quarterly payments from $1 to 75-c- a share, explained to 48,000 shareholders: "High Federal taxes."

P: Sterling Products (Bayer Aspirin, Fletcher's Castoria, etc.) cut its payment from 95^ to 75^, partly to "conserve cash resources."

P: Booming Wheeling Steel declared only 25-c- a share v. 50-c- in April.

P: Other dividend cutters were Sperry Corp., farm-machinery maker Deere & Co., American Rolling Mill, undie-maker Munsingwear.

Although aggravated by wartime taxes and operating costs, the current wave of dividend reductions is actually part of a decade-old U.S. economic trend. The August issue of FORTUNE points out that between 1929 and 1942 U.S. national income rose 35% to an estimated $113 billion, wages & salaries jumped 46% to $76 billion, net agricultural income soared 48% to $8 billion. But at the same time, interest, rents and royalties dropped 11% to $8 billion, dividend payments flopped 25% to $4 billion.

No clearheaded U.S. economist expects any sudden reversal of this dividend trend.

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