BRITISH RAILWAYS Digitized by the Internet Archive in 2007 with funding from IVIicrosoft Corporation http://www.archive.org/details/britishrailwaysfOOIawsrich BRITISH RAILWAYS A FINANCIAL AND COMMERCIAL WRVET BY W. R. LAWSON ^ ■ CHAIRMAN OF THE RAILWAY SHAREHOLDERS' ASSOCIATION AUTHOR OF 'aMI-.RICAN industrial PkOBLEMS," "BRITISH ECONOMICS," " MODERN WARS AND WAR TAXES," "CANADA AND THE EMPIRE," " JOHN BULL AND HIS SCHOOLS," ETC. NEW YORK D. VAN NOSTRAND CO. TWENTY-FIVE PARK PLACE 1914 we^" \^ V ^ INTRODUCTION The day of the steam traction railway is nearly over. Already electric traction has superseded steam in many branches of transportation, and the transition may be completed within the lifetime of the present generation. This may therefore be a suitable occasion for reviewing the work of the steam railway. No better field for such a review could be desired than the country which was the pioneer of railway builders. The British railway system is not only the oldest of all, but it is in many ways the most interesting. Though it has been by no means the most enterprising, it has had the greatest influence on the development of railways throughout the world. Although now a small system com- pared with that of the United States, there is more to be learned from it not only by the railway engineer, but by the traffic manager, the trader and the law-maker. Its very faults and shortcomings are instructive. A retrospect of British railways carries us back very nearly a whole century. It calls up before us a long pro- cession of famous railway builders, administrators and financial organisers. Stephenson, Brunei, Brassey, Peto, the railway kings of their day, pass before us in imagina- tion as we try to estimate the permanent value of the gigantic task which they accomplished. In the long roll of railway chairmen and managers many brilliant though half -forgotten names stand out pre-eminently. Moon, Finlay, Grierso n, Watkin, Gooch, have all left their mark on the British railway of to-day. Not the least dis- tinguished of them was the late Lord Salisbury, who in the railway crisis of 1866 was called in as a deus ex machina to rescue one of the most hopeless of the many railways then in bankruptcy. 341.1 vi INTRODUCTION If we could imagine one of our railway pioneers alive to-day, and familiar with the whole century of evolution and development that lies behind us, what, we wonder, would be his verdict upon it ? How many mistakes might he point out to us in the original planning of our railways, especially the trunk lines ? How many obstacles and hindrances to their progress might he disclose to us ? How many instances might he give us of foolish and wasteful expenditure ? — how many of extortion and black- mailing ? — how many of bad policy and false enterprise ? — ^how many of ruinous competition and destructive hostility ? The railway managers of the nineteenth century were continually raising new problems which became more and more difficult as the traffic increased in complexity. As a rule they were much easier to raise than to settle. Very few of them were ever met in a broad, comprehensive spirit and finally disposed of. They were temporised with and bandied about from one Select Committee to another, or from one Royal Commission to another. So they passed on from generation to generation, and some of them are as much alive to-day as they were seventy years ago. Our parliamentary debates on railway questions are crowded with the ghosts of last-century problems still unsolved. The railwaymen of to-day have these problems to wrestle with as well as their own. In other respects railway debates in the House of Commons are rather melancholy reading. They reveal much that is not either flattering or encouraging to railway shareholders. No subject that our law-makers have to deal with excites so much prejudice or provokes such a variety of hostile criticism. Tariff Reform and Home Rule are non -controversial subjects compared with the most innocent kind of a railway Bill. The acrimonious discussions which took place over the one-clause Bill for redeemmg the pledge which the Government gave to the railway companies in August 1911 are still fresh in the pubhc memory. Glancing through them we find in almost every speech, except those of the railway directors themselves, indications of anti-railway sentiment. Re- INTRODUCTION vii proaches, condemnation and censure follow each other so monotonously that at last we wonder how any one institution could have drawn down on itself such a variety of ill-will. After all the railways are not so very much worse than their neighbours. Their misfortune is that they come in contact with the public at so many different points, and they tread unavoidably on so many people's toes, that popularity is as impossible for them as for mosquitoes or rate collectors. The utmost they can expect from the public is some approach to fair play, and even that they have not been able to count upon of late. A little less sweeping censure and a little more consideration might be wiser as well as more merciful. It might, for instance, be remembered that railway managers are responsible for the largest and most important public service in the country; that they have to conduct it under the most difficult conditions and restrictions ; that they are never free as other directors and managers are to act on their own judgment, and that, notwithstanding all sorts of official interference and control, they are held answerable for the lives, limbs and property of the millions of railway users. Our railway companies have never been their own masters, and are becoming less so every year. Recent events have made clear and unmistakable the dilemma to which they are being reduced. On the one hand, they cannot satisfy the traders without materially reducing freight rates, which involves wholesale reduction of working expenses, wages included. On the other hand, they cannot satisfy their servants without frequent advances in wages as per the trade union programme. To this has lately been added a second dilemma. They have to conduct an enormous volume of railway traffic and be responsible for everji^hing that happens to it, while at every turn they are subject to the dictation of their employees. We are living in an age of railway crises and con- troversies. Railway managers seem to spend the greater part of their lives in hot water, either parliamentary, disciphnary or financial. The halcyon days when modest viii INTRODUCTION dividends could be earned quietly, when there were few complaints either in the goods or passenger department, and when railway labour was the most contented of any — these days have gone for ever. In their place we have got the survival of the fittest. The shareholder, the worker, the trader, the nationaliser and the confiscator are all in bad humour. Each of them has his own idea of how a railway should be managed, and the one point they agree upon is condemnation of the present methods. Doubtless these have their faults, and may be capable of improvement in many directions. But how much progress can be expected where the team are all pulling in different directions ? What chance would the most skilful general have of victory if his troops were all fighting for their own hand, and quarrelling over his orders instead of obeying them ? That is the condition to which our railway service may, unknown to ourselves, be rapidly drifting. It may have more to fear from internal disorganisation than from national strikes or any other bogey with which socialists and sjmdicalists can threaten it. The vital question of the day for British and possibly also for American railways is how long they can be ex- pected to do their work properly under existing con- ditions ? Sooner or later the discontent of their servants, the grumbling of their customers, the persistent obstruc- tion of the Legislature, and State interference in a multi- tude of forms must impair their efl&ciency. If unchecked these evils can have only one end — chaos and heavy loss. In a recent debate in the House of Commons ^ it was said by one speaker that the traders were going to demand an inquiry into the whole question of railway management. It really looks as if it would have to come to that, and the sooner perhaps the better. Mr. Bonar Law gave a certain amount of countenance to the suggestion by hoping that *' if the Government carry out their promise to have a real inquiry into this matter, and if as a result there was to be any preference, it should be given to home produce and not to produce from abroad." 1 Railways (No. 2) Bill, March 6, 1913. INTRODUCTION ix After the leader of the Opposition had put in a passing word for home industry, Mr. Wardle, one of the chief spokesmen of the railwaymen (also editor of their official organ, the Railway Review), stated with engaging candour their line of opposition. He and his friends, he said, could not vote against a Bill which had for its object the raising of wages, but they were in favour of limiting it to five years. Such a limitation would have given them " the opportunity of reviewing the state of affairs from time to time, and bringing the railway companies up to the standard." Had Mr. Asquith's ingenious idea of afterwards including the measure in the Expiring Laws Continuance Bill been adopted, Mr. Wardle 's " oppor- tunity " would have come round annually. Can that fact have been in the mind of the Prime Minister ? The most virulent attack of railway-phobia was ex- hibited not by a Labour leader or a Socialist agitator, but by a Unionist member, Mr. Bat hurst. He has taken up the cause of the farmers and small traders so hotly that anything not in their interest is anathema to him. On that ground alone he repudiated the pledge which the Government had given to the railway companies in return for valuable considerations long since fulfilled. With a bold stretch of sophistry he declared that " the most it amounted to was that certain proposals should be made to Parliament, and proposals had been made to Parliament, but Parliament, or the more democratic part of it, had not seen fit to accept them in the form in which they were submitted." Mr. Rowlands, another Unionist member, was not quite so outspoken a repudiationist as Mr. Bathurst, but he warned the railway companies that five years hence they would find they had made a great mistake in rejecting the time limit. Mr. Wedgwood maintained his reputation as a railway phobist. So warmly did he approve of including the measure in the Expiring Laws Continuance Bill, that he might almost be suspected of having known something about it beforehand. It is just the sort of inspiration that might have happened to him and his friend Sir Alfred Mond. The prospect of an annual X INTRODUCTION baiting for the railway companies would delight them both. But according to Mr. Wedgwood there are to be no more bribes or legislative sops for " the masters' side." In future a much shorter course is to be taken with them — if Mr. Wedgwood is consulted. The Government are to use their powers not to coerce the workers, but to coerce the railway directors and managers. Even after such a stream of unique criticisms Mr. Keir Hardie found something original to suggest. He opposed the Bill on the frankly Socialist ground that " if it became law it would add considerably to the value of railways." By doing so it would prove an obstacle to their ultimate nationalisation, which of course Mr. Keir Hardie thinks is bound to come. Meanwhile he will do nothing which, when the time came, might cause the country to have to pay millions more for the railways than it would otherwise have done. Two Unionist members followed Mr. Keir Hardie and gave a crowning proof of the mental confusion which reigned in the House on railway policy by taking opposite lines — one siding strongly with Mr. Keir Hardie, and the other going as strongly against him. Mr. Peto thought that as the whole question of the relations of the railway companies to the trading community was about to go into the melting-pot, temporary expedients like Con- ciliation Boards and bargains about raising rates were waste of time. Party sentiments appropriate to the occasion were next expressed by a succession of Radical members. Mr. Lough thought that the price paid for the settlement of the strike was too high. Mr. G. Roberts contended that the pledge given by the Government was fulfilled when Ministers submitted their proposals to the House — a curious echo from the Labour benches of the Jesuitical logic of that orthodox Unionist Mr. Bathurst. Mr. Jowett felt it was a very bad thing that they could not increase wages without advancing prices — a doctrine which holds true of many other industries than railways. He was horrified at the thought of the Government " by statute declaring that for all time the railways INTRODUCTION xi should be indemnified against the risk of increasing wages." Mr. Walsh, a Lancashire Labour member, delivered the most sweeping indictment against the Bill. He charged the railway companies with having obtained the promise of it by false pretences. They had pleaded in forma pauperis when in fact they had been saving money and increasing profits. The Government also had been inconsistent. In passing the Minimum Wage Act they had insisted on putting in a three-year limit, but in dealing with the railway companies they said it was unfair to insert a limit. Like all the preceding speakers on the Labour benches, Mr. Walsh declared for the periodical review of railway affairs in Parliament. This is evidently a new development of the Labour programme, and as such it merits the early attention of the railway companies. The last private member to join in the discussion was Mr. Rutherford, a Liverpool man and a Unionist. He was willing to support the Government against his own views as a trader if they would promise to deal next session with the two principal grievances of the traders, namely, owners' risk rates and the withdrawal of facilities. This may be accepted as an authoritative statement of the Lancashire position in the railway controversy. It is confirmed by reports of the discussions that have taken place in Lancashire Chambers of Commerce on the subject. The Oldham and the Ossett chambers in particular have been protesting strenuously against railway delays and demurrage grievances. Incidentally they objected to the No. 2 Bill. These brief reflections from the mirror of Parliament will be more illuminating as to the attitude of public opinion toward the railways than any amount of general description. The speakers in the debate referred to were all representative in a way, and every speech indicated some particular interest or sentiment. One might gather from them a catalogue of the prevailing objections and prejudices which the railways are having to contend with. In the course of the debate it was alleged — xii INTRODUCTION That an early inquiry into railway rates might be held (Mr. Bonar Law) That the railway companies had not scrupulously fulfilled their pledges to the men (Mr. Wardle). That the farmers and small traders were being sacrificed to the railway companies (Mr. Bathurst). That all parliamentary arrangements with the railway companies should be subject to periodical review. In practice this might be applied to all railway legislation whatever (supported by nearly all the Radical and Labour speakers). That there should be a Royal Commission on railway management (Mr. Rowlands). That in national strikes the Government should take charge of the railways (Mr. Wedgwood). That in view of nationalisation, everything likely to add to the value of the railways should be opposed (Mr. Keir Hardie). That there must soon be a complete overhaul of the relations between the railway companies and the trading community (Mr. Peto). That in the bargain of August 1911 the price paid by the Government was too high (Mr. Lough). That the grievances of the agricultural and trading communities would be intensified by the proposed increase of rates (Mr. G. Roberts). That it was a new constitutional principle for the railway companies to be indemnified for all time against the risk of increasing wages (Mr. Jowett). That the railway companies were obtaining the right to increase wages on false pretences, as they were saving money and increasing their profits (Mr. S. Walsh). In one debate, and not a very long one at that, a dozen different criticisms all more or less unfavourable were passed on the railway companies. Hardly a single word was said in their defence even on the Unionist benches. Could there be a more conclusive proof that somehow or another they have lost favour with the House of Commons, and must henceforth regard it as a hostile tribunal ? If this attitude of the House of Commons correctly expresses INTRODUCTION xiii the sentiments of the community, the railway companies have need to bestir themselves. Either the public are under a serious delusion as to the character and conduct of our railway administrators, or there is urgent need for drastic reforms. Among so many grounds of dissatis- faction as have been of late expressed there is likely to be a good deal of misapprehension, also not a little exaggeration, but even if only a small residue of truth remains in them, they will deserve thorough investigation. So much for the political aspect of our railway system, which is only one of many. In addition there are financial, technical, commercial and administrative questions to examine. Exaggerated ideas prevail as to the capitalisa- tion of our railways, their fixed charges, their freight rates and their working expenses. The one point on which they are not envied is their dividends. No one can say that these are either inflated or unearned. The condition of home railway securities is about as puzzHng as that of the railways themselves. It is by no means altogether unsatisfactory, but the good and the bad points — the wheat and the tares — are mixed up in a very exceptional way. Nothing short of severely scientific inquiry can strike a balance between them. Inside the main problem of British railway policy there are one or two minor ones like wheels within wheels. The chief problem is national, but branching from it are a number of local ones. At the head of this supplementary list the chronic problem of London traffic still holds its place. It was here that our railway pioneers had their finest opportunity and that they have achieved their worst failures. Whether we regard London as the world's premier port or as its most populous city, it has from a railway point of view been exceedingly unfortunate. Both its street and its river traffic have become a bjrword for congestion and overcrowding. The most far-sighted of our early railway builders had no conception of the future possibilities of our commercial ports generally. They erred grievously with regard to London. When they had connected it in a round-about way with the provinces they imagined that that was all xiv INTRODUCTION they had to do. They overlooked the Thames, which threw open to them the trade of the world at large. And to this day not one of them has river or dock ter- minals worthy of a fifth-rate port, to say nothing of a commercial metropolis. Only one of half-a-dozen trunk lines entering London from the North has direct connec- tion with the principal docks. The others are content with running powers over that one, and even these are used sparingly. Careful managers prefer to cart all they possibly can across London. Fortunately for British trade the huge blunder com- mitted on the Thames has not been frequently repeated at the out-ports. They have been rather inclined to the opposite extreme, and during the past quarter of a century there has been somewhat of a craze among our trunk railways for having water terminals of their own. Special harbours have been created at various points on the coast where the need for them was certainly not too obvious. Several of them have been formed to serve cross-channel routes and short sea routes to the Continent. These routes are all violently competitive ; so much so that few of them pay, and all the excuse the railway directors can make for them is that they are necessary feeders to the main lines. Thus we find two extremes exhibited by British railways in the interchange of land and water traffic. Either the facilities provided are excessive, as at certain of the Channel ports, or they are glaringly defective, as in the Thames. But that is only one of the railway problems as to which London has been singularly unfortunate. Its urban Hnes of communication, both for goods and passengers, appear to have been deliberately planned so as to produce a maximum of crossing and re -crossing. Any metropohtan map you pick up shows at a glance how the whole network of tubes, subways, street railways and overhead lines has been muddled up. A very ironical but appropriate sequel to this accumulative chaos is that until lately the whole of the urban traffic of London — rail, train and omnibus — was being carried on at a loss. The latest competitor in this crowded field of enterprise — ^the motor INTRODUCTION XV bus — is enjoying a run of luck which may be short or long, but that it is not to last for ever is one of the simplest lessons of past experience. The burning questions of the day in the railway world are the insatiable demands of organised labour and the enormous additions they are making year by year to working expenses. This would have been a most difficult problem even if the railway companies had enjoyed a free hand in dealing with it. The intervention first of the Government and then the House of Commons has so *' poisoned the atmosphere," as the saying is, that friendly agreement appears to have become impossible. The Saturday night compromise of August 1911 between Mr. Lloyd George and the Chairmen of the London and North-Westem and Midland Railways helped the Govern- ment out of a bad hole, but only to land the railway companies in another. The shadowy prospect held out to them of being allowed to pass on all future increases in wages to the traders has so far proved somewhat illusive. Practically all they have gained by it is that they have now two hornets' nests on their hands in place of one. The most conservative of railway shareholders can no longer shut his eyes to the tendency of all railway questions and controversies to merge themselves into one compre- hensive issue. Wherever they begin or whatever may be their local details, they eventually arrive at the supreme question of the railways and the State. It is useless and even foolish to blink that any longer. Feeling this as I do, I have deemed it my duty to frankly discuss in the last two chapters the knotty subject of railway nationalisation. CONTENTS BOOK FIRST— FINANCIAL CHAPTER I WHAT THEY HAVE COST Their capitalisation, nominal and actual — Their cost per mile com- pared with foreign railways — Difference between miles of line and miles of single track — ^Appreciations and depreciations in market values of stocks — -Line and single track mileage — Their capitalisa- tion analysed distinguishing nominal and cash capitals — ^Diversity of railway building to suit different kinds of traffic — The nine trunk railways : their respective capitals actual and nominal — Their averages per mile of hne and per mile of single track — Their comparative density of traffic — The southern railways : their average capitals per mile of line and per mile of single track — The nine mineral railways : their nominal and cash capitals per mile of line and per mile of single track — Five Scottish railways : their nominal and cash capitals per mile of line and per mile of single track — Six Irish railways : their nominal and cash capitals per mile of line and per mile of single track — Synopsis of the five representa- tive groups, giving a comparative view of their capitalisations per mile of hne and per mile of single track . . . .1-16 CHAPTER II WHY THEY HAVE COST SO MUCH The excessive cost of parliamentary powers, surveys, land, and other preparatory work — The pioneer railways penalised by nearly every- body they had to deal with — Opinion of Sir Rowland Hill on the shabby treatment they received — His advocacy of Government ownership of railways combined with joint stock operation — Views of Sir Edward Watkin and Mr. AUport as to dividing the country into railway districts — Early mistakes in planning terminal stations especially in London — The costly error of joint stations and joint urban lines — Overlapping train services and duphcated traffics — Inadequate ideas of the future possibilities of the new method of transportation — Competition in " public facihties '* more expensive and wasteful than competition in rates — Sir C. J. Owens of the London and South-Westem Railway on luxurious xvii xviii CONTENTS and unnecessary facilities — The railway companies led into extrava- gance by too easy borrowing — ^Modern expenditure on improve- ments, short cuts, reconstruction of road-beds and bridges — Luxuri- ous rolling stock and lightning expresses have cost more than rate wars would have done — The small and diminishing returns obtained from new expenditure on existing lines — The folly of the " universal providing " policy now pursued by our principal railway companies — Their locomotive and wagon building generally more expensive than purchasing from outside builders would be — The American practice of buying everything in the best and cheapest market — The Canadian Pacific Railway compared with a standard British line — Financial advantages of Canadian and American over British railways — " Scaling down " of American capital contrasted with British "share splitting" and other nominal increases. . 17-27 CHAPTER III THE WORK THEY DO Highest test of railway efficiency is the work done for the community — T he England of to-d eiy and the England of eighty years ago con- ^asied— The tranBformatioh it has undergone largely ifTiOt cHiefly due to railways — Goods and passenger movements of 1911 — The great industries of the Thames, the Tjnie, the Clyde, Yorkshire, Lancashire and the country generally are all dependent on railways for their existence — Passenger movements of England, Scotland and Ireland — Their respective relations to population — Their proportions of passenger receipts — Their average number of passengers per train mile — Their average earnings per passenger and per train mile — Their mineral and merchandise tonnage — Their mineral and merchandise receipts — Their train mileage of merchandise and minerals — Their average receipts from merchandise and minerals per mile of track and per train mile — The Trunk Line Group : general view of their mileage, passenger earnings and goods earnings — ^Average numbers of passengers per mile of track and per train mile — ^Average passenger receipts per mile of track and per train mile — Tonnage of merchan- dise and minerals — ^Average tonnage per train mile and per mile of track — The Mineral Group : average passengers per mile of track and per train mile — Merchandise and mineral tonnage — Average tonnage per train mile and per mile of track — The Scottish Group : average number of passengers per train mile and per mile of track — Tonnage of merchandise and minerals — ^Average tonnage per train mile and per mile of track — The Irish Group : average number of passengers per train mile and per mile of track — Ton- nage of merchandise and minerals — Average tonnage per train mile and per mile of track 28-39 CHAPTER IV THEIR GROSS AND NET REVENUES The return on capital expenditiu-e is the practical test of safe and reasonable capitalisation — Gross and net earnings of English rail- CONTENTS XIX ways — Their percentage on capital expenditures — Same for Scottish railways — Same for Irish railways — Gross and net earnings for the United Kingdom — Unexpected imiformity of net earnings per cent, in the three kingdoms — Great importance of capitalisation as a factor in railway results — British capital accoimts overloaded with outside expenditure — ^American railways stick closely to their proper business — Large proportion of British railway income is extraneous — The poor results of extraneous undertakings or "side shows" — The Railway Accoimts and Returns Act will greatly facilitate the investigation of railway earnings and working expenses — The Trunk Lines : they do three-fifths of the railway work of the United Kingdom — Their traffic receipts classified (merchandise, minerals and live stock) — Their traffic receipts proper and their trading receipts compared — Their traffic receipts, working expenses and net revenues — Their trading receipts, working ex- penses and net revenues — Their average traffic receipts, expenses and net revenues per mile of single track — The Mineral Group : Their railway receipts proper — ^Their trading receipts, expenses and net revenues — The Southern Group : their railway receipts proper — Their trading and railway receipts compared — The Scottish Group : their railway receipts proper — Their railway and trading receipts compared — Their trading receipts, expenses and net receipts. The Irish Group : their railway receipts proper — Their railway and trading receipts compared — Their trading receipts, expenses and net receipts 40-60 CHAPTER V RAILWAY ACCOUNTS AND STATISTICS The obsolete railway returns of 1868 — The agitation for fuller and more intelligible accounts — Ton miles and passenger miles — The Depart- mental Inquiry by the Board of Trade — The claims of the statistical experts presented by Mr. Acworth and Sir George Paish — Sir George Gibb's plea for ton miles — His criticism of train miles as a test of railway efficiency — The alleged expense and difficulty of working out ton mile statistics — Official scepticism as to their value in promoting fuller loading of trains — Sir George Paish's explanations of the ton mile formula — The author admits their scientific value and their usefulness in a roundabout way but holds that there are other reforms at once more practical and more urgent — Great things expected of the new accounts — Suggestion that the Board of Trade returns should also be improved and expanded— The example of the American railway statisticians recommended to British railway managers — The first requisite of railway accounting at the present day is more exact allocation of working expenses between passenger and goods mileage — ^American analysis and classification of working expenses carried much farther than in this country — The possibility of having a profit and loss account for all the principal main line trains — This would furnish a definite standard for railway operations, and a key to practical economies ......•••• 61-60 XX CONTENTS BOOK SECOND— HISTORICAL CHAPTER VI THE TRANSITION FROM ROAD TO RAIL /At the opening of the nineteenth century, when EngHsh roads had reached their Hmit of perfection they were superseded by the new system of transportation — ^The great road makers of the age, Telford and Macadam — The industrial development of the eighteenth century — Charles the Second an active promoter of good roads — The first Act authorising tolls was passed in his reign (1663) — Postlethwayte's dictionary published in 1746 — Its interesting description of English roads and road traffic at the middle of the eighteenth century — Cart- age rates between London and Birmingham — Between London and the western ports, Bristol, Exeter, Gloucester, etc. — The Admiralty transport service between London and Portsmouth — ^Adam Smith's opinion that good roads, canals and navigable rivers, by diminishing the expense of carriage, put remote parts of the coiuitry more on a level with those near towns — The select committees on roads 1806, 1808, 1809, 1811, 1819, 1820 and 1821— The Great North Road, the Great Western, London to Holyhead and Carlisle to Glasgow built diu*ing this period — They were all crowded and work- ing up to their full capacity — ^Also becoming very expensive to maintain — The advent of the railway saved the country a great deal of this expense and also from having to launch into costly extensions — ^It cheapened transportation and thereby not only effected important savings but greatly enlarged the area of profitable traffic — Dr. Lardner on the doubling of speed doubling the radius of the circle within which it acts, and thus quadrupling the area of ^ supply — Limitations, restrictions and obstacles with which railway pioneers had to contend — Poor surveying of the original railways — Their sharp curves, heavy grades and light construction — Short nms and frequent changes from one kind of traction to another — Small power and defective working of the primitive locomotives — Most of the early railways designed for light traffic — Primitive schedules of railway rates modelled on the canal and coaching tariffs — Roughly speaking a ton of goods is now carried for the price of a cwt. in the days of the horse carrier — The evolution of mileage rates and classifications 61-74 CHAPTER VII A CENTURY OF RAILWAY BUILDING Several types of primitive railways : the colliery tramway, the com- bined water-way and railway, the short local railway and the long distance passenger and goods line — Original locomotives built for heavy hauls rather than for speed — The first section of the Midland Railway (Leicester to Swannington) built for a coal and passenger line — Invention of the flanged wheel by William Jessop in 1788, which, according to Mr. Brunlees, introduced an organic change in railway operating — First intervention of Parliament in railway CONTENTS XXI operations — Select Committee in 1799 recommended the extension to them of the Standing Orders applicable to canals and river navi- gations — " Parliamentary powers " gradually developed into a system of parliamentary blackmail — In 1904 Mr. Acworth calcu- lated that £90,000,000, or an average of £4,000 per mile of the existing Unes, had been spent on surveys, parliamentary committees and other preliminary expenses — The first railway bills very moderately penalised in Parliament compared with what they are now — 1799, Bill for coal and passenger line from Camo Mill to Cardiff — 1801, Surrey Iron Railway or London to Croydon line — 1802, Tredegar Ironworks line — 1809, Forest of Dean — Stockton and Darlington — Liverpool and Manchester — 1820, Grey's "scheme for a general railway " — 1802, William James's Central Jimction Railway or Tramway from London to Stratford-on-Avon — How the existing trimk hnes were ultimately " muddled through " — British railways now a network of over 22,000 miles, with 20,000 locomotives, 70,000 passenger coaches and 130,000 goods and mineral wagons exclusive of those privately owned — Their charac- teristic defects are over-capitalisation and expensive operation — Their special drawbacks are official interference, parliamentary hostility, labour unrest, heavy rates and taxes, discontented traders — The new policy of co-operation and its as yet barely visible results — Duplication of train services still rampant — Combined working requires to be carried out on a national scale though not necessarily by the State — How London's coal supply might be better regulated and great savings in its distribution effected — Every- body trying to get all they can out of the railways — They should get all they can first out of themselves by means of improved working and then out of the public by increased traffic — Their final test of efficiency is maximum of work at minimmn cost and with minimum waste of power 75-86 CHAPTER VIII ELECTRIC RAILWAYS The electric railway not a mere improvement on the steam railway but a new departure — In frequency of service it has already got far ahead of its older rival — It requires a much smaller quantity of rolling stock in proportion to the volume of its traffic — It entails much less expense for train docks and sidings — The proper basis of comparison between steam and electric railways is not cost per mile or receipts per mile but average return on capital, gross and per mile — ^Electric railways 1911 (in London nine and in the pro- vinces three) — Their nominal and cash capitals — Their mileage of single track and average capital per mile — Special problem of the elec- tric railway in London — Percentages of gross and net revenue to cash capital — ^Average gross receipts of the electric railways per mile of single track — ^Average per mile of working expenses — Comparisons between typical electric and steam railways — ^Net revenues per mile of single track on electric and steam railways — Passenger traffics per mile of single track — Density of traffic on London's electric tubes and tramways — Passenger receipts on electric lines analysed and compared with steam railway receipts — ^Distinctive features of xxii CONTENTS electric traction : (1) huge capitalisation, (2) great and growing traffic, (3) heavy operating expenses, (4) low ratio of expenses to receipts, (5) meagre residuum available for dividends . . 87-101 CHAPTER IX London's overwhelming traffic The baffling problem of inter-urban traffic in general and of metropolitan traffic in particular — Three generations of railway engineers have worked upon it — First attempted solution overhead lines, second surface lines, third imderground lines — Contemporaneous arrival of the tube and the motor-bus — Their curious financial alliance and their dubious attempt to work together — Joining up the tubes and underground lines and completing the network — London's moral and sanitary dilemma — Is it a greater evil to go on growing indefinitely or to call a halt and return to a manageable size ? — Forty years' growth of passenger traffic within the metropolitan area — In 1867 the average number of journeys per head per anmmi 22-7 and in 1910 218-5, a tenfold increase while in the same period the population merely doubled itself — This excessive travelling may involve radical changes in the habits of the people with consequent moral and economic transformation — Enormous expenditure of time and money in travelling between residence and business — Waste of physical and mental energy and nerve power — Chaotic condition of London's railway system — Bad for passengers and still worse for goods — Belated attempts to divert heavy traffic from the streets and to provide independent channels for through traffic — Outer London's railway projects — Local opposition likely to render them impracticable — The Regent's Canal, City and Docks Railway the most feasible scheme of all — Burked by railway jealousies, and rivalries 102-112 BOOK THIRD— TECHNICAL CHAPTER X THE GOODS SERVICE Excessive attention of railway managers to the showier side of passenger business has checked the development of the goods service — Supremacy of the goods service should be the keynote of modem railway administration — " Full train loads " the motto of the up- to-date goods manager — " Goods expresses " now almost universal . — Examples on the North British system — Light loading the special drawback of local goods trains — The parcel business of the rail- ways in various ways overdone and improfitable — Complaints of the train men about increasingly heavier trains and larger engines — The " tranship " system of the London and North- Western Railway — ^Its unpopularity with station agents and porters — Its value in the working of long distance traffic and in interchange traffic with other systems — Its usefulness in tracing lost goods — Small pro- portion of losses on British railways compared with continental CONTENTS xxiii and American lines — The London and North-Western '* tranship " rules — Increasing work and responsibility of station agents — More scientific methods of management — British and American methods of handhng freight compared — Radical differences in the services covered by British and American rates — The American "train crew" system appears to be more economical than our station staff system — " Collection and delivery " the special incubus of British railways from which American roads are entirely free — A return to the original systemi of station to station conveyance worth considering 113-126 CHAPTER XI THE PASSENGER SERVICE Differences between the goods and passenger services — Their one point in common is the maxim that the full load is the measure of success — Inherent contradiction between regular rates and excursion rates — All special rates abolished on German railways — Rundreisey or circular tours, are now merely the sum total of the ordinary mileage fares — In the United States there is also a rever- sion to imiform mileage fares — The British season ticket necessary but improvident and open to great abuse — The fare it represents varies widely with different users — The Babel of cut rates, work- men's trains, cheap trains, week-end tickets, day returns, half-day returns, excursion parties, cheap trips, combined railway and hotel tickets, tourist tickets and what not — British passenger tariffs in 1913 are as complex and confusing as the customs tariffs of a century ago — The two, five, eight, fourteen or sixteen day return muddle — The cheap tripper had formerly to ride in the oldest coaches at the slowest speed and to be shunted into sidings in order to let regular trains pass, but now he has the best of the rolling stock, the fastest trains and the most punctual journeys — On the Great Eastern, London to Cromer, eight different fares — On the Midland, London to Leicester, four or five different fares — Half-a-dozen prices for the same article is not good business — Sir George Paish's opinion that there is a larger passenger mileage at cheap ticket rates than at the ordinary fares — Every year better service is being given to passengers, and goods traffic has to pay far more than its fair share of the expense — The popular railway manager's three favourites are the cheap tripper, the smnmer tourist and the Pullman car sybarite — Mr. H. G. Archer on " the truly amazing grand total " of tourist expresses — Cross-country expresses the latest fashion — Sir Samuel Fay's panegyric on ' ' through passenger and goods trains east, west, north and south" — Mr. Butterworth of the North- Eastem Railway on the luxurious travelling of the present day — Fishguard the last word in swagger enterprise . . 126-139 CHAPTER XII TERMINALS AND TERMINAL CHARGES English theory of railways as " common carriers " — Obscure origin of the word terminal " — In only two railway Acts are station charges xxiv CONTENTS specifically authorised — Several early Acts sanction reasonable charges for loading and unloading — By degrees as platforms, sheds, sidings, turn- tables, etc., had to be provided separate charges were added for them — ^Mr. Joseph Horrocks on railway rates — His analysis of them into charges for railage, haulage and truckage with their corresponding station services — His proposed method of allocating the cost of the various services and the charges to be made for them — Haulage not by any means the most expensive part of ^ the process of transportation — Dr. Lardner's neglected advice to railway managers that there was more money in goods than in passenger traffic — ^The long delay in recognising terminal charges — The Joint Committee of 1873 recommended that if allowed they should be brought under legal supervision — The Railway Rates Committee of 1881-2 proceeded a step further and proposed a xmiform classification of goods for the whole country to include terminal charges, the latter to be also subject to the same regulations as the rates themselves — Mr. Acworth on the large proportion of a railway rate that goes for collection and delivery, terminals and other accessory services — The consequent difficiilty of economising to any great extent on haulage — This partly explains the apparent excess of British over German and American freight rates — ^American railways neither collect nor deliver — On their much longer hauls terminals are a relatively insignificant factor . . . 140-148 CHAPTER XIII THE ROLLING STOCK Rolling stock a hitherto imder-estimated factor in railway economics — More money to be saved or wasted here than in almost any other branch of the railway service — Generally speaking it is a weak point in our railway policy — ^The free use of wagons by wholesale traders formerly a great source of expense to the companies — The outcry against demurrage charges — Error of British railways in not scrapping old and inefficient wagons — Under-loading a very ancient cause of complaint — Imperfect records of rolling stock mileage — Dr. Lardner's ton-mile formula not followed up — Census of loco- motives, passenger coaches and goods wagons in 1911 — Railway which gets the largest amoimt of work out of its rolling stock pre- sumably the most efficient — ^Average work of passenger locomotives and coaches in England, Scotland and Ireland in 1911 — ^Average work of goods locomotives and wagons. Comparative amounts of rolling stock per mile of line in England, Scotland and Ireland. Average earnings per passenger locomotive and goods locomotive — ^Average earnings per passenger coach and per goods wagon — The low average earnings of goods wagons in Scotland — Compara- tive earnings of rolling stock on British trimk lines — Confusion arising from privately owned wagons — ^Marked increase in cost of operating and maintaining rolling stock .... 149-160 CONTENTS XXV BOOK FOURTH— COMMERCIAL CHAPTER XIV THEORIES OF RATE-MAKING Complexity of modem railway rates — ^Their conflicting terms and conditions — Limitations and checks on rate-making power — ^Mr. Grierson of the Great Western Railway on how the original rates were arrived at by negotiations with traders and manufacturers — No " natural " or " scientific " basis of rates possible — ^They have now become questions of party politics — ^AU the old principles and methods of rate making brushed aside — They were based on the doctrine that railway proprietors and operators are entitled to a fair return on their outlay — Mr. Acworth's " cost of service " theory ^ — ^Declared by the older generation of railway managers to be only approximately accurate — Professor Hadley's "development of traffic " theory — Better adapted to American than to British railways — ^Worthy of greater attention from our railway managers — Charging according to the value of the goods or "what the traffic will bear " — Classification an indirect form of rate making — Exces- sive subdivision of railway charges — Original classifications based on value taking into accoimt weight and bulk — Professor Hadley's statement that a great deal of freight of small value is carried not merely at less than the average rates but at less than the average cost — Mr. C. P. Huntington of the Southern Pacific Railway argued that when a paying train load had been secured all additions were so much extra revenue — Mr. Acworth's three fundamental rules of railway policy: (1) get trafl&c, (2) charge no prohibitory rate, (3) have no rate so low as not to cover the additional cost which the particular traffic entails — The three stages in the evolution of British rates: (1) individual tariffs, (2) associated tariffs, (3) Par- liamentary and Board of Trade tariffs — ^Maximum and minimum schedules 161-172 CHAPTER XV REGULAR RATES AND FARES Original railways adopted mail coach fares and classes — Station agents, drivers, guards, porters all christened with mail coach names — At an early period a penny a mile became the standard third-class fare — Original goods traffic organised on canal models — How the railways began with high-grade traffic and gradually reached out for the lower grades — ^Sir George Findlay's defence of the rates then in operation (1880) as being governed by the nature and extent of the traffic, the pressure of competition by land or water, and the commercial value of the commodity — Mr. Grierson's de- fence of " what the traffic will bear " — The income tax analogy — " Obtaining the revenue of the country from the persons who can best afford to pay " — Mr. Acworth's justification of graded rates, xxvi CONTENTS from the lowest which barely cover out-of-pocket expenses up to the highest which leave a large surplus to cover the deficiencies of the lower grades — This again is more American than British, and it is doubtful if either British traders or shareholders would approve of it — Professor Hadley's version of it — Governing principle of present-day management is to obtain a living return on the capital cost of the railway, and to divide the charge as equitably as possible over the various classes and grades of freight — The question con- fused and befogged by parliamentary interference — Traders be- wildered by thousands of through rates, local rates, distance rates, terminal charges, " collection and delivery " rates, owners' risk rates and A, B, C rates — On a single consignment there may often be eight or nine different items to work out — Less Philadelphia law and more plain business sense needed in the goods service 173-182 CHAPTER XVI EXCEPTIONAL RATES AND SERVICES Our fundamental law of freight rates and classifications embodied in the Acts of 1888 and 1894 — Clearing House threefold division of traffic : (1) parcels, (2) " smalls " (under three cwt.), and (3) heavy traffic — ^A, B, and C rates are of two kinds : first, for low-grade freight such as coal, iron ore, bricks, cement, etc., and secondly, for large quantities of higher class goods — Exceptional rates much more common than is supposed — At other extreme some kinds of light traffic unduly favoured — Passenger train parcel service of very doubtful value — The quick delivery service absurdly over- done — Panegyrics on it by Lord Stal bridge and Sir George Findlay — Misfortune for the railways that the pre-existing carrier service of Pickford & Co. and others was not fitted into the railway system — It could have co-operated with the railways instead of competing with them as it did at the outset — Lord Claud Hamilton on the " rapid dispatch " craze of 1906 and the insane competition it produced — Legitimate as well as illegitimate forms of rivalry, but much less heard about them — Sometimes economic causes for exceptional rates — The special difficulty of " back loading " — Mr. Grierson on the "load up at any price " policy — Inconsistency of railway companies in fighting for higher statutory powers than they dare to use — " Collection and delivery " rates often im- remunerative — The extravagant cartage services in large cities, London especially — Questionable competition with the Parcel Post — Railways handicapped by their accessories — Some terminal stations have cost as much as would build a hundred miles of line — Traders more frequently complain of unfair or unequal than of excessive rates — The chief object of the earlier Railway Acts was to prevent discrimination in rates or service — Effect of the Rail- way Clauses Consolidation Act and its proviso, that "all such tolls be at all times charged equally to all persons " — This adopted from the old common carriers' law — The Consolidation Act of 1844 allowed the railways more freedom than the Consolidating Act of 1894 183-194 CONTENTS xxvii CHAPTER XVII COMPETITIVE RATES Causes of competitive rates divisible into (1) economic, (2) compulsory, that is resulting from outside competition, (3) voluntary, or originat- ing with the railways themselves — Repeal of the Com Laws caused an agricultural and commercial revolution which demanded new channels of transportation — External competition by road or water has only of late become serious — Rivalry among railway managers was in the Victorian Age disastrous, but is now dying down — Bradford as an example of insane fighting for traffic — The Economist on the scramble for Manchester business in 1907 — The new policy of rearranging competitive stations so as to avoid duplication and triplication — Domestic and foreign rates — Mr. Grierson's plea that export trade has always been favoured — The Stockton and Darling- ton Railway's halfpenny per ton per mile for export coal, and four- pence per ton per mile for inland — Water carriage had given foreign trade an advantage over home trade before railways were bom — Farmer's Magazine^ 1840, on the carriage of wheat from Hamburg to London and from Hertfordshire to London — The Southampton Docks case showed that full loaded trains of foreign produce paid the railway better at 6s. per ton than small consignments of local produce could do even at 155. per ton — This was a case for what the Americans call a " development " rate — The south coast rail- ways are at last adopting this policy, and late in the day as it is the results are very satisfactory both to the local producers and to the railways — British traders and railway discrimination — Commercial activity of the Victorian Age — The prolonged struggle of 1880-1894 for luiiform and intelligible railway rates — Present House of Com- mons hostile to the railways — Mr. H. M. Hyndman's diatribe against them 195-205 CHAPTER XVIII LONG AND SHORT HAUL RATES Short-haul railways like the British are heavily handicapped by ter- minal charges, and the heavier these charges are in comparison with the haulage charge the worse is the handicap — Consequently short hauls and expensive terminals are the two weak points of our system — French as well as American experience proves that long hauls at low rates pay better than short hauls at high rates — Mr. Marriott's analysed items of typical goods rates between Manchester and Bradford and Colne and London — The high rate on the first twenty miles, lower rate on the next thirty miles, and still lower rate on the next fifty miles abolishes all the advantages of local markets — Should the surcharge on short-distance hauls be main- tained ? — ^What long-distance hauls at very low rates have done for the development of the North-west and of the Pacific coast generally — An historical study commended to British railway officials — Mr. J. J. Hill on British and American rates — Sir George Gibb's comparative examples — Mr. Hill's maxim that the railway can only increase its traffic by increasing the business of its customers xxviii CONTENTS — How the lumber business of the Pacific slope was built up by a rate of forty cents per cwt. for a distance of 2000 miles, equal to two-fifths of a cent, per ton per mile — Rate-making power has been a great factor in American industrial development both East and West 206-217 BOOK FIFTH— ADMINISTRATIVE CHAPTER XIX THE DIRECTORS British railway directors practically co-optive — Shareholders have little or no voice in selecting them, and seldom see them except at the statutory meetings — These hitherto half-yearly, but in future to be only yearly — Practice of taking retiring General Managers on the Board — Directors not as a rule technical men — Railway Boards made up of local landowners, ironmasters, shipowners, manufacturers, and one or two practical financiers — Chief qualifi- cation ability to bring business to the company — Peerage well represented on most railways — Business directors rarely take ad- vantage of their positions for their private interest— In recent years indirect danger of their being too conciliatory to railway- men where strikes on the line might shut down their own works — It has happened that districts in which railway directors or managers are interested have been better served than competing districts without these advantages — Shipowners are at the present day a dangerous class of directors — As in the case of Fishguard they may tempt a Board into large capital expenditiire of an unremunerative character — Formerly a business reputation of any sort was deemed a good passport to the railway Board-room — ^Ex-Ministers generally favoiu-ed — ^The London and North- Western chairmanship offered to the late Mr. W. H. Smith when he retired from office — Local members of Parliament at one time in request, but now at a discount — The Bank of England and its amateur Governors — Practical sagacity and absolute trustworthiness make up for technical short- comings — First generation of railway directors acknowledged no responsibility to the State or to anybody but their shareholders — Dr. Lardner advocated an efficient system of control — He was also in favour of general publicity and detailed accounts — ^American rail- way Boards originally formed on British model, but it has been entirely changed— The Canadian Pacific directorate compared with a typical English Board — The patriarchal directors of twenty years ago dying out — Their successors of to-day begin young and undergo regular training on the committees, which divide amongst them the supervision of the various branches of administration . 218-228 CHAPTER XX THE EXECUTIVE OFFICERS The first railway Acts of Parliament required only two officials, a secretary and treasurer — Their duties minutely specified, but the CONTENTS XXIX chairman, the manager and all the subordinate officials were optional — The secretary was usually General Manager as well, but sometimes it was the Chief Engineer — Occasionally the treasurership was entrusted to a bank : hence the large number of railway accounts held by certain big banks — Sir George Findlay's account of the London and North- Western staff in his day — ^Mr. Fisher's summary of the duties of a General Manager — Of late years they have been greatly and it may be even dangerously increased by the multipli- cation of " side shows " — In any case the " side shows " must to a certain extent distract his attention from his proper duties Sir William Van Home on purveying for railway hotels — Railway engine and car building works very doubtful economies — Railway harbours and docks notoriously poor speculations — " The cook, barber and lady's-maid " trains de luxe — Excessive multiplication of officials and operators tends to intensify labour unrest — Executive organisation develops slowly, and is still primitive compared with that of foreign railways — ^Anomalous position of passenger staff — Superintendent of the line as chief ticket agent — ^A well-organised passenger department needed — The folly of hiring out passenger trains to excursion agents and spoiling the regular business of the line — The executive staff of the Canadian Pacific Railway com- pared with that of the London and North- Western — ^The reticence of railway officials in England and Scotland contrasted with their frankness in the United States — The conferences and friendly dis- cussions of American railroad managers with their customers — Good relations cultivated with Chambers of Commerce, agricultural clubs and traders generally ...... 229-241 CHAPTER XXI THE WORKING STAFF Systematic and sympathetic study of the economic conditions of wage- earners a peculiar feature of our time — Board of Trade inquiries into their earnings and hours of labour — The threatened national strike of 1907 owed its chief terror to general ignorance of the rail- way situation — This defect has now been to a large extent cor- rected — The census of railway servants, 1907 — Mr. Barnes, the editor, pays a high compliment to the railway companies for the cordial assistance they rendered in its preparation — Tabular summaries of weekly wage of men and boys on steam railways, their average rates of wages and actual earnings — The same for electric railways — Peculiar advantages of railway labour as acknowledged by the more fair-minded of the men themselves — Their freedom to organise and the use they have made of it — ^The Conciliation Boards and the divided opinions of the men regarding them — The special favour Labour enjoys in the House of Commons — The selfish class use made of the Labour vote — Its invariable and increasing hostility to railway Bills — The grievance-mongering campaign of the National Union of Railwaymen — Disregard of contracts and written engage- ments — Good faith and common honesty indispensable under any system of railway ownership — Even trade unions are liable to strikes — Practical question is, what sort of a return the railwayman should make for his wages?— ^Spasmodic revolts on the North-Eastem and CONTENTS the Midland Railways — Railwaymen aim at becoming co-optive like the directors 242-253 CHAPTER XXII FOUR NATIONAL RAILWAY SYSTEMS The peculiar evolution of British railways out of the preceding mail coach and common carrier regime — ^The typical pioneer railway of the Old World entirely different from that of the New World — British and American railways represent the two antipodes of modem transportation — Railway mileage of the world — ^About half a million miles now in operation — Three-fifths of it are embraced in four large networks : British, French, Prussian and American — Their mileages of line and of single track compared — Their capitalisations per mile of line — Causes of the apparently heavy capitalisation of British railways — Some errors of British railway pioneers — The four great national systems compared in respect of gross revenues, working expenses and net revenues — Remarkable uniformity in their average gross receipts and working expenses per mile but great disparity in their net receipts — Their rolling stock per 1000 miles of line — American roads do most work in proportion to their mileage and equipment ....... 254-267 BOOK SIXTH— THEIR POLITICAL RELATIONS CHAPTER XXIII TO THE LEGISLATURE Railways at first warmly welcomed — When success made them power- ful reaction followed and they were treated as monopolists — Railway legislation from 1844 to 1894 swayed between these two extremes — Fimdamental principles of our railway policy laid down in the report of the Select Committee of 1844 believed to have been written by Mr. Gladstone — Its acknowledgment of the superior cheapness, security and rapidity of traveUing due to the railways — Its declaration that they combined immense benefit to the public with a very moderate standard of average remuneration to the projectors — Nevertheless, they should be subjected to "habitual and effective supervision on the part of the Government " — Railway Department of the Board of Trade with Mr. Samuel Laing, after- wards Chairman of the Brighton Railway, at its head — The Com- mittee of 1844 foreshadowed " a great system of communication binding together the various districts of the coimtry " — This parliamentary dream has been very imperfectly realised — The acctmiulation of statutory restrictions and disabilities — Regulative authority divided between Parliament, the Board of Trade, and the Railway Commissioners — Railway managers differ greatly as to the value of these respective tribunals — The late Sir Robert Inglis of the Great Western Railway preferred to deal with Parhament itself — Diu-ing past half-century periodical outbreaks of anti-railway agitation — Between 1888 and 1894 a continuous battle of rates and classifications fought with traders — This no sooner settled than the labour campaign commenced which gradually developed into CONTENTS XXXI open war — Railways now at a deadlock between traders and trade unions — Railways have very little power left to adapt themselves to circumstances and still less to grapple with national emergencies — ^Much better position in this respect of German railways — Just legislation for railways impossible while existing prejudices and hostilities continue rampant in the House of Commons . 268-278 CHAPTER XXIV TO THE TRADERS Relations of railways and traders artificially complicated by political and ofiicial intervention — Earliest railway rates experimental and necessarily to a large extent arbitrary — Afterwards they were muddled up in the parliamentary feuds of the railway companies and in their pooling schemes — The Select Committee of 1888 on the seven classes of complaints made by traders against the railway companies — These have since been largely remedied as far as rates and classifications are concerned — The Consolidating Act of 1894 gave traders a definite position — Only a small percentage of railway business ever comes before the Railway Commissioners — Analysis of complaints and adjudications in the ten years 1888 to 1897 — More friendly tone toward railways adopted of late by Chambers of Commerce — Important railway resolutions adopted at the Chambers of Commerce Conference in March 1912 — Conciliatory speech by Sir Charles Owens of the London and South-Western Railway — A give-and-take policy between railways and traders the best solution of the difficulty — Increased powers of mediation might be conferred on the Board of Trade . . . 279-288 CHAPTER XXV TO THE LOCAL AUTHORITIES Formerly the growth of rates and taxes one of the chief grievances at shareholders' meetings — This for a time checked but now re- appearing — The large share of railway earnings taxed off averages fully one per cent, of dividend — In return for this disproportionate taxation railways receive less benefit than any other class of tax- payers — In 1911 rates and taxes exceeded five millions sterling, a sum nearly equal to the coal bill of same year — The total cost of the locomotive service, excluding repairs and renewals, was only £600,000 more than the rates and taxes — Great increase during the pa«t ten years under each of these heads — The opposition of town councils, district councils and even parish councils to railway im- provements is becoming a mania — Metropolitan authorities have distinguished themselves as railway "squeezers " — Thanks to them, London terminal stations have cost 20 or 30 per cent, more than they ought to have done — The dismal story of the Liverpool Street Station — Mr. Gooday's accoimt of how the Great Eastern Company was blackmailed for workmen's dwellings, workmen's trains and all the other fads of municipal philanthropists — So- called cheap trains on suburban lines cost actually more to run than regular passenger trains — The trader, the trade unionist, the municipaliser, the nationaliser, and the politician at large are all in arms against the railway shareholder . . . 289-297 xxxii CONTENTS CHAPTER XXVI THE RAILWAYS AND THE STATE The socialisation and nationalisation bogeys — ^The personal factor in industrial disputes is nowadays more powerful than any theoretical factor — State control no new idea in railway history — ^Almost from the beginning it has been asserted in one form or another — ^The State is now a universal providence — It could never interfere much more with the railways than it does already — The real question of to-day is not how to get an ideal system of State railways, but how to get the best possible results out of the existing system — If State control is to be developed into nationalisation it should be non- political and independent of all outside dictation, parliamentary or otherwise — It would have to be preceded by a workable treaty of peace between the railway companies, the traders and the trade unionists — An effective State should be a power of itself, something above and beyond the governed — The Prime Minister of New South Wales and the gas workers' strike in Sydney — He declared the issue to be between the strikers and the Government — A State powerful enough to arbitrate between employers and employed would have to be a virtual dictator — Not shareholders but railway- men the greatest obstacles to nationalisation — The Select Com- mittee of 1838 on necessary safeguards against railway monopoly — In 1886 Mr. Grierson protested against the arbitrary powers then claimed (unsuccessfully) by the Board of Trade — Can an equitable and effective State control be created out of existing authorities, the Board of Trade and the Railway Commission ? — ^Mr. Wardle, M.P., on the common interest of railway shareholders and railway- man in Government supervision 298-307 CHAPTER XXVII NATIONALISATION A many-sided question : financial, political, commercial and sogiaLs-Its recent tendency to become a special phase of the universaTclass war — Nationalisation may become a sheer necessity through the break- down of existing organisation — Not shareholders or officials, but railwajnmen, have most to fear from it — Ultimate issue will be between railway rates and wages — Under a national regime traders and employ6s will be natural enemies face to face with each other — Trade union policy inherently opposed to a progressive railway policy — Recent labour agitations have all been economic failures in so far as they have benefited the few at the expense of the many — The larger amount paid in wages has been distributed among a smaller niunber of men — ^Nationalisation from the State point of view — The State has first to solve the road problem before it can venture to grapple with the much larger railway problem — The grievances of traders against the railways are largely due to slip- shod law-making — Plainer laws and cheaper courts are urgently needed for the settlement of railway disputes;— The Railway Act of 1913 the latest and worst example of political intervention — ^The all-round advance in railway rates which has resulted from it may produce interminable disputes and controversies — ^Ultimate national- isation a factor in all future railway discussions . . 308-320 BRITISH RAILWAYS BOOK FIRST— FINANCIAL CHAPTER I WHAT THEY HAVE COST In 1911 there were, according to the annual report of the Board of Trade, 23,417 miles of railways in the United Kingdom. They were worked by two hundred and fifty different companies which had a paid-up capital of 1324 millions sterling. Fully one-seventh of that amount (198 millions) was, however, nominal, having been added to counterbalance reductions in the rates of interest or dividend. Nearly all the principal railway companies have, at one time or another, reorganised or consolidated parts of their capital. In doing so Debentures and Preference stock carrying high rates of interest have been converted into new stocks bearing lower rates of interest. In order to equalise the income of the holders with what they previously received the nominal capital has been increased. Thus when a six per cent. Debenture yielding £6 per annum was converted into a new four per cent., £150 of the new stock had to be given for each £100 of the old. About 105 millions sterling of nominal additions to the Debenture and Preference stocks have been made in that way. Nearly 93 milhons (£92,700,000) more have resulted from the process known as *• stock-splitting." When the market prices of Ordinary stocks become too large to be easily dealt in they may be divided into Preferred and Deferred halves, or they may be duplicated. The former is the older practice, and the chief examples \ 2^/,\ \y\^ iy: : feRI$TS$ RAILWAYS of it are the Brighton and South-Eastern splits. In these cases £100 of Ordinary stock is divided into £50 Preferred and £50 Deferred Ordinary. Of late years splitting has taken the Irish form of dupHcation. For instance, when Midland Ordinary, London and South- Western and North British stocks were spHt, £100 of Preferred and £100 of Deferred were issued for every £100 of the Ordinary. This process has been carried to the extent of creating about 93 millions of nominal stock. Up to the end of 1911 the creations of Debenture, Preference and Ordinary stock in connection with con- versions and reorganisations totalled £198,100,000. Politicians with strong prejudices and loose ideas of finance sometimes declaim against these nominal additions to our railway capital as " watered " stock. That is not true of them in any invidious sense : such, for instance, as it would be understood in by American stock-holders. They are not " water," but rather book entries. No one need be misled by them, as every railway company dis- tinguishes them in its accounts from capital actually paid up. They are also stated separately in the annual returns of the Board of Trade. The only occasion on which they may have a misleading effect is when the cost per mile of British railways is being compared with the cost per mile of foreign railways. In this case the nominal additions that have been made to our railway capital raise the capitaHsation per mile a good deal higher than it actually is. But the persons who make such comparisons can easily guard themselves against that mistake by deducting the nominal additions. Also in making adjustments there are others on the opposite side to be remembered. A considerable set-off to the so-called " water " would result if we could ascer- tain the total amount of capital that has been written down or written off altogether as lost. In drastic re- organisations such as the Great Eastern and the London, Chatham and Dover railways underwent, large amounts of original capital were wiped out. Before we could ascertain the actual effective cost of our railways, many adjustments and quaHfications would WHAT THEY HAVE COST 3 have to be made in the official figures of the Board of Trade. The nominal additions and reductions in their capital accounts are only first steps in a prolonged inquiry. Apart from the official values there are market variations to consider. Some railway stocks command high pre- miums, while many more have fallen to heavy discounts. Would the market valuations of to-day not be a safer guide for us than the par values of the original stocks ? This is an interesting question awaiting the attention of statisticians. In judging the actual cost of a given railway as it stands to-day attention has to be paid to its past history. Nothing could be more illogical than to estimate two such widely different properties as the London and North- western and the London, Chatham and Dover at the par values of their stocks. Not only are they miles apart in their market prices, but one of them has a mountain of unearned interest standing against it, while the other has a long unbroken record of substantial dividends. Every £100 put into Chatham Ordinary stock sixty years ago would now amount at compound interest to nearly £1000. But the unfortunate owner could get only £20 for it. There is a case of a railway stock which has cost about ten times its nominal amount. Happily there are equally remarkable examples of an opposite sort. Every £100 invested sixty years ago in London and North- Western stock has yielded enough in dividends to repay the whole of the capital with four per cent, interest. The good stock has redeemed its original cost, while the bad one has multi- plied its original cost tenfold. The necessary adjustments to cover these two opposite changes would require a large addition to be made for the one and a large reduction for the other. London and North- Western stock would have more than repaid itself and fair interest as well, while Chatham Ordinary would have to be debited with an impossible accumulation of arrears. But the Board of Trade has to take the nominal capitals as furnished by the railway companies and treat them as all of equal value. It can pay no regard to the reductio 4 BRITISH RAILWAYS ad absurdum of placing on the same statistical level a huge plus and a huge minus quantity. One day perhaps we may obtain from it detailed calculations of the market values of our railway stocks at the end of each year. These would be a novel and useful addition to its annual reports. With their help all persons interested in railway stocks, whether as dealers or holders, could obtain com- prehensive views of the railway situation as a whole. If existing statistics of railway capitaMsation be very imperfect from a general point of view, they are much more so in their individual parts. They are virtually useless with reference to such essential questions as cost per mile of railway. All comparisons of that sort are utterly misleading. They put one-horse, single-track hnes on a par with trunk lines having many miles of four- and six-track road. Of late railway statisticians have got over this difficulty to some extent by adopting single- track mileage as the basis of their comparisons. What a difference this makes may be seen in the subjoined table of line miles and single-track miles for the railways of the three kingdoms : — Line* and Single-Track Mileages Compared. ' MUes of Line. Miles of Single Track. Single Track for each mile of Line. England and Wales . . | 16,200 Scotland i 3,815 Ireland | 3,402 42,212 7,773 4,591 2-6 20 1-35 ! 23,417 54,576 2-33 It is obvious from the above that comparisons between the English, Scottish and Irish railways in respect of capitalisation will be much more just as between the three countries, as well as more instructive, if the mile of single track be adopted as our unit of measurement in place of the mile of hne. This consideration applies still more strongly to comparisons between British and foreign railways. In the case of American railways it is WHAT THEY HAVE COST 6 particularly important, such a large proportion of their mileage being single track, and very indifferent at that. It may be observed here that in our comparisons all mileage will be reduced to single track, and in calculating capitalisation per mile all nominal additions will be excluded. Only actual cash capital will be regarded. On this basis the railway systems of the three kingdoms compare as under : — British Railway Capital less Nominal Additions, 1911. 1 Total Capital. (Milliona.) Nominal Portion. (Milliona.) Net Caah Capital. (Millions.) England and Wales . . Scotland Ireland £ 1,093-2 185-8 43-8 £ 148-5 49-3 0-2 £ 944-7 136-5 43-6 1,322-8 198-0 1,124-8 British Railway Capital per Mile of Single Track, 1911. Cash Capital. (Millions.) Miles. (Single Track.) Per Mile. England and Wales . . . Scotland Ireland £ 944-7 136-5 43-6 42,212 7,773 4,591 £ 22,380 17,600 9,500 1,124-8 54,576 1 20,600 Writers who indulge in sweeping generalisations as to the excessive capitalisation of British railways can, by taking the total capital inclusive of nominal additions (£1,322,800,000) and dividing it by the number of miles of line (23,417), produce a very high average cost per mile. It is, in short, close on £60,000. That is the round figure usually adopted by severe critics, especially foreigners. But when we eliminate the nominal addi- tions and the large proportion of two-, three- and four- track lines, a much less formidable amount will be arrived at. For Ireland the average is little more than £9000 6 BRITISH RAILWAYS per mile of single track, and for Scotland it is £17,000, and even for England it is only a trifle above £22,000. These widely divergent averages for the three kingdoms are in themselves another warning against hasty general- isations. Even in such a comparatively small section of the globe as the United Kingdom general averages may be very misleading. It should be obvious at a glance that a railway system like the Irish, which has cost only £9500 per mile of single track, must have been built under very different conditions and for a very different class of traffic from one hke the English, which has cost nearly three times as much. In England itself a great diversity of railway building may be found. Small an area as it is geographically, seven or eight distinct groups of railways flourish in it. The trunk lines running north and west form the main group, and we deal with these by themselves. They are distinguished by their combination of goods and passenger traffic, the goods predominating. The southern lines are sometimes spoken of as passenger lines, their passenger traffic being the most important. In other districts of England and Wales mineral traffic predominates, and we have consequently a special group of mineral lines. London itself has four different railway services — trunk lines, surburban lines, street railways, and undergroimds. When we inquire into the capitalisation of these various systems the utmost diversity comes to light. In order to do justice to each group it must be taken separately, and its distinctive conditions carefully analysed. At every turn the widest diversities will be foimd among them, and the more they are studied the more striking will be the absurdity of lumping them together in statis- tical comparisons. Beginning with the trunk line group, which embraces nine of our largest and most successful railways — ^the London and North- Western, Midland, Great Western, North-East ern, Lancashire and York- shire, Great Northern, Great Eastern, Great Central, and London and South-Western — a most interesting study in the science of capitalisation presents itself. These nine systems have to account for a good deal more WHAT THEY HAVE COST than one -half of the railway capital of the country. With their respective shares of the nominal additions they aggregate 791 millions sterling, but without these they only amount to 658 millions. The nominal additions to their various classes of capital — ^Debenture stock, Preference and Ordinary — must thus have been about 133 millions sterling. The following table indicates how they are distributed among the various lines. The Midland Railway, it will be seen, has much the largest share of super capital — 73f millions sterling — ^and the Great Western has the smallest. To be strictly accurate the Great Western capital is not higher, but lower, than the actual money paid in, £742,000 having been written off. The cash capital of the whole group was 658 millions, and the nominal additions made at various times aggregated 132| millions. This raised the total to its existing figure of 791 millions. Trunk Lines, 1911. Their Total Capitals less Nominal Additions. Total Capital. (OOO'a) Nominal. Portions. (OOO's) Cash Capital. (OOO's) London and North-Western Midland £ 126,062 193,624 99,028 80,689 70,349 52,898 64,405 69,640 55,430 18,678 73,788 742* 7,018 11,473 478 2,681 8,589 10,904 £ 106,374 119,736 99,770 73,671 68,876 62,420 61,824 61,061 44,526 Great Western North- Eastern . . . Lancashire and Yorkshire Great Central . . . Great Eastern . . . Great Northern . London and South -Western 790,916 132,767 658,148 ♦ Capital written down. Thus it appears that 17 per cent, of the capitalisation of our trunk railways is purely nominal. It is not " water *' in the American sense, but rather a book- keeping adjustment. In scientific comparisons of cost of construction it must be ehminated, and this preliminary reduction is alone sufficient to set our railway capital- d BRITISH RAILWAYS isation in a much more favourable light than it is generally presented in. Its significance becomes much more apparent when expressed in mileage averages, as will be seen in the next table. Spread over 12,533 miles of railway, £132,767,000 represents £10,600 per mile, and reduces the average cost of our trunk lines from £63,000 to £52,500 per mile. Trtjnk Lines, 1911. Nominal and Cash Capitals Reduced TO Mileage Averages (12,533 Miles). Nominal Capital. (000*8) Per Mile. Cash Capital (less nomi- Per Mile. nal portion). (OOO's) London and North-Westem Midland 126,102 193,524 99,028 80,589 70,349 62,898 64,405 59,640 55,430 £ 63,600 126,300 32,900 46,600 119,000 70,000 48,000 69,600 57,500 106,374 119,736 99,770 73,571 58,876 52,420 51,824 61,051 44,526 £ 64,100 78,100 33,200 42,600 99,600 69,200 45,800 59,600 46,200 Great Western North-Eastern . . . Lancashire and Yorkshire Great Central .... Great Eastern .... Great Northern London and South-Westem 790,965 63,100 658,148 52,500 It is not alone the capitalisation of our railways that has to be adjusted in order to admit of fair and equal comparisons with other railway systems; the mileage has also to be reduced to a common level. Fully 90 per cent, of the railway lines in the United States are single track as compared with 45 per cent, of the British lines. In other words, 55 per cent, of our lines have two or more tracks, and some parts of them as much as eight or ten tracks. On the Prussian lines the proportion of the mileage with two or more tracks is 42*3 per cent., and in France it is 43 per cent. All these are so much under the British average as to preclude fair comparison. The only alternative is to reduce all the line miles to single-track miles as under : — WHAT THEY HAVE COST Trunk Lines, 1911. Cash Capital peb Mile of Line and per Mile of Single Track. Capital. M«es of (OOO's) ! ^'''^^ Per Mile. Miles of Single Track. Per Mile. London and North- Western Midland 106^374 119,736 99,770 73,571 58,876 52,420 51,824 51,051 44,526 1,966 1,532 3,006 1,728 591 757 1,133 856 964 54,100 78,100 33,200 42,600 99,600 69,200 45,800 59,600 46,200 5,502 4,852 6,645 4,842 2,194 2,252 2,540 2,655 2,218 19,300 24,700 15,000 15,000 26,800 23,300 20,400 19,200 20,000 Great Western . . . North-Eastern Lancashire and Yorkshire Great Central . . . Great Eastern Great Northern . . . London and South- Western 658,148 1 12,533 52,500 33,700 19,500 A simple indication of the comparative density of traffic on a railway is the proportion of single track to miles of line which it exhibits. In this respect the Lancashire and Yorkshire stands highest, its proportion being 3*7 miles of track for every mile of line. The Midland is second, with 3*2 miles of track for every mile of line; the Great Northern third, with 3-1, and the Great Central fourth, with 3. Strange as it may seem, the London and North- Western has a small proportion of multiple tracks — only 2*8 per each mile of Hne. The North-Eastern proportion is the same as the North- Western's, and the smallest of all is the Great Western's, 2*17 of single track for every mile of line. The trunk-line group of railways whose capitalisation we have been analysing is by far the most important in the United Kingdom. It is also the most typical of our railway traffic as a whole. All the other groups are much smaller and more specialised, but they are no less worthy of investigation. They are not only interesting in themselves, but they throw light on each other. Let us take as our next group three typical passenger hues — those of the south coast. As regards capitalisation, their chief peculiarity is that the nominal additions have been very few, and such as they are they were not made voluntarily. 10 BRITISH RAILWAYS The Brighton and the South-Eastern Ordinary stocks have both been subjected to splitting schemes, but they were genuine spHts and not duplications, as in the later cases of the Midland, the Great Northern and the North British. The Chatham capital has had nominal additions made to it of another kind, in the shape of stock issues at a discount. Its disastrous history has inflicted on it the invidious distinction of being the most heavily capital- ised steam railway in the United Kingdom. But all three of the southern lines, it will be observed, have cost their shareholders a good deal more per mile than most of the trunk lines did. The totals and averages in 1911 were : — Southern Lines, 1911. Their Average Cost per Mile of Line. Miles. Total Capital. (OOO's) Per MUe. South-Eastern .... Chatham London and Brighton . 444 185 32,485-0 29,629-0 £ 73,100 160,000 629 454 62,1140 29,115-0 98,700 64,000 1,083 91,2290 84,200 Their Average Cost per Mile op Single Track. Miles. Cash Capital. (OOO's) Per MUe. South-Eastern and Chatham London and Brighton . 1,588 1,234 £ 62,1140 29,1150 39,000 23,600 2,822 91,2290 32.300 For their excessive cost these southern lines have not the excuse that the trunk lines can plead, of dense traffic necessitating a large amount of multiple track. Their 1,083 miles of line reduced to single track make only 2,822 miles, or 2*6 miles for every mile of line. The Brighton average (2*7) is a shade better than that of WHAT THEY HAVE COST 11 the South-Eastern and Chatham system, which is only 2*5. Consequently all the southern capitalisations are high even when reduced to terms of single track. Not one of them in the above list but is well above the average of the trunk lines, namely, £19,500 per mile. From the southern passenger lines we turn now to an entirely difiFerent class, the mineral lines. Nine of them have been selected to form a typical group, and they are as representative in their way as the nine trunk Unes. They will be put through a similar process of comparative analysis, beginning with the disentanglement of their actual from their nominal capitals : — Mineral Lines, 1911. Their Nominal and Cash Capitals. Total Capital. (OOO's) Nominal Portion. (OOO's) Cash Capital. (OOO's) North Staffordshire Taff Vale . . . Hull and Barnsley Cardiff . . . Barry .... Rhymney Furness . . . Brecon and Merthyr Neath and Brecon £ 10,693 9,821 8,322 6,333 6,283 2,766 2,818 2,086 1,337 £ 1,891 3,764 383 1,458 631 1,044 331* 8,802 6,067 8,322 6,960 4,826 2,136 1,774 2,086 1,668 60,468 8,830 41,628 Capital written off. Having ascertained the cash capital that has been put into these mineral lines, and shown how it compares with the nominal capital charged against them in the com- panies' accounts, we can now carry the comparison a step further and work out the mileage averages. These have to be taken first on the nominal capital, and secondly on the actual capital. The results are surprisingly similar to those obtained from the trunk-line figures. In this case the average cost per mile is £11,000 lower on the actual than on the nominal capital : — 12 BRITISH RAILWAYS Mineral Lines, 1911. Nominal and Cash Capitals Reduced to Mileage Averages (795 Miles). Nominal Capital. (OOO's) Per Mile. Cash Capital. (Less Nominal Additions.) (OOO's) Per Mile. North Staffordshire Tall Vale . . . Hull and Barnsley Cardiff .... Barry . . Rhymney Furness Brecon and Merthyr Neath and Brecon £ 10,693 9,821 8,322 6,333* 6,283* 2,766 2,818 2,085 1,337 £ 49,500 79,200 91,450 54,200 21,000 35,340 33,400 £ 8,802 6,067 8,322 5,950* 4,825* 2,135 1,774 2,085 l,668t £ 40,700 49,000 91,460 41,860 13,240 35,340 41,700 60,458 63,600 41,628 52,360 ♦ Chiefly docks. t £330,000 written off. Still pursuing the same analjrtic method that was applied to the trunk-line group, we have now to distin- guish the cost per mile of single track from the cost per mile of line. For the sake of extra clearness two sub- groups have been made — one English and the other Mineral Lines, 1911. Cash Capital per Mile of Line and per Mile op Single Track. Cash Capital. (OOO's) Miles of Line. Capital per MUe. MUes of Single Track. Capital per MUe of Track. North Staffordshire . Hull and Barnsley Furness TaffVale .... Cardiff Barry ..... Rhymney .... Brecon and Merthyr Neath and Brecon . £ 8,802 8,322 1,774 216 91 134 £ 40,700 91,450 13,240 501 295 369 £ 17,670 28,200 48,000 18,898 441 42,800 1,165 16,200 1 6,067 5,950* 4,825* 2,135 2,085 1,668 124 14 66 61 59 40 49,000 41,860 35,340 41,700 387 129 287 162 107 64 15,670 13,200 19,500 30,900 22,730 354 64,200 1,126 20,200 Including docks. WHAT THEY HAVE COST 13 Welsh. The former includes three of the best-known mineral lines in England, and the second embraces half-a- dozen typical Welsh lines. In both sets of averages the Welsh appear to be much higher than the English, an anomaly which explains itself when we remember that a number of the Welsh lines, such as Cardiff and Barry, are dock as well as railway undertakings. The metropolitan railway service is a vast and unwieldy subject which had best be dealt with by itself. Most of the metropolitan lines being now electrified, their methods and results cannot be closely compared with those of steam railways — another reason for separate treatment. We pass on, therefore, to the Scottish railways, of which half-a-dozen may be selected as a tj^ical group. Their nominal capital, as shown below, amounts to 176 miUions, of which fully 49 millions, or 28 per cent., is due to duplication of stocks. This is nearly double the English percentage (17), and when eliminated it leaves only 127 millions of actual cash capital : — Scottish Links, 1911. Their Nominal and Cash Capitals. Total Capital. (OOO's) Nominal Portion. Cash Capital. (OOO's) Caledonian Glasgow and South- Western Highland North British .... Great North of Scotland . 70,578-2 24,873-7 6,871-1 66,387-0 7,638-6 £ 20,518-8 7,270-0 19,4180 2,110-6 £ 50,059-4 17,603-7 6,8711 46,969-0 5,528-0 176,348-6 49,317-4 127,031-2 As with the preceding groups, we have next to ascertain the mileage averages of both classes of capital — the nominal and the actual. In Scotland the expansion of railway capital by nominal additions for financial reasons has been carried much further than in England. It appears to have been the headquarters of the stock spHtters and dupHcators. Their additions to cash capital averaged £13,300 for every mile 14 BRITISH RAILWAYS Scottish Lines, 1911. Nominal and Cash Capitals Reduced to Mn-KAGB Averages (3,695 Miles). Nominal Capital (OOO's) Per Mile. Cash Capital (OOO's) Per MUe. Caledonian Glasgow and South- Western Great North of Scotland . . Highland North British 70,578 24,874 7,638 6,871 66,387 65,800 63,400 23,000 14,100 60,000 £ 60,059-4 17,603-7 6,5280 6,8711 46,9690 £ 46,700 37,700 16,600 14,170 35,100 176,348 47,700 127,031-2 34,400 of line as against £10,500 per mile on the trunk lines and £11,000 per mile on the mineral lines. So far these calcu- lations have referred to line miles, but the more correct basis of single-track miles has now to be substituted. It furnishes the following averages : — Scottish Lines, 1911. Cash Capital pee Mile of Link and per Mile op Single Track. Cash Capital. (000-8) Miles of Line. Per Mile. Miles of Single Track. Per Mile. Caledonian Glasgow and South Western Great North of Scotland Highland North British .... £ 60,059 17,604 6,628 6,871 46,969 1,072 466 333 485 1,339 46,700 37,700 16,600 14,170 35,100 2,713 1,104 623 636 2,662 £ 18,460 15,940 10,670 10,800 17,700 127,031 3.695 34,400 7,628 16,650 These various eliminations and adjustments have brought us down at last to a comparatively reasonable level of actual cost. It is one on which we may take our stand and face comparison in this respect with the railways of most other countries. Undoubtedly there has been a great deal of unwise and unprofitable expenditure in the building up of every railway system — of which more hereafter — but it has been by no means so prodigal as is generally assumed, and when spread over a large mileage WHAT THEY HAVE COST 15 it shrinks rapidly in importance. In the Irish lines, which come next under review, there is little or no trace of it. Their capital is almost entirely free from duplication and nominal additions. The half-dozen lines which are to serve us as representative examples of Irish railway finance have, as will be seen below, an aggregate capital of 40J millions sterHng, and all the water to it is under a quarter of a million. Nominal and actual capital are so nearly ahke that it is hardly necessary to distinguish their respective mileage averages. Irish Likes, 1911. Nominal and Cash Capitals Reduced to Averages per Mile of Line. Nominal Capital. (OOO's) Per Mile of Line. Cash Capital. (OOO's) Per Mile of Line. Belfast and County Down . Dublin and South-Eastern . Great Northern of Ireland . Great Southern and Western Midland Great Western . . Midland (Irish Section)*. . 1,336-9 3,403-3 8,726-8 13,986-0 6,544-8 6,664-4 £ 16,700 21,110 15,560 12,500 12,100 25,300 £ 1,336-9 3,464-9 8,458-3 13,986-0 6,544-8 6,654-4 £ 16,700 21,500 15,000 12,500 12,100 25,300 40,652-2 14,800 40,445*3 14,800 Irish Lines, 1911. Their Cash Capitals per Mile of Line AND PER Mile of Single Track. Cash Capital (OOO's) MUes'of Line. Per Mile. MUes of Single Track. Per Mile. Belfast and County Down . Dublin and South-Eastern . Great Northern of Ireland . Great Southern and Western Midland Great Western . . Midland (Irish Section) * . 1,337 3,465 8,458 13,986 6,545 6,654 80 161 561 1,121 638 263 16,700 21,500 15,000 12,500 12,100 25,300 124 217 827 1,637 785 364 10,800 16,000 10,260 9,000 8,330 18,280 40,445 2,724 14,800 3,854 10,600 * The English Midland Railway. 16 BRITISH RAILWAYS The above five typical groups of British railways may now be brought into one general view in order to show their range of capitalisation, their various proportions of nominal and actual capital, and their average cost per mile of line and of single track. As a rule they differ widely in each of these respects. The only two groups that approximate as regards cost are the trunk and the mineral lines. These it will be seen are very similar in their average cost per mile both of line and of single track. (Trunk lines £63,100 per mile of line and £19,500 per mile of track and Mineral lines £63,500 and £21,100 respec- tively.) — Five Representative Groups of British Railways, 1911. Their Capitals Analysed. MUes. Cash Capital. Nominal Additions. Total Capital. Trunk Lines (9) ... Per mile of line . . . Per mile of single track . Southern Passenger Lines Per mile of line Per mile of single track . Mineral Lines Per mile of line . Per mile of single track . Scottish Lines .... Per mile of line . Per mile of single track . Irish Lines Per mile of line Per mile of single track . 12,533 33,700 £ 658,148,000 62,500 19,500 £ 132,767,000 10,500 4,000 £ 790,915,200 63,100 23,500 1,083 2,822 91,027,000 84,000 32,300 202,000* 91,229,000 84,000 32,300 795 2,291 41,628,000 52,360 18,200 8,830,000 11,100 3,800 50,458,000 63,000 22,000 3,695 7,628 127,031,200 34,400 16,650 49,317,400 13,300 • 6,500 176,348,600 47,700 23,150 2,724 3,854 40,445,300 14,800 10,550 206,900* 40,652,200 14,900 10,550 Written down. CHAPTER II WHY THEY HAVE COST SO MUCH The appearance of excessive cost from which the credit of British, railways has so long suffered is, we have seen, not altogether well grounded. By adopting proper methods of comparison with other railway systems it has been considerably reduced. Nevertheless, enough remains to justify to a certain extent the charge so often made against our railways of having been extravagantly built and financed. This charge does not lie so much against individual railways — though there is much more ground for it in some cases than in others — as against the system and the general policy which has characterised them from the outset. The specific causes of excess in capitalisation are varied as well as numerous. They have sprung from many different sources, and many different factors in the railway world are responsible for them. From the Imperial Parliament which sits in judgment on every railway bill down to the latest labour agitator, all who have had to do with our railways have helped consciously or otherwise to render them costly. Often as much has had to be spent on obtaining parliamentary powers as in less lawyer-ridden regions would build and equip a railway. Several years ago (1904) Mr. Acworth calcu- lated that the cost of preliminary surveys and parlia- mentary expenses had averaged £4,000 per mile on the then existing 22,000 miles of railway in the United Kingdom. At that rate nearly 90 millions sterling would have been swallowed up in preparatory work before a sod had been turned in actual construction. Road-bed, terminals and buildings Mr. Acworth c 17 18 BRITISH RAILWAYS estimated at 800 millions sterling, or £36,500 per mile, and rolling stock at 150 millions, or £7,000 per mile. In addition there had been a large expenditure on docks, steamboats, hotels and other midertakings outside of proper railway business. The rather melancholy con- clusion to which these figures lead us is that not more /^ than two-thirds of the capital expenditure on our railway system " went into the road," as the Americans say. And what did go in was not always well or wisely spent. In human affairs it would be more than any one could expect that hundreds of millions of money could be spent by an excited crowd of railway promoters without a good many mistakes, to say nothing of frauds and swindles. The railway pioneers of eighty years ago — say from y^ 1832 to 1846 — were boomers who had to pay boom prices for everything they bought. Their surveyors, their en- gineers, their solicitors, their parliamentary counsel had all to be highly feed. Every foot of land they needed had to be bought at penal prices. All the materials they used went steadily up in value as the demand for them increased. Everybody who had a chance to fleece them did it without compunction. They had always the convenient excuse that the railways fleeced them in return. The first generation of railway builders and users were continually recriminating thus on each other. The Royal Commission of 1865-6 had among its members the parent of the penny post, Sir Rowland Hill. He sympathised strongly with the railways and held that they had been very shabbily treated. In a Minority Report which he submitted he deplored the very poor financial results they had so far achieved, and thus enumerated some of the principal causes : — " Neither can it be said that railway proprietors have been consoled under their grievous disappointment by public gratitude, their services being little commended, while their failures are visited with severe animadversion and made the ground of a heavy penalty. It should not . .be forgotten that the very permission to construct a X^railway is bought at a high price, parliamentary expenses WHY THEY HAVE COST SO MUCH 19 being heavy, the demand for land and buildings often IS exorbitant. Agricultural land in Mr. Bidder's opinion is paid for on the average at four times its agricultural value. Again, while, in common with the owners of other public vehicles, railway companies are taxed by the State, their lines, unlike the old roads, are heavily rated by every parish they traverse, so that in some rural districts a railway company, though perhaps on the one hand reheving the parish of much pauperism by giving profitable employment to the peasantry, and on the other hand lightening the pressure on the rates by increasing the value of the property on which they are levied, is yet made to defray in a direct form half the parochial expenditure. In fine, railway companies have been made to feel in the severest manner that the justice which society observes towards individuals is seldom shown towards a corporation, a loss distributed amongst many being too often regarded as in effect no loss at all.*' Sir Rowland was not a believer in joint stock ownership of railways. He advocated a policy, which was then being applied to the Indian railways, of Government ownership combined with joint stock administration. He also favoured the Prussian system of dividing the country into railway districts, each district to have its own administration and rate schedules. Sir Edward Watkin and Mr. Allport, the then General Manager of the Midland, shared his views as to " districting," and quite recently they have found an echo among the railway authorities of to-day. On another point Sir Rowland Hill was an outspoken . /champion of the early railways. He maintained that l^many of their mistakes and the consequent losses were '^'due to bad law-making. In his separate report for the Select Committee of 1865-6 the following strong passage occurs : — . " That while railways have notoriously conferred enormous benefits on the public, at the same time greatly enhancing the value of the land and other fixed property, the general result to those whose capital and energy have produced this beneficial change has been unsatisfactory 20 BRITISH RAILWAYS and too often disastrous. Further, that with every allowance for bad management in the companies them- selves, much of this loss must be attributed to erroneous legislation." When this was written, nearly half a centur^^ ago, many flagrant examples of the bad effects of over legis- lation for railways had already come to light. The muddle produced at London Bridge by two distinct railways being tied up together in one terminal station was entirely due to the over caution of the Select Com- mittees who sat on the various schemes for lines to the south coast. The promoters of the Brighton Railway proposed to have their terminus where the Oval is now, but the Select Committee insisted on their coming up to London Bridge and sharing the station already estab- lished there by the Blackwall and the Dover lines. Not only so, but they had to make joint use of the Dover Company's rails all the way down to Redhill. Every one knows what a legacy of conflict and confusion this arbitrary arrangement produced. It must have cost the Brighton and South-Eastern companies millions each. The continual fear of the Parliamentary Committees who had the virtual planning of our railway system was that there would not be traffic enough to go round. Their first thought, when a new scheme came before them, was that it might not be able to earn decent divi- dends, and the poor shareholders might consequently be left in the lurch. In order to guard against such risks, neighbouring railways were required to work together as far as possible. Joint stations were always recom- mended in populous districts where sites were expensive. Joint ownership of urban lines was encouraged, as in the case of the Metropolitan and Great Western railways. Most of the trunk lines had to give each other running powers over their surburban sections. Twenty years ago it was a common thing to find a South Eastern train picking up stray passengers at Highgate or Enfield. Great Northern trains returned the com- pliment by wandering in some mysterious way on to the South-Eastern main line. Similar reciprocity was WHY THEY HAVE COST SO MUCH 21 practised by the Brighton Company with the Great Northern and the Midland. Running powers were exercised so freely in the metropolitan area that loco- motives were as frequently on foreign lines as on their own. All this, instead of being economical, as the Parliamentary Committees thought it would be, proved wasteful and obstructive. It has happily now been given up, but while it lasted it was a fine example of railway economies and reciprocities that went wrong. It must, however, be said for the Parliamentary Com- mittees that they were not the only short-sighted people who assisted at the birth of our British railways. The professional railway men were not much wider in their outlook than the political amateurs. Short-sightedness was an almost universal misfortune of the pioneer rail- ways, and no one would acknowledge that more readily than the railway managers of to-day, whose life is often a long struggle to make up for the omissions of years ago. Their heaviest and most costly work is dong things wliich could have been much easier and more cheaply done by predecessors long dead and forgotten. The truth is, that not one of our railway pioneers had the faintest conception of the ultimate possibilities of the new method of transportation. It only dawned on them gradually, and in looking back at lost opportunities. They regarded the steam road from a narrow^ point of view. It was the passenger business they coveted most. All the long-distance lines were specially designed for passenger traffic. Merchandise, minerals and live stock were after-thoughts. In order to provide for them the original plans had to be recast, additional rails to be laid, stations to be enlarged, and the way and works to be strengthened. Much of the early work had consequently to be done twice or three times over. Short-sightedness is a negative fault not to be too severely judged in a new industry of such tremendous magnitude as railway transportation. But there may have been others of a positive kind. The policy pursued by our railway managers may have tended to aggravate capital expenditure. It had for many years been their 22 BRITISH RAILWAYS proud boast that they never competed in rates, but only in "pubhc facilities." This is a very pretty phrase which sounds well and looks innocent, but it may cover any amount of foolish expenditure. A London manager. Sir J. C. Owen of the London and South-Western Railway, has given the following pithy summary of its effects in practice : — " Competition as to service takes the form of : — 1. An unnecessary number of trains. 2. The provision of expensive and luxurious rolling stock, more particularly as regards sleeping cars, for which in this country no adequate charge has ever been made. 3. An unnecessary acceleration of trains — (a) By the elimination of stops at non-competitive stations. (6) The costly process of making duplicate lines to cut across country with the sole object of reducing the through distance as compared with the competing line. (c) The construction of more powerful engines which of ten involves the relaying of the line with heavier material and the reconstruction of bridges. (d) The widening of existing lines with alteration of alignment, and the construction and manning of additional signal-boxes. Thus competition in " public facilities," or as it is sometimes called, " superiority of service," involves a large amount of capital expenditure as well as of revenue expenditure. The first three paragraphs in the above summary relate, it will be seen, to working expenses, but the last three, which are the most important of all, de- scribe how capital may be wasted on so-called improve- ments and accelerations. In one of the academic but interesting discussions on railway statistics which are provided at long intervals by the Royal Statistical Society the writer ventured to express what was then considered a very heretical opinion on this subject. Mr. C. L. Edwards, the chief accoun- WHY THEY HAVE COST SO MUCH 23 tant of the Great Northern Railway, had presented a very- strong plea for the railways, contrasting their great services to the community with the scant consideration which they received on all hands. The writer, in reply, pointed out that in one respect the community had treated the railways only too generously. It had always been too ready to lend them money for capital expenditure which often proved unprofitable. " In 1860," he said, " when the main lines of the country had been nearly all built, the average capital- isation was about £33,000 per mile. In 1906, when practically nothing had been added except feeders and the little spur lines which railway companies were so fond of running into each other, the average had been raised to £55,800 per mile. Twenty thousand pounds per mile had been added to the capitahsation of the main lines. How did that come about ? It was simply be- cause the railway companies had found it so easy to borrow money. Their largest expenditure of capital did not occur when they were building the greatest amount of new mileage; it always happened when they could borrow money cheaply. The expenditure was not so much on extensions as on so-called improvements. This evil, be believed, was largely due to the fallacy with which they started in early days, when their motto was that English railways did not compete in rates but in facilities. When he first began to study railway questions he always heard that the English railways were much more sensible than the American ones in religiously avoiding rate wars, but it now seemed to him that it might have been better for the shareholders to have competed in rates rather than in facilities. Our railway managers would then have had to rack their brains a little in order to conduct their traffic as cheaply as possible, whereas competing in facilities simply gave them a free hand to spend money.'* The law of diminishing return on new capital invested in railways can be traced back to an early period in their history. From 1873 onward it became very pronounced in its effects. In that year the aggregate capital expen- diture was £669,047,000, and the average return obtained 24 BRITISH RAILWAYS was 4-59, or practically 5 per cent. Li the succeeding fifteen years fresh capital expenditure was made to the amount of £276,375,000. If that money had been invested otherwise it might have earned at least 4 per cent., or £11,055,000 a year. But the actual increase in the net receipts of the railways was only £8,143,000. Some allowance may have to be made for nominal addi- tions to capital during the period, but the bulk of the new expenditure was in " improvements." *' Public facilities " and " universal providing " have been the special stumbling-blocks of the British railway manager. Instead of concentrating all his attention and his energy on his proper business — rapid and economical transportation — ^he has encumbered liimseK with acces- sories which were either unnecessary or better adapted for separate treatment. He has disdained the help of express companies for his parcel traffic, of Pullman com- panies for his sleeping and dining cars, and of private builders for his rolling stock. Latterly he has begun to take the station book-stalls and the advertising into his own hands. Such an omnivorous policy of course involves proportionate expenditure of capital. First-class American roads seldom encumber themselves with *' side shows." These are all farmed out to com- panies like the Pullman and the Adams express, which specialise in such undertakings. Neither is it the custom in America to have immense engine works and car-building shops. Most kinds of rolling stock can be bought cheaper from outside makers than they can be built on the premises. Not only is there a great saving in money by this means, but costly failure and needless anxieties are avoided. The head of the locomotive department stipulates for engines to do each particular class of work, and does not certify for them until he has satisfied himself that they can do it. Apart from their natural advantages of cheaper land, simpler permanent way and less costly terminals, the Americans have had the advantage of us in confining themselves to a much more limited range of service. This is one of the secrets of their much lighter capitahsa- WHY THEY HAVE COST SO MUCH 25 tion per mile. The extent of the saving would be difficult indeed to calculate. It has been, however, an important factor in keeping down the average cost per mile of American roads. With the Canadian roads it has been somewhat different. They follow the British practice, and aim at being universal providers for their passengers. But some of them have had other advantages which enabled them to keep down their capitalisation and show correspondingly larger returns on their stocks. The annual report of the Canadian Pacific Railway for 1911-12 has been issued while this chapter was being written. It shows gross earnings of $123,319,000 on a total capital of $440,000,000 (comm^on stock $180,000,000, debenture and preference stocks $260,000,000). This gives an average of 28 per cent, of gross earnings to total capital. The net was $44,402,000, or fully 10 per cent, on the whole 440 millions of stock and bonds. After de- ducting $10,525,000 for prior charges and $2,400,000 for preference dividends, there remained $31,477,000 for the $180,000,000 of common, equal to nearly 17 J per cent. Obviously this is not a proper comparison with our own railway results : it is rather a contrast. Its real object is to illustrate the vast variations that are pos- sible in the working conditions of railways in different countries, especially where they are in different stages of economic development. Canada at present is in a state of economic flux, while the United Kingdom has settled down into stereotyped grooves. The movements both of passengers and goods are proportionately much greater in the new country than in the old one. The Canadian Pacific has thus two immense advantages over any British and even over any European railway. One is a relatively low capitalisation, and the other is a large proportion of long-distance traffic. Its 10,500 miles of line,^ carrying 260 million dollars of bonds and preference stock and 180 miUion dollars of common stock, averages only $42,000, or £8,400 per mile, against the British £52,400 per mile. But here again the comparison is hardly on all fours. While the. 1 1911. 26 BRITISH RAILWAYS Canadian Pacific is, with the exception of its busiest sections, a single-track road, the English railway sys- tem is practically aU double, and much of it triple track. Its 16,200 miles of line represent fully 42,000 miles of single track, the average capitaHsation of which would be, instead of £52,400 only £22,500 per mile. Per contra, the Canadian Pacific had in 1911 only 553 miles of double track. Reduced to single track its total mileage was 11,034 miles, and on this — the true basis — its average capitaHsation would be $40,000, or £8,000 per mile against an English average of £22,500 per mile. Even so, $40,000 per mile does not represent anjrthing like the real amount of money that has gone mto the Canadian Pacific. The Canadian Government had built 600 or 700 miles of it before the company took it over, and the company not only got that as a free gift, but had a money subsidy of twenty-five million dollars as well. Moreover, for the first ten or fifteen years of its operation large amounts of current revenue had to be capitalised instead of being distributed in dividends. If a complete account could be made up of the money that went into the Canadian Pacific from special sources, quite apart from the shareholders, it would probably increase the existing ordinary capital by one-fourth. Its true average may be about $50,000 per mile as com- pared with the English £22,500 per mile of single track. The same amount of revenue would therefore go fully twice as far on the Canadian Pacific capital as on the English. This remark will apply also to many of the United States roads which show large percentages of gross and net revenue on comparatively small capitals. Even the Union Pacific, though it is no longer very lightly capitaHsed, its average being $70,000 per mile, might in two recent years have paid 20 per cent, divi- dends. Its surplus available for the common stock ranged lately from 19*1 per cent, down to 13*8 per cent. Broadly put, British railways have had to pay top prices for their charters, their land, their materials, and nearly everything that has gone into them, whereas American and Canadian lines have had the advantage WHY THEY HAVE COST SO MUCH 27 of free charters, cheap land and cheap building. In addition they obtained large subsidies from public au- thorities which do not appear in their capital accounts. At the outset they were much more roughly built than the typical British railway. They had to spend much less money on stations, fencing and bridges. American engineering is altogether of a plainer and more severely practical sort than British. There is nothing in it of what American engineers contemptuously call filagree work. The most curious contrast between the two systems arises out of their widely different methods of finance. Reorganisations and reconstructions have been common to both, but they have been carried out on opposite lines. " Scaling down " stocks has been a favourite American practice, and a countless amount of capital has been wiped out in that way. On the other hand, British manipulation of stocks has generally taken the form of nominal additions to them, as explained in the preceding chapter. While these have tended to exaggerate the capitalisation of British railways, American " scaling down " has had the reverse effect. Hence average cost per mile is no longer an equitable basis of comparison. CHAPTER III THE WORK THEY DO The highest and most conclusive test of the efficiency of a railway system is the value of the work it does for the community. This should take precedence of all questions of dividends, wages and labour conditions. Even the burning question of nationalisation should be subordinate to it. A railway in private hands may be a national boon ; there are, in fact, many such examples. On the other hand, a state-owned and managed railway may be a national evil. Everything depends on the railway itself and the character of its work. If it ably and honestly serves the district it occupies it will be not only a great public convenience, but a source of prosperity and an incentive to progress of all kinds. One of the best possible illustrations of this economic truth is to be found in the history of British railways. The contrast between the England of to-day and the England of eighty years ago is to a large extent their doing. If they had never paid a dividend to their proprietors they would still have been a good investment for the country. In order to realise this one has only to glance at the official records of the work they do, and which but for them could never have been done. A few details of the goods and passenger movements of 1911 will probably amaze the reader. In that year 1,325 millions of passengers, 113| million tons of merchandise and 407f miUion tons of minerals were carried on the railways of the United Kingdom. The passenger trains ran an aggregate distance of 270 million miles, and the goods trains an aggregate of 156^ million miles. Passenger earnings amounted to 38 millions 28 THE WORK THEY BO 29 sterling plus nearly 6 millions for parcels, mails excess, luggage, etc. The total revenue of the passenger trains was therefore about 44 millions sterling. The cost to the community of a passenger service consisting of thousands of trains per day and covering the whole kingdom from Thurso to Bantry Bay is less than a pound per head per annum. There has been more new taxation levied in the past half-dozen years than would provide free railway travelling for the whole forty-five millions of our population. But vast as that service is, it is not the greatest that our railways have rendered to us. The 400 million tons of minerals they carry every year are the basis of our national industries and our domestic comforts. Without them there could be no gigantic ship-yards on the Clyde and no huge factories in Lancashire and Yorkshire. London itself would be an impossibility, though that is perhaps a not wholly regrettable alternative. For every man, woman and child in the United Kingdom 9 tons of minerals and 2J tons of merchandise have to be trans- ported annually by rail. That means employment for millions who would otherwise have had to emigrate or starve. ^©Wherever railways are most active and enterprising there we find the greatest prosperity and the best con- ditions of human life. Conversely, sleepy railways are a sure sign of stagnant communities. Compare the Canadian North-West with the Province of Quebec, or the railway areas of China with the still undeveloped provinces, if you would estimate the wealth-creating power of the locomotive. On a smaller scale we can see it in the commercial relations of the three kingdoms. Their respective degrees of economic progress are most correctly indicated by their railway operations. England and Wales have 80 per cent, of the population, Scotland 10 J per cent., and Ireland 9 J per cent., but railway business is very differently distributed among them. Of the 1,325 milhons of passengers carried in 1911, England and Wales had 90 per cent., while Scotland had only 8 per cent., and Ireland barely 2 J per cent. In the 30 BRITISH RAILWAYS tonnage of merchandise moved, Scotland made a better show and Ireland a worse one than in passenger traffic. The respective percentages in this case were — England and Wales 84, Scotland 12 J, Ireland 3 J. In passenger business England was 10 per cent, above its proportion of the population; Scotland 2 per cent, under it, and Ireland 7^ per cent, under. On the other hand, in merchandise traffic Scotland was 2 per cent, above its population level, and England, instead of being 10 per cent, above hers, was only 4 per cent., while Ireland was 6 per cent, under hers. But it is the mineral traffic that brings out the most remarkable diversity between the three branches of the United Kingdom. Here Ireland is practically nowhere. Her contribution of 2J million tons to an aggregate of 407| million tons is microscopic, — little more than one-half of one per cent. Scotland's 64 J million tons form a respectable quota equal to 13 J per cent. The lion's share, which falls to England and Wales, is 350| out of 407| million tons, equal to 86 per cent, of the whole. These figures and percentages shed a flood of light on two anomalies in our railway system — first, the pre- dominance of the mineral traffic, and secondly, the great disadvantage under which the Irish railways labour in this respect. Coal, iron and their products are un- doubtedly the mainstay of British railways. The pre- historic railway director who, when it was proposed to carry coal, exclaimed, " What next ! They will be asking us to carry manure by and by," would have had a fit at the sight of a 1300-ton coal train on the North-Eastern railway. A good many of his successors might have fits if the 1300-ton coal trains were to disappear. As for Ireland, if she is severely handicapped by lack of coal, she has a valuable compensation in the abundance of her peat. For the poor it is on the whole better to have fuel at their own doors to which they can help themselves than down in the bowels of the earth which when raised they have to buy by the hundredweight at THE WORK THEY DO 31 the rate of 305. per ton, as millions of Londoners must do every winter. The respective amomits which the three kingdoms pay for their railway service is another instructive question. England and Wales contributed fully 38 millions of the 44 millions spent on passenger fares in 1911. That was a shade less than 86 J per cent, of the whole. Scotland's share was 4J millions, or nearly 9 J per cent., which exactly coincided with her propor- tion of the population. Ireland's £1,717,000 made up the remaining 4 per cent. Thus, notwithstanding the vigorous efforts of the railway companies, both British and Irish, to develop tourist traffic in Ireland, there is still a good deal of leeway to make up in passenger receipts. The railway operations of the three kingdoms and their respective results may be most clearly illustrated by a few condensed tables. Li the first (Table A) the passenger traffic is analysed so as to show (a) the total number of passengers carried in 1911, (6) the total number of train miles run, and (c) the average number of passen- gers per train mile. British Railways, 1911. A. — Passengers Gross and per Train Mile. 1 Passengers. (OOO's) Train Miles. (OOO's) Passengers per Train Mile. England and Wales : Steam . Electric Scotland Ireland 814,851 373,353 107,298 30,815 209,297 20,261 28,972 11,746 40 13-4 3-7 2-6 1,326,317 270,276 4-9 Table B presents a corresponding analysis of passenger earnings in the three kingdoms : (a) total number of passengers carried in 1911; (6) total revenue from same; (c) average fare per passenger, and (d) average earnings per train mile run. 32 BRITISH RAILWAYS B. — Passenger Revenue per Train Mile, rassenc?er3. (OOO's) Revenue. (OOO's). Average per Passenger. Earnings per Train Mile. England and Wales : Steam . Electric Scotland Ireland 814,851 373,353 107,298 30,815 £ 43,332\ 2,976j 5,362 2,284 «. d. 9-3 1 1 6 8. d. 4 3 8 3 11 1,326,317 53,954 9-8 4 Table C gives a comparative view of the mineral and merchandise tonnage of 1911 in the three kingdoms, and shows also the total number of train miles run in each of them. C. — ^Mineral and Merchandise Tonnage. Minerals. [Merchandise.! Total Tons. Train Miles. (OOO's) 1 (OOO's) 1 (OOO's) i (OOO's) England and Wales . Scotland Ireland Tons. Tons. 352,6.50 95,641 54,850 13,819 2,312 4,305 Tons. 448,291 68,669 6,617 130,867 20,276 5,357 409,812 1 113,765 523,577 1 156,500 The gross receipts from minerals, merchandise and live stock in each of the three kingdoms will be next seen in Table D. T>. — Mineral and Merchandise Revenue. Minerals. (OOO's) Merchandise. (OOO's) Live Stock. (OOO's) Total. (OOO's) England a-id Wales . Scotland Ireland £ 25,974 3,465 306 £ 27,042 3,564 1,469 £ 906 252 307 £ 53,922 7,281 2,082 29,745 i 32,075 1,465 63,285 Such huge amounts may not have much meaning for the general reader who will doubtless prefer them reduced to mileage averages. These are of two kinds — first, averages per mile of track, and secondly, averages per train mile run. Judged by this test the amount of work done THE WORK THEY DO 33 sounds disappointingly small compared with the tremen- dous organisation employed in doing it. That the rail- way trains of the United Kingdom should carry on an average only 3 J tons for every mile they run would be a startling announcement to make at a meeting of railway shareholders, but here are the official figures by which any one may check the calculations for himself : — E. — Train Mileage op Merchandise and Minerals. Total Train Miles. (OOO's) Tons per Train Mile. Tons per Mile of Track. England and Wales . Scotland Ireland 130,867 20,276 5,357 3-40 3-39 1-23 10,620 8,840 1,440 156,600 3-34 9,600 The comparatively small average quantity carried per train mile is matched by the comparatively small average amount earned. For England and Wales it is Ss. 3d. per train mile, for Scotland 75. 2d., for Ireland Is. 9d., and for the United Kingdom 85. Id. But poor as they look, these averages are handsome beside the passenger earnings per train mile. They were in 1911 45. for England and Wales, 35. Sd. for Scotland, 35. Ud. for Ireland, and 45. for the United Kingdom. Why should passenger trains earn less than half as much per train mile as goods trains do ? Is the cause low fares, excessive mileage, or what ? Will some railway manager kindly explain ? F. — Goods and Minerals. Average Receipts per Mile of Track AND PER Train Mile. Total Receipts. (OOO's) Average per Mile of Track. Average per Train Mile. Passenger Average per Train Mile. England and Wales . . . Scotland Ireland £ 53,922 7,281 2,082 £ 1,280 938 450 8. d. 8 3 7 2 7 9 8. d. 4 3 8 3 11 63,285 1,160 8 1 4 The analysis shown in the foregoing tables could be 34 BRITISH RAILWAYS carried to an almost unlimited extent. Every individual railway company might have its operating accounts thus dissected, but here we must limit ourselves to the five representative groups already selected for special investigation — ^the trunk lines, southern passenger lines, mineral Hnes, Scottish and Irish. The first group com- prises, it will be remembered, nine of the principal English railways — ^the Great Central, Great Eastern, Great Northern, Great Western, Lancashire and York- shire, London and North- Western, London and South- western, Midland and North-Eastern. This group, though only nine in number, and conse- quently a mere fraction numerically of the two hundred and fifty railway companies in the United Kingdom, com- mands 58 per cent, of the aggregate capital and 62 per cent, of the total mileage. It carries 40 per cent, of the total number of passengers and 63 per cent, of the merchandise and minerals. We may therefore expect to find in it the finest examples of British railway adminis- tration, the most up-to-date methods of working, and the best financial results both for traders and shareholders. Beginning with a bird's-eye view of the operations of the trunk line group, the succeeding tables will analyse and compare the various branches of traffic — passenger, merchandise and mineral. They will also show the averages per mile of track and per train mile. Trunk Lines, 1911. A. — A Bibd's-Eyb View of their Operations. Mileage of Single Track. Earnings. (OOO's) Ooods Earnings. (OOO's) Great Central Great Eastern Great Northern .... Great Western Lancashire and Yorkshire London and North- Western . London and South -Western . Midland North-Eastern . . . . 2,252 2,640 2,656 6,645 2,194 5,602 2,218 4,862 4,842 £ 1,4180 3,156-0 2,420-0 6,801-0 2,591-0 6,831-0 3,502-0 4,158-0 3,386-0 £ 3,348-4 2,646-2 3,347-9 7,289-3 3,495-3 9,075-2 1,601-6 8,681-3 6,960-2 3,3700 34,263-0 46,436-4 THE WORK THEY DO 35 B. — Average Number of Passengers per Mile of Track AND PER Train Mile. Passengers. (OOO's) Train Miles. (OOO's) Number per Mile of Track Number per Train Mile. Great Central Great Eastern .... Great Northern .... Great Western .... Lancashire and Yorkshire London and North- Western . London and South-Western . Midland North-Eastern .... 25,015-6 98,329-8 36,670-6 102,523-2 68,965-8 74,552-4 68,701-2 50,639-6 60,973-2 8,790-1 14,029-6 13,054-0 32,760-5 12,705-3 30,705-2 15,649-6 22,441-5 17,418-5 11,100 38,700 13,400 15,400 27,000 13,500 30,970 10,410 12,600 2-8 7-0 2-7 3-1 4-6 2-4 4-4 2-3 3-5 675,261-4 167,554-3 17,000 3-4 C. — Passenger Receipts. Averages per Mile op Track, per Train Mile and per Passenger. Passenger Receipts. (OOO's) Per Mile of Track. Per Train Mile. Per Passenger. Great Central . . . Great Eastern .... Great Northern . . . Great Western . . . Lancashire and Yorkshire London and North- Western London and South-Western Midland North-Eastern . . . 1,418.0 3,156-0 2,420-0 6,801-0 2,591-0 6,831-0 3,502-0 4,158-0 3,3860 £ 630 1,240 910 1,023 1,180 1,230 1,580 860 700 t. d. 3 3 4 6 3 8 4 2 4 4 6 4 6 3 9 3 10 «. d. 1 li ?I* 1 4 m 1 10 1 1 8 1 1 D. — Tonnage of Merchandise and Minerals. Miles of Single Track. Tons of Mer- chandise. (OOO's) Tons of Minerals. (OOO's) Total Tonaage. (OOO's) Great Central .... Great Eastern .... Great Northern .... Great Western .... Lancashire and Yorkshire . London and North -Western. London and South-Western. Midland North-Eastern .... 2,262 2,640 2,655 6,645 2,194 6,502 2,218 4,862 4,842 6,424*9 6,067-0 5,363-5 9,030-8 7,462-2 11,020-6 2,682-0 9,481'0 15,346-8 29,462-6 7,366-1 16,557-7 44,927-2 18,930-4 43,679-8 4,341-8 41,780-6 51,064-5 35,887-5 13,433-1 21,921-2 53,958-0 26,392-6 54,700-4 7,023-8 51,261-6 66,411-3 33,700 72,878-8 268,110-6 330,989-4 36 BRITISH RAILWAYS E. — Average Tonnage per Train Mile and per Mile op Track. Total Tonnage. (OOO's) Train MUes. (OOO's) Tons per Train Mile. Tons per Mile of Track. Great Central .... Great Eastern Great Northern .... Great Western .... Lancashire and Yorkshire London and North- Western . London and South- Western . Midland North- Eastern .... 35,887-5 13,433-1 21,921-2 53,958-0 26,392-6 54,700-4 7,023-8 51,261-5 66,411-3 8,443-7 8,306-8 10,107-9 20,146-8 5,096-3 17,467-4 4,429-9 26,394-9 11,386-5 4,250 1,617 2,169 2,680 5,180 3,130 1,585 1,940 5,830 16,000 5,310 8,260 8,120 12,030 9,940 3,170 10,570 13,720 330,989-4 111,780-2 2,960 9,820 Next we have a representative group of mineral lines, nine in number, like the trunk line group, but operating on a much smaller scale. Mineral Lines, 1911. F. — Average Number of Passengers per Mile op Track and PER Train Mile. Passengers (OOO's) Train Miles (OOO's) Number per Mile of Track. Number per Train Mile. Barry .... Brecon and Merthyr Cardiff . . . Furness Hull and Barnsley North Staffordshire Neath and Brecon Rhymney TaffVale . . . 2,722-1 1,014-7 146-6 2,973-7 567-9 7,001-3 441-6 3,7221 8,368-0 586-6 268-2 72-5 738-4 436-8 1,444-8 52-5 407-3 1,079-8 9,485 9,500 1,130 8,000 1,920 1,400 820 23,000 21,600 4-6 3-8 2-0 4-0 1-3 4-8 8-4 91 7-8 26,957-9 5,086-9 11,770 5-3 G. — Merchandise AND Mineral Tonnage Compared. Merchandise. Tons. (OOO's) Mineral. Tons. (OOO's) Total Tonnage. (OOO's) Barry 644-6 160-9 1,2120 609-5 827-2 1,717-0 67-8 251-4 880-8 9,430-0 3,127-7 1,674-7 3,378-8 3,9731 5,687-1 1,360-1 9,822-6 17,661-2 10,074-6 3,288-6 2,886-7 3,988-3 4,800-3 7,404-1 1,427-9 10,074-0 18,642-0 Brecon and Merthyr . Cardiff Furness .... Hull and Barnsley North Staffordshire . Neath and Brecon . Rhymney .... TaffVale .... 6,371-2 56,116-3 62,486-5 THE WORK THEY DO 37 H. — AvBRAGB Tonnage per Tbain Mile and per Mile of Track. Total Tons (OOO's) Train Miles. Tons per Train Mile. Tons per Mile of Track. Barry ....,- 10,074-6 3,288-6 2,886-7 3,988-3 4,800-3 7,404-1 1,427-9 10,0740 18,542-0 1,088-8 320-0 652-8 627-5 1,611-4 1,165-6 88-9 1,364-8 1,554-6 9,250 10,280 4,420 6,350 2,980 6,350 1,600 7,380 1,190 35,110 30,750 22,380 10,800 16,270 14,780 26,450 62,180 48,000 Brecon and Merthyr Cardiff .... Furness Hull and Barnsley North Staffordshire Neath and Brecon Rhymney . TaffVale . . . 62,486-5 8,474-4 7,370 27,280 The Scottish group embraces four lines, two large and two small ones, with a moderate one between. The averages per mile of track and per train mile are worked out below uniformly with those of the trunk and the mineral groups. In the Irish group we have half-a-dozen railways, but three of them are partly English. One of the principal lines in Ulster is now known as the Irish section of the Midland Railway. The Dublin and South-Eastern is closely affiliated with the London and North- Western, while the Great Southern and Western works in close aUiance with the English Great Western. The effects of these Anglo-Irish combinations are more apparent in the passenger than in the goods traffic of the Irish lines. The following three tables exhibit, first, the aggre- gate passenger and goods movements, and secondly, the averages per mile of track and per train mile. 38 BRITISH RAILWAYS The Scottish Group. -Average Number of Passengers per Mile of Track and PER Train Mile. Passengers. (OOO's) Train Miles. (OOO's) Number per Mile of Track. Number TraffMile. Caledonian Glasgow and South-Western Great North of Scotland . Highland North British .... 33,233-8 16,741-1 3,351-9 2,128-7 35,676-5 10,092-9 4,568-3 1,518-4 1,750-4 9,496-5 12,250 15,100 6,410 3,340 13,450 3-3 3-7 2-2 1-2 3-7 91,1320 27,426-5 11,960 3-3 K. — Merchandise and Mineral Tonnage. Merchandise. 000 tons. Minerals. 000 tons. Total tonnage. (OOO's) Caledonian Glasgow and South-Western Great North of Scotland . . Highland North British 5,612-6 1,836-7 444-8 279-8 5,5750 21,700-9 7,106-9 563-3 328-4 24,991-4 27,313-5 8,943-6 1,008-1 608-2 30,566-4 13,748-9 54,690-9 68,439-8 L. — Average Tonnage per Mile of Track and per Train Mile. Total Tonnage. (OOO's) Total Train Miles. (OOO's) Average per Mile of Track. Average per Train MUe. Caledonian Glasgow and South-Western . Great North of Scotland . . Highland North British 27,313-5 8,943-6 1,008-1 608-2 30,566-4 6,665-2 2,835-1 670-5 1,043-9 8,911-7 10,000 8,100 1,930 950 11,520 4-1 3-1 1-5 0-6 3-4 68,439-8 20,126-4 8,970 3-4 THE WORK THEY DO 39 The Irish Group. M. — Average Number of Passengers per mile op Track and per Train Mile. Passengers. (OOO's) Train Miles. (OOO's) Number per Mile of Track. Number per Train Mile. Belfast and County Down Dublin and South- Eastern . Great Northern of Ireland . Great Southern and Western Midland Great Western . . Midland (Irish Section) 3,196-0 5,036-8 6,997-6 6,073-2 1,754-8 3,669-3 714-3 994-6 2,841-7 3,735-3 1,6021 1,298-2 25,800 23,200 8,460 3,950 2,230 10,000 4-5 50 2-4 1-6 1-1 2-8 26,726-6 11,186-1 6,940 2-4 N. — Merchandise and Mineral Tonnage Combined. Goods. (OOO's) Minerals. (OOO's) Total Tonnage (OOO's) Belfast and County Down . Dublin and South- Eastern . Great Northern of Ireland . Great Southern and Western Midland Great Western . . Midland (Irish section) . 145-4 211-8 1,008-7 1,415-4 635-4 486-7 140-6 130-7 686-3 627-2 133-2 414-7 285-9 342-5 1,595-0 2,042-6 668-6 901-4 3,803-4 2,032-6 5,836-0 O. — Ayxbaob Tonnage per Mile op Track and per Train Mile. Total Total Average Average Tonnage. Train Miles. per Mile per (OOO's) (OOO's) of Track. Train MUe. Belfast and Ck)unty Down . 285-9 87-8 2,300 3-25 DubUn and South- Eastern . 342-5 270-6 1,580 1-27 Great Northern of Ireland . 1,595-0 1,221-0 1,930 1-3 Great Southern and Western 2,042-6 2,143-1 1,330 0-95 Midland Great Western . . 668-6 928-1 850 0-72 Midland (Irish Section) 901-4 488-2 2,480 1-8 5,8360 5,138-8 1,500 1-1 CHAPTER IV THEIR GROSS AND NET REVENUES The most practical answer to the question whether or not a railway is reasonably and safely capitalised is the return it makes on its capital expenditure. This inquiry divides itself into two stages. First we have to compare the gross annual receipts, and next the net receipts, with the capital on which interest and dividends have to be paid. On this line a series of interesting and valuable comparisons may be made, beginning with the railway systems of the three kingdoms, and proceeding through the various representative groups that were treated of in the previous chapter — ^the trunk lines, passenger lines, mineral, Scottish and Irish. The 16,200 miles of railway in England and Wales showed in 1911 gross earnings of £109,910,000^ and net £40,937,000. Their net capital, after the elimination of all paper stock and other nominal additions, was £944,700,000. On this the gross earnings represented a return of 11| per cent., and the net 4*3 per cent. The 3,815 miles of Scottish railways, with a cash capitalisation of £136,500,000, earned in the same year £13,498,000 gross and £5,947,000 net, being 10 per cent, and 44 per cent, respectively. The 3,402 miles of Irish railways, capitalised at £43,600,000, earned £4,511,000, or 10*3 per cent, gross and 3*9 per cent. net. The totals for the United Kingdom were therefore £1,124,816,000 of cash capital, £127,199,000 of gross earnings, and £48,581,000 net, equal to 11*3 per cent, and 43 per cent, respectively. ^ Including electric railways. 49 THEIR GROSS AND NET REVENUES 41 British Railways, 1911. Gross and Net Earnings compared with Capital. Net Capital. (OOO's) Gross Earnings. (OOO's) Per- Icentage of Capital. Net Earnings. Per Cent, of Net England and Wales Scotland .... Ireland £ 944,764 136,461 43,591 £ 109,190 13,498 4,511 11-5 10-0 10-3 £ 40,937 5,947 1,697 4-3 4-4 3-9 1,124,816 127,199 11-3 48,581 4-3 The most noticeable feature in these averages is their unexpected uniformity. The last thing to be looked for in them was that the much-disparaged Irish railways should be yielding almost as good returns on their original cost as either the English or the Scottish lines. Of course they are much inferior lines both as regards construction and traffic. They cost much less to build than the English and Scottish lines did, and their traffics are much lighter, but their earning power in proportion to their capitalisation is not a great deal less. Our railway builders are entitled to some credit for this uniformity of return on capital cost. It shows that they worked on some general principle, and studied local conditions as well as the actual requirements of the traffic. In their preliminary estimates they seldom over-rated the prospect- ive traffic. They were more liable to err on the short side. But the three systems — ^the English, Scottish and Irish — are surprisingly alike in their financial results. Next to this uniformity of return on capital outlay as between the three kingdoms, the most striking feature is the contrast it offers to some foreign and colonial returns of a corresponding class. When we read of Canadian and American railways earning as much as 10, 15 and even 20 per cent, on their ordinary stock, it shows us how widely the methods and conditions of rail- way transport may differ in various countries. Such an anomaly is surely worth investigating, and it is strange that British railway experts should have given it so little attention. For their own professional credit it might have 42 BRITISH RAILWAYS been thought our railway admmistrators would have attempted an explanation of the puzzle. Can it be that they, in common with railway shareholders, traders and press critics, have failed to perceive the great importance of capitahsation as a factor in railway results ? Did they not discover until it was too late that by not sticking to their proper work as railway carriers they have over- loaded themselves with extraneous duties, and overloaded their capital accounts with extraneous expenditure ? The typical American railway receives goods at one station and conveys them to another station. It simply provides the wagons and does the hauling. It neither collects nor delivers. It has no parcel service — all that is turned over to the Express companies. It seldom runs a hotel or a line of steamers, though it frequently has its own shipping wharfs. Its capital account rarely includes more than the actual cost of the road and roUing stock. It is not, as in England, loaded down with out- lays on outside services or " side shows." MiUions of our railway capital have been sunk in a collection and dehvery outfit which often contrives to be both expensive and unprofitable. Other millions are locked up in a parcel service which specially organised companies might have done much better. Still more miUions have disappeared in the hotel, dining-car and sleeping-car business. It is in England rather than in Scotland or Ireland that railway enterprise is most promiscuous, and more fre- quently overflows its proper channel. About 8 J per cent, of the gross earnings of the English and Welsh fines is extraneous income. The aggregate receipts of the 16,060 miles of steam railway were £105,887,000, but they included £6,046,000 derived from steamers, canals and docks, as well as £3,696,000 of miscellaneous income from rents, tolls, hotels, etc. In order to ascertain the railwa}^ receipts proper, these two items, amounting together to £8,741,000, have to be deducted from the above total of £106,887,000. The traffic receipts of the 16,060 miles of railway will be thereby reduced to £97,146,000. To that, however, there is a large set-off on the expendi- ture side. The outside undertakings cost very nearly as much to maintain as they bring in. In 1911 the THEIR GROSS AND NET REVENUES 43 working expenses of the steamers, docks, canals, etc., amounted to £4,110,000, in addition to which there was £1,852,000 of miscellaneous outlay. The total cost of auxiliary services was £5,962,000, or close on six milUons sterling. Assuming these to have been all bona fide trading operations, the excess of revenue over income would be £2,779,000. That looks at first sight like a good profit, but it represents, in fact, a very poor return on the huge amount of capital employed in earning it. One of the most successful railway ports in England was admitted a few years ago to be returning only 2 per cent, on its capital outlay. If that be all that the best of them can do, the worst must be poor investments. More than one still falls short of its working expenses. As it is desirable here to concentrate attention on railway traffic pure and simple, these outside revenues and expenditures will have to be distinguished from the railway accounts proper. In future that distinction will be much easier to make than it is at present, as under the Railway Accounts and Returns Act, which came into operation on the 1st January, 1913, the companies will have to furnish separate accounts for their trading ventures — steamers, docks, hotels, etc. Even now the principal facts concerning them can be obtaiued by wading through the annual reports of the Board of Trade, By a laborious analysis of existing data it is possible to give the reader a general idea of these much-discussed trading operations, and also to foreshadow the nature of the additional information which the companies will have to supply hereafter. The group of trunk lines which do three-fifths of the railway work of the United Kingdom will be the most suitable subjects to use in illustrating the tendency of our railway service to become needlessly and even wastefuUy complex. The up-to-date manager competes with the department stores as a "universal provider." He is always discovering or inventing something which no well-equipped railway can do without. Some companies are more fortunate with their " universal providing " than others, but it will be seen that it does not contribute much to any of their dividends. 44 BRITISH RAILWAYS The following series of tables are intended to present in separate form and consecutive order abstracts of the various classes of railway revenue and expenditure which in the official accounts are all mixed up together. The first table shows the earnings of the passenger and goods services, which form the railway revenue proper. The second combines with these the results of the trading operations, and thereby arrives at the gross revenues of the various lines. The third summarises the receipts, ex- penses and net revenues of the railway department proper. The fourth does the same for the trading accounts. The fifth and last gives the averages per mile of the railway gross receipts, working expenses and net revenue for each of the nine trunk lines. This differs from the usual averages based on the whole earnings and expenses of the railways, which are worse than useless for purposes of comparison, especially international comparisons. On one side we eliminate the trading receipts, and on the other the trading expenses, leaving only the railway results proper. Another im- portant adjustment is the use of single-track mileage instead of miles of line. This remedies in some degree the anomaly of treating all railways aHke, whether they have one, two, three or four tracks. Trunk Lines, 1911. A. — Their Traffic Receipts Classified (Railway Traffic Proper). Mer- chandise. (OOO's) Live Stock. (OOO's) Minerals. (OOO's) Total Goods. (OOO's) Great Central .... £ 1,2910 1,567-3 1,678-0 3,510-2 2,083-7 5,278-3 1,065-7 3,680-2 3,332-4 £ 24-7 85-9 46-4 168-2 411 197-1 45-7 102-3 106-4 2,032-7 993-0 1,624-5 3,621-0 1,370-4 3,699-8 490-1 4.898-7 3,611-4 3,348-4 2,646-2 3,347-9 7,289-4 3,495-2 90,875-2 1,601-5 8,681-2 6,950-2 Great Eastern .... Great Northern Great Western Lancashire and Yorkshire London and North- Western London and South- Western Midland North- Eastern 23,486-8 806-8 22,141-6 46,435-2 THEIR GROSS AND NET REVENUES 45 B.— Railway Receipts Proper and Trading Receipts Combined. Total Goods. Passengers. Trading Receipts. Gross Revenue. Great Central .... Great Eastern .... Great Northern Great Western . . . Lancashire and Yorkshire London and North-Western London and South-Western Midland £ 3,348-4 2,646-2 3,347-9 7,289-3 3,495-3 9,076-2 1,601-6 8,681-3 6,960-2 £ 1,417-7 3,156-2 2,420-4 6,801-1 2,591-0 6,831-1 3,502-0 4,158-5 3,386-3 £ 509-5 701-9 301-7 522-8 647-0 542-3 666-6 969-5 425-5 £ 6,275-6 6,504-3 6,070-0 14,613-2 6,733-3 16,448-7 5,770-2 13,809-3 10,762-0 North-Eastern . . . 46,436-4 34,264-3 5,286-8 86,986-6 C. — Their Railway Receipts, Expenses and Net Revenue. Gross Receipts. Expenses. (OOO's) i (OOO's) Net Revenue. (OOO's) Great Central Great Eastern Great Northern .... Great Western .... Lancashire and Yorkshire . London and North-Western . London and South-Western . Midland North-Eastern . . . . 4,766-1 6,802-4 5,768-4 14,090-4 6,086-3 16,906-3 5,103-6 12,839-9 10,336-5 £ 3,076-6 3,653-7 3,696-4 8,674-3 3,600-3 9.994-9 3,140-8 7,892-2 6,396-3 £ 1,689-6 2,148-7 2,0720 6,4161 2,486-0 5,911-4 1,962-8 4,947-7 3,940-2 80,699-9 50,125-4 30,574-5 D. — Their Trading Receipts — Expenses and Net Revenue. Receipts. Expenses. Net Revenue. Great Central .... Great Eastern .... Great Northern Great Western . . . Lancashire and Yorkshire London and North-Western London and South-Western Midland £ 609,602 701,922 301,263 622,785 642,033 542,351 766,571 969,643 425,555 £ 371,022 513,581 196,730 625,175 629,626 314,700 641,690 773,006 406,444 £ 138,480 188,341 104,533 2,390* 112,408 227,651 224,881 196,537 19,111 North-Eastern 6,381,625 4,171,973 1,209,562 ♦ Loss. 46 BRITISH RAILWAYS E. — Their Railway Receipts, Expenses and Net Revenue PER Mile (Single Track). Miles. Railway Receipts. (OOO's) Expenses. (OOO's) Net Revenue (000*8) Great Central .... Great Eastern .... Great Northern Great Western Lancashire and Yorkshire London and North -Western London and South-Western Midland North-Eastern 2,252 2,540 2,655 6,645 2,194 5,502 2,218 4,942 4,852 £ 2,116 2,284 2,172 2,120 2,774 2,890 2,300 2,600 2,130 £ 1,367 1,438 1,392 1,305 1,641 1,816 1,416 1,600 1,320 £ 749 846 780 815 1,133 1,074 884 1,000 818 33,700 2,396 1.487 908 By tabulating on the same principle the railway and trading operations of the mineral group of lines we obtain the three following tables : — Mineral Grotjp, 1911. -TnEiR Railway Receipts Proper. Mer- chandise. Live Stock. Minerals. Total Goods. Barry Brecon and Merthyr . . . Cardiff Furness Hull and Barnsley , . . North Staffordshire . . . Rhymney TaffVale £ 41,524 17,689 24,003 121,022 203,636 302,546 31,862 86,583 568 1,641 7 3,602 1,286 5,072 133 1,149 £ 261,581 67,349 27,397 220,679 339,894 302,381 254,592 562,692 £ 303,673 86,679 51,407 345,203 544,815 609,999 286,587 650,424 828,864 13,358 2,036,665 2,878,787 THEIR GROSS AND NET REVENUES 47 G. — Their Railway Receipts and Trading Receipts Combined. Total Goods. Passengers. Trading Receipts. Gross Revenue. Barry Brecon and Merthyr . Cardiff Furness Hull and Barnsley . . North Staffordshire . Rhymney TaffVale £ 303,673 86,679 61,407 345,203 644,815 669,999 286,687 660,424 £ 49,217 32,796 2,611 140,409 27,438 283,739 86,822 222,497 370,168* 5,626 460,006 68,975 127,884 99,467 1,890 119.971 £ 723,048 125,101 613,923 654,687 700,137 1,053,205 374,299 992,892 ' 2,938,787 844,429 1,253,976 5,037,192 ♦ Dock Dues, etc. H. — Their Trading Receipts Expenses and Net Revenue. Receipts. Expenses. Net Revenue. Barry Brecon and Merthyr . . . Cardiff Furness Hull and Barnsley North Staffordshire . . . Rhymney TaffVale 370,158 6,626 460,005 08,975 127,884 99,467 1,890 119,971 £ 177,059 238,299 26,707 61,334 69,545 48,332 £ 193,099 6,626 221,706 42,268 76,550 29,922 1,890 71,639 1,263,976 611,276 642,700 Receipts from outside operations range in the United Kingdom from 5 to 10 per cent, of the aggregate revenues. The maximum appears where it would naturally be looked for — ^in the southern lines. The harbours, steamers and other appliances for carrying on their cross-channel traffic require to produce large returns in order merely to cover working expenses, let alone interest on capital outlay. The following condensed table gives, first, the three divisions of their traffic earnings proper — ^merchandise, minerals and live stock; next, the passenger receipts, and finally, the trading receipts. The last item is £890,000 out of a grand aggregate of £9,126,300, or very nearly one-tenth. In the new form of railway returns it will be 48 BRITISH RAILWAYS interesting to see a detailed profit and loss account for the hitherto mysterious cross-channel operations. The Southern Passenger Lines. I. — Their Railway Receipts Proper. Mer- chandise. (OOO's) Live stock. (OOO's) Minerals. (000-8) Total Gk)od8. (OOO's) South- Eastern and Chatham . London, Brighton and South Coast £ 745-4 517-3 £ 20-6 12-5 £ 406-4 393-3 £ 1,172-4 923-1 1,262-7 33-1 799-7 2,095-6 K. — Their Railway and Trading Receipts Combined. Goods. (OOO's) Passengers. (OOOs') Trading. (OOO's) Gross Revenue. (OOO's) South-Eastern and Chatham. London, Brighton and South Coast £ 1,172-4 923-1 3,606-2 2,524-6 £ 607-6 292-5 £ 6,386-1 3,740-2 2,095-6 6,130-8 900-0 9,126-3 The trading habit varies greatly among the Scottish railways, and produces correspondingly different results. It is largely developed on the Caledonian, but much less so on the North British. The subjoined tables show for the former trading receipts equal to fully 9 per cent, of gross revenue, but on the latter only about 7J per cent. The Scottish Group, 1911. L. — Railway Receipts Proper. Mer- chandise. (OOO's) Live Stock. Minerals. (OOO's) Total Goods. (OOO's) Caledonian Glasgow and South-Western Great North of Scotland . . Highland North British £ 1,320-7 537-0 141-8 125-1 1,424-9 £ 78-9 32-7 16-7 25-4 93-8 1,310-0 413-9 68-0 49-8 1,616-8 2,709-6 983-6 226-6 200-3 3,136-5 3,649-6 1 247-5 3,468-6 7,266-5 THEIR GROSS AND NET REVENUES 49 M. — Thbib Railway and Trading Receipts Combined. ITotal Goods. (OOO's) Passengers. (OOO's) Trading Receipts. (000s) Gross Revenue. (000-8) Caledonian Glasgow and South-Western Great North of Scotland . . Highland North British 2,709-6 983-6 226-5 200-3 3,135-5 1,958-6 829-5 263-5 350-8 1,855-9 471-2 295-7 28-1 15-6 134-0 5,139-4 2,108-8 5181 566-7 5,125-4 7,255-6 5,258-3 944-6 13,458-4 N. — Their Trading Receipts, Expenses and Net Revenue. Receipts. (OOO's) Expenses. (OOO's) Net Revenue. (OOO's) Caledonian Glasgow and South-Western . Great North of Scotland . . Highland North British £ 471-2 295-7 28-1 15-6 134-0 £ 243-2 135-9 9-7 10-6 99-3 228-0 159-8 18-4 6-0 34-7 944-6 498-7 445-9 Finally, we come to the Irish railways, for which in these days few have a good word to say. But where depreciation becomes a fashion it is always liable to be overdone, and so it is in Ireland. Surprising as it may appear to glib parliamentary critics, there are some good points in the Irish railways. One of them is, that they stick closely to their proper business and do not waste their energy to any material extent on " side shows." Perhaps they are beginning to be bitten by the new universal providing policy, but the accounts of 1911 are comparatively free from symptoms of it. Except in one case, and that an English line — ^the Irish section of the Midland Railway — outside receipts are insignificant. 60 BRITISH RAILWAYS The Irish Group, 1911. 0. — Their Railway Receipts Proper. Mer- chandise. (OOO's) Live Stock. (OOO's) Minerals. (OOO's) Total Goods. (OOO's) Belfast and County Down . Dublin and South-Eastern . Great Northern of Ireland . Great Southern and Western Midland Great Western . . Midland (Irish Section) . . £ 28-7 62-1 383-7 5180 2281 128-2 £ 21 12-8 52-7 132-6 78-4 6-5 £ 10-6 13-3 83-7 99-4 24-4 48-3 £ 41-4 88-2 520-1 760-0 330-9 1830 1,348-8 285-1 279-7 1,913-6 P. — Their Railway and Trading Receipts Combined. Total Goods. (OOO's) ^^HS Gross Revenue. (OOO's) Belfast and County Down Dublin and South-Eastern . Great Northern of Ireland . Great Southern and Western Midland Great Western Midland (Irish Section) . . £ 41-4 88-2 520-1 750-0 330-8 183-1 £ 121-6 193-8 559-4 738-3 283-7 199-5 £ 16-1 10-2 36-6 13-6 18-3 34-7 £ 179-0 292-3 1,116-1 1,501-8 632-8 417-3 1,913-6 2,096-3 129-4 4,139-3 Q- — Their Trading Receipts, Expenses and Net Revenues. Receipts. Expenses. Net Revenue. Belfast and County Down . Dublin and South-Eastern . Great Northern of Ireland . Great Southern and Western Midland Great Western . . Midland (Irish Section) . . £ 16,067 10,226 36,583 13,466 18,290 34,731 £ 17,367 1,033 34,767 3,278 7,248 30,527 £ 1,300* 9,193 1,816 10,188 11,042 4,204 129,363 94,220 35,143 Deficit. CHAPTER V RAILWAY ACCOUNTS AND STATISTICS Next to labour unrest the most vexed question which railway administrators have had to face in recent years has been the agitation for fuller and more instructive accounts. As to the necessity for these, all are agreed, and they could hardly be otherwise in view of the fact that the statutory forms in use up to the end of 1912 had been in force for about half a century. It stands to reason that they had after such a lapse of time become quite inadequate and out of date. Had the agitation ended with a demand for the reform of this universally admitted evil it might have met with little resistance from the officials concerned. Im- portant concessions might have been granted years ago and promptly brought into operation. But the reform party had an advance wing, the leaders of which aimed at much more than adequate accounts. They had worked out in their own heads ideal schemes of statistics in which every movement on the railways was to be reduced to abstract units. Passenger traffic was expressed in passenger units, and freight traffic in freight units. One passenger one mile, and one ton of goods one mile, were advocated as universal measures of transportation. How to arrive at these imaginary units was and still is the chief difficulty. Sir George Paish and Mr. W. M. Acworth, the most zealous exponents of the ton mile unit, have read elaborate papers on the subject before the Royal Statistical Society. These made a sufficient impression on the Board of Trade to induce it to appoint a Departmental Committee of Inquiry. But it was cleverly arranged so as to avert any 61 52 BRITISH RAILWAYS danger of positive conclusions. The statistical reformers and their official opponents were evenly balanced on the committee, and on important points the result was generally a drawn battle. Large concessions were made by the railway managers with respect to the annual accounts, but the hne was drawn at ton mile units. They were tabooed as a costly and, for all but statistical speciaHsts, a useless luxury. While sympathising with the statistical experts and appreciating their academic enthusiasm on behalf of ton miles we have to consider here only the practical merits of the proposal. The sole questions for us are : (1) if ton miles be the best possible test of efficiency, (2) if they are likely to be of great value to railway officials in working the traffic, and (3) if no simpler and more direct checks on wasteful or inefficient management are available. Confessedly ton mile calculations have to go a long way round to get at their result. When they do reach it they find that it is an unwieldly and not always a rehable result. If railway managers can suggest any- thing simpler and quicker of appHcation, as I believe they can, we are entitled to hear it. The reader may remember that a ton mile campaign was started years ago at Euston, and though it met with a large amount of support, the London and North-Westem directors successfully opposed it. After that it became a purely theoretical movement, and even the theorists are much divided in opinion regarding it. As for the pubUc, they cannot apparently be induced to make the slightest effort to understand it. To Mr. Ac worth and Sir George Paish it seems, of course, perfectly simple, but their definitions of it are not always precise and unam- biguous. A fair sample of them is to be found in the following extract from Mr. Ac worth's handbook of railway economics : — " The unit is one ton of goods or one passenger carried one mile, or shortly, the ton mile and the passenger mile. For many purposes, at least under English conditions, we may treat ton miles and passenger miles as equivalent, and add them together to produce traffic miles. Traffic ACCOUNTS AND STATISTICS 53 density is the number of traffic miles over each mile of line per annum. The figure is the quotient of the total traffic miles run on the railway divided by the length in miles of the railway. These figures, practically universal in other countries, are never published, and only exceptionally calculated out in this country.'' Sir George Gibb and Sir George Paish agree with Mr. Ac worth that " English published reports contain no information whatever as to average receipts per passenger per mile and per ton of freight per mile ; no particulars as to the ton or passenger mileage, the train load, the car load or the length of haul — all of which are essential to the administration on modern scientific principles.'* Sir George Gibb adds : " Not only is this information absent from the published reports hut it is known not to exist. It has not been the practice in England to compile such information.'' Mr. Acworth, it will be noticed, is not argumentative. He leaves that part of their joint work to Sir George Gibb. From the former we simply learn what the ton mile is, or rather what it is meant to be. The latter sets forth what he deems to be irresistible and unanswerable reasons for adopting it. In his preface to The British Railway Position, he speaks of it as " the charging unit," and thus explains its function : — " The mile as a unit is common both to train miles and ton miles, and no unit of distance can be better. But the train varies so widely in its composition that it is wholly unsuitable for the purposes of exact measurement of work done. The ton, on the other hand, is a unit of weight as constant and uniform as the mile. It is, moreover, the unit habitually used for charging purposes. Almost all railway rates for weight traffic are charged per ton mile. What reasonable objection can therefore exist to the use of the ton for statistical purposes in conjunction with the mile ? " The inherent vice of the train mile unit is its uncer- tainty. As a standard of measurement a train is little better than the historical lump of chalk. One train may carry 600 tons, or in America perhaps 3,000 tons of paying 54 BRITISH RAILWAYS freight, while another train may consist of two smaU wagons with two tons in each wagon, run at a loss under the incentive of keen competition. In tram mile state- ments each of these trains is treated as if they were identical. Hence while train mile figures are most useful -—essential indeed for some purposes— they are for other purposes utterly unsound and worthless." There may be no difficulty in discovermg weak points and anomaHes in the train mile unit, but equal ingenuity exercised on the opposite side might be just as damaging to ton miles. In truth the same fundamental objection may be made against them both— namely, that in taking averages many different kinds of train miles and ton miles are lumped together. A hundred tons carried one mile, one ton carried a hundred miles, and five tons carried twenty miles all count the same in ton mile statistics, though they may have very different revenue values. All criticism of this sort cuts both ways. The traffic unit at present in use, and which our railway administrators prefer to the ton mile, is the train mile. In their reports to the Board of Trade they give the aggregate train mileage and the total number of tons carried during the year. There they stop, but the statisticians wish them to go considerably further. It is a comparatively easy matter to take the train records and add up the mileage of all the trains run during a given period. It is quite another thing to record the mileage of every parcel, every bale of goods, every barrel of flour, and every wagon -load of coal that goes from one station to another in the course of a year. But all that would have to be done in order to obtain a complete record of the ton mileage. In hundreds of thousands of cases the weight of a consignment, large or small, would have to be multiplied by the distance it was carried, and all these results would hav^ to be added up at the year's end. In the case of a trunk line like the London and North- Western or the ]\Iidland, the annual aggregate might run into tens of thousands of millions. It becomes, in fact, an astronomical calculation. There is no insuperable difficulty about it, ACCOUNTS AND STATISTICS 66 however. Foreign railways do it, and in this country the North-Eastern Railway has the ton mileage worked out for the information of the management and their friends on the press. The shareholders, however, have expressed no strong curiosity regarding it, and so far they have been content with the meagre data furnished in the statutory accounts. One can quite understand railway officials hanging back in a matter as to which no popular pressure is being appUed to them, and the practical value of which they do not admit. Strictly speaking it is not a question for shareholders or the general public so much as for rail- way officials themselves. If the ton mileage data were collected and worked out as the scientific statisticians demand, they would never get beyond a select circle of readers. The various railways might exchange their figures with each other, and a certain number of copies might be suppHed to the press. Li those various ways ton mile figures would be of technical and statistical value. At the very least they would be worth the cost of preparing and printing. But it cannot be fairly argued that they are a sine qua non of efficient and economical railway administration, and that no up-to-date railway can afford to be without them. They are more of the nature of a statistical luxury. Many interesting and by no means useless calculations could be made with them which hitherto we have had to do without. Sir George Paish, in his book on The British Railway Position, has shown that the ton mile formula admits of great variety of applica- tions. Once the necessary data have been obtained, that is the weight of every consignment and the distance it is carried, the averages that can be worked out are legion. The following are a few examples of the sort of information that is being demanded by scientific statis- ticians. In the " Railway Accounts and Returns Act " they have obtained a considerable instalment of them, but the ton mile, which they consider the corner-stone of their scheme, is still denied them : — Ton mileage is weight multiphed by distance. 56 BRITISH RAILWAYS The train load is obtained by dividing train mileage into ton mileage. The car load is obtained by dividmg car mileage mto ton mileage. , . ^ . j For engine loads divide engme mileage mto ton and passenger mileage. . For average lengths of haul divide tonnage mto ton mileage. . .. . , x • For passenger coaches per tram divide passenger train mileage into carriage mileage. For goods wagons per train divide goods train mileage into wagon mileage. For average rate per ton per mile divide goods ton mileage into goods receipts.^ Examining these seriatim we find that they all hang upon the first — " Ton mileage is weight multiphed by distance." Neither of these essential factors is as yet within reach. All that the Board of Trade returns furnish is the aggregate tonnage and the aggregate train mileage of the year. What would be needed for a record of ton mileage is the total number of tons carried one mile, the number carried two miles, the number carried three miles, and so on to the longest haul on the railway. Existing information falls far short of that. It only tells us the aggregate weight carried during the year, and the aggregate distance run by goods trains. That teaches us virtually nothing. Until we know the respective weights carried at each distance from one mile upwards, nearly all the rest of the averages which Sir George Paish considers so desirable will have a missing link. Train loads cannot be worked out without ton mileage (the weight of each item multi- plied by the distance it travelled), neither can car loads or engine loads. So, too, without ton mileage there can be no reckoning of the average length of haul, or of the average number of coaches in a passenger train, or of wagons in a goods train. Without these details we cannot ascertain the average rate per ton per mile. It * The British Railway Position, p. 71. ACCOUNTS AND STATISTICS 57 is not disputed that they would be scientifically valuable and in a round-about way useful. There are, however, a good many other reforms at once more practical and more urgent. To mention only one, a thorough analysis of working expenses is much to be desired. Though there may be among statisticians and railway experts many different opinions, or father many degrees of enthusiasm, on the subject of ton miles, absolute agreement exists as to the great improvement which the new railway accounts will be upon the old ones. This will be seen in the first of the annual reports based on the new schedules which will be due a year hence. But it will be more fully appreciated in the annual reports of the Railway Depart- ment of the Board of Trade, in which the extended statistics will be properly collated and tabulated. The first of these is not due, however, until the autumn of 1914, and it will cover the operations of 1913. May we hope that the Board of Trade statisticians, when they are incorporating the results of the new schedules in their annual returns, will take the opportunity to revise the latter and modernise them ? They contain masses of data as to railway capitals and dividends which may be usefully condensed. A good many of the tables are needlessly expanded and overloaded with details of small value. Much space is devoted to purely finan- cial data which might be better occupied with operating results of the various railways. In a word, it is trafl&c rather than finance that the public are interested in. Even shareholders begin to feel a little curious as to how their dividends are earned. It is to be hoped that hereafter operating results will be dealt with on modern lines, as in the United States and other countries where they are really believed in, and not merely published under compulsion. Though both the receipt and expenditure sides have hitherto been weak, the expenditure figures have been the most inadequate. Their analysis has not been carried far enough to admit of comparison with the corresponding results of other national railway systems. Distinction between goods and passenger traffic is practically limited 58 BRITISH RAILWAYS to cross train mileage and gross receipts. But much more than that is looked for now-a-days from railway statisticians. t.j- -j j t It is true that receipts are elaborately subdivided, in the passenger department season tickets, excess luggage, parcels and mails are separately specified, while under goods receipts we have merchandise, live stock and minerals distinguished. Some interesting and instruc- tive lessons might have been drawn from these, if in the working expenses an attempt had been made to allocate the proportions due to passenger and goods train mileage. A minute allocation is obviously im- possible, but one sufficiently correct for comparative purposes should not be insuperably difficult. An allocation of working expenses between passenger and goods mileage is the ffi-st requisite of scientific rail- way accounting. Every efficient railway staff may be assumed to already possess a considerable amount of the necessary data. The actual running cost of passenger and goods trains, the repairs and renewals for each class of rolling stock, and the shares of traffic expenses charge- able to passengers and goods respectively, should be all on record, or if not they should be easily estimated. The only difficulty would be with the three or four cate- gories of common expenses — maintenance of way, general charges, law expenses, rates and taxes, etc. Those would have to be divided between the passenger and goods mileage on some definite principle as to which railway accountants might easily differ. In the end, however, a basis of agreement would evolve. With separate expense accounts for passenger and goods traffic combined with systematic allocating of all common expenses, we should be able to form an idea of their comparative values. Train mileage figures would have some meaning when working expenses per mile could be calculated as well as receipts per mile. They are the complement of each other, and neither of them is of much practical value by itself. In this as in other connections it is a question for our railway managers if they might not with advantage ACCOUNTS AND STATISTICS 59 adopt a few more American methods in our freight service. At least they might give them a closer and more systematic study than they have yet done . Even a railway manager cannot learn everything about American rail- roading on a flying trip of two or three weeks, most of which may be spent in festivity and sight-seeing. These hoUday trips have generally been limited to high officials of British roads. So far as we have observed they have not included any of our railway accountants, the class who, next to engineers, have the best right to be consulted. A few experts selected from the Clearing House staff and unbiased in favour of any individual railway, might learn a great deal from the statistical departments of the principal American roads. Give them six months to master the subject and to collect all the necessary data ; then let them come home, and after full considera- tion report what they have seen. They will, we doubt not, be cordially received and have ever3^hing lucidly explained to them. They will see in the accountants' office how minutely every item of revenue and ex- penditure is recorded, how carefully it is analysed and tabulated, and how the results are passed on to the heads of the respective departments. They will find passenger and freight train accounts distinguished from each other, each being credited with its proper receipts and debited with its proper share of expenditure. The fijial result, as we have already indicated, is a profit and loss account for every train run. It may not be absolutely exact, but it is at least an honest approximation, and for com- parative purposes it has great value. Controversy still exists as to various points in the operation, and roads may differ even considerably in their classification of receipts and expenses, but there is a definite standard recognised and being worked up to. On our own railways there is no standard of any kind or even an approach to it. Railway statistics are a still-bom science in this country. * • Having studied the report of their expert accoun- tants, our railway managers might meet and confer with 60 BRITISH RAILWAYS each other as to what action,if any, it calls for. Toalayman it seems that an immediate result of it should be the formation of a statistical department at the head office of every trunk line. Its duty would be to analyse and tabulate the whole of the accounts, both receipts and expenses. It might be possible to run them so fine that railway managers might be able to tell what every train earned and what it cost, how many miles it ran, and how much per mile were its earnings and expenses. This, carefully ascertained and verified, would be the train mile unit which the Americans are now preferring to the ton mile. Many advantages might conceivably flow from such an improved system of accounting. The railway manager, knowing more or less precisely what a given train was earning, could consider ways and means to increase its earnings. Knowing what it cost to run, he could always be turning over in his mind how expenses were to be reduced. With all these data before Mm he would have a definite standard by which to determine his rates. He would see opportimities of putting on special rates to encourage traffic capable of large expansion ; not necessarily foreign imports only, though they have been the chief objects of his solicitude hitherto. He might without injustice to the foreigner give the British producer a fair chance in his own markets. BOOK SECOND— HISTORICAL CHAPTER VI THE TRANSITION FROM ROAD TO RAIL It is one of the ironies of social and industrial progress that no sooner has it perfected one of its tools than it discovers some superior novelty. Then the old tool, on which generations of skill and outlay may have been spent, is thrown aside. The novelty absorbs all the thoughts and activities of the nation, and goes through all the usual stages of development, until it in turn reaches perfection and is ready to be superseded by another new discovery. In complete accordance with this historical law of evolution and transformation, British road traffic had almost reached the limit of its capabilities when the new system of transportation was ushered in. Telford and Macadam, the great road-makers of the eighteenth century, retired from the scene of their triumphs as Stephenson, Brunei and the pioneer railway builders of the nineteenth century entered it. One after the other the pack-horse, the springless cart, the carrier's wagon and the stage coach had had their day. Each of them had done its work so well that the traffic outgrew their capacity, and they had to make way for larger and quicker means of transport. This was pre-eminently the case in the second half of the eighteenth century, when the industrial development of England was quickened beyond precedent by the introduction of machinery and the growth of oversea trade. Even before the middle of the century road 61 62 BRITISH RAILWAYS transport had begun to assume an organised form, and the public carrier had become a public institution. The turnpike system was then nearly a century old, the first act authorising tolls having been passed in 1663 — three years after the Restoration. Charles the Second gave it his hearty support, and it may be remembered to his credit as one of the unquestionable blessings of his reign. This important Act (15 Car. II. c. 1) was applied to the section of the Great North Road which rims through the counties of Hertford, Cambridge and Huntingdon, and its three toll-gates were placed at Wadesmill, Caston and Stilton. According to Jolm Ogilby, the Cosmographer Royal of that day, there were then eighty-five main roads in England and Wales, and he mapped the whole of them in his Britannia. At first the extension of the turnpike system was slow, but its marked effect on the growth of local trade and the value of property gradually excited the envy of even the least progressive parts of the country. In the reign of Queen Anne agriculture, industry and trade were still greatly localised, and consequently very restricted. In winter farmers could not travel to market, consequently corn was dear to the consumer and cheap to the producer. London was inaccessible even to dis- tricts as near as Horsham, where in winter a quarter of a fat ox was commonly sold for fifteen shillings and mutton could always be had at five farthings per pound. But by the middle of the eighteenth century the turn- pikes had begun to tell on the cost of transport. Postle- thwayte's dictionary, published in 1745, has an interesting article on roads, from which we learn that the cost of carriage for goods and merchandise had of late years been greatly reduced. The number of wagons travelling regularly between London and Birmingham had in- creased to twenty-five or thirty per week, while the rate per cwt. had declined from Is. to 35. or 45. Between London and Portsmouth the old rate had been 75. per cwt., and the new one was 45. or 55. Much of the traffic on this road consisted of Government stores for the navy and the British forces abroad. The Admiralty THE TRANSITION FROM ROAD TO RAIL 63 prided itself on the much cheaper transport it was now enjoying as compared with the corresponding charges during the wars of Queen Anne. The western ports, Bristol, Exeter, Gloucester, etc., were also great gainers by the improved turnpikes. The carriage of wool from Exeter to London, which had previously cost 125. per cwt., was now down to 8s., and other goods had been proportionately reduced. Such a wonderful transformation as this was not likely to escape the attention of so shrewd an observer as Adam Smith. In the eleventh chapter of his Wealth of Nations he thus eulogises it : — " Good roads, canals and navigable rivers, by dimin- ishing the expense of carriage, put the remote parts of the country more nearly upon a level with those in the neighbourhood of the town. They are upon that account the greatest of all improvements. They encourage the cultivation of the remote, which must always be the most extensive circle of the country. They are advan- tageous to the town by breaking down the monopoly of the country in its neighbourhood. They are advantage- ous even to that part of the country. Though they introduce some rival commodities into the old market, they open many new markets to its produce. Monopoly, besides, is a great enemy to good management, which can never be universally established but in consequence of that free and universal competition which forces everybody to have recourse to it for the sake of self- defence." The culminating stage in the history of British roads was the first quarter of the nineteenth century. Then im- provements followed each other rapidly, until the Telford and Macadam age was fully ushered in. The mere men- tion of a few significant dates may be more instructive to the reader than pages of elaborate description : — In 1757 Thomas Telford, the greatest and most versa- tile engineer of his day, was born at Eskdale in Dumfries- shire. His chief rival as a road maker, John Loudon Macadam, was then a year old, he having been born in 1756. 64 BRITISH RAILWAYS From 1783 to 1810 Madacam carried on a systematic inspection of the roads in England and Scotland, covering about 30,000 miles of gromid. He then published his famous Observations on the Highways of the Kingdom. In 1803 Commissioners were appointed to improve the roads in Scotland, and Telford was engaged as their engineer. He began in the Highlands, and built the splendid network of high-roads which ever since have been the joy of the southern tourist. His other great achievement in the north was the turnpike road between Glasgow and Carlisle. In 1806 the first of a long series of Select Committees began to study the question of road reform, which our own local authorities are still working upon. In 1808, 1809 and 1811 the investigation was resumed, and occasionally it bore fruit in the shape of parliamentary grants for special roads. Such a grant was made in 1815 for the London to Holyhead road. The greater part of this was entrusted to Telford, but Macadam did a short piece of it between London and High Barnet. Their respective systems of road-making were to be seen together in that neighbourhood, and each had its partisans. In 1819, 1820 and 1821 Select Committees continued to study the road problem, sometimes under Telford's and sometimes under Macadam's tuition. During this period grand schemes were started for widening and straightening the principal turnpikes, including the Great North Road and the Great Western. Frequently they needed financial help, and every session applications were made to Parlia- ment to extend the term of their leases or to allow them to increase their tolls. As a rule such petitions were readily granted, for the value of good roads was becoming apparent in the rapid growth of trafiic, both passenger and mer- chandise. The carrier's cart and the stage coach both flourished exceedingly. So little presentiment was there of the coming revolution in transport, that during the decade preceding the commencement of the railway era no less than a thousand miles of new road were built. At the advent of the railway the roads were being THE TRANSITION FROM ROAD TO RAIL 65 taxed to their full capacity, and the cost of maintaining them was becoming a serious burden on the ratepayers. Rates and tolls together rendered them costly to their users. Any scheme of extension or of new construction would have been very expensive. Thus the railway deHvered the country from a grave dilemma in providing new channels for its growing commerce. It not only saved the people of that day a large expenditure on new roads, but it lessened to a great extent the cost of keeping up the existing main roads. These were the first of a long series of boons which it conferred on the nation. A second set of advantages of almost incalculable value which we owe to the railway arose from the cheapen- ing of transportation. If this blessing had been limited to the existing traffic it would still have been immense, but it multiplied itself over and over again by enlarging the area of profitable transportation. Distances which were impracticable to the carrier's cart could be easily covered by the railway. The nearer that markets were brought to each other, the more business they did with each other. The more they all prospered, the more people had to spend, the more they travelled, the farther they went afield, and the more active economic life became. The effect of speed in enlarging the area of transporta- tion was soon realised by the original railway builders. Ingenious calculations on the subject were indulged in by the writers of the early text-books, notably by Dr. Lardner. He became (quite enthusiastic about the re-"^ lation of speed to the*^ radius of transportation, as the following passage shows. He may be partly responsible for the speed craze which developed among railway managers in a later age. ^ "It is evident that any improvement in transport ^ which will double its speed wiU double the radius of this circle. An improvement which will treble its speed will in- crease the same radius in a threefold proportion. Now as the actual area or quantity of soil included within such a radius is augmented not in the simple ratio of the radius itself, but in the proportion of its square, it foUows that a 66 BRITISH RAILWAYS double speed will give a fourfold area of supply, a triple / speed a ninefold area of supply, and so on." ^ The same idea has been expressed more neatly if less scientifically by an American economic writer. Speaking of the American railway rates of twenty or thirty years ago, Mr. Atkinson showed how the transportation charges had become an insignificant element in the price of products. The cost of delivering bread from the baker to his customers was a larger element in the price of the bread than the cost of getting the wheat from the farmer to the miller and the Sour from the miller to the baker, though one distance was but a few hundred yards and the other as many hundred miles. Unfortunately such feats of cheap transportation, though possible on prairie roads admitting of heavy trains and long hauls, were out of the question in an old coimtry handicapped by heavy grades, over-capitalisation and primitive methods of working. It was a great advantage to the American railway pioneers to have a perfectly open country to operate in. The British pioneers, on the other hand, had all the limitations, restrictions and prejudices of an old country to contend with. They found it difficult to break away from existing ideas and habits. The first railway engineers had been chiefly trained as road surveyors, and they brought to their new work the minds of road surveyors. Many of the original lines were laid out with the grades and curves of neighbouring roads. Their train loads were proportionately light, or if heavy they had to be divided when they came to a stiff incline. Some railways had more up and down hill than level road, and the " humps " were negotiated in a variety of ways : Sometimes by a stationary engine at the top of the incline and sometimes with the help of a " pusher " engine, but generally by splitting up the train and taking it over a few wagons at a time. Examples of all these methods are to be found in a description of the Bolton and Leigh Railway written in 1842. " The speed of the luggage trains while moving on this line may be stated as varying from fiifteen to twenty THE TRANSITION FROM ROAD TO RAIL 67 miles per hour, but from the nature of the line it is exceed- ingly dijB&cult to state the speed including stoppages. It is very usual for an engine bringing merchandise from Liverpool to have trains of thirty-four wagons in each. With these trains they commonly pass over the Kenyon line two and a quarter miles, and stop at Leigh station, where a portion of the load is detached on account of there being an inclined plane 1 in 82 a mile and a half long between that and the next station, two and a half miles distant. The engine has to return once or twice for the remainder of her load . From this second station (Bag lane) the goods are drawn up another inclined plane of 1 in 30 a mile and a quarter long by a stationary engine, and forwarded by another locomotive engine about two miles farther to the top of another inclined plane about three-quarters of a mile in length, worked by stationary power. After descending this latter incline by rope they are taken to the yard or warehouse by horses." It was not local lines only that suffered from primitive engineering and rude construction. Even the main lines started with a great diversity of grades and curves. Ac- cording to Sir George Findlay, while a coal engine could draw eight to ten times its own weight on easy grades, there were places on the London and North-Western where it could draw only two and a half tons to one of engine, while between Cromford and High Peak it could draw only its own weight. The average grade of the main line admitted of 5 tons weight to one of engine, but a passenger express rimning at forty-five to fifty miles an hour between London and Carlisle could not undertake more than 2J tons weight to every ton of engine. The primitive railway of 1842 was very soon overtasked and in order to keep up with its work it had to be con- tinually improving its road-bed and its rolling stock, rebuilding itself in fact. This was no doubt another of the causes which contributed to its high average cost per mile. Not only was its capitalisation swelled by con- tinual extensions and improvements, but its working expenses must also have been exaggerated in consequence. The defects of its youth seem to have adhered to it long 68 BRITISH RAILWAYS after it had reached manhood, and it may be doubted if they are outUved even yet. The worst of them appears to have been excessive economy in engine power and train equipment. How this restricted and delayed the develop- ment of traffic Mr. Ac worth has thus explained : — "In the early days, with puny and extravagant engines, with no signalling systems, rudimentary hand- brakes and a considerable and profitable passenger traffic, the difficulty of working a line crowded with trains was so great that railway managers had no great temptation to try and attract low-class traffic from rival carriers by making low rates. What traffic they got was of small bulk and high class, to which speed was of more importance than cost. The exclamation of the London and Birmingham Railway director when it was suggested to him that his highly aristocratic line should carry coal to London in competition with the Grand Junction Canal and the Newcastle coal-brigs, * Coal ! why they'll be asking us to carry dung next ! ' may or may not be apocryphal, but it represents a real and not unjustifiable attitude of mind. And indeed, had it been possible for the London and Birmingham to remain as it began, a great through line with no exten- sions and no branches to dilute its profits, it might well have gone on to this day untroubled with low-class innovations such as coal and third-class passengers, and yet have continued to pay without difficulty to its share- holders its original 10 per cent, dividends." ^ One strong point in favour of railways which has never been adequately impressed on the public, and to which their critics never do justice, is the enormous effect they had in the way of cheapening transportation. To-day it costs just about as much to send a ton of goods by railway as it did a century ago to send a hundredweight. Twenty to one is about the usual proportion of the amoimt of transportation that can now be obtained for a given sum as compared with the old cartage rates. The complex schedules of railway rates prescribed by Parliament disguise this important fact almost beyond ^ Elements of Railway Economics, p. 63. THE TRANSITION FROM ROAD TO RAIL 69 recognition, but it is none the less true, and a few examples will demonstrate it. In describing the evolution of the turnpike system in the eighteenth century, some of the standard cartage rates were incidentally mentioned. Between Birming- ham and London, for instance, in the days of the pre- historic roads, 75. per cwt. was the ordinary charge. The turnpike system and the improved cartage services which it introduced gradually reduced this to 35. or 45. per cwt. The distance by rail between the two cities is 113 miles, and the rate about three- fifths of a penny per ton per mile. On the 113 miles this would run to 55. 9d. per ton as compared with 75. per cwt. in the roadless age, and 45. per c\vt. in the turnpike days. In the case of Bristol and London the distance by rail is 118 miles, and the rate again averages for general merchandise three-fifths of a penny per ton per mile, or 65. per ton for the whole distance, as compared with 125. per cwt. on the old roads and 85. per cwt. on the new ones. The Portsmouth road was a very busy thoroughfare, especially in war-times. There were many regular carriers on it as well as army contractors and transport agents. Even here, though the traffic was heavy and the competition no doubt very keen, the cartage between London and Portsmouth seems never to have fallen below 45. per cwt., and in the pre-turnpike age it had been as high as 75. The distance is about 73 miles, which at 75. per cwt. would work out at 1*15^. per mile, and at 45. per cwt. would be O'Qd. per cwt. per mile. Railway charges for a corresponding distance will begin at seven-tenths of a penny per ton per mile, or 5s. per ton for the whole distance. That is for haulage alone and excluding terminals. The old English carrier had no terminal troubles. He collected his goods at the sender's door and delivered them direct to the consignee. There was no demurrage of wagons, no warehousing, no terminal extras. The old English public carrier was self-contained, and his methods primitive. His scale of rates had been rough-and-ready, and his calculations had been made by rule of thumb. The refinements of mileage rates were 70 BRITISH RAILWAYS beyond him. They came in with the canal, and were invented by parliamentary lawyers. To trace out all the intricacies of modern rates and classifications would be an almost endless job. The briefest and best way to explain them is to reproduce a few specimens from contemporary Acts of Parliament. These will indicate the origin of separate tolls and haulage rates, maximum and minimum schedules and other intricacies. The latter began with the canals, and were extended first to the early tramways and then to the pioneer railways. The earliest table of railway tolls appears to be that of the Croydon and Wandsworth Iron Road. It is dated 1801, and is based on mileage rates, but with a very limited classification. It reads as if it had been adapted from the canal tolls of the period : — Tolls on the Surrey Iron Railway (Croydon to Wandsworth), 1807. Per ton per mile All dung carried on the railway 2d. All limestone, chalk, lime and other manure (except dung), clay, breeze ashes, sand and bricks 3d. Tin, lead, iron, copper, stone, flints, coal, charcoal, coke, culm, fuller's earth, com and seeds, flour, malt and potatoes . . 4d. All other goods, wares and merchandise Qd. By placing these original railway tolls alongside of a contemporary canal tariff their parentage wiH be easily traced. The Glamorganshire Canal was operated in 1790 with two tonnage rates — 2d. per mile for minerals and 5d. per mile for merchandise. But the Sheffield Canal tariff of 1815 shows some progress toward our modern classification. It contains half-a-dozen different grades of freight, beginning with coal, iron ore, manure, 2d. per ton per mile ; advancing to limestone, lime, clay and bricks, Sd. per mile ; then to lead, iron, com, seeds, potatoes, etc., 4d., and finishing with " all other goods, wares and merchandise," 6^. per ton per mile. The so-called railways of the first quarter of the nine- teenth century were mere tramways, differing from an ordinary road only in having metals for the vehicles to run upon. They were governed by the ordinary cartage rates of the district, which, like the Surrey Iron Railway THE TRANSITION FROM ROAD TO RAIL 71 tariff, were in general force until the advent of the steam- engine. As late as 1825 one of the old canal classifica- tions was in operation on a South Wales line — the Rhymney. But the natural effects of increasing traffic are revealed here in a substantial reduction of rates. Taking it all round, the Rhymney Railway tariff of 1825 is only 50 per cent, of that of the Croydon and Wandsworth line in 1801. Rhymney Railway Tolls, 1825. Per ton per mile For all limestone, lime, materials for roads, dung, compost and all sorts of manures Id. Coal, coke, culm, cinders, stone, marl, sand, clay, iron, ironstone, iron ore and other minerals, building stone, pitching and paving stone, bricks, tiles, slates and all gross and unmanu- factured articles and building materials .... 1^. Manufactured or unmanufactured iron 2d. Lead, timber, staves and deals, and all other goods, wares and merchandise 3d. In 1826 we arrive at the first fully equipped steam railway — the Liverpool and Manchester, which was opened in that year. Previously interesting experiments had been made by George Stephenson and others with steam-engines for colliery and other special haulage. But this was the first scheme for a regular railway service for goods and passengers. Peculiar interest attaches to the tables of rates and fares with which it started. The freight rates are still those of the canal and the public carrier. Even its classification differs very little from what had been in use for years. The chief distinction is that a new class is introduced between the old third and fourth, and there are now five in all. Liverpool and Manchbsteb Railway Tolls, 1826. Per ton per mile For all limestone Id. Coal, lime, dung, compost and material for roads . . . . l^. Coke, culm, charcoal, cinders, stone, sand, clay, building, paving and pitching stones, flags, bricks, tiles and slates . . .2d. Sugar, com, grain, flour, dyewoods, timber, staves, deals, lead, iron and other metals 2^d. Cotton and other wool, hides, drugs, manufactured goods and all other wares, merchandise matters and other things . . 3rf. 72 BRITISH RAILWAYS A specimen of one of the earliest tables of passenger fares will be as interesting a souvenir of the infancy of our railway system as any of the goods tariffs. Passen- gers had the option of travelling in their own carriages, which were fastened on a flat car, or in one of the rude vehicles provided by the railway company. On some lines no social distinctions were recognised, and the same fare was charged for all carriages. The people for whom luxurious first-class coaches, sleeping-cars, dining-cars and Pullmans had afterwards to be run at a substantial loss, sat in solitary state in their family chariots . Plebeian travellers were assessed as under for distances of ten, twenty and over twenty miles. Liverpool and Manchester Passenger Rates, 1825. ». d. For every person travelling thereon not more than 10 miles in any vehicle 16 Do. exceeding 10 miles, but not above 20 . . . .26 Do. above 20 miles 4 This triple scale was in fact a rudimentary zone system. The uniform charge for any distance up to ten miles, next for any distance in the second ten miles, and then for any distance over twenty miles, was an anticipation of the twopenny tube. Like the twopenny tube it was an unsuccessful experiment, and had to give place to mileage rates. In those early days animals were regarded as passengers, and often travelled by passenger train. They had also to pay on the zone principle, but their sections were longer — fifteen miles instead of ten. On the Liverpool and Manchester line the first fifteen miles cost 25. ^d. for " every horse, mule, ass or other beast of draught or burden, and for every ox, cow, bull or neat cattle carried in or on such carriage." For any distance in the next fifteen-mile zone the charge was 45. per head. Pigs, calves, sheep, lambs and small cattle generally were 95. per head for any distance. Goods traffic was not conducted very long on the haulage principle. It was soon discovered to be imprac- ticable as well as unprofitable, and arrangements were THE TRANSITION FROM ROAD TO RAIL 73 begun for undertaking the entire goods service. Then we find tonnage rates coming in, and lump rates being charged without reference to mileage. The Liverpool and Manchester line at an early period of its history- obtained powers " to raise a separate fund of £127,500 for forming an establishment for the carriage of goods." When that was done a new table was issued of inclusive rates, that is, tolls and haulage combined. There were only four classes in it, as under — Carriaqb Rates (Tolls included). Per ton For all limestone, dung, compost, manure, materials for roads, stone, sand, clay, building, pitching and paving stones, tiles, slates, timber, slats and deals 85. Sugar, com, grain, flour, dyewoods, lead, iron and other metals . 95. Cotton and other wools, hides, drugs, groceries and manufactured goods lis. Wines, spirits, vitriol, glass and other hazardous goods . . 145. It was many years before an attempt was made to introduce method or science of any kind into railway rates. The pioneer lines being chiefly short and self- contained, each of them went its own way. Erratic rates and fares, as well as erratic methods of working, were the inevitable result. The long and the short haul difficulty soon made its appearance, but the terminal problem was of later origin. On one local line, the Leicester and Swannington, a twelve-mile zone was adopted. Merchandise carried more than twelve miles paid a flat rate of 4:d, per mile, presumably including terminals. But for distances under twelve miles an extra 6d. per ton was levied, the total product of the short haul not being considered sufficient to cover the cost of loading and unloading. Here the question of terminals comes in. Various other examples of the long and the short haul difficulty crop up in the primitive rate books. The St. Helens and Runcorn Gap line had a delightfully simple tariff with only two classes of freight — mineral and general merchandise. Coal carried the whole length of the line had to pay Hd. per mile, but for any shorter 74 BRITISH RAILWAYS distance the rate was 2d. per mile. The merchandise rate was a uniform 4jc?. per mile. It is curious to stumble on an old railway in the north of England which graduated its rates according to the length of the haul almost exactly as is being done now under the Acts of 1888 and 1894. For the first fourteen miles its rate was V^Od. per ton per mile; for the next six miles (fifteen to twenty) it was \'26d. per mile, and for all distances over twenty miles it was \'05d. per mile. The merchandise rate was a uniform 2d. per mile. Doubt- less the heavy traffic was chiefly minerals, and the rates would be adjusted to the circumstances of the various collieries. But it is an agreeable surprise to find the graduated distance rates of our own day thus plainly anticipated. Thus the spirit and the traditions of the road have survived in our railway policy after the road itself has been left a century behind. Even the peculiarities of its rates and tolls have been closely followed, and still exercise a very confusing influence on the modern railway mind. CHAPTER VII A CENTURY OF RAILWAY BUILDING The history of British railways is generally written as if there were only one t3^e of railway and it had grown up from a single origin. In reality there are several tjrpes, and each of them had an evolution of its own. The colliery rai lway was a familiar institution long before the lirsT — passenger train ran between Manchester and Liverpool. A system of transportation partly by canal and partly by rail had also been in operation for years. Li Northumberland and in South Wales short lengths of railway linked up local canals and bridged over gaps where the cost of a water channel would have been prohibitive. They also connected collieries and ironworks with the nearest navigable water. They had been tried and tested in many ways on a small scale before the idea of long-distance lines occurred to any one. The first generation of railway builders were small people who had no thought beyond the necessities of their own business. When steam traction came into use they experimented with it in various ways as best suited themselves and their circumstances. Sometimes they used stationary engines at the top of an incline, and some- times a rude kind of locomotive. As yet they had no idea of speed, and their locomotives did not often travel much faster than an ordinary cart. On inclines it was not expected to do more than the usual three miles an hour. Between the primitive colliery railway and the regular passenger line came the combined rail and canal system. 76 76 BRITISH RAILWAYS But this partnership did not last long. The railway, which had been at first intended as an auxiliary to the canal, ultimately absorbed it. One of our principal trunk lines — ^the Midland — ^is said to have had a humble origin of this sort, which is thus described in a recent history of the company : — " The first portion of the Midland Railway constructed on modern principles, worked by locomotives, and convey- ing passengers as well as minerals, was, beyond all question, the line from Leicester to Swannington. It was the earliest line of railway now belonging to the Midland, constructed by George Stephenson and his son Robert on the same plan which they had previously introduced with such great success between Liverpool and Manchester. Not only the engineers, but the first manager, Mr. George Vaughan, the locomotive men, the man to work the incline, the platelayers, the guard, were all brought from the Liverpool and Manchester line to instruct the local men to become proficient in railway management ; the rules and regulations of the Liverpool and Manchester were also adopted. The only difference between the two railways was that whereas the Liverpool and Manchester was a double line and had both passenger and goods trains, the Leicester and Swannington was a single line and had mixed trains carrying both passengers and minerals. By this means the new railway system was brought down from the north, where it had hitherto alone existed, into the very centre of England." Our three classes of railway trafl&c, minerals, merchan- dise and passengers, represent distinct types of railway which came into existence one after the other. Beyond doubt the mineral railway is the oldest of the three. The practice of running heavy coal wagons on wooden rails is traceable back into the seventeenth century. Previous to 1788 the rail itself was flanged and not the wheel, but in that year William Jessop had the happy inspiration to transfer the flange to the wheel. This rendered possible a great increase of speed combined with greater safety. The eminent engineer, Mr. James Brunlees, has described it as " an organic change which A CENTURY OF RAILWAY BUILDING 77 has been the forerunner of the great results accomplished in modern travelling by railway." The impetus given to railway building by the flanged wheel was strengthened by various improvements wluch quickly followed in the manufacture of rails. Cast iron was in course of time superseded by wrought iron. Iron bars were rolled by maclnnery instead of being hammered out by hand. Schemes for new iron roads — " train " or " drain " roads as they were caUed — multiplied so rapidly that Parliament resolved to extend to them the super- vision which it already exercised over schemes for new canals. In June 1799 a committee which had been appointed to consider the question recommended that " The Standing Orders of the House of the 7th May, 1794, relating to Bills for making navigable canals, aqueducts and the navigation of rivers, or for altering any Act of Parliament for either or any of those purposes, be ex- tended to Bills for making any ways or roads commonly called railways or drain roads." Such was the casual and innocent-looking origin of what is now known as " appljdng for parliamentary powers " — ^an evil custom that developed into a costly and obstructive system of legal blackmail. Of all the errors and abuses with which our railway builders are chargeable it is the worst and the least excusable. In nine cases out of ten the parliamentary duels which have to be fought over new railway projects are not only useless but wasteful, and often harmful. Instead of checking bad and unnecessary schemes it has encouraged their promotion. At the same time it has been a cloak for secret bargains and agreements contrary to the public interests, and even more so to the interests of the railways. In 1904 it was estimated by a competent authority that up to that date no less than £90,000,000 had been spent on preliminary surveys and parliamentary expenses out of a total of £1,200,000,000 of railway capital. For the then existing mileage (22,000 miles) this was equivalent to fully £4,000 per mile. Often the actual building of the rail- way did not cost so much. At the outset parliamentary 78 BRITISH RAILWAYS expenses were so moderate that reasonable exception could not be taken to them. In the very year that they were made compulsory on the promoters of new railways (1799) a Bill was presented to Parliament for a short line from Carno Mill to Cardiff, a distance of twenty-six miles with eighteen miles of branches. The expense of obtaining the Act was estimated at £894 175., and the entire estimate for land and construction was £31,105, an average of £1,200 per mile if we reckon the main line alone, and of only £1,000 if we include the branches. In these early days neither promoters nor lawyers nor railway contractors had any idea of the rich harvest that lay before them. It did not come in sight until the railway mania nearly half a century later. The financiers of 1799 were mere children compared with their successors of the King Hudson age. They had no suspicion of the possibilities of speculative capitalisation, and, on the other hand, the public had no suspicion of its dangers. But we who have to pay not only railway freights but public rates and taxes on grossly inflated capitals can devoutly wish that our railway finance had had a more sane and sober youth. Perhaps we have little right to reproach our grandfathers with their extravagance as railway builders. All or nearly all the extravagances which they introduced we continue with very little change. As often as not the abuses of their time have been aggravated rather than reformed. The parliamentary and financial leeches flourish as luxuriantly as ever. The legal blackmail which has to be paid on railway Bills, large and small, is if anything heavier than ever. We still bear the shame of loading down our railways with preliminary expenses to an extent that compels them to charge high rates in order to obtain even the most inflnitesimal return on their outlay. In this respect we enjoy an evil pre- eminence which no other nation envies. Much might be said about the colliery railway as an interesting pioneer, but we must hasten on to the second type—the commercial railway. The earliest example of it is the London and Croydon line, or, to give it its A CENTUKY OF RAILWAY BUILDING 79 original title, the Surrey Iron Railway. It ran from Wandsworth to Croydon, a distance of less than ten miles. It was designed exclusively for goods traffic, and had no passenger trains. Practically it was a public toll-road on which any one might travel in his own vehicle. The company provided no rolling stock and did no carrying on their own account. In its organisation, methods of working and scale of charges the line closely followed the analogy of the then popular canals. Its up-traffic from Croydon to Wandsworth consisted of agricultural pro- duce, chalk, flint, fuller 's-earth and other heavy freight, while the return loading was chiefly coal and manure. A diligent explorer in the pamphlet department of the British Museum has made the interesting discovery that the promoters of the London and Croydon line had ambitious hopes of carrjdng it by degrees down to Portsmouth. They obtained parliamentary powers for two additional sections — ^the Croydon, Merstham and Godstone being one, and the Godstone to Reigate another. But the second section stopped halfway at Merstham, and after struggling on for thirty years it was bought in 1838 by the Brighton Railway Company, who closed it. The original Surrey Iron Railway lingered on for another eight years, until 1846, when the rails were taken up and sold. Between the Surrey Iron Railway of 1801 and the Stockton and Darlington of 1821, which is the next land- mark in the history of the British railway, seven or eight experiments were made in different parts of the country. In 1802 a line eleven miles long was built in connection with the Tredegar Ironworks in Monmouthshire at a cost of £45,000, or £4,000 a mile. In 1809 a similar road in the Forest of Dean cost £125,000 for seven and a half miles, equal to £16,600 per mile. The others ranged from £1,400 to £5,000 per mile, and all of them seem to have been intended for goods only. The Stockton and Darlington was originally planned on the same lines, and only by degrees did it develop into a modern railway carrying passengers as well as goods. Out of the very varied and chequered experience of 80 BRITISH RAILWAYS the Stockton and Darlington Railway may be said to have grown the four distinctive features of modern railway service — first, steam traction ; second, combined goods and passenger traffic ; third, combined ownership of road and rolling stock; fourth, a monopoly user of both. Its success had an immediate effect in other districts where the new form of traction was already engaging attention. This was particularly the case in Lancaslure, and above all in the cotton trade. The canals were then in the heyday of their prosperity, and making a bad use of it. For very poor services they were making exorbitant charges and deliberately provoking unpopularity by petty insolence and tyranny. Liverpool at last threw down a challenge. In October 1824 the prospectus of a new railway was issued, the capital asked for being £400,000. The money was raised and a Bill introduced in the session of 1825. The canal interests organised such a formidable opposition that it was thrown out. But next year it reappeared, and this time it got through. The promoters were equally fortunate in planning and executing the line. Not imtil the eleventh hour did they decide in favour of steam against animal traction, and it was George Stephenson's " Rocket " that turned the scale. It triumphed over horse traction, stationary engines and all other proposed means of propulsion. Its average speed of fourteen miles an hour, rising on occasion to double that rate, put everything else out of court. So far these pioneer railways had been purely local, designed for local service and paid for with local capital. But now a higher stage had been reached, and the question of building trmik lines to traverse the country from end to end came up. It is surprising how quickly the boldest sort of proposals were put forward, and still more so how little attention was paid to them, though occasion- ally they were brilKant and far-seeing. Such a forecast was that of Thomas Gray, who as early as 1820 had pubhshed Observations for a General Railway. What he proposed was in fact a national railway network. It was to consist of six trunk lines radiating from London, with A CENTURY OF RAILWAY BUILDING 81 branches linking up all the towns and villages along each route. Earlier still, namely on the 11th February, 1800, a paper had been read at the Newcastle Literary Society, by Mr. Thomas, of Denton, advocating the extension of the colliery railways plan to the general carriage of goods throughout the country. Another apparently quixotic scheme was that of Mr. R. L. Edge worth for a special highway out of London which for the first ten miles should have four lines of railway on it worked by stationary engines. In 1822 another railway enthusiast — a London engineer named William James — projected a " Central Junction Railway or Tramway," which was to strike a bee-line from London to Stratford-on-Avon. There was a jBne touch of imagination here, but it did not suffice to save the scheme. Mr. James's labour was not wholly lost, however, as it brought him to the notice of the promoters of the Liverpool and Manchester Railway, who engaged him to make the surveys for their line. As it happened, the trunk lines of the United Kingdom were not destined to spring ready-made from the brain of any ingenious projector. They originated in quite another way — ^that is, in the orthodox British way familiarly known as " muddling through." All of them had an adventurous youth not without a dash of romance. Some of them had a hard struggle to get into London, and some had a hard struggle to get out of it. Not one of them has properly planned terminals according to modem ideas, and it is doubtful if they can ever be thoroughly modernised. Of the railways which started from London, the most notable are the London and North- western, the Great Western, the Great Northern, the London and South- Western, the Brighton and the South- Eastern. Those which started in the provinces and had to fight their way into London later on were the Great Central, Great Eastern, Midland, and London, Chatham and Dover. In looking back on the century's work of our railway builders we see 22,000 miles of the most solidly constructed railway in the world. Running on it, there are said to be 82 BRITISH RAILWAYS 20,000 locomotives, 70,000 passenger vehicles and 1,300,000 goods and mineral wagons. Working the traffic there is an army of 600,000 employees. In the course of a year they move 1,325 million passengers, 410,000 million tons of minerals and 114 million tons of merchandise. To measure the work of such a gigantic organisation and to judge whether or not it is living up to its full powers and opportunities, is one of the most interesting economic studies of our time. It would be a tedious task to review in detail the whole century of British railway building. Only its most superficial results are to be found in the official reports of the railway companies, or in the annual statistics of the Board of Trade. Both of these exhibit magnificent totals, but they are subject to many drawbacks and qualifications. However weU they begin, the fimal results are invariably meagre and disappointing. As a rule dividends are an insignificant fraction of the gross receipts. The high rates and charges which have to be paid by the traders for the use of the railways contrast badly with the poor returns which the shareholders receive on their capital. These two misfortunes are due mainly to two causes — over-capitalisation and expensive working. They are the crux of the railway problem of to-day, and they will be still more important in the railway problem of to-morrow. Labour unrest, higher wages, heavier rates and taxes, official interference, the discon- tent of traders, and all other railway grievances resolve themselves finally into diminishing profits and dividends. This has for some years past been a burning question with railway boards and at shareholders' meetings. Many isolated and haphazard attempts have been made to deal with it, but so far the results have been disappoint- ing. The old suicidal poHcy of competition is said to have been abandoned, and no doubt it has been honestly and sincerely on most railways, if not on all. But what- ever the results may actually be they have not as yet assumed a very palpable form in the accounts. As far as can be judged from this meagre information, the remedy has as yet had a very limited effect. Com- A CENTURY OF RAILWAY BUILDING 83 pared with the enormous amount of overlapping which there is known to be on our railway system as a whole, all the co-operative schemes yet put in operation can hardly have scratched the surface of the evil. Evidently much more drastic action will be needed to effect even a fraction of the reform that is both possible and impera- tive. If a commission of independent experts could be empowered to investigate all the train services in the United Kingdom and to report every case of duplication, leakage or waste, its report might be appalling. Some- thing of this sort will have to be done, however, before the public are roused to a fit sense of the gravity of the question. The savings that can be effected by pooling agreements between two or even three companies at competing points are a bagatelle beside what might be done if a similar reform were being undertaken on national lines. As a concrete example let us take the coal traffic of the United Kingdom and try to form an idea of the possible economies which might be effected in that one branch of traffic. The first discovery we may make is that nearly twice as much rolling stock is employed in it as would be needed if duplication could be entirely eliminated. With half the number of engines and wagons to handle there would be a proportionate amount of labour saved. There would be a proportionate reduction in the shunting and mar- shalling of trains. There would be a proportionately smaller area occupied by yards and sidings. There might be a great decrease in the number of coal wharves and depots in London and other great cities. The crowding of main lines with coal trains would be immensely relieved. Very probably two -thirds of the coal wagons now in use — or supposed to be in use — could do all the haulage and distribution actually required. But they would have to be as far as possible under one control. The chief coal-carrying lines — ^there are not more than haK-a- dozen of them altogether — might share groups of collieries amongst them, and as each group could be best served by a particular route, there would always be full loading for the trains. They would also have quick loading and 84 BRITISH RAILWAYS a straight run to their destination. It might also be arranged that coal trains should seldom have to break up en route, but that as far as possible they should run soHd to the end of their journey. In London alone the price of coal could be reduced at least 20 per cent, by a better system of carriage and distribution. At present coal trains come up from the collieries made up anyhow. There may be wagons for a dozen different districts as far apart as Hammersmith, Fulham, Kensington, Shoreditch and Canonbury all coupled together. The train has in that case to stop at Willesden Junction, and two or three wagons have to be sent to one place, two or three more to another, and so on until they are all got rid of. After a while they have all to be gathered together again and a return train made up at Willesden. The expense of distributing the coal after it reaches London may be as great as that of hauling it 150 or 200 miles from the colHeries. The various branches of goods traffic might be taken one after the other and examined from the point of view of scientific and economical operation. The special tests of paying traffic are the full wagon load and the full train load. The larger the area of collection the easier it wiU be to get full loads not only occasionally but regularly. In the United Kingdom the areas of collection are small to start with, and in most cases more railways have crowded into them than they can possibly support. The effect has been not only duplication of service but triplication, and even at times quadruphcation . A railway rate would require to be very profitable in order to main- tam three or four men doing the work of one or two. That is what is going on with a large part of the goods traffic of British railways. It is the root cause of heavy working expenses and slender dividends. If it could be taken in hand as a great national question a radical cure might be effected. But it cannot be cured by casual nego- tiations between individual railways. A pooling arrange- ment here and another there cannot touch the fringe of this problem. It must be attacked as a whole, and on the broadest possible lines. A CENTURY OF RAILWAY BUILDING 85 Railway directors and managers do not seem to see that in the interlacing and overlapping of traffic the nation - alisers will find their strongest and most practical argu- ment. Such conditions have been proved by many years' experience to be in the liighest degree wasteful and improvident. A moderate amount of thinking will show that they could not possibly be anything else. Duplica- tion of work is the direct negation of Adam Smith's classical doctrine of the division of labour. It has never been carried further in any industry than in the goods traffic of British railways, and reform of the evil has hardly begun yet. When everybody is clamouring to get all he can out of the railways there will be no alternative for them but to get all they can out of the public. Good and well if they first get all they can out of themselves. Not by raising rates, increasing terminal charges and curtailing privileges, but in a much bolder fashion — by reducing the number of half -loaded wagons and half-empty trains. In this direction there are probably pounds to be saved for every extra shilling that can be extracted from indig- nant traders. To correct past errors of over-building and over-competition in " pubHc facilities " is what the crisis most clearly calls for. , Railway transportation in the United Kingdom has become a question of such magnitude and complexity that even professionals may well hesitate to dogmatise upon it. But there are some broad features on which even non-professional judgment may be safely expressed. Of these one of the most obvious is that the economic value of railway operations must depend greatly on the degree of organisation which is brought to bear upon them. The final test of their efficiency and economy is maximum of work done combined with minimum waste of power. By this phrase it is not engine power alone that is meant. It includes the collection and sorting of the traffic as well as the hauling. In fact hauling is the simplest and most uniform of railway operations. The proper loading of trains is much more difficult and demands a great deal more anxious thought than moving them after they are loaded. 86 BRITISH RAILWAYS British railways seem to have been expressly planned to render full and profitable loading as difficult as possible. The main lines intersect each other wherever they have a chance. They never miss a small town on the route that can be reached by a branch line of twenty or thirty miles. To get into a city of any importance they will go many miles out of their way. They build the most expensive stations and depots in decajdng districts where the traffic is evidently on the wane. Thanks to this superabundance of railway routes, stations, terminals, and train services, the traffic, instead of being concentrated at the smallest number of points, is scattered over the largest possible number. Conse- quently it has to be handled in small quantities, so that even one railway could not make a fat living out of it. But wherever there happens to be enough to furnish decent train loads, two or three rival lines are sure to have rushed in to scramble for it. This is the original and fundamental cause of light loading. It lies too deep and goes too far back in our railway history to be easily removed. Certainly no amount of private bargaining between railway companies will produce a sufficient concentration of traffic to ensure pa3dng train loads for several lines even where the traffic is heaviest. CHAPTER VIII ELECTRIC RAILWAYS The electric railway is not merely a great advance on the steam railway, but it is in many ways a new departure. It is more than a new form of traction, it is going to revolutionise railway methods and to upset nearly all the ideas and habits of the old school of railway men. It may also open up a new era in railway economics and finance. So far the electric railway has cost on an average more per mile to build than a steam railway would under ordinary conditions, but against that may be set a number of advantages in working. It can go where no other kind of railway would nowadays be thought of. For underground passenger traffic steam locomotives are no longer conceivable. They will also have to be gradually banished from tunnels of any con- siderable length. In such cases electric traction has become indispensable. In frequency of service the steam railway has been left far behind by its new rival. Out of that advantage will arise several others, both practical and financial. The electric train of from three to six coaches is much more manageable than a steam train of from eight to twelve coaches. It requires less haulage power and less handling. Running frequently, it has more regular loads and fewer empty seats. In proportion to the number of passengers carried it needs a much smaller quantity of rolling stock. Its short trains require only short platforms and less costly stations altogether. An enormous saving can be effected in shunting and making up trains. Electric trains can be nearly always running, 87 88 BRITISH RAILWAYS while steam trains spend a large part of their time in docks or in sidings. Sometimes they cost about as much to keep them standing as to run them. In these various respects useful comparisons may be drawn between the old and the new styles of railway traction. They may help us to discover more definite standards of railway efficiency than the very vague and unsatisfactory ones we have to be content with at present. They will show us how misleading are the popular com- parisons of railways according to their cost per mile of line, without taking into account the number of tracks, the length of sidings, the weight of the metals, and the character of the road bed. Such comparisons produce a bewildering diversity of results which is worse than no result at all. It stands out in violent contrast with the significant uniformity of the returns on capital cost which has been already remarked upon with regard to steam railways. It further confirms and illustrates our opinion that the best test of railway efficiency is the average percentage of return on capital expenditure. On this basis all kinds of railways can be fairly compared with each other. Whether they be single or double lines, heavy or light lines, urban or rural lines does not make any serious difference. If they have been sensibly planned to suit local conditions and well adapted to the traffic they have to carry, there should be approximately as good a return on a £6,000 per mile line as on one that has cost twenty times as much. Conversely, a £100,000 per mile line should earn its dividend quite as easily as the £5,000 per mile one if its traffic is commensurate with its cost. In studying the subjoined tables it should therefore be kept in mind that cost per mile is a meaningless test unless differences in location, structure, equipment and traffic are all taken into account. The Board of Trade returns for 1911 enumerate nine electric railways in London and three in the provinces. They are set out in a group by themselves, and the first point to note about them is their capitalisation. Its nominal total is 63J millions sterling, but of that 2J ELECTRIC RAILWAYS 89 millions is duplication. On the other hand, it should be noted that out of the twelve roads only three were bad offenders in this respect. The Metropolitan Railway is chargeable with £1,425,000 of duplication, and the District with £636,500. The only provincial line with any nominal capital is the Mersey Railway. It has £516,200 unrepresented by cash, but this, as well as the District £1,425,000, seems to be due rather to having to sell new stock at a discount. Neither company has ever been in the happy position of being able to dream about duplication. Electric Railways, 1911. Total Capital, Less Nominal Additions. Total Capital. (OOO'B) Nominal Portion. (OOO'e) Cash Capital. (000-8) Central London City and South London . Great iMorthern and City Waterloo and City . . London Electric . Metropolitan .... Metropolitan District . Metropolitan City Extension Whitechapel and Bow 3 £ 4,390-3 3,011-8 2,084-0 6060 16,419-0 16,677-1 13,143-2 1,000-0 1,575-0 £ 1,424-9 636-5 4,390-3 3,011-8 2,084-0 606-0 16,419-0 15,252-2 12,506-7 1,000-0 1,6750 Blackpool Liverpool Overhead . Mersey 58,906-4 2,061-4 66,845-0 190-0 861-4 3,589-7 516-2 190-0 861-4 3,073-5 4,641-1 616-2 4,124-9 Total 63,547-6 2,577-6 60,969-9 A series of adjustments have now to be made in order to ehminate the more important differences between these roads as regards location, number of tracks, strength of permanent way, density of traffic, etc. The first will be a reduction of the mileage to single track : — 90 BEITISH RAILWAYS Elbctbic Railways, 1911. Mileage of Single Track. 1 Miles of Single Line. Track. Length of Single Track to Miles of Line. Central London . . . City and South London . Great Northern and City Waterloo and City . . London Electric . . . Metropolitan .... Metropolitan District . . Metropolitan City Extensions Whitechapel and Bow . J 7 8 3 2 22 48 26 2 2 21 18 7 4 52 132 65 5 6 3-00 2-25 2-33 2-00 2-40 2-70 2-50 2-50 2-50 Blackpool Liverpool Overhead . 120 8 9 4 309 15 17 10 2-60 1-85 1-90 2-50 Total 141 351 2-50 Electbic Railways, 1911. Capital per Mile op Single Track. Miles of Single Track. Cash Capital, (OOO's) Per Mile. Central London . City and South London . Great Northern and City Waterloo and City . . London Electric . . . Metropohtan .... Metropolitan District . . Metropohtan City Extensions Whitechapel and Bow . } 21 18 7 4 52 132 65 5 5 £ 4,390-3 3,011-8 2,084-0 606-0 16,419-0 15,252-2 12,506-7 1,000-0 1,575-0 209,000 167,300 297,700 151,600 315,400 115,000 192,400 200,000 315,000 Blackpool Liverpool Overhead . . . Mersey 309 56,845-0 184,000 15 17 10 190-0 861-4 3,073-5 12,600 66,700 307,400 42 4,124-9 98,200 ELECTRIC RAILWAYS 91 Even when we have got the mileage reduced to single track the cost per mile varies widely. In London it extends all the way from £115,000 up to £315,000 per mile, while in the provinces the minimum is £12,600 and the maximum £307,400 per mile. A very significant fact is the extraordinary cost of the tubes — ^the latest form of metropolitan locomotion and at present the most popular. The London Electric system has a capital expenditure of £315,400 per mile of track recorded against it — equal to £730,800 for each mile of line. The MetropoUtan is capitalised at little more than a third as much, but its average is considerably lowered by including a large amount of comparatively cheap line in its suburban extensions. The problem of the electric railway in London is unique. Both from the engineering and the economic standpoints it differs widely from the corresponding problem in the provinces. Neither an electric nor a steam railway is ever likely to be built hereafter in the heart of London for less than a quarter of a million per mile of single track or half a million per mile of double track. The pro- jectors of any new metropolitan scheme would therefore have to satisfy themselves beforehand that a fair return could be earned on such an outlay. The average of the existing lines is, it will be seen, much smaller than that — namely £184,000 per mile of single track and £368,000 per mile of double track. That is due, however, to the low average of the Metropolitan Railway, as already explained. When we turn from the striking diversities in the cost per mile of electric railways, both in London and the provinces, to the returns they yield on their capital cost, we find a degree of uniformity as remarkable as was the diversity in capitalisation. No matter what the average cost per mile, the range of variation in the returns is sur- prisingly small. To this there are only two exceptions — the electric railway at Blackpool the gross revenue of which in proportion to its capital cost is fully three times as large as that of the London lines, and the Liverpool Overhead which earns nearly double the London percentage. 92 BRITISH RAILWAYS Electric Railways, 1911. Pebcentage of Gross Revenue to Cash Capital. Cash Capital. (OOO's) Gross Revenue. (OOO's) Percentage of Capital. Central London . . . City and South London . Great Northern and City Waterloo and City . . London Electric . 8 4,390-3 3,011-8 2,084-0 606-0 16,419-0 15,252-2 12,506-7 1,000-0 1,575-0 288-6 184-9 82-5 31-4 759-0 925-2 652-8 80-7 700 6-6 6-1 40 5-2 4-6 60 6-2 80 4-4 Metropohtan District . . MetropoMtan City Extension Whitechapel and Bow . Blackpool Liverpool Overhead . . . Mersey 66,845-0 3,0761 5-4 1900 861-4 3,073-5 37-8 78-9 109-9 19-9 91 3-6 4,124-9 226-6 6-6 On the above table two obvious observations are to be made. First, the percentage of gross revenue to cost will strike the reader as very small. The London average, 5-4 per cent., is a shade more than a shilling in the £. This, remember, is for gross and not for net receipts. More surprising still, the average of the provincial Imes is almost identical with that of the Metropolitan ones — namely, 6*5 per cent, against 5*4 per cent. Out of this meagre proportion the whole of the operating expenses, administration, etc., have to be paid. It may seem wonderful how anything can be left for the owners of the railways and their creditors. But all the lines emerge with a trifle of net revenue. Sometimes it is only enough to pay prior charges, and it never runs to a substantial dividend. This may be the most convenient point to draw a few comparisons — or contrasts perhaps — between the new style of railway and the old. First as to mileage. In England and Wales there are 16,200 miles of railway, equal to 64,576 miles of single ELECTRIC RAILWAYS 93 Electric Railways, 1911. Percentage of Net Revenue to Cash Capital. Cash Capital. (OOO's) Net Revenue, (OOO's) Per Cent. Central London . . . City and South London . Great Northern and City Waterloo and City . . London Electric . Metropolitan .... 3 £ 4,390-3 3,011-8 2,084-0 606-0 16,419-0 16,262-2 12,606-7 1,000-0 1,576-0 122-3 98-9 41-4 15-9 413-1 431-6 344-3 25-8 28-1 2-8 3-3 2-0 2-6 2-5 2-8 2-75 2-6 1-8 Metropolitan District . Metropolitan City Extension Whitechapel and Bow Blackpool Liverpool Overhead . Mersey 66,8450 1,521-4 2-7 190-0 861-4 3,073-5 18-6 24-0 60-5 9-8 2-8 1-6 4,124-9 93-1 2-25 track. Of these only 141 miles, or 351 miles of single track, is electric. Thus the railway of the future is as yet but in its infancy. Second. While the steam railways of England and Wales have cost on an average £22,380 per mile of single track, those of Scotland £17,600, those of Ireland £9,200, and the United Kingdom as a whole £20,600, the new electric lines have averaged in London £184,200 per mile of single track, and in the provinces £98,200. But note that the greatest part of their mileage is under- ground, and therefore exceptionally expensive. Third. As regards cost per mile of single track, even the most costly of the steam railways compare favourably with the electrics. Their highest averages — ^the Lanca- shire and Yorkshire's £27,800 and the Midland's £24,700 — ^are less than a sixth of the electrical average. The over- head average of the nine trimk lines analysed in a previous chapter is only £18,300 per mile of single track, which is less than a ninth of the all-British electrical average (£172,000). The mineral lines in England averaged, as we have seen,^ 1 Page 12. 94 BRITISH RAILWAYS £16,200, and in Wales £20,200 per mile of single track, little more than one-tenth of the electrical average. These few comparisons may give the reader a faint idea of how lavishly capitahsed the pioneer electric railways have been. Most of them have the excuse that they had to commence operations in densely populated areas. This of course necessitated expensive building, and handi- capped the pioneer lines heavily in their competition with the older system of traction. They required proportion- ately large traffics to make them a success, and in this respect they have so far had little to complain of. If we compare the two groups — steam and electric — as aggregates it will be found that the electric earnings per mile of single track are hardly on a par with their capitalisation. In other words, they are not yet living up to their higher standard of cost per mile. Their gross revenues in 1911 compare as follows with those of the steam railways : — Electric Railways, 1911. Gross Revenue Per Mile op Single Track. Miles of Single Track. Gross Revenue. Per Mile. Central London .... City and South London . Great Northern and City Waterloo and City . . . London Electric .... Metropolitan Metropolitan District Metropolitan City Extensions Whitechapel and Bow . . Blackpool Liverpool Overhead . . , Mersey English Steam Railways . . 21 18 7 4 52 132 65 5 5 288,661 184,913 82,559 31,391 759,008 925,228 652,825 80,725 69,985 13,746 10,273 11,794 7,848 14,600 7,000 10,000 16,145 13,997 309 3,075,295 9,952 15 17 10 37,841 78,945 109,947 2,523 4,643 10,995 42 226,733 6,400 351 3,302,028 9,400 41,861 97,145,000 2,320 ELECTRIC RAILWAYS 95 While the capitalisation of the electric railways has averaged about five times as much per mile of single track as that of the steam railways, their gross receipts are only about four times as much. Moreover, this com- parison is imduly favourable to the electric railways in so far as they are for the most part Metropolitan lines, enjoying the finest traffic areas conceivable, while the steam railways are of all kinds, from the poorest to the richest. In order to get an equal comparison steam and electric lines working in the same areas and under similar local conditions should be matched against each other. The North London is the only purely Metropolitan line still worked by steam which is fairly comparable with the tubes, while the London, Tilbury and Southend may be taken as a good example of mixed MetropoHtan and suburban traffic worked on the old system. It corresponds pretty well with the two underground railways, the Metropolitan and the District, which have also a mixed urban and suburban traffic. In 1911 the North London reported gross receipts of £452,694 and working expenses £301,421, leaving £151,273 net. Mileage — fourteen miles of line and sixty-nine of single track. Its gross receipts were consequently £6,560 per mile, its working expenses £4,368, and its net revenue £2,192. The corresponding averages for the London group of electric railways were £9,952 per mile of gross receipts, £5,440 of working expenses, and £4,920 of net receipts. Gross receipts per mile were nearly 50 per cent, higher than on the North London ; working expenses only 12 J per cent, more, and net receipts 125 per cent, greater. The London, Tilbury and Southend makes a still poorer show against the new form of traction. Its gross receipts per mile (single track) in 1911 were £3,134, its working expenses £1,872, and its net receipts £1,262. Compared with the electric group the gross revenue was less than one-third, working expenses also about a third, but net receipts only one -fourth. If we eliminate the tubes from the electric group and adopt the Metropolitan Railway as a standard of comparison, it being, like the London, 96 BRITISH RAILWAYS Tilbury and Southend, partly suburban, more favourable results for the older road are obtainable. In 1911 the Metropohtan Railway's gross receipts were £7,000 per mile (single track), working expenses £3,780, and net receipts £3,270. Gross receipts were 123 per cent, above the Tilbury average, working expenses 100 per cent., and net receipts 159 per cent. After making full allowance for the superiority of the traffic areas in which the electric railways operate, there will still be a large surplus at their credit. Evidently they are much better creators and developers of traffic than the steam railways. Having compared the gross earnings of the two systems, we have next to analyse their working expenses. Electric Railways, 1911. Working Expenses per Mils of Sinqlb Track. Total Miles (Single Track). Total Expenses. (OOO's) Per Mile. Central London City and South London . Great Northern and City Waterloo and City . . London Electric . Metropolitan .... 3 21 18 7 4 52 132 65 5 5 £ 166-3 860 411 15-6 345-8 498-6 308-5 54-8 41-9 7,900 4,790 5,870 3,870 6,650 3,780 4,750 1,100 840 Metropolitan District . Metropolitan City Extension Whitechapel and Bow Blackpool Liverpool Overhead . . . Mersey 309 1,558-5 5,440 15 17 10 19-2 54-9 69-4 1,280 3,230 6,940 42 133-5 3,180 Total 351 1,692-0 4,820 English Steam Railways . 41,861 60,602-4 1,447 The electric railways of England as a whole cost on an average £4,820 per mile of single track to work them, while the steam railways cost only £1,447 per mile. The ELECTRIC RAILWAYS 97 London group by itself shows an average of £5,440 per mile, and the provincial group £3,180. Thus the cheapest electric lines have more than double the rate of working expenses per mile that steam railways show. The London group, which is the most expensive, is not far from four times as high as the steam railway average. Nevertheless the ratio of net to gross earnings is, as will be seen below, much higher on the electric than on the steam lines. Electric Railways, 1911. Net Revenue per Mile of Single Track. MUes. Net Revenue. (OOO's) Per Mile. Central London .... City and South London . . Great Northern and City Waterloo and aty . . . London Electric .... Metropolitan Metropolitan District . Metropolitan City Extensions Whitechapel and Bow . . Blackpool Liverpool Overhead . . . Mersey English Steam Railways . 21 18 7 4 52 132 65 6 5 £ 122-3 98-9 41-4 15-9 413-1 431-6 344-3 26-8 28-0 £ 5,824 5,495 5,910 3,976 7,940 3,270 5,300 5,160 5,620 309 1,521-3 4,920 15 17 10 18-6 24-0 60-5 1,240 1,410 5,050 42 93-1 2,210 351 1,614-4 4,600 41,861 36,543-0 873 The disparities in the above table are remarkable. The steam railway average of £873 per mile of net earnings is less than a fifth of the electric average, and not much more than a sixth of what the London group shows. It is a puzzle how such enormous differences can arise in the earning power of railways, even when they are similarly situated and appear to have almost equal advantages. In London they are due chiefly to the fluctuating volumes 98 BRITISH RAILWAYS of passenger traffic. This, again, wiU furnish us with some striking contrasts between steam and electric traction. The first of the following tables illustrates the passenger traffic of the electric, and the second that of certain steam railways in 1911, Electbic Railways, 1911. Passenger Traffic per Mile of Single Track. Total Total Miles. Passengers. (OOO's) Per Mile. (OOO's) Central London .... City and South London . Great Northern and City Waterloo and City . . . London Electric .... Metropolitan Metropolitan District . . . Metropolitan City Extensions Whitechapel and Bow . . Blackpool Liverpool Overhead . . . Mersey 21 IS 7 4 52 132 65 5 5 37,630-2 24,4050 9,763-6 3,694-6 99,303-2 80,644-2 70,067-4 659-7 21,278-8 1,792-0 1,3560 1,3930 9230 1,9100 611-0 1,0780 1120 4,2660 309 347,336-7 1,124-0 16 17 10 3,0050 11,1321 11,879-7 200-0 656-0 1,1880 42 26,016-8 6200 351 373,353-6 1,064-0 Steam Railways, 1911. Passenger Traffic per Mile of Single Track. Miles. Total Passengers. Averajeper England and Wales . . . North London London, Tilbury and Southend 41,861 69 222 814,850,800 23,759,700 34,400,000 19,466 344,343 155,000 Compare the 347 million journeys made on electric railways in London alone with the 814 million journeys made on steam railways in England and Wales, and try to reaHse what it means to have as dense a movement of population in one small corner of the country as in all ELECTRIC RAILWAYS 99 the rest put together. If we add to the electric railway journeys in London those of the electric tramways, the total will far exceed that of all the steam railways in England. The averages per mile of single track furnish even more striking proofs of the density of London traffic. While the steam railways of England and Wales carried in 1911 less than twenty thousand passengers for every mile of single track in operation, one electric line, the Whitechapel and Bow, carried four and a quarter millions. The respective numbers were 19,463 and 4,256,000. The Whitechapel and Bow is, of course, a very short section of the underground system operating in the most densely populated part of London. No sweeping generali- sation should therefore be drawn from such an exceptional case. But the London electric system, with its fifty-two miles of single track, is large enough to be accepted as a fair test of electric traffic. Its average in 1911 was 1,910,000 passengers per mile of single track as compared with the steam railway average of 19,463 per mile for all England. Nor was the Central London far behind with its 1,792,000 per mile. In the first case the steam railway average is multiphed nearly one hundred times, and in the second it is about ninetyfold greater. The North London and London, Tilbury and Southend, our best examples of steam traction in the metropolitan area, are hardly within sight of the underground lines as regards volume of passenger traffic. The Tilbury's 344,343 per mile of single track is barely a third of the underground average (1,124,000 per mile). The North London passenger business has shrunk so sadly of late that its average is now down to 155,000 per mile. But electric traction may do as much for it as it has done for the tubes. The final test to be applied to the two rival systems will be a comparative analysis of their passenger traffic, including both volume and revenue. The first table gives for the electric group their total number of passengers, total revenue and average receipts per head. The second gives corresponding figures for the steam railways of England and Wales as a whole, and for two 100 BRITISH RAILWAYS typical metropolitan lines, the North London and the Tilbury. Electric Railways, 1911. Passbngeb Rbvbnue per Head. Total Passengers. (000*8) Passenger Receipts. (000*8) Per Head. Central London .... City and South London . . Great Northern and City Waterloo and City . . . London Electric .... Metropolitan Metropolitan District . . . Metropolitan City Extensions Whitechapel and Bow . . Blackpool Liverpool Overhead . . . Mersey 37,630-2 24,406-0 9,763-6 3,694-6 99,303-2 80,644-2 70,067-4 569-7 21,278-8 262-9 172-9 78-6 30-5 711-8 702-9 609-5 77-1 67-6 d. 1-7 1-7 1-9 20 1-7 20 2-1 330 0-76 347,336-7 2,713-7 1-9 3,005-0 11,1321 11,879-7 37-8 76-3 101-6 30 1-7 2-0 26,016-8 216-7 20 373,353-6 2,929-4 1-9 Steam Railways, 1911. Passenger Revenue per Head. Total Passengers. Passenger Receipto. Per Head. England and Wales . . . North London London, Tilbury and Southend 814,850,800 23,769,700 34,400,000 £ 35,264,800 190,450 481,000 d. 10-4 1-9 3-3 Here we have a return to comparative uniformity in the results of the two systems. Widely as they dififer in mileage, in cost of construction, in methods of operation and in the character of their traffic, the two systems arrive at wonderfully similar financial results. The average amount earned per passenger is identical in the London electric group and the provincial group of lines — ^namely, l*9d. On one of the typical steam railways, the North «• » • ELECTRIC RAILWA-Y^.. : 1* •-.• :••. -t^i A London, it is also l'9d. On the London, Tilbury and Southend it is larger — SSd. per passenger — owing no doubt to the longer journeys made by seaside visitors. Li the London group of electric lines two striking anomalies will excite curiosity. One is the very low average fare earned on the Whitechapel and Bow section — namely, 0*75 of a penny, or in plainer English three- farthings ! The other is the abnormally high average shown on the City Extension lines — SSd. per head. This is probably a mere matter of book-keeping, but in any case the amount of traffic is too small to have any material effect on the other averages. This examination of the electric railway accounts for 1911 leaves us strongly impressed with (1) the huge capitalisation they have to carry; (2) their great and growing traffics ; (3) their heavy operating expenses per mile ; (4) their small ratio of expenses to receipts, and finally, the meagre surplus left for the shareholders. CHAPTER IX London's overwhelming traffic Three successive generations of railway engineers have tried different solutions of the baffling problem of inter-urban traffic. The first generation began with what seemed to be the most natural if not the only possible solution — overhead lines. There are many examples of these in London, all dating from about the middle of the nineteenth century. North of the Thames are the North London and the urban sections of the Tilbury line. South of the river are the urban ends of the London, Chatham and Dover, the Brighton line, the South- Eastern, and the London and South-Eastern. All these reach their termini on overhead tracks, while three of them cross the Thames by overhead bridges. The overhead metropolitan system has obvious advan- tages and disadvantages. It is well lighted and well ventilated, consequently it is healthy for passengers. On the other hand, it is noisy and causes a large amount of discomfort to residents along the route. This nuisance has reached its maximum in the elevated railways of New York, which have rendered the streets they traverse almost uninhabitable. From a traffic point of view the overhead railway is non-elastic. It cannot be enlarged except at great expense, consequently it cannot keep pace with the phenomenal growth of metropolitan traffic. A minor drawback from which it suffers is difficulty of access. There is too much climbing up long stairs to suit the taste of modern sybarites. Partly for that reason, when the street tramways came in the overhead railways were deserted in their favour. But in any case their reign would have been over then, 102 LONDON'S OVERWHELMING TRAFFIC 103 as they could not have coped with any large increase of traffic. The overhead railways which had hampered themselves still further with overhead bridges suffered all the more from this additional restriction. As may be seen at the Cannon Street and Charing Cross stations, they had to force their traffic inward and outward through the narrow neck of a bottle. Such an obstruction has this proved in these two cases that the advisability of abolish- ing the bridges and building new terminals on the Surrey side of the river has been more than once mooted. The second solution of the urban traffic problem was the street railway. It has passed through a number of stages, beginning with the horse car and culminating in the capacious but cumbrous electric car of our own day. Like the overhead line, the street tramway is healthy and comfortable. The cars run smoothly and since their electrification they make fair speed. Per contra they are liable to be frequently held up by blocks in the street traffic. The breakdown of a single car throws the whole service on that particular route and all its connections out of gear. But the chief defect of the street railway is the number of breaks and gaps there are in the system. As an electrical engineer would say, it has too many loose ends. This defect is to be seen at its worst in London, but even there it is not incurable. It need never have become so bad as it is but for the jealousies and disputes of a multitude of municipal authorities. If half a century ago London street traffic had been placed imder some kind of central and uniform control, the tramways might not have broken off short as they now do at various points half a mile or more from the great centres of traffic. Such an obvious evil as this is has sooner or later got to be remedied. The growth of the traffic will compel the City authorities to abandon their non-possumus attitude and consent to some arrangement for linking up the Northern and the Southern networks of street railways. The third solution of our street traffic problem is of a composite kind. Almost simultaneously two new 104 BRITISH RAILWAYS methods of transport came in— the underground electric and the motor bus. Up to a certain point they were deadly competitors, but now they are formidable allies. Since the original underground lines of half a century ago were electrified and brought up to date they may be classed along with the tubes among the new forms of metropolitan transport. The latest development is a movement among the newest and most up-to-date railways toward co-operation. A powerful combination of tubes and motor buses has already been formed, and though it has still to give proof of its financial wisdom and stability, it must be treated as an accomplished fact in the urban traffic situation. All the more so as it soon foimd imitators and produced a crop of rival schemes. The Metropolitan Railway Board, fired by the success of the Speyer group of financiers in linking up three tubes, a suburban tramway system and the principal omnibus service with the District Railway, also took the field as a combineer. Its first deal was the purchase of the Great Northern and City — a> rather startling development, especially to the more conservative section of its shareholders. It will not be carried through without considerable opposition, and at fiirst sight it does look a rather far-fetched scheme. But a careful survey of the various surroundings should satisfy any one that they offer ample scope for future extensions and new connections. It would be a compara- tively small matter to continue the Great Northern and City from its present terminus at Moorgate Street on to the Bank. There it could be linked up with the Waterloo and City, and thereby put in communication with the network of suburban electric lines about to be built by the London and South- Western Company. By means of short links the City and South London could be joined up to Waterloo, and the spur line of the Picca- dilly and Brompton tube which now breaks off abruptly in the Strand could be carried to its natural terminus on the south side of the river. When electrification is taken up in earnest all the gaps in the existing network of tubes and street lines will be filled up. A good beginning haa LONDON'S OVERWHELMING TRAFFIC 105 been made by the extension of the Central London to Liverpool Street, where it is now in a position to inter- change trafl&c with the Great Eastern and North London, and through the North London with the whole London and North- Western system. It is impossible as yet to realise the possible results of the great changes which are impending in this quarter. The London and North- western electric line from Watford to Euston and Broad Street, now being rapidly completed, will revolutionise the suburban service of that whole district. It will also give a new lease of hfe to the North London. The Metropolitan Railway has its own possibilities, and all that is needed to realise them is fresh courage and capital. Its natural allies and feeders are the tramway systems of the north-east and south-west of London. Though the former are chiefly owned by the London County Council, there is an independent network con- trolled by the Metropolitan Tramways Company. At the western end of the MetropoHtan Railway is the London United Tramway system. It is already in the Speyer combine, but is not in such a flourishing condition that any scheme for bringing grist to its miU is likely to be discouraged. These two tramway systems dovetail naturally into the Metropolitan Railway and the Great Northern and City, and it would be easy to issue through tickets over the whole of the four systems. This would certainly be a convenience for the travelling public. It would cost the various companies little to carry out, and by degrees it might produce a considerable increase of exchange traffic. By bringing them closer together in their working relations it might also draw them together financially. The logical sequel to these local combinations would be a fusion of the two central companies — ^the Metropolitan and Metropolitan District Railways. All along there have been shrewd suspicions that this was the ultimate goal of the purchasing and joint working campaign. What the Americans once adored as the " community of interest " would be well justified in this case. The wonder is that it was not effected long ago. When it might have been 106 BRITISH RAILWAYS done with the greatest advantage and at the least pos- sible cost the trend of public opinion was unfortunately the other way. Now that it has wheeled round again in favour of fusion and co-operation, no good subject for such an experiment is hkely to be long neglected and there could hardly be a better one than the two sections of the Liner Circle. But to turn from the railway view of London to a broader, humanitarian one is the prospect of the nation being robbed of its best blood and brain in order to build up a modem Babylon so very attractive ? An ever- growing London or a dwindling London, which would be the lesser evil? One thing is certain, that the rate of increase in the passenger movement which was initiated by mechanical traction cannot be long maintained without rendering London intolerably large and unwieldy. It would, in fact, soon become an uninhabitable expanse of noisy and dangerous streets. In little more than forty years the number of passengers carried annually in this densely covered area has multiplied nearly twenty-fold. In 1867 it was under 82 miUions, and in 1910 it had in- creased to 1566 millions. In these forty years the popula- tion has barely doubled itself. In 1867 it was 3,606,000 and in 1910 it was 7,183,000. But concurrently the number of journeys per head per annum multiplied about ten-fold. The respective averages per head per annum were 22-7 in 1867 and 218*5 in 1910. A twenty year comparison will be even more striking in the rate of increase exhibited. In 1891, which may be roughly spoken of as the beginning of the electrical tube and tramway age, the average number of journeys per head per annum was 95*4 — only four times greater than it had been in 1867. Then the great expansion began. During the five years 1891-96, when the first tube— the City and London — came into operation and the electric tramway appeared on the horizon, the average number of journeys jumped up from 954 to 111*3 per head. What may be called the twentieth-century system of passenger transportation went right ahead from 1901, In that year the average was 128*7 journeys per head of LONDON'S OVERWHELMING TRAFFIC 107 the population — almost six times as great as that of 1867. As the new tubes and electric tramways came into opera- tion the annual average rapidly advanced. It was 50 per cent, greater in 1907 than it had been in 1901, and in 1910 it was up another 20 per cent. These four years, 1907 to 1910, made a series of remarkable records. In 1907 the average number of journeys increased by 19*4 per head of the population; in 1908 by 12*4; in 1909 by 2*8, and in 1911 by 14* 1. On the whole four years the in- crease was 39* 1 journeys per head, or at the rate of 10 per head per annum. Movements Uke these indicate more than a mere develop- ment of transportation facilities. They betoken radical changes in the habits of the people which may lead to moral and economic changes of vital importance to the nation. People who make on an average 218 railway or tramway journeys per head per annum — about four per week — must differ in many ways from their primitive ancestors who seldom left home and whose little world did not extend beyond a radius of a few miles. Whether the much journeying and the hurrying to and fro of modern urban life be due to sheer restlessness or to economic necessity it obviously entails great wear and tear of the physical system. Mmor evils are immense waste of time and vast expenditure of money which might be better employed. If we estimate that the 1,566 million passengers carried by rail, tram and motor bus in the year 1910 paid an average fare of 2d., even that small sum would make a total of thirteen millions sterling. The average cost per annum to each of the seven million inhabitants of London for 218 journeys would be £1 I85. 4:d. This includes children and old people, who travel very little. If the calculation were limited to adults the average would be twice as much. For adults alone £4 per head per annum is probably an under rather than an over-estimate. Moreover, the rapid growth of this passenger movement has its alarming aspects. If in little more than the life- time of a generation the average number of journeys per head per annum has multiplied tenfold, what an enormous 108 BRITISH RAILWAYS volume of traffic will the coming generation have to provide for. in- The figures of recent years are simply appallmg com- pared with those of forty years ago. Let us see how they look at intervals of five years, begmning with 1867— AVBBAGB NlJMBEB OF JOIJBNEYS PER HeAD OF THE Population of London, 1867-1910. 1867 1871 1876 1881 1886 1891 1896 1901 1906 1910 22-7 29-7 38*6 56-6 74*9 96-4 111-3 128-7 163'6 218-6 Already our principal streets and thoroughfares are crowded to suffocation with all sorts of traffic. There is no classification, no organisation, no method, and, with the exception of the fixed point policeman, no control. The daily life of the Londoner is a continual struggle with street crowds, railway crowds, theatre crowds, and football crowds. He seldom if ever has room to move about in comfort and safety. He never has peace to enjoy anything or leisure to think out any of the thousand and one problems which beset him. He spends a good half of his time in being whirled around on business or on pleasure. Day after day he is shuttle-cocked between his home and his office without ever finding time to settle down properly in either of them. Can he possibly do his work as well as it used to be done in quieter and steadier days? Merely to grasp the figures which indicate the magni- tude of London traffic requires a strong mental effort. How much more trying must it be to organise and control it. That is fast becoming an almost impossible task. Still more impossible is it to keep pace with its tremendous growth. The day has long passed for replanning metro- poHtan roads and railways. They are now too confused and interlaced ever to be straightened out again. The worst places may be rearranged, but the maze of underground, surface and overhead railways will in all probability have to remain very much as it is. Not only have most of them been laid out on wrong lines, but the few really good schemes which have been put forward were either mutilated in Parliament or LONDON'S OVERWHELMING TRAFFIC 109 absolutely rejected. This has been the special misfortune of projects for linking up the railway termini with the docks and wharves on the river. The present generation has seen two of these defeated by combinations of opposing interests and local jealousies. The latest and best re- membered was the Greater London Railway of 1911, which proposed to envelop North London in a huge semi-circle extending from Felton in the west to Tilbury in the east. Its wide sweep was to embrace Isleworth, Wembley, Kingsbury, Hendon, Finchley, Friem Barnet, Wood Green, Southgate, Tottenham, Walthamstow, Ilford, Romford, Dagenham, Hornchurch, Upminster and the Ockendens North and South. This grandiose scheme encountered a torrent of op- position from District Councils, Borough Councils and other local authorities which proved too much for it. But the check it has suffered may be only temporary. Its chief interest for us lies in the illustration it affords of the difficulty of getting any large scheme of metro- politan transportation considered on its merits and judged from its own proper standpoint. Even from that stand- point the Greater London Railway was a rather dubious scheme, but however good it had been in itself it had obviously no chance against the phalanx of mimicipal objectors who rushed down on it. A much more feasible Outer London Railway was pro- posed nearly thirty years ago and also rejected. Or it might be more accurately described as having fallen still-bom. Fully half a million sterHng was lost over it, so that instead of helping to solve London's traffic problem it postponed the solution for at least a generation. Never- theless it is almost as certain as anj^hing can be in the life of a great city which prefers to live from hand to mouth, that the railway in question will sooner or later have to be built. It was known as the Regent's Canal, City and Docks Railway — a name now probably forgotten by nearly all who have not painful cause to remember it. This railway was much less ambitious than the Greater London of 1911. It took a much smaller sweep to the north of the Thames, and was consequently nearer the no BRITISH RAILWAYS centre of metropolitan traffic. It had the advantage of an open route well defined and a clear right of way secured for more than three-fourths of its entire length. Starting from Paddington it would have followed the course of the Regent's Canal to Victoria Park. Then, instead of going down to the Limehouse Basin, the river terminus of the Regent's Canal, it would have diverged to the north-east along the Hertford Union Canal. This line it would have followed as far as Old Ford, and then have struck away to the south-east. Running through Strat- ford and Canning Town it would have ended at the Victoria and Albert Docks. That this still-born railway would have been an im- mense boon to North London as well as to the river trade can no longer be disputed. It would have brought the docks and all the northern railway termini — King's Cross, Euston, Marylebone and Paddington — ^into direct connection with each other. These termini were all to be joined up to it, and they need never afterwards have put a ton of import or export freight on the public streets. It would also have reheved the blockade of their City lines with goods and mineral traffic. If the railway shareholders of 1883 had had the faintest idea of where their true interests lay on that occasion they would have insisted on the Regent's Canal, City and Docks Railway being heartily supported by their directors. But they were as usual blind and apathetic. They did not dare " to speak to the man at the wheel," and he as usual did as he Hked. What he did was the worst possible thing for his shareholders as well as for the public. He would not part with an ounce of his dock traffic so long as he could keep it on his own line, however circuitous and inconvenient that line might be. Even when he had to part with it before reaching the docks, he would give it to any one rather than to a new railway which fore- shadowed possible competition somewhere or other. In short the directors and managers of the northern main lines played dog in the manger to the new project, which offered them the best and cheapest connection they could possibly get with the docks and the river LONDON'S OVERWHELMING TRAFFIC 111 Thames generally. If they had approached it in an impartial business spirit they would have had no difl&culty in making terms. It was quite well known that carting goods across London, say from Paddington to the docks, cost on an average 45. per ton. Sending it by circuitous railway routes, most of which involved a certain amount of cartage, would not be much if any cheaper. Taking into account the imconscionable delays and waste of time which the round-about routes involved, it might even be dearer. That the proposed railway could do their work better, quicker and cheaper than any existing service these conservative managers could not have denied. Rates were offered them which would have meant savings of thousands a year. They might have contracted before- hand for all their import and export freight at half the cost of cartage if they had been willing to guarantee a reasonable amount of tonnage per annum. One or two of them were willing to do this, but the others were scorn- ful. The Great Western was the most discouraging. It suggested sixpence per ton as a maximum through rate, which would have been less than a halfpenny per ton per mile. The Great Northern was the most liberal of the main lines, in fact, the only one that showed any breadth of mind at all. Notwithstanding all these dampers and discourage- ments, the promoters of the Regent's Canal, City and Docks Railway made a gallant attempt to raise the necessary capital. Li February 1883 they issued a prospectus for £1,275,000, out of which it was proposed to pay £1,170,485 for the existing stock of the Canal Company. The stock-holders were given the option of taking new stock for old at the rate of £130 new for £100 old, and most of them to their subsequent sorrow made the exchange. The new company guaranteed them 4 per cent, until the 31st March, 1888, and 4 J per cent, in perpetuity thereafter. But the guarantee broke down before it was four years old. In 1887 only 3 per cent, was forthcoming, and in the two following years there was a further drop to 2J per cent. 112 BRITISH RAILWAYS The old canal shareholders found themselves severely punished for attempting to render a valuable service to the public. Before the railway scheme was started they had been receiving a comfortable dividend of 5 per cent, on a capital of £996,000. The railway financiers watered their capital about 30 per cent, and cut down their dividends one-half. In the end they had to let the railway go and resume possession of the canal. But heavy as their loss was, that of the public was infinitely greater. Had the railway been built as was proposed in 1883, it might by this time have been not only earning good dividends, but effecting large economies in the cost of transit traffic through London. It might also have been acting as a check on labour unrest so far as the dockers and bargees are concerned. The fate of the Regent's Canal, City and Docks Railway has one more important moral for us. Its promoters were blackmailed to a scandalous extent in expenses. The parliamentary deposits alone cost them £310,000, and other charges were in proportion. The company's posU mortem balance sheet showed a debit of over £600,000. The Greater London Railway Bill has probably been almost as costly a venture for its financiers. Need we wonder if a good outer-circle railway has still to be built ? The task has to be approached in a very different spirit from that of the Parfiament and the railway managers of 1883. It will never be properly executed imtil the pubhc necessity for it is fully recognised, and all who are to benefit by it show their willingness to treat it at least fairly if not generously. BOOK THIRD— TECHNICAL CHAPTER X THE GOODS SERVICE In Chapter III a full description has been given of the work done by British railways. In continuation of that we have now to see how they do it. This involves an examination of their principal services. Of these the most important, both in respect of earning power and of public benefit, is the goods service. It has not hitherto held its proper place in our railway economics, and still less in the estimation of our railway managers. The fascination which the showier forms of railway enterprise have exercised over them may accoimt for the excessive attention they have bestowed on passenger expresses, with their luxurious and costly encumbrances of sleeping cars, drawing-room cars, dining cars and smokers. The true earning power of such trains is generally in inverse ratio to the elegance of their fittings and the splendour of their upholstery. It is the well-loaded goods train and not the magnificent sixty-mile-an-hour express that keeps a railway going. If it depended on the drawing-room car, both the car and the railway might soon be for sale. The keynote of modem railway administration is the supremacy of the goods service. Where that is recognised and acted upon there will be a clear road to success. Where it continues to be ignored and neglected as it has been in the past there can be no solid progress ; there is more likely to be retrogression. On all our trunk lines " full train loads " is now the motto, but even they cannot always hve up to it. At metropolitan depots and in I 113 114 BRITISH RAILWAYS large centres of traffic throughout the provinces express goods trains can be loaded from end to end and dispatched all over the country two or three times a day. They can be run on regular time-tables, and almost at equal speed with the passenger expresses, of which they are a questionable imitation. Even second and third-rate manufacturing towns in the north have now their through goods non-stop ex- presses. The latest evolution of these appears to be on the North British Railway, where the whole system is gridironed with them. Carlisle receives no less than eleven of them daily from various points at the northern ex- tremities of the system. Five come from Glasgow and the west of Scotland, three from Dundee, and one each from Edinburgh, Falkirk and Grahamstown. On the east coast Newcastle is quite as liberally, not to say lavishly served, and one of these expresses runs right through to King's Cross. Of course there are correspond- ing return trains both from Newcastle and Carlisle. The speed records of most of these " through goods " expresses are noteworthy. The Sighthill (Glasgow) to Newcastle leaves at 9.30 p.m. and arrives at 7.10 a.m. next morning, doing the 175 miles in nine and a half hours. But that is slow going compared with the Glasgow to Berwick and the south. It starts at 7 p.m. daily except Saturday, and with a thirteen-minute stop at Niddrie Jimction, runs right through to Tweed- mouth, where it passes on to the North-Eastern system. This 104 miles is done in 185 minutes, or, deducting the thirteen-minute stop, 172 minutes. From Tweedmouth it rattles on to York, and thence to King's Cross, where it is due at 6 a.m. on the following morning. The time for the through run is exactly eleven hours. The reverse train from Berwick to Glasgow starts at 6.35 a.m., and makes a non-stop run to Niddrie Junction, 53 miles in 80 minutes. From Niddrie it goes right through to Parkhead, 46 miles in 99 minutes, and enters the College goods station, Glasgow, five minutes later. The running time for the whole journey from Berwick to Glasgow is 2 hours 4 minutes. The fastest passenger train on the THE GOODS SERVICE 115 same journey takes about two hours and a half, so that in this case goods travel quicker than live freight. An- other crack goods train on the North British uses the Waverley route. It does the 98 miles in 3 hours and 5 minutes with thirty loaded wagons : the best passenger time being only half-an-hour less. Taking the North British as a typical line, these " through goods " expresses differ very little from non- stop passenger flyers. They have to be engined and braked quite as expensively, and quite as much care has to be taken in running them. If a comparatively small system like the North British can find work for about a score of such trains, how many of them are there likely to be on the great trunk lines like the North- Western and the Midland ? The total number running between the chief provincial cities of England should probably be reckoned by hundreds. Whether they all pay is an open question. If the data for answering it were available it would be a most important point to determine. In their favour is the fact that as a rule they will run with full loads. That will probably more than counter- balance the extra cost of their fast running and their expensive maintenance. It may easily happen that the local goods trains are less profitable than the " through goods." They labour imder the most serious drawback that goods traffic can have to contend with — flight loading. It may seem a paradox that local goods traffic should tax the skill of railway officials more than the long-distance traffic, but a very slight study of the working conditions in the two cases will show why it is so. Short-distance traffic has to be collected in small quantities from station to station. It travels as a rule in wagons which may not be half or even one-third loaded. It runs at slow speeds and with frequent stops. Both the train itself and the goods need a great deal more handling, and that is an expensive item in freight movement. Speaking without definite data as to the profitable character of the principal classes of goods traffic, we might venture to say that the " through goods " expresses pay best because of their full loading. In that respect 116 BRITISH RAILWAYS they have an analogous advantage to the excursion train, which may often pay through sheer force of numbers. The local goods traffic, even when most carefully and economically worked, is so expensive that it must often be unremimerative. We are still more sceptical as to the parcel business of the railways in which they so foolishly compete with the Post Office. On the face of it sending a van to coUect a small parcel, carrying it a hundred miles, and sending out another van to deliver it — ^all for the small charge of sixpence — ^is not getting ninepence for fourpence, but the other way round. It took our railway managers a good many years to discover that full train loads are the secret of success in modern transportation. They cannot always get them either in their goods or their passenger business. For every full train they run a dozen go out half empty. For the public as well as for the railway the full train is best, because it not only gives the quickest service, but it is generally the cheapest. Railway managers are therefore to be encouraged to make the full train their motto. It is an undoubtedly good motto, though it was borrowed from the United States along with many other less obvious innovations, as, for instance, ton-mile statistics. There may be wide differences of opinion among practical as well as among theoretical railway experts as to the best test of loaded trains, but the fidl train load itself is an indisputable axiom. It is gratifying to observe that railway officials are beginning to appreciate its importance, and even the men cannot avoid taking an interest in it, though they consider it contrary to trade union principles. One of their chief grievances during the strike of 1911 was that heavier trains and more powerful engines enable the railways to do more work with fewer hands. That is unquestionably true, and justifiable to boot. It is the natural and legitimate answer of worried capital to mutinous labour. But for fuller and fuller train loads the railways could never have stood up as they have done to the incessant attacks of the trade unions in the past decade. The full train load is the crux of railway efficiency and THE GOODS SERVICE 117 success. It is the crucial problem of the modern railway manager, and there can be no more interesting or in- structive study than the innumerable methods by which he tries to solve it. The latest solution in use is the " tranship " method, by which small consignments from country stations are passed on to " tranship " stations until a pa3dng load is obtained for every wagon travelling any distance. This system requires to be very methodi- cally carried out, and a multitude of strict rules have to be laid down for its regulation. Consequently it is not popular with either station agents or their staffs. A writer in the Great Central Railway Journal for April 1911, who has evidently studied the subject from the inside, says — *' Local conditions vary and difficulties often arise of which headquarters staff know nothing. The station staff have to cope with the trouble, and should not be tied up with frivolous instructions." At the same time he admits that the station staff cannot be left entirely to themselves. Men are often inclined, he says, to send a wagon away empty if it means work in gettmg it into position. The present system of obtaining the average load dispatched from each station is not, in his opinion, satis- factory. He would substitute for it a daily statement showing the average load for local, foreign and road wagons, specially noting light loads and the reasons for same. It should also state what foreign wagons have been sent away empty. By this means he thinks it would be possible to put a finger on the weak spot at once, and not, as is now often the case, in a few months' time. That last sentence embodies the unconscious verdict of a practical railway man on the ton-mile theory. Before ton-mile figures for a given month can be got out and put in proper shape to submit to the General Manager, it may be well on into the following month. To this official objection the ton-mile theorists have never yet been able to return a conclusive answer. Then there is a still more practical objection put forward by the men who have to work the traffic. Speaking for them, the writer in the Great Central Railway Journal says — 118 BRITISH RAILWAYS " Whilst at some stations it is possible to maintain average loads of three to four tons (per wagon), there are many which find it impossible to get even two tons. Varying traffic is responsible for this, and it is difficult for a foreman, however good, to follow out his many instructions as to getting traffic to destination promptly and at the same time preventing light loads." The " tranship " system he regards dubiously, but his opinion of it has evidently been formed at second hand. It is therefore not of great value, though it may deserve passing notice. Some companies, he observes, have en- deavoured to prevent light loading by means of " tranship stations " with varying results, although the balance of evidence seems to be more or less in their favour. Alto- gether light loading is a difficult problem in connection with local goods traffic. Where it is impossible to obtain full loads the railways have a certain amount of justifi- cation for charging proportionately higher rates on such traffic. Before the advent of the road motor they often did penalise short-distance traffic, but now that there is an effective check on them they will be wise to conform to the new motor rates even if they leave very little profit. On long-distance traffic, and especially on through traffic exchanged with other railways, the " tranship " system may become very valuable. On certain trunk lines it has been most elaborately organised, and minute instructions are given for its operation. It is being carried out most thoroughly perhaps on the London and North- Western, which no doubt borrowed the idea from its American friends. Since 1905 there has been in use on the London and North- Western a book of " Instructions as to working of road vans and tranship traffic." It is a volume of over a hundred pages, in which aU the start- ing-points of regular goods trains are arranged alphabeti- cally. Under each starting-point are shown the various trains and their destinations, also the stations served by them. It explains where traffic is to be picked up or exchanged or transferred, where through loads are to be made up, where tranship wagons are to be attached to THE GOODS SERVICE 119 a through train, where goods are to be sent on by pas- senger train, where they are to be carted from one station to another in order to go forward by a more direct route, where they are to be shunted in order to fill up with local goods, and innumerable other directions. The object of these minute regulations is evidently twofold — ^first, to keep a check on half -loaded wagons, and secondly to minimise the risk of goods going astray. WTien a consignee lodges a complaint about missing goods, the official receiving the complaint can tell at once by what route they should have travelled, and where they should be at a given time. He knows where to start making inquiries about them, and the chances are in favour of their being quickly traced. This is a point on which our railway managers may plume themselves. Compared with foreign railways their percentage of lost goods is very small, and the percentage of recoveries very large. The writer had this fact strongly impressed upon him while travelling in the western States. Wherever he broke his journey he found the baggage-room in a high temperature owing to complaints about missing baggage. The American freight department is also unlucky. Consignments go astray and are often lost for weeks. Where they are urgent special precautions have to be taken against delay. In the case of a large shipment with a long distance to travel the railroad imdertakes to advise the consignee day by day of the point it has reached and how it is proceeding. On British railways, and especially on those where the " tranship " system is well developed, no such special arrangements are needed. If the regulations laid down in the " tranship " book are faithfully observed, goods should travel almost as methodi- cally as passengers, and should reach their destinations almost as punctually. In a brief preface to the " tranship " book of the London and North-Western Railway, general instructions are given as to the loading of goods traffic, the use of road vans, the amalgamation of loads, etc. The idea of transhipment is to separate through traffic as far as possible from local. The former is to be sent forward 120 BRITISH RAILWAYS by the regular through trains to its proper " tranship '* station, while the latter is to be carried by road vans serving the intermediate stations. The first sentence in the regulations says — " The agent at a station which starts a road van for delivery at various destinations will be held responsible for seeing that it is fully and properly utilised, and for reporting to his District Goods Manager any case of light or unnecessary running or other irregularities." No road van is to start with a load of less than 15 cwt., unless it is specially authorised by the District Goods Manager, or is the only van covering a certain section of the line, in which case it must run daily irrespective of weight. The last clause deserves to be taken note of, as it lays down the wholesome principle that every section of the London and North-Western Railway is to have at least one goods service daily. When a road van on reaching a " tranship " station has less than 15 cwt. of a load, it must have its load increased if there be goods available for it. If not it must unload at the " tranship " station, so that goods for competitive points may go forward by a tnrough train the same night. Even separate stations in the same town and separate loading depots or sidings at the same station are required to co-operate in the amalgamation of loads. Every effort, it is said, must be made to amalgamate loads for the same destination, either by carting or by using partly loaded wagons, that is, wagons provided at one part of the station for conveyance of goods accumulated at another part. The station agent is of course an important person in the carrying out of these regulations. He has not only to supervise his staff, but he has to educate them. Qause 13 of the general instructions says that " agents are held responsible for seeing that their foremen checkers and loaders are educated as to the proper usage of foreign wagons, selection of suitable vehicles, and the standardisa- tion of loading for particular classes of traffic, also as to the method of starting and building up the loads so as to secure wherever possible (consistent with safety) THE GOODS SERVICE 121 loading to the maximum carrying capacity of the trucks." They have further to watch and report cases where light or duplicate loads are received from local stations, as well as instances of duplicate or light loads of unimportant traffic being received from foreign lines. In short, the station agent is expected to be Argus- eyed. He is not only to have a himdred eyes, but he is to keep turning them in all directions, watching not only his own staff but his brother agents. The misdeeds and irregularities of foreign lines have to be duly recorded in his daily reports. Between District Goods Managers who may not be exactly sweet-tempered, and checkers who are often cantankerous, the poor station-master cannot fail to have some bad quarters of an hour. He would be an angel if he took in the official organ of the National Union of Railwaymen and could read without a blush what his head porter or possibly the lamp-cleaner says about him at the Sunday meetings of the local branch. He may now hope, however, that less of that trade union insolence is to be tolerated hereafter. All the companies had allowed it to be carried to a disgraceful length, but now apparently some examples are being made of the worst offenders. So much to the good for the long-suffering station agent. It is due to our railway managers, after the severe but not always intelligent criticism that is poured out on them, to acknowledge that they are at last beginning to appreciate the scientific side of their work. Many of them are appljdng themselves earnestly to the economical working of their goods traffic. The many complex questions involved are beginning to receive systematic consideration. American methods are being studied with an open mind and a readiness to admit that they are sometimes ahead of our own. But on the threshold a serious obstacle is encountered in the fact that the British and American methods of handling freight differ fimdamentally. A few examples will suffice to illustrate and enforce this oft-forgotten truth. Our railways not only trans- port goods by rail, but they collect and deliver them. 122 BRITISH RAILWAYS American roads only haul them from station to station. Collection and delivery charges have therefore to be eliminated from our rates before they can be fairly com- pared with American rates, which cover only haulage from station to station. The ton is the invariable unit of charge on heavy shipments, whereas American shippers can have special rates for five-ton lots, car loads of 30 to 50 tons, or train loads of from 800 to 2000 tons. Freight rates in America include forty-eight hours' demurrage, which is so much free warehousing to the consignee. He has it extended when the railroad can do so without inconvenience, and goods are often re- shipped from a freight depot without having been touched by the original consignee. For these facilities American roads make no extra charge, while British railways start at once with a charge for terminals ; they are also more strict in levying demurrage, and British freight as a rule has to undergo a larger amount of handling than American. " Accommodation Sidings " are much more liberally provided by American than by British railways. Every factory or warehouse of any importance has one. Manu- facturers and merchants are encouraged to locate them- selves close to railroad tracks, where they can load and unload on to their own sidings. They lease sites from the railroad company at nominal rentals, and put up their own buildings. The sidings are generally also rented, and some of them are miles long. Not only do shippers thereby escape terminal charges, which on our short hauls may be 40 or 50 per cent, of the rate proper, but a much larger saving is effected in handling the freight. The dray work in New York is not half so troublesome as in London, though the bulk of the freight in transit must be considerably greater. The method of operating freight trains in America may also deserve more consideration than it has yet received from British managers. It differs radically from the British method, and if a fair experiment could be made with it on a British line, it might be found more THE GOODS SERVICE 123 economical. An ounce of fact is worth a ton of theory in railway work as in all other practical walks of life. But any railway making the experiment would have to be prepared for a complete reorganisation of its traffic department. It would have to transfer one-half of its goods porters from stations to trains and dispense with the other half. Each train on the American principle would have a complete working staff of its own — " crew " is the technical term — and be able to load or unload freight at any point without local help. A " train crew " consists of driver, fireman, conductor and two or three brake-men, who act as travelling porters. A train thus manned can run into a station, deliver freight and pick up new freight without seeing any one but the station agent or his deputy. Through trains call only at principal stations — " division points " — which may be 100 or 120 miles apart. " Local freights " calling at all stations do the local business, and also pick up through freight, which they carry to the calling stations of the through trains. This, it will be seen, is a more elastic system than ours, and under better control from a labour point of view. Goods porters have not to be kept at stations where they may be needed only now and then, or where they may have only a few hours' work per day. A " train crew " is bound to be always in full work. When required an extra train may be put on — complete in itself like all the others. In the reverse case a train can be taken off or its trips may be rearranged in order to give it full employment. All this can be done without refer- ence to the station staffs, which compared with our own are very small. The issue to which we invite the attention of British railway officials is between stationary freight handlers and travelHng freight handlers. Whether can a given quantity of freight be moved quicker and cheaper by the one system or the other ? Prima facie, if goods porters be distributed along the line at fixed points, each fixed point will require a maximum supply of them. Unless they are to be at times greatly overworked, their number must be in excess of normal requirements, which can 124 BRITISH RAILWAYS never happen with a train crew. The latter can be in- creased or diminished at pleasure ; trains may be put on or taken off at an hour's notice. Economy of labour would seem to be decidedly with the Americans. To give the ** train crew " system a fair chance on a British railway, collection and delivery would have to be abolished along with the extra porters at goods stations. It might work pretty well without that change, but it would work much better if shippers were to do their own collection and delivery, as in the States. Here, too, economy of labour is possible, and, what would be a still greater boon, heavy traffic on the streets might be re- duced. Instead of every railway having its own cart- age outfit — sometimes overworked and at other times underworked — one or two agencies might act for them all. Our street traffic would thereby be immensely relieved, with better service rendered at the same time to traders. The public if not the railways, but probably both, would gain by putting the railway companies back as near as possible into their original position of traffic haulers. In course of time all the irritating questions of terminal charges and cartage rates might be got rid of. The railways, if restricted to their proper business of hauling freight from station to station, could simplify their work immensely. As a natural consequence they might be able to do it better and more economically. A traffic manager, who, instead of having his mind dis- sipated over a score of side questions, could concentrate it on the single problem of how to move a train load of goods over a given distance at a minimum cost might discover possibilities of economy undreamt of hitherto. That problem, which is the true railway problem, and the basis of all transportation systems, calls impatiently for solution in this country. Far from being solved, it is only beginning to be realised. In the United States it is being eagerly studied, and that is the secret of the remarkable progress the American railroads have made in the past decade. Our railway officials are too often hampered by the cast-iron rules they work imder, which THE GOODS SERVICE 126 leave very little room for original thought or initiative. Nevertheless one occasionally meets in the railway press with startling suggestions. In the Great Western Railway Magazine for August 1912 Mr. F. W. French of Helston throws out quite an American idea. The present system of station truck working he truly declares to be antiquated, and he asks if there could not be substituted for it a sorting train which would entirely eliminate road-side work. The idea has evidently been suggested to him by the Post Office sorting van arrangement. It would, in fact, be an adaptation of the letter-sorting method to parcel and light goods traffic. At the same time it would be an approximation to the " train crew " system of the American railways. I have already observed that this would be an experiment well worth trying. CHAPTER XI THE PASSENGER SERVICE The fundamental problems of goods traffic and of passenger traffic are practically alike. It is the full train load that governs both. But very different solutions are sought for in the two cases. In the goods service direct business-like methods are taken to secure as full a train load as possible. Small consignments are amal- gamated at successive points on the route until they reach paying quantities. There is reason to believe that this policy when carried out with energy and intelli- gence produces very satisfactory results both for traders and shareholders. It is therefore all the more surprising that exactly opposite methods should be applied to the passenger service. Instead of trying to fill up their regular trains, railway managers when they want a full train load advertise a special excursion to some popular resort. Instead of charging the regular fare for these excursions they offer tickets at a hali, a third or even a fourth of what regular passengers have to pay. This practice is now almost peculiar to British railways. It never attained in any other coimtry the absurd development which it has received here. What there was of it in other countries is being given up, and a gradual return is being made to the original principle of flat rates. On the State railways of Germany not only have excursion fares, circular tours and all other special rates been abohshed, but return tickets have been withdrawn. This was done, however, in such a way that the public gained rather than lost by the change. Wherever a return 126 THE PASSENGER SERVICE 127 fare was abolished the two single fares were reduced to the level of the old return fare. Thus where the single ticket had been a shilling and the return eighteenpence, the single ticket was reduced to ninepence. The ultimate effect of the readjustment was that the Grerman State railways have now a perfectly simple and uniform tariff based on mileage. They charge the lowest rates possible for each class, and every passenger pays so much per mile no matter whether he travels five miles or five hundred. Many British tourists, in happy ignorance of this change, continue to arm themselves beforehand with circular tour tickets. The reduction they obtain on them is purely imaginary, as the price charged is simply the sum-total of the separate fares. In fact they get a separate ticket for each section of their journey. This truth may be brought home in a rather unpleasant way to tourists who try to get circular tours at a German railway station. In the first place you will most likely be told that the circular tour office is somewhere outside. When you find it you will be confronted with a row of military-looking officials. After humbly explaining to one of them where you wish to go and by what route, you wiU be silently and severely handed a printed form to fill up. If you should look particularly bewildered, or if the clerk is in unusually good humour, he may refer you to a big book lying on a table in the middle of the room. This is a dictionary of fares far more formidable than the British Bradshaw. The first glance at it inclines you to throw up the sponge and return to the railway station determined to pay as you go. At that moment a benevolent German takes pity on your distress and shows you how to fish out the details necessary to make up your Rundreise. For every separate section of it you have to find the mileage and the fare, and enter them in the proper place in the schedule. Having laboriously collected and entered them all and added up the amounts, you return the form to the official Cerberus, who with a stony look accepts your money. If you should fondly imagine that you are going to get your ticket on the spot you will suffer another disappointment. 128 BRITISH RAILWAYS He will probably tell you to return in the evening about a quarter of an hour after the last night train has gone through. It is useless to argue with him, still less to appeal to his magnanimity. You will not get your circular ticket a moment earlier than the appointed time, and when you get it you will discover that you have wasted a day for nothing. You might have gone on in the morning paying the local fares all the way roimd, and come out even on the transaction. In short, the German Bund- reise-hillet has degenerated into a huge Teutonic joke. Why it was not abolished altogether on the introduction of the new single fare system I cannot guess. Perhaps it was retained in order to demonstrate by contrast the sweet simpHcity of the uniform mileage rate. The latter is certainly a good thing in itself, and is popular with the Germans, as it will also be with British tourists when they begin to understand it. In the United States a similar reversion to uniform fares has also taken place in the past few years. Special fares are granted only for special occasions, such as political conventions or public conferences . Then they are hedged round with limitations as to routes and length of time available. Excursions are frequently organised by Societies or private speculators, but seldom by a railroad company on its own account. Almost the only privileged fare that survives is the thousand-mile ticket, which was the original model of the strip ticket now extensively used on tramways and tube railways. These are rational and equitable forms of commutation, but unfortunately the attempt to introduce them in this country has been an indifferent success. The only railway, I believe, which now issues thousand-mile tickets is the North- Eastern, and even it does not push them much. The strip ticket is chiefly used for workmen's trains, for which also weekly tickets can be had. The standard form of commutation on British rail- ways is now the season ticket. It is imiversal on metro- politan lines (with the exception of the latest tubes), and also in provincial cities. It is pecuharly suited to the THE PASSENGER SERVICE 129 enormous masses of suburban traffic which have now to be dealt with morning and night. It is difficult to see how they could be handled in any other way. The issuing and checking of nearly a million tickets twice a day would be physically impossible. But necessary and convenient as the season ticket may be, it is a very rough-and-readv way of charging for the transportation of passengers, it may mean to one passenger a single journey per day, to another two, to another three, and in fact anything up to spending a whole day on the train. If the actual journeys made in a week by half-a-dozen season ticket holders with the same class of ticket were reduced to mileage, it might be found that A had travelled twice as far as B, and B three times as far as C. But all had paid the same price for their tickets, so that while C's fare worked out at a halfpenny per mile, B's might average only a farthing per mile, and A's an eighth of a penny. This is not only a very random method of charging for transportation, but it involves a great deal of unfair discrimination between passengers, and in many cases heavy loss to shareholders. There is no pretence of scientific basis for it. It acknowledges no standard either of equity or value. Season ticket rates are notoriously arbitrary and capricious. There is not a word to be said in their favour, except that they are very simple and easily worked. Consequently they give little trouble either to the ticket holders or to the railway officials. That is their one merit, and it is dearly bought at the price of inequality and fraud. But if the season ticket goes too far in the direction of absolute uniformity, our railway managers restore the balance by the multiplicity and diversity of their ordinary fares. On the Brighton line one may get a first-class season ticket for about £40 a year, and if he uses it twice a day — that is, up and down — ^the total journeys made in a year will be, say, 626. Their average cost will be under Is. 4:d., or little more than half of the lowest fare charged to a cheap tripper, and less than a third of the ordinary parliamentary fare. The time-honoured adage about making a reduction 130 BRITISH RAILWAYS on taking a quantity is not to be lightly spoken of, but in this instance it is surely being carried too far. The first-class return fare from London to Brighton is I65., and 313 return journeys would cost at that rate £234. The " discount on taking a quantity " is therefore about 90 per cent. Either that is an unreasonable reduction to give to the season ticket holder, or the ordinary return fare is unreasonably high. There is no visible proportion between the two, and no principle can be discovered in the fixing of them. Neither of them bears an intelligible relation to the other, and still less to the hundreds of other fares chargeable on the Brighton Railway. The sug- gestion that there should be any relation between them would possibly excite surprise in railway board-rooms generally. Previous to 1888 freight rate books were the standing puzzles of British railway administration. They were then reduced to comparative order and inteUigibility. Though they are not yet by any means perfect, they shine beside the Babel of passenger fares that are still in force. There is hardly a town of any importance in the three kingdoms but has five or six different prices to pay for the transportation it purchases from the local railways. A resident in one of them who makes a journey on Monday is probably charged full third-class fare, say 10s. For the same journey on Wednesday he may get the benefit of the weekly cheap trip, and so save 4s. or 5s. For a week-end ticket he may have to pay 8s. In summer he may have a tourist return good for a month for 6s. When the excursions are on he may have a large choice of them two or three times a week for half-a-crown. Until one goes to London Bridge or Liverpool Street or Victoria, he can never guess what the cost of his projected trip is to be. It varies not only with the days of the week, but with the time of day. The same journey may be 50 per cent, less in the afternoon than it would have been in the morning. To go to the same place may cost 20s. on a Friday night and 30s. on any other night. These are eccentricities of our passenger service which no one can account for, much less justify. They have grown THE PASSENGER SERVICE 131 up with the system, and become so firmly embedded in it that it will need a very hard wrench to pull them out. It is surely a peculiar irony to find such absurdities flourishing in the home of the penny post and the sixpenny telegram. For a counterpart of our passenger fares in the year 1913 we have to go back to the protectionist tariffs of a century ago with their twelve hundred and odd classes of dutiable imports. What curious affinity can there be between the up-to-date railway booking- office of to-day and the antiquated Custom House of a century ago ? Smart railwaymen may jeer at the old- world fiscal tariffs who never suspect that their own passenger tariffs are framed on the same model. They are divided and sub-divided in the same arbitrary way, overloaded with unnecessary differences and distinctions, and made as puzzling as possible to distracted passengers. It is in the concoction of needlessly differentiated return tickets that the perverse ingenuity of the modern ticket clerk shines most conspicuously. Not content with creating unnecessary variations in the fares themselves, he further muddles them up by making them valid for two, five, eight, fourteen or sixteen days as strikes his fancy. He evidently sees a difference wluch is perceptible to nobody else between carrying people on a Wednesday and carrying them on a Saturday. He has occult reasons of his own for assuming that they should pay more for bringing them home in the second week of their holiday than in the first. The simple fact that it is the same man that has to be brought back whether in two, five, eight or sixteen days never seems to have occurred to him. As a reductio ad ahsurdum of the British method let us take one or two famiHar cases, beginning with Cromer. This popular watering-place is subject to half-a-dozen different time limits on its London returns. Two single tickets cost 2\s, A tourist return good for six months costs 208. A fortnightly return is 5s. less, a week-ender is 1 Is., and a day trip is 5s. 6d. Very probably the cheap tripper rides in the best train of the lot, makes the best time, and is altogether best treated. This is another paradoxical development of modern passenger fares — 132 BRITISH RAILWAYS very often the less you pay the more you get for it. The writer frequently uses a Cook's excursion train from London Bridge to Worthing. It runs on Saturdays and Mondays, starts at a more convenient hour than any of the regular trains, goes through to Brighton with one stop, — makes close connection there with a fast train for Worthing, and reaches its destination half -an -hour sooner than any regular train could do it. In every respect this is absolutely one of the best trains on the Brighton system, barring, of course, the Pullman expresses. Its return fare is 35. compared with 9s. 2d. for two single fares by an ordinary train, or 7s. 9d. for a week-end return. A two-day return by the excursion train can be got for 4s. 6that is sometimes questioned now-a-days. Legislative control and administrative freedom were advocated by the Committee in the following terms — " The Committee entered upon their inquiries with a strong prepossession against any general interference by the Government in the management and working of railways, and they have not seen reason to alter their first impressions on that subject. But with regard to railway legislation they are convinced that it is ahke clear from reasoning and from experience that it should henceforth be subjected to an habitual and effective supervision on the part of the Government." Such supervision had, in fact, already begun. A new department had been organised at the Board of Trade for dealing with railways. Mr. Samuel Laing, after- wards chairman of the Brighton Railway, was its first chairman, and a very energetic one he proved. Thanks to him many ambiguous points in railway law and practise were definitely determined. He also endeavoured to realise the ambition of the House of Commons to have a comprehensive network of railways mapped out in advance, so that every new line authorised might be fitted into its proper place. Unfortunately the TO THE LEGISLATURE 271 comprehensive plan was never worked out, and traces of strategical foresight may be vainly looked for in our railway map. But the ideal was excellent, and the Select Committee of 1844 clearly foreshadowed it. A clause in its report says — " The Committee entertain very strongly the opinion that in the future proceedings of Parliament railway schemes ought not to be regarded as merely projects of local improvement, but that each new line should be viewed as a member of a great system of communication binding together the various districts of the country with a closeness and intimacy of relation heretofore unknown." This parliamentary dream was never realised. In an age which worshipped free trade and glorified private enterprise its realisation would have been impossible. Soon Parliament had enough to do to keep in check the rush of railway Bills which every new session let loose on it. It was impossible for the most experienced and conscientious of Select Committees to exclude all wild-cat schemes. At times the Select Committees themselves seem to have been carried away by the railway mania. fj But when the railway building programme was nearly [ finished a new parliamentary regime began. This was Vthe battle of the rates and classifications. As it proceeded ythe House of Commons became gradually less and less Uriendly to the railways. It could not resist the rising {tide of democracy, and from this period onward railway llegislation became more favourable to the traders than to \he railways. The latter were not only hedged round with statutory restrictions and disabilities, but they had various special authorities set over them. Whereas in /their early days they had to answer to Parliament alone, /they were now subject to Railway Commissioners, / municipal councils, and even district councils. At the I same time the Board of Trade continued to steadily \increase and multiply its supervisory powers. In this third stage of railway development the officials found themselves beset with regulations and restrictions. They had so many special authorities set over them that 272 BRITISH RAILWAYS they never knew which of them they were to be hauled before next. Among so many tribimals it was difficult to choose. Some companies would rather deal direct with Parliament, which in practice means with the House of Commons. Some preferred the semi-official mediation of the Board of Trade. Some would welcome the appoint- ment of a Minister of Railways. But all of them were and still are very shy of that hybrid tribunal — the Railway and Canal Commissioners. They consider that it has generally proved a waste of time and money to go before it. Rather, they say, risk the most capricious vote of the House of Commons. The late Sir Robert Inglis, when he was Greneral Manager of the Great Western Railway, expressed this view very strongly in the Memorandum which he sub- mitted to the Railway Conference of 1909. Applying it to the question of working agreements, he strongly advocated going direct to Parliament for their ratification. In the case of the triple agreement between the Great Central, Great Eastern and Great Northern Companies, that would have been a wiser course than the one actually adopted, namely, going first to the Railway and Canal Commissioners and then to Parliament, and faihng with both. Sir Robert's view was thus set forth — " It is submitted that no better tribunal for the author- isation of a combination between companies, whether b}'' amalgamation or in any less complete form, can be devised than Parliament itself, and that the present system of submitting working agreements to the Railway and Canal Commission should be abolished. The Rail- way and Canal Commission has no legislative powers, and it is hardly to be conceived that Parliament will delegate such powers to it. . . . It has been shown by the reports of various Parliamentary Committees that railway companies have, both under the General Act of 1845 and under some of their special Acts, powers to enter into agreements between one another, and it is better to leave these powers in their present position, with the right to have recourse to Parhament for any special powers they may from time to time require, than to attempt to exact TO THE LEGISLATURE 273 any general provisions at the present time, which probably, when the time comes for their exercise, will be foimd not to meet the special circumstances of the case in which they are sought to be applied." Though he preferred the House of Commons to the Railway and Canal Commissioners, Sir Robert had little love for either of them. In this he no doubt was a correct spokesman of railway managers generally. What they wanted most was to be left alone in free and reason- able exercise of the parliamentary powers they already possessed. All fair-minded people would agree with that, but Sir Robert Inglis overlooked the stumbling- block that these powers have to be interpreted by qualified courts of law. Whatever Acts of Parliament, old or new, may seem to-day, it is the judicial interpreters — in this case the Railway and Canal Commissioners — who must have the last word. So long as the railway companies have to apply to Parliament for every power or facility which they may require for carrying on their business, so long will they also be subject to judicial veto. The only escape from this double hardship is to be found in some sort of ad- ministrative control such as now exists in a haK-developed form in the Board of Trade, or which might be much . more fully realised in a Ministry of Commerce. rFair and just legislation is a primary requisite of railway success, but it can hardly be said that British railways have ever enjoyed it for long at a time. It has been shown how they were penalised in all their original expenditure. No sooner had they got their heads out of that noose and begun to get moderate returns on their capital outlay than a cry of monopoly was raised against them. To this and all subsequent outcries of a similar kind ParHa- ment promptly responded. It began with a sweeping claim to regulate rates, and went on from one thing to another, until the whole railway system was parliamenteered. At intervals of about ten years anti-railway crusades were started at Westminster, and they are still going on. In the six years 1888 to 1894 a continuous battle of rates // 274 BRITISH RAILWAYS [ land classifications had to be fought with the traders. It landed in a complete revolution of railway charges and ! /I conditions, which the companies were just beginning ! I to get over when they had to meet a still more formidable y assault — ^that of organised labour. In both these cases I the Legislature showed greater sympathy with the attack \ than with the defence. Even level-headed Conservative ^legislators seemed to regard railway companies merely as corporations which had neither souls to be saved nor bodies to be kicked. The result of this anti -railway bias on the part of the popular branch of the Legislature has been a growing estrangement between our law-makers and our railway administrators. The latter have had to adopt a fight- ing policy where a friendly poHcy would have been much better for all parties. At length the prolonged conflict landed itself in a deadlock. Between them the traders and the Labour Party have contrived to stalemate the railways at Westminster. While the parliamentary dead- lock continues little more can be done in the way of useful railway legislation. Even solemn engagements entered into by the Government with representatives of the railway companies are not safe from parliamentary repudiation, or at least mutilation. There must, of course, be a recoil one day from this futile obstructive policy. National emergencies are bound to arise — ^and they may not be far off — in which the heaviest sacrifices conceivable may be demanded of us all. The railways will have to bear in these trying times the largest share of sacrifice and responsibility next to the Government itself. Now that they should be preparing for it by husbanding their resources and strengthening their organisation, they are being fleeced and worried by politicians whose personal interests and still more their class interests obscure their vision of the supreme interest of the nation. The parliamentary scramble is destroying all sense of higher motives and larger objects. Suppose that the British Legislature and the British Railways as now constituted, and holding their present TO THE LEGISLATURE 275 relations to each other of armed neutrality, were called upon to act together in order to save the country from a food famine or some other dire calamity, could they do all that the Germans did in their meat famine of 1911? Could the railway companies be fairly asked to cut down their charges for carrjdng food by 20 or 30 per cent, as the German railways then did ? After subjecting them for years to cast-iron rates which cannot be varied in the sHghtest degree without the risk of popular agitation, costly litigation and perhaps a fresh dose of hostile legislation, how could any Government or Parliament impose on them a task of which they might be financially incapable ? When the German railways cut down their rates in one direction they very probably level them up some- where else. They have a free hand to do one or other or both. British railways cannot do anything without the consent of lawyers, law-makers and Government officials. They can level down their rates without leave, but have to get leave to put them up again. This is assumed to be for the protection of traders, but it generally works the other way. Elasticity in rate-making is what the trader needs, and no legislation can secure that to him. He can only obtain it by give-and-take negotiation with the railway companies. The worst course to adopt is to wage all-round war on the railway companies. Tm^ers in persistently voting with the Labour members against railway Bills, however reasonable, are simply hastening nationalisation, which would mean higher freight rates within the year. They seem to forget that the Labour Party has become a factor in the House of Commons, and one much more likely to grow in power /than to diminish. Its future influence on railway ^legislation has to be seriously considered. So far it has not been conspicuous either for breadth of view or length /^of vision. On the contrary, it has been of the narrowest Cand most one-sided kind. A purely and absolutely /trade union policy has been all along pursued with regard to [railway Bills. Labour members have exhibited positive \ delight in opposing railway Bills however reasonable 276 BRITISH RAILWAYS /br however much in the public interest. They have even sacrificed the interests of their own class to the bitterness of class jealousy. Millions a year have been diverted from the labour market by the blind prejudices of labour leaders against what they call the capitalist system. .""A Legislature controlled by such antagonisms cannot / possibly legislate for railways in a broad and friendly \_^pirit. Happily neither can it do them very deadly ^ harm. At the worst it can only obstruct their progress and condemn them to permanent stagnation. It cannot even buy them out, and thus realise the Socialist dream of nationalisation. No sane community would entrust its tramways, let alone its railways, to a bod}^ of politicians who prove in everything they do that they can only be dogs in the manger. If they were rational and business- like they would seize every opportunity of exercising a sensible and liberal supervision over railways, especially as regards rates and fares. They would favour instead of opposing every attempt of the railways to increase their revenues, if only in order to obtain a fresh excuse for screwing up wages. The policy of the Labour Party is reducing the House of Commons to a double dilemma. If it should be per- sisted in it will soon make it impossible either to advance or to reduce railway rates. The existing tariffs will become as inflexible as cast-iron, and there will be no means of modifying them to meet industrial emergencies however great and urgent. As it is, British railway managers have to regard with helpless envy the ease with which foreign rates are advanced or reduced on special occasions. Now and then Germany provides us with object lessons in this connection. During the " meat famine "of 1911, as our free-traders styled it, the whole of the public authorities, the State railways included, combined to reduce to the utmost the cost both of produ- cing and distributing meat. The various State Govern- ments devised and set in motion schemes for the breeding of beef cattle. Other agencies were started for the reclamation and cultivation of waste lands. Municipal TO THE LEGISLATURE 277 councils entered the market as wholesale buyers, and retailed their purchases at cost price, much to the ad- vantage of the poor. The Government seconded their benevolent efforts by giving them the benefit of reduced duties on all foreign meat imported by them. Then the State railways did their share by granting them special rates for the carriage both of dead meat and live stock. The common object of all these special arrangements and concessions was to eliminate the middle-man as far as possible. Local authorities, benevolent societies, large employers, and all who undertook to supply meat to the small consumer at or under cost price were en- couraged in their good work by reduced customs duties, special railway rates and other privileges. The railway remissions were thus described at the time by a Berlin correspondent — " The latter commodity (meat) is already carried at special rates, and these are to be cut down by 20 per cent. In the case of live stock a reduction of 30 per cent, will be made. The Government reserves to itself the right of co-operation in the fixing of prices of meat imported alive or dead under these conditions. The existing special rates on sea fish when it is conveyed inland on the order of local authorities or public organisations will remain in force till the end of 1913, and up to September 30 next feeding barley and maize will be carried for about half the present charges on condition that the benefit goes to the stock-raisers." It is not inconceivable that we may one day have a meat famine in this country. Our open ports may no longer attract adequate supplies from abroad, and what will our position be then compared with that of the Germans in 1911? Will Parliament, the Grovernment, the local authorities, the large employers and the pubUc carriers all join hands as they did in Germany and work together for the common good? Could very generous concessions as to rates of conveyance be expected from railways which Parliament had for years treated as Ishmaelites ? However willing railway directors and 278 BRITISH RAILWAYS shareholders might be to sacrifice their personal interests to those of the community, could they suddenly forget how they had been wantonly hampered and obstructed in their business by the politicians who were now appealing to their benevolence ? CHAPTER XXIV TO THE TRADERS There are certain branches of administration in which machinery and method are the most important factors — road-making, for example. There are certain others in which the personal element should predominate and the mechanical element should be reduced to the simplest possible form. Education as now carried on in this country is a striking proof of how a subject essentially simple in itself can be unnecessarily complicated and confused by excessive administration. The relations which should obtain between the railways and their customers, particularly their trading customers, su£Fer from the same evil tendency. Their natural simpUcity is overwhelmed by a multitude of laws, regulations and conflicting authorities. The railway and the trader, instead of being allowed to transact their business freely and quietly as other business is transacted, are continually surrounded by a crowd of politicians, lawyers and Government officials who dictate to them what they should do, and how and when and where they should do it. They have had schedules of freight rates imposed on them by Parliaments without any practical knowledge of railway traffic. They cannot vary their rates without a long argument over them with the Board of Trade, which may prove perfectly futile, the Board having no power to enforce its decisions. If they want a decisive judgment they have to go to the Railway and Canal Commissioners and fight it out with a costly array of solicitors and counsel, as if it were a suit in Chancery. Anytlmig more foreign to ordinary commercial ideas and practices can hardly be imagined. 279 280 BRITISH RAILWAYS There may have been some excuse for this legal and political interference in the early days of the railways, when everj^hing connected with them was novel, crude and unregulated. From very small and simple beginnings traffic grew more and more varied and complex. An increasing diversity of goods had to be classified and rates fixed for each of the hundreds of articles in each class. In connection with each mileage rate there might be a great diversity of service. The same article might travel by different classes of trains. It might have to be handled at different terminals, some cheap and others costly. It might be loaded and unloaded by the trader himself or by the railway company. It might be carried in the railway company's wagons or in those of the trader. All these and innumerable other differentiations had to be taken into account in rate-making. Such a difficult and gigantic task could not possibly have been carried through without mistakes and mis- understandings. The nature of the case required that it should be done in the first instance entirely by the railway authorities. The original rates were all more or less experimental, and for that reason they had to be arbitrary. It was impossible to consult the traders about them beforehand, however willing the rate-makers might have been. It must be admitted, on the other hand, that the rate-makers fully realised their power and made the most of it. During this tentative period of railway history the Greneral Manager was an autocrat, and doubt- less his power was frequently abused, as autocratic power often is. The chronic feuds of the railway companies themselves did not tend to allay the hostile feelings of the pubHc. In the parliamentary duels in which time and money were so lavishly wasted questions of rates frequently arose. They were hotly argued by pugnacious counsel on both sides. The attempts made to explain them usually resulted in rendering them more uninteUigible, and nothing irritates a business man so much as charges which he cannot imderstand. The state of feeling that prevailed during this period between the railways and TO THE TRADERS 281 the traders was graphically described in the report of the Select Committee of 1888 on the charges of railway and canal companies. The Committee thus summarised the grievances of the traders which witnesses of various classes had brought before them — " The complaints made against railway companies in respect to goods traffic submitted to your Committee may be arranged under the following heads — "1. That rates in excess of the maximum authorised by the special Acts are in many cases exacted. "2. That on the same line of railway higher rates are charged on some kinds of goods as compared with others, although the cost to the company of performing the service is no greater in the one case than in the other. " 3. That in many cases lower rates are charged for goods imported or for export than for the same articles produced or for consumption in this country. " 4. That preferential rates are granted to one port or town as against another. "5. That rates are now in many instances much higher than they were many years ago, and that excessive though not illegal rates prevent the development of traffic, to the prejudice of the public and of the railways themselves. " 6. That the difficulties in the way of obtaining redress of private individuals against railway companies for over-charge or illegal preference are almost insuperable. "7. That in consequence of the multiplicity of private Acts, imperfect classification and defective rate-books it is almost impracticable to ascertam the particular class to which any article belongs, and the rates which the railway company will charge or is authorised to charge for its conveyance." It is impossible to imagine such an array of complaints being brought before a Select Committee at the present day. Though rate-books are not yet by any means perfect, they have made a great advance both in consis- tency and inteUigibihty since those fighting times. It is due to the Select Committee of 1888 to acknowledge the valuable service which it rendered in bringing about improved methods and conditions. 282 BRITISH RAILWAYS After fifty or sixty years of many-sided controversy a scheme of classification and ruling was at length evolved. It assumed legal form in the schedules of 1888 and the Consolidating Act of 1894. This legislation placed the traders on fom ground in relation to the railway com- panies. It defined the rating powers of the companies and provided the traders with legal means of protection against the abuse of these powers. Only one grave defect remained in the absence of a cheap and expeditious method of settling disputes. This and the mischievous weakness of members of Parliament for tilting at the railway companies and courting popularity at their expense are the chief difficulties of railway administration at the present time. Sweeping as the assertion may seem, it is literally true that the House of Commons is the source of the worst of our railway troubles. It keeps up continual irritation between the companies and their servants as weU as between the companies and the traders. A Parlia- mentary debate on any railway question invariably gives the public the idea that the companies are Ishmaelites with every man's hand against them. Fortunately the reality is very different. Ninety -nine per cent, of their business is done just as peaceably and smoothly as that of any other large industry. Compared with the vast number of transactions which go through their hands, the disputes which reach the pubhc ear are infinitesimal. Many even of these are settled out of court, and there is a steady downward tendency in the volume of railway litigation. If all his Majesty's courts had as Httle to do as the Railway and Canal Commissioners this would be a poor country for the legal profession. It is only at long intervals that the public hear anything about them, and the really serious cases which come before them are few and far between. In the first ten years of the Commission as reconstituted under the Act of 1888 the total number of complaints which came before it was 683, or at the rate of 68 per annum. But 35 of them were against canal companies, consequently the railway cases proper were only 648, or TO THE TRADERS 283 65 per annum. One half of them (335) alleged mi- reasonable or excessive rates. Rather more than a fourth (175) complained of undue preference, and the other fourth (173) related to minor matters of delay in transit, through rates, rebates, etc. It will be interesting to traders and railway grievance- mongers at large to learn the ultimate fate of these 683 complaints. One-third of them (218) are said in the report of the Commissioners " to have been settled more or less to the satisfaction of the complainants." In another third (231) " the complainants were not satisfied." The remaining 234 cases " were not followed up by the complainants." Thus in the whole decade only 218 charges against railway and canal companies were proved to the satisfaction of the Commissioners. Out of millions of railway and canal rates the insignificant number of twenty per annum were successfully objected to. There has been of late years a tendency toward the increase of minor complaints, but a surprisingly smaU proportion of them are sustained by the Court. In 1908-9 out of a total of 280 cases entered, only 91 were " settled more or less to the satisfaction of the complainants." In 122 cases " the complainants were not satisfied," and 62 " were not followed up." The complaints with- drawn or rejected numbered 184, or nearly 70 per cent, of the whole. The truth seems to be that the Railway and Canal Commissioners' Court is used by traders more as a bogey for the railway rate -makers than as a means of redress for hona fide grievances. Doubtless not a few concessions are made to them under threat of legal action. The above figures may be useful in checking the strong assertions that are often made in parliamentary speeches and Chamber of Commerce resolutions about oppressive and inequitable rates. But the Chambers of Commerce are not always unreasonable. It is to be noted with satisfaction that they seldom adopt the fiery resolutions which their anti-railway members are always bringing f or ward .p Either they tone them down or shelve them or throw them out. This feature of their discussions has 284 BRITISH RAILWAYS become more prominent since railway directors and managers got into personal touch with the Chambers of Commerce and began to take part in their discussions. In this respect the annual meeting of the Associated Chambers of Commerce for the United Kingdom in March 1912 was a very encouraging omen. No less than four railway resolutions were on the agenda, and they were all discussed temperately as well as intelligently. Not only so, but the spokesman of the railway companies, Sir Charles Owens, spoke at some length on two of them. In both cases he received a very attentive hearing, and his speeches had a manifest effect on the subsequent voting. This in itself is a notable advance toward a better understanding between railways and traders, and greater consideration for each other. The 1912 session of the Associated Chambers of Com- merce will, I believe, rank hereafter among the most interesting and instructive of the series. It dealt in a business-like spirit with the burning commercial questions of the day — ^national insurance, labour troubles, railway agreements, railway rates, " all-British " cables. State telephones, telephone rates, and the Sugar Convention. No nearer approach has yet been made in this country to a commercial Parliament than was exhibited in these three days of serious, purposeful deliberation by represen- tatives of industry and commerce from all parts of the United Kingdom. It was a marked contrast to the corresponding exhibitions in " another place." The railway resolutions in particular were discussed with much greater moderation and less animus than heretofore. Some speakers even went so far as to put in a good word for the railways. Several delegates opposed a resolution in favour of the appointment of a Royal Commision " to inquire into the present working of the railways of Great Britain, and to report how far they afford separately or in conjunction with other means of transit adequate facilities for the cheap and rapid transport of goods and passengers." One of them gave as his reason for doing so " the very great progress made by the Midland Railway at Derby in the last fifteen or TO THE TRADERS 285 twenty years." Another observed very truly that " ever since railways were inaugurated they had been considered fair game to be shot at." But he added, if the railways were penaHsed the people who had placed their savings in them would also be penalised. Comparing them with continental railways, he recalled the too generally forgotten fact that they had had to pay outrageous prices for their land and for obtaining Parliamentary sanction to their Bills, whereas on the Continent in a great many cases the land was obtained free, and legal expenses were a minimum. The railway Bill then before Parliament received, of course, its due share of attention, and a protest against it was moved by the delegate from Sheffield. He began his speech, however, with a very naive and significant admission that " the Sheffield Chamber desired to be reasonable on railway questions, because the railway companies in Sheffield were their best customers." This is an aspect of the question which has not hitherto struck many traders, and it is much more important than even the friendly delegate from Sheffield may have been aware. It has not often been referred to by railway managers, though it gives the railways one of their strongest claims on the sympathy and consideration of the traders. At the Board of Trade Conference in 1909 Sir Samuel Fay thus put it — "It is not generally recognised how much home industries depend upon railway purchases. The annual value of materials and stores of all descriptions bought by British railways on revenue account may be put down roughly at £20,000,000 a year, or nearly equal to the value of three months' total exports from the United Kingdom to British possessions. When depression of a particular traffic on which a company mainly depends sets in, purchases must be kept within the narrowest possible limits, to the detriment of many trades, and that at the very time when they are most in need of orders for work." Reference has been made to the very conciliatory and wholesome influence which Sir Charles Owens exercised 286 BRITISH RAILWAYS in these railway discussions. A short extract from one of his speeches may be very usefully set alongside the above quotation from the report of the Select Committee of 1888. A comparison of the two will show how greatly the relations between railways and traders have improved in the past twenty years — " Speaking as a man who had been connected with railways for half a century, and who had controlled one of the large railway companies for no less than fourteen years, he could say, both from his own experience and the experience of others, that the managers of railway com- panies did recognise that the interests of the railway companies and the interests of the traders were identical. The railway companies were as much traders as any gentlemen in that room ; they existed to sell transport, and they wanted to sell as much transport as possible, and they knew that if they could sell f&teen articles at 25. it was better than selling ten at 25. Qd. The idea that railway companies forced upon traders the highest rates they could get out of them was to consider the companies to be governed by men who were not acquainted with the very elements of business. As a matter of fact, no man rose to the position of manager of a railway company unless he had some amount of business instinct. He thought it was time that stereotyped attacks upon railway companies should cease. The resolution was asking for a strong Departmental Committee to go to the very bottom of the whole relations between railway companies and traders, but was it a fact that there were such serious difficulties between railway companies and traders ? " (" Yes.") " He denied it. During the fourteen or fifteen years he was General Manager of a railway company he had had no serious difference with traders. He wanted traders to look upon the railway companies as their friends. If there were things the traders did not like they should go and see the managers about them, and he would undertake to say that, if there was any reason in the case, the railway companies would be found only too ready and anxious to do what was fair. Resolutions such as that before the meeting were being continually passed TO THE TRADERS 287 and becoming stereotyped, and it was stultifying a great body continually to pass stereotyped resolutions which it must be well known were unlikely to produce any effect. It took years to allay the irritation arising from the agitation of 1888 to 1894, and the annoyance caused by the prolonged inquiry, and nothing could be more adverse to the trading interest of this country than to submit the whole of the relations of the railway companies and traders again to an inquiry, with all the annoyance that must follow." Perhaps the best way to avoid any more official in- quiries, which it must be admitted have oftener proved futile than fruitful, would for the parties to take things into their own hands, as above suggested, and arrange their differences as far as possible among themselves. This give-and-take policy is being very successfully carried out on some of the American railways. Doubtless the Board of Trade would be glad to assist with it and to act as amicus curice whenever its services were required in that capacity. In order to be able to do so efficiently it should perhaps be armed with larger powers of certain kinds. Working agreements of a routine character which involved no public question might well be left to it. It might also have the final say about railway rates when the companies and traders cannot agree within a reasonable period. As regards the amount of control to be given to the Board of Trade over agreements and amalgamations, that would depend on the capacity in which it was called upon to act. In a case where there was no opposition either by other railway companies or by traders or by share- holders, its duty would be simply to confirm and register the agreement. Where there was opposition it would have to hear each case and adjudicate on matters of fact, reserving legal questions for the Railway Commissioners. It would be chiefly by traders that difficulties would be raised, and these would relate either to rates or service. Already the Board has under the concihation clauses considerable influence in the settlement of disputed rates. Without much danger to the railways, that power might 288 BRITISH RAILWAYS be extended by means of a proviso that if within a certain time, say six or twelve months, the railway company and the trader could not agree on a rate, the Board should arbitrate on it. Official arbitrators may sound shocking to old-fashioned free-traders, but they would at least know their business, which is seldom the case with the lawyers and politicians who are at present in control. The agitation now being carried on by Chambers of Commerce and other Associations of traders against the revised railway rates, begins to hold out some hope of friendly compromise. The Employers' Parliamentary Association has, in course of a recent correspondence with the President of the Board of Trade, thrown out the following plausible suggestion : — The Board of Trade should arrange a conference with representatives of the traders and of the railway companies, at which the railway companies would be invited to show exactly the amount of the increase in wages involved, and to satisfy the conference as to the amount of such increase which might reasonably be allocated to that part of the traffic affected by the proposed increase in rates. The con- ference would also take into consideration all such other attendant circumstances as would properly be taken into account in proceedings before the Railway and Canal Commissioners. By these means it is likely that, without great difficulty, agreement would be reached at some figure which would represent some percentage, possibly 4 per cent., as claimed by the railway companies, possibly something substantially less as claimed by the traders. CHAPTER XXV TO THE LOCAL AUTHORITIES British railways have now-a-days such a formidable host of enemies, and they are assailed from such a variety of points, that shareholders can never tell which point is in greatest danger and in most need of defence. The consequence is that in their bewilderment they seem to get paralysed and do nothing. Before old enemies are beaten off new ones start up, sometimes from unexpected quarters. It is hardly possible to keep an eye on all of them, and sometimes one drops out of sight for a time. Thus there has been little heard in recent years about the growth of rates and taxes, which used to be a prominent grievance at shareholders' meetings. This may be partly due to the effect of the fiery protests which were made against them a few years ago. These protests not only put some restraint on the rating author- ities, but they stirred up the railway boards to greater vigilance with regard to valuations and assessments. Directors had to admit that great laxity had prevailed in this department. A roundabout and most inequitable system of assessments had in the case of the EngUsh and Welsh railways been very fruitful of hardships and abuses. The Scottish and Irish lines were, happily for themselves, not subject to this barbarous method of assessment, and all they had to complain of was the rates themselves. Even these were moderate compared with the English ones. A campaign against the English railway assessments produced good fruit, in so far as many overcharges were discovered. Important reductions had to be made, and in flagrant cases refunds were obtained. The alarming U 289 290 BRITISH RAILWAYS advance in rates and taxes which distinguished the new municipal democracy was stayed, and in 1907 the agreeable surprise of a reduction was recorded. The four years 1902-1905 showed increases averaging a quarter of a million sterling per annum. In 1906 the increase dropped to £32,000, and in 1907 it suddenly changed into a decrease of £102,000. But this welcome relief did not last long. Next year the upward movement was resumed, and no further check was experienced until 1911, when a slight reduction of £23,000 occurred. Many tests may be applied to these local rates and taxes, and all of them will furnish proof of exceptional hardship. They may be measured against the aggregate amount of railway capital in the United Kingdom, namely, 1,401 miUions sterling at the end of 1911. It takes fourteen miUions to pay one per cent, on that amount, but rates and taxes aggregating £5,079,000 intercept nearly one-half of it. If we set aside the Loan and Debenture stock (£357,109,000) there will be 1,044 millions of Ordinary and Preference stock, on which £5,079,000 of rates and taxes will be exactly one-half per cent. If, again, we exclude the Preference stocks and deal only with the Ordinary, which amounts to 4 93 J milhons, the rates and taxes will average more than one per cent. This is perhaps as simple and concise an illustration of the subject as can be offered to Ordinary shareholders. Rates and taxes represent fuUy one per cent, of dividend, which is diverted from their pockets to those of the local authorities. To be exact, a small part of it passes to the Inland Revenue in passenger duty, but apart from that the local authorities are the chief receivers. The fact to be impressed on railway shareholders is that before a penny of Ordinary dividend can be paid, one per cent, will have been " municipalised." To a large extent this is simply an extra income-tax. The railways generally benefit less than any other class of ratepayers by the local expenditures to which they have to be chief contributors. A large portion of the rates that are spent on highways, for instance, may injure instead of benefiting them by fostering competition on the part of road vehicles. TO THE LOCAL AUTHORITIES 291 " Rates and taxes " in the broad sense ought to include the income-tax payable by Debenture holders on their interest and stock-holders on their dividends. If we do this we shall get a total of nearly eight millions sterling which the railways have to pay out of net receipts amount- ing to barely 48| millions. The apostles of confiscation may be shocked when they run up against discoveries of this sort, showing that other fiscal locusts have been there before them, and have eaten a big slice of the railway cake. Of the modest residue that remains after Deben- ture interest and Preference dividends have been paid, one-fourth is annexed for rates and taxes, and the Ordi- nary shareholder has to be thankful for the remaining three-fourths. So far we have been regarding local rates and taxes as a tax on capital. A tax of one per cent., or even of a half per cent., on capital is all the world over con- sidered a heavy burden. But the Ordinary stock of British railways has to pay in one form or another IJ per cent, of taxation. It is first mulcted of £5,079,000 in local rates, and then of a round million in income-tax. That makes £6,079,000 on a nominal capital of £493 millions, equal, as already said, to IJ per cent. After which the railway shareholder will still have his own private rates to pay. He, in fact, never knows when he is done with the rate collector. Corporately or personally he is always being taxed and rated. On the very narrow margin of dividend which he enjoys — say 3 J per cent. — such taxation is a much more serious matter than it would be on the much higher yields of industrial securities. Perhaps IJ per cent, on capital, heavy as it looks, would not be intolerable if associated with a 6 or 7 per cent, dividend, but when levied on 3 J per cent, dividends it becomes oppressive. Nor as time goes on is it likely to improve in that respect. With the evolution of the new land taxes it threatens to become destructive. But there is a point beyond which it will begin to pinch other railway interests than those of the shareholders. Over five miUions a year of rates and taxes may prove a 292 BRITISH RAILWAYS serious matter, not merely from the dividend point of view, but from the wage point of view also. It is a considerable item of expenditure whichever way we look at it. An engine-driver might stare a little if he were told that railway rates and taxes nearly equal the loco- motive wage bill of our whole railway system. The difference between the two totals is only £607,000 — rates and taxes having amounted in 1911 to £5,079,000, and the " working of engines " having cost £5,686,000. The latter sum did not, however, include repairs and renewals, which form a separate item of £2,476,000. Another coincidence of the same sort may interest the coal-miners. The total expenditure of all the British — and Irish — railways on coal and coke in 1911 did not much exceed the aggregate of their rates and taxes. It was £5,661,000 as compared with £5,079,000. It may further interest locomotive men and coal-miners to learn that rates and taxes are increasing a good deal faster than the coal bills or the locomotive pay sheets. They have risen from £4,228,000 in 1902 to £5,079,000 in 1911 (in 1910 they were £5,102,000), an increase of £851,000. In the same period the coal bill advanced from £5,042,000 to £5,661,000, or £619,000, and the locomotive pay sheets from £5,251,000 to £5,686,000. Of the three locusts the rate collector appears to be the most voracious. In the past ten years he has increased his levies by £851,000, while the coal contractor has exacted only £619,000 more, and the locomotive men £435,000. But the locomotive men are fast making up for their overmodesty in the past. The point to note is how relatively large an item rates and taxes are in railway expenditure. To an average householder they mean a fourth, or it may be a third of his house rent. This may be only a twenty-fourth part of his total income, while to an Ordinary shareholder in a British railway they mean a fourth of his whole income from dividends. It is not in rating only that the local authorities have been bad friends to the railways. They have penalised them in many other ways. Often they seem to dehght TO THE LOCAL AUTHORITIES 293 in putting them to needless trouble and expense. They have sometimes approached very near to blackmailing them. But in such cases the would-be biter has been generally bit, as in the following example. A go-ahead town on the Bristol Channel had in its neighbourhood a small watering place which it was anxious to develop. It was served by two trunk railways, one of which thought to pay it a graceful compliment by running a short branch down to the embryo Brighton. It lodged a Bill for the purpose, but to its amazement the town council gave notice of opposition, and prepared to send up the usual civic deputation to exploit the Select Committee and take in a few outside sights as well. But tliis little game was nipped in the bud by the prompt withdrawal of the Bill, to the great chagrin of its sham opponents. It is now quite understood by the promoters of new railway schemes that they may expect to see every town council and district council on the route mustered in the Committee room against them. They make such a formidable show that they generally succeed in their opposition, sometimes to the public advantage and some- times the reverse. But whether the rejected Bills be good or bad, this method of sifting them is as irrational as it is expensive. It becomes idiotic when it is applied to the Bills of established railway companies applying for additional powers. These may be absolutely necessary for the carrying on of their business as well as for the public service, but the modern legislator is superior to sentiments of that sort. He has more practical interests to consider. He may be a Labour member sitting for a trade imionist constituency which has declared war against railway companies as the enemies of labour. Or he may be a faddist who wants British railway rates reduced to the American level, regardless of the fact that American rates are for haulage only, and long hauls at that. Or he may be an anti-railway man of the municipal sort who thinks that Parliament should give nothing for nothing except to municipal philanthropists and housing reformers. These gentlemen have been costly legislators for the 294 BRITISH RAILWAYS railways. They have obliged them to spend millions on re -housing schemes and on street improvements which invariably ended in a flagrant waste of money that could be ill spared. It is, of course, in the metropolitan area that the railways have been worst victimised in this respect. All the principal London termini have had to pay toll to the municipal dictators, and one company, the Great Eastern, was so badly fleeced by them that it has never got over it. Liverpool Street Station is a monument of municipal greed and railway penalisation . All the municipal faddists seemed to gather together and descend on its devoted head. The worst of them were the re-housing reformer and the advocate of workmen's cheap trains. The Great Eastern company was caught in both these municipal crazes, and its sad experiences are duly recorded in a variety of parliamentary records. Mr. Gooday, the then General Manager, in giving evidence years after, before the London Traffic Commission, thus described the bad bargain made with Parliament in 1864 — " When we were seeking powers to construct our Metropolitan new lines, we had imposed upon us by the Great Eastern Railway (Metropolitan Station and Railway) Act of 1864 an obligation to carry workmen at 2d. fares for the return journey from Edmonton, distant llf miles from London, and Walthamstow, distant seven miles, from London. In return for that we were excused from certain obligations with regard to re-housing the working classes we displaced. In those days we were anxious not to incur a large capital expenditure in re-housing these workmen, and that is one of the reasons why the obligations were accepted by the company." Though the Great Eastern fared worst, it was not alone in playing a losing game with the municipal philanthropists. Other metropolitan railways also saw visions of wealth and ever-increasing dividends in the new surburban traffic, and burnt their fingers over it. They gladly allowed themselves to be saddled with workmen's trains, cheap trains, and every other " deadhead " privilege that the parliamentary Samaritans TO THE LOCAL AUTHORITIES 295 could think of. In many cases the suburban traffic was so handicapped from the start that it never had much of a chance to make money or even to pay its way. What with the longer trains, the extra carriages needed to meet the morning and evening rush of traffic, and the sidings that had to be provided for carriages out of use during the day, it is doubtful if the cheap suburban fares could ever have paid. Of all the failures among London railways, and they are not a few, the most wasteful and disastrous are the suburban schemes which were thus hatched by a long course of haggling between parliamentary mimicipal and railway negotiatiors. The popular train service which it introduced was the most prodigal that could have been devised, both as regards stations and rolling stock. Being a purely morning and night service, it was in full use for only a few hours daily. The rest of the twenty-four hours the trains were eating their heads ofiE in expensive sidings. " A third-class workmen's train," said Mr. Gooday, " runs 47 i miles a day ; an ordinary workmen's train runs 68| miles. The reason is that during the other periods of the day when the trains are not fiDed with workmen, we must have first and second class carriages on them. The ordinary trains running morning and evening only run 73 miles, and the ordinary trains running all day run as much as 269 miles. The capital expended in providing sidings for the trains during the time they are idle ought also to be taken into consideration, although it is impossible to estimate exactly how much should be attributed to this particular traffic." According to Mr. Gooday, who appears to have worked out the problem thoroughly, the new suburban lines were too heavily handicapped from the beginning ever to have had a chance of success. Two disadvantages on which he lays special stress are the large number of stations required in consequence of their being so close together, and the disproportionate expense of staffing and maintaining them. The local rates alone swallowed up a large percentage of their earnings and it is not 296 BRITISH RAILWAYS surprising to learn that when the traffic fell off some of them had to be closed. The cost of working the cheap trains rmming out from Liverpool Street on being most carefully calculated was found to average 43* 76c?. per mile, "taking all things into consideration." That included an expenditure of £110,000 in lengthening platforms and putting on extra coaches — seventeen instead of the usual fifteen. The re-housing schemes were losing concerns, and threw a heavy burden on the rates, a large part of which recoiled on the railway company. Rates rose so much that the better class of residents were driven away from the district, and again the railway company was the principal loser. It might have been thought that the mimicipal Sam- aritans after doing so much harm to the railways might have relented toward them, and even have felt some pity for them. But there has been no relenting. On the contrary, there has been continuous hardening of heart. The railway companies appear to have more parliamentary and municipal enemies now than they ever had before. Every railway Bill of any consequence introduced into the House of Commons calls out swarms of them. The railway companies, brewers and State Churches have become a trio of political Ishmaelites. To-day the trader, the trade unionist, the municipaliser, the nationaliser, and the politician at large are all out against the railway shareholder. He is even more at their mercy than the land-owner. They can only tax the land or confiscate it openly, but they can get at a railway in a score of side ways. They can saddle it with so-called Conciliation Boards. They can compel it to run work- men's trains at a loss. They can blackmail every Bill it introduces into Parliament. They can keep up a perpetual outer V for increased facilities, comforts, and luxuries in travelling, all of them, of course, to be free. Just now it is the municipal philanthropist who is most in evidence against the railways. A few years ago the London County Council presented a modest request to the Railway Commissioners for an extension of the " ten miles for a TO THE LOCAL AUTHORITIES 297 penny " scale of passenger fares. This was another nasty hit at the Great Eastern, the railway which in the past has suffered most from the cheap train craze of our parliamentary and municipal Samaritans. The Ck)unty Cotmcil coolly went outside of its own territory to attack a rival in the transportation business. It asked to have the Great Eastern Railway compelled to carry passengers in a district outside of the Coimcilarea at rates lower than the Council was charging on its own tramways, low as most of these are. This was surely a reductio ad absurdum of municipal fussiness. The attempt failed as it deserved, and now that the London County Council is itself bearing the brunt of unfair competition it may be able to feel more sympathy with neighbours in a similar plight. At all events the motor-omnibus seems to have had somewhat of a sobering influence on our municipal busybodies. It is some time since they launched any new scheme for penaUzing the railways. Their game of late has been obstructive rather than destructive. Town Councils, County Councils and District Councils find a bond of union in indiscriminate resistance to any kind of railway invasion. This is hard on the promoters of such schemes, who sometimes lose hundreds of thousands of pounds in unsuccessful battles in Parliamentary Committee Rooms. But for the railway interest as a whole it is not an un- qualified misfortune. It heads off possible competitors, and strengthens the grip of existing railways on their several territories. Not many years hence local author- ities may be as anxious to obtain new railways as they have been of late to shut them out. CHAPTER XXVI THE RAILWAYS AND THE STATE In discussing the relations of any great industry to the State the first danger we have to guard against is the use of bogey words such as Socialisation and Nationalisa- tion. The next pitfall to avoid is the very common assumption that questions of this kind are to be settled by theoretical or ideal methods. The theorist may be very useful in thinking out general principles, but in the thick of an industrial conflict he does not count for much. Real conflicts have real issues behind them. They are fought out by real men with human tempers. When their blood is up they have little thought to spare for principles or ideals. When they have finished their fight they make peace on the best terms they can, which as a rule will be based on actual circumstances of time and place. A large majority of industrial disputes spring from local causes, and latterly many have been of personal origin. Driver Knox and Guard Richardson were for a brief week or two shibboleths in the mouths of two or three hundred thousand railway men. But though on the surface the quarrel over them was personal, under- Ijdng it there were several vital issues, — ^the safety of the public, the disciphne of the railway service, the right and duty of the State to intervene, and the best form of intervention. This last was the most difficult as well as the most critical question of all. State control has, from the dawn of our railway history, been one of its essential factors. It was not directly asserted imtil a compara- tively late period, and it was longer still in being recog- nised by the railway companies. But it has been in THE RAILWAYS AND THE STATE 299 actual operation for many years and every fresh trouble in the railway w^orld tends to strengthen it. Therefore it is too late to argue about the abstract merits of State control and State intervention. The thing exists and has existed for years under various names. Each generation has found a new name for it, to express the latest advance in its development. At first it was simply a general right of supervision over the railways as necessary monopolies. Next it intervened on behalf of public safety. Then it took the railway shareholders under its protection, after them the traders, and finally the working staff. The State is now a universal providence for all the varied interests affected by railways. To this extent — and it goes much farther than most people suspect — our railways are already nationalised. If we could imagine a Nationalisation Bill being suddenly rushed through ParHament and put in operation at once we might be astonished at the very small difference it would make to most of the people who had looked forward to it as the opening of a new era. By the time that its eagerly anticipated advantages had been realised and shared out the individual quotas would have shrunk to very small dimensions. Then there would be a debit side of the account to set off against the credit side. Unfortunately in a social rearangement no person or class can be bene- fited except at the expense of another person or class. Where, as in this case no new wealth is created, redistri- bution might be a mere game of " general post." It is not this clumsy sort of nationalisation that railway shareholders need concern themselves much about. What they have to look out for is the kind in actual operation and being gradually extended : the State control which step by step is spreading itself over our whole industrial and economic system. Public health, education, production, and transportation are all being nationahsed in the sense that they are being treated as national interests. National ownership could only be at best a step farther in the same direction, and at worst it might be a long step backward. 300 BRITISH RAILWAYS State control, which is at present a very haphazard hand-to-mouth arrangement, may develop into a scientific form of national control, though as yet there is very little indication of it. In any case there will be no brand new social system. The future will have to be evolved from the present, as the present has been evolved from the past. The practical question of the day, therefore, is not how to transform the existing system of privately owned but State controlled railways into an ideal system of State owned and State controlled railways. It is how to get the best possible results out of the existing arrangement. No one pretends that it is perfect. Both the State control and the private ownership are sus- ceptible of great improvement. Neither of them is well organised and self -consistent. A State control which is exercised sometimes by the Cabinet, sometimes by a Cabinet Minister, sometimes by the House of Commons, and sometimes by a Government Department, can hardly be expected to produce ideal results. Theories and doctrines apart, the public interest demands that the existing machinery should be got into working order, that its obvious defects should be cured and its causes of friction removed. First of all we need a properly constituted State authority capable of exer- cising an intelligent, impartial and judicious control. In other words it must be a non -political control, inde- pendent alike of Ministerial majorities, trade imion threats and outside dictation of every sort or kind. Such a properly constituted authority ought to have a proper ethical code to work upon. Certain funda- mental principles would have to be laid down before- hand for its guidance. The railway companies, the traders and the trade unionists would have to agree among themselves whether or not private property in railways was to continue to be recognised. It would be a mockery of law and justice to compel any one to submit to a tribunal which did not recognise the plainest prin- ciples of social law and order as hitherto understood. If it is social chaos and disorder that the trade imionists want they should go for them by the shortest and THE RAILWAYS AND THE STATE 301 most direct route so that the issue may be settled as speedily and thoroughly as possible. They camiot have State control and anarchy at the same time. State control means justice, fair play and equal treatment for both sides. To such a tribunal neither the honest capitalist nor the honest employer need fear to submit himself. But no capitalist or employer can be forced to subject himself permanently to tribunals of the opposite sort. Individuals may be dishonest, whole classes of society may be dishonest, but no State can afford to be utterly dishonest. If it were it would be denying its own moral authority and its right to govern. In order to govern efficiently the State must be a power of itself : something above and beyond the governed. It should be as little as possible at their mercy or under their control. In trade disputes it should not be bottle-holder to either side. When it intervenes it should be on behalf of the public as such and not in the interest of either labour or capital. This would be the true demo- cratic doctrine, and already some democratic States are acting upon it. In the gas-workers' strike at Sydney in February 1913 the public authorities, both national and municipal, acted upon it and all did their duty, con- sequently short work was made of the strike, and the right of the public to be protected against anarchy from whatever quarter was triumphantly vindicated. The Sydney gas-workers' strike was a much-needed encouragement for British railway directors and share- holders to stand firm against threats of anarchy and public misery. The Minister of Labour and Industry having made reasonable proposals for a settlement, and the strikers having rejected them, he decided to guarantee protection to free labour. At the same time the Lord Mayor appealed for volunteers to help the gas companies to maintain the necessary supply of gas. Even the Executive of the Labour Council joined in and asked unionists not to join the strikers. In a very short time sufficient labour was got to carry on the works. This remarkable strike wound up with an incident which was the strangest of all. The Prime Minister 302 BRITISH RAILWAYS issued a public explanation of the conduct of the Govern- ment in which he stated that " the strike issue is not now between the gas companies and the men. The Govern- ment has intervened on behalf of the public and is standing for the principle of arbitration which is the policy of the State endorsed by the Labour Party." Here we have the true doctrine of State control laid down and practically illustrated. It is an absolute negation of the national strike shibboleth which is so quickly shouted by the hotheads of the colliery and railway unions the moment that anybody treads on their toes. When we happen to have a Government in this coimtry with sufficient courage and sense of fairness to follow the good example set at Sydney in February last there will be little danger of any more national strikes. The very thought of such an outrage will be banished from the mind of the most irresponsible labour leader. This is one way of nationalising the railways which we do not need to wait for, much less to dream of as a future paradise. It may be realised at once if the trade unionists will only recognise that they are not the State : that it is something above even them, and that labour as well as capital is in the long run subject to it. When railway men or any other class of workers resort to anarchy they change the trade union issue into a national one. As the Prime Minister of New South Wales put it the question is no longer between employers and employed, but between the Government and the enemies of society, who, as such, must also be enemies of the State. This thoroughgoing democratic doctrine would of course demand sacrifices from both sides, but in the long run they would be worth their price. To be relieved once for all from the barbarous threats of national strikes would compensate employers for liberal advances in wages, which again might console the workers for giving up the right to inflict the largest possible amount of harm upon their fellow creatures. A State armed with the power to arbitrate between employers and employed as to wages and conditions of labour would as far as industrial questions are concerned THE RAILWAYS AND THE STATE 303 be a virtual dictator. There may be danger of such power being abused, but apparently that risk must be faced. The only alternative is a stiU worse dictatorship, that of the trade unions. Precautions can of course be taken against abuse. The State should not exercise its power of arbitration through any poUtical agency, but through a specially constituted tribunal of the highest character and capacity. This tribunal should combine the authority of the Cabinet and the House of Commons with the professional qualifications of the Railway Commissioners and the Board of Trade. Its decisions should be such as the whole country would accept with confidence, and to which pubhc opinion would enforce obedience on both sides. It should be a body able in its own sphere to speak for the nation and thus to give us the kind of nationalisation most urgently needed in the railway service as in several others. As regards nationahsing the railways the writer has long contended that it is not the shareholders but the railway men who are the greatest obstacles to it, because they are least willing to make sacrifices for it. It has been said over and over again at railway meetings that any honest scheme of expropriation would be favourably considered. Even among railway managers there is no strong prejudice in favour of the existing system. The fact of their being all believers in amalgamation and consolidation shows that they are already well on the road to nationalising. One distinguished manager who died a few years ago was an avowed nationaliser. He did not consider that on fair and equal terms national owner- ship could beat private ownership, but he held that hampered and handbound as private management is now-a-days it cannot do justice to itself. This argument grows stronger year by year, and it is evidently ap- proaching its climax in these days of dictatorial guards and drivers. State control is no new idea among British railways. It laid hold of them in their infancy, and ever since it has been tightening its grip on them. At first it was exercised 304 BRITISH RAILWAYS in a mild and inoffensive way by a specially created body — the Railway Department of the Board of Trade. This was intended simply for purposes of observation and statistical information. The Select Committee of 1838 which recommended its appointment offered the naive reason that the railways had acquired a greater monopoly of transportation than had been foreseen when the original Acts of Parliament were granted, and would now require to be better looked after than ordinary carriers. They must be treated, in short, as monopolists. The following clauses in the report of the Select Committee indicates the sort of supervision that was deemed necessary. In its vague and harmless suggestions it contrasts strongly with the Board of Trade activity we now see around us. I. That railway companies using locomotive power possess a practical monopoly for the conveyance of passengers on their several lines of railway, and that under existing circumstances this monopoly is inseparable from the nature of these establishments and from the conduct of their business with due regard to the nature of their business. II. That this monopoly is the result of circumstances contemplated neither by the Legislature nor by the Companies themselves, the extensive powers contained in their Acts of Parliament having been obtained under the impression that the interests of the public were sufficiently secured by fixing a maximum rate of tolls, and providing for free competition in the supply of locomotive power and other means of conveyance. III. That under these circumstances the Legislature is bound to provide that the public interests shall not suffer from the mistaken view taken in the infancy of the science of locomotion, and that for this purpose the powerful monopoly under which a large and increasing portion of the national commerce of the country is placed should be subjected to the supervision and control of the Board of Trade. IV. That as an important part of this duty the Board of Trade should collect and register statistical information THE RAILWAYS AND THE STATE 305 on all points of general interest connected with the railway system. By degrees, as the statutory powers of the new Depart- ment were enlarged and extended it became more aggres- sive. In 1885 it was no longer content to be a mere collector and publisher of statistics. It aspired to take a hand in the war of rates which then broke out between the traders and the railway companies. A Government Bill was introduced which would have given it power to make and change rates at its discretion, subject only to the veto of Parliament. The railway companies succeeded in defeating that attack, but it was only a brief respite they obtained. Mr. Grierson's account of the Bill shows that even thirty years ago the anti-railway move- ment was well advanced, almost as far, indeed, as it is to-day — " Last session (1886) the Board of Trade introduced a Bill not only to compel the railway companies to do what they by their Bills introduced in the session of 1885 sought to do but also to make it obligatory on them to accept such altered rates and tolls as the Board of Trade with the subsequent sanction of Parliament might lay down, and to submit to periodical revisions thereof — requirements so contrary to the conditions under which the companies provided the capital for the construction of the railways that it is difficult to believe that the effects of the provisions of the Bill could have been clearly understood." The feud between the traders and the railways died down after 1889 and by 1894 it had been compromised. The new classifications and schedule of rates then agreed upon have been in force for nearly twenty years, but they are now showing signs of wear. No sooner, however, had the traders been pacified than the trade imions took the field and the railway managers have since gone through more worry over wages than they had to suffer before over rates. Between the two the Railway Depart- ment of the Board of Trade has been kept busy right along. It is being appealed to almost daily by railway companies, public bodies, private traders and employees. 306 BRITISH RAILWAYS If it could promptly and definitely settle one-third of the questions submitted to it it might be a fair substitute for the efi&cient State control which we are advocating. But as regards rates and wages its powers are for the most part only advisory. The crux of the matter is — Can a bona fide effective State control be created either out of the existing Railway Department of the Board of Trade or out of the Railway Commission or by some new combination ? This is the practical question of the day and it is also the real question of the future. It is the socialist question as well as the trade unionist question. Even if the railways were to be confiscated they would still have to be operated. The same quantity of traffic would have to be carried if the men were to earn the same amount of wages. There would have to be discipline of some kind if the whole service were not to go to pieces. The con- fiscated part of the net revenue would have to be divided up among perhaps ten times as many claimants as the number of its dispossessed owners. Thus the issue would return in a vicious circle to a question of State control — ^the only practical form of nationalisation. It may be that the conflicting forces which are now shaking our railway system almost to its foundation are unconsciously working towards a common end. By different and apparently opposite paths they may be advancing toward some kind of State control which will do justice to all of them, and in which they can all have confidence. The more thoughtful of the unionist leaders apparently begin to see that something of this sort would be the most rational form of compromise. In giving evidence before the Departmental Committee of the Board of Trade on Railway Agreements they indi- cated as much. The most outspoken of them was the editor of the Railway Review, Mr. G. J. Wardle. He quoted with approval the following passage from the Statist — " If the agreements and arrangements are to be sanc- tioned, as we trust they will be, it will be absolutely necessary to create as a portion of the machinery of THE RAILWAYS AND THE STATE 307 Government a Board of Railway Control, to protect the nation's interests, and to see that the agreements and arrangements make for the public welfare. This board should consist of men whose ability to exercise effec- tively the important duties entrusted to them would be universally recognised." Mr. Wardle even went so far as to acknowledge the friendly disposition of railway shareholders toward reforms likely to be for the common good. On this point he heartily endorsed the views which had been recently expressed by the Chairman of the Railway Shareholders' Associa- tion — " Ordinary shareholders who have no official bias can see that the tendency of events is more and more towards Government supervision. It seems to them wiser to recognise this tendency than to shut their eyes to it, or to fight blindly against it. The Board of Trade has become much too powerful a factor in the administration of our railways to be got rid of, even if that were desirable. The only possible policy now is for all concerned to make the best of it by seeing that its power is wisely and justly exercised. That can be best done by each of the various interests entitled to the protection of the Board keeping in close touch with it. Whether we like it or not, a certain amount of Government intervention has become inevitable in every important dispute arising between the owners of the railways and the large classes of the community dependent on them for their livelihood ; whether as traders or as workers." It is a curious fact pointing also in the same direction that since the Knox and Richardson disputes the National Union of Railwaymen has adopted a formal resolution calling on the Board of Trade for fuller and stricter enforcement of the rules and regulations for the safe working of the railways. So far good, but the railway managers on their side wiU have to see to it that the increased official control thus demanded is not perverted into an instrument for obstructing necessary improvements and economies in working the traffic. That is above all what the companies have to fear and to guard against. CHAPTER XXVII NATIONALISATION The question of nationalising railways is argued on so many different and incompatible grounds that the various arguments are apt to clash. If we consider it first from a commercial standpoint it has very little to say for itself. If we regard it as a political issue it at once becomes involved in the discredit and disfavour into which political methods have lately fallen. If we treat it as part of the great socialistic movement, it will be like the rest of that movement, a waning force. But there is one, and only one point of view from which it is really dangerous. The future of railways generally, and British railways in particular, depends on the development of trade unionism. If the latter had remained on its original lines, employers and employees might have continued to settle questions of wages in a friendly give- and-take spirit. But if the policy of class war, which has of late been adopted by the unions, is to be carried to the bitter end, it wiU force the railway companies into an impossible position. A house divided against itself cannot stand, much less a railway system, which in order to do its duty efiiciently must go like clockwork. In the campaign of grumbling and kicking, which has been started by the railwaymen, a point may soon be reached at which authority and responsibility will have disappeared together. The railways may then have to be nationalised, not for com- mercial or political or socialist reasons, but as an im- perative necessity. The only way to save them from themselves may be to place them under martial law. This is the sort of nationalisation we are most likely to end in, and the people who will like it least are the trade unionists who are now shouting most lustily for it. When the nation takes them in hand they will have a 308 NATIONALISATION 309 master whom they dare not criticise and caricature and vihfy as they now do their private employers. It is not railway shareholders who have to fear nation- alisation, unless the nationalisers are going to plunder them completely. Neither is it the railway officials, whose power would be increased tenfold when they became national functionaries. If, as the trade unionists allege, many of them are bumptious and overbearing, what would they be as State officials without any Boa^ of Directors to fear, or shareholders to consider ? A short trip on a Prussian railway-r-all of which are nationalised and State-owned — ^might thoroughly dis- abuse any intelligent English railwa3rman of the idea that he would be better off as a State employee. Short of deliberate spoliation, which, after the past six or seven years' experience of a semi-socialist regime, is less to be dreaded than it was, railway shareholders have less to fear from nationalisation than either em- ployees or traders. It could not possibly do them greater harm than the class war which is now being systematically waged against them. This has shaken their credit more than anjrthing that ever happened to them before. It has reduced the market values of their securities far below the level at which their returns should be capitalised. It is hampering their operations at every point, and rendering it increasingly difficult to perform their responsible duties to the community. This issue will by and by become so serious that the community itself will have to take it in hand. It will pass out of the control of the railway companies, and the nation will have to decide once for all on the kind of railway administration it prefers. If it desires the present system to continue, it will have to devise a modus Vivendi between existing employers and employees on the one hand, and railway users on the other. If it should decide on eliminating private employers and substituting State ownership, that will only vary the problem without solving it. It will have got rid of the least troublesome of the three hostile factors, and the two most difficult ones — ^the traders and the workers — will remain. The class war will still have to go on. Its conditions 310 BRITISH RAILWAYS will only have changed for the worse. The railway- workers will continue to think only of their own class interests, and the State will have to oppose them in the pubUc interest, just as the railway companies are doing now. The question is whether its opposition will be weaker or stronger. As to that there cannot be a doubt. The existence of a modem State depends on organisation and discipline. It has to choose between order that is life-giving, and disorder that is self -destroying. Already we have seen enough of the latter to be able to judge of its future prospects. Day by day we are getting fresh proofs of the great truth that government without moral authority is a contradiction in terms. But there can be no authoritative government while whole classes of the community — ^miners and railwaymen, for example — are arrayed against it. In the ultimate determination of a vital economic question like this Parliaments and political parties count for very little. They are only flies on the wheel, and very ephemeral flies at that. A La hour- ruled House of Commons may pass Labour laws by the score, but it will not have the slightest control over their actual results. They are quite as likely to work the wrong way as the right one. The most triumphant democracy cannot set aside, much less conquer, the natural laws of society. No shuffling of political cards can give every class all it would like, and no single class can be allowed to have all its own way. Even railway shareholders must have some kind of justice meted out to them, or the community as a whole will suffer along with them. Supposing that they were expropriated, the trader and the railway worker would find themselves face to face with directly and absolutely opposed interests. They would be worse off than when the railway shareholder acted as a buffer between them. Just now he is not a mere buffer. He is a sort of mediator and balance-holder. There are many losing rates which have to be made good out of his scanty dividends. When he becomes a simple annuitant, neither trader nor worker will have any further claim upon him. They will have to fight out their quarrels themselves, unless the Board of NATIONALISATION 311 Trade or some other public department cuts them short by issuing an official decree which neither of them dare disobey. Under a regime of nationalised railways the traders and employees would be natural enemies. Their interests would be continually clashing, and there would be no intermediate power to weaken the collision. Freight rates could not be lowered and wages raised simul- taneously. They would have to take turns, and the traders and workers might ifind that quite as difficult a matter to arrange as a new scale of wages under the existing regime. The only source from which the two classes might derive common benefit would be increased economy and efficiency in working, but that involves conditions to which railwaymen, in their present state of mind, would not be likely to submit. The controllers of the traffic would require to have a free hand in making experiments to reduce the cost of transportation — a privilege which is now being rapidly curtailed. They should also be free — which they have not been of late — to adopt labour-saving and time-saving methods. The ideally-managed railway would be continually increasing the average amount of transportation per- formed per head of its working staff. Divested of labour, municipal and political complications, that is the true rail- way problem . But the trade unionists cannot face it in that light, because it is at complete variance with their policy. It suits traders and shareholders because the more efficient the working the lower the freight rates and the higher the dividends. Between these two there is no irreconcilable contradiction, but between labour on the one hand and rates and dividends on the other there is an impassable gulf. The trade-unionist gospel requires the largest pos- sible number of men to be employed at the highest possible wages, and for the shortest possible number of hours per day. This is the antipodes of proper railway administra- tion, whether national, municipal or individual. The reproach most frequently flung at existing railway managers is that, notwithstanding all the recent advances in wages, more work is done for less money than before. Men are better paid than formerly, but fewer of them are 312 BRITISH RAILWAYS needed ; therefore the gain to the men and the loss to the railways is less than it appears to be. Judged by this test the labour agitations of recent years have all been economic failures, and they would equally fail under nationalisation. There would be as much, or even more, necessity to show good returns in State-owned as in company-owned railways, and that can be done only in one way — by efficient and economical working. Thus the nationalisers have to choose between good administra- tion for the railways and a good time for railwaymen. The two conditions are utterly inconsistent and incom- patible. They may be partially reconciled by a judicious policy of compromise ; the traders being satisfied with reasonable rates, and the men with the fair current value of their labour. Within these reciprocal limits railway transportation may be made a great industry, with or without nationalisation . The problem of nationalisation cannot be solved by looking at it solely from the railway point of view. It is equally necessary to regard it from the opposite stand- point of the State. Are State-owned railways likely to be of greater service to the public than privately-owned railways ? Is the State in a fit condition to undertake so huge an enterprise, and to manage it efficiently ? Are there no more pressing and important tasks than railway nationalisation which the State should see to first ? What about the ordinary highways, which, between national and local tinkering, are fast becoming both an incubus and a scandal ? It might have been thought that the nationalisation of our transport services should begin with the public roads. The future ownership and control of them is quite as difficult a subject as the State management of the rail- ways. When the State has proved that it can provide the country with good roads at moderate expense, then it may be time to talk about nationalising transportation generally. Meanwhile there is a more valuable service that can be rendered to the railways at comparatively small expense. What they need before nationalisation or anything of that sort is an intelhgible railway law and an appropriate means of administering it at reasonable cost. NATIONALISATION 313 More than half of the ill-feeling that exists between railways and traders is due, in fact, to slipshod piecemeal law-making. If the trader had, as in Germany, a concise code of rates and regulations he could always find out for himself what was the proper legal charge in a given ease. In this country he very seldom can. When he has satisfied himself that he is being overcharged he has no prompt and inexpensive remedy. He must fight it out in the first instance with the railway officials. Failing satisfaction from them he may go to the Board of Trade, where he will get good advice, but no more. For an effective decision he must go still higher, to the Railway and Canal Commissioners. In practice he finds that every disputed rate involves a laborious and costly lawsuit. The wholesale advance of rates which was made on July 1, under the Railway Act of 1913, will affect miUions of traders and might give rise to many millions of rate disputes. But not a fraction of them will ever come to a satisfactory settlement, simply because there is no means of settling them within reach of the ordinary trader. The Railway Commissioners' Court is as far above him as the Court of Chancery or the House of Commons itself. As for the Railway Act of 1913, from its inception on the famous Saturday night in August 1911, it has been an unlucky measure. It interrupted at the last moment a strike which, in the true interest of the railways and the country, ought to have been fought to a finish. It was ill-received by the House of Commons, and could only be pushed through by a strong effort of Ministerial authority. It has provoked violent opposition from all classes of traders, and broken the peace which had existed for twenty years between them and the railway companies. All because we have no simple business-like system of fixing railway rates. In 1911 the general principle was admitted that railways are as much entitled as other industries to living rates, and that when their working expenses were being continually increased by the higher demands of labour, they had a claim on the commimity for, at least, partial compensa- tion. In their case this claim was all the stronger because of their special relations with the State and the 314 BRITISH RAILWAYS Legislature. The higher demands of labour were, to a large extent, forced on the railway companies by political influence. They were subject to the control of special tribunals created by the State. They were supported by a large body of public opinion . The railway companies could not have resisted them indefinitely without incurring odium and impopularity, such as no large body of em- ployers cares to endure. The moral claim of the railways on the community was indisputable. It will not be their fault if the bargain they entered into with the Government should prove impracticable. Its confirmation by the House of Com- mons, if grudgingly given, was definite. But the moment they began to enforce their claim lions arose in the path. In the most favourable circumstances it would be a herculean task to readjust millions of rates to the new conditions. The announcement of an average increase of 4 per cent, is of course only a preliminary move. In every case the details will have to be gone into and duly considered. Afterwards they will have to be discussed with Chambers of Commerce, Chambers of Agriculture, municipal councils and other public bodies, to say nothing of thousands of aggrieved traders. Many of the latter will be important people whom the railways cannot afford to quarrel with. This is not by any means a matter to be settled with a stroke of the pen and a short advertisement in the news- papers. The railway companies are not going to have it all their own way, nor do they evidently expect it. There will have to be a good deal of haggling and of give and take before the new rates are definitely fixed. The general advance in rates was no sooner announced than the hornet's nest became active. Then the railway companies began to draw in their horns. First they got two or three explanatory articles published in The Times to prove that the advance was not nearly so formidable a bogey as it looked. Still the hostile agitation of the traders continued, and the next move was a partial climb down. The Times of June 21 contained a semi-official statement that "the increase was not to apply to class rates." The following extract gives the gist of the concession : — NATIONALISATION 316 " In order to make the position perfectly clear, traders and the public may be reminded that for the purpose of the practical working of the railway traffic, all goods carried, or likely to be carried, by rail are divided into classes under a recognised classification, and that the rates charged fall into two main groups: (1) class rates which, except for long distances, approximate somewhat to the maxima ; and (2) exceptional rates, which are rates for similar traffic, but are fixed on a lower basis, to meet various conditions in regard to full truck loads, large lots, etc., such exceptional rates being, as a rule, substantially below the corresponding class rates. . . . " Wliat the companies have decided to do, in order to simplify the position, is to eliminate from the increase, as announced, all trafiic that is now carried on at ordinary class rates, except in certain instances, the most important of which are the long-distance traffics between England and Wales and Scotland or Ireland, and class rates on the Scotch railways. Otherwise the increases will apply exclusively to exceptional rates. Most of the through rates (whether class or exceptional) for merchandise or produce carried from or to the Continent will be subject to the same increases." In thus limiting the advance to ** exceptional " rates, which apply mainly to heavy goods, the railway companies may be reducing the area of opposition, but they will not diminish its intensity. It is agricultural produce, build- ing materials, minerals, machinery, metal-ware, raw cotton and wool, and similar commodities that will now have to bear the brunt of the higher rates. Broadly speaking, it is the canal class of traffic that is going to be penalised, and the question will naturally arise, if an effort should not be made to relegate such traffic back to the canals. If British legislators and traders had had a shred of the foresight which the same classes have shown in Germany and France, our canals would not have been allowed to become useless derehcts. The question of reviving them has been frequently raised in an academic way, but this move of the railway companies may put heart and soul into the agitation. It has already done so, in fact, in 316 BRITISH RAILWAYS the Midlands. The Birmingham Chamber of Commerce has led off with a strong declaration against any increase of railway rates, and in favour of canal competition. For aught we know we may be entering on a new era in our methods of transportation. Unless large capacity canals are found to be impracticable from an engineering and a financial point of view, there would be much to say in their favour. A transfer of the greater part of our heavy traffic from rail to water carriage might prove to be, not only an important national economy, but a great relief to the railways, and a help to them in conducting the fast traffic, which properly belongs to them, with greater safety and efficiency. Very probably it would even now pay them to weed out some of their low-grade freight, and they will almost certainly have to do it a few years hence. This is another element in the vexed question of railway nationalisation. How long will the railway companies, as at present constituted, be able to grapple with the rapid growth of their traffic, goods and passengers alike ? The more their physical difficulties increase the larger will be the scope for political and administrative inter- ference. Conversely, the more they are interfered with and regulated the more their difficulties will multiply. The policy of official intervention is fast approaching a climax, when it will have to be decided, once for all, whether State control should not be carried to its logical issue by transferring responsibility from the controlled to the controllers. The existing hydra-headed system of supervision is becoming intolerable. The Board of Trade by itself might be endurable and even helpful. The Railway Commissioners, if costly, are perhaps a necessary evil. The House of Commons, it is to be feared, there is no escape from. But a triple combina- tion of House of Commons, Railway Commissioners and Board of Trade is too dreadful to contemplate as a permanency. By the way, what place would these incongruous authorities have in the national regime ? Could they be dispensed with, or would they not be more meddlesome than ever ? If they are to be kept on, would the change NATIONALISATION 317 from joint-stock ownership to State o\\Tiersliip not be much greater in name than in reality ? An article entitled " Railways and Traders," which appeared in the Daily Telegraph of March 12, 1913, may be here quoted as a concise summary of the peculiarities and defects of our railway law. Traders may find in it useful information as to the principal railway Acts operative at the present time, and the methods of judicial interpretation applied to them. '' What is most needed to-day, both by railways and traders, is a simple and rapid method of settling their differences. Though the United States practice is by no means perfect, it is much superior to our own in directness and simplicity. When the railroads there wish to revise their rates — and they are clamouring for it now as per- sistently as our own railway companies — ^they can go straight to the Liter-State Commerce Commission. It hears both them and the traders, and pronounces judgment accordingly. Scores of such petitions to authorise higher rates are always before the Commission, and decisions on them are being frequently given. The railroads know exactly what to do when they want a rate altered. They send in their case, and in due time get their answer. " But British practice inverts that natural course of proceeding. The railway company announces its new rate — as so many of them have done lately — and then any dissatisfied trader may take them before the Com- missioners, He appears as a complainant, and the railway company has to justify its action. This is where the complications and the fine distinctions come in. First, the desired increase must be within the maximum rates fixed according to the Act of 1894. Second, passenger traffic has to be excluded, but the Act does not say how the working expenses of passenger and goods trains are to be distinguished. Third, a sharp line is drawn at Aug. 19, 1911, and no previous advance in wages is to be allowed to count. Fourth, it has to be proved that the advance asked for is part of a general scheme to meet a particular increase in the cost of working. Next, it has to be proved that the advance is not ' on the whole greater than is reasonably required for the purpose.* 318 BRITISH RAILWAYS These cryptic provisos and qualifications wind up with a prize puzzle. * The proportion of the increase of rates or charges allocated to the particular traffic with respect to which the complaint is made must not be unreason- able.' Who is to interpret a conundrum like that ? " The new Act may indirectly serve a good purpose if it calls attention to the vagaries and diversities of our existing railway laws. They are sadly in need of revision and consolidation: so much so that this should have preceded any attempt to add to their number. Railway companies and traders would, in the writer's opinion, get on much better if they would make an honest and sincere endeavour to understand their existing legal relations. The companies, of course, are well posted on the subject. They have an army of legal and managerial experts continually engaged in studying it from their own point of view. But what is A B C to them is Greek to the ordinary trader. " If he were to tackle the subject historically he would have to wade through at least a dozen Acts of Parliament in order to settle the simplest legal point. The following are the nine most important Acts now in force : Railway and Canal Traffic Act, 1854. Railway Clauses Act, 1863. Regulation of Railways, 1873. Board of Trade Arbitration Act, 1874. Cheap Trains Act, 1883. Railway and Canal Traffic Act, 1888. Conveyance of Mails Act, 1893. Railway and Canal Traffic Act, 1894. Railways (Private Sidings) Act, 1904. " The above list is calculated to convey an exalted idea of the comprehensiveness and minuteness of Parlia- mentary supervision over railways. It shows also the tendency of this supervision to become more and more meddlesome, and its interference more frequent. In the first half -century of the railway age new railway Acts were passed only about once in a decade. In the past half-century five years has been the average interval, and now even that is considered too long. In the decade NATIONALISATION 319 1888-1897 no less than four railway Acts of historical importance got through ParHament. Two of them — those of 1888 and 1894 — still form the basis of our railway rates and classification. "It is hardly possible for any one having large dealings with the railways to do himself justice in his daily battle with them unless he has ascertained his exact legal position from the Acts themselves. By examining them consecu- tively he will be able to trace the origin and development of the pecuhar maxims of British railway administration. In the Act of 1854 he will find (Clause 2) one of the oldest and most venerable doctrines of our railway law — that of equal rates for equal services. * No such com- pany/ it says, ' shall make or give any undue or un- reasonable preference or advantage to or in favour of any particular person or company, or any particular descrip- tion of traffic, in any respect whatsoever.' " This was a brave declaration, but very feeble and costly means were provided for its enforcement. Ag- grieved traders were given the expensive privilege of applying to any of his Majesty's superior CJourts in England, Scotland, or Ireland for a writ of injunction against the offending railway. But it was worth while risking something to obtain a conviction, as the offender might be fined to the tune of £200 a day. Undue prefer- ence was the chief bogey of British traders about the middle of the nineteenth century. Ten years later working agreements came into fashion, and the Act of 1863 was specially concerned with them. It laid down rules for carrying them out, subject to the proviso that they must be approved both by the shareholders of the companies concerned and by the Board of Trade. " Skipping another ten years we come to the Act of 1873, by which the first Railway and Canal Commission was created. It also introduced two other innovations — the compulsory publication of rates and the right of the Railway Commissioners to fix terminal charges. In the language of the Act (Clause 15) they are * to decide what is a reasonable sum to be paid to any company for loading and unloading, covering, collection, delivery, and other services of a like nature.' It wa& a very lawyer-like 320 BRITISH RAILWAYS arrangement to split up terminal charges into a multitude of small details, and it has proved, as might have been expected, a very doubtful policy for the railways. If they could have decided on a reasonable scale of inclusive charges they might have spared themselves a large amount of worry and unpopularity. *' The corner-stones of our existing railway law are the Acts of 1888 and 1894. The former established a new Railway Commission, which was expected to be more commercial and less legal than its predecessor ; but so far the difference between them has been undistinguishable. Business men still wait longingly for their ideal court of law, which is to combine justice with common sense. The new Commission, moreover, had the advantage of the old one in enjojdng a much wider jurisdiction. The number of local authorities entitled to act as complainants was greatly enlarged. It now includes any association of traders or freighters, or Chamber of Commerce or Agriculture, as may, in the opinion of the Board of Trade, * be a proper body to make such complaint.' From every point of view and the traders' especially, it is a complex and confused foundation on which a nationalis- ing pohcy would have to be built up. Such policies may be easy to talk about, but let the talkers, whether they be trading or trade-union grievance-mongers, ask them- selves where they would begin their revolution. As the above sketch indicates, there are many tangles to straighten out before we can venture to launch into electioneering experiments with a railway system which owes its greatest virtues to private enterprise and its worst faults to the politicians. Richard Clay di Son; Ltd., London and Bungay. VAN NOSTRANDS "WESTMINSTER" SERIES Bound in Uniform Style. Fully Illustrated. Price $2.00 net each. Gas Engines. By W. J. Marshall, Assoc. M.I.Mech.E., and Capt. H. Riall Sankey, R.E. (Ret.). M.Inst.C.E., M.I.Mech.E. 300 Pages, 127 Illustrations. List of Contents : Theory of the Gas Engine. The Otto Cycle. The Two Stroke Cycle. Water Cooling of Gas Engine Parts. Ignition. Operating Gas Engines. The Arrangement of a Gas Engine Instal- lation. The Testing of Gas Engines. Governing. Gas and Gas Producers. Index. Textiles. By A. F. Barker, M.Sc, with Chapters on the Mercerized and Artificial Fibres, and the Dyeing of Textile Materials by W. M. Gardner, M.Sc, F.C.S. ; Silk Throwing and Spinning, by R. Snow ; the Cotton Industry, by W. H. Cook ; the Linen Industry, by F. Bradbury. 370 Pages. 86 Illustrations. Contents : The History of the Textile Industries ; also of Textile Inventions and Inventors. The Wool, Silk, Cotton, Flax, etc.. Growing Industries. The Mercerized and Artificial Fibres em- ployed in the Textile Industries. The Dyeing of Textile Materials. The Principles of Spinning. Processes preparatory to Spinning. The Principles of Weaving. The Principles of Designing and Colouring. The Principles of Finishing. Textile Calculations. The Woollen Industry. The Worsted Industry. The Dress Goods, Stuff, and Linings Industry. The Tapestry and Carpet Industry. Silk Throwing and Spinning. The Cotton Industry. The Linen Industry historically and commercially considered. Recent Developments and the Future of the Textile Industries. Index. Soils and Manures. By J. Alan Murray, B.Sc. 367 Pages. 33 Illustrations. Contents : Introductory. The Origin of Soils. Physical Proper- ties of Soils. Chemistry of Soils. Biology of Soils. Fertility. Principles of Manuring. Phosphatic Manures. Phosphonitro- genous Manures, Nitrogenous Manures. Potash Manures. Compound and Miscellaneous Manures. General Manures. Farm- yard Manure. Valuation of Manures. Composition and Manural Value of Various Farm Foods. ( I ) THE '^WESTMINSTER" SERIES Coal. By James Tonge, M.I.M.E., F.G.S., etc. (Lecturer on Mining at Victoria University, Manchester). 283 Pages. With 46 Illustrations, many of them showing the Fossils found in the Coal Measures. List of Contents : History. Occurrence. Mode of Formation of Coal Seams. Fossils of the Coal Measures. Botany of the Coal-Measure Plants. Coalfields of the British Isles. Foreign Coalfields. The Classification of Coals. The Valuation of Coal. Foreign Coals and their Values. Uses of CotI. The Production of Heat from Coal, Waste of Coal. The Preparation of Coal for the Market. Coaling Stations of the World. Index. Iron and Steel By J. H. Stansbie, B.Sc. (Lend.), F.I.C. 385 Pages. With 86 Illustrations. List of Contents : Introductory, Iron Ores. Combustible and other materials used in Iron and Steel Manufacture. Primitive Methods of Iron and Steel Production. Pig Iron and its Manu- facture. The Refining of Pig Iron in Small Charges. Crucible and Weld Steel. The Bessemer Process. The Open Hearth Process. Mechanical Treatment of Iron and Steel. Physical and Mechanical Properties of Iron and Steel. Iron and Steel under the Microscope. Heat Treatment of Iron and Steel. Elec- tric Smelting. Special Steels. Index. Timber* By J. R. Baterden, Assoc.M.Inst.C.E. 334 Pages. 54 Illustrations. Contents : Timber. The World's Forest Supply. Quantities of Timber used. Timber imports into Great Britain. European Timber. Timber of the United States and Canada. Timbers of South America, Central America, and West India Islands. Tim- bers of India, Burma, and Andaman Islands. Timber of the Straits Settlements, Malay Peninsula, Japan and South and West Africa. Australian Timbers. Timbers of New Zealand and Tasmania. Causes of Decay and Destruction of Timber. Seasoning and Impregnation of Timber. Defects in Timber and General Notes. Strength and Testing of Timber. " Figure " in Timber. Appendix. Bibliography. Natural Sources of Power. By Robert S. Ball, B.Sc, A.MJnst.C.E. 362 Pages. With 104 Diagrams and Illustrations. Contents : Preface. Units with Metric Equivalents and Abbre- viations. Length and Distance. Surface and Area. Volumes. Weights or Measures. Pressures. Linear Velocities, Angular Velocities. Acceleration. Energy. Power. Introductory Water Power and Methods of Measuring. Application of Water Power to the Propulsion of Machinery. The Hydraulic Turbine. { 2 ) THE "WESTMINSTER" SERIES Various Types of Turbine. ConstriKtion of Water Power Plants. Water Power Installations. The I^ei-ulation of Turbines. Wind Pressure, Velocity, and Methods of Measuring. The Application of Wind Power to Industry. The Modern Windmill. Con- structional Details. Power of Modern Windmills. Appendices, A,B,C Index. Electric Lamps. By Maurice Solomon, A.C.G.I., A.M.I.E.E. 339 Pages. 112 Illustrations. Contents: The Principles of Artificial Illumination. The Produc- tion of Artificial Illumination. Photometry. Methods of Testing. Carbon Filament Lamps. The Nemst Lamp. Metallic Filament Lamps. The Electric Arc. The Manufacture and Testing of Arc Lamp Carbons. Arc Lamps. Miscellaneous Lamps. Compari- son of Lamps of Different Types. Liquid and Gaseous Fuels^ and the Part they play in Modern Power Production. By Professor Vivian B. Lewes, F.I.C, F.C.S., Prof, of Chemistry, Royal Naval College, Greenwich. ,350 Pages. With 54 Illustrations. List of Contents : Lavoisier's Discovery of the Nature of Com- bustion, etc. The Cycle of Animal and Vegetable Life. Method of determining Calorific Value. The Discovery of Petroleum in America. Oil Lamps, etc. The History of Coal Gas. Calorific Value of Coal Gas and its Constituents. The History of Water Gas. Incomplete Combustion. Comparison of the Thermal Values of our Fuels, etc. Appendix. Bibliography. Index. Electric Power and Traction. By F. H. Davies, A.M.I.E.E. 299 Pages. With 66 Illustrations. List of Contents : Introduction. The Generation and Distri- bution of Power. The Electric Motor. The Application of Electric Power. Electric Power in Collieries. Electric Power in Engineering Workshops. Electric Power in Textile Factories. Electric Power in the Printing Trade. Electric Power at Sea. Electric Power on Canals. Electric Traction. The Overhead System and Track Work. The Conduit System. The Surface Contact System. Car Building and Equipment. Electric Rail- wajrs. Glossary. Index. Decorative Glass Processes. By Arthur Louis DuTHiE. 279 Pages. 38 Illustrations. Contents : Introduction. Various Kinds of Glass in Use : Their Characteristics, Comparative Price, etc. Leaded Lights. Stained Glass. Embossed Glass. Brilliant Cutting and Bevelling. Sand- Blast and Crystalline Glass. Gilding. Silvering and Mosa/c. Proprietary Processes. Patents. Glossary. ( 3 ) THE " WESTMINSTER '* SERIES Town Gas and its Uses for the Production of Light, Heat, and Motive Power. By W. H. Y. Webber, C.E. 282 Pages. With 71 Illustrations. List of Contents : The Nature and Properties of Town Gas. The History and Manufacture of Town Gas. The Bye-Products of Coal Gas Manufacture. Gas Lights and Lighting. Practical Gas Lighting. The Cost of Gas Lighting. Heating and Warm- ing by Gas. Cooking by Gas. The Healthfulness and Safety of Gas in all its uses. Town Gas for Power Generation, including Private Electricity Supply. The Legal Relations of Gas Sup- pliers, Consumers, and the Public. Index. Electro-Metallurgy. By J. B. C. Kershaw, F.I.C. 318 Pages. With 61 Illustrations. Contents : Introduction and Historical Survey. Aluminium. Production. Details of Processes and Works. Costs. Utiliza- tion. Future of the Metal. Bullion and Gold. Silver Refining Process. Gold Refining Processes. Gold Extraction Processes. Calcium Carbide and Acetylene Gas. The Carbide Furnace and Process. Production. Utilization. Carborundum. Details of Manufacture. Properties and Uses. Copper. Copper Refin- ing. Descriptions of Refineries. Costs. Properties and Utiliza- tion. The Elmore and similar Processes. Electrolytic Extrac- tion Processes. Electro-Metallurgical Concentration Processes. Ferro-alloys. Descriptions of Works. Utilization. Glass and Quartz Glass. Graphite. Details of Process. Utilization. Iron and Steel. Descriptions of Furnaces and Processes. Yields and Costs. Comparative Costs. Lead. The Salom Process. The Betts Refining Process. The Betts Reduction Process, White Lead Pro- cesses. Miscellaneous Products. Calcium. Carbon Ri.ulphide. Carbon Tetra-Chloride. Diamantine. Magnesium. Phosphorus. Silicon and its Compounds. Nickel. Wet Processes. Dry Processes. Sodium. Descriptions of Cells and Processes. Tin, Alkaline Processes for Tin Stripping. Acid Processes for Tin Stripping. Salt Processes for Tin Stripping. Zinc. Wet Pro- cesses. Dry Processes. Electro-Thermal Processes. Electro Galvanizing. Glossary. Name Index. Radio-Telegraphy. By C. C. F. Monckton, M.I.E.E. 389 Pages. With 173 Diagrams and Illustrations. Contents : Preface. Electric Phenomena. Electric Vibrations. Electro-Magnetic Waves. Modified Hertz Waves used in Radio- Telegraphy. Apparatus used for Charging the Oscillator. The Electric Oscillator : Methods of Arrangement, Practical Details. The Receiver : Methods of Arrangement, The Detecting Ap- paratus, and other details. Measurements in Radio-Telegraphy, The Experimental Station at Elmers End : Lodge-Muirhead System. Radio - Telegraph Station at Nauen : Telefunken System. Station at Lyngby : Poulsen System. The Lodge- ( 4 ) THE "WESTMINSTER" SERIES Muirhead System, the Marconi System, Telefunken System, and Poulsen System. Portable Stations. Radio-Telephony. Ap- pendices : The Morse Alphabet. Electrical Units used in this Book. International Control of Radio-Telegraphy. Index. India-Rubber and its Manufacture, with Chapters on Gutta-Percha and Balata. By H. L. Terry, F.I.C., Assoc. Inst. M.M. 303 Pages. With Illustrations. List of Contents : Preface. Introduction : Historical and General. Raw Rubber. Botanical Origin. Tapping the Trees. Coagulation. Principal Raw Rubbers of Commerce. Pseudo- Rubbers. Congo Rubber. General Considerations. Chemical and Physical Properties. Vulcanization. India-rubber Planta- tions, India-rubber Substitutes. Reclaimed Rubber. Washing and Drying of Raw Rubber. Compounding of Rubber. Rubber Solvents and their Recovery, Rubber Solution, Fine Cut Sheet and Articles made therefrom. Elastic Thread, Mechanical Rubber Goods. Sundry Rubber Articles. India-rubber Proofed Textures. Tyres. India-rubber Boots and Shoes, Rubber for Insulated Wires. Vulcanite Contracts for India-rubber Goods. The Testing of Rubber Goods. Gutta-Percha. Balata. Biblio- graphy. Index. The Railway Locomotive* What It Is, and Why It is What It Is. By Vaughan Pendred, M.Inst.M.E., Mem.Inst.M.I. 321 Pages. 94 Illustrations. Contents : The Locomotive Engine as a Vehicle — Frames. Bogies, The Action of the Bogie. Centre of Gravity. Wheels. Wheel and Rail. Adhesion. Propulsion. Counter-Balancing. The Loco- motive as a Steam Generator — The Boiler, The Construction of the Boiler, Stay Bolts. The Fire-Box. The Design of Boilers. Combustion. Fuel. The Front End. The Blast Pipe. Steam Water. Priming. The QuaUty of Steam. Superheating. Boiler Fittings. The Injector. The Locomotive as a Steam Engine — Cylinders and Valves. Friction. Valve Gear. Expansion. The Stephenson Link Motion. Walschaert's and Joy's Gears. SUde Valves. Compounding. Piston Valves. The Indicator. Ten- ders. Tank Engines, Lubrication. Brakes. The Running Shed. The Work of the Locomotive. Glass Manufacture. By Walter Rosenhain, Superin- tendent of the Department of Metallurgy in the National Physical Laboratory, late Scientific Adviser in the Glass Works of Messrs. Chance Bros. & Co. 280 Pages. With Illustrations. Contents : Preface. Definitions. Physical and Chemical Qualities, Mechanical, Thermal, and Electrical Properties. Transparency ( 5 ) THE "WESTMINSTER" SERIES and Colour. Raw materials of manufacture. Crucibles and Furnaces for Fusion. Process of Fusion. Processes used in • Working of Glass. Bottle. Blown and Pressed. Rolled or Plate. Sheet and Crown. Coloured. Optical Glass : Nature and Properties, Manufacture. Miscellaneous Products. Ap- pendix. Bibliography of Glass Manufacture. Index Precious Stones. By W. Goodchild, M.B., B.Ch. 319 Pages. With 42 Illustrations. With a Chapter on Artificial Stones. By Robert Dykes. List of Contents : Introductory and Historical. Genesis <-{ Precious Stones. Physical Properties. The Cutting and Polish- ing of Gems. Imitation Gems and the Artificial Production of Precious Stones. The Diamond. Fluor Spar and the Forms of Silica. Corundum, including Ruby and Sapphire. Spinel and Chrysoberyl. The Carbonates and the Felspars. The Pyroxen2 and Amphibole Groups. Beryl, Cordierite, Lapis Lazuli and the Garnets. Olivine, Topaz, Tourmaline and other Silicates. Phos- phates, Sulphates, and Carbon Compounds, INTRODUCTION TO THE Chemistry and Physics of Building Materials. By Alan E. Munby, M.A. 365 Pages. Illustrated. Contents : Elementary Science : Natural Laws and Scientific In- vestigations. Measurement and the Properties of Matter. Air and Combustion. Nature and Measurement of Heat and Its Effects on Materials. Chemical Signs and Calculations. Water and Its Impurities. Sulphur and the Nature of Acids and Bases. Coal and Its Products. Outlines of Geology. Building Materials : The Constituents of Stones, Clays and Cementing Materials. Clas- sification, Examination and Testing of Stones, Brick and Other Clays. Kiln Reactions and the Properties of Burnt Clays. Plasters and Limes. Cements. Theories upon the Setting of Plasters and Hydraulic Materials. Artificial Stone. Oxychloride Cement. Asphaite. General Properties of Metals. Iron and Steel. Other Metals and Alloys. Timber. Paints: Oils, Thinners and Varnishes ; Bases, Pigments and Driers. Patents, Designs and Trade Marks : The Law and Commercial Usage. By Kenneth R. Swan, B.A. (Oxon.), of the Inner Temple. Barrister-at-Law. 402 Pages. Contents : Table of Cases Cited— Pay/ /. — Letters Patent. Intro- duction. General. Historical. I., II., III. Invention, Novelty, ( (^ ) THE " WESTMINSTER *' SERIES Subject Matter, and Utility the Essentials of Patentable Invention. IV. Specification. V. Construction of Specification. VI. Who May Apply for a Patent. VU. Application and Grant. VIII. Opposition. IX. Patent Rights. Legal Value. Commercial Value. X. Amendment. XI. Infringement of Patent. XII. Action for Infringement. XIII. Action to Restrain Threats. XIV. Negotiation of Patents by Sale and Licence. XV. Limita- tions on Patent Right. XVI. Revocation. XVII. Prolonga- tion. XVIII. Miscellaneous. XIX. Foreign Patents. XX. Foreign Patent Laws : United States of America. Germany. France. Table of Cost, etc., of Foreign Patents. Appendix A. — I. Table of Forms and Fees. 2. Cost of Obtaining a British Patent. 3. Convention Countries. Part II. — Copyright in Design. Introduction. I. Registrable Designs. II. Registra- tion. III. Marking. IV. Infringement. Appendix B. — i. Table of Forms and Fees. 2, Classification of Goods. Part III. — Trade Marks. Introduction. I. Meaning of Trade Mark. II. Qualification for Registration. III. Restrictions on Regis- tration. IV. Registration. V. Effect of Registration. VI. Miscellaneous. Appendix C. — Table of Forms and Fees. Indices. I. Patents. 2. Designs. 3. Trade Marks. The Book: Its History and Development. By Cyril Davenport, V.D., F.S.A. 266 Pages. With 7 Plates and 126 Figures in the text. List of Contents : Early Records. Rolls, Books and Book bindings. Paper. Printing. Illustrations. Miscellanea. Leathers. The Ornamentation of Leather Bookbindings without Gold. The Ornamentation of Leather Bookbindings with Gold. Bibliography. Index. The Manufacture of Paper. By R. W. Sindall, F.C.S., Consulting Chemist to the Wood Pulp and Paper Trades ; Lecturer on Paper-making for the Hertfordshire County Council, the Bucks County Council, the Printing and Stationery Trades at Exeter Hall (1903-4), the Institute of Printers ; Technical Adviser to the Government of India, 1905. 275 Pages. 58 Illustrations. Contents : Preface. List of Illustrations. Historical Notice. Cel- lulose and Paper-making Fibres. The Manufacture of Paper from Rags, Esparto and Straw. Wood Pulp and Wood Pulp Papers. Brown Papers and Boards. Special kinds of Paper. Chemicals used in Paper-making. The Process of " Beating." The Dye- ing and Colouring of Paper Pulp. Paper Mill Machinery. The Deterioration of Paper. Bibliography. Index. ( 7 ) THE "WESTMINSTER" SERIES Wood Pulp and its Applications. By C. F. Cross, B.Sc, F.I.C., E. J. Bevan, F.I.C, and R. W. Sindall, F.C.S. 266 pages. 36 Illustrations. Contents: The Structural Elements of Wood. Cellulose as a Chemical. Sources of Supply. Mechanical Wood Pulp. Chemical Wood Pulp. The Bleaching of Wood Pulp. News and Printings. Wood Pulp Boards. Utilisation of Wood Waste. Testing of Wood Pulp for Moisture. Wood Pulp and the Textile Industries. Bibliography. Index. Photography: its Principles and Applications. By Alfred Watkins, F.R.P.S. 342 pages. 98 Illus- trations. Contents : First Principles. Lenses. Exposure Influences. Prac- tical Exposure. Development Influences. Practical Develop- ment. Cameras and Dark Room. Orthochromatic Photography. Printing Processes. Hand Camera Work. Enlarging and Slide Making. Colour Photography. General Applications. Record Applications, Science Applications. Plate Speed Testing. Pro- cess Work. Addenda. Index. IN PREPARATION. Commercial Paints and Painting. By A. S. Jenn- ings, Hon. Consulting Examiner, City and Guilds of London Institute. Brewing and Distilling. By James Grant, F.S.C ( 8 ) UNIVERSITY OF CALIFORNIA LIBRARY BERKELEY Return to desk from which borrowed. This book is DUE on the last date stamped below. ^^^o^3S •81953 LU t\ .— •W-' »— ' MAYl 1960 2aiVlay'60FK RECD LD 25 I9b9 MAY 6 I960 tSIWay'eOGM Ot 3Jan'6lOM r:ic'd ld MAY -^ 1961 fN9TACIU< ,^^^'' yT251953 A^C'b LUREC'D LD FEB •^'5 mn5'63-7PM 26May'6lMM FiECD LD MAY 1 2 1961 LD 21-100m-7,'52(A2528sl6)476 L^ ^P ^SQAO UNIVERSITY OF CALIFORNIA LIBRARY >