OUR RAILWAYS.

Lyttelton Times, Volume LXXVI, Issue 9466, 15 July 1891, Page 6

OUR RAILWAYS.

[Communicated.] 111. The Railway Commissioners might with great advantage study a literary contribution from Mr J. Stephen Jeans (who is not one of those popular writers ’to whom Mr Maxwell took such strong exception), which appeared in the September number of the Nineteenth Century, under the heading of “American Railways and British Farmers.” Mr Jeans contrasts the results of the British and American railways; and hia remarks are peculiarly applicable to the case of the New Zealand railways. He Shows that the low freight rates of the American railways have greatly stimulated . traffic, while the high freight rates of the British lines, if they have not hindered absolutely the development of traffic, have kept it from assuming the proportions that it otherwise would probably have attained, and to that extent interfered with the general development and prosperity of the'country. The following extract referring to the British railway management may also be fairly applied to the Railway Commissioners here“ Their policy has hitherto been to arbitrarily keep up rates to a point which they fix among themselves, as being the amount the traffic will bear. This point, in their estimation, is not the irreducible minimum so generally adopted on the American lines, but the practicable maximum—practicable, that is, in view of retaining, or, at any rate, not immediately destroying the traffic.*? Mr Jeans goes on to say. “Broadly stated, the position of the railroads of the United States is simply this. The average rate charged and received per ton per mile for the transport of, all descriptions of traffic has been reduced from 2’164 cents (l-082d) in IB6o‘to *9l cent (-455 d) in 1888. This amounts to a reduction of •627 d per ton per mile, or nearly 60 per cent; and itmeant that if the traffic carried on the railroads in-1888 had paid tho same average ton-mile rate as they did twenty years before, the people of that country would have been charged for the tranaportatiou of the products of their fields, factories, and mines about £192,000,000 sterling more than they actually did pay in that year. If the remarkable fall of rates that has occurred on American railways had been a fall from ah abnormally high level, the extent and the effect pf the reduction would have been much less surprising than-they ; actually are. But the rata of 1869 was hot Exceptionally high; on the contrary, it was considerably under the ton-mile rate in England at the present time, and it was much under the average rate of ten years before in the United States.” It is, therefore, demonstrated that it is possible to give substantial abatements on rates already fairly low, with results that are proved beneficial alike to traders and railway companies. It has been the gradual cheapening of the cost of transport that has brought about the enormous traffic on the American railways. The American railways in 1888 carried a larger volume of traffic than all the railways of the Continent of Europe taken together and including Russia. * * * They carried about ten tons per head, of the population, as compared with only seven tons per head in the United Kingdom, four tons per head in Germany, and three tons per head in France. “ This enormous development of traffic has naturally benefited the community as a whole, even if the cheap rates at which it was carried have temporarily lowered the net receipts of the railways. That this latter result has occurred is not to be denied. Tho dividends paid have become more attenuated every year. In 1872 the average percentage of net earnings on capital expenditure was rather over 5 per cent; in 1888 the return, similarly ascertained and expressed, was only about 3-1 per cent. But it is not a little remarkable that some of the! leading railways, with the lowest rates of freight, have had the highest rates of dividend. The most important railway system, not in the United States alone, but in the whole world, is that known as the Pennsylvania railway; This wonderful fabric, with some 4000 miles pf line, had in 1887 a gross income of £23,300,000, carried 113$ million tons of traffic, and over 74 millions of passengers. (The Melbourne passenger traffic in 1890 was over 71 millions.) And yet the Company was content with an average rata of *34d per ton per mile, and an average profit of ‘lod per ton per mile, which is approximately less than one-third the average freight rate charged in the United Kingdom, and less than one-fifth the average profit charged on British railways per ton per mile. Did the Company, in consequence, go into liquidation ? Not a bit of it. They paid a 5 per cent dividend all round and carried £330,000 to the credit of profit and loss.” Possibly the New Zealand Railway Commissioners may say that the conditions of the American and New Zealand railway traffic are entirely different (this will be somewhat inconsistent, remembering Mr Maxwell’s recent, utterances), more particularly in regard to the population, but it cannot be denied that the principle of cheap rates on the American railways has created traffic, and resulted in their exceptional success; Besides this, che cheap railway rates have greatly assisted in the settlement of the country. Tho comparison with the European linos, whore the population is larger, is entirely in favour of the American lines.