Popular Science Monthly/Volume 30/March 1887/Are Railroads Public Enemies? I

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Popular Science Monthly Volume 30 March 1887  (1887) 
Are Railroads Public Enemies? I
By Appleton Morgan
 

THE

 

POPULAR SCIENCE

 

MONTHLY.



MARCH, 1887.



ARE RAILROADS PUBLIC ENEMIES?
By APPLETON MORGAN.

THE American Railroad, as an institution, is not immaculate. Its general offices are no more insured against entrance of designing and wickedly-minded men than is the pulpit, the Sunday-school, or the strawberry-festival. Granted, however, that, like most human concerns, the American railroad needs reformation, the very considerable question arises, Where shall we look for the reformer? It has not yet come, perhaps, to be a principle in economics that the safest and most expert administrator of a specialty is the one who has had the least practical experience thereof. But there nevertheless appears to be, if not an exact enunciation of such a principle, a by no means unusual tendency to such a practice. A great transatlantic steamship, en route from shore to shore, or a limited express train, with its costly freightage of packed Pullman, express, and baggage carriages, easily represents millions in money value, besides its human freightage. The captain, the conductor, the engineers, and crew are picked men, raised to their several responsibilities through every lower grade of drill and experience, adapted each to his part by long usuetude: who have been intrusted with all this precious burden by those who must answer with their fortunes, their liberty even, for the waste of its loss. Let the great steamship founder, the limited crash through a trestle—living or dead, these men will be found at their posts. But there will never fail of gifted gentlemen, eminent conversationalists, ready writers to the newspapers, who happened to be in their downy beds while these men were perishing, but who, nevertheless, will tell us exactly what this company and their picked employés should have done, and how the catastrophe might have been avoided. The design of this paper is to call attention to a recent capital instance of this tendency.

The problem of railway management and operation has grown so intricate; so vast, so complicated and enormous, that it is a maxim that no one man, whatever his habitude, knows "how to run a railroad." The executive officer, the auditor, superintendent or actuary of twenty-five years' service, instead of having kept abreast of his employment, finds that his service has outgrown him, not in fact alone, but in proportion; and that he can deal with remote details only "when concreted by his subordinates into results which in turn are his details. He is himself only the pendulum of the clock-work, the governor of the engine; without his co-operatives and assistants he is powerless, although at the outset of his quarter-century he may have been equal to every item of his department.

Take a single trunk line connecting the city of New York with that Western focus to which, like Rome, all roads lead—Chicago. Every one of its army of eighty thousand employés knows his duty: his duty, often duplicated, perhaps, yet not duplicated, since every item of circumstance must daily and hourly vary it. From the president to the track-walker, no single individual could justify his employment for an instant, did he not, besides his routine, know precisely the single and only proper thing to do to save life and property in any contingency, foreseen or unforeseen; and, moreover, how in the performance not to swerve one atom below or above his exact prerogative. And if—in operation, the reciprocal duties of these eighty thousand must be exactly and incessantly performed in order that every passenger and every pound of freight shall reach its debarkation in safety—what single mind can grasp the relation of numberless such trunk-lines to the great public who trust their lives, persons, and property to them all? Add to this situation that this public, having largely invested their fortunes in these very transporting lines, are dependent for its incomes from their prosperity. Does not the great ramification strike us as one rather too enormous for any single recipe to meet, or to be guided by any one infallible and inexorable rule of constant and rigid procedure?

There is not a single criticism of railway management or outbreak of popular anti-railway feeling which has not its own perfectly well-known periodicity. As a rule, they lapse with time and disappear without exposition. But that all these criticisms and complaints should be carefully clipped, hoarded, pasted together, and sent out as a monograph signed by one name, is an occurrence so exceptional that its occasion might seem to warrant a replication to the array, once for all. Such an occasion seems the appearance of a handsome volume from an eminent press, which not only deals with the entire problem above suggested as a whole (the "Railways and the Republic," by James F. Hudson, New York, 1886), but impresses further as compiled by a gentleman who not only has never been engaged in the management of railways, operatively or financially, but has never discovered, in all the immense delicacy of mechanism which moves 8,778,581,061 of people one mile, and billions of dollars' worth of treasure in every direction across and along a continent in a single year, and supports a property representing 87,676,399,054 of securities, a single point for his admiration or even for his approval.

Archimedes had the world for a load and natural science for a lever; but even Archimedes was obliged to sigh for a place whereon to plant bis fulcrum. It appears to me that, in this laborious work of five hundred closely printed octavo pages, what Mr, Hudson lacks most of all is a standpoint. He has a load, he has a grievance for a lever, but, since he can not himself float in space, he makes no impression on what he claims to be the burden to be moved. Mr. Hudson's want of standpoint is prominent at his very outset in his very title-page. He calls his book "The Railways and the Republic," thus antagonizing his two terms. But the grouping is vicious, to begin with; since railroads, whether regarded as legal entities or as companies of individuals, are as much part and parcel of the republic as is Mr. Hudson himself. Starting upon this false major premise, Mr. Hudson proceeds in the first of his eleven chapters to give us the indictment, the remaining ten to be the counts of the particulars.

The title given to this indictment, "The Problem of Railway Domination," is again illicit. Where is the "domination" to be eliminated? Frankly admitting that the present writer believes that railways belong to the persons whose money has built or purchased them, and that their quasi-public character is justified and satisfied by their honest performance, by the best methods that applied science up to date has furnished, of the duties of public transportation, he proposes from this standpoint to examine: first, Mr. Hudson's indictment as a whole, passing thereafter—as far as the limits of a single paper will allow—to the particulars exhibited.

According to Mr. Hudson, the railways of the United States either "dominate" at present, or propose sooner or later to "dominate," the republic. How? By being "gigantic monopolists," says Mr. Hudson. And how do they become gigantic monopolists? By being gigantic corporations, controlled by men of altogether too enormous private fortunes. Now, we have always known that a railway was a corporation, and that some of our railways might fairly be called "gigantic." But there is not one of these "gigantic" corporations which is, in any sense of the term known to dictionaries at least, a monopoly. To be exactly all-fours with the lexicographers, the only railways in the Union which are monopolies are countable on the fingers of one hand, and must be as insignificant in extent, capitalization, importance of terminals and every other characteristic, as they are in number. Everybody knows that a shipper or traveler from New York to any point in the United States has an abundant choice of routes before him. Whether his objective be Buffalo, New Orleans, or San Francisco, or any city or town large enough to make a dot on the map, or any one of the ten thousand points reachable from every one of these, there are certainly half a dozen lines of railway at his option; and if there are two points in the United States between which there is but one means of transportation, it is because the points themselves are of such exceedingly minor importance that a second means has entirely failed to be a temptation to local capitalists. I once happened upon a railroad on the top of the Alleghany Mountains, five miles in length, called the Wilcox and Burning-Well Railroad, running between a tannery and a saw-mill, which—as there was no other means of going from one to the other except by taking an axe and a compass and tempting the aboriginal forest—might, I think, be fairly called a monopoly, especially since the owner of the railroad was also the owner of both the terminal tannery and the terminal saw-mill. But the great majority of American railways are, just now, competitors rather than monopolists, and, if gigantic at all, are gigantic competitors. It is to be admitted, of course, that to construct, maintain, and operate a "gigantic" railway, gigantic corporations may not be unnecessary.

Now, railways "dominate," says Mr. Hudson, by being these gigantic corporations against which units have no chance. But just as capital is the storage of labor, so a corporation is the aggregate of units, and if units can combine to "dominate" other and uncombined units, why can not these other units combine to resist the domination? Mr. Hudson does not recognize such a question, suggests no device by which the unit unassisted by capital can equal in strength the unit when so assisted, nor any reason why the units incorporated for transportation purposes should not compete for the transportation business of the units not incorporated for transportation purposes. This word "competition," however, is no favorite of Mr. Hudson's. He immensely prefers "domination": and properly so, too, since in the employment of the latter word lie not only his premises, but the conclusions at which he assumes to arrive. The railways, concreted, "dominate" the republic (that is to say, all the United States except the railways), and therefore, since they "dominate" by doing the transportation business of those not in that business, the only safety is to reverse the situation, so that the units not incorporated for transportation purposes should hereafter dominate the units who are so incorporated. In other words: Let our railroads, by all means, be run by men who do not understand railroading, and let those who do understand the running of railroads step down and out at once.

But why should those individually concerned in railway management step down and out? Why, says Mr. Hudson, because several of them have accumulated enormous fortunes; fortunes fabulous, even when compared with all the other private fortunes in the world. But whence come these ten or a dozen (if so many) vast fortunes? Why, say's Mr. Hudson, with admirable circumferentiality, from the domination of railways. Clearly we must get this kernel out of Mr. Hudson's crop if we are to proceed with him any further: and to dispose of it may require a moment or two of our attention.

The greatest of powers, undoubtedly, is the human brain; and, so long as it is the instinct of man to scheme for his own aggrandizement, certainly the greatest brain will scheme to the greatest profit to himself. A dozen men in the United States have been able to amass, from management (or, if the word is preferred, manipulation) of the railway systems of the country, the largest single fortunes known to history: not in land, in interests in estimated wealth, but in actual comfortable, convertible cash, representing no manual labor of their own, no commensurate investment of capital, and no proportional benefit to the race. But, because Mr. Hudson is virtuous, are there to be no more cakes and ale? Because Mr. Gould is very rich, are there to be no more railway companies? Because these dozen fortunes are beyond any heretofore conceived relation of reward for personal industry, is the material by manipulation of which they have been accumulated, noxious, bad in itself, and dangerous to the common weal? These fortunes are, for our present purpose, the pure result of brain-labor, the rewards of pure thought. Let us leave out of the reckoning whether they are honest or dishonest fortunes; or, if Mr. Hudson prefers, let us concede them to be dishonest. The fact, the only fact, necessary to the discussion of his own questions on his own ground is that they have been accumulated by the purchase, manipulation, and operation of railways. The people make the laws, not the railroads. To argue that railroads, quoad railroads, are hateful to public policy, dangerous to the public peace, threatening to public morals, and destined in time to destroy the commonwealth, as private luxury once destroyed old Rome, seems to me the simple fallacy which logicians call an "undistributed middle." As well condemn any other thing because at some time something of its species has been manipulated to a personal and exorbitant profit. Banish corn, wheat, or coal, because great "corners" have been planned in those staples, and hundreds of thousands of consumers obliged to pay more than they ought to have paid, when a few schemers, who had schemed for months, had suddenly sprung upon these unsuspecting thousands their long-perfected plans!

Shakespeare makes one of his characters put the question, "How do men live? "and another answers it: "Marry, as the fishes in the sea, the big ones eat up the little ones." The struggle for existence which our brute ancestors carried on with teeth and claws and fangs, we still perpetuate with interlocked and grappling brains. They strove and tore and trampled each other for the food their bellies craved, in specie; we fight for values instead. But the result is the same: the strongest brain, as once the strongest limb, wins. And when, as within the last half-century right here in the United States, in what is scarcely more than the close of the first half-century of the railroad, a few phenomenal brains have amassed more of these values than their share, more than they can consume with their own personal wants—while I admit that the problem looks serious to those whose brains have not taken part in the struggle—the wrong seems to me one for which Nature, not art or science or schools, is at present mostly responsible, just as much as she is responsible for the lion that rends the ox, or the fox that pillages the farm-yard. The United States of America does not make treaties with individuals: and yet the treaty between the United States and the kingdom of Hawaii is, or was once, practically for the single benefit of one man. Why? Because there happens to be but one article of export from Hawaii to the United States; and because that one product happens, or happened, to be controlled by the brains and capital of one man. So this anomaly—this wrong, we suppose Mr. Hudson would call it—is to be charged to the crime of having brains, or to the domination of (not railways this time, but) sugar! Perhaps the situation can be made very clear to Mr. Hudson by a quotation from himself:

He says, page 1: "Watt could see in the steam which lifted the lid from the tea-kettle a force which might yield man some aid in his labors; but he could not foresee the immense application of that force to every phase of life. He could not dream of the millions of factories, the thousands of steamships, or the myriads of railway-trains that lay dormant in his discovery." And yet it is simply and solely because a human brain here and there did foresee what Mr. Hudson says Watt could not or did not—that massive fortunes, larger than an aggregate of thousands amassed by mere manual labor and economy, have been accumulated. Shall the owner of such a brain assume that Nature in so endowing him endowed him with a curse to his fellow-men, and that it is his natural or moral duty to devise a means of redistributing this accumulation to the two hundred thousand or hundred thousand millions who, like Watt, could not foresee? I do not so understand Mr. Hudson to urge; but perhaps he will be able to demonstrate to what other duty his satire on the men who, by building, buying, conyrolling and operating railways, amass vast properties, surely and implacably points.

The processes by which the fish with capital swallows the fish without capital—by which money attracts money, and foresight eclipses hindsight—stand possibly in bolder and nearer relief, just now, in the case of the three or five railway kings (whose fortunes may last another generation or two without division) than elsewhere. But, that they are processes unfamiliar in any given commercial undertaking or venture, I do not find any note in Mr. Hudson's indictment to assert. His indictment of railways and railway management is the constant and simple and single charge that they "dominate" the non-railway world by making the rich richer and the poor poorer; and this, principally, by piling up vast accumulations of wealth in the hands of the very few. Mr, Hudson is wary enough to see that railroads, not being per se illegal, the accident and consequence are not illegal; he, therefore, argues deftly that the railways, although legal, are illegally handled by their managers. This illegality he separates into five counts—that the transportation business, legitimate in itself, has been made pernicious to public and private rights, and "dominates" them by certain imported incidents, viz., by —

I. Land-grants.
II. Pools.
III. Construction companies.
IV. Rebates and discriminations.
V. "Fast-freight lines."

Mr. Hudson does not add to these—sleeping, hotel, and parlor-car companies, railway-lighting companies, and all the numerous other auxiliaries to modern railway management, which save the time and economize the capital, while they accommodate the patronage of railways. I know not why, but, since he has left them out of the indictment, we will follow his example. But Mr. Hudson does pause just here—by what logical process is not apparent—to fulminate to the length of many solid pages over and against the Standard Oil Company, its history, career, and the procedure by which, before the days of "pools," it was able to force favorable contracts upon the railways to its own vast advantage; accumulating thereby assets almost as enormous as either of the three or four private fortunes in which Mr. Hudson sees such imminent peril to the republic. As we are just now considering the railways, perhaps we might as well leave out the oil company. We may admit, I think, however, in passing, that the Standard Company was an accident—a thing by itself, like the moon or the Gulf Stream — from whose existence even a possibility of another can. not be predicated, since the present system of "pooling" associations would render its repetition practically impossible. Mr. Hudson is perfectly right in announcing that this great corporation is not a charity or an eleemosynary foundation of any sort; that it does business for the enrichment of its own stockholders rather than in behalf of those of its rivals: that it takes all it can get—is soulless, grasping, and selfish. That it has been engineered by men of brains until it has become in certain localities a practical monopoly may also be conceded. That, so long as the laws under which it is incorporated permit other incorporations for like purposes, it is a monopoly, legally or derivately speaking, I am afraid must be denied.

Premising merely that railways are not always the personal property of their officers, but that their ownership, as a rule, shifts with every sale of stocks made in Wall Street or on the 'Change of a dozen capitals—and that, in Mr. Hudson's formula (page .5), "of the difference of actual abuses in the railway system of the country there is little room for dispute," it were not impossible to substitute for the term "railway system of the country" the term "everything human"—let us pass to the counts of the indictment:

I. Land-Grants.—Of these Mr. Hudson says: "We might even make allowance for the men who, having received a gift of an empire of lands and money for the construction of a transcontinental railway, proceed to bribe legislators and buy up public officials to prevent adverse action as to the ratification of past donations...." (page 6). "If the Government has secured the settlement of the Western Territories, the pacification of the Indians, and quick transit to the Pacific coast, by giving the men who built the transcontinental railways the money to build the roads, and an empire of land in addition, it is still permissible to ask whether it will not suffice to present the projectors of the next enterprise with the completed railroad, without adding the millions of acres of territory to induce them to take the gift" (page 8). This is hardly in what might be termed "the scientific spirit." But let that pass. The point is, does Mr. Hudson know what a land-grant is? In the free and buoyant West, where language is as bounding and breezy as its own prairies, a land-grant is often spoken of as a "land-grab." Mr. Hudson is more choice in his phrase, and calls it simply and grandly, a gift—a "gift of empire"—but his idea appears to be much the same. If the Government makes one a gift of land, that ought to be the end of it, by every principle of morality and justice, if not of politics. The Government is just as much bound by its gifts (barring the rule of construction to be noted) as any other giver. But Mr. Hudson says it is not a gift, exactly; but "a gift... for the construction of a transcontinental railway." Those who have tried it have been heard to affirm that "the construction of a transcontinental railway" is a matter of some considerable magnitude, requiring time, perseverance, and even labor. The Government, then, makes men a gift to build a transcontinental railway much as Mr. Hudson would make a builder a gift to build Mr. Hudson a house; and Mr. Hudson will even "make allowance for" men who will bribe legislators to prevent adverse action as to ratification of such a gift as that! Bribery is an intolerable crime; of all crimes most subversive of the public weal. But if bribery were ever, or ever by any possibility could be, justifiable as a last resort, it seems to me it would be justifiable to prevent adverse action by legislators who were determined to prevent the Government from ratifying a gift of land to men who had relied upon its honor and good faith even to such a trifling extent as to build a mere transcontinental railway! If the Government gives Mr. Hudson land, surely it ought not to take it away again, ratified or unratified. But, if it it gives him land in consideration of labor and services rendered and material furnished, and he deliver the material and perform the labor and services, surely he ought not to be put to the peril of the Government's refusal to ratify the gift, or to the expense of bribing legislators. But if Mr. Hudson had received a gift of lands (and even "an empire" is not—some who have attempted it say—too great for the task) in exchange for the construction of a transcontinental railway, from the General Government, I think, on reflection, he would consider himself harshly treated if, on constructing the same, the Government should withhold ratification of its gift. And if Mr. Hudson, why not a railway company?

But what is a land-grant, or "gift of an empire," since Mr. Hudson prefers that term? To begin with, it is a devotion or dedication of a certain portion of the public domain to railway purposes. Instead of purchasing it at two or three dollars an acre, the railroad company purchased it by building a railroad; not where and when they pleased, but between certain points, perhaps even through mountain-ranges, no matter how great the difficulties or how costly the construction, tunnels or viaducts, banks or bridges; not at their leisure, but in good faith as nearly within a specified time as human industry and allowance for the uncertainty of human events, financial and physical, would permit. Surely, this is no "gift" or "grab," to begin with. But, on building this railroad, does the land thus "given" become the property of the company? Not yet. There are other details; the land must be surveyed by Government surveyors, and the company must pay the cost of the survey in cash before it can take possession. Even Government surveyors do not work for nothing, and land in its native wildness, where human foot hath scarcely trod, is not apt to recoup much of engineering expenses. Nor is this all. If there happens to be upon the "empire" of land (which is granted by the square mile, and without reference to any map, or former record of grant, by general description in terms of quantity only) any acre or plot already occupied by an individual, Indian tribe, or other company, does the Government guarantee its own "grant of empire" given to this company as a consideration for the labor, services, and material it has exhausted in building a transcontinental railway? Strange as it may seem, the Government not only does nothing of the sort, but in its own general land-office sits as arbitrator between this earlier proprietor or these earlier proprietors and its own grantee, upon its own grant; and appeals to the rule (first laid down by Lord Ellenborough) that, whereas a private grant is to be construed strictly against the grantor, a public grant, from a state to a subject, is to be construed strictly against the grantee! This matter (in which the Government's grantee is made that unusual character, a defendant with the burden of proof) is tried before the grantor Government, is heard by the commissioner whose decision is to be affirmed or reversed on another hearing before another employe of the grantor, the Secretary of the Interior. Or should the contesting proprietor or alleged proprietors elect to begin his or their action for trespass in the local State or Territorial court, it can be carried step by step up to the Supreme Court at "Washington. As a matter of fact the reports of this court teem with these cases, wherefrom the reader can imagine something of the routine litigants have undergone to get there. All these hearings and rehearings, appeals and new trials, and further appeals, have to be attended and argued by counsel in behalf of the Government's own grantee, the defendant company. And since, should the company finally secure its title to the land the Government had already granted it, it can only sell it for two or three dollars an acre, and lawyers' bills are not apt to be prepared on a diminuendo scale, the public mind can now begin to appreciate how recklessly magnanimous a "gift" this land-grant was on the part of the Government, and the extent of Mr. Hudson's charity in being able to "make allowance" for the recipients!

But the above is not all. This gift, Mr. Hudson himself admits, has to be ratified, and legislators bribed to ratify it. He would come nearer the truth did he assert that it has to be ratified at every session of Congress. I have in my mind a company whose land-grant was received considerably more than twenty years ago, and which has earned it by building and operating its entire road, and yet I doubt if the lawyers of that company could, without considerable research, mention a year in which that grant had not been a matter of attack upon the floor of Congress. Nor is it yet at rest there, although that road is operating over three thousand miles of trackage. Mr. Hudson says that the men who receive these dubious "gifts of empire" "bribe legislators and buy up public officials," to prevent adverse action as to the ratification. Doubtless he knows of what he speaks. Our legislators are elected by the people, and to the people they are responsible. But the fact that our legislators do not, as a rule, allow land-grant questions to rest, and are constantly demanding adverse action, even in cases as old as the one I have just referred to, does not look as if land-grant companies had largely added to the expense of receiving their already costly present of lands by large "bribes to legislators and purchase of public ofllicials"; for certainly they have not prevented adverse action upon these grants to any very memorable extent.

Mr. Hudson speaks of money-grants as well as land-grants to a transcontinental railroad. In the throes of a bloody civil war it is to the eternal credit of one patriotic Congress that it did vote a loan to a transcontinental railway company to enable it to connect the shores of two oceans whose communications otherwise were at the mercy of pirates and privateers, fitted out by a rival nation, interested in driving our commerce from every sea. But, with the necessity, the policy ceased forever. In other cases, to make their heavily purchased "gifts" available, the plan of mortgaging them was resorted to. They have been so mortgaged, and, on the faith of the Government, the bonds secured by these mortgages are now held by this people; this republic—whose enemies, Mr. Hudson will have us believe, all railways are. Nor is it a figure of speech to say, in this case not only, but in every case of a railroad upon which a mortgage is spread, that so far from the railway being the enemy, it is the creature of the republic, for the republic is the people, and the people, by owning the securities of a railway, own the railway itself. Mr, Hudson may fire the popular heart of the non-investor by his periods; but if, per-chance, he desires more than this, he can not yet claim to have found either a place to stand, or a fulcrum for his lever.

 

II. Pools are combinations of railways at once with and against each other, never against the public, or (if Mr. Hudson prefers) the republic. The name is unfortunate, as suggesting a pot or lump, whereas, in fact, the pool is an elaborate system of differentiation and equating, by which railroads practically pay into the pool, not their lumped receipts, but percentages thereof. These pools are the legitimate and necessary results of the rechartering over and over again of railway companies to transact business between the same points, by paralleling each other. So long as the people in their Legislatures will thus charter parallel lines serving identical points—thus dividing territory they once granted entire—it is not exactly clear how they can complain if the lines built (by money invested if not on the good faith of the people, at least in reliance upon an undivided business) combine to save themselves from bankruptcy. Without such combination the strongest company must bankrupt and "gobble" the others, which survival of the fittest would be exactly what Mr. Hudson declaims and deprecates—a Monopoly; and this time a most grasping and cruel one, since the first aim of the surviving road must logically be to recoup itself for the tremendous expenses of the "gobble" by extravagant overcharges! Had a pooling system existed at the date of its birth, the Standard Oil Company octopus could never have grown up. And it is interesting reading—as Joe Gargery would say—to find our Mr. Hudson snarling on one page at railways because they render such monopolies as the Standard Oil Company possible, and, on the next, cursing pools as against public interest. And not only are pools safeguards against private monopolies, but, as against the "tie-up" and the boycott, bound to become the needed, possibly the only, antidote if not the only relief, possible. Individuals may, and no doubt do, from geographical conditions, suffer from the absence of competition which pools guarantee. Doubtless a shipper at Buffalo could make better terms to New York were five trunk lines engaged in the suicidal pastime of cutting each other's throats. But the greatest good of the greatest number is subserved by an honest rate, and that the pool secures to it.

 

III. Construction companies are conservers of time and capital at once to the public and to the railway-builder. If a railway between two given points be needed at all, it is needed as soon as possible. The construction company, by procuring the capital, obviates the delay of resorting to individual subscriptions, and the dilatoriness of small subscribers; and, by securing a rapid building and equipment of the desired road, serves the public by affording them early transportation facilities. And if, at the same time, it secures the stockholder and builder by relieving against the reasonable probability that a railroad built to develop new territory would pass into the bondholders' or into a receiver's hands before the territory could be developed, the benefit to the stockholders ought not reasonably to be considered an offset to the benefit to the shippers.

 

IV. Rebates and discriminations are neither peculiar to railways nor dangerous to the "republic." They are as necessary and as harmless to the former as is the chromo which the seamstress or the shopgirl gets with her quarter-pound of tea from the small tea-merchant, and no more dangerous to the latter than are the aforesaid chromos to the small recipients. The trouble Mr. Hudson finds with them is that the railway systematizes them instead of granting them at random or for sentimental reasons. The quasi-public character of railways, he thinks, should make these rebates illegal. The railway, in exchange for its right of eminent domain, should listen to the wants of the whole people instead of to individuals. Undoubtedly. But the whole people are not shippers over any one railroad; nor does any one railroad draw its revenue from the whole people. Of course, I am proceeding upon the supposition that the United States Government does not propose to become a gigantic railway corporation, and add to its legislative, judicial, and executive functions the operating of 125,379 miles of railway, with a funded debt of $3,669,115,722. Did "the republic" undertake such a task, does Mr. Hudson, after reading his own book, believe that there would be no rebates or discriminations extended to anybody for political, economical, or social purposes?

 

V. The subject of "fast-freight lines" might well be dismissed in the same breath, these being a financial consideration entirely between the companies and their stockholders. It may be noted, however, that they are public accommodations, affording to large parcels the safety, care, and prompt delivery which express companies afford to small ones, and that, like the express companies, they have grown to be public necessities. They not only secure the delivery of freight at destinations beyond the receiving line, but have introduced new amenities into civilization by distributing products. By their aid the New-Yorker finds daily on his table the fruits of California, or the glorious beef from Texas grazing; and the dweller in the lake-shore States his sea-food, as if each had changed places with the grower and gatherer. Nor do the figures show an increase, but, paradoxical as it may seem, a substantial decrease in tariffs on non-perishable freights by their means.

Stripped of declamation, this is all there is of Mr. Hudson's counts: the result being, that while railroads are not philanthropic or charitable bodies, organized for good works among the poor and needy, they are not basilisks, or gorgons, or minotaurs, destroyers of the state or dragons that feed upon the people. And now we might well leave Mr. Hudson and all his works, were not his lack of standpoint just here so ludicrous as to tempt from us a further word. He cries (page 9), "Railway projectors have invariably embarked in these enterprises, not so much for the public welfare as for their own private enrichment." What else had Mr. Hudson been led to suppose? The millennial state in which private enterprises are conducted for public ends is certainly not yet a State in the Federal Union, wherever else on this planet it may be discovered. Mr. Hudson's next proposition is that, "if the country has had hundreds of millions added to its wealth by railway construction, the builders have also secured tens of millions for their individual fortunes." In any but the millennial state one would think that a free gift to the commonwealth of ninety percentum of one's profits was a rather liberal tithe, and an exceedingly handsome thing. Most private parties, certainly most governments, would open their coffers to their friends on the same terms. But Mr. Hudson is ashamed to think that private capital, enterprise, patience, and labor should have been returned anything. Clearly, the Government should take fully cent per cent for the industry of its subjects.

"While the nation has gained in wealth and population by the general extension of railways," says Mr. Hudson, "it does not follow that the wealth could not have been more justly distributed if railway management had been universally governed by the principles of equity" (page 8). What wealth? Mr. Hudson was just now complaining that the entire benefit did not go to Government, and that the individual received ten per cent. Now he regrets that it was not even more widely distributed among individuals. What are Mr. Hudson's views as to the meaning of the word "equity"? Would "equity" have been subserved if the ten per centum or the hundred per centum were distributed by lot, or on a basis of pauperism, or covered at once into the treasury of the republic? The statements that "the equality of all persons is denied by the discriminations of the corporations which the Government has created"; that "under them the increase of national wealth is not distributed among all classes according to their industry and prudence, but is concentrated among those who enjoy the favor of the railway power"; and that by means of railways "general independence and self-respect are made impossible" (page 9), may perhaps be passed over with the remark that if Mr. Hudson himself believed in propositions as silly as these, to argue with him at all would be like reading Herbert Spencer to the Salvation Array.

It is a bonne bouche to bring into the discussion at this point an allusion to the riots of 1877 in lurid juxtaposition with the French Revolution; but—since, wherever planted, the roots of neither of these cataclysms lie in land-grants, construction companies, pools, rebates, or fast-freight lines—it need not detain us here. I have not touched in this paper upon the "Granger" cases (so called), my limits forbidding. But I do not understand that the principles enunciated in them conflict with any of the statements I have made. I lately had the pleasure of perusing a learned article in an English magazine which proposed that railway companies, like post-office departments, make rates independently of distances or extent of services rendered; or at least establish two rates, "one for short distances and others for long distances: so much for every distance not exceeding one hundred miles, so much for every distance between one hundred and three hundred miles, and so much for all distances exceeding three hundred miles, keeping the one rate for all distances in view as the ultimate object." It seems to me that, if gentlemen who write in this fashion expect their papers to be read, they expect all they are entitled to. Similarly, I think that Mr. Hudson's loving treatment of the ancient claim that, since railways are public highways, any citizen has a right to send his own limited express along the line at any moment on payment of a trackage-fee, ought to stamp the value of his criticism. But since many of his terrors do very widely obtain among conscientious men, I have thought to attempt to allay them. Mr. Hudson's book is printed on better paper and more nicely bound than the usual socialistic attack upon things as they are. But that he is, or is destined to become, the long-looked-for reformer of the American railroad, I fear can hardly be hoped.

 
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