The exceptionally low rate for printed matter for the blind has been given as a measure of philanthropy. By its means, although at some loss to postal revenue, the effect of the disadvantage of bulk and weight in such printed matter, which results from the affliction, is in a large degree removed.[642]
The question of the rate to be applied to parcels is one
of considerable difficulty. While considerations of public utility would probably make it undesirable for the State to derive a profit from the business, they would hardly extend to the point of conducting a large transportation business at a loss, and the results in England and Germany show how important and difficult is the problem of fixing remunerative rates. The rates for newspapers, samples, ordinary printed matter, etc., have been accorded not solely with reference to the cost of the service, but on grounds more or less political and social as regards the fact of granting a privileged rate, and more or less empirical as regards the fixing of the actual amount of the charge. For the most part this method has answered sufficiently well, the reason being that the cost per packet is comparatively small, and the privileged traffic has not generally assumed large proportions relative to the letter traffic. These empirical methods cannot, however, be applied in the case of parcels. The expense of the service performed by the Post Office is not, as with a letter, actually small, and confined to that of collection at one end and delivery at the other end of the journey, with a negligible cost (per packet) for transmission between the points of origin and destination. Cost of transportation itself becomes an appreciable item in respect of every parcel. For this transportation the Post Office is in the main dependent on the railways, and in the determination of its cost the principles determining ordinary railway rates must necessarily apply.
Those principles are complex and to a large degree indeterminate. On the problem of railway and other transport rates many volumes have been written, and many more will yet be written before a solution is arrived at.[643] Railways,
like the Post Office, are unable to allocate the actual working costs with any degree of precision between the various kinds of service they perform. Like the Post Office, they have one general set of expenses, although they have diverse sources of revenue.[644] Even if the cost of service could in each case be definitely ascertained, its adoption as the sole basis of the rates would prove unsatisfactory.[645] For the most part the principles on which the rates are actually fixed resolve themselves into a consideration of "what the traffic will bear," that is to say, the test by actual observation and computation, strengthened, if need be, by actual experiment, of the rates which will yield the maximum advantage to the railway company.
The advantage to the railway conducted under private management may be defined to be the excess of receipts from the traffic over the out-of-pocket expenses actually incurred in handling the traffic. To obtain this maximum it has been found necessary to vary the charge according to the nature of the goods. Elaborate, detailed classifications of goods have been arranged with distinct scales of rates for each class, devised on the basis of charging each
kind of goods with the rate likely to yield to the railway the maximum of advantage as defined above.[646] Although somewhat crude and a little empirical, certainly largely arbitrary, this method has been almost universally adopted for the determination of railway charges.[647]
A characteristic feature of such charges is that account is invariably taken of the distance over which the goods are transported. In contrast with this, the principle of uniformity of rate irrespective of distance has been universally adopted in regard to all postal packets other than parcels, and to some extent for parcels. The application of the principle to parcels rests, however, on other grounds than its application to letters. Sir Rowland Hill himself never contemplated that the principle was necessarily applicable to all matter which might be sent by post.[648] The circumstances under which he made his discovery, and the facts on which he relied, make it plain that, in the absence of other overpowering considerations, the grounds advanced in the case of light letters will not justify uniformity of rate irrespective of distance for packets of
considerable weight, which necessarily involve appreciable cost for transportation. From the financial point of view, the uniform rate is, moreover, inapplicable to any class of traffic not secured to the Post Office by monopoly, since private undertakings will always step in and take away the profitable sections.