It is not too much to say that if the report and recommendations of this Committee had been acted upon in the spirit in which they were made, there would have been a revolution in the United States compared with which the Boston tea riots were a mere fleabite. As it was, no such drastic remedies were adopted. The friends of the canals were shortly found “clothed and in their right mind.” Instead of making ad misericordiam appeals for State intervention, they were soon afterwards setting their house in order. Attention was given to the increased use of steam as a propelling power, and the rates of toll were gradually reduced, until the canals were carrying much more cheaply than the railways, and in 1880 the canals were enfranchised and tolls were altogether abolished, since which time they have been able to compete with the railroads on still easier terms.
Judging by the ultimate quantities of traffic carried, there is only one opinion possible concerning the issue of this memorable struggle. The railroads have won all along the line. The total tonnage carried on the railroads of the United States in 1880 was 290,897,000 tons; the canals in the same year carried only 21,044,000 tons. The income of the railroads in 1880 was 580½ million dollars; that of the canals was only 4½ million dollars. The canals had only one-fourteenth part of the traffic of the railroads, and scarcely more than 1⁄130 of the gross income.
These results are very remarkable when the records of the charges made under each of the two systems are examined. When the controversy between them was raging most fiercely, the railroads were charging about three cents per ton per mile, while the canals only charged ·799 of a cent.[114] It was not, therefore, on the ground of greater cheapness that the railroads claimed or received the traffic. It was the same with through as with local traffic. During the six years ending 1884, the receipts of grain and flour at New York by lake, canal, and Hudson River fell from 64 to 45 million bushels. In the same interval the quantity carried by rail only declined from 85¼ to 83 million bushels.[115] Between 1868 and 1884 the total traffic carried on the New York State canals fell from about 6½ million to little more than 5½ million tons. On the competing railroads—the New York Central, the New York, Lake Erie, and Western, and the Pennsylvania Railroad division—it increased from 10,476,000 tons to 36,700,000 tons. On the canals the traffic had decreased by over 15 per cent.; on the railways it had increased by over 350 per cent. The comparison is, of course, not strictly relevant and parallel, inasmuch as in the case of the railways traffic was gathered and carried over a very much wider area, and it was really only over a comparatively limited section of their several routes that competition existed. But the figures all the same serve to show “how the cat was jumping.”
The decline of canal traffic is almost the despair of economists in view of the remarkably low range of rates charged on the canals over this period. No better example of this movement could be given than that of the rates charged for the transportation of wheat from Chicago to New York. This is a through traffic, carried over 1000 miles, without breaking bulk by either system, and therefore under conditions exceedingly favourable to economical transport. In 1857, when the State of New York, by the mouths of its chief executive officers, was proposing to prohibit the railways from carrying heavy freight, and suggesting the imposition of tolls on railway traffic by way of assisting to keep the canals alive, the average rate charged for transporting a bushel of wheat over this long route was a fraction over 26 cents. In 1868 the canal system was charging 24½ cents, as against 42½ charged by the railway for the same service. Ten years later still, the lake and canal rate had fallen to 9·15 cents, and the railroad rate to 17·9 cents. In 1884 the former amounted to 6·60 and the latter to 13 cents.[116] Throughout the whole period the railway-borne wheat has paid almost twice as much as the water-borne. And yet the trade of the canals declines, while that of the railroads increases. This is an enigma for which we must now endeavour to find a solution.
The United States differ from Great Britain, and from most other countries, in their economic circumstances. They have developed their trade with a rapidity that is perhaps unexampled in the annals of commerce. They have found such a demand for their produce, alike at home and abroad, that they have not had time to take heed of cheeseparing economies. The question with the agriculturists and the manufacturers alike has been to secure the largest possible deliveries in the shortest possible space of time. They found a practically unlimited market for their agricultural produce in Europe, at prices which, while they were working on a virgin soil, paid them sufficiently well. Of that price, transport was no doubt an important element. When the railways were receiving 30 to 40 cents per bushel for transporting wheat from Chicago to New York, the sellers were receiving 40s. to 50s. per quarter in London. The railway transport was therefore only one-fourth to one-fifth of the entire ultimate cost of the product. If the ocean transport cost 15s. more, the total cost of transport only absorbed about one-half of the price paid by the consumer, so that 25s. was left to the grower, minus other charges, and at much less than this price wheat could be profitably grown in the West. The difference between 24½ cents by canal and lake and 42½ by railway was not then of paramount importance. On the other hand the exporter had the supreme advantage of quicker deliveries, the absence of equal risk of having the material spoiled by damp, the certainty of being able to meet his engagements “on the nail,” and entire independence of the weather, which freezes up the canal and river navigation during one-half of the year. For the same reasons that the grower and exporter of wheat was willing to pay 9d. more per bushel to the railway in 1868, he has been willing to pay gradually diminishing differences since, until he has now to pay the railway no more than 3½d. per bushel in excess of the canal rate for more than a thousand miles of transportation.
All this, however, can hardly be said to prove anything against canals, although it undoubtedly proves that in the special circumstances of the wheat trade, and of the Erie Canal, the American freighter of cereals gives a preference to railroad transportation. In the case of heavier traffic, the position would probably be reversed, and especially if the navigation were open all the year round, as would be likely in a temperate climate like that of England, instead of being liable, as in the case of the Erie Canal, to be frozen up for one-half of the year.
Of the fifty canals that are now constructed in the United States, thirteen were completed, or at any rate begun, between 1825 and 1830. Some of the earlier canals were very expensive. The Erie Canal cost 90,000 dollars per mile, with a capacity for boats of over 250 tons. The more recently constructed Illinois and Michigan Canal which admits of the passage of boats of 2500 tons, from Chicago to the Mississippi river, was only 55,355 dollars per mile. The locks on this canal are now 350 feet long, and 75 feet wide, admitting twelve canal boats at a time.
From the Report of the Tenth Census of the United States, we have compiled the following details of the principal existing canals in that country:—
| Canal. | Miles. | No. of Locks. | Length of Locks. | Rise and Fall. | Cost of Construction. | Average Cost per Mile. |
|---|---|---|---|---|---|---|
| feet | feet | dols. | dols. | |||
| Erie | 365 | 72 | 110 | 656 | 51,609,000 | 141,394 |
| Champlain | 81 | 33 | 110 | 179 | 2,378,000 | 29,358 |
| Delaware and Hudson | 83 | 107 | 100 | 1,028 | 6,339,000 | 76,373 |
| Raritan (ship) | 44 | 140 | 220 | 150 | 4,735,000 | 107,613 |
| Morris | 103 | [117]46 | 88 | 1,674 | 6,000,000 | 58,252 |
| Schuylkill | 58 | 71 | 110 | 619 | 12,580,000 | 216,893 |
| Union | 84½ | 93 | 90 | 501 | 5,907,000 | 148,946 |
| Susquehanna | 30 | 43 | 170 | 230 | 4,930,000 | 164,333 |
| Chesapeake and Delaware (ship) | 14 | 3 | 220 | 32 | 3,730,000 | 266,430 |
| Chesapeake and Ohio | 179½ | 75 | 100 | 609 | 11,290,000 | 62,869 |
| Illinois and Michigan (ship) | 102 | 15 | 110 | 141 | 6,557,000 | 64,284 |
| Ohio Canal and feeders | 323 | 150 | 90 | 1,207 | 4,695,000 | 14,536 |
| Miami and Erie | 284 | 93 | 87—89 | 907 | 7,144,000 | 25,155 |
The canal system of the United States now in actual operation extends over 2926 miles, of which 411 miles are slack water. The cost of constructing the whole system is officially stated at 170,028,636 dollars (34,005,727l.). Disregarding the slack water, this corresponds to an average of rather more than 13,500l. per mile, or approximately 2000l. per mile more than the average cost of the railways of the same country. The total gross income in 1880, the latest year for which there are complete returns, was 4,538,620 dollars, and the total expenditure was 2,954,156 dollars, or 65 per cent. of the gross income. This figure compares very unfavourably with that shown for the American railroad system in the same year, the working expenses having been only 39·2 per cent. of the gross earnings. The net income of the United States canals in 1880 was 1,584,000 dollars, which is less than 1 per cent. on the total expenditure. The commercial aspect of the canal system of the United States is not, therefore, an encouraging one. Hadley, indeed, declares that after 1870 “it became a question whether the canal could pay expenses of maintenance—a question which was finally decided in the negative.”[118]