Freight Profits.—The change in rates are of great moment to the producer; that of profits is the important one to the carrier. No matter how great the reduction of rates, if the reduction of expense is as great, the profits are not disturbed. This question can be studied best by examining the figures which measure the actual profits. But few corporations furnish such figures, and the two whose history is delineated on the accompanying chart are among those giving the most readily available data. It will be seen that the reduction of profits is no less remarkable than the reduction of rates, which shows that the reduction of rates has far exceeded that of expense of carriage; for, had the reduction of expenses kept pace with that of rates, the profits would have remained level. As it is, the reduction of profits in the history of these roads, as shown, is from about six mills per ton per mile in 1870, to about two mills in 1888. These two roads are probably good representatives of the experience of the general freight service of all railways north of the Ohio River. If so, the prospect of the future of freight traffic is not cheerful.
PASSENGER TRAFFIC.
The study of passenger traffic is less satisfactory than that of freight traffic. Fewer lines furnish a history of their passenger rates, and ordinarily those histories cover shorter periods. The study is therefore confined to narrower limits and its lessons are necessarily less conclusive.
Passenger Rates per Mile.
Passenger Rates.—Below is given a chart interpreting the available data of six representative lines. The first lesson impressed is that no such reduction marks the history of passenger rates as is shown in freight rates, although the general trend of the chart-lines is plainly downward. The line indicating the average rate for all the roads in the country (marked U. S. in the chart) shows a reduction of over one-fourth of a cent per passenger per mile since 1882.
Certain features of this chart attract special attention. The reduction of rates by the Pennsylvania, and the New York Central & Hudson River roads in 1876, and that by the same roads in 1885, are suggestive. Equally noticeable are the reductions of the Illinois Central in 1871, 1872, 1880, and 1888.
This chart would seem to indicate that competition has not operated as sharply on passenger as on freight traffic.
Passenger Travel.—The average distance that passengers ride is not as important an element of railway business as is the average freight haul, for the passengers load and unload themselves; so that, whether they ride few or many miles, the cost of loading and unloading is neither increased nor diminished. On the contrary, if a thousand tons of freight, once loaded, is to be hauled one hundred miles instead of fifty, the proportional cost of loading and unloading is reduced one-half.
