The Railway Library, 1909 / A Collection of Noteworthy Chapters, Addresses, and Papers Relating to Railways, Mostly Published During the Year

by Unknown

(1) State management would be less efficient than management under private enterprise.

(2) The extension of Government patronage, by placing at the disposal of Government such a vast number of appointments to lucrative offices.

(3) The risk of political corruption, not only in connection with the exercise of patronage, but also in ordinary administration in the settlement of questions relating to charges, wages, and services.

(4) The danger that interested parties would, by political pressure, compel the State to expend public money on unremunerative lines and unremunerative services.

(5) The contraction of the available field for private enterprise, and hence the weakening of the foundation of all individual and national progress.

(6) The introduction of serious dangers in connection with labor disputes between the Government and the large body of railway servants.

The subject has not been sufficiently long under public discussion to make it easy to state fully the hopes of its supporters and the fears of its opponents. Probably both are exaggerated. If one examines the complaints made against the existing railway system, it is obvious that many of these must exist under any system, whilst some are the necessary accompaniments of every system into which competition enters. But if competition is discarded in favor of monopoly it does not need argument to show that this merely means a change from the evils of competition to the evils of monopoly. No one would deny that each system contains inherent and characteristic evils. The evil of competition is waste; the evils of monopoly are stagnation and the restriction of freedom.

Hitherto, for the regulation of railways, reliance has been placed on two factors—competition and control. Parliamentary action and public opinion have veered about from one to the other, and the absence of clear principle in the policy of the Legislature has introduced evils which a more logical and consistent adherence either to the policy of free competition on the one hand, or to the policy of strict control on the other, would have avoided. That some regulation is necessary all would admit. Railways sell transportation as a commodity, but the nature of the business makes it impossible to secure the conditions of absolutely free competition as in the case of other industries. Hence the necessity for control, but every plan of control that has been tried has proved practically inoperative and ineffective mainly because it has endeavored to leave competition in operation, and it is the evils which necessarily arise from competition which lead to most of the complaints against railways. The inevitable weakness of the dual system of competition and control is that control checks competition just where it would be useful in the public interest, and competition nullifies control just where it could be advantageously applied.

Under no system could we expect railways to be free from complaints. They arise equally from the nature of the business and the nature of the customers. But with a view to seeing whether State ownership would remedy the complaints that exist, let us try to understand as clearly as possible what the complaints are. The Chancellor of the Exchequer (Mr. Lloyd-George), speaking to a deputation of traders in 1906, when he was President of the Board of Trade, said that he was impressed with the "great and growing discontent with the whole system."

Now what are the causes of the present discontent? Is it great? Is it growing? These are questions very difficult to answer. But there are some useful data available for the answer. The way has been made plain and easy for complainants against railways. Every encouragement and every facility has been afforded to them. A special Court has been created—the Railway and Canal Commission—the constitution of which was carefully framed so as to encourage anyone with a grievance against railways to hope that he would get a sympathetic hearing of his case. The applications to that Court were so few that those people who cannot bring themselves to believe that the number of real, as distinct from imaginary, grievances against railways are remarkably few, said that the public were deterred from bringing complaints forward by the expense of litigation before the Railway Commissioners. So, to render the path of the complainant still easier, a procedure was introduced which is unique for simplicity and cheapness. All, without distinction, who had any complaint or grievance of any sort or kind against any railway or canal company, were invited to come and lay the same before a Department of Government, the Board of Trade, who practically promised to use their influence to secure an amicable adjustment of any differences. This procedure is so simple, so sweeping, so all-embracing, so encouraging to complainants, and has, on the whole, been exercised by the Board of Trade with so much tact and success, that its records should supply the information we are seeking.