VOL. 38

No. 213

W

HEN corporate corruption is in evidence throughout the length and breadth of the land, and its evil influence on the body politic is the crowning scandal of the day; when every turn of the cards in the investigation of corporate methods uncovers fresh exhibitions of dishonesty, graft and moral turpitude which have become embedded in the political and commercial life of the United States; when railway after railway that happens to come under the searchlight of investigation discloses the same story of corruption and moral obloquy, it is refreshing to know that somewhere in the world there is a railway system free from corruption, free from political jobbery, free from blackmail, free from the system of rebating to the favored few, free from stock manipulations, free from consolidation, free from land-grants and government appropriation scandals, free from bribery, free from criminals booted and spurred who would crush the many to enrich the few, free from judicial corruption and jurypacking, free from all the species of

crime, dishonesty and peculation that have been trailed home to the railway managements of the United States. In the government-owned and operated railways of New Zealand there is found an object-lesson for the nations of the world, and especially for our corporation-ridden Republic, which should lead thinking men out of the fool's paradise into which the corporation press has led them, and cause them to see how pitiful and false are the hired sophistries of the tools of the Wall-street railway interests of the United States. New Zealand presents a real, living, shining example of a system in the operation of which every citizen has his just due and no man profiteth on his fellow-man's oppression. It is a system above and beyond the corrupting influence of the stock market, the personal gain of a stockholder, the favoritism of rebates, the bribery of the judiciary, the crushing of the many. It is a recognition of a wise principle in the economy of governments that highways of whatever character, by virtue of their public necessity and use, belong to, and should

be under the direction and control of a responsible government representing all the interests of a community, state or nation. Railways are highways, they are a public utility; without them a rural population removed from the seaboard could not exist in these modern days. They are as essential to national life as the government itself. They are a public utility altogether too powerful for good or evil, to ever be within the control of any authority not created by and answerable to "the people." The spectacle of not more than one half-dozen railway magnates in the United States controlling 298,000 miles of railway track, reaching out through the cities and over private property like the feelers of a devil-fish directing the disposition of earnings amounting to $1,975,174,091 per annum, controlling an industry employing over one million and a quarter of men, suggests at once a centralized power of such magnitude as to be a menace, if unwisely governed or given unbridled license, that could disorganize the political institutions of the nation, from which it has pillaged through bribery and corruption practically all the rights-of-way upon which its tracks are laid and its buildings, shops, and terminals are constructed. By plausible arguments and ingenious sophistries, not untainted by corrupt acts, the Congress of the United States was induced to give away a vast public heritage of millions upon millions of acres, and out of the public treasury, unknown millions of dollars to enrich the few promoters, whose sole aim and purpose in life is to "get rich quick" at the expense of the plodding people. By the pooling of earnings, the combination of lines and union of interests, all healthy competition has been removed; discrimination between individuals and places have operated to the prejudice of a longsuffering and helpless public, and in favor of the few whose private weal has been given precedence over the public good. The shadow of a remedy has been prescribed by a servile Congress in

the form of a Railway Commission which has furnished some measure of relief, but with the political power vested in the railway service that can, and will be, and has been, used in the election of a friendly executive with appointive power, the work of such a created commission is rendered negatory and unimportant. The railways of any country under private ownership are a dominating, dictatorial, corrupting, and tyrannizing power; they brook no interference with their plans or policy; by discrimination and preferentiation they dictate the direction in which traffic should flow and to their own selfish purposes determine its destination. By the employment of preferential rates they bestow favors on individuals to the detriment of communities. Is it therefore to be marveled at that discontent and dissatisfaction with with their methods manifest themselves in an intense degree? The attempt to legislate commercial integrity into railway methods by the Inter-State Commerce Act of 1887 has signally failed of its purpose, and complaints against discrimination, preferentiation, drawbacks and rebates, are as pronounced as ever; therefore the question of state-ownership is commanding the intelligent interest of independent thinkers who believe there is a remedy somewhere for every evil. State government ownership of railways has passed the experimental stage in Europe and Australasia so fully that they can be discussed in the light of their efficiency, usefulness, and healthy influence.

or

Dealing particularly with the railways of New Zealand it will be interesting to know that the policy adopted by the government is to regard them more as a factor in the development and settlement of the country than as a mere revenueearning machine, extracting from the people an illegitimate earning on an artificial capital. Its policy has been and is now to return to the people by means of concessions or reduced fares and freights an amount calculated to equal the excess of the net earnings (main

tenance of way, of rolling stock, terminals and all operating expenses considered), over three per cent., this amount being the return the railways are expected to yield on the actual capital cost of construction.

In fixing whatever concessions are granted from time to time the necessities of the growing industries of the colony are always placed on a more favorable basis than rates for a foreign product of a similar character. In other words the struggling industries of the colony are fostered and favored that they may grow into great commercial factors rather than that the invading foreigner should control the markets of the colony.

Whenever and whatever concession of rates are made from time to time full particulars are gazetted for the information of every shipper, whether large or small, and every forwarder of goods of a particular class must pay the same rate and conform to the same conditions specified in the public regulations, in the employment of which method no individual can under any circumstances obtain preferential treatment, rebates, or drawbacks. Each pays the same rate for the same service, and all colonial forwarders are given the benefit of the lowest possible rate in all cases where alternative rates exist. To illustrate which the Hon. Sir Joseph G. Ward, late Minister of Railways and now Prime Minister points out that:

"Owing to the length of its seaboard and the fact that the larger towns are seaports there exists what are known as 'local' and 'classified' rates. The former apply to certain localities and are made to meet special conditions, and the latter apply to all other traffic carried over those portions of the line where ordinary conditions prevail, but if it is possible to make by combination of the local rates in operation to a given point and the classified rate from that point to the destination station a lower charge than by computing the freight on

the classified rate for the full mileage the goods are conveyed, the combination is used. If, on the other hand, the through classified rates are the most favorable to the forwarder, they are used as the basis of the charge. In all cases and under all circumstances the interests of the forwarder is made the first consideration by the government."

The opportunity was afforded me during a recent visit to the United Kingdom to note by comparison the operation of private-owned and government operated railways under the British flag. Britain with a contributing population of 45,000,000, limited to an area but little greater than that of New Zealand, under the avaricious hand of privateownership, over-capitalization and combined pools of earnings, pays in passenger fares a very much larger tariff than is paid on the New Zealand government railways, notwithstanding the great disparity in contributing population.

A comparison of the English roadbed and speed of trains is vastly favorable to the English railway system; not to be wondered at however, when we know that the first use of rails for the purpose of reducing the traction of vehicles dates back to the year 1633, and the first use of iron rails dates back to 1801. Considerably more than a century, therefore, has been devoted to the perfection of the roadbeds of Britain and the perfecting of its rolling stock. In comparison with the latter, however, the New Zealand railways are more comfortable and decidedly more cleanly. In England as elsewhere private-ownership of railways has ever used the now exploded argument of competition to prove the efficacy of its case, the fallacy of which can best be shown by presenting comparative rates charged for ordinary travel on the New Zealand government railways with rates for like distances on English lines between points enjoying the benefits of "keen competition" and heavy passenger traffic.