H M Hyndman February. 1916

The National Railways after the War

Source: Nineteenth Century and After, February. 1916, pp. 461-477:
Transcribed: by Ted Crawford.

‘Experience is the best teacher but the school fees are very heavy.’ They certainly are, and we have learnt this truth at any rate since the beginning of the War. We found all of a sudden in August 1914 that our whole political and social system was not competent to face, with any hope of success, the terrible crisis into which we drifted unprepared. From that time to this we have been engaged in a hand-to-mouth endeavour to adapt our belated methods to the necessities of the time, under the leadership of men whose character and training unfitted them for the task they were compelled to undertake. Free Traders forced into protection, individualists driven to turn collectivists, peace-at-any-price theorists preaching a fight to a finish, champions of the freedom of nationalities sweeping away all our ancestral liberties, parliamentarians and lawyers turning the House of Commons into a ‘Bed of Justice’ and regimenting the entire nation under Orders in Council which could not even be criticised.

Nothing at all like this has been seen in this island since the days of Thomas Cromwell. And, if things go on as they are going, his views on the expropriation of the Church will ere long have to be applied to the expropriation of – but it is perhaps better not to enter upon so prickly a subject at this point. Enough to say that, since the War began, the rights of the State (no matter who may be masters of that nebulous entity) to control and take over company property and private property have been asserted with a vigour and a celerity that not the most vehement advocate of centralised bureaucracy could have foreseen. As one might expect, we have been none too successful in this rapid change. But now our shortcomings as a nation are being slowly recognised, even by ourselves; and we show a certain readiness to look facts in the face which may lead us to put our affairs in order.

There is much talk just now of the peace after war: there is also not a little discussion of the war after peace – a trade war, in which we shall certainly be utterly routed unless we learn from the enemy. The great difficulty is that in order to reorganise our home business we have to deal with so many things at once: some of them such that they cannot by any possibility’ be put right in a hurry. We are behindhand in so many directions, and our political forms are so terribly belated in comparison with our economic development, that we have no adequate machinery at hand to deal with the great complications ahead of us. For more than two generations our governing classes have deliberately thrown away the best possible opportunities for thoroughgoing reform. Now, at the greatest crisis in all our long and eventful history, we are still cumbered with old-fashioned and worn-out methods of national government.

One portion of our national economy, however, which must in any case have been reorganised before serious economic progress could be made in other directions, has, of sheer necessity, taken a long step in advance. Transport is the most important factor in the extension and improvement of agriculture, and the consequent increase in the provision of home-grown food for the nation. Other serious points must be taken up and dealt with as speedily as possible, but this is vital at the start. Other things being equal, food is a function of transport. That is admitted in most unexpected quarters. Transport has also a direct bearing upon our capacity to meet competition from without – assuming our present competitive system to continue – in all our industrial departments. This, too, is now universally admitted. As matters stand, nevertheless, our railways, which so far dominate our whole internal distribution, are the greatest system of protection in favour of the foreigner that the world has ever seen. Tariff reformers cry out for protection against imports from abroad – which may be necessary while we are reorganising our agriculture and our industries – but they stoutly maintain protection in favour of such imports by our railway companies at home. Even now nothing whatever is being done to overthrow this pernicious incubus on our people. But there is hope at last.

When the War began, Nationalisation or Socialisation of our Railways, which some of us had championed for more than a generation, seemed to be almost as far off as ever. No sooner was War declared, however, than all the railways were placed under Government control at a stroke. The Order in Council of the 5th of August 1914, which was not an Act of Parliament itself but based upon the Act of 1871, decreed this vast administrative transformation. The Order stated that it was adopted ‘for the purpose of ensuring that the railways, locomotives, rolling-stock, and staff should be used as one complete unit in the best interests of the State for the movement of troops, stores, and food supplies.’ That is clear enough. And the matter of food supplies obviously concerns not only the troops but our entire home population.

But so far this essential unification of control has entirely failed to introduce any great simplification or economy into the general management. The problem of national transport has not yet been regarded, still less handled, by the Government from the national point of view. Here, as elsewhere, hand-to-mouth methods and rule-of-thumb ideas are good enough for us. We have been obliged by the exigencies of war to adopt nominally a more logical and sounder basis of railway management in order to avert chaos; but we have not yet devised any plan which carries out the details of administration to the public advantage. Far from it. All the old anomalies and drawbacks remain as they were: all the lessons to be learnt from foreign experience and home criticism are still disregarded. This may be explained, though not excused, by the contention that great reforms are impossible during war. Our enemies, the Germanic Powers, do not reason in that way: they are adopting improvements in production and distribution all the time. However that may be, the strain of war does not relieve us from the necessity for making ready to introduce crucial modifications at the peace; especially since it is inconceivable that the railways will be returned to uncontrolled company domination. And there is no reason whatever why steps should not at once be taken towards that economy of effort and reduction of expenditure about which Cabinet Ministers are so eloquent in some directions while so neglectfully extravagant in others.

The drawbacks to our railways under company management, from the point of view of the producing, manufacturing, and trading community, have often been insisted upon. The whole country is completely overmastered by the privately owned railways. That railways ought to be as much devoted to public service as the highways and postal wagons and motors now are is a national conception which has never yet found general acceptance. But the old idea that competition would keep down rates of freight and passenger fares has long since proved illusory. Railway companies nowadays all ‘pool their issues,’ and their tariffs and rates for the same destinations are the same. Even canals, which might have competed to general advantage, have been allowed, by the supineness of the Government and the lack of organisation of the people, to fall under the control of the companies, which carefully rendered them useless as effective competitors for freight. The political influence of our companies, also, is so great in the House of Commons, owing to the presence in that Assembly of upwards of a, hundred railway directors, belonging to all parties, who vote solid on all railway questions as well as to the very large numbers of shareholders and debenture-holders in these corporations who sit in both Houses, that it is almost impossible to carry any important measure of which they disapprove. Prior to the War, indeed, matters were getting worse instead of better.

So long ago as 1892, in my evidence before the Royal Labour Commission, I did my utmost to expose the harmful effects of our railway management from the national point of view, as applied to every branch of national industry. One fact alone ought to have roused the public to the necessity for prompt action in the interest of the development of our home resources. Water transport is so much cheaper than land transport that the contrast; is surprising. I showed at that date how, on the average of years India, America, Australia, New Zealand, Argentina, Canada, as reckoned by freight on the merchandise chiefly shipped from those countries, were within the thirty-five-mile radius of London. Pretty much the same is true in ordinary times now. Mr. W.B. Lawson, whose book constitutes an elaborate argument in favour of the shareholders, is good enough to quote a reference of my own to this evidence in my Further Reminiscences.

A little more attention was given to the question of differential rates in favour of foreign imports, because it was the question of the moment. It did seem preposterous, even to Royal Commissioners, that home meat from Cheshire should cost twice as much to send to Sheffield as foreign meat from Birkenhead in the same country; that it should cost just one-third the freight to ship ores and manufactured iron between Essen and port as it did between Sheffield, the English Essen, and port; and that fruit and other agricultural produce should be rotting in English orchards and fields, while inferior foreign eatables of the same description were passing up every night and every day to Covent Garden at a fraction of the rates charged to our own countrymen.

That passage Mr. Lawson stigmatises in 1913 as ‘sweeping abuse.’ Yet it is nothing more than a plain statement of admitted facts – facts which spell ruin to any extension of most important branches of English agriculture, and very seriously hamper English industry in the competitive markets of the world. Nor are any great improvements, as already said, being made, or even considered, now.

Obviously, company directors and their shareholders regard all freight questions from the point of view of the dividends paid by the enterprises which they own and control. The national interests form quite a subordinate consideration. Thus, it might be greatly to the national advantage to incur a loss on the working of a particular railway by charging low rates of freight upon agricultural produce forwarded from remote districts. Such a policy carefully carried out might be, as it has proved on the Continent, of great benefit to the nation. In fact, no national loss whatever has been sustained. Quite the contrary. Owing to the profitable spread of cultivation and the consequent direct and indirect returns to the Government, the people at large have been the gainers by a course which no private company could systematically adopt. The particular railway accounts show an adverse balance: the wealth of the district served is increased. Cheap transport solves the bed-rock problems of agricultural production and manufacturing industry. In Great Britain no loss need be involved by such cheapness.

The crucial test for the community of what is being done in the matter of freight is the actual cost of carrying a ton of goods a mile. There are many and great differences, of course, between the class of goods transported, from heavy mineral traffic such as coal and ores, to light and consequently bulky merchandise such as household furniture. Nevertheless, it is quite possible to strike a working average. Taking, this ton-mile cost as a basis, I proved conclusively nearly a quarter of a century ago that the American railways east of Pittsburg did their work, with equal break of bulk, at a fraction of the expense in Great Britain, though wages in the United States were, even then, about twice what they were here. The comparative statistics were worked out in co-operation with the ablest railway statist on either side of the Atlantic. Since then, all the British railways with one exception have ceased to publish any estimate of the transport cost per ton-mile in their statistical reports. This, although the average cost of transporting a ton of goods a mile is published regularly by the railway companies in many other countries. The reason given by the directors for this startling omission is that it is impossible to arrive at the real figures on their railways. So far, the British Government has acquiesced in the suppression of these important data for criticism, and to that extent has deliberately allowed reform to be checked.

The main cause for the extraordinary difference in the American and British cost, at the date referred to, was not the much greater length of haul, as is commonly alleged, for that contention is nullified by the conditions prevailing east of Pittsburg and the equal break of bulk, but the superiority of the American trucks. Their wagons, that is to say, of the same weight as ordinary English wagons, carry from twice to more than four or even five times as much paying freight. This applies to the heavy freight chiefly; but, clearly, the saving is relatively even greater when lighter goods are carried. Above all, having regard to the vast and unnecessary number of privately owned ‘empties’ hauled back on the English lines, it is manifest that a serious reduction in the weight of the wagons must bring with it a great economy in this direction as well. When it is argued that English railways and their system of transport do not admit of the employment of the large American box-cars, the answer is that light tough steel is just as available for small wagons as for large, and that the saving as compared with English out-of-date wagons, especially those privately owned,^[1] would pay back the total cost of replacement within two years.

Moreover, life and limb appear to count for no more than scientific material organisation. The directors of English railways always refuse to adopt automatic couplings, though thousands of men have been and are being killed and wounded for want of them. Yet in the United States, where we are apt to say that life is held cheap, they are universally employed. Our whole railway system, under company management, is in fact, rotten from top to bottom; and even under the control of the Government matters are as bad as ever. But, were nationalisation of railways definitely adopted, this state of things could not continue; only a proper reorganisation must be established from the start.

The main points which have to be dealt with and solved in any thorough national reorganisation are:

(1) Improvement and simplification of the organisation of the whole complicated system engendered by the separate establishments of the various companies, which involve multiplication of staff in many directions, running of unnecessary trains, elaborate clearing-house arrangements between the various companies, etc.

(2) Reduction of fares and superior convenience for passengers.

(3) Reduction of rates of freight all round.

(4) Abrogation of all preferential rates for foreign, produce of every description.

(5) The benefit of all improvements to go to the public who use the railways instead of to private shareholders.

(6) Security for the life and limb of the employees.

By far the best plan as a whole I have yet seen for bringing home to the entire people of this island the necessity for complete transformation has been formulated by Mr. Whately C. Arnold, a London solicitor: another instance, added to many previous cases, of crucially important suggestions coming from a quarter not directly connected with the particular department to which their ideas apply.

As is suggested by Mr. Whately Arnold, there is nothing in the nature of the case to prevent State railways under direct State control from being at least as well managed as the Post Office. State railways in many other countries have been much better managed in regard to freight, and no worse managed in regard to passengers, than railways in those countries where they are under private control. Should the Government decide to take over the railways definitely after the War, Mr. Arnold urges that they should be handled as a vast extension of the Post Office. The Post Office is itself compelled already to use the railways to a very large extent, under private ownership, for the transport of mails and parcels. If now every Post Office throughout the country were converted into a railway receiving centre as well as an office for the sale of tickets or railway stamps and the distribution of goods, the convenience and saving due to such a concentration of effort would be very great.

The following, then, are some of the very substantial economies which will be effected^[2]:

I. EXPENDITURE WHICH WILL BE ENTIRELY ABOLISHED.

(a) The Railway Clearing House, the sole object of which is to apportion receipts and payments between the various companies, about 217 in number, and requiring for its work a large and expensive staff not only of clerks, but also of inspectors at every junction, and a large establishment at Seymour Street, Euston.

(b) The separate boards of directors, officers, and clerical staff of all the separate companies.

(c) The legal and parliamentary expenses incurred in disputes between the various companies and in opposing rival companies’ new lines.

(d) Advertisements by rival companies of their own routes.

II. EXPENDITURE AND WASTE WHICH COULD BE DIMINISHED.
1. By Reason of Unification of Systems.

(a) Competing receiving offices and their staffs would be reduced to one in each locality.

(b) Rolling stock, which is now often idle because owned by different companies, could be used solely according to the requirements of the traffic.

(c) Competing trains now naming on different lines at the same time between London and other large towns could be run at different times with largely increased numbers of passengers at same cost.

(d) Adjoining stations belonging to competing companies would be amalgamated.

2. By Reason of the Adoption of Uniform Rates and Fares.

(a) The abolition of the elaborate book-keeping and staffs needful for the present complicated system of passengers’ fares and goods’ rates, especially the latter, with the waste not only of expense, but also of time.

(b) The saving of the expense of printing and advertising various priced tickets and fare tables, also of the large staff of booking clerks, inspectors, and others.

(c) The saving of the legal expenses now incurred by the Railway and Canal Commission Court in appeals and disputes between the companies and traders as to rates, etc.

3. By Reason of the Amalgamation of Railways with the Post Office,

(a) The rent and expenses of numerous Post Offices in the neighbourhood of railway stations would be saved, all stations being used for postal purposes.

(b) All postal sorting and other offices could be situate on railway premises in or near the stations, and besides thus saving the rent, would be in closer touch with the railway.

(c) The whole of the railway tracks would be available without rent for laying of telegraph and telephone wires, either over or underground.

(d) Surplus land, of the railways, in particular where adjoining to stations, would be available for other Government purposes, such as: Inland Revenue Offices, Labour Exchanges, Military, Naval, or Civil Service purposes, Police Stations, Fire Stations, County Courts, Police Courts, Land Courts, as well as Courts for dealing with questions arising out of the railways themselves.

Unification enables each part of the country to have as good a service of trains as every other part, notwithstanding differences of population and resources. The companies now operating on the South Coast cannot provide so good a service as the Northern companies, owing to the lack of the great mining and industrial centres which are served by the latter.

The waste of rolling stock, especially of goods wagons, occasioned by the multiplicity of goods stations, the transfer of rolling stock to and from the lines of different railway companies, the shunting of trains, and the large number of road vans used by the various companies, is enormous. In London alone there are seventy-four goods stations, used for goods only, and 700 goods trains per day travel between these seventy-four stations, doing nothing but transferring goods from one of these stations to another! Goods consigned to one warehouse in London from places on, say, seven different railway companies’ lines, are sent by seven different vans, one belonging to each company.

Under the present system goods trains, having been unloaded, must be returned in order to clear the line, so that it is not uncommon to find goods trains belonging to the various companies returning empty for long distances on each line, on the G.W.R. as far as Bristol, on the S.W.R. to Basingstoke, on the G.C.R. to Banbury, and so on.

The waste under our present railway methods is indeed almost inconceivable. Thus it is calculated by Mr. A.W. Gattie, in figures that have never been challenged by the champions of the railway companies, that on the average every locomotive engine is occupied during sixty-two hours out of every seventy-six hours of its active life in shunting. This disposes of not less than 84 per cent. of its entire energies. It is impossible to contend that this is an economical use of its mechanical force. Obviously, any plan which would reduce the term of such bootless service to the extent of even one-half of the 81 per cent. would vastly increase the efficiency, and therefore reduce the relative cost of the employment of any particular locomotive. But until the problem is regarded from a much wider standpoint than that of the railway companies, or of the Board of Trade, which has persistently declined to move in these matters in the direction of the public advantage, no radical change will be made. Even thechaotic mismanagement of London traffic, which is universally admitted, will remain unremedied unless the whole subject is taken in hand by independent experts who have no prejudices in favour of the present system.

But still more remarkable than the waste of locomotive power is the hopeless congestion of the railway wagons. There are upwards of 1,400,000 railway goods wagons in Great Britain. Of these wagons only per cent. are in actual motion with a load at any given time That is to say no fewer than 97 per cent. of the wagons are constantly idle; while of the remaining 3 per cent. being actually hauled fully 21/2 per cent. consist of empty trucks. The diagram on the next page puts this fact in a very startling shape. Here is a state of affairs which calls for immediate attention, and elaborate proposals have been set forth which meet with acceptance, not only from railway experts and engineers of the highest standing, but by Chambers of Commerce and independent critics; proposals that would not only release the wagons thus uselessly held up, but would at the same time clear the increasing congestion in our great cities, reduce the cost of transport, minimise the delay, and help on that thoroughgoing transformation of our railways which is more necessary now than ever it was.^[3]

It is impossible to deal adequately within the scope of this article with Mr. Gattie’s elaborate proposals for a Central Clearing House for all goods brought by railway into the metropolis or to be distributed by railway therefrom, But it has been conclusively proved that, by the means suggested, including the use of automatic electric appliances, specially adapted, on a large scale, at least twice the amount of goods traffic now handled could be dealt with speedily and economically on an area of thirty acres. The total capital cost for building, tunnels, plant, and approaches is estimated by Mr. Edgar Harper at £14,000,000. This scheme, if adopted, would do away permanently with the terrible waste of locomotive power and wagons at present inevitable, as well as the block caused on the railway sidings and depots. The increasing congestion occasioned by heavy traffic in the London streets would also be immensely relieved, if not altogether removed. This is a definite solution of a problem of growing difficulty which has been worked out on a practical basis and is open to examination. The obstacles to be encountered and overcome from more than one quarter are very great. The necessity for prompt reform is, however, still greater.

The following facts and figures give a further example of the chaos now prevailing Thus the area occupied by London goods depots in crowded parts of the metropolis was upwards of four and a half square miles twenty years ago. Though no accurate survey has been published recently, it is believed that the extent of land so occupied to-day is not less than seven square miles, or nearly 4500 acres, of a value of fully £50,000,000. Practically all this territory would become available for improvements. There are at present no fewer than seventy-four separate goods stations in London. Between these stations 700 trains a day are run. The three hundred and forty goods trains which arrive in London every twenty-four hours are all run to a dead end, or rail terminus. This device encumbers the traffic more and more each year, renders imperative the extension of the platforms to accommodate the trains, and increases the number of men required to handle each ton of freight carried. Moreover, the transference of laden and empty wagons from one main line to another causes additional waste and still further intensifies the congestion. Any change which will remedy all this mischievous incompetence must certainly be made for the benefit of the nation and not for the profit of private persons or company owners.

Free transport of freight must be ruled out for the present. Though beyond all question this complete social reform would vastly enhance production in every direction, it is difficult to conceive of anything short of a Socialist community accepting so thoroughgoing a revolution. Unless our ideas are totally transformed in the course of the War, and we learn to think in terms of wealth instead of in terms of money, no statesman would face such an apparent loss on national finance as £74,000,000, the gross income from goods traffic, at a period when the whole nation will be groaning under a weight of taxation never before experienced. The difficulties would appear insuperable, however certain it may be we shall come to free transport at last.^[4]

Transport at or near actual cost, however, would, of itself be little short of a revolution; especially if, as already stipulated all improvements tending to diminish expense were applied to the direct advantage of the community and not to the illusory gain of the taxpayer. The object always kept in view under such conditions is the steady increase of home production, so that the foreigner shall never again enjoy the crushing advantage accruing to him by the extraordinary disparity in cost between transport by land and transport by sea.

But before entering upon calculations as to what may be effected under centralised postal administration it is well to discriminate between the purely human and the definitely economic side of railway reorganisation. People in general pay much more attention to passenger than to goods traffic. This is natural enough. Everybody apparently benefits by travelling in comfortable carriages at cheap fares. Few consider, or thoroughly comprehend, the ruinous effect of heavy rates of freight for goods of all kinds upon the economic and social welfare and progress of the nation at large. All have experienced their purse’s limitations in the matter of business and holiday fares or visits to friends and relatives living at a distance, and this applies with special force to the whole of the wage-earners of the country. Consequently a scheme of nationalisation, to be popular (which it must be in order to overcome the inevitable opposition from the organised vested interests of the companies), should offer advantages to the passengers in the shape of greater convenience and cheapness; although indeed, from the point of view of the increase of national wealth or the general benefit, it makes little difference whether human beings are transferred hither and thither comfortably or uncomfortably, cheap or dear. Nor does it even matter, if they are themselves non-producers, whether they reach their destination at all. This is not an idea likely to commend itself to the people at large. When Commodore Vanderbilt was reproached with treating his passengers as if they were hogs, he coarsely summed up the situation in his reply: ‘By God, sir, I wish they was hogs!’ and his son W.K. Vanderbilt expressed much the same conception of railway responsibility when, being adjured to respect the rights of the people, he gave vent to his famous utterance – ‘The people be damned!’ These opinions, however justifiable they may be economically, might occasion unpleasantness when reiterated on this side of the Atlantic. If therefore nationalisation of railways is to be realised forthwith in Great Britain – and delay is in the highest degree dangerous – then the interests of passengers, for psychologic reasons, must be considered. Only a small minority ever inquire how far their personal list of necessaries or luxuries is curtailed by cost of carriage, still less whether the general wealth of the nation is hampered by the same cause; while even manufacturers, agriculturists, and merchants are apt to disregard this most important matter, and to look on in apathy and supineness at a system directly opposed to their interests.

Taking passengers first. The returns from these, according to the latest official figures accessible before the War, amount to a total of £45,000,000 for passengers alone and £55,000,000, including £10,000,000 for mails and goods sent by passenger trains, out of a grand total of receipts for the railways from all sources of £129,000,000: the total expenditure being £81,000,000. The number of passengers carried is 1,620,000,000. Of these 10 per cent. travelled first and second class. Mr. Arnold for the purposes of his proposals takes it for granted that not fewer than 20 per cent. will travel distances exceeding thirty miles. The trains for this purpose are, therefore, divided into main line trains or express trains running on the trunk lines and stopping only at important towns; and local trains, which will be all trains other than the main line trains, and will stop at all stations. The principle on which the proposals are based is that, when a train is run 200 miles, if a passenger has once travelled over 100 miles, it makes no more difference how much further he is carried than if he were a letter or a parcel. If a letter can be advantageously sent all over Great Britain for a penny, and now all over the British Empire and the United States at the same rate, if also a parcel can be forwarded practically any distance in like manner for 4d., there is no reason why a passenger who delivers and discharges himself should not be dealt with on the same lines. Thereupon the following remarkable figures are put forward, retaining the old distinction of first and third class.

The 20 per cent. of main line passengers travelling long distances by express would be underestimated at 300,000,000, and of these 300,000,000 only 10 per cent. are taken as travelling first class. The third class fare to any trunk line station by long distance train is put at only 1s.: the first class fare at 5s. both for any distance the train travels.

But the next suggestion that the whole of the remaining passengers by local trains should be carried at 1d. third class, with a 6d. fare for first class, will be generally considered impossible, and will rouse the antagonism of all the world upon wheels. The receipts on this 1d. basis with 6d. for first class would be £5,500,000 for the entire 1,320,000,000 passengers, plus 5d. a head more for the 132,000,000 first class passengers, or £2,750,000; that is to say, £8,250,000 together for the local passenger trains.

Here the total gross receipts for passengers would be only £29,250,000, as against the present receipts of 45,000,000, a deficit of not less than £16,000,000 to start with, if the present system were continued and no great economies were made. No financier would be disposed to face this, however bright the future: might look. Mr. Arnold argues, however, that account must at once be taken of the enormous reductions in gross expenditure resulting from the consolidation of administration; and he holds that a comparatively moderate increase in main line passengers, amounting to less than 20 per cent. of the whole 1,620,000,000 at the rate of 1d. third class and 6d. for first class would sweep out the deficit entirely and leave a considerable surplus. It is a remarkable calculation which might be justified by events. But there is no urgent necessity for such ruthless change in this direction.

In his anxiety to be strictly logical and to comply with his own axiom, that the flat rate for local passengers must not be higher for third class than the lowest rate now charged, and that the fare should be 6d. under all circumstances for first class on the local trains, Mr. Arnold has, it seems to me, prejudiced the acceptance of his own scheme. The simplification is too complete and takes no account of differences as decisive in their way as that made between express main line trains and local trains. But, by a careful modification of the scheme affecting metropolitan and suburban passenger traffic, differentiated, as it easily might be, from the local traffic; by putting the rate at the lowest fare decided on after close investigation and co-ordination; by increasing the third class rate for main line trains from 1s. for any distance to 2s., or even 3s. – surely more than a sufficient concession to passengers by express trains – the deficit would at once be wiped out and, according to the calculations, a considerable surplus secured. It is well worth while to show what could be done in this direction, and any profit or economy realised from the improved management of the passenger traffic, after fares had been considerably cheapened, might with advantage be devoted to the infinitely more important problem of reduction of freight.

This is the crux of the entire question of railway nationalisation, and upon this public attention, as well as unbiassed expert opinion, should be concentrated in the first instance. It is easy to underrate the difficulties of a thorough and beneficial transformation. But nothing less than the welfare of the entire nation is at stake. Home tillage and home industry must no longer be hampered by heavy rates of freight or by advantages granted to foreigners to the direct detriment and discouragement of domestic production. Railways have been allowed the privileges accorded to their owners presumably for the benefit of the community. English directors hitherto have assumed that the community exists for the benefit of the railways and their shareholders. But these shareholders and their directors, in and out of the House of Commons, have to learn at once that there are no rights of property which can be upheld against the interests of the entire community.

The following are the latest statistics of goods traffic available before the War:

Now the system upon which the railways of Great Britain are managed to-day, in regard to general merchandise, is to exact ‘as much as the traffic will bear,’ and to sacrifice home interests systematically to the through consignments from abroad. Hence arise, not only anomalies such as those already referred to, but a persistent neglect of home-grown agricultural produce such as fruit, meat, & c., in favour of similar produce from abroad, and a disregard of the real interests of manufacturers touching cheap transport for raw materials and finished products.

As with passenger traffic, the suggestion is that the goods traffic should be divided into main line trains and local trains Each of these would comprise fast trains and slow trains. The fast main line goods trains would run as a rule between fifty and 100 miles without stopping between important towns, and from one end of the country to the other. The slow main line goods trains will follow the same routes as the fast trains, but will stop at all stations not served by the local trains and at the junction stations. Local trains will be limited to distances of 50 to 60 miles.

The following estimates are based on present traffics and average rates. They do not exclude the possibility of specially low rates for large consignments of special goods within the country, but they do proceed upon the assumption that no exceptional advantages will be given to foreign fruit or other perishable articles as against home-grown commodities of similar character. In like manner smaller quantities than a ton, involving more labour to handle would be dealt with at higher rates to cover the actual cost. It may be taken for granted, however, that with the present development and growing advantages of motor distribution and collection within twenty to thirty miles of large centres, thus avoiding two handlings or breaks of bulk, railway transport will be increasingly displaced within this radius as time goes on and the cost of motor traction is reduced.

The figures given below are necessarily tentative, as full statistics are not available:

The effect of these changes will be not only a very great simplification of all freight transport with consequent economy, but also an enormous increase of traffic, as the advantages of cheap and certain transport are realised, leading to extension of cultivation in districts now hampered by excessive rates, and expansion of industry in others similarly affected. But until the entire subject of transport by rail and road is dealt with as a whole, and in the interest of the nation, no complete system of rates can be formulated which will cover all cases.

The objections to nationalisation have been so often stated and, dealt with that it is scarcely worth while to enter upon them here. We must admit that there is a danger in spreading still further that practically irresponsible bureaucracy, based upon the regimentation of the wage-earners under State domination, which at present holds the nation in its grip. But the ‘State Slavery’ which some view with alarm is not in my opinion a serious. danger. Already, in spite of the apparent apathy, all the machinery for a democratic revolt is being prepared by the wage-earners themselves. Meanwhile, the necessity for greatly improved efficiency in every department, and particularly in transport, is being appreciated by the workers as by other sections of the community.

A more serious difficulty is the financial operation needed for the acquisition of the railways. Even if confiscation of private property were accepted as desirable by the great majority of the people, it would manifestly be as unfair to apply this revolutionary process to railways alone as to land or factories by themselves. When the democracy resolves consciously to appropriate and communalise all the means of creating and distributing wealth it will scarcely begin piecemeal with the railway debenture-holders, and shareholders, however injurious their action may have been hitherto.

The total paid-up capital of the railways amounts in round figures to £1,300,000,000, and the net revenue of £48,000,000 (£129,000,000 gross receipts less £81,000,000 working expenses) shows an average of 33/4 per cent. on this total. The effect of the War will be that the capital value of the entire railway securities, as represented in prices on the Stock Exchange, will be very greatly reduced. If the nation is compelled to borrow at a rate even now represented by 5 per cent. (in the United States conjointly with France at 6 per cent.), it is clear that any demand by shareholders for a purchase consideration in Government bonds exceeding £1,300,000,000, which includes 15 per cent. of watered stock, will be scouted by the country. They may think themselves lucky if they secure to themselves so large a mortgage on the future prosperity of Great Britain. Such an arrangement, the Government being now in control of the railways, would not be difficult provided that, in deference to the current notions of national finance, it were made perfectly clear that this transaction would form part of one great co-ordinated effort to bring Great Britain up to the level of efficiency attained to by her most formidable competitors.

It is not contended that these thoroughgoing reforms of transport would of themselves reorganise English agriculture and industry. But they will remove at once a great obstacle to advantageous expansion, and would from the first obviate that waste of food in good seasons, due to excessive cost of transport and unfair competition, which is observable in more than one direction. The nationalisation of railways and their centralised management in the interest primarily of the producers is the first important step in the general reorganisation of our entire system of production and distribution for the benefit of all. In future we shall be compelled to regard the problems of our national existence from the point of view of production of wealth for use outside of the confusions engendered by money and production for profit; as we shall be brought to consider the payment of wages and their amount – so long as wage-earning continues – in relation to the high standard of life such wages must command; instead of regulating the remuneration of labour in wages by the lowest standard of subsistence which the competitive workers may be forced to accept in order merely to live. When so important a department as that of railways is avowedly dealt with in the interest of the entire community, no long time will elapse before the same idea of collective advantage, as opposed to individual interest, will prevail all along the line.

H. M. HYNDMAN.

1. Chatting a few years ago with a coalowner and distributor on a very large scale I said ‘Your precious wagons don’t carry more than one ton of coal to every ton of dead-weight which has to be hauled. A three-ton truck only carries three tons of coal.’ My friend’s reply was instructive: ‘What does it matter to me!’ he said. ‘The Railway Company does the haulage.’

2. Royal Railways, by Whately C. Arnold, pp. 23, 24

3. Mr. Roy Horniman, who has devoted much attention to this subject and is an ardent advocate of complete railway reorganisation, calculates that in the various departments of transport, beginning with the railways and improved methods of distribution based on their effective reform, a saving could be made for the community which would exceed £350,000,000 a year.

4. I have been in favour of free railway transport of home produce within the limits of Great Britain for many years. I am so still. I am, in fact, convinced that the apparent loss even of £74,000,000, the amount paid in gross for freight of goods, would be advantageously incurred in order to obtain the immense advantages in expansion of agriculture and increase of industry that would at once ensue. This £74,000,000, however, includes foreign produce on which transport charges are paid. The total apparent sacrifice would, therefore, be reduced to that extent. But I am further convinced that the benefit accruing from suggested improved railway methods and delivery and clearance of goods on the national railways cannot fail to exceed very largely, under conjoint railway and Post Office management, the £74,000,000 now received. A vast profit would in fact result. Assuming this to be correct, the point of dispute would he whether the surplus should be devoted to reduction of taxation or to free transport of home produce on the lines set forth. In the one case the taxpayers will be relieved but no increase of production will necessarily follow; in the other case production will be immensely expanded in every direction and the taxpayer will be indirectly benefited. If the general and continuous advantage of the whole community is considered throughout it is scarcely disputable that free transport will have the preference when once the question is understood by the people at large.

H M Hyndman Archive