The Washington herald., 1907-09-23
State.owncd Railroads


Advocates Of the government ownership
of railroads have a notable recruit in
Lord Brassey, who enjoys a weII-earned
reputation as an economist and publicist
in all English-spe5king countries. In an
address before the Liverpool Chamber Of
Commerce. Lord Brassey declared that
he was in favor Of the state ownership
OF railroads. on the ground that there
was a growing demand that the railroads
be operated solely in the interests Of the
public. and not for the benefit Of the
shareholders. He thought there was
hardly a doubt that Parliament would
sanction a change Of policy II Il were
seriously proposed.
Lord Brassey coutrGsted the continental
system of government-owned roads with
the private system of Great Britain. 20
the disadvantage Of the latter Where
railroads We're the property of the state,
he said, the requirements Of the public
were fully considered and the results to
the treasury satisfactory. while fin Great
Britain competition was carried TO ex-
cess. an immense amount Of capital was
wasted. shippers were dissatisfied with
the burdensome rates. and the employees
were disconnected with their wages and
hours Of labor" The analogy Of the
British railway situation with our own
viii be at once noted. but many people
VIII be surprised by Lord Brassev s
confession that the English system is
productive Of results less satisfactory 20
both the public and the owners than gov
erBment-operated roads
We are seeking. in this country. to
remedy complaints of high rates and
oyercapitalizatiOn by means Of govern
ment regulation. Mr. Bryan and others
are Of the opinion that such regulation
will ultimately lead to government own
ership and operation Of railroads. The
prediction is by no means so fanciful rs
it may seem. To a very remarkable ex-
tent State railroad commissions are
undertaking to regulate the actual phys
ical operation of roads and Chairman
Knapp. of the Interstate Commerce Com
mission. has said that the commission
viii eventually take steps in the same
direction Railroad managers are already
complaining that the discipline Of their
employees is being relaxed because Of
division of control between government
and railroad authority. If State legisla-
lures insist that passengers and freight
be carried at unremunerative rates, there
would seem TO be no alternative to banka
ruptcy but government ownership, under
which dividends would be subordinate to
cbeapened public service Moreover, it
may become a serious question whether
private capital viii invest I'm railroad en-
terprises under the limitations as to In
come fixed by public regulation. II that
case the people would have TO do with
out railroads or authorize their govern
ments % build and operate them.
Government ownership is long way
of, if it ever comes in these United
States yet who can doubt the logic Of
Lord Brassey's proposition that if rail-
roads must be operated solely in the in
terest Of the public, they must be so
operated by government? To encourage
railroad building and insure efficient
private management we must permit the
private owners of railroads to make Sc
cure and reasonable profit out of their
Investment condition compatible with
reasonable rates Of service and reason
able public regulation of railroads. and
one which wholly avoids prospective gov
eminent ownership, with its imposing
problems and positive perils.