The Washington herald., 1913-10-12
TELEGRAPH CONTROL
, COSTLY TO ENGLAND
Total Loss to Government in More
Than Forty Years Has Been
$87,279,305
SUBJECT OF MAGAZINE ARTICLE

An article showing that forty years OF
postoffice telegraph monopoly in England
has produced a government deficiency OF
SS,27s,3O5 appears in the current issue OF
the Postal Telegraph 1t is of especial
| interest now, in view OF the report that
Postmaster General Burleson may repeat
the recommendations of his predecessor
that the government acquire all telegraph
lines.
This article is made up Of extracts
| from the London Times. After reciting
that when Parliament was induced to
| transfer the telegraph lines to the State
in 1870, it believed that the government
monopoly would bring a profit that would
make the lines self-supporting and en-
! able the establishment OF a large sinking
fund, the article goes on to say:
"rorty years of postoffice telegraph
monopoly have produced a total de-
ficiency OF E17,455, ,S61 CSS7, ,279 3O5) for inter
est, excess Of working expenses over re-
ceipts, and expenditure of a capital ma
| ture. The tax payer has paid an aver
age Of over E+OOOO0O Cs2.OOO,OOO) a year for
the last forty years, and is now paying
at the rate Of over sS4O,OoO G4,2OO,oOO a
year for the luxury of having the tele-
graphs operated by the government in
stead of by private enterprise
After speaking of the assertion some
times made that the cause of the loss on
the telegraph lines is the high price paid
for the business in $50. the article says:
There is no truth in this assertion, as
the interest on the original capital, now
at the rate of e27l,6 ,6g1 CS1,3 ,455) a year.
is not paid by the pOstoffice, but out of
the consolidated fund. For all practical
purposes the pOstoffice treats the tele-
graphs as if they had been a present
granted by a grateful nation to a
worthy departmental a cost of $40 S67,-
900 (S54. .35J, 0O0l. on which the nation, with
annually recurring kindness, pays the in
terest. The postOffice keeps no telegraph
capital account and is unable to consti E
tute one.
Capital expenditure since 1875 has
been provided by the Treasury, and
has gone into the bOttOmless pit, no
interest being paid on it. Present
telegraph capital expenditure is at the
rate of about 100000 $1,000, ,OOO) a
year, and, although, according to the
return, the information at the disposal
of the department is not sufficient to
permit of the preparation of a capi-
tai account the information at the
disposal Of anybody who studies the
annual returns indicates that ElS,0OO.-
900 $3.50, ,OOO. .OOO) is a fair estimate OF
the total telegraph capital expenditure
down to 1909"
OF the failure of the government to
make the business self supporting the
article has this to say:
The main reason for the failure OF
the postoffice to make the telegraph
self-supporting is unCommercial and
extravagant management, due in a
large measure to political control In
1870, the first year of postOfice man
agement. the working expenses OF the
telegraphs were G347,OOO Cs1,735, ,OOO).
BY 1875 they had increased to G1.O1O.-
900 ($5,O5O. .OO0), an increase Of nearly
200 per cent in four years. totally dis
propOrtionate TO increase of traffic but
due principally to the extravaganza of
government methods of conducting
business.
In the forty years during which the
pOstofice has controlled the telegraph
business of the country innumerable
improvements in telegraph machinery,
lines, and methods Of working have
been made, which have largely in
creased the capacity of the plant. Yet
the ffteen-word message of today
costs the postoffice appreciably more
to handle than did the thirty-word
message of twenty five years ago"