Evening journal., 1916-06-15

TEN, as already indicated. not only
paid interest and dividends, but has
surplus. To have paid per cent.
interest, and paid taxes and put aside
surplus in the same proportion, the
Intercolonial would have had to col
lect from the public S1l, 800 for each
mile, of its line, or is per cent. per
more per mile than the Canadian Pa
cihc eastern lines did
1T is clear that the services Of the
Canadian Pacific, while profitable to
its owners. cost the public much less
in proportion than that rendered by
all paid by those who receive the SER
vice, while only from one-half to
three-fourths Of the total expenses
incurred by the Intercolonial are
borne by those who receive its SER
vice The rest is borne by the tax
payers.
"The question naturally arises as TO
why the total expenses of the Inter
colonial are so great. Its cost of
construction investment in it
is excessive according to the stand
ards of Canada and the United States.
The average capitalization of the rail-
ways Of the United States in 1914 was
only $6G,661; and an average mile o..
their line was a much better piece OF
property and handled substantially
more traffic than an average mile of
the Intercolonial. The average cap
italization Of the private railways OF
Canada, excluding Implications. was
$685. The explanation Of the In
tercolonial's large cost of construc-
ton must be that expenditures on it
have been made wastefully, or that
its accounts have not always distin-
guished accurately between expendi-
lures for construction and opera
| ton"
Analyzing the operating expenses
of the Intercolonial, Mr.. Dunn hnds
that while its traffic was about 6.5
per cent. greater per mile than that
of the Canadian Pacific. it spent less
in 1914 on the upkeep of its tracks
and structures than the Canadian Pa
cific. but 1875 per cent. more for
maintenance of equipment" 16.5 per
cent more for traffic expenses 13.5
per cent. more for conducting trans
portation." and so per cent. more for
general expenses per mile. "One OF
1.-THE surest indications of unecOnomi-
cal and inefficient management" he
SAYS. "is that a road is spending a
relatively small part " its earnings
/ for maintenance and a relatively
large part for conducting transporta-
ton and for general and traffic pur-
] poses. What is spent for mainte-
nance goes into the physical property
and helps TO keep up or improve the
service. while what is spent for con-
Quoting transportation and for gen
eral traffic purposes add to the ply
sical property, but is gone forever
"The major cause of these results,
saws Mr.. Dunn, has been the influ-
ence Of politics. The prevailing low
rates have been made as a sop to the
people. and especially to the French
population. of the eastern provinces
Il was formerly customary for the
party in power to buy railway sup
plies only from its supporters It was
common practice largely to increase
the number Of employees some weeks
before election. and every officer OF
tn road frequently had the experience
of coming to his Office and finding
among his subordinates the faces oi
men he had never seen before, ano
who had been put on his payroll al
the instance of politicians. Political
Influence was used not only to Sc
cure excessively large and expensive
passenger stations. but also unneces
sary and Improbable passenger anC
freight service"