Year: 1874

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A NATIONAL FREIGHT RAILWAY


The bill recommended by the House Com
of which we printed an abstract yesterday,
can hardly be called a practical scheme of
legislation just now, and yet it deserves
careful consideration. The report ITSELF while
it gives q general approval to the provisions
of the bill, and even advances careful argu-
ments in its support, does not urge immediate
action upon it, but rather sets it forth for the
deliberate approval of the people. We gave
synopsis of the bill when it was
referred to the Committee last January.
1t contemplates the construction OF double
track freight railroad from New-YOrk to the
Missouri River, and the regulation of tolls by
national legislation. Bulk freights, such as
grain, coal, ores. lumber, provisions, live stock,
&C., are subject to a maximum rate varying
from one cent per ton per mile for distances
under 100 miles to five mills per ton per mile
for distances over 750 miles, with an addi-
tional charge of one mill per ton per mile
during the Winter. The maximum rates for
other freights are to be fixed by board OF
five Commissioners, three to be appointed by
the President and Senate and two by the rail
road.


In this plan will be found the main princi
ple upon which we believe the transportation
difficulty must ultimately be settled-namely,
a complete separation between the passenger
and freight business. We cannot shut our
eyes TO the fact that in spite of tolls so heavy
as to destroy the prosperity of vast fertile re-
gions, and seriously check the development OF
the country, the railroads are not making ex-
orbitant profits, and many of them are paying
no dividends How far this unsatisfactory
condition of affairs is the result of stock
watering and other illcgitimate mutations
of railroad capital, we need not now inquire.
1t is too late to reduce the capital to the
actual cost without gross injustice to innocent
investors and the destruction of interests
which are closely bound up with the welfare
| of the farmer. The plain truth is that rail
roads, as they are now built and managed,
cannot carry wheat from Iowa to the seaboard
at cost which will give the producer a
reasonable profit on his labor and outlay.
Legislation may relieve some few locali-
ties by preventing unfair determinations ;
but back of the minor wrongs Of
this or that particular county lies
the indisputable fact that the actual cost Of
| railway carriage is greater than the farmer
| can afford to pay. We see no means by which
this cost can be materially reduced unless
freight trains are enabled to move at uniform
rates of speed, along easy grades, and by the
shortest through routes and to keep moving
all the time; and they cannot do this, of
course, unless passenger trains are put out of
their way.


The great problem is the cost of construc-
ton. The bill proposes that the road shall be
built by private capital, but the United States
shall guarantee five per cent interest on its
bonds to the amount of $4,000 per mile of
single track-the whole extent not to exceed
5000 miles of single track or say $60,000,000
worth of bonds at $3000,000 annual interest.
TO secure this loan the Government is to hold
first mortgage on all the property of the
company, and as soon as the main line is open
for traffic the company is required to pay over
to the Government one million dollars yearly
towards the reimbursement of the interest
advanced. The share capital is to be
$1OO,OOO,OOO, and the company is au-
thorized to sell bonds to an equal
amount, provided it can GEE at least 95 cents
on the dollar for the guaranteed bonds, and
IS for the Others The cost of construction is
roughly estimated at $2OO,0OO,OOO but it is
evident that there are no data for close and
trustworthy calculation. Running through q
thickly settled and valuable region, the road
would have to pay an enormous sum for the
right of way, while the crossing of the Ale
ghanies by direct route, and yet with easy
grades would involve very costly engineer
ing. 1t may be a question, therefore, whether
the interest on the outlay would not
be so heavy as to rcounterbalance the
saving III the expenses of operating.
Surely we have had experience enough with
Government railroads to foresee the inevitable
result. There would be no surplus Of million
year to reimburse the United States for ad-
vances of interest. The mortgage would be
practically no security, since it would never
be foreclosed. Year after year the company
would come back to Congress for fresh grants,
extensions, and notifications, and the aid pro-
posed by tho present bill would be only the
entering wedge. If the scheme is to be carried
out at all, we may as well consider at the
start whether the United States shall pay q
large proportion of its cost for that is what
it will come to in the end. At present the
country is in no mood for listening to any
such proposal.


BOG US AMERICANS


The hill now before Conpress for dofn;n,