RAILWAY RATES.
Y a strange irony of fate, the Government has been defeated in the House of Lords. It might have been supposed that on no conceivable question would the Upper House, after an appeal for support made by a Conservative Prime Minister, produce a majority adverse to the Government. Yet such has been the case. Of course the vote was in no actual sense a hostile one, and of course it will be at once rescinded if the Government are determined to carry their clause. Still, the circumstance affords another proof of the way in which, on occasion, all deliberative assemblies have a tendency to be wilful, and to act independently of the advice of leaders whom as a rule they follow with implicit obedience. Though the question—preferential railway rates—which occupied the Lords on Tuesday night was of no common interest, it cannot be said that the speeches on either side were of a very perspicuous or enlightening order. Indeed, a total absence of lucidity was the leading feature of the debate. Points of law, points of logic, and points of political economy were hopelessly jumbled together by each speaker in turn. We shall not, then, be reflecting upon the Upper House in any hostile spirit if we say that probably the greater part of the majority did not, in reality, the least understand the issue on which they were voting. Unfortunately for the Government, their case seems not to have been stated in at all a convincing way. If the Government had been able to put up some experienced advocate to go into all the arguments and explain the whole matter to the Lords, as a leading counsel on circuit explains a complicated and difficult case to a common jury, they would in all probability have made things clear enough to prevent the hostile vote of Tuesday night. As it was, the Peers were left with a general impresssion that the amendment would give more help to the farmers than the clause as it stood, and so they naturally enough voted for the alteration.
Without attempting to analyse here all the complications and perplexities of argument introduced into the Lords' debate, we propose to state briefly one or two propositions which may tend somewhat to clear the discussion of the subject. In the first place, we may take it as admitted that no system of rates can be right and fair under which a Railway Company carries English produce at 22s. 4d., while foreign produce is carried over the same distance for 8s. 4d. How this preference works out may be clearly seen in some figures quoted by Lord Wal- singham, from a leaflet issued by Messrs. Watson, Todd, and .Co., of the Midland Flour Mills, Birmingham. A farmer on the East Coast can produce from an acre of good land a ton of wheat. To get this ton of wheat carried to Birmingham, he has to pay 22s. 4d. Foreign wheat can, however, be brought from Cardiff to Birmingham—the same distance—for 8s. 4d. The farmer, therefore,has the Birmingham market closed against him unless he pays, as it were, a bounty of 14s. for the privilege to compete with his foreign rival. In fact, the disadvantage under which the English farmer labours is equal to another rent. "Also," the leaflet continues, "as an acre of land planted with potatoes will produce seven tons, and as the difference between the English and foreign rates to the consuming market is 14s. per ton against the English producer, the East Coast farmer has to pay a bounty to the railway of £4 18s. per acre, in addition to what is paid by the foreigner, to send his acre of potatoes to the Birmingham market. Hence, if a farmer in the East of England grows 100 acres of potatoes and sends them to Birmingham, he pays the modest sum of £490 more freight than is paid by the foreigner on a like quantity, for an equal distance." In view of these facts, the English producers have demanded that they shall have fair treatment, and that the Railway Companies shall be forbidden by Act of Parliament from giving any preference to foreign produce. This demand has, of course, been stamped as Protection by those who support the Railway Companies' right to fix their rates as they choose. The consumer benefits by the present system, it is alleged, and the farmers and landlords are simply asking that the consumer shall be sacrificed to their interests. Is this a fair way of stating the case? No doubt, if the land- lords and farmers said, in order to keep out foreign competition, the railways shall be forbidden to charge cheap rates, the consumer would have a very genuine grievance. The farmers and landlords, however, do not make any such claim. What they say is this,—Why should the railways be allowed to exclude us from benefiting the consumer by bringing him cheap produce as well as the foreigner ? It is not we, but those who desire to maintain the preferential rates, that in reality are the enemies of the consumer. It is, of course, very difficult for the railways to meet this assertion, and the demand it is followed by. They cannot well deny that they make a profit out of conveying foreign produce at low rates, for to do so would partake too much of the nature of the state of mind of the old woman who asserted that she lost a farthing on every apple, but praised the Lord that she sold a great many. They have, therefore, to fall back upon saying that they can only carry foreign produce so cheaply because they take enormous quantities. But this really does not serve them, for no one objects to reductions of rates on taking a quantity, so long as those reductions are allowed to every one. It is, however, sometimes alleged on behalf of the railways, that they simply take the foreign produce at a rate which hardly pays them, in order to prevent its being taken by coasting steamers. But if this is so, we can hardly see why Parliament should mind insisting on disallowing preferential rates, since this strong assurance that the produce will still be got to market, and that a healthy competition will be developed between the steamers and the Railway Companies, takes away all fear that the consumer will be injured. Outside those who consider the interest of the railways before any other, and who use such arguments as we have just stated, there is, however, a pretty general agreement that the English producers have a distinct grievance which demands a remedy. A few extreme advocates of free contract may argue that the Railway Companies ought to be allowed to make any bargains they please ; but even these persons can hardly deny to Parliament, which has granted the railways such enormous privileges, the right to see that the Companies do not exer- cise those privileges to the detriment of any class in the com- munity. Some of those who admit the grievance argue that there is no need for further legislation, because the law as it stands at present is quite powerful enough to cope with all unfair treatment by the Companies. The Government, how- ever, declare that the law as it stands requires improvement. They consider, nevertheless, that to forbid in general terms all preferential rates would do more harm than good. They recom- mend, therefore, that the law should be altered in such a way that whenever it is shown that any Railway Company charges one trader or class of traders, or the traders in any district, lower rates for the same goods than they charge other traders or classes of traders, or the traders in another district, or that there is a preference shown in the treatment of foreign merchandise over British merchandise, the burden of proving that the difference in treatment does not amount to an "undue preference" shall lie on the Railway Company. The clause in the Government Bill goes on to say that the Courts or the Commissioners, in deciding what is undue preference, may, so far as they think reasonable, take into consideration whether the difference of treatment "is neces- sary for the purpose of securing in the interests of the public the traffic in respect of which it is made." This provision is, however, guarded in the producer's interest by the proviso that the Court or Commissioners shall have power to direct that no higher charge shall be made " in respect of merchandise carried over a less distance, than is made to another person for similar services in respect of the same description and quantity of merchandise carried over a greater distance on the same line of railway." If this clause works in the manner intended, it must be admitted that there is a very great deal to be said for it. Lord Jersey, however, as the spokesman of many of those who are deeply interested in the subject, refused to accept the clause as sufficiently strong, and accordingly proposed an amendment forbidding in general terms any different treat- ment to be made between British and foreign merchandise. In the debate that followed, it was several times pointed out that Lord Jersey's amendment in reality went much further than he and his friends intended. Its effect would be to forbid a Company taking 100 tons of foreign produce at a low rate, unless they were prepared to take 100 lb. of English produce at the same rate. Such a result cannot possibly be contemplated by any advocate of the English pro- ducer. It would obviously be a fatal restriction on the busi- ness of the Railway Companies. Yet this would be the result of the resolution. On the other hand, in affording legitimate help to the English farmer, it would not be more effective than the Government clause. In fact, Lord Jersey's amend- ment would do either too much or nothing at all.
No doubt the whole matter will be debated again at length in the House of Commons, and we shall then have the advantage of hearing the opinions of trade and railway experts. Still, on the showing of the present debate we believe that the Government clause carries out the common object far better than does Lord Jersey's amendment. That there is any fear of the railways being financially damaged by the clause, we do not for a moment believe. Probably they will find in the end, as has so often happened before, that lowering their rates will only mean raising their profits. Parliamentary trains, with a penny a mile fares, were forced upon the Companies ; yet now they find it profitable to carry passengers at still cheaper rates. No doubt the railway interest will warmly oppose the present Bill in the House of Commons. It will not, however, be wise to carry that opposition too far. If the Companies insist too much on the right to settle their own rates and to conduct their business as they choose, Parliament may be forced to consider the question whether it shall not far more readily sanction competing lines than it does at present. The landlords, it must be remembered, are nowadays only too glad to sell land cheaply, in order to get railways to open up their markets. As long as the railways have virtual monopolies, they must expect regulation. The alternative to such regula- tion is the encouragement by Parliament of free competition in railways. Surely the Companies will not be so rash as to court the introduction of such a policy as this ?
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