THE STATE OWNERSHIP OF RAILWAYS
Address by Mr. W. F. Maclean, M.P., on January 5th, 1905.
Mr. President and Gentlemen o f the Empire Club,-
I will at once plunge into my subject which is "Public-owned Railways" or "State-owned Railways." There are a great many reasons in favour of a public-owned railway, and some of these reasons I will try to give you today in a conversational way. The first great reason in favour of state-owned railways is the effect of such a system on the defence of the country. The safety of our nation is the main thing to every person; and it has been found that those nations which control their own railways are the best fitted for the defence of their own countries. Germany has proved that fact. She owns almost every railroad, and those she does not at present own she is gradually taking over, first of all for the purposes of defence, and in the next place for what would be called economic reasons. Anyone can see at a glance how a well-organized railway system can aid in the defence of a country that is surrounded by hostile nations. The Roman Empire was maintained by good roads, and if the Roman Empire had existed in times like our own it would have been upheld by state-owned railways.
State ownership is also justified because it affords the best means for a systematic development of the resources of any country, and especially a new and growing one. A country finds out where its resources are and places its railways so as to best develop them State-owned railways provide the best system of transportation for local, or through traffic as it is called, and it permits of the railway transportation routes of the country being scientifically and systematically laid out and built up. Anatomists talk of an articulated system in regard to the human frame. In much the same way the only possible articulated system of railway transportation for a country is under state ownership. All the joints have a reason, are connected, and work in harmony.
A state-owned system of railways is the cheapest for many reasons. The first of these, from the point of view of economy, is that the money for building the road can be borrowed by the State at the lowest possible interest. But more than this, under a state-owned system there is no unnecessary duplication of lines and service, no waste in unnecessary competition, no waste in canvassing for business; and every dollar is spent, or ought to be spent, efficiently. Then, too, one set of terminals, stations and entrances, does for each city or possibly for a whole seaboard. As an example, ' Montreal now has two costly entrances, two costly exits; it has two stations and two sets of station officials. A large number of men are also necessarily employed to canvass for business and take care of it, whereas under a state-owned system there would be one large station with the best possible approach and conveniences, one set of docks for the shipping traffic, and a hundred other economies that the lack of harmony and cohesion between private systems now renders impossible.
A state-owned railway is always patriotic, and Canadians can easily recognize what is meant by this. Private-owned roads, as we know, may seek to build up the ports of other countries. The Grand Trunk and the Canadian Pacific today have large interests in Boston and Portland, and if it suits those interests to divert traffic from Canadian ports they do it--and do it in a minute. A state-owned railway dare not do this. But patriotism never appeals to a private-owned road. Still worse than this, private-owned roads carry the traffic of neighbouring and foreign countries through their own territory for less than they carry the freight and produce of that territory. The C. P. R. and G. T. R. are carrying the farm produce, live stock, and dead meat of the western United States through Canada for less than they carry Canadian farm produce of similar kinds. No state-owned road would do this; for would the people of any country allow the road they owned to actually offer a bonus to their rivals in business whose produce in the markets of the world is a rival of their own? These roads. now carry the passenger traffic that originates in the States across Canada for less than they carry Canadians-Canadians who have subsidised them so freely!
A state-owned railway does not discriminate in favour of preferred interests or preferred customers. That gigantic monopoly, the Standard Oil Co., has absolutely been built up on discriminations in its favour made by all the great railroads of the States, involving rebates, involving preferences for the great trusts that have private-owned freight cars and the like, and out of these trusts and discriminations come the Rockefellers, who are the financial lords and dictators of the entire country. Neither would a state-owned railway discriminate against any town, province, or trade interest as against any other town, province, or trade interest; for all are treated equally and alike, the rich and the poor, the near and the far. The poor man gets the best rate on the state-owned railway just as does the rich corporation or the rich man. Under private-ownership of railways the poor man invariably gets the worst of it. Discrimination is the greatest evil today attendant on private-owned railways. Private-owned railways can blast a place and put a blight on any interest or individual. Under state-owned railway systems the problem is how to handle the traffic of the country at the least possible cost to the people of the country. In the country where the private-owned road prevails the problem presented to the managers of every road is: How can we so handle and tax the traffic that comes to us as to pay the largest possible dividend to our shareholders, no matter how much water the shares may contain? This is also a paramount consideration.
A state-owned railway system is complementary of the waterways of the country. With a splendid system of inland navigation in a country traffic may be more cheaply handled, partly by water and partly by rail. It is therefore to the interest of a country that the waterways should be utilized. Private-owned roads invariably act against any water traffic and only take to boats when absolutely compelled to do so. If Canada had a state-owned system of railways it would work in harmony with a state-owned system of navigation, and the two together would give the lowest freight charges. State-owned railways, by reason of economy and systematization, can have the highest possible standard of railway construction in the way of double-tracking and straightest lines; that is lines free-as much as possible from curves. For the state-owned system allows the ideal railway to be built and the ideal railway is without curves and therefore straight, is almost without grades, or has the least possible grades, and is built of the highest standard of excellence generally. And this kind of road is the only one that carries the traffic of a country at the cheapest possible rate. Poorly-built and poorly-equipped roads, and roads full of curves and grades, as most private-owned roads are, can never handle traffic at the lowest possible rate.
The ideal railroad for Canada is a state-owned railway, from the seaboard of the Atlantic to the seaboard of the Pacific, double-tracked or four-tracked, without unnecessary curves and with the lowest possible grades, with branches at proper intervals running right and left. This would be a national spine and ribs. It could carry the wheat of the great West to the seaboard at the 'lowest possible cost, and at the lowest rate for freight. The lowest freight means the highest price to the grower. But it would be because the road was of the highest class of excellence, and as has been said the highest class of railway excellence is possible only when the State builds, owns, and controls, and the road is properly systematized. Wherever state-owned railways have been introduced they have steadily gained in favour. No country that has nationalized its railways has ever proposed to go back to private-ownership.
Nearly all the roads in Europe are state-owned or state-controlled. In Germany the movement is to nationalize every mile of the railways there. In a few years Prance will take over thousands of miles of private-owned roads and incorporate them with the national system. Australia and New Zealand have made a marvelous success of state-owned roads. State-owned roads in New Zealand, especially, have given the people cheap travel, cheap freight and created no great interest or class like that of the railway barons of the United States. The road in New Zealand is managed altogether in the interests of the people who use it and no one else. The private-owned roads of the United States have created the Vanderbilts, the Goulds, the Rockefellers, the Harrimans, the Hills, and all the rest of that new plutocracy which has arisen in the United States and which seems to represent now, along with the Trusts, more power than that of the President and Congress combined. They not only dictate to the Legislative system, but they can make and unmake towns and cities, can make and unmake business of all kinds and can tie up all kinds of natural products.
What worse system can one imagine than that which allows the coal deposits of the United States to fall into the hands of these railway and coal barons, as they are called? Under state-owned railways coal could be delivered all over the country into every house for one or two dollars a ton, either soft or anthracite. Now, by reason of monopolies and private-owned railways, it is in some places six dollars a ton. If there is any gift from Providence to man in a country like the United States or Canada, it should be cheap fuel; and yet the railways under private-ownership have come between the people and this providential supply of coal, and have boosted up the prices so that one of the commonest sights now in the great cities of America is the widow and the orphan going along the railway tracks picking up what stray fragments of coal they can find to fill the little basket for their day's supply of fuel. State-ownership would change this in a day, and give every honest citizen coal at cost price. The great railway interests of the United States and Canada, along with the trusts they have created, are gradually demoralizing the Legislatures, the press, the municipal institutions, and even the Courts. Half the social disorders that exist in the United States can be traced to the private-ownership of railways. The money that floods this country at election times is railway money.
The state-owned railway system treats its employees better than the private-owned system. The private-owned railways in Canada, following the example shown in the United States, are ready to discard a man after he has reached forty years of age. How serious this is only the man in the service can fully appreciate, but the public are beginning to ascertain the facts. State-owned railways would pay the men better wages and would provide a system of pensions. The public could depend on a better service. The state-owned system of railways has been proved to be the best and the cheapest. In Austria-Hungary, where the country is divided into zones, the people travel at less than a cent a mile. Labour, especially, is free to go wherever work is to be had. And at the same time the operation is done at a small profit. The private-owned railways in the United States have become so powerful and are so interested in the expressed cost connected with them that they have had sufficient influence to prevent the adoption of a parcel post system in the United States similar to that found in Great Britain and Germany, and have paralyzed any effort in the direction of adopting the English and German system of money transfer by Post office Orders. The railway lobby at Washington has time after time killed off attempted legislation to improve the parcel post system and the introduction of a money transfer system, such as they have in Europe. Where there is a state-owned system the railways handle all mails, handle the express packages, and transfer of money; and the small package freight, in the way of basket produce going to market has been enormously developed. Under the private-owned roads of the United States no such convenience and progress is to be noted. The state-owned railways of the various countries of Europe have enabled the farmers of Europe to get into direct touch with the consumers through this basket-produce system.
We are not so progressive as we think we are. In former days the King's highway was free to every one, and all the produce of the land and the output of industry went upon it and over it. Since then we have degenerated; we have allowed great thoroughfares to be built through the country under private control. A railway ought to be nothing but the King's or the people's highway with a set of tracks upon it; and the sooner we get back to this idea the more benefit there will be to those who have to use it. There is no good reason why the railways of Canada could not be nationalized tomorrow, and the principle of Public Ownership applied not only to the post-office, but to the railways, telephones, telegraphs, express and money transfer business, and all those great public utilities made to serve the people instead of, as now, the private monopolies that control them. There are a great many more reasons why we should have public or state-owned railways which I will not give you today; and I have no doubt that there are a great many reasons against state-owned railways, and if the gentlemen present will formulate any questions they may desire to ask I will endeavour to answer them at some future meeting.