One favourite proposal, often refuted but constantly renewed, is to base rates on the actual cost of conveyance plus a reasonable return on the capital invested. Whether this would benefit the trade of the country we shall by and by consider.

But it is no light presumption against this principle that, though so often proposed, especially by theorists, nowhere has it been carried out. Obviously cost of conveyance bears no relation to value of goods—the mere transit of some descriptions of very valuable goods costs as little as that of low priced articles. It will be generally found that when pressed, the advocates of this theory are not prepared to maintain that for a cwt. of coals and a cwt. of copper the charge should be the same. They shrink from the application of their own principle, recognising, as is the fact, that it is absolutely inconsistent with any classification of goods, such as traders and the Board of Trade have been urging the companies to adopt.

Inconsistent as such a principle is with any kind of classification of goods, and leading to the consequence that a rate might be the same for a bale of cotton as for high priced silks, its effect might be to revolutionize trade. But there is a preliminary difficulty; how is the cost of conveyance to be ascertained with anything like accuracy? How is the cost of conveying a particular consignment or even the average cost of every kind of traffic to be found? What the transit of full loads of coal in this country, or of grain in America, from point A to point B costs may be approximately found. Allowances may be made for the maintenance of the permanent way, for cost of engine power, and the wages of drivers, guards, &c.; and calculations, more or less accurate, can be made as to the cost of conveyance even over lines of varying gradients. The solution even of this simple form of problem would be difficult. When in cases before the Railway Commissioners it has been attempted to discover the actual cost of conveying a particular kind of traffic, the operation has been laborious. The companies interested have been compelled to incur great expense in procuring returns and information, and the result has in general been only approximately accurate. Very complex and difficult is the real problem. A large portion of the traffic of the country is carried in trains which pick up and set down wagons at intermediate stations. In the same truck may be goods of all classes and different quality or bulk for different destinations. One article of great bulk and light weight may be carried in a truck by itself or along with articles of great weight and small bulk.[4] There is a further difficulty in the fact that, while certain fixed expenses remain much the same, no matter what may be the volume of traffic, the movement or operating expenses increase with the traffic. It may be confidently stated that no trustworthy data as to the cost of conveying each consignment or each class of goods in the actual intricacy of business could be obtained. At best only estimates could be roughly arrived at by arbitrarily making allowances and assumptions. Will those who talk about cost of service reveal the formula by which they can accurately calculate the cost of carriage of a particular article carried in the same truck with a dozen others, all coming from different places and destined for different stations over three or four different lines, the cost of no two of which has been the same, and the working expenses of which are totally dissimilar? If they have discovered this formula, it remains to be stated how it may be applied.

So serious are the difficulties in the way of ascertaining the facts as to cost of transport, so varied are the circumstances in this country, that it is not surprising that in every instance in which the principle has been brought before a Parliamentary Committee or Royal Commission it has met with the condemnation expressed by the Select Committee of 1872—“it is impracticable.”[5]

If the use of each wagon were charged for, according to its capacity, the cost of conveyance per truck could, no doubt, be approximately known. Whether such a system is the best for railway companies need not be here considered; certain it is that it is extremely undesirable in the interest of the trader. According to it, he must pay for a five or a ten ton wagon, whether he filled it or not, and whether the merchandise which he sent was silk, bales of cotton, or fruit. The system of charging so much a wagon instead of so much a ton—wagenraum tarif, as it is called—is, to a considerable extent, in force in Germany and Holland. In both these countries, however, it has been found incompatible with the necessities of commerce to abide strictly by this principle. One curious result would be brought about by charging per wagon—there would be a return to practices some forty years ago given up in England as needlessly costly and unsuitable to business. Every customer of a railway does not want a whole truck. He wishes to send ten cwt. of bales or a cask weighing one hundredweight; he could not send his goods if he had to pay for a full truck. To provide for the wants of the great mass of traders and the ordinary requirements of business, intermediaries between the railway companies have sprung up in Germany and Holland. Indeed, the great bulk of the traffic in the latter country is carried by carriers or forwarding agents in full wagon loads. The company is practically only a toll taker. The forwarding agents charge the consignor or consignee of the goods sums over and above the tolls or rates paid to the companies. So far as a large part of the public is concerned, the rates of the companies are, in those countries, mere paper rates. Not being able to take a full wagon, small traders must pay what the forwarding agents demand, or make special terms with them. This is very much the state of things which existed in England before 1844, when the companies were, as a rule, merely owners of the road, locomotives, &c., and when they left to private persons the business of carriers. Those who can recall that time, or who reflect what the results of such a system would be, will scarcely wish for its return; it would be indeed a lamentable retrogression, injurious alike to the public and the railway companies.[6]