5 8z THE POPULAR SCIENCE MONTHLY. 



gressed, the rates have been raised, so that "there is not a producer 

 that does not pay heavier tribute than conquered people ever paid their 

 conquerors."* This is the common expectation and belief. I think 

 there are many who will be disappointed to find that it is not true. 



The Central Pacific charged, on its freight traffic in 1872, the av- 

 erage rate of 2 - 96 cents ; f in 1881 this had been reduced to 2*16 cents ; J 

 an average decrease in the past ten years of eight tenths of a cent on 

 each ton hauled one mile. This is a reduction upon that local traffic 

 which is commonly supposed to be beyond the control of any compe- 

 tition, as well as upon through traffic. This is shown by the fact that 

 the increase of local tonnage for the period was 216 per cent, while 

 the increase of receipts from the same source was but 162 per cent.* Had 

 the average rate of 1872 been maintained by the company on its freight 

 traffic for 1881, the receipts would have been $5,866,287 || more in the 

 latter year than they actually were. During this period of ten years, 

 in which there has been a continuous reduction of rates, the compe- 

 tition by water has remained without change, and competition by rail 

 has not existed ; yet, under the control of the natural laws of trade 

 there has been such a reduction in the rates on frieght that it now 

 amounts to the annual sum of over five and three quarter million dol- 

 lars. This additional amount of earnings would have enabled the rail- 

 road company to pay a dividend, in 1881, of sixteen per cent, instead 

 of the six per cent which was paid. 



It should be observed, also, that the miles of road operated during 

 the period under consideration have been increased from 1,158 in 

 1872 to 2,707 in 1881, A a greater portion of which increase has been 

 upon roads built through places almost entirely without inhabitants, 

 and which, as a consequence, for the first few years could furnish but 

 a limited traffic. It will at once be seen that the rates necessary, under 

 such conditions, to pay the cost of service, must have been much higher 

 than in districts where a population and trade already existed. The 

 traffic on these newer portions of the road having been carried at rates 

 which were justly, because necessarily, higher than over the older 

 portion of the line, has had the effect of making the average rate of 

 the whole, in 1881, much higher than it would have been had no new 

 roads been built. 



A fair consideration of these facts must, it seems to me, lead to the 

 conclusion that there has been as great a reduction in the rates of this 

 Western system of roads as has taken place in the same time upon any 

 of the Eastern lines. 



It is difficult to make any comparison between the operations of 



* "Anti-Monopoly Address," p. 15. 



f " Central Pacific Railroad Annual Report," 1872. 

 % Poor's "Manual," 1882, p. 868. 



* Computed from Annual Reports of the Company for 18*72 and 1881. 



1 Poor's " Manual," 1882, p. 868. A "Annual Report," 1881, p. 16. 



