504 THE POPULAR SCIENCE MONTHLY. 



On the other hand, we have the remaining items which are directly 

 affected by and vary with the particular kind or quantity of the traffic, 

 namely : 



Conducting transportation 1 G3 per cent. 



Motive power 12'2 " " 



And say one half maintenance of rolling-stock 5 06 " " 



Making a total of 33-55 " " 



We may say in very general terms, but which are sufficiently ac- 

 curate to illustrate the principle, that 66*45, or say two thirds, of the 

 expenses of tlie railroad are unaffected, or affected in a slight degree, 

 by the quantity of the traffic. With one train or ten trains a day two 

 thirds of the expenses would remain without great change. By the 

 increase of traffic the remaining one third of the expenses would be 

 increased, though still not in proportion to the increase of traffic — as 

 it costs no more for the wages of train-men, for instance, whether the 

 cars are half-empty or all loaded to their full capacity. 



An established traffic, then, which at the rate of one cent per ton 

 per mile would pay all expenses, including interest on the investment, 

 might be increased in volume with an increased cost of but one third 

 of one cent per ton per mile. All in excess of that sum would be a 

 profit to the company. So a lower class of freight at a rate of one 

 half a cent, instead of being carried at a loss, or at the expense of the 

 originally established traffic, would not only pay the additional ex- 

 pense incurred in its transportation of one third of a cent, but a profit 

 also of one sixth of a cent per ton per mile. This small rate of profit 

 multiplied by many tons may become a greater sum than the higher 

 rate applied to its smaller tonnage. So it comes to pay a great part of 

 the fixed expenses, and by relieving the higher-rate traffic of a portion of 

 that burden allows reductions in the rates charged on that traffic which 

 theretofore were not possible. The process continues indefinitely. 

 Traffic formerly at higher rates is then stimulated by lower rates, with 

 the hope of increasing its volume, and so of the net amount of profit in 

 its carriage. New industries become possible where the former cost of 

 the service on the movement of their products precluded their trans- 

 portation. The principle which in the commencement led to a dis- 

 crimination in favor of certain staple commodities, in the end results in 

 reducing the rates on nearly or quite all articles composing the traffic. 



The proposition, therefore, that the transportation of things at 

 lower rates is carried at the expense of things at higher rates, though 

 fair in sound, is false in fact. The error is in the assumption that all 

 traffic is alike, that it is the same kind, quantity, and value. Remove 

 these elements, and the proposition becomes a truism. Remove them, 

 too, and the discrimination disappears. Or, if not, there being no dif- 



as these figures are at best but approximate, the principle of the illustration is not af- 

 fected, whether any item is either more or less. 



