PRESIDENTIAL ADDRESS. 779 



I am Inclined to think that the effect of the evidence is that the further 

 a Government departs from autocracy and develops in the direction of democracy, 

 the less successful it is likely to be in the direct management of railways. 

 Belgium is far from being a pure democracy ; but compared with Prussia it is 

 democratic, and compared with Prussia its railway management is certainly 

 inferior. Popular opinion in Belgium seems at present to be exceedingly hostile to 

 the railway administration ; official documents assert that, while the service to the 

 public is bad, the staff are scandalously underpaid, and yet that the railways are 

 actually not paying their way. There was, it is true, till recently an accumu- 

 lated surplus of profits carried in the railway accounts, but the official figures 

 have been recently revised, and the surplus is shown to be non-existent. 



The Swiss experiment is too new to justify any very positive conclusions 

 being drawn from it ; but this much is clear : the State has had to pay for 

 the acquisition of the private lines sums very much larger than were put for- 

 ward in the original estimate; the surplus profits that were counted on have 

 not been obtained in practice ; the economies that were expected to result 

 from^ unification have not been realised ; the expenditure on salaries and wages 

 has increased very largely ; and so far from there being a profit to the Federal 

 Government, the official statement of the railway administration is that, unless 

 the utmost care is exercised in the future, the railway receipts will not cover the 

 railway expenditure. 



The Italian experiment is still newer. It would not be fair to say that it 

 proves anything against State management ; but I do not think that the most 

 fervid Etatist would claim that, either on the ground of efficiency or on the 

 ground of economy, it has so far furnished any argument in favour of that 

 policy. 



If we wish to study the State management of railways by pure democracies 

 of Anglo-Saxon type, we must go to our own Colonies. My own impressions, 

 formed after considerable study of the subject and having had the advantage of 

 talking with not a few of the men who have made the history, I hesitate to give. 

 It is easy to find partisan statements on both sides ; for example, in a recent 

 article in the ' Nineteenth Century,' entitled ' The Pure Politics Campaign in 

 Canada,' I find the following quotation from the ' Montreal Gazette ' — a paper of 

 high standing— dated May 27, 1907 : ' Every job alleged against the Russian 

 autocracy has been paralleled in kind in Canada. First, there is the awful 

 example of the luter-Colonial Railway, probably as to construction the most costly 

 single-track system in North America, serving a good traffic-bearing country, 

 with little or no competition during much of the year, and in connection with 

 much of its length no competition at all, but so mishandled that one of its 

 managers, giving up his job in disgust, said it was run like a comic opera. Some 

 years it does not earn enough to pay the cost of operation and maintenance 

 (I may interpolate that its gross earnings per mile are equal to those of an average 

 United States railway), and every year it needs a grant of one, two, three, or four 

 mQlion dollars out of the Treasury to keep it in condition to do at a loss the 

 business that comes to it. When land is to be bought for the road, somebody 

 who knows what is intended obtains possession of it, and turns it over to the 

 Government at 40, 50, and 100 per cent, advance. This is established by the 

 records of Parliament and of the Courts of the land.' 



Probably no one outside the somewhat heated air of Canadian politics is likely 

 to believe this damning accusation quite implicitly ; but even if there were not a 

 word of truth in it— and that the management of the Inter- Colonial Railway is, 

 for whatever cause, bad, appears, I think, clearly from the public figures— it is 

 bad enough that such charges should be publicly made and apparently believed. 

 Let me quote now from a document of a very different type referring to a 

 colony very far distant from Canada: 'A Memorandum relative to Railway 

 Organisation, prepared at the request of the Railway Commissioners of the Cape 

 Government Railways, by Sir Thomas R. Price, formerly general manager of those 

 railways, and now general manager of the Central South African {i.e., Transvaal 

 and Orange River) Railways, dated Johannesburg, February 22, 1907, 



