To show how the thing should be done would involve matters of detail which would be out of place here. What we desire to show is the principle. Instead of paying all men alike, good, bad, and indifferent, let the amount of a man's wages depend on his skill and intelligence; the more he shows, the better let him be paid. In almost every department of manufacturing and commercial business this is done. Why not in railway management?
We subjoin a tabular statement of the railways of the world, made up to 1857, except those of the United States, which are for 1858-9.
---------------------------------------------------------------------- |Name of country. |Cost per|Receipts |Percentage of|Percentage of | | | mile. | per mile| expenses to | net earnings | | | | of road.| receipts. | to total | | | | | | capital. | |-------------------|--------|---------|-------------|---------------| |Great Britain |$173,040| $13,296 | 47 | 4.00 | |Australia | 169,225| 6,810 | 72 | 1.02 | |India | 51,400| 8,645 | 42 | 4.09 | |France | 128,340| 13,530 | 44 | 6.58 | |Belgium | 81,955| 10,790 | 58 | 5.48 | |Austria | 92,325| 13,430 | 54 | 6.75 | |Prussia | 72,430| 9,915 | 45 | 7.44 | |Other German States| 66,160| 7,085 | 63 | 5.52 | |United States | 41,376| 6,170 | 60 | 5.51 | ----------------------------------------------------------------------
From this it will be seen how much economy of working has to do with paying a dividend,--as in the case of the Indian railways, where, although the receipts are very small, the prime cost and expenses of working are also very small, and they divide 4.09 per cent, while the Australian railways, whose cost and expense of working are large, can pay only 1.02 per cent. It is proper to say, however, that this was during the "gold fever." Railways are now built in Australia for $50,000 per mile.
The railways of the United States occupy a very favorable position, both as to cost and amount of receipts per mile. During the last ten years, the principal efforts of their managers have been directed toward increasing the receipts. During the next ten, their policy will be to diminish the working expenses, leaving the receipts to increase with the natural growth of the country, and avoiding unhealthy competition for that delusive phantom, "through-trade," which has lured so many railways to financial shipwreck and ruin. If this policy be steadily followed, we shall see railway stocks once more a favorite investment.