Chapter XII: Act 18: Geo. II., c. 33, provided, among {50}other things, that the streaks (9)

Opened in 1832, the Leicester and Swannington Railway restored to the Leicestershire colliery-owners the advantage in the Leicester market of which the canal companies had enabled their north-of-the-Trent competitors to deprive them for so many years; and it was now the turn of the Nottinghamshire and Derbyshire coalmasters to consider what they should do to meet the new situation which had arisen. They first had conferences with the directors of the Loughborough, Erewash and Leicester Navigations, and sought to induce them to grant such reductions in tolls as would enable them to compete with the Leicestershire coal, now that this was no longer shut out from Leicester by the dry ditch in Charnwood Forest. But the only concessions the canal companies would make were regarded as wholly inadequate by the Nottinghamshire coalmasters, who, meeting at a little inn at Eastwood, on August 16, 1832, resolved that "there remained no other plan for their adoption" than to lay a railway from their collieries to the town of Leicester. They formed a Midland Counties Railway Company, obtained an Act, built their line, and so laid the foundations of the great system now known to us as the Midland Railway. Into that system the Leicester and Swannington was absorbed in 1846.

The position to-day of the waterways which for thirty years controlled more or less the transport conditions of the three counties in question, brought great wealth to their owners, and, by their sole regard for their own interests, forced the traders to resort to railways, is shown by the Fourth or Final Report of the Royal Commission on Canals and Waterways. From this one may learn that the Loughborough and Leicester Navigations, which follow the course of the Soar, are liable to floods and are, also, sometimes short of water, in consequence of the want of control over the supply of water to mills; and although, with the Grand Junction Canal, they offer "the most direct inland water route" to London for the traffic of Derby, Nottingham and Leicester and of the large coal districts, they serve at present, adds the Report, but an insignificant part of the traffic which travels by this route.

{245}In effect, the very efforts made by the canal companies to preserve the monopoly they had so long and so profitably enjoyed were only a direct means of encouraging railway expansion; though few great institutions, destined to lead to a great social and economic revolution, have established their position in the face of more prejudice, greater difficulties, and less sympathetic support from "the powers that be" than was the case with the railways.

The traders of the country were naturally favourable to them, since the need for improved means of communication, following on the ever-expanding trade and industry of the land, was becoming almost daily more and more acute. But the vested interests, as represented alike by holders of canal shares, by turnpike road trustees and investors, and by the coaching interests, were against the railways; the Press of the country was to a great extent against them; leaders in the literary and the social worlds either ignored or condemned them; landowners first opposed and then blackmailed them; Governments sought to control and to tax rather than to assist them; and then, when the railways had proved that they were less objectionable than prejudiced critics had assumed, and were likely even to be a source of profitable investment, they were boomed by speculators into a popularity that led both to successive "railway manias" and to the whole railway system being still further burdened with an excessive capital expenditure which has been more or less to its prejudice ever since.

Some of the early denunciations by those who would have considered themselves, in their day, to be leaders of public opinion, if not of light and learning, afford interesting examples of the hostility which railways, in common with every innovation that seeks to alter established habits and customs, had to encounter.

In the article published in the "Quarterly Review" for March, 1825, in which proposals for making railways general throughout the country are condemned as "visionary schemes unworthy of notice," it is further said in reference to the Woolwich Railway:--

"It is certainly some consolation to those who are to be whirled at the rate of eighteen or twenty miles an hour, by means of a high pressure engine, to be told that they are in {246}no danger of being sea-sick while on shore, that they are not to be scalded to death, nor drowned by the bursting of the boiler; and that they need not fear being shot by the scattered fragments, or dashed in pieces by the flying off or the breaking of a wheel. But, with all these assurances we should as soon expect the people of Woolwich to suffer themselves to be fired off upon one of Congreve's ricochet rockets as trust themselves to the mercy of such a machine, going at such a rate. Their property they may, perhaps, trust; but while one of the finest navigable rivers in the world runs parallel to the proposed railroad, we consider the other twenty per cent which the subscribers are to receive for the conveyance of heavy goods almost as problematical as that to be derived from the passengers. We will back old Father Thames against the Woolwich Railway for any sum."

In "John Bull" for November 15, 1835, railways are spoken of as "new-fangled absurdities," and it is declared that "those people who judge by the success of the Manchester and Liverpool Railroad, and take it as a criterion for similar speculations, are dunces and blockheads." In the case of that particular railway, the writer argues, the distance was short, the passengers were numerous, the "thing" was new and the traffic was great--above all the distance was short; but it did not follow that railways were going to succeed elsewhere. He continues:--

"Does anybody mean to say that decent people, passengers who would use their own carriages, and are accustomed to their own comforts, would consent to be hurried along through the air upon a railroad, from which, had a lazy schoolboy left a marble, or a wicked one a stone, they would be pitched off their perilous track, into the valley beneath; or is it to be imagined that women, who may like the fun of being whirled away on a party of pleasure for an hour to see a sight, would endure the fatigue, and misery, and danger, not only to themselves, but their children and families, of being dragged through the air at the rate of twenty miles an hour, all their lives being at the mercy of a tin pipe, or a copper boiler, or the accidental dropping of a pebble on the line of way?

"We denounce the _mania_ as destructive of the country in a thousand particulars--the whole face of the Kingdom is to be tattooed with these odious deformities; huge mounds are {247}to intersect our beautiful valleys; the noise and stench of locomotive steam-engines are to disturb the quietude of the peasant, the farmer and the gentleman; and the roaring of bullocks, the bleating of sheep and the grunting of pigs to keep up one continual uproar through the night along the lines of these most dangerous and disfiguring abominations....

"Railroads ... will in their efforts to gain ground do incalculable mischief. If they succeed they will give an unnatural impetus to society, destroy all the relations which exist between man and man, overthrow all mercantile regulations, overturn the metropolitan markets, drain the provinces of all their resources, and create, at the peril of life, all sorts of confusion and distress. If they fail nothing will be left but the hideous memorials of public folly."

In "Gore's Liverpool Advertiser" for December 20, 1824, mention is made of some of the objections then being raised against railways, these being described as "exceedingly trifling and puerile." "Elderly gentlemen," it is said, "are of opinion that they shall not be able to cross the rail-roads without the certainty of being run over; young gentlemen are naturally fearful that the pleasant comforts and conveniencies of their foxes and pheasants may not have been sufficiently consulted. Ladies think that cows will not graze within view of locomotive engines, and that the sudden and formidable appearance of them may be attended with _premature_ consequences to bipeds as well as quadrupeds. Farmers are quite agreed that the race of horses must at once be extinguished, and that oats and hay will no longer be marketable produce."

Other alarmist stories were that a great and a scandalous attack was being made on private property; that there was not a field which would not be split up and divided; that springs would dry up, meadows become sterile and vegetation cease; that cows would give no milk, horses become extinct, agricultural operations be suspended, and houses be crushed by the railway embankments; that ruin would fall alike on landowners, farmers, market gardeners and innkeepers; that manufacturers' stocks would be destroyed by sparks from the locomotives; that hundreds of thousands of people, including those who had invested in canals, would be beggared in the interests of a few; and that (as an anti-climax to all {248}these predictions of national disaster) the locomotive, after all, would never be got to work because, although its wheels might turn, it would remain on the lines by reason of its own weight--a theory which, long pondered over by men of science, led to early projects of "general" railways being based on the rack-and-pinion principle of operation, and was only abandoned when someone had the happy idea of making experiments which proved that the surmise in question was a complete delusion.

I reproduce these puerilities of the early part of the nineteenth century, not simply for the entertainment of the reader, but because it is a matter of serious consideration how far they affected the cost of providing the country with railways. and whether, indeed, the traders who smile at them to-day may not still be paying, in one way or another, for the consequences they involved.

The keener the prejudice, the greater the hostility and the more bitter the denunciations when railways were struggling into existence, the more vigorous became the antagonism of landowners, the higher were the prices demanded for land, the more costly, by reason of the opposition, were the proceedings before Parliamentary Committees, and the heavier grew that capital expenditure the interest on which would have to be met out of such rates and charges as the railways, when made, would impose.

To a certain extent one may sympathise with landowners who feared that the amenities of their estates might be prejudiced by an innovation of which so much evil was being said; but, as a rule (to which there were some very honourable exceptions) it was found that their scruples in regard alike to their own interests and to the national welfare eventually resolved themselves into a question of how much money could be got out of the companies. Thus the extortionate prices paid for land often had no relation to the actual value of the land itself. They were simply the highest amount the railway company were prepared to pay the landowner for the withdrawal of his threatened opposition. If the company resisted the exorbitant demands made upon them, and would not give a sufficiently high bribe, they were so strongly opposed that they generally lost their Bill when they first applied for it to Parliament. Thereupon they would {249}yield, or effect a compromise on, the terms asked for, announce that they had made amicable arrangements with the opposition, re-introduce their Bill in the following Session, and then succeed in getting it passed.

It might happen, even then, that the companies obtained their powers subject only to a variety of hampering or vexatious restrictions which the landed gentry or others were able to enforce in order that due respect should be shown to their fears or their prejudices. In some of the earlier railway Acts the companies were forbidden to use any "locomotives or moveable engines" without the written consent of the owners or occupiers of the land through which their lines passed. One of the clauses of the Liverpool and Manchester Act provided that "no steam engine shall be set up in the township of Burtonwood or Winwick, and no locomotive shall be allowed to pass along the line within those townships which shall be considered by Thomas Lord Lilford or by the Rector of Winwick to be a nuisance or annoyance to them from the noise or smoke thereof." The same two individuals secured insertion of a clause in the Warrington and Newton Railway Act to the effect that every locomotive used within the parishes mentioned should be "constructed on best principles for enabling it to consume its own smoke and preventing noise in the machinery or motion thereof," and should use "no coal, but only coke or other such fuel" as his lordship and the rector might approve.

The story of the London and Birmingham Railway is especially significant of the general conditions under which the English railway system came into being.

Industrial expansion had brought about great developments in the Birmingham and Black Country districts, the population in Birmingham alone having increased from about 50,000 in 1751 to 110,000 in 1830. Wide possibilities of increasing trade and commerce were being opened up, but these were seriously hampered by the disadvantages experienced in the matter of transport. Small parcels of manufactured goods could be sent by coach, and a good deal of wrought iron--in small quantities per coach--was also distributed in the same way during the course of the year. For bulky goods or raw materials the only means of transport between Birmingham and London was by canal, and this meant a three-days' {250}journey. Over 1000 tons a week were then going from Birmingham to London by water; but there was great need for a means of communication at once more speedy and more trustworthy. Goods were delayed in transit even beyond the three days; they were rejected by the shippers because they did not arrive in proper time; they were sometimes held up by frost on the canal between Birmingham and London and lost their chance of getting to the Baltic before the spring; while, alternatively, they might be pilfered or lost on the canal journey, and so not get even as far as London. There was often much difficulty, also, in obtaining raw materials.

In the result manufacturers had to refuse orders because they could not execute them in time, and the local industries were not making anything like the advance of which, with better transport facilities, they would have been capable. The business that Birmingham manufacturers should have been doing with Italy, with Spain, or with Portugal was found to be drifting more and more into the hands of Continental competitors who had greater advantages both in obtaining raw materials on the spot and in distributing their manufactured goods. It was further argued that in view of the struggle then proceeding between this country and Continental countries for commercial supremacy, the improvement of the means of transport, even as regarded Birmingham and London, was a matter of national, and not simply of local, concern.

It might well be assumed that such considerations as these would have appealed to the patriotic instincts of the English people, and especially to those of the landed gentry. Yet the issue, in January, 1832, of the first prospectus of the London and Birmingham Railway Company, and the introduction of their Bill in February of the same year, led to opposition, to extortion and to actual blackmail of the most determined and most merciless description.

The Bill passed in the Commons, but it was thrown out in the Lords. Its rejection there was attributed to the landowners, who, it was declared, had "tried to smother the company by the high price they demanded for their property." The inevitable negotiations followed. Six months after the defeat of the Bill the directors announced that the {251}"measures" they had taken with a view to removing "that opposition of dissentient landowners and proprietors which was the sole cause of their failure ... had been successful to a greater extent than they had ventured to anticipate. The most active and formidable had been conciliated," and the Bill would be introduced afresh in the following Session. This was done, and the Bill became an Act, receiving the Royal assent on May 6, 1833.

The nature of the "measures" which had succeeded in overcoming the opposition may be judged from some facts mentioned by John Francis, who says that land estimated in value at £250,000 cost the company three times that amount. One landowner, in addition to getting £3000 for a certain plot, extorted £10,000 for what he called "consequential damages"; though, instead of injuring the remainder of his property, the line increased its value by twenty per cent. For land used only as agricultural holdings the company is said to have had to pay at the rate of £350 an acre.

But this was not all. There was the opposition of towns as well as the greed of individuals to be taken into account. According to Robert Stephenson's original survey, the London and Birmingham Railway was to pass through Northampton, where, also, it was proposed to establish the company's locomotive and carriage works. The opposition in Northampton, however, was so great that in order to meet it the company altered their plans and arranged for the line to pass at a distance from that town. They further undertook to start their locomotive works at Wolverton, and thus not interfere with the amenities of Northampton.

How much the town and trade of Northampton lost as the result of its scruples could hardly be told; but the consequences to the railway company of this enforced alteration of route were as serious as any of the extortions practised by the landowners. The line had now to pass through a tunnel at Kilsby, five miles distant from Northampton, and a contractor undertook to cut this tunnel for £90,000. But, while engaged on the task, he came upon a quicksand which reduced him to despair and led to his throwing up the contract. Robert Stephenson thereupon took the work in hand and he had to have 1250 men, 200 horses and thirteen steam-engines at work raising 1800 gallons of water per minute night and day {252}for the greater part of eight months before the difficulty was overcome. By the time the tunnel was completed the cost of construction had risen from the original estimate of £90,000 to over £300,000, this enormous expenditure having been incurred, not because it was necessary for the line, as first designed, but to meet the opposition and spare the feelings of the then short-sighted dwellers in the town of Northampton.

The London and Birmingham Railway, with its terminus at Euston, was eventually opened for traffic throughout in September, 1838. It was, of course, one of the lines subsequently amalgamated to form the London and North-Western Railway.

The first Bill of the Great Western Railway, applied for in 1834, was strenuously opposed and defeated. The second Bill, brought forward in the following session, was less strenuously opposed, and was duly passed. In the interval the opposition of the dissentient landowners had been "conciliated"; and, commenting thereon (in 1851), John Francis says:--

"The mode by which the opposition of landholders was met bears the same sad character as with other railways. Every passenger who goes by the Great Western pays an additional fare to meet the interest on this most unjust charge; and every shareholder in this, as in other lines, receives a less dividend than he is entitled to from the same cause. Nor does the blame rest with the conductors of the railway. They were the agents of the shareholders and were bound to forward their interests. The principle of the case to them was nothing. They were bound to get the Act at the cheapest possible rate, and if the law gave their rich opponents the power of practically stopping the progress of the line, and those opponents chose to avail themselves of the law, the shame rests with the proprietor of the soil, and not with the promoter of the railway. Fancy prices were given for fancy prospects, in proportion to the power of the landowner. Noblemen were persuaded to allow their castles to be desecrated for a consideration. There can be no doubt--it was, indeed, all but demonstrated--that offers were made to and accepted by influential parties to withdraw their opposition to a Bill which they had declared would ruin them, while the smaller and more numerous complainants were {253}paid such prices as should actually buy off a series of long and tedious litigants."

The promoters of that most unfortunate of lines, the Eastern Counties--predecessor of the Great Eastern Railway of to-day--found themselves faced with serious opposition in the Lords after they had got their Bill through the Commons; "but," says the first report, "the directors, by meeting the parties with the same promptness and in the same fair spirit which had carried them successfully through their previous negotiations, effected amicable arrangements with them," and the company was incorporated in 1836. The negotiations must, however, have been carried through with greater promptness than discretion, for, to save the fate of their Bill, the directors undertook to pay one influential landowner £120,000 for some purely agricultural land which was said to be then worth not more than £5000. After they had secured their Bill they made persistent attempts to get out of paying the £120,000; and, altogether, they so shocked John Herapath that in successive monthly issues of his "Railway Magazine" all references to the Eastern Counties Railway Company were encircled by a black border.

In another instance a company proposed to meet the opposition of certain landowners by carrying the line through a tunnel, which would enable them to avoid the property in question. The tunnel would have cost £50,000, and the landowners said, "Give us the price of that tunnel and we will withdraw our opposition." The company offered £30,000, and the landowners agreed to be "conciliated" on this basis. They still came off better than the objector who began by demanding £8000 and finally accepted £80. John Francis, too, relates the following story: "The estate of a nobleman was near a proposed line. He was proud of his park and great was his resentment. In vain was it proved that the new road would not come within six miles of his house, that the highway lay between, that a tunnel would hide the inelegance. He resisted all overture on the plea of his feelings, until £30,000 was offered. The route was, however, afterwards changed. A new line was marked out which would not even approach his domain; and, enraged at the prospect of losing the £30,000, he resisted it as strenuously as the other."

There were some honourable exceptions to the general {254}tendency to extort as much as possible from the railway companies. Among these may be mentioned the voluntary return by the Duke of Bedford of a sum of £150,000 paid to him as compensation, his Grace explaining that the railway had benefitted instead of injuring his property; and by Lord Taunton of £15,000 out of £35,000 because his property had not suffered so much as had been anticipated. Exceptions such as these do not, however, alter the fact that, as stated by Francis in 1851, the London and Birmingham Company had had to pay for land and compensation an average of £6300 per mile, the Great Western £6696, the London and South Western £4000 and the Brighton Company £8000 per mile.

One argument, at least, which can be advanced in favour of State railways--as applying, however, to a country beginning the creation of a railway system, or building new railways, rather than to one taking over an existing system--is that extortions in respect to land could not be practised on the State in the same way as they have been practised on English railway companies left by their Government to make the best terms they could with those who were in a position to drive the hardest of bargains with them. In Prussia, for example, the securing of land for any new lines wanted for the State railway system is a comparatively simple matter. If the landowner and the responsible officials cannot agree to terms, the matter is referred to arbitration, though with every probability that the landowner will get no more than a fair sum, and will not be able to extort fancy figures under the head of consequential damages or as the "price" of his withdrawing any opposition he might otherwise offer.

Apart from other considerations, and taking only the one item of land, the State lines of Continental countries may well have cost less to construct than the English lines, while both in the United States and in Canada the pioneer railway companies had great stretches of land given to them, by State or Federal Government, not alone for their lines, but as a further means of assisting them financially.

When one finds how the cost of creating the railway system in our own country was swollen, under the conditions here stated, to far greater proportions than should have been the case, and when one remembers that the excessive capital {255}expenditure involved in meeting extortionate demands had either to remain unremunerative or be made good out of the payments of travellers and traders, it is evident that comparisons between English and foreign railway rates and fares may be carried to unreasonable lengths if they ignore conditions of origin by which the operation of the lines concerned must necessarily have been more or less influenced. Francis himself says on this point, while confessing that "every line in England has cost more than it ought":--

"The reader may learn to moderate his intense indignation when, anathematising railways, he remembers with what unjust demands and impure claims they had to deal, and with what sad and selfish treatment it was their lot to meet. They owe nothing to the country; they owe nothing to the aristocracy. They were wronged by the former; they were contumaciously treated by the latter."

Another factor, apart from cost of land, in swelling the construction capital of British railways to abnormal proportions has been the cost of Parliamentary proceedings; and here, again, State railways have had the advantage. In Prussia the obtaining of sanction for the building of an additional line by the State railways administration is little more than a matter of official routine; whereas in England the expenses incurred by railway companies in obtaining their Acts have often amounted to a prodigious sum--to be added, of course, to the capital outlay which the users of the railway will be expected to recoup, or, at least, to pay interest on.

An especially striking example was that of the Blackwall Railway, now leased to the Great Eastern Railway Company. The cost of obtaining the Act for this line, which is only five miles and a quarter in length, worked out at no less a sum than £14,414 per mile, the total cost being thus £75,673. The amounts paid by certain other companies in securing their Parliamentary powers are given as follows by G. R. Porter in his "Progress of the Nation" (1846):--

Birmingham and Gloucester £22,618
Bristol and Gloucester £25,589
Bristol and Exeter £18,592
Eastern Counties £39,171
Great Western £89,197
Great North of England £20,526 {256}
Grand Junction £22,757
Glasgow, Paisley and Greenock £23,481
London and Birmingham £72,868
London and South Western £41,467
Manchester and Leeds £49,166
Midland Counties £28,776
North Midland £41,349
Northern and Eastern £74,166
Sheffield, Ashton-under-Lyne and Manchester £31,473
South-Eastern £82,292

In some cases, Porter explains, the sums here given contain the expenses of surveying and other disbursements which necessarily precede the obtaining of an Act of incorporation. On the other hand, they include only the costs defrayed by the proprietors of the railway, and not the expenses incurred by parties opposing the Bills. Nor do they include the expenses incurred in connection either with rival schemes or with schemes that failed altogether; though, in these instances, of course, there would be no chance of recouping the outlay out of rates and fares. No fewer than five different companies, for instance, sought for powers to construct a line from London to Brighton, and the amounts they expended are given by John Francis as follows:--

Rennie's line £72,000
Stephenson's £53,750
Cundy's £16,500
Gibb's £26,325
South-Eastern £25,000
-------
Total £193,575

Another company, the name of which is not given by Francis, had so vigorous a fight that they spent nearly £500,000 before they got their Act; but still worse than this was the fate of the Stone and Rugby Railway, whose promoters spent £146,000 on attempts made in two successive sessions to get an Act (the Committee on the first Bill sitting {257}on 66 days) and then failed. In another instance the promoters expended £100,000 with a like result.

After the early companies had got their Acts and obtained their land they still, as railway pioneers, had to bear the expense of some very costly experiments, of which railways constructed at a later date had the advantage. The idea that the locomotive would be able to haul trains only on the level involved much unnecessary expenditure on engineering works, while the battle of the gauges led to a prodigious waste of money alike in Parliamentary proceedings and in the provision of lines, embankments, cuttings, bridges and viaducts adapted to a broad gauge eventually abandoned in favour of the narrower gauges now in general use.

The facts here mentioned will have given the reader some idea of the conditions under which the railways so greatly needed in the interests of our national industries were handicapped from the very outset by an unduly heavy expenditure; but there were still other influences and considerations which materially affected the general position, more especially as regards questions and consequences of State policy towards the railway system in general.

{258}CHAPTER XXI

RAILWAYS AND THE STATE

From the earliest moment of there being any prospect of railways, operated by locomotives in place of animal power, coming into general use, the attitude of the State towards their promoters was one less of sympathy than of distrust; and this distrust was directly due to the experience the country had already had of the waterway interests, whose merciless exactions and huge dividends had led to the fear that if the railway companies, in turn, were to get a monopoly of the transport facilities of the country, they might follow in the footsteps of the inland navigation companies unless they were restrained either by law or by the enforcement of the principle of competition.

Public sentiment, which Parliament is assumed to represent, and of which our legislation is supposed to be the outcome, was divided between, on the one hand, the landed gentry, the canal proprietors (each alike hostile to the railways until they found they had more to hope for from exploiting them), and the inevitable opponents of innovations of any kind; and, on the other hand, the traders, by whom the railways were being cordially welcomed, not only because of the greater and better transport facilities they offered, but also because they presented an alternative to the canals, the earlier enthusiasm for which had been greatly moderated by the prospect of an improved means of transport.

Without adopting wholeheartedly the views of either of these two opposing parties, Parliament regarded the position with much concern lest there might be a renewal, in another form, of what we have seen to be the grasping tendencies of monopolistic canal companies; and the distrust inspired, under these particular circumstances, and from the very outset, towards railway companies which were preparing to create a revolution in the transport conditions of the {259}country--a revolution the State was not itself disposed to effect or to finance--was powerfully to influence much of the subsequent railway legislation, if, indeed, it has even to-day entirely disappeared.

At first it was assumed that competition in rail transport would be assured, and the dangers in question proportionately reduced, by different carriers using their own locomotives, coaches and carriages on the railway lines, which alone, it was thought, would be owned by the railway companies constructing them. In some of the earlier railway Acts there was even a provision that the railway companies could lease their tolls, as turnpike trustees were doing. But the apparent safeguard in the form of competition between rival carriers disappeared when it was found (1) that, although a railway company was required to allow a trader's own horse or locomotive to use the line, it was under no obligation to afford him access to stations and watering-places, or to provide him with any other facilities, however indispensable these might be to the carrier's business; (2) that the tolls charged by the railway companies were heavier than the carriers could afford to pay; (3) that the entire operation of a line of railway worked by locomotives must necessarily be under the control of the owning and responsible company; and (4) that railway companies would have to become carriers of goods as well as owners of rails.

A Parliamentary Committee which sat in 1840, and of which Sir Robert Peel was a member, had reported in the strongest terms that the form of competition originally designed was both impracticable and undesirable, and that monopoly upon the same line, at all events as regarded passengers, must be looked upon as inevitable. "Your Committee," said the report, "deems it indispensable both for the safety and convenience of the public, that as far as locomotive powers are concerned, the rivalry of competing parties on the same line should be prohibited"; though, as some check to the consequent monopoly of the railway companies, they suggested that the Board of Trade should act as a supervising authority, with power to hear complaints, consider bye-laws, etc.

A witness for the Grand Junction Railway Company, who gave evidence before this Committee, said that any person {260}might run his own engine on the Grand Junction, and in one instance this was done by a trader who had a locomotive on the company's line for drawing his own coal; but the witness apprehended the greatest possible inconvenience from any general resort to such powers. On the Liverpool and Manchester, also, anyone might run his own engines on the line; but, the witness added, "no one does."

The Royal Commission of 1865 summed up the position thus:--"No sooner were railways worked on a large scale with locomotive power than it was found impracticable for the general public to use the line with carriages and engines, and railway companies were compelled to embark in the business of common carriers on their own line, and conduct the whole operations."

When, in these circumstances, it was made certain that any idea of competition between carriers using a railway company's lines in the same manner as an ordinary highway would have to be abandoned, it became the established policy of the State to promote competition between the railway companies themselves by encouraging the construction of competitive lines or otherwise, thus still protecting, as was thought, the interests of railway users, and checking any monopolistic tendencies on the part of the railway companies. The futility, however, of seeking to compel railway companies to compete with one another had already been pointed out by Mr James Morrison, whose speech on the subject in the House of Commons on May 17, 1836, confirms, also, the theory I have suggested as to the attitude adopted towards the railway companies being traceable to fears engendered by the undue prosperity of the canal and navigation companies.

If, argued Morrison, after one company had spent a large sum on a line to Liverpool, another company were encouraged to spend as much again, with a view to providing a competition which would keep down the charges, the two would inevitably arrive at some understanding by which the original charges would be confirmed; and the Legislature, he contended--though the Legislature never acted on his contention--was "bound to prevent, as far as it could, the unnecessary waste of capital" on the building of unnecessary lines to promote a competition he held to be futile. The safeguarding of the public interests could, he thought, be effected in another way. {261}"The history of the existing canals, waterworks, etc., afforded," he went on, "abundant evidence of the evils" of allowing too much freedom in the matter of rates; and he quoted the high prices at which the shares of the Loughborough Canal and the Trent and Mersey Canal were then still being sold,[40] adding: "The possession of the best, or, it may be, the only practicable line, and the vast capital required for the formation of new canals, have enabled the associations in question, unchecked by competition, to maintain rates of charges which have realised enormous profits for a long series of years."

The remedy he recommended in preference to competition was that when Parliament established companies for the formation of canals or railroads it should invariably reserve to itself the power to make such periodical revisions of the rates and charges as it might deem expedient, examining into the whole management and affairs of each company, and fixing the rates and charges for another term; the period he favoured being one of twenty years.[41]

There was no suggestion, at this time, that the railway companies _had_ abused their powers. The only suggestion--and expectation--was that _because_ the canal companies had abused theirs, the railway companies might, and doubtless would, do the same, unless they were prevented; and it will {262}be found that this was mainly the position throughout the whole of the subsequent controversies.

Morrison's proposal was approved in the House of Commons, and on May 17 he brought in a Bill for giving effect to it in regard to all new railways, to be sanctioned in that or any subsequent Session. But the prospect of a Parliamentary limitation of the profits a railway might earn had a most depressing effect on the railway interests, and on July 11 Sir Robert Peel urged that the question should be decided without further delay inasmuch as "this branch of commercial enterprise was injured and almost paralysed." On the following day the Bill was brought up again, and it was then defeated.

In the same Session (1836) the Duke of Wellington moved, and carried, in the House of Lords a general clause, to be inserted in all railway Acts, the effect of which would have been to give to Parliament the power of dealing as it might think fit with any railway company during the next year. John Herapath thereupon inserted in the current issue of his "Railway Magazine" a letter addressed to the Duke of Wellington, in the course of which he said:--

"No person can doubt your Grace's intentions are honourable to all parties. Fearful of the consequences of overgrown monopolies, you are anxious to put some salutary restrictions to those bodies riding, as you apprehend, rough-shod over the public; and you are anxious to do this before they become too powerful to be ruled. Every honest and right-minded man must be satisfied that such are needful; nor is there a company got up on honourable principles that would object to any reasonable measure, in which a due regard is paid to their own interests, and a proper consideration is had to all the circumstances of their situation and risk. But in common fairness these must be taken into account."

Defending the railways, and keenly criticising the attitude of the State towards them, Herapath further said:--

"No man knows better than yourself that these works, if they are at all likely to be beneficial to the nation--which everyone in his sober senses admits--will form a great and brilliant era in its prosperity. Nay, my Lord Duke, permit me to ask you if they have not been a Godsend towards the preservation of this country, by giving a new impetus to {263}industry and trade, and saving us from that anarchy and confusion to which distress was fast hurrying a large proportion of our population? With all these advantages staring us in the face, what have the Government done to promote railways? Have they done a single thing? I am not conscious of one. Have they removed a single impediment? Not to my knowledge; but they have raised several. Have they contributed a single farthing? Rather, I believe, by the intolerable and vexatious oppositions permitted in passing the bills, have been the cause of spending many hundred thousands, which, like another national debt, will prey to the end of time on the vitals of public industry."

The Duke's proposed clause was dropped, and was heard of no more; but Herapath's prediction as to the equivalent of "another national debt" being imposed on public industry was to be verified by the course of subsequent events still more than by any avoidable expenditure then already incurred.

If, again, as Herapath said, the Government had done nothing to promote railways, they had not been backward in seeking advantage from them in the interests both of the Exchequer and of the Post Office.

Within two years of the opening of the Liverpool and Manchester line, a tax of one-eighth of a penny per mile for every passenger conveyed on the railway was imposed, and the directors of the Liverpool and Manchester, then struggling into existence, announced that, in consequence of the tax, they would be obliged to charge the public higher fares. By 1840 the Exchequer receipts from the tax amounted to £112,000. Two years later, following on a great public agitation, Peel substituted for the mileage tax a tax of five per cent on receipts from passenger traffic, and in 1844 the tax (which had been especially oppressive on the poorer class of travellers) was abolished in the case of third-class passengers carried at fares not exceeding a penny a mile in "Parliamentary trains," stopping at every station.[42]

The local authorities, with Parliamentary sanction, also subjected the railways to a degree of taxation against which {264}Mr G. C. Glynn, chairman of the London and Birmingham Railway, in a speech (at a meeting of his company) quoted by Francis, protested in the following terms: "Then comes the last item of local taxes and parochial rates; these, gentlemen, we do take exception to.... The county assessors and the parties to whom appeal from them is made seem actuated by one principle, namely, to extract every farthing they can from the railway property. We ask no boon, we ask for no favour from Government on this subject; but we do ask for justice."

The railways had to submit to the taxation, but they won the day as against certain excessive and, as they considered, intolerable demands made upon them by or on behalf of the Post Office.

In 1838, based on the recommendations of a Select Committee of the House of Commons on the transmission of mails by railway, the Government introduced a Bill which, in effect, placed the entire railway system of the country, then and for all future time, at the command and under the supreme control of the Postmaster-General. That functionary was empowered by the Bill to call upon the railway companies to provide him with--at their own cost--special or ordinary trains for carrying the mails at any hour of the day or night, proceeding at such speed, and calling or not calling at such places, as he might direct, the companies giving security to the Queen by bond for duly complying with all Post Office orders, and being made liable to a penalty of £20 in respect to every railway officer, servant or agent, who might disobey any Post Office order. If the Post Office wished to use its own engines and conveyances it was to be at liberty to do so without paying any rates or tolls whatever; and it was, also, to be free to clear away any obstructions to its engines, and use any of the railway company's appliances it wanted. The railway companies were, in return, to be assured a "fair remuneration" for (in effect) the wear and tear of the rails; but, lest this payment might be too much for the Post Office, the Postmaster-General was further authorised to recoup himself by carrying, not simply the mails, but _passengers_, in the trains he might think fit to command or to run, thus competing on the railway lines with the companies whose property he was virtually to annex.

{265}The companies declared they were willing to render every reasonable facility to the Post Office; but they protested most vigorously against what they called "the absurd and tyrannical clauses" of the Bill.

These were, nevertheless, defended in the Commons on behalf of the Government, the Attorney-General saying "he had no doubt if the prerogative of the Crown were put in force, the Post Office and the troops and stores might be transmitted along the railroads without the payment of any tolls whatever; though he thought the companies should have a fair remuneration for the accommodation given."

Sir James Graham, on the other hand, wanted to know what were the Queen's rights on the Paddington Canal. He understood that troops were frequently moved from Paddington to Liverpool by canal, but were always paid for as passengers. Lord Sandon, too, declared that the question was whether the public interest conferred a right upon the Post Office to take possession of railroads, and make use of them without the slightest remuneration whatever. That the railways should be subject to control he readily admitted; but there was a wide difference between justifiable control and absolute sway, between fair remuneration and robbery, for such it would be to use the property of these companies without paying for it.

The companies, according to a statement in the "Railway Magazine" for August, 1838, where a summary of the debate will be found, had been "prepared not merely to petition but to act"--whatever this may mean. The Government, however, adopted a more conciliatory attitude towards them by either withdrawing or amending the clauses which had evoked these protests, and an amicable settlement of the future relations between the railways and the Post Office was then effected.

The rejection of Morrison's Bill and the withdrawal of the Duke of Wellington's motion, following on their adverse criticism by the railway interests, had committed the Government still more to their policy of stimulating competition between the railway companies themselves, thus, they considered, diminishing the risk of seeing any of them become too prosperous a monopoly. It was in full accord with this policy that encouragement was given to the creation of {266}many small, independent, and more or less competing lines, and that no attempt was made to encourage the provision, either by individual companies or by groups of companies, of "trunk lines" of the type which Thomas Gray and others had been urging on the country with so much though with such futile persistence.

The advent of the new means of transport was, in fact, marked by the complete absence of any centralised effort with a view to securing the network of a railway _system_, so planned or so co-ordinated as to make the best possible provision for the country as a whole, and especially for the rapidly increasing necessities of trade, commerce and industry. The failure to act on these lines was, however, only in accordance with the previous policy, or no-policy, which had successively left the improvement of rivers, the making of roads, the construction of canals and the provision of turnpikes either to private benevolence or to private enterprise, influenced mainly by considerations of local or personal interests.

Much had certainly been done in these various directions by those to whom the State had thus relegated the carrying out of public works which in most other countries--as regards main routes, at least--are regarded as a matter of national obligation. But, apart from any question of providing State funds, the lack even of intelligent direction and efficient supervision by a central power, qualified to advise or to organise private effort, had led both to a prodigious waste of money and to results either unsatisfactory in themselves or in no way commensurate with the expenditure incurred. The same conditions now were to lead, in regard to the railways, to a further waste of money, to disastrous speculation, to infinite confusion, to the piling up of a huge railway debt, and to the provision of innumerable small lines which were to remain more or less independent and disconnected _fragments_ of a railway system until the more enterprising companies began, on their own initiative, to amalgamate them into through routes of traffic.[43]

The general position at the period here in question was well stated by G. R. Porter in his "Progress of the Nation" {267}(1846), where he wrote, on the subject of railway development:--

"The _laissez faire_ system which is pursued in this country to such an extent that it has become an axiom with the Government to undertake nothing and to interfere with nothing which can be accomplished by individual enterprise, or by the associated means of private parties has been pregnant with great loss and inconvenience to the country in carrying forward the railway system. Perhaps there never was an occasion in which the Government could with equal propriety have interfered to reconcile the conflicting interests involved, and to prevent public injury arising from the false steps so likely to be made at first in bringing about a total revolution in the internal communication of the country. It is not meant by these remarks to infer that Government should have taken into its own hands the construction of all or any of the railroads called for by the wants of the community; but only to suggest the propriety and advantage that must have resulted from a preliminary inquiry, made by competent and uninterested professional men with a view to ascertain the comparative advantages and facilities offered by different lines for the accomplishment of the object in view. If this course had been adopted before any of the numerous projects were brought forward for the construction of lines of railway between all imaginable places, and if it had been laid down as a rule by the legislature that no such projected line could be sanctioned or even entertained by Parliament which was not in accordance with the reports and recommendations of the Government engineers, the saving of money would have been immense. The expensive contests between rival companies in which large capitals had been so needlessly sunk would then have been wholly avoided; and it might further have followed from this cause that, a kind of public sanction having been given to particular lines and localities, much of that personal opposition which has thrown difficulties in the way of works of great and acknowledged utility would never have been brought forward."

In making these remarks, Porter was only giving expression to views entertained in various influential quarters, and to a certain extent he did but anticipate, or re-echo, according to the precise date at which his observations had been {268}written, certain views and proposals put forward by the Select Committee of 1844, of which Mr Gladstone (then President of the Board of Trade) was chairman. In the Fifth Report of this Committee it is said:--

"The Committee entertain very strongly the opinion that in the future proceedings of Parliament railway schemes ought not to be regarded as merely projects of local improvement, but that each new line should be viewed as a member of a great system of communication, binding together the various districts of the country with a closeness and intimacy of relation in many respects heretofore unknown."

So long, the Report continued, as railways were considered to be of problematical benefit, and were in general subject to extensive opposition on the part of the owners and occupiers of land, and of the inhabitants of the districts they traversed, there might have been reasons for ensuring a very full, and, in some points of view, a disproportionately full, representation to local interests; but "The considerations which tend to attach to railways a national rather than a local character gain weight from year to year as those undertakings are progressively consolidated among themselves, as the points of contact between them are multiplied, and as those that were first isolated in comparison are thus brought into relation with gradually extending ranges of space, traffic and population."

The Select Committee went on to give their reasons for considering that the ordinary machinery of Private Bill Committees, with their separate and unconnected proceedings, and an individual existence commencing and ending with each particular Bill, was inadequate and unsatisfactory; and they especially pointed to the fact that hitherto it had not been customary to examine railway Bills "systematically and at large with reference to public interests." There were various questions which could not be thoroughly sifted under the mode of procedure then in vogue, and the Committee recommended that, with a view to assisting the judgment of the Houses of the Legislature, all future railway Bills should, previously to coming before Parliament, be submitted to the Board of Trade for their report thereon. They further said--and these observations have a special significance in view of events that were to follow:--