_Reviewing vanished practices, including ticket scalping and fast
freight lines._
When the Canadian Pacific Railway was built across the prairies there
was no railway for a hundred miles south of parallel forty-nine. Red
River carts, canoes and dog-sleds furnished all the transportation
between it and the North Pole. Van Horne earned his first freight
revenue from the Saskatchewan plains by shipping buffalo bones to
Eastern fertilizer manufacturers. When he stopped at construction
camps he would draw pictures on buffalo skulls for the men’s
amusement in the evening. To build a railway across empty plains and
over mountain ranges was regarded as unmitigable folly by many people
who believed themselves to be far-seeing.
While it was being done the state of Eastern Canada was not very
encouraging. Half of the settled farm land of Ontario was uncleared
bush. Farmers received little or nothing for their produce. The
cities were small. Manufacturing was in a sickly, uncertain infancy.
In average years the country was importing something more than a
hundred million dollars’ worth of goods and exporting something less.
The interest on borrowed money, therefore, was being paid with more
borrowed money. The revenue of the Dominion was about thirty million
dollars. You could get good board in Montreal or Toronto for four
dollars a week, and very good for six. Everybody was poor.
There isn’t the same sort of plenty in Canada that there was forty
years ago--I mean as to eats and drinks, the cost of fuel, and the
simplicities of fun. But, on the whole, things are vastly better than
they were. Those who discover a moral declension in the people are
sorely mistaken.
But I am concerned with railway affairs, and am not delivering
lectures on the history of Canadian morals. The railroad ethics of
to-day are very much ahead of the railway ethics of forty years ago.
That is true whether you compare railway standards with railway
standards, or look cursorily over the field of commercial and social
relationships. One wouldn’t say that saintliness distinguishes the
railway business more than it does any other. Indeed, it is commonly
supposed that there is more freedom of speech, running into license,
among knights of the rail than there is in any other walk of life.
It is still supposed by many otherwise excellent people that, of
all corporations, a railway corporation most assuredly has neither
body to be kicked, nor soul to be damned. Railwaymen are not a
perfectionist crowd. They never set themselves up for paragons. But
take them by and large, railwaymen are as worthy a segment of society
as any other. In the last forty years there has been at least as
notable a progression in the standards of railway behaviour as in
other fields of human activity, including the Christian ministry.
Heaven knows there was room for improvement--not in the men, but in
the standards which were considered appropriate to a business that
was always weirdly competitive, was sometimes wonderfully prosperous,
and at other times was woefully depressed. There is a changing
orthodoxy in commerce as there is in religion and politics. The
railway business is no exception to this rule. The change has been
steadily for the better. Of this it will be easy to convince the
elder, as I hope it will not be impossible to inform, the younger
readers of these remarks.
How far we have travelled, how large have been the revolutions in
commercial morality within the memory of people now living, can be
indicated by a few facts. I have mentioned a lady now in England who
has given sixty-five descendants to Canada. She was eight years old
when slavery became illegal in the British dominions. She was sixteen
years old when, under the Ashburton treaty which gave to the United
States territory that ought to have been part of Canada, the United
States and Britain agreed to maintain squadrons off the coast of
Africa to prevent further shipment of slaves to the New World. Scores
of thousands of the present citizens of the United States were born
as slaves. When I came to Montreal the American Civil War which freed
the slaves wasn’t as far back as the Boer War is now.
The old lady of whom I have spoken was six years old when the Reform
Bill put an end to the system of rotten boroughs in the British
Isles, which we still regard as having in all past centuries been
in the forefront of moral and political progress. The political
corruption of those times, so nauseating when we read about it, was
regarded as a matter of course by men and women who were godliest
among the good. Nowadays, when we are shocked by stories of buying
votes in elections, we sometimes forget the recency of the society
from which that form of bribery descends. Financial customs which are
reprehensible to-day were respectable not so long ago--in all walks
of life.
One mentions these things in a railway retrospect, so that when a
few facts as to old-time methods have been given it will not be
supposed that in their practices of several decades ago some railway
administrations were sinners above all other sinners. They practised
the orthodoxies of their times, and were neither better nor worse
than the practitioners of orthodoxy in a hundred ranges of human
activity.
It may seem a queer question to young people--What would you think,
supposing you wanted to go to Chicago on the Canadian National
Railways--and, instead of going into the railway office at King and
Yonge, and paying, say, sixteen dollars for the ticket, you slipped
into a private ticket office up street, and bought your ticket for
ten dollars? Or, supposing you were going to San Francisco, instead
of buying a through ticket to your destination at the Canadian
National or Canadian Pacific office downtown, or at the Union
Station, you bought a ticket only for Chicago, at the little office
up the street, and then, at Chicago, bought another for the rest
of the journey from another privately-conducted office, and saved
perhaps twenty-five dollars by doing that, instead of buying your
ticket at the railway office in Chicago?
In 1924 it sounds very odd to mention such possibilities to men and
women of thirty years of age, who suppose they really know something
of the world’s ways. But to older people the suggestion has all
the familiarity of reminiscence--it recalls the age of scalping in
passenger travel, and of the so-called fast freight lines in the
other branch of railway business, which were in full blast when I
began to audit accounts in the Grand Trunk head office at Point St.
Charles.
What is now told about our railways is not to their discredit,
except so far as it would be to the discredit, for instance, of the
Christian churches of to-day to remind them that it was not they
who directly raised the tone of political morality, or abolished
slavery. Canadian railway practice was like the railway practice of
other countries--mainly the United States. The Grand Trunk, with
its English management and English ideas, had some peculiarities
of its own; but, in the main, its relation to scalping and fast
freight lines was forced upon it by the prevailing conditions on
this continent. Those conditions could only be finally improved by
the intervention of public authority, such as the Dominion Board
of Railway Commissioners, or the Inter-State Commerce Commission,
both of which bodies may be only stages in the evolution towards
the public ownership of all railways, which, theoretically at least
(though practically it is not so easy of accomplishment), is as sound
as the public ownership of the postoffice, the navy, or the geodetic
survey.
In the old days, railways competed fiercely against one another,
and were virtually a law unto themselves. Tariffs were filed with
Governments; but they were as often honoured in the breach as in
the observance. The principle of the member of Parliament franking
letters for himself, his family, and his friends, which has been a
hoary accompaniment of the honesties of parliamentary government,
was in full operation in the railway field. Because you were
next a railway, you could get special privileges as naturally as
you could get special privileges in the mails if you were of a
Parliamentarian’s family. In politics you got a place with much
pay and little work if you were closely related to a minister. In
business you got better rates than your competitor if you were more
happily related to the management than he.
It would be too devious a chase just now to ascertain exactly how the
practice of scalping railway tickets came into vogue. At all events
it was in vogue in Montreal and Toronto in the early eighties--as
it was in the United States, its natural home. It was customary for
railways to sell to scalpers quantities of tickets over their own
systems at a reduced rate. There was always a bargain-counter for
the scalper. The scalpers sold tickets to customers at a profit,
which often depended on how the scalper sized up the customer when he
came to buy.
The scalper also bought tickets from individuals--mostly the unused
portions of return tickets. Return tickets were not as long-dated as
they now are. You came to Toronto from Chicago with a return ticket;
and found you could not go back within the time limit. You sold that
half of the ticket to the scalper for, say, two or three dollars,
and he took his chance of selling it, for, say, ten, to somebody who
wanted a single.
Telling this to an astonished friend the other day, he at once
asked how so singular a method of doing business affected the audit
offices. Well, as I wasn’t in a very responsible position at the
Grand Trunk, during the two and a half years I remained in Montreal;
(whence I moved to New York, in the spring of 1885) I do not profess
to speak of how things were straightened out in Montreal; but, from
knowledge gained, it can be said that there was a practice in many
railways on this continent of putting aside earnings reserves when
business was good, and using them when business was not so good. In a
way, it was as if a storekeeper neglected to count the accumulations
in his till, and then reckoned his count for the day when it was made.
The scalping practice made this manner of reporting receipts
inevitable. For example, a big block of tickets was sold outright to
a scalper--it might be at fifty, sixty or seventy per cent. of the
rate charged at the railway’s own counter. He paid for them. When
they came back to head office there was nothing to differentiate the
tickets sold to the scalpers and the tickets sold to the public. The
conductor couldn’t tell when he lifted a ticket that had been bought
from a scalper. He had to turn it in as part of his report.
Say there were a thousand tickets from Montreal to Chicago, and
the regular rate was thirty dollars, a total of thirty thousand
dollars. But the railway’s cash receipts were only twenty thousand
dollars, because of the scalping. The proportion of scalped revenue,
obviously, would vary from month to month. Adjustment was necessary;
and in making adjustments it is equally obvious that it would be a
convenience to even up from a reserve in hand, or to put part of an
exceptionally good run of receipts into the reserve.
For the benefit of the juvenile generation it may be added that
scalping became so large and pervasive an adjunct to transportation
that its interests developed an organization of their own. If you
wanted a through ticket to San Francisco, instead of taking chances
of making a good bargain at a scalper’s, between trains at Chicago,
the scalper in Toronto would do all the needful business for you.
He regarded himself as a broker, and to some he was a very present
help in time of trouble. That he was not necessary--assuming proper
relations between the railways and the public--is proved by his
elimination as soon as public control of railways arrived.
The anomaly of the fast freight line was another and more wonderful
manifestation of the vicious principle which was behind the scalping.
It also had its relation to two other transportation services which
still exist, though they are not as liable to the same abuses that
were inseparable from the fast freight lines--I mean the express
service and the Pullman car. The express business to California
was being done by ponies, for instance, before there was railway
communication across the mountains. When railways were built the
express companies brought their business to them, using cars, and
paying the railways a percentage of receipts for the entire service.
The Pullman car service was entirely a product of the railways. When
trains did not afford the luxury of sleeping between sheets, Mr.
Pullman came along, offered to furnish cars, collect tolls, and pay
the railways for hauling them. This method is just about as old as
the Canadian Confederation. One of the most curious sidelights on
the origin of what is regarded as an entirely American innovation
is furnished by the story of the Prince of Wales’ tour in Canada in
1860. The first car to carry sleeping accommodation was built at
Brantford for the Prince of Wales. From it Pullman got the ideas
which he evolved into the Pullman system.
Pullman built his cars, charged the railways a rental for them,
and himself took the special revenue earned by the sleeping
accommodation. He obtained practically a monopoly on this continent,
and the Grand Trunk remained like other roads, after the Canadian
Pacific and the Canadian Northern owned and operated their own
sleeping cars.
The practice of farming out certain services was the fruit of
conditions. It is virtually the same as was followed by Lord
Northcliffe in many of his secondary publications in London. He
farmed their advertising out to advertising agents. The railways
farmed out to express companies the swifter-than-freight carriage of
goods; and to the Pullman Company the night comfort of passengers.
But the fast freight line game was in a different category from these
present-day services. It was regarded as legitimate business then; if
a revival of it were attempted now it would be given another name.
It grew from the hoary notion that it was all right to give private
favours at the public expense. If a concern brought a large amount
of traffic, it got a better rate than its smaller competitor. That
notion of the proprieties opened the door to the fast freight line,
which wasn’t a railway at all, but an inside track which had no
honest business to be there.
A group of men who happened to be high-up railway officials organized
a company called, say, the Minnehaha Fast Freight Line. The company
got preferential rates on all the freight it turned in. The company
labeled its cars and went out after business. It charged the shipper
the same rates as the railways did, but promised him more rapid
delivery. The railways gave preference to the so-called fast freight,
though they got less revenue from it, pound for pound, than they
received from the freight they pushed aside for it.
The complications that arose from this favouring of fast freight
companies were many and were often amusing. On the Grand Trunk I
was soon told off for special auditing, and in 1884 was sent to
Detroit, with W. B. Pollock, of the New York, West Shore and Buffalo
Railway, to audit the books of an agent of a fast freight line who
had received more money than he accounted for, because of the system
of collecting payment from shippers. Incidentally, straightening out
the tangle led to my going into railway service across the line, and
almost made me an American.
On this continent there was so much distrust of railways by railways
that when a great business corporation sent, say, a trainload of
sugar from New York by a fast freight line, to be distributed to
different points in what was still regarded as the west--Ohio, for
instance--the money for the whole service would be paid to some
central agent of the fast freight line, who, in due time, paid their
proportions to the railways which received parts of the traffic.
Unraveling bookkeeping tangles was always a revel to me. Pollock and
I discovered that the fast freight line agent at Detroit was a good
many thousand dollars astray in his reckoning.
That piece of work procured for me the offer of a clerkship on the
West Shore line, which runs down the western side of the Hudson
river, and this involved a removal to New York.
After a year and a half, the West Shore was taken over by the New
York Central group, and the office force was transferred from the
old Stewart Building near Cortland street to the head office of the
bigger system in the Grand Central Station at Forty-second Street,
to make the necessary accounting adjustments. When this was finished
salaries were reduced. I thought the offer to me was beneath my
merits; and, having a promise that in pending changes on the Jersey
Central I would be sure of a position, I returned to Montreal to
await developments. They were much delayed, and, not loving idleness,
I did some special work for Mr. Hawson.
At last the offer from the Jersey Central came. It was a good offer,
which would probably have led to rapid promotion, for the man who
was to have been my chief soon after died, and according to all
custom I should have succeeded him as assistant auditor of freight
receipts. Of my colleagues in New York a considerable proportion
won high promotion--my fellow auditor of the Detroit fast freight
agent’s accounts, W. B. Pollock, is now the head of the whole marine
department of the New York Central lines.
When the offer did come I had just arrived at Portage la Prairie,
and had not begun work. I might have gone East again, had not Horace
Greeley’s advice been earnestly repeated to me, with results one sees
no reason seriously to regret. Anyway, it is no use speculating
on what would have become of my family if, instead of finding them
through a Portage la Prairie merchant’s house--my father-in-law had
the leading retail and wholesale store in the town--I had turned
again east, before the wide streets of the Manitoba town had become
familiar.
My sister had kindly kept from me a letter which would probably have
resulted in a life spent in producing Ceylon tea. Mr. Baker, my first
chief in the West, induced me to answer unfavourably a telegram which
almost certainly had within it the makings of an American citizen.
So, it would seem, does Providence sometimes steer our barque.