The present system under which the Government employs railroads to
carry the mails was established in 1873, thirty-seven years ago. Under
this system, the Post Office Department designates between what named
towns upon each railroad in the country a so-called "mail route" shall
be established. Congress prescribes a scale of rates for payment per
mile of such mail route per year, based upon the average weight of
mails transported over the route daily, "with due frequency and
speed," and under "regulations" promulgated from time to time by the
Post Office Department. To this is added a certain allowance for the
haulage and use of post office cars built and run exclusively for the
mails, based upon their length. The annual rate of expenditure to all
railroads for mail service on all routes in operation June 30, 1909,
was $44,885,395.29 for weight of mail, and for post office cars
$4,721,044.87, the "car pay," so-called, being nine and five-tenths
per cent of the total pay. The payment by weight is, therefore, the
real basis of the compensation to railroads. The rate itself, however,
varies upon different mail routes to a degree that is neither
scientific nor entirely reasonable. The rate per ton or per hundred
pounds upon a route carrying a small weight is twenty times greater
than is paid over a route carrying the heaviest weight. The Government
thus appropriates to its own advantage an extreme application of the
wholesale principle and demands a low rate for large shipments, which
principle it denounces as unjust discrimination if practiced in favor
of private shippers by wholesale. The effect of the application of
this principle has been to greatly reduce the average mail rate year
by year as the business increases. This constant rate reduction was
described by Hon. Wm. H. Moody (now Mr. Justice Moody of the United
States Supreme Court) in his separate report as a member of the
Wolcott Commission in the following language:
"The existing law prescribing railway mail pay automatically
lowers the rate on any given route as the volume of traffic
increases. Mr. Adams shows that by the normal effect of this law
the rate per ton mile is $1.17, when the average daily weight of
mail is 200 pounds, and, decreasing with the increase of volume,
it becomes 6.073 cents when the average daily weight is 300,000
pounds."
NOTE.--Since 1907 the railroads have been paid at much reduced rates.
On the heavy routes the pay is now 5.54 cents per ton per mile.
Post Office Department officials have announced, as their conclusion
from the results of the special weighing in 1907, that the average
length of haul of all mail is 620 miles.
The bulk of the mail is now carried on the heavy routes at 5.54 cents
per ton per mile, or $34.34 per ton for the average haul, that is, for
one and seven-tenths cents per pound.
The railroads, therefore, receive less than one and three-fourths
cents per pound for carrying the greater part of the mails.
* * * * *
But the rate reduction for wholesale quantities has not had the effect
of reducing the actual remuneration of the railroads for carrying the
mails to nearly so great an extent as the increasing requirements for
excessive space for distributing mails en route. This feature was
likewise discussed by Judge Moody in his report in the following
language:
"The rule of transportation invoked is based upon the assumption
that the increase of traffic permits the introduction of
increased economy, notably, the economy which results in so
loading cars that the ratio of dead weight to paying freight is
decreased. Yet this economy is precisely what our method of
transporting mail denies to the railroads. Instead of permitting
the mail cars, whether apartment or full postal cars, to be
loaded to their full capacity, the Government demands that the
cars shall be lightly loaded so that there may be ample space
for the sorting and distribution of mail en route. In other
words, instead of a freight car, a traveling post office."
An illustration of the extent to which the reductions have been
carried, as shown upon one railroad system, is set forth in the letter
of January 21, 1909, addressed to the Committee on Post Offices and
Post Roads of the House of Representatives by Mr. Ralph Peters,
President of the Long Island Railroad, who states that the actual cost
to his company of carrying the United States mail for the year was
$122,169, while the total compensation for that service paid by the
Government was $41,196. Mr. Peters says:
"The Long Island Company received from the Government for mail
service performed in expensive passenger trains one-half the
rate received by it per car mile for average class freight in
slow-moving freight trains."
The Long Island Company notified the Government that it would decline
to carry the mails by the present expensive methods, unless Congress
makes some provision for a more adequate compensation. A notification
of similar import has been given by The New York, New Haven & Hartford
Railroad Company, the principal carrier in New England. Their position
in this matter will undoubtedly be taken by other roads, because the
same condition of inadequate compensation prevails upon hundreds of
small railroads and mail routes, especially in the Southern and
Western States.
Notwithstanding these facts, a powerful interest, which commands the
public ear and derives great profit from the one-cent-per-pound rate
of postage, has, in order to divert public attention from itself, for
years industriously and systematically circulated false statistics and
false statements among the people regarding the railroad mail pay, and
is now circulating them.
The extent to which the public is being deceived regarding the
railroad mail pay is disclosed daily. In a recent hearing before the
Senate Committee on Post offices and Post-Roads, Senator Carter of
Montana said:
"We are all getting letters on this subject. I received the
other day a letter from a very intelligent lady in Montana
claiming that the Government is paying to the Northern Pacific
Railway on that branch line for carrying the mail $97,000 per
year. On inquiring at the Post Office Department, I find that
the total compensation of the Northern Pacific Company for mail
service on that line is $3,070 per year."
This state of things was a sufficient reason for the Post Office
Department to institute the present series of inquiries tending to
show the space in passenger trains upon the railroads demanded and
used by the Government for the mails in comparison with the space
devoted to express and passenger service, and the relative rates of
compensation in each class of service and the extent to which the
roads are receiving for carrying the mails the cost to them of
performing the service. In order to give these facts fair
consideration, it is not necessary to admit that "space" is, or is
not, a better and more workable basis for determining what is
reasonable mail pay than "weight," nor to admit that the companies are
only entitled to be paid by the Government for the service rendered to
it the bare cost of rendering that service, that is, to receive back
the train operating cost. Questions of speed and facilities furnished,
and the preference character of the traffic and the exceptional value
of the service, and other elements, must be considered as well as
space and cost, but that is no reason why the relative proportion of
space used and the relation of compensation to cost should not be
ascertained and given due weight, in the consideration of the
important question of what is adequate mail pay to the railroads.
The following pages are based upon answers to the interrogatories of
the Post Office Department and contain a statement of the mail service
performed by the Chicago, Burlington and Quincy Railroad Company, a
system extending westward from Chicago into eleven different States
and embracing approximately ten thousand miles of main and branch
lines.
The two principal tables of interrogatories were sent out under date
of September 28, 1909, by the Post Office Department as the basis for
this investigation.
These tables indicate the minute and thorough manner which the
Department employed in making this inquiry.
Some questions having arisen regarding the meaning and scope of the
word "authorized" in connection with the returns of space occupied and
used for the mails in Post Office cars and apartment cars, and in
certain other features, the Department, under date October 23, 1909,
issued an important supplementary letter of instructions.
Pursuant to these interrogatories, instructions and requests the
Burlington Company has filed with the Department the exact and
detailed statements, train by train and car by car, of the mail
service upon each of the one hundred and two mail routes on its
system, large and small, for the month of November, 1909, which were
thus called for. These answers state the facts and state them in the
manner prescribed wherever possible. Every inch of space on passenger
trains and cars which in these tables is shown to be occupied or used
for mail or express or for passengers is set down from actual
measurements made, car by car, and not upon any "estimate" or
"consist" basis.
In the appendix will be found four tables prepared under the direction
and supervision of Mr. DeWitt which contain the results of this
investigation into the mail service upon the Burlington, as disclosed
in these statements.
Exhibit A is a statement of the car facilities or space used in every
car in service on the road during the month of November for mail, and
for express or occupied by passengers based upon replies to questions
prescribed in Form 2601.
Exhibit B is a statement of the station facilities, furnished for the
mail, prepared on Form 2602.
Exhibit C is a statement of Revenues and Expenses and of train and car
mileage, prepared on Form 2603.
Exhibit D is a statement of the number, and cost, and present value of
Post Office cars and Apartment cars, prepared on Form 2605.