As these short lines are supported entirely by local traffic, a proper comparison of their rates with those of the Central Pacific should consider only the local rates of the latter. The commissioner, in the same table, furnishes us with these, so that we are enabled to make the following comparison:
The average charge per passenger per mile was, on the short lines, 6100 cents; on the Central Pacific (for local only), 2100 cents. The average charge per ton of freight per mile was, on the short lines 12100 cents; and on the Central Pacific—for local only—3100 cents.
Here, again, the facts show that this great California corporation, which is charged by the Anti-Monopoly League with constant and destroying extortion, has much lower average rates than these smaller companies which are not conspicuous enough in size or wealth to draw the attention of the press or the attacks of politicians.
The tendency of railroad ownership and management has from the beginning been toward amalgamation. This is apparent to all, and is popularly termed the growth of monopoly. The facts that have herein been presented all tend to illustrate the truth that this amalgamation has been accompanied by as constant a reduction of rates. The so-called "monopoly" is thus shown to be exactly the opposite of those privileged corporations which, in the past centuries, have given the word its evil significance: for, without any special or exclusive privilege, the railroad is in itself an institution which naturally secures whatever monopoly it has of the business of transportation by the superior advantages and cheapness which it affords. With the reduction of rates, therefore, the "monopoly" must increase; for the reduction of rates means an increase of traffic.
The reduction of rates, however much it may be influenced by the competition of parallel lines, is absolutely controlled by the operation of those great natural laws which govern all commercial transactions. These laws are summed up in the statement, made some years since by the President of the Central Pacific Railroad Company, that "the interests of the railroad and the community are identical." The prosperity of the former is absolutely dependent upon the prosperity of the latter; and the development of the industries and the increase of the products of the communities depend upon cheap transportation, perhaps more than upon any single thing. It becomes, therefore, not only the interest of the railroads to furnish cheap transportation, but they are led also to the same action in their efforts to increase their net income. As the ratio of expenses decreases with the increase of traffic, a reduction of rates which secures an increase of traffic thus produces an increase of net profit. Consolidations, by reducing the ratio of expenses, make possible the greater reduction of rates; and