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RAILWAYS IN THE UNITED STATES.
INTERSTATE COMMERCE COMMISSION,
To the Honorable Members of the Interstate Commerce Commission :
SIRS: Pursuant to instructions I submit herewith the First Annual Report on Railway Statistics in the United States for the year ending June 30, 1888.
In the preliminary report from this office, presented to the Interstate Commerce Commission under the date of December 1, 1888, and printed as Appendix H to its report, reference was made to the importance of reliable information on railway affairs. It was shown that railway statistics are essential for a proper appreciation of many problems of public economy, for sound conclusions on technical and scientific questions of railway management, as well as for the satisfactory performance by the Commission of the peculiar duties which Congress has assigned to it. These considerations need not be presented a second time. Indeed, there was never much necessity for argument on this question.
But whatever the impression on the part of the public, or of the railway managers, with regard to statistical information, it is certain that the framers of the "Act to regulate commerce" intended to provide for comprehensive and authoritative railway statistics. This is clearly shown by the wording of the twentieth section of the act creating the Interstate Commerce Commission, which is as follows:
That the Commission is hereby authorized to require annual reports from all comnon carriers subject to the provision of this act, to fix the time and prescribe the manner in which such reports shall be made, and to require from such carriers specific answers to all questions upon which the Commission may need information. Such annual reports may show in detail the amount of capital stock issued, the amounts paid therefor, and the manner of payment for the same; the dividends paid, the surplus fund, if any, and the number of stockholders; the funded and floating debts and the interest paid thereon; the cost and value of the carrier's property, frauchises, and equipment; the number of employees and the salaries paid each class; the
amounts expended for improvements each year, how expended, and the character of such improvements; the earnings and receipts from each branch of business and from all sources; the operating and other expenses; the balances of profit and loss; and a complete exhibit of the financial operations of the carrier each year, including an annual balance-sheet. Such reports shall also contain such information in relation to rates or regulations concerning fares, or freights, or agreements, arrangements, or contracts with other common carriers as the Commission may require, and the said Commission may, within its discretion, for the purpose of enabling it the better to carry out the purposes of this act, prescribe (if in the opinion of the Commission it is practicable to prescribe such uniformity and methods of keeping accounts) a period of time within which all common carriers subject to the provisions of this act shall have, as near as may be, a uniform system of accounts, and the manner in which such accounts shall be kept.
It need hardly be said that this provision of the law lays the groundwork for a very exhaustive investigation into railway affairs. Not only does it prescribe certain questions that must be asked, but it grants to the Commission the right to require specific answers to all questions respecting which information may be needed. Indeed, it is the extent of the investigations prescribed by the law, rather than any limitation imposed by the law, that occasions the greater embarrassment. It is no light task to organize a statistical bureau for so complicated a business as that of inland transportation, embracing all the points on which Congress calls for detailed information.
ORGANIZATION OF STATISTICAL WORK.
The first step taken in conformity with the duties prescribed by the section above quoted was to provide a blank form for an annual report from the common carriers. Manifestly it was desirable that this form should follow as nearly as possible the forms already issued by the Commissions of the various States, and that it should not diverge, except for good reason, from the ordinary methods of book-keeping already adopted by the railways. That this was kept in mind by the Interstate Commerce Commission in drafting their blank form is shown by an account of the manner in which the work was undertaken.1 That account is as follows:
"In October, 1887, a circular was issued to all carriers, as well as to "the various State Commissions and other persons supposed to be in"terested in the general question, directing attention to the subject and "announcing that it would be considered at a public session of the Com"mission, to be held in Washington on October 26, at which time all
persons were invited to appear and be heard, or to furnish any writ "ten or printed suggestions that might occur to them. This circular
1 As a matter of record it may be proper to note that the office of "Statistician" was not created until October 12, 1888, and that up to that time all matters pertaining to statistics were under the immediate direction of the Commission.
"elicited considerable correspondence, and a large number of State "and railroad officials were in attendance at the time announced. A "free interchange of views was had in respect to the general scope of "the reports to be required.
"The preparation of a form was then entered upon, and a proposed "or experimental set of blanks was printed in January, 1888, which "was distributed to State boards, railroad accountants, and other per"sons interested. In that connection it was explained that these blanks were circulated for examination and criticism in order to obtain the "fullest possible comparison of views before a form should be definitely "adopted; it was also explained that no very radical departure from "existing methods was proposed; that the forms required by State "Commissions were made the basis of the draft; that a very sub"stantial benefit would result from the passage of the act if the plan "which the Commission should finally adopt might be made the basis "of a form to be brought into general use for all reports, and therefore "that a prominent object had been to prepare blanks which should con"tain all the more important information usually to be found in rail"road reports, and at the same time be susceptible of expansion in "detail to meet the requirements of State statutes and of exacting "accountants and boards of directors. Some further explanations "were made and the subject was thrown open for suggestions from any "and all persons interested."
"Much correspondence was elicited in response to this invitation, and "on March 28, 1888, a meeting of railway accounting officers was held "in Washington to consider said proposed form of annual report. This "meeting was attended by the representatives of more than 70,000 "miles of railroad, and the blanks under consideration were taken up "and discussed in detail. Many suggestions were made which were "obvious improvements and were incorporated in the final form. Con"ferences were had with State and railroad officials in New York City "and elsewhere, and the vast amount of matter accumulated was care"fully examined and digested. The form ultimately determined upon "was the result of great consideration and a sincere effort to harmon"ize all the requirements of the situation so far as practicable."
The form finally decided upon presented to the common carriers the following topics, respecting which they were asked to make reply:
4. Property operated.
5. Capital stock.
6. Funded debt.
7. Floating debt and current liabilities.
8. Permanent improvements for the year. 9. Cost of road and equipment.
10. Income account.
11. Income account (for roads under lease
12. Earnings from operations.
13. Bonds owned,
14. Stock owned. Miscellaneous income. 15. Operating expenses.
16. Operating expenses-continued. 17. Rentals paid.
18. General balance-sheet.
19. Financial operations for the year. 20. Important changes during the year. 21. Contracts, agreements, etc.
22. Security for funded debt (page 6). 23. Employés and salaries.
24. Passenger, freight, and train mileage.
25. Freight traffic movement (company's material excluded).
26. Description of equipment.
27. Mileage of road operated. Renewals of rails and ties.
28. Consumption of fuel by locomotives. Accidents.
29. Characteristics of road.
30. Characteristics of road-continued. 31. Oath.
The drafting of a form for annual reports from the carriers was but the first step towards the organization of railway statistics in the United States, under the direction of the Federal Commission. It was quickly seen that so comprehensive a work could only attain to its highest usefulness through the co-operation of the State Commissioners, and as a second step towards organizing what may be termed complete official railway statistics mention must be made of the Convention of Railway Commissioners held on the 5th, 6th and the 7th of March of the current year in Washington. The question which claimed the chief attention of this convention was the question of "Uniform Railway Statistics." A paper was read pointing out the advantages of harmonious action on the part of State Commissions and the Federal Commission in regard to this matter, and a table submitted, showing the degree of uniformity already existing in the collection of statistical data. The impression left by a study of this table seems to be that, so far as fundamental ideas are concerned, there already exists a very satisfactory degree of harmony, and that it is only necessary to adjust certain details in order to establish in the United States uniform methods for collecting and presenting railway statistics. The spirit of the convention was most encouraging on this point. A resolution was adopted to the effect that "it is the sense of this convention that a method of collecting and publishing statistics, both as to time and matter, should be adopted." A committee composed of one representative of each of five States, a representative of the Interstate Commerce Commission, and the president of the Association of American Railway Accounting Officers, was charged with the duty of revising the Interstate Commerce Commission's form for annual returns from railways. The members of this committee spent considerable time in discussing the details of the form, and, as their report was adopted by the convention, the form issued by the Interstate Commerce Commission, as amended by the committee, may now be said to be the official form for railway statistics in the United States, both State and Federal. It will doubtless require some time for the State
This paper and accompanying table are printed as appendix to this report.
legislatures to adjust their laws so as to permit Railway Commissioners to adopt the form recommended by the convention; but an important step has been taken when the intention of recommending such changes is declared by a Convention of State Railway Commissioners without a dissenting voice. All things considered, it may be said that the task of organizing comprehensive official railway statistics in the United States is in a very satisfactory state of advancement.
CONSIDERATION OF QUESTIONS ASKED FROM RAILWAYS.
Returning now to the consideration of the questions asked in the form itself as given above, it may be well to say a few words respecting the nature of the information to be gathered. This information may be classified under four general heads: First, questions are asked respecting the corporate history of the several roads, and their organization for purposes of operation; second, returns are required bearing on the financial standing of railway corporations, whether they be operating or subsidiary corporations; third, what may be termed "statistics of operation" are demanded; fourth, statistics pertaining to the physical characteristics of roads are made the subject of inquiry.
The object of the inquiry thus indicated may be easily perceived. The railway problem is one that presents itself in many phases, but at the present time there are two questions of more importance than all others. The first of these pertains to fair, uniform, and steady rates between the railways and the public for service rendered; the second to the number and situation of new lines that can be economically constructed. For neither of these questions is there as yet any absolute answer. General principles, it is true, may be laid down, but in the application of those principles accurate and detailed knowledge of conditions is essential; and the nature of the knowledge required is, as will be readily admitted, such as may be gained by the questions outlined above. Indeed there are no questions asked of the common carriers which are not necessary to the satisfactory performance by the Interstate Commerce Commission of the duties which Congress has devolved upon it.
But it may be said, indeed it has been said, that the form asks for certain facts which cannot be given with accuracy, if they can be given at all, and the query has been raised how it is proposed to deal with such an investigation.
The experience of this office does not warrant the statement that facts respecting any of the items mentioned by the law cannot be obtained, but it is highly probable that on one or two points it will be necessary to rest satisfied with information that is not absolutely conclusive. Is it, for example, possible to discover "the cost and value of the carrier's