harmonious investigation has already been laid, and that it is only necessary for us to adjust the details of the several plans to some common idea. The accompanying table, which is made up from the forms for annual reports issued by the various commissions to the railway companies, will show the degree of uniformity which already exists in official railway statistics in the United States, so far as general line of inquiry is concerned. [Here followed an explanation of the plan on which the table is drawn, and a few remarks calling attention to the uniformity in the line of inquiry undertaken by the States. The explanation may be found by turning to page 357, while the facts referred to may be easily recognized by the reader if he will glance at the table itself.] I will not further occupy your time in explaining this table, or in calling your attention in detail to the lines of common inquiry which it discloses. One point only of this nature, and we will pass to sugges tions for perfecting that harmony of action for which the first steps have been so successfully taken. It need hardly be said that a system of statistics which fails to recognize some common unit of measurement for the forces studied can serve no rational purpose. Now, the unit adopted by the best authorities in railway statistics is the ton-mileage or passenger-mileage unit, and it is a matter for congratulation that all of the State commissions, with two exceptions, reduce the traffic figures which they present to this common basis; and in these two cases this common basis of measurement will undoubtedly be adopted when their statistical work is developed sufficiently to allow of general reductions. In this respect American railway statistics are in advance of those of England, which still accept train-mileage as the unit of measurement. It seems, then, that the problem of establishing uniformity of railway statistics in the United States is by no means a difficult one. The first steps in that direction have already been taken, and it is only necessary to go with care over certain matters of detail so as to come to a common understanding as to the exact meaning of such inquiries as are made, and adopt common theories for the classification of items. Permit me to suggest one or two points that call for immediate attention. The first point that should be considered pertains to the date adopted for the close of the fiscal year. As matters now stand ten of the commissions accept June 30 as the close of the fiscal year; six States have accepted September 30, five States have adopted December 31, one State calls for quarterly, and one for monthly returns. Now, if the statistical results of the State commissions and of the Interstate Commerce Commission are to be used as checks each against the other, it is essential that the financial year adopted as the basis of returns should be the same for all. There are certain advantages in accepting June 30 as the date for closing books, but as this question has received so much attention of late, I will do no more at this time than to suggest it for yet further consideration. Another topic that should be considered by this convention pertains to the classification of operating expenses. There are now twelve States that have adopted what is known as "The Saratoga Classification," which, as you are aware, was drawn up by a conference of State railroad commissioners in Saratoga in June, 1879. So far as I am aware, no general complaint has ever been urged by the auditors of the various roads with regard to this classification. It seems to be as simple as the subject admits of. Many auditors have, during the last year, adjusted their accounts to its requirements, and it is believed that formal action by this con vention favoring this classification is all that is needed to lead to its universal adoption. Certainly if this be the case, arguments in favor of such a step are not needed. It is absolutely essential for attaining the best results, that operating expenses be reduced to uniform classification. In close connection with classification of operating expenses stands the division of expenditures between "expenses of operation" and "fixed charges." The rule adopted in this office is to assign taxes to fixed charges, and for all general problems in railway economy there are many reasons favoring such a classification. But the reports of the States show no uniformity on this subject. In some cases taxes are classed as fixed charges, in some they are included in operating expenses, while other reports keep them separate from both items. It would add greatly to the ease with which these reports could be used should some uniform rule of treatment be adopted. Another question deserving consideration pertains to the rule for estimating the deterioration of railway property through wear and tear. There seems to be almost total absence of uniform action on this point, while many roads apparently omit this altogether from their accounts; and yet, when we consider the ease with which facts of this nature may be collected, provided only a proper method of book-keeping be adopted by the railways, and when we notice what direct bearing the rate of wear on rolling stock has on questions of railway economy, the omission is a little surprising. The reverse of this question is that of betterments and improvements. A great deal of attention has been given to the proper method of accounting for moneys expended in permanent im- . provements or applied to reduction of indebtedness, and, as is well known, the question involved is one that is decided differently by different States and railway administrators. So far as a railway is concerned, it depends largely upon the financial policy adopted whether permanent improvements are charged to operating expenses or to the improvement account. The public certainly ought to make no complaint if the latter method is adopted. At the same time, when the use to be made of statistics is held in mind, accounts should be kept so as to allow of some degree of uniformity as to the meaning of operating expenses. This is a difficult matter to adjust, and should receive the careful attention of those interested in railway statistics. It is unnecessary to follow this subject further, or to suggest more of the topics that call for detailed discussion. There can be no question of the desirableness of uniform railway statistics in the United States, and, as has been discovered, the degree of uniformity that now exists is such as to encourage further steps in the same direction. It only remains for the members of the convention to consider with care which steps should be taken first, and in what manner the desired end may be most easily attained. 464 A-23 |