ing much smuggling. On those principles they of course charged much more for long routes than for short ones. Until 1845 the United States minimum charges were as follows: under 30 miles, 6 cents; under 80 miles, 10 cents; under 150 miles, 12 cents; under 400 miles, 183 cents; over 400 miles, 25 cents. Yet, even at this time, before the development of railways to any extent, it was computed that the cost of transmission of letters constituted less than two sevenths of the whole, and the cost of collection and delivery more than five years showing a very slight deficit; so that practically revenue balanced expenditure. From 1852 to the present time there has generally been a deficit as shown by the following table of the money paid out of the United States Treasury to meet deficiencies in the postal revenues: It will be observed that the deficit had been reduced to small proportions just prior to the reduction of the rate of letter postage in 1883. — ED. sevenths. Compared with what it would cost the sender to evade payment, the differential rates were just; compared with what it cost to perform the service, they were absurd. And, as time went on, the absurdity increased. Improved means of communication rendered the whole cost of transmission a less important element; rapid increase of communication between distant places still further reduced differences in the cost of transmission. And with the rising feeling in favor of a system based on expense, not on profit-"freight, not tax," in the words of the day-a gradual equalization of rates for different distances was inevitable. On the continent of Europe, there was, for like reasons, a similar tendency, partially carried out, to do away with weight as an element in letter postage. This idea never took much hold in America, unless we regard the treatment of books and newspapers as an instance of it. There is no inherent reason why the post office should prefer to carry printed matter rather than written matter of the same weight. But printed matter, being habitually sent in large parcels, was, weight for weight, far easier to handle; especially so in the case of papers which went from day to day on the same routes in about equal quantities. Moreover, monopoly rates had never taken firm root here, owing to the competition of private agencies in the delivery of unsealed matter. All these reasons combined to produce the lower rates on those classes of goods. These practical ideas are followed out in the inland postage of almost all civilized countries, whether the results are such as to more than cover or slightly less than cover the .expense. In international postage it is sometimes difficult to carry them out with fairness. The five-cent rate was based on a rough average of transmission expenditures; and countries unfortunately situated or organized may be unable to meet their foreign postal expenses on this rate. The general advantages of belonging to the postal union are a sufficient compensation for such of these inequalities as cannot be satisfactorily arranged. - In 1867 Professor 19. The Post Office and Other Industries. Jevons published the following paper upon "The Analogy between the Post Office, Telegraphs, and other Systems of Con veyance in the United Kingdom in regard to Government Control":1 It has been freely suggested of late years, that great public advantage would arise from the purchase and reorganization of the electric telegraphs and railways of the United Kingdom, by the government. So inestimable, indeed, are the benefits. which the post office, as reformed by Sir Rowland Hill, confers upon all classes of society, that there is a great tendency to desire the application of a similar reform and state organization, to other systems of conveyance. It is assumed, by most of those who discuss this subject, that there is a close similarity between the post office, telegraphs, and railways, and that what has answered so admirably in one case, will be productive of similar results in other parallel cases. Without adopting any foregone conclusion, it is my desire, in this short paper, to 'inquire into the existence and grounds of this assumed analogy, and to make such a general comparison of the conditions and requirements of each branch of conveyance, as will enable us to judge securely, of the expediency of state control in each case. Much difference of opinion arises, even in a purely economical point of view, upon the question of the limit of state interferences. My own strong opinion is that no abstract principle, and no absolute rule, can guide us in determining what kinds of industrial enterprise the state should undertake, and what it should not. State management and monopoly have most indisputable advantages; private commercial enterprise and responsibility have still more unquestionable advantages. The two are directly antagonistic. Nothing but experience and argument from experience can in most cases determine whether the community will be best served by its collective state action, or by trusting to private self-interest. On the one hand, it is but too sure that some of the state manufacturing establishments, especially the dockyards, form the very 1 Reprinted from the Transactions of the Manchester Statistical Society, 186667, pp. 89-103. This essay was later included in Jevons's Methods of Social Reform (1883). types of incompetent and wasteful expenditure. They are the running sores of the country, draining away our financial power. It is evident too that the House of Commons is at present quite incapable of controlling the expenditure of the dockyards. And as these establishments are never subjected to the test of commercial solvency, as they do not furnish intelligible accounts of current expenditure and work done, much less favor us with any account or allowance for capital expenditure, we have no security whatever that the work is done cheaply. And the worst point is, that even if government establishments of this kind are efficiently conducted when new and while the public attention is on them, we have no security that this state of things will continue. To other government establishments, however, the post office presents a singular and at first sight an unaccountable contrast. Instead of Mr. Dickens's picture of the Circumlocution Office, we are here presented with a body of secretaries and postmasters alive to every breath of public opinion or private complaint, officials laboriously correcting the blunders and returning the property of careless letter writers; and clerks, sorters, and postmen working to their utmost that the public may be served expeditiously. No one ever charges the post office with lavish expenditure and inefficient performance of duties. It seems then that the extremes of efficiency and inefficiency meet in the public service, and before we undertake any new branch of state industry, it becomes very important to ascertain whether it is of a kind likely to fall into the efficient or inefficient class of undertakings. Before we give our adhesion to systems of state telegraphs and state railways in this kingdom, we should closely inquire whether telegraphs and railways have more analogy to the post office or to the dockyards. This argument from analogy is freely used by every one. It is the argument of the so-called reformers, who urge that if we treat the telegraphs and the railways, as Sir Rowland Hill treated the post office, reducing fares to a low and uniform rate, we shall reap the same gratifying results. But this will depend upon whether the analogy is correct - whether the telegraphs and railways resemble the post office in those conditions which render the latter highly successful in the hands of government, and enable a low uniform rate to be adopted. To this point the following remarks are directed. It seems to me that state management possesses advantages under the following conditions: I. Where numberless widespread operations can only be efficiently connected, united, and coördinated, in a single, allextensive government system. 2. Where the operations possess an invariable, routine-like character. 3. Where they are performed under the public eye or for the service of individuals, who will immediately detect and expose any failure or laxity. 4. Where there is but little capital expenditure, so that each year's revenue and expense account shall represent, with sufficient accuracy, the real commercial conditions of the department.1 It is apparent that all these conditions are combined in the highest perfection in the post office. It is a vast, coördinated system, such as no private capitalists could maintain, unless, indeed, they were in undisputed possession of the field, by virtue of a government monopoly. The forwarding of letters is a purely routine and equable operation. Not a letter can be mislaid but some one will become aware of it, and by the published tables of mail departures and arrivals the public is enabled. accurately to check the performance of the system. Its capital expenditure too is insignificant compared with its current expenditure. Like other government departments, indeed, the post office does not favor us with any statement of the capital value of its buildings, fittings, etc. But in the post-office accounts, we have a statement of the annual cost of buildings and repairs, together with rents, rates, taxes, fuel, and lights. In the last ten years (1856-65) the expense 1 It will be interesting to note the following comment which President Hadley has made upon the criteria here suggested by Jevons: "All this is good as far as it goes; but it leaves the heart of the difficulty untouched. Passing over the first of these points, which really begs the whole question, we have before us, not an indication of the conditions under which a government can manage an industry with the best advantage, but of those under which its management is attended with the least danger. Jevons's principles are restrictive and not positive. They show how far you can trust the government with. out serious danger of financial mismanagement," Hadley, Economics, 398. — ED. |