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V. In 1843 the revival of business under the new tariff, the extension of the Western Rail-Road to Albany, and a reduction on railway charges, gave a new impulse to the system. Many lines were commenced, and much capital took this direction. Large returns of net income in 1847, when the Irish famine gave another impulse to travel and business, drew more capital into railways, and a rapid expansion followed.

The check given to manufactures by the tariff of 1846, which threw burthens on the raw material, drew still more capital into railways, and for one or two years Massachusetts devoted, at home and abroad, at least twenty to thirty millions annually to rail-roads.

With the discovery of gold in California and the expansion of rail-roads in other States, there came an increased demand for capital and artisans ; interest and wages advanced; competition arose; renovation became necessary; expenses increased, and heavy losses and sacrifices followed.

VI. The net income declined, and the value of stocks depreciated as a necessary consequence.

This decline, and the shock given by 1857 to credit and to enterprise, again reduced prices and taught economy. The number and speed of trains were reduced; supernumeraries were discharged; materials and wages fell; coal was substituted for wood, with great advantage; debts were funded, and income applied to the reduction of indebtedness

. As cost was thus diminished, the natural growth of business, which has attended rail-roads in every country, aided by a diminution of expense, has promoted recovery; stocks have again risen from their depression. They are fast recovering the confidence of the public, and are again considered a safe and remunerative class of investments.

Some effects have followed the growth of railways in Massachusetts which deserve the attention of the political economist :

First.—They have superseded three important canals, which were once in active use, the Middlesex, the Hampshire and Hampden, and the Blackstone, with a series of works on the Connecticut and Merrimac. Cheap and rapid transit on lines which crossed both rivers and mountains and bid defiance to winter's ice and snow, diverted the traffic from the slow canal with its wearisome lockage, ice-bound half the „year. Canals are now abandoned in Massachusetts.

Second. They have greatly stimulated the growth of cities and villages, attracting population and manufactures to the line of the iron way. The growth of population in Massachusetts, still more than two per cent. annually, is confined to cities and villages. Some of the inferior farms have been devoted to the production of fuel, in many places worth $3 per cord as it stands, although other farms are more highly cultivated.

Third.—The freight has grown with more rapidity than the passenger traffic. In 1842 it furnished but one-third the revenue; now it supplies more than half, and still continues to gain upon passengers. Much of this freight may be regarded as the creation of the railway. Masses of ice, coal and timber are thus set in motion, and made tributary to commerce and useful to the world.

Fourth.— The State is able, by its railway system, to convene its people, to concentrate its whole military force upon a single point and in a single day, upon a few hours' notice. The votes of two hundred

thousand citizens are announced the morning after the polls are closed. Immense bodies are collected on festive days, and in the event of any attack

upon the State, this power of rapid concentration and action will be most effective for the common defence.

Fifth.— The effects of high and low prices have been effectually tested. The charge for passengers has ranged from 44 to 2 cents per mile, upon various lines and at various periods. Competition, experiment and success have reduced prices to the lower standard, and with the growth of expenses and in periods of depression they have again advanced.

Low prices increased numbers, stimulated building and promoted the growth of traffic, while they have awakened the jealousy of stockholders engaged in trade, who usually look to the advance of prices as the sure road to wealth.

The result has been, that the public mind is settling down upon the rate of 2 to 3 cents per passenger a mile for the long traffic, and 2 cents per mile for the short traffic, with a charge for season tickets equivalent to 1 or 1} cents a mile for each passage.

The freight is allowed to vary according to value, quantity, distance and gradients, from 14 to 8 cents per mile.

Sixth.—The rail-roads of Massachusetts have gradually reduced their debt until it now constitutes less than one-fourth of the capital of our companies, and their policy seems to be to effect its extinguishment. Out of debt, out of danger, is the lesson taught them by experience. Of late years they have reserved nearly a fourth of their income for reduction of debt and improvements, and now hold nearly six millions in surplus and sinking funds.

Seventh.—Another effect has attended the growth of rail-roads and their extension through the streets of cities, viz., the introduction of an admirable system of horse railways—a minor edition of the rail-road itself.

VII. During the year 1860, fifty-seven miles of horse railways have been in operation in Massachusetts, and by the close of the year two of them were extended from Boston to Lynn, on lines ten to eleven miles in length; and during 1860, 13,695,000 passengers (actually more than on the steam roads) were transported upon the horse railways of Massachusetts, at an average charge of about 2 cents per mile.

The cost of these lines is now reported as close upon three millions ; their net revenue is 9 per cent., and the cost of conducting them is rated at 20 cents in the cities and 15 cents in the country for each mile run by the two-horse cars, which transport usually not far from an average of fifteen passengers. The cost of transportation is thus apparently 1 to 11 cents per passenger a mile, and where passengers abound, a charge of two cents per mile is found amply remunerative.

Although the cost of these lines has been greatly enhanced by experiments and by a process known as watering the stock, viz., by issues at a fictitious cost, it is now generally understood that a horse railway can be made of good quality, at a cost of $5,000 per mile on country roads, and $10,000 to $15,000 per mile in cities, exclusive of the equipage, stablen and changes of grade.

We have thus glanced at the general system of the State, its progresa,

its trials and its effects. To appreciate it better, it is desirable to examine some of the leading rail-roads of Massachusetts.

VIII. The Boston and Worcester Rail-Road. This road is one of the pioneer lines of the State. In the early spring of 1834, the first section of ten miles was opened for use, and on the morning of the first of May the locomotive was set in motion. There was no bonnet upon the engine, and a large party of ladies, with their beaus, enlivened by a host of sparks, made their first excursion by steam from Boston into the country.

This line commenced with very limited means; and having no direct natural valley to follow, a devious route was pursued, conforming closely to the surface, with a ruling gradient of thirty feet to the mile, and a narrow location was adopted. A light edge rail, weighing less than forty pounds to the yard, was introduced and laid, principally upon ties of white cedar embedded in the primitive soil, and little space was allowed for drainage.

The company were induced, by a grant of several acres of land, at a nominal price, to establish their Boston station upon the South Cove; but in the provision of land and buildings, the growth of business was greatly underrated. The provision for freight consisted of an open yard, with a small wharf, store and freight-house, which would not receive at once more than two or three long cars.

From 1834 to 1840, the whole capital raised was but $1,840,000.

The equipage of the line consisted, for several years, of a few light engines and single cars, for both freight and passengers, some of which were imported from England. Worcester was then a village with four or five thousand people, whose trade sought the New-York and Providence markets by the Blackstone Canal. It offered so little merchandise, that for some time the average freight from Worcester to Boston did not exceed twelve tons per train. Until the close of 1839, the line drew a very moderate income from its light local traffic. Its rails were injured, its tracks disturbed by frost, its cars and engines worn out by use or gone out of fashion, and its dépôts unsuited to the day. Its charges had been as high as 44 cents per passenger a mile, and its rate for freight up to 7 to 8 cents per ton a mile, from which rates it with difficulty paid a moderate dividend, and accidents frequently occurred, from the deterioration of its tracks and engines.

But in 1839 the Norwich and Worcester and the Western Rail-Roads were opened, from tide-water at Norwich and the navigable waters of the Connecticut at Springfield, into Worcester, and a new impulse was given to the Boston and Worcester line. An investigating committee, in 1846, reported its defects, and suggested some of the remedies to the stockholders, and prompt measures were taken for its renovation. The capital was rapidly increased, by stock and bonds, from $1,840,000 to $5,500,000, three times the original amount; the road-bed was raised, widened and graveled, new rails were provided, a second track laid, branches opened, and superior engines and long cars purchased. Several acres of land were obtained, at high prices, and extensive dépôts and engine-houses erected, and the revenue rapidly increased, and the dividends soon rose to eight per cent. per annum.

For a time the directors adhered to their system of high prices, and induced the Western Railway to charge $6 50 per ton and $3 75 per

passenger between Boston and Springfield, and business was thus for a time repelled ; and when the Western Rail-Road adopted rates very nearly the same as those now established, the Boston and Worcester line declined to take a pro rata share, and commissioners were called in to adjust the difference; but gradually moderate rates were established, special trains, with season tickets and low fares, were set in motion, and now the Boston and Worcester Rail-Road exhibits a line fringed with villages, villas and suburban residences, and has raised its revenue from $210,000 in 1837 to more than a million in 1860. It has, doubtless, in the past, shown some want of prescience. It has made more branches than are profitable ; the renovation of its tracks and road-bed, and the acquisition of land after use have enhanced its value, and doubtless carried its capital to an unnecessary height; but in the past ten years its cost has been reduced from income more than half a million. It divides eight per cent., and it is now conducted, by its present officers, with a degree of promptitude, efficiency and success alike acceptable to the public and the shareholders.

IX. The Boston and Lowell Rail-Road.This line, from Boston to Lowell, twenty-five miles, was constructed at the same time with the Boston and Worcester, and considered a very bold experiment, as it run nearly parallel with the Middlesex Canal. Its engineer aimed at a level route, and its gradients, except for a few feet near its Lowell terminus, did not exceed ten feet to the mile, and heavy expenses in cuts and embankments were incurred to secure this gradient and curves of large radius. Road crossings were generally avoided, extensive dépôt grounds and accommodations were obtained at Cambridge and Boston, a liberal provision was made for the future, and a second track was soon provided. The fish-belly rail, popular in England, was first selected, and laid down upon stone cross-ties, upon a well-ballasted surface. These ties have proved less elastic and durable than those of wood. The cost of the line in 1837 was but $1,500,000, but it was carried soon after, by the completion of its second tracks and dépôt grounds, to $1,800,000 ; and, with a slight addition of debt for new equipage and the short branch at Woburn, the capital, for some twenty years, has continued stationary.

The stand-still policy has, until very recently, been the policy of the Boston and Lowell line; and this is almost as dangerous as the expansion policy. While the city of Lowell and the local business were annually progressive, other parties took up the subject of branches, and shaped them so as to divert the legitimate business of the Boston and Lowell line. A line was carried from Nashua to Worcester, diverting largely from the trunk line. The Manchester and Lawrence line made another diversion from the trunk line. The Lowell and Salem Rail-Road became another competitor, and, crossing the Boston and Maine, which might casily have been retained as a tributary, competed for all the heavy freight of the factories, and for a part of the Boston passenger. The Fitchburg line diverted also a business that might have been attracted to the Boston and Lowell and the trunk of the Boston and Lowell line. Like a solid oak, stripped of its leaves and denuded of its branches, it stood for a time almost in solitary grandeur, a warning to other lines not to neglect branch accommodation. Its stock declined from a high premium to about fifty. per cent. At length a new policy was inaugurated. Treaties were made, binding more closely to it the Nashua and Lowell line, and giving it the control of the Lowell branches. The diversion of business was thus arrested, and, under the able management of the present dynasty, the stock has risen above par, and good dividends are returned to the stockholders.

X. The Boston and Providence Rail-Road. This line, 43 miles in length, is coeval also with the Boston and Worcester, and in 1835 came into active operation.

Its original cost was a little less than $1,800,000, and as it occupied an important route both to Providence and New-York, and succeeded to a large business previously conducted by teams and stages, it soon became a successful enterprise and made large dividends to the stockholders. It was distinguished at first for high charges. Its rates for passengers were 44 to 5 cents per mile, and its rate for freight was five dollars per ton, or twelve cents per ton a mile. But these high rates and a close and exclusive alliance with a line of steamers running through the Sound, aroused jealousy and opposition.

The Seekonk Branch was built, and a strenuous effort made to break the monopoly, which involved the company in a considerable expenditure. After this the Norwich and Worcester line obtained the State aid, and was pressed through with energy and much popular favor, in consequence of the high charges upon the Boston and Providence line; and when this new line was opened, in 1839, the net income of the Boston and Providence was reduced more than fifty per cent., and in 1840 its net revenue fell from ten to four and a half per cent.

The directors, who had to this point resisted the popular current, were at length obliged to reduce their passenger rates twenty-five per cent., and their freight charges forty per cent.

The effect of these measures was electric. Their warehouses soon overflowed with freight; a large amount of Providence business was soon diverted from New-York to Boston, and the foundation was laid for an active intercourse between Rhode Island and Massachusetts. The railroad company was compelled to enlarge and rebuild its station-houses, and some gentlemen who had resisted all changes and listened with incredulity to the predictions of the results which occurred, at length commended the wisdom evinced in the new measures adopted.

From 1840 to 1847 the line continued to revive with the rapid growth of business, and in the latter year had again recovered its early prosperity and made large and satisfactory dividends; but success itself is often bewildering

Large expenditures were made for a costly branch from West Roxbury to Dedham, a point already reached by a branch ; an improvement which for a long time gave no adequate return. And further and still larger expenditures were made for a new route from the main track through Pawtucket to Providence, to avoid a ferry; some second track was also laid and costly buildings were erected.

By these measures the cost of construction was suddenly doubled, and the amount carried from $1,800,000 to $3,600,000, without securing any important feeder to the line.

This sudden change gave a severe shock to the company, which for several years found it very difficult to meet its interest, and a six per cent.

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