REVIEW OF HON. E. B. WASHBURNE’S PAPER ON THE UNION OF THE TELEGRAPH AND POSTAL SYSTEMS. (continued 2)

We cannot think that a department whose expenses exceed its receipts by $6,437,991.85 in a single year; which cannot even guess within a hundred millions of the number of letters it transmits per annum; which provides only forty-six free delivery offices out of a total of 29,387 post-offices in the United States; which does not even pretend to give the number of letters delivered free for any one year; and which sends over 4,500,000 letters to the Dead-Letter Office per annum, is a very proper guardian of so important an interest as the Electric Telegraph.

The space occupied for the various telegraph offices in all the principal cities of the United States is considerably greater than that required by the post-offices, while the rent paid by our company, owing to the more central and eligible situations of our offices, is greatly in excess of that paid by the Post-Office Department. In New York, our company pays $40,000 per annum for rent of its central office alone. So far as space and eligibility of location is concerned, we could much better accommodate the public by the delivery of their letters at our numerous offices, than they are now accommodated at the remote and inconvenient places provided for them by the government, and in all respects we could much better handle the mails than the post-office, as now located and generally conducted, could manage the telegraph.

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MR. WASHBURNE’S PROPOSED EXPERIMENTAL LINE.

Mr. Washburne says:—

“In the present position of the finances of the country, it would hardly be wise to enter upon an extended experiment. It should be tried at first on a limited scale, and at small cost. If it proves successful, and becomes what the telegraph under other government control has become in other countries,—a source of revenue, as well as an inestimable boon to the community,—it ought to be, and doubtless will be, extended. The amount necessary to construct a suitable line from Washington to New York, and to sustain it until it becomes self-sustaining, will not exceed $75,000, and it is the belief of experienced telegraphers that, with a tariff of charges as low as that of Belgium and Switzerland, and with an additional charge of single postage upon each message, the line would be self-sustaining from the beginning, and would probably repay its entire cost long before the value of the structure was materially impaired.”

The results of lowering tariffs for telegrams to a point approximating the charge for letter postage has been tried so often in this country, as not to require a new demonstration. The following statement will show the result of a recent trial between the two important cities of Chicago and Milwaukee.

On the 12th of August, 1867, a rival line was opened between those two points, having no connection with any other at either end. The competition, therefore, was for local business only. The tariff previously had been sixty cents. The average number of messages transmitted per day for the ten days preceding the beginning of business by the new company was sixty-nine, and the daily receipts fifty-five dollars. On the opening of the rival line the rate was reduced to forty cents, and the average number of messages sent by both was eighty-seven, the receipts forty-seven dollars. On the 16th September the rate was further reduced to twenty cents, with the following results: Average number of messages per day for both lines, one hundred and thirty-three. Average receipts, thirty-seven dollars. On November 8th the rate was reduced to ten cents, and remained so for the next fourteen days, during which the number of telegrams transmitted daily by both lines was one hundred and sixty-seven, and the average receipts twenty-six dollars.

About the 20th November the rates were advanced to forty cents, by mutual agreement, and afterwards the lines and records of the new company came into our possession.

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No. 1.

Statement showing number of Messages sent between Chicago and Milwaukee for first twelve days in August, 1867, at a Tariff of sixty cents, and same for 1868, at a Tariff of forty cents, together with daily Receipts.

DATE. August, 1867. Tariff 60 and 4. August, 1868. Tariff 40 and 3.

Sent. Received. Receipts. Sent. Received. Receipts.

August 1 41 48 $67.40 49 37 $39.64

„ 2 31 38 57.00 4 2 1.87

„ 3 36 25 49.63 53 42 58.25

„ 4 2 1 1.78 69 39 53.02

„ 5 41 34 55.98 46 41 43.36

„ 6 41 40 63.39 67 46 54.60

„ 7 42 49 73.77 51 39 42.44

„ 8 45 27 55.75 56 50 52.08

„ 9 39 38 61.68

„ 10 40 40 63.91 52 44 47.30

„ 11 62 42 51.70

Totals 358 340 $550.29 509 382 $444.26

1867, Average, 69 Messages $55.00

1868, Average, 89 Messages 44.42

No. 2.

Statement showing number of Messages transmitted between Chicago and Milwaukee, over the Western Union Independent Telegraph Lines, from August 12th to August 26th together with the daily Receipts.

DATE. Tariff 40 and 3.

W. U. and Independent. August, 1867. Western Union. August, 1868.

Sent. Received. Receipts. Sent. Received. Receipts.

August 12 33 47 $52.96 44 42 $47.82

„ 13 35 52 66.35 49 38 50.11

„ 14 35 50 59.00 54 42 53.35

„ 15 44 46 55.27 52 41 48.28

„ 16 34 45 53.61 1 .52

„ 17 38 45 62.38 58 52 63.21

„ 18 2 2.02 45 33 45.69

„ 19 45 51 70.45 40 45 52.39

„ 20 41 50 68.51 47 44 64.77

„ 21 39 46 62.67 54 40 50.22

„ 22 37 39 49.42 48 38 46.77

„ 23 39 41 52.97 3 2 2.21

„ 24 30 33 56.15 43 45 59.57

„ 25 2 2.10 54 66 73.26

„ 26 63 41 55.31 48 57 62.89

Totals 515 588 $769.17 640 585 $721.06

1867, Average, 73 Messages $51.28

1868, Average, 81 Messages 48.07

49Statement No. 1 exhibits a comparison for the first ten days of August, 1867, before the opening of the rival line, and when the tariff was sixty cents, with the same period in 1868 after the tariff had been forty cents for nearly a year. Statement No. 2 makes a similar comparison between the aggregate business of the Western Union and the competing line for the first fifteen days after the latter opened in 1867, and the same period in 1868, when, although the rate was the same, there was no competition. By Table No. 1 it appears that, at a tariff of sixty cents, the number of messages per day last year was sixty-nine, and the receipts therefor fifty-five dollars. That during the same period this year, at a reduction of one third in the tariff, there was an increase of about thirty-three and one third per cent in the number of messages, but a loss in revenue of twenty per cent. In other words, our work has been considerably increased, and our compensation therefor sensibly diminished. Statement No. 2 shows that last year, under the stimulus of active competition, and a reduction in rates of one third, the average number of messages per day for fifteen days was but four more than for the ten days next preceding. It also shows that, after the reduced rate had been in operation a year, and, notwithstanding the fact that the telegraph business in all sections of the country in the month of August this year was somewhat larger than last, the average had been increased but eight messages per day, and this increase was attended by a loss of over three dollars per day in the revenue.

From September 1 to November 3, 1868, the number of messages transmitted per day between these places was one hundred four and a quarter, and the average daily receipts $56.41.

On the 4th of November another rival line was opened between Chicago and Milwaukee, but no change in rates was introduced until the 24th of November. The average number of messages transmitted per day by the Western Union Telegraph Company between these places, from the 4th to the 23d of November, inclusive, was seventy-eight, and the daily receipts $43.27.

On the 24th of November the rates were reduced to twenty cents per message, with the following results: Average number of 50messages transmitted per day between Chicago and Milwaukee by the Western Union Telegraph Company, sixty-eight; average daily receipts, $24.59.

It should be remembered that the business from which these exhibits are derived is between two of the most important inland commercial cities in the country. Both are largely interested in two important branches of commerce,—grain and lumber; and probably no other points could be selected from which more reliable results could be obtained.

The reason why the Chicago and Milwaukee table is the only one given to show the results of competition is, that such comparisons are only valuable when they exhibit the effect upon the business of both competitors. This is impossible in other cases, because our opponents will not furnish us with their figures. We have written to every Telegraph Company in the United States for such statistics for publication, but none of them has responded to our request.

LONDON DISTRICT TELEGRAPH COMPANY.

We copy the following official statement of the London District Telegraph Company from the Telegraphic Journal, London, July 30, 1864. The capital of the company is £60,000, and the average cost of telegrams transmitted over its lines, for distances that cannot exceed ten miles, was 6d., equal to eighteen cents in our currency, and yet the loss in four and a half years’ business was £9,573 3s. 7d.:—

Half-year ending Number of Messages. Receipts for Messages. Expenditures. Deficiency.

£ s. d. £ s. d. £ s. d.

June, 1860 26,155 550 19 11 2,282 10 7 1,326 2 4

December, 1860 47,365 1,058 19 2 3,294 0 6 2,168 1 7

June, 1861 64,785 2,137 1 7 4,394 12 3 2,177 11 4

December, 1861 77,939 2,592 15 10 4,663 5 4 1,995 13 7

June, 1862 123,280 3,956 4 8 5,077 17 11 1,077 15 4

December, 1862 124,222 3,999 3 2 4,958 4 2 894 0 4

June, 1863 129,710 4,216 6 11 4,721 1 3 440 9 4

December, 1863 131,216 4,326 4 0 5,125 9 4 796 15 4

June, 1864 152,795 4,802 10 0 4,863 17 10 60 12 0

51The Directors of the above company express much satisfaction in being able to present to the shareholders so favorable a statement of its business; but it strikes us that a system which entailed a net loss of one sixth of the capital invested in a little over four years is not a desirable one for imitation.

TELEGRAPHS UNDER GOVERNMENT AND PRIVATE CONTROL COMPARED.

The assertion that the Telegraph facilities are better in those countries where it is under governmental control than in those where it is left to private enterprise is entirely erroneous, as the following tables, compiled from official data, will show.

Statistics of Telegraphs constructed and operated under Government Control.

NAME OF COUNTRY. Number of Offices. Number of Miles of Line. Number of Miles of Wire. Number of Messages Sent. Population. Proportion of Offices to Population.

Austria 851 24,618 73,854 2,507,472 39,411,309 1 to 46,311

Belgium 356 2,187 6,146 1,128,005 4,984,451 1 to 14,000

Bavaria 2,115 4,945 4,541,556

Denmark 89 2,515 308,150 2,468,713 1 to 27,000

France 1,209 20,628 68,687 2,507,472 38,302,625 1 to 31,600

Italy 529 8,200 20,120 1,760,889 25,925,717 1 to 49,000

Norway 73 269,375 1,433,488 1 to 19,000

Prussia 538 18,386 55,149 1,964,003 17,739,913 1 to 33,000

Russia 308 12,013 22,214 838,653 68,224,832 1 to 221,000

Switzerland 252 1,858 3,717 668,916 2,510,494 1 to 10,000

Spain 142 8,871 17,743 533,376 16,302,625 1 to 109,000

4,347 98,876 275,090 12,486,311

Statistics of Telegraphs constructed and operated under Private Control.

NAME OF COUNTRY. Number of Offices. Number of Miles of Line. Number of Miles of Wire. Number of Messages Sent. Population. Proportion of Offices to Population.

Great Britain and Ireland 2,151 16,588 80,466 5,781,189 29,591,009 1 to 13,714

Dominion of Canada 382 6,747 8,935 573,219 3,976,224 1 to 10,400

United States 4,126 62,782 125,564 12,386,952 31,148,047 1 to 7,549

6,659 86,117 214,965 18,741,360

Thus it will be seen that Continental Europe, where the telegraphs are under government control, furnishes but 4,347 offices 52for a population of over 250,000,000, while Great Britain, the Dominion of Canada, and the United States, where telegraphy has been left to the control of the people, untrammelled by governmental interference, monopoly, or restriction, furnish 6,659 offices for a population of 64,000,000! The number of telegrams transmitted per annum in Continental Europe is only 12,486,311, while there were sent by the people of the three countries where it has hitherto been free from government repression, 18,741,360. The tariff of charges in Continental Europe averages eighty-one cents per message, while in the three countries where the people manage the business it averages but fifty-one cents.

Private enterprise alone laid the submarine cables through the Persian Gulf and Mediterranean Sea, across the Gulf of St. Lawrence, the Vineyard Sound, the Strait of Florida, the English Channel, the North Sea, and the German and Atlantic Oceans.

THE TELEGRAPH AND THE PRESS.

In nothing, perhaps, is the superiority of private enterprise over governmental control more strongly marked than in the extraordinary amount of news furnished to the press of the United States, as contrasted by the meagre supply of the European journals.

By a system of co-operation among the newspapers of the United States and the Western Union Telegraph Company, the news of the world is daily furnished to the people of every portion of this country at a price within the reach of the poorest citizen.

On page 8 we have shown that 294,503,630 words are annually furnished to the newspapers of the United States, at an average cost of less than two mills per word. This immense amount of matter is not transmitted to each newspaper separately, but through a combination of wires only possible to a vast system like that owned by the Western Union Telegraph Company, it is sent to a large number of places simultaneously, with only one transmission.

The newspapers of the United States are associated together on the co-operative system. There is a general association having its headquarters in New York, which collects news from every part 53of the world; and there are local associations in every section of the country, which furnish their quota of intelligence to the general association, and receive in return such news as they require.

As an illustration of the manner in which this service is performed, we will take the State press of New York for an example. The report is compiled by the agent of the Association for the various editions of the newspapers requiring it, and it is then handed to the telegrapher, who with the manipulation of his magic key transmits it simultaneously to Poughkeepsie, Hudson, Albany, Troy, Utica, Syracuse, Auburn, Elmira, Binghamton, Owego, Rome, Oswego, Rochester, and Buffalo, New York, to Rutland and Burlington, Vermont, and to Scranton, Pennsylvania. These stations are not all on a single wire, nor on the same route, and the question may be asked, How can they all receive the same information from a single impulse? This is accomplished by a combination of circuits through an instrument called a repeater, by which the intelligence can be transmitted to a thousand offices as easily as to one.

The news is sent to the Eastern press in a similar manner. The manipulation of the key at New York transmits the report simultaneously to Bridgeport, New Haven, Hartford, Waterbury, and Norwich, Conn., Providence, R. I., and to Springfield, Worcester, Boston, Fall River and New Bedford, Mass.

The operator at each of these places receives the reports by the click of the instruments,—reading by the sound of the armature,—and with an agate pen copies them upon manifold paper, making as many impressions as are necessary to furnish each paper with a duplicate copy.

Direct wires carry and bring news from and to Chicago, Cincinnati, St. Louis, Washington, New Orleans, Plaister Cove, and other important points. Sixteen wires work out of New York every night to transmit or receive news reports, and all over the United States the ubiquitous iron threads are permeated by the subtile and invisible fluid during all the silent hours of the night, conveying intelligence of passing events in all sections of the civilized world for publication in the morning journals throughout the country.

It is a singular and suggestive fact, that the amount of news 54which we furnish to the press of the United States, for an aggregate sum of $521,509, is considerably greater than the entire telegraphic correspondence of Continental Europe, for which the paternal governments of those enlightened and enterprising peoples receive $11,597,632.71.

The following table will serve to show the remarkable contrast, in this respect, between the systems under government and private control. The number of messages delivered to the press are obtained for this comparison by dividing the total number of words furnished to the press by 20, the European standard:—

Statement showing the Average Cost of Telegrams in Continental Europe and the Average Cost of Press Telegrams in the United States, with Total Amount of each per annum.

Total number of messages transmitted in Continental Europe for the year 1866, 12,902,538 Total number of messages furnished to the newspapers of the United States for 1866, 14,725,181

Gross receipts for the above, $11,597,632.71 Gross receipts for the above, $521,509

Average cost of telegrams in Continental Europe, 81 cts. Average cost of press telegrams in the United States, 3½ cts.

The above exhibit illustrates the difference between what can be accomplished under a popular government which leaves the press and telegraph free and untrammelled, and the results of the paternal system which the governments of Continental Europe impose upon their subjects. For these great benefits the people of this country are indebted to the government for the one negative quality of letting the press and telegraph alone. For the positive quality which actually provides them they are solely indebted to the enterprise and public spirit of the press, and the Western Union Telegraph Company, the latter furnishing the reports at a price which barely covers the cost of service employed in transmitting them, and leaving nothing to defray the expense of the wear of the lines, or interest on the investments for their construction.

In no other country in the world is there such a system, and in none can there ever be, until the policy of our government is imitated, and the people left to manage their own private affairs, leaving the press and the telegraph free and untrammelled by 55governmental control or repression. What our government, with such an example already set, might be able or disposed to do, in the event of its monopolizing the telegraphs, it is impossible to say; but it is unquestionably true, that no other government has ever made such a use of them to promote the education and general well-being of its people.

We believe it would prove a serious misfortune to the press and the people, if the government were to destroy, by its interference, this admirable co-operative system of obtaining telegraphic news at such low rates.

The tariff for special press reports is as follows: For the first one hundred words, full rates; for the next four hundred words, a discount of thirty-three and one third per cent; for the next five hundred words, one half the ordinary tariff; and all over one thousand words, a discount is made of sixty-six and two thirds per cent.

Mr. Washburne’s bill provides for a general tariff of one cent per word for telegrams, with an additional charge of three cents for postage, and two cents for delivery, and stipulates that a reduction of not more than fifty per cent shall be made for press reports. This rate would increase the average cost of news for the press of the United States more than three hundred per cent, and thus the newspapers would be compelled to pay an extra tax of a million dollars per annum for the privileges they now enjoy.

If these facts show any results to warrant governmental assumption or interference in the business of telegraphing, we fail to perceive them.

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