II.

The same questions may be taken up in detail by the help of statistics. I take the figures for increased mileage, net earnings, etc., for the railroads in the four granger states, and compare these figures with similar figures for the railroads in the other states. These figures are all taken from Poor's Manual; and since they have been furnished by the railroads themselves at the period investigated, they cannot be open to any criticism as being unfavorable to the railroads. In fact the many quotations in the first part from railway officials as to the evil effects of the granger legislation make it evident that if bias has influenced the figures of the railway reports, this bias has been against the granger acts. Therefore, if the figures have erred at all they must have erred in exaggerating the injuries to the railroads during the granger period.

Realizing how often a superficial use of statistics may give misleading results, I have in this investigation followed out all suggestions and made all combinations that might conceivably lead to results of a different character. The fact that all such results have practically agreed in all important particulars seems to warrant submitting them in comparison with the results drawn from the written authorities as recorded in the first part of this paper.

1. The first question is that of railroad construction, as shown by tables of increased mileage.

2. The second is that of the money loss to the railroads, as shown by the tables of net earnings.

3. As the Potter law is the worst of the granger laws, do the figures show that Wisconsin suffered more evil effects than the other granger states ?

The granger laws affected only the four states, Illinois, Wisconsin, Minnesota, and Iowa. These may be compared with other states, which should as nearly as possible have the the same conditions as the granger states in all respects except in regard to railroad legislation. After several trials I have chosen the four states, Indiana, Michigan, Nebraska, and Missouri as most nearly filling these conditions as to geographical position, area, population, assessed valuation, industrial development and railroad mileage. These states are referred to in the accompanying table as "four western states." The following Table A shows their similar conditions very clearly:

TABLE A.

A comparison of the four granger states and four neighboring western states.'

1880.

1870.

Population
in 1873 to
one mile
railroad.

3.1

483

407

54

I. I

1.3

In order to broaden the comparison as to mileage, I have included the figures for the six middle states (New York, New Jersey, Pennsylvania, Delaware, Maryland and West Virginia); the ten southern states (Virginia, Kentucky, North Carolina, Tennessee, South Carolina, Georgia, Florida, Alabama, Mississippi, and Louisiana); and for the total United States. In 1873 the railroad mileage of the four granger states was 14,627 miles, of the four western states 10,932 miles; six middle 13,643; and ten southern 12,977. These four groups had 75 per cent. of the total mileage of 70,268 for the United States. As the four western, the six middle, and the ten southern states had no railroad legislation corresponding to the granger acts, these states should show a comparatively steady, growth in railroad mileage during the granger period. If, however, these states do not show such a steady increase in railroad mileage, then the cause must be sought in something different from the granger legislation.

The last three columns of this table show that when the granger acts went into effect the four granger states had more miles of railroad compared with assessed valuation, populution and area than the four western states. Therefore, other things being equal, the railway mileage in these four western states should have increased faster after 1873 than the mileage of the four granger states. This is further shown by the fact that in the period 1873 to 1900 the railway mileage of the four western states did increase by over 149 per cent. of what it was in 1873, and the mileage in the four granger states during the same period by over 133 per cent.

In Table B I have reduced the increase in railroad mileage to percentages for ease of direct comparison. Thus, in the first column between the years of 1860 and 1870, the mileage in the four granger states increased by 133 per cent. of what it was in 1860; and in the four western only 100 per cent. The years 1874 and 1875 were the periods when the granger acts were in operation; and the results for these two years are printed in heavy type. A glance at column 5 will show that the mileage in the granger states increased 6 per cent.; that in the four western 4.1 per cent.; the six middle 5.9 per cent.; the ten southern 2.4 per cent.; and for the total United States less than 5.5 per cent. All the other figures in this table go to show that this comparison for 1874 and 1875 is not accidental, and that similar results are obtained for any combination of years that can be said to have been influenced by the agitation and acts from 1871 to 1881.

Column 1 shows the increase from 1860 to 1870, the ten years before there was any question of granger legislation. During this decade the granger states increased 133 per cent. and the four western only 100 per cent. Glancing again at the conditions in these two groups of states, as shown in Table A, it seems to me to be clear that we should expect a greater increase in the mileage in the four western states for the next decade of 1870 to 1880 than in the granger states. Especially is this reasonable, when we remember that the granger states had just increased by 33 per cent. more than the four western states. Therefore, if no granger legislation had been enacted, and the railroads had developed under normal conditions, new construction from 1870 to 1880 in the four western states should have exceeded that in the granger states. The figures of column 2 show, however, that the granger states increase 96 per cent. as compared with 90 per cent. for

the four western; 45 per cent. for the six middle; 33 per cent. for the ten southern; and 74 per cent. for the total United States.

In columns 1 and 2 it is noticeable that, while all the groups of states show a falling off in the second decade, the ten southern states, which are half way between the granger and four western in column 1 sink to hardly more than one-third of either of them in column 2. Is it not, then, natural to believe that whatever cause affected railroad building between 1870 and 1880, must have acted more strongly on these ten southern states than on the granger or four western states ? Column 3 gives the data for 1880 to 1890, a period covering years after all effects of the granger acts had passed away. As the building in the granger states for the preceding twenty years had been very large, we should naturally look for a slowing down. This we see in the 50 per cent. of the granger states compared with the 74 per cent. and 72 per cent. of the four western and ten southern. Here again the sudden increase in the ten southern, compared with the 33 per cent. of 1870 to 1880, shows that the cause of retarded railroad build

ing had affected these states with greatest severity. Also, the 74 per cent. of the four western shows that, other things being equal, these states should have built at least as fast, if not faster, than the granger states between 1870 and 1880.

Column 4 takes 1871, 1872, 1873, three years immediately preceding the granger acts. The figures for the granger and four western are almost the same, but the granger begin to show a slight tendency to slow down, as would be expected from the greater building in the earlier decade.

Column 5, as already stated, deals with 1874 and 1875, the two years of the granger acts. The 6 per cent. increase for the granger states certainly compares favorably with the 4.1 per cent. of the four western and the 2.4 per cent. of the ten southern. In short, the granger states make a better showing than any of the others, and the ten southern show the greatest loss.

Columns 6 and 7, for the years 1876, 1877, and 1878, immediately following the granger acts, show that the building in the granger states remained practically the same as in the four western. In fact, the two years right after the repeal of the acts show a little less building for the granger states.

Columns 8 and 9, for periods of five and eight years after the acts, show that the granger states more than held their own in railroad building throughout the granger period. This table, as a whole, shows

not only that the granger states had more than their natural share of railroad building in 1874 and 1875, but also for any combination of years affected by the granger legislation. This result is more noticeable when we remember that, other things being equal, the four western states should have increased at least as fast, if not faster, than the granger states.

Question 2.-Did the receipts of the railroad fall away, as shown by their net earnings? In Poor's Manual the figures for net earnings have never been as completely compiled as the figures on new mileage, and the investigation is therefore confined to the years 1871 to 1879. For a basis of comparison, I have taken the average net earnings for 1871 to 1872, the two years preceding the granger agitation. In Table C the average net earnings for 1874 and 1875, the four years 1873 to 1876, and the seven years from 1873 to 1879, have in turn been compared with the average of 1871 and 1872 and the increase expressed in percentages:

TABLE C.

Increase of average net earnings in per cent. compared with the average net earnings for two years 1871 and 1872.1

Column I shows that in 1874 and 1875 the net earnings in the granger states increased 29 per cent., which was almost double the 15 per cent. increase in the four western. This difference in favor of the granger states is still more marked for 1873 to 1876, when the figures are 31 per cent. and only 9 per cent. In column 3, the three years 1877 to 1879 are added to the preceding four years, and both the granger and the four western states leap ahead with 44 per cent. and 30 per cent. Therefore, if we take the four years 1873 to 1876, most affected by the granger legislation, the granger states held their own with the middle and southern, and increased three and one-half times as fast as the four western.

This table should not be given too much importance, since the comparison with the average of 1871 and 1872 is too narrow, but if Poor's Manual, 1874-75, p. 55, for 1871-73; ibid., 1881, p. 79, for 1873-79.