From the financial point of view most important result of the agreements has-been the consolidation of the companies' credit. In some instances it has made it possibI for them to borrow at lower rates than the state itself could have done. But as the increase of their capital made their indebtedness more burdensome, and on the other hand •the operation of :new lines caused a deficit, they 'were-obliged do the guarantee of interest for sums which before the conventions of 1883 amounted to 545,000,000 francs ($109,000,000), and between 1883 and 1903 rose to 951,000,000 francs ($190,203,000).
But it must be borne in mind that the amounts paid over as guarantee. of interest and which figure in the budget as expenditure con stitute in reality an investment for the state at 4 per cent secured by the rolling stock, which is of a much higher value.
Moreover, if during the years subsequent to the agreements of 1883, the annual amounts called for by the companies from the state reached 93,000,000 francs ($18,600,000) in 1893, they fell to 4,000,000 t$800,000) in 1900. The companies began to reimburse more and more, and the accounts for 1910 showed a bal ance in favor of the treasury of 5,500,000 ($1,100,000). In 1912 it only amounted to 775,000 francs ($155,000), but it must be noted that during that year the Compagnie de l'Est had also refunded to the state under a special agreement 159,000,000 francs ($31,800,000) of the capital amount of its guarantee debt. The debt of the °P. L. M.° has been settled since 1897 in conformity with special agreements, and the Compagnie du Nord has never had recourse to a state guarantee.
The accounts of guarantee of interest for the year 1912 for the principal railways are briefly as follows: It will be noticed that the Compagnie de l'Ouest does not appear in this table, having been since 1909 under the management of the state, as well as the old line: The latter showed, in 1912, net proceeds of 6,000,000 francs ($1,200,000) while the accounts of the new line show a deficit in the earnings of 96,000,000 francs ($19,200,000) .
In addition to the lines of the more import ant companies, the French railway system com prises a number of small railways which also receive a state guarantee.
On the other hand, the railway companies are a source of revenue to the state by way of taxes on transportation, on their securities, and economy on the transportation of soldiers and sailors, as well as on postal and telegraphic transit; the budget for 1912 therefore shows: expenditure, 361,000,000 francs ($72,200,000) ; receipts, 358,000,000 francs ($71,600,000).
These accounts are thus, so to speak, balanced.
To get an idea of the management of the different companies, it is not sufficient to take into account the amount of their gross receipts, we must compare it with the amount of ex penditure, which gives the figure of working coefficient, i.e., the ratio of expenditure as compared with the receipts. We now see that this coefficient, which, in 1880, was 50 per cent, has gradually increased, reaching 60.3 per cent in 1912. This figure, although lower than that of the majority of foreign companies, never theless goes to show that for various reasons the operation of railways has become more and more onerous, whereas the transportation tariff both for passengers and goods has de creased since 1830 by about 30 per cent.
On the other hand, during the last few years, the railway companies have considerably in creased their initial capital. with the especial object of making the improvements which the heavy traffic had rendered. necessary and to in crease the efficiency of the rolling-stock; the result, however, has been to greatly increase their financial obligations, entailing a corre sponding reduction in the remuneration of the capital invested, which was only 3.72 per cent in 1912.
This is certainly a point to be considered, as in view of the limited duration of the conces sions, the period of amortization of the new bonds necessarily becomes shorter.
Military Organization of Railways.•—The regulations governing the military organization of railways were laid down and determined by the laws of 1873, 1877, 1888 and by various decrees.
By virtue of these laws, a special depart ment was organized at the War Office to exam ine the operation of railways in times of peace and to take over such operation in war time. This department is called the g‘teme Bureau) and is in charge of a lieutenant-colonel, who, in turn, acts under the orders of the Chief of the Staff-office.