Germany.— Railways in Germany grew up very much as they did in England, at first with out any general plan and without any real comprehension or appreciation of the problems involved. The Germans, however, like the Eng lish, seem to have started right on the question of competition. Their earliest statutes explicitly recognized the right to a monopoly in their first lines. The country then consisted, aside from the central kingdom of Prussia, in large part of a number of semi-feudal principalities, and local railway system sprang up in each of the states, which in 1914 constituted the German Empire, so-called. Prussia followed Belgium in a general way in her early legisla tion and initial construction. The first state railway in Germany was built in Prussia about 1848-50, from Berlin toward the Russian frontier. Other state lines followed, but psi passu, many private lines were laid down, some of them securing some state aid, by way of guarantees or subsidies or stock subscriptions from the principal states. Some, however, even of the smallest principalities, at first owned their lines outright and operated them too. So there was at the start every sort of a railway in Germany. This haphazard and piecemeal work begot the inevitable result — fierce com petition everywhere among the private corn panies and between them and the state roads. The results were extremely dissatisfactory; the service was poor and the rates high. About 1861 Bismarck came into power, and from that time dates the influence of militarism upon the railway system of Germany. It has since shaped and colored the whole development and opera tion of the German lines. He saw clearly enough that the mixed and competitive system was a bad one, not only from a military point of view, but also from the point of view of the country at large. Steps were, therefore, grad ually taken, in Prussia especially, to acquire the private lines and to consolidate competing and conflicting interests. The matter moved slowly because the country was poor, but the mileage nearly doubled between 1865 and 1875. After the war with France in 1871, more rapid prog ress was made in unifying the railway system of the country. By 1878, there were about 3,000 miles of state-owned and operated lines, 2,000 miles of privatelrowned and state-operated lines, and about 6,000 miles of privately-owned and privately-operated lines. In 1881, the government owned more than 7,000 miles of line, only about 3,000 miles remaining in the hands of private companies. In 1885, the government owned 13,000 miles of line in Prussia alone while only 1,000 miles remained in private hands. In 1900, there were 30,597 miles of railway in the German Empire, more than 93 per cent of which were owned and operated by the state. In 1913 the total mile age was 37,894, of which 2,205 miles were private lines. The increase since 1900 consists almost exclusively of lines constructed for military reasons mostly on the western fron tier facing France. Under the law the government was required to manage the rail ways °in the interest of general traffic as a single system,o and in 1886 the government issued a Code of Railway Regulation, applicable to the whole railway system of the country. Competition practically ceased in Germany by about 1875, and for the past quarter of a century the railways of the country have been operated on non-competitive lines. Pooling arrangements with the canals and other competing waterways are sanctioned, in order fully to eliminate waste ful competition and unjust discrimination.
Austria.— In 1912 Austria had 14,185 miles of railways, of which 863 miles were narrow gauge and 2,501 were private lines; Hungary has at the same time 13,303 miles of lines, of which 2,098 were private lines. In 1901, Austria Hungary had only 39,014 kilometers of line open for traffic. The first Austrian charter was granted in 1836, and construction went on actively thereafter until the revolution of 1848. The original idea was to follow the French system, and have the lines built and operated by private companies. Their statute of 1838,
it may be noted, was the first general railway law enacted in any country in the world. It provided for undertakings by private companies, and for guarantees by the state of interest upon the cost of construction; it limited dividends on shares to 15 per cent, and absolutely pro'hib ited the construction of paralled lines. It was discovered, however, as time ran on, that the French system was not well suited to the con dition of things in Austria; and in spite of statutory prohibition, as the lines were con structed and put into operation, competition ran riot. There was also the usual iniquity grow ing out of constructing lines for a chance to speculate in the securities; and the competition of the waterways — of the Danube and the canals — although pooling between them and the railways was allowed and encouraged, added to the confusion and disorder of private management. So in 1873, Austria fell into line with the other countries of Europe, and started off in the direction of state ownership and con trol. In 1885, about three-quarters of the mileage in Austria was, however, still in the hands of private companies, but all the lines in Hungary were at that time owned and operated by the state. By 1898, more than half of the Austrian lines were under state management, and the tendency sets more and more in that direction.
Russia.— In 1910 Russia (including Russia in-Asia) had 41,622 miles of completed railway, not including Finland with 2,039 miles of line, and 8,000 miles under construction, including the great Trans-Siberian line, winch is the greatest railway enterprise yet undertaken any where. Work began on this line in Mardi 1891, and it is now open for traffic. The esti mated cost is about $500,000,000. The distance all rail from Paris to Port Arthur or Vladi vostok is about 7,000 miles, with a through-car service from la Garr du Nord to Port Arthur and Peking. The government furnished a large part of the capital required for construc tion, and owns and operates about two-thirds of the total mileage in European Russia; it has in addition subsidized and thus controls and dominates the policy of the lines owned and operated by private companies.
The Minor Countries of Europe.— Else where in Europe we find the same variety in railway operation and control as in other things; but the tendency everywhere is to government ownership or to such a strict government regulation as effectually eliminates anything like competition between the lines. Thus in Norway, in 1915, there were reported 1,948 miles of line, all now owned and operated by the government; whereas in Sweden, at the same time, there were 8,984 miles of line in. operation, of which only 2,392 were government lines. But although in 1893 there were re ported to be not less than 108 different owners of private lines in Sweden the law strictly and successfully prohibits competition between them, or between them and the state lines. The last available figures for the Spanish lines show 9,517 miles open for traffic in that country, all, as in Portugal, owned by private companies, but supported and controlled by the state. In Switzerland, where in 1915 there were 3,148 miles of line in working order, the gov ernmental supervision has until recently been much the same as in Spain. In 1898, by popular vote, it was determined (in view of the evils of over-construction and some hurtful competition in spite of legislative prohibition) to purchase for the government the five chief lines, thus putting Switzerland in the Belgium class of countries owning and operating their railway lines. This scheme was gradually financed and carried out by the Swiss government. The railway history of these relatively unimportant European coun tries is of much less interest and value to us than that of the greater states. The Italian system has been followed substantially in Holland, and in Denmark, and by some of the other minor Scandinavian countries.