two-thirds of the Swiss people that it would be best to nationalize the railways? Had they suffered from the abuses that mar our railroad history? Had the railroads dominated their governments, state and national, built up giant trusts and monopolies by discriminating rates and transportation favoritism, compelled the people to pay dividends on watered capital, and seriously disturbed the fair distribution of wealth? No; the most vital railroad abuses we suffer from were practically unknown in Switzerland. There was no fraudulent stock, no rebate system, no railroad lobby at the national capital. The best-informed authorities in the universities, and even Dr. Zemp, the Minister of Railways, never heard of a case of discrimination; and political corruption had been very rare.

Professor Borgeaud, one of the foremost authorities in Switzerland, was inclined to think, when I first put the question, that the railways had not been guilty of bribing legislators or exerting corrupt influence on legislation through lobbies or otherwise, a fact which is due, it is said, to the existence of the referendum, which makes it practically useless to spend money for corruption, since a moderate percentage of the people may demand a vote on the franchise or other measure and give the voters a chance to turn it down at the polls in spite of boodle legislation. Afterward, however, the professor called my attention to one case, "the only one he knew of," where the vote of the Canton of Vaud was necessary to the fusion of the Jura Berne and the Swiss Occidentale under the Simplon Company. The Canton owned a lot of the railway shares and nothing could be done without its vote. Vesser, a man of great political influence, was offered an option on a block of stock, if he would carry the measure. The offer was worth about 30,000 francs to him. He took it and carried the bill, which, apparently, was not against the public interest anyThe bribe became known, and within three days Vesser had to resign

his office, a result "brought about by the moral pressure of his friends and the public and by the bombardment of the press, the papers of his own party joining in the attack."

The Government from early years had exerted a strong control over the railways. Under the law of July 28, 1852, charters were granted by the Cantons, but must be approved by the Federal Assembly. The railways must carry the mail, including the parcels-post, free of charge; also the "railway-post officers" and postal clerks must be transported free. Soldiers and accoutrements of war must be taken at one-half the lowest regular rates. Special regulation was left to the Cantons or States.

In 1872 the Bundesrat submitted a new law, with a report characterizing as “a specially great evil the inability of the individual Cantons to assert their authority against the greater railway companies," which had resulted in difficulties over the establishment of new lines or their transfer, the regulation of rates and time-tables, and “the arbitrary action of the companies in cases of liability."

The railway law of December 23, 1872, subjected rates to the complete control of the Federal Government, and opened to Federal inspection all acts and contracts relating thereto. A time-limit was placed on the corporate life granted in the charters, and franchise rights were made transferable only with Federal consent. Railways were required to submit a detailed and accurate account of the expense of construction. The Government reserved the right to order the establishment of stations, double tracks, and other facilities. The provisions as to free carriage of the mails were reënacted. An annual franchise tax in proportion to net profits was provided for, and many other important points were covered.

These and other laws that will be referred to, together with the repurchase provisions of the charters, held the railways pretty well in check as compared with ours.

Still there were plenty of reasons for the change to government ownership which seemed convincing to the Swiss. They believed that it would be better for the people to have the roads owned and operated by the public for the benefit of the public, than to have them owned and operated by private corporations for the benefit of private stockholders. The battle was fought on the broad principle of the superior social, economic and political value of public ownership of public utilities, as compared with private ownership even when honest and efficient. In the great discussion that filled the country to the brim, one of the winning strokes was the posting in the inns and public places all over the country the ringing words:

"The Swiss Railways for the Swiss
People.'

This became the motto of the movement with the common people and had much to do with the big vote of more than 2 to 1 in favor of the measure.

From the argument of the Message to the Federal Assembly already referred to, and from conversations with the heads of government departments, including Dr. Zemp, the author of the nationalization law and the first Minister of Railways under it, and Emile Frey, ex-President of the Republic and head of the International Bureau of Telegraphs and Telephones, and a large number of business and professional men in Geneva, Berne, Basle, and Lucerne, I condense the following statement of the main reasons that led to the nationalization of the railroads: 1. "The railways should be managed for the people, not for the profit of private owners. This point in varying forms was emphasized over and over again as the fundamental argument and the basis of the movement.

2. "The rates would be lower."

3. "The service would be better. The Government would be more occupied with the interests of the public than the company's."

4. "Considerable economies will be effected by the consolidation of the roads under public management."

5. "Unity of the system is essential to the best results, and the united system must not be subject to speculative manaagement."

6. "The private operation of railways puts too much power in the hands of the managers.'

7. "The Nation would be better able to open new lines where they are needed. The companies do not develop the outdistricts. They have refused to build new railways to villages where they think the business may not pay, although there is great need for the roads."

8. "In their pursuit of dividends the companies have sometimes even neglected proper repairs and precautions for safety, so that bad accidents have resulted."

9. "The Government will be more liberal with employés than the companies, as is shown by its treatment of the employés of the Government post and telegraph. It will adjust differences with employés in a better spirit, and we shall not have strikes of railway employés blocking our traffic."*

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10. We do not want our railways owned by speculators, and especially we do not want our railway shares owned by foreign capitalists."

11. "The capital of the railways should

*There had been a great strike on one of the railroads, the Swiss Northeast, in 1897, which helped to convince the trades unions of the necessity of public ownership. The men won the strike and got the increase of wages they demanded, but they did not like the attitude of the companies nor the methods they were compelled to resort to for the settlement of difficulties. Guyer Zeller, president of the Swiss Northeast, used his power despotically, and a large body of people were heartily sick of the high-handed arrogance of the Northeast management. This little experience of what a bad manager might do, and the inconvenience and injustice of the railway strike as a means of settlement convinced many beside the workingmen that some better method than corporation management was necessary. I was told with great emphasis that "for two whole days the entire traffic of the Northeast Railroad was stopped, and the business of the public blocked." I wondered what these people would think of one of our giant strikes when business is blocked for weeks.

be gradually extinguished instead of being piled up, as the companies are doing. Provision has been made in Germany and Belgium for the amortization of the capital about the middle of the twentieth century, and the French railways are to come to the State free of debt about that time. We also must extinguish the capital charges on our railways, so that rates may be reduced as nearly as possible to the cost of operation."

12. "National ownership of the railways will tend also to a closer national unity. This is important, for by reason of differences of race, etc., the union of interests among our States is none too strong."

13. "The success of the German roads affords a strong example of the value of State ownership." "We are all convinced," said one of the foremost men in Switzerland, "that State management of railways has been a good thing for Germany."*

The farmers were for nationalizing the railroads. They complained of inferior service and high rates on agricultural products. They objected to stock speculation and to the holding of Swiss railroad stock by foreign investors. Capitalists, not only in Switzerland but in Germany, Austria and France, speculated in Swiss securities, and the common people held, as stated to me by one of their leaders, that "financiers have no irght to speculate with interests of a national character." The Farmers' Alliance was for the purchase, and the trades unions, including the powerful union of the railway employés, were for it. Several of the most prominent labor leaders of the country told me that fully three-fourths of the workingmen voted for the law. Commercial and business

*Although the nationalization of railways in Prussia was most frequently referred to, the movement in other countries helped to convince the Swiss. Belgium after long trial of both public and private roads had adopted in 1870 the policy of State railways, and had made a decided success of it. Austria, which at one time sold its roads under the stress of financial need for military necessities, had

interests were largely for it, also, and the President of the Swiss Union of Commerce and Industry wrote a strong pamphlet in favor of it.

The opposition was mainly of two sorts, capitalistic and racial. The capitalistic opposition did not expend its strength wholly in argument. Tremendous pressure was brought to bear upon employés and others more or less dependent on the owners and managers of the railways and allies, to prevent the signing of petitions for the referendum and voting for the measure at the polls. The strongest adverse influence, however, was the opposition of the French-Swiss to any further additions to the power of the National Government. The FrenchSwiss constitute about one-third of the population and the German-Swiss twothirds. Increase in the power of the central Government means an increase of German preponderance and awakens French opposition. The French also are naturally more individualistic and less inclined toward public enterprise than the Germans. In some of the smaller Cantons the objection to centralization was very strong even among the Germans because they feared it would increase the relative importance of the big Cantons, Berne and Zurich.

Party politics was practically eliminated from the discussion. Dr. Zemp, the leader of the Conservatives, joined with the Liberals in demanding the transfer of the railroads to public ownership, and the nationalization act was drawn by him and supported with all his power. So it was easy for Conservatives to join with the Liberals in voting for the law, and party prejudice was a very small factor in the result.

In the charters of the roads and the

returned to State ownership, and by the law o December 14th, 1877, inaugurated a new epoch of State railways. States bordering Switzerland on the north-Bavaria, Wurtemburg, Baden-and other German States had successfully operated their railways for many years. All these things had their influence on Swiss thought.