The system developed by the United States Interstate Commission has been followed, so that the invaluable statistics published by them may be quoted and freely applied to illustrate general principles. Until 1908 the various items were grouped into four general classes. In that year the system was expanded by dividing the expenses of "Conducting transportation" into "Traffic expenses" and "Transportation expenses" and also by increasing the number of sub-items from 53 to 123. Since that time changes in classification have altered the number to 116. At the same time, realizing that small roads with light traffic have little or no use for many of the smaller sub-items, another classification of 44 sub-items was made for the "small roads." This arbitrary division is as . follows:

"Large roads"; those with mileage greater than 250 miles, or those with operating revenues greater than $1,000,000. Roads subsidiary to "large roads" are also included in this class.

"Small roads"; those with mileage less than 250 miles and also with operating revenues less than $1,000,000.

Although the gross amounts of revenue and the expenses for nearly all items have been almost uniformly increasing with each year, the percentage of the various classes of expenses have varied in a manner which is instructive. The average value given is the average for the thirteen years from 1895 to 1907 inclusive.

Average value.

1.

Maintenance of way and structures ......................

20.77%

This value has varied from a minimum of 19.52% in 1904 to 22.27% in 1901. There seems to be no constant tendency to either increase or decrease.

2.

Maintenance of equipment ....................

18.72%

This has almost steadily increased from 15.76% in 1895 to 21.40% in 1906. The increase in gross amount is very large.

3.

Conducting transportation............................

56.30%

Although the gross amount of this item has been largely increasing, the percentage has been decreasing with almost uniform regularity from 59.46% in 1895 to 54.43% in 1906. Since 1907 there has been a continued decrease if we take the sum of "traffic expenses" and "transportation expenses." The increase in percentage of maintenance of equipment, and the almost equal decrease in percentage of conducting transportation, indicates the demand for a better grade of equipment.

4.

General expenses ..............

4.21%

These percentages varied from a maximum of 4.76% in 1897 to 3.74% in 1907. There seems to be a general tendency toward a decrease.

100.00%

Since the adoption of the new system the percentages have been as follows:

Operating expenses.

1908.

1909.

1910.

Maintenance of way and structures. .

19.73%

19.29%

20.22%

Maintenance of equipment.........

22.06

22.75

22.66

Traffic expenses .............

2.89

3.08

3.07

Transportation expenses .............

52.01

50.90

50.29

General expenses ...................

3.31

3.98

3.76

100.00

100.00

100.00

50. Average Operating Expenses Per Train-Mile

The reports published by the Interstate Commerce Commission give the operating expenses per train-mile for nearly all of the railroads of the country. In fact the omissions are almost exclusively those of the very insignificant railroads on which the bookkeeping and tabulating of expenses is not kept up with sufficient accuracy to furnish such figures. The very surprising feature of these figures is that the operating expenses per train-mile are so nearly uniform, for the various roads of the country for any one year. Although there are numerous instances where the average cost of running a train per mile over any one road has a large variation from the average figure for the whole United States, it will be found that the cases of very large variation are comparatively rare, and it will also be found that when the variation is very large there is usually some abnormal operating condition which accounts for the unusual value. The average cost of running a train one mile for the whole United States, as given for each year, is given in Table VII. The variation is shown graphically in Fig. 6.

Table VII. Average Cost Per Train-Mile For Whole United States - 1890-1910

Year.

Average cost per train-mile, cents.

1890

96.006

1891

95.707

1892

96.580

1893

97.272

1894

93.478

1895

91.829

1896

93.838

Year.

Average cost per train-mile, cents.

1897

92.918

1898

95.635

1899

98.390

1900

107.288

1901

112.292

1902

117.960

1903

126.604

Year.

Average cost per train-mile, cents.

1904

131.375

1905

132.140

1906

137.060

1907

146.993

1908

147.340

1909

143.370

1910

148.865

The enforced economies following the panic of 1893 brought down expenses to the low point given for 1895.

From this point the rise has been almost steady, until the annual cost is nearly 50% higher than in 1895. This has been partly due to an increase in wages and salaries, and partly due to the increased cost of fuel and supplies; but in spite of this increase, the uniformity between roads of various amounts of traffic is still remarkable. In Table VIII are given values showing the operating expenses per train-mile for ten of the largest railroad stsyems in the country, and also for ten small roads whose mileage is less than 100 miles. The table, as printed in the first edition, gave only the figures for 1904. By retaining these and adding those for 1910, an instructive comparison is possible. The ratio of expenses to earnings in general remains very uniform for all large roads and there is even a tendency for the several large roads to retain their relative order in this respect. The operating expenses per train-mile have almost uniformly increased in gross amount except in the case of the more erratic small lines. A remarkable instance of an erratic change is the Huntingdon & Broadtop Mt. R.R., which in 1909 had operating expenses per train-mile of $1,221 and an operating ratio of 63.87%. The use of these figures instead of those for 1910 would make the average expenses per train-mile for the ten small roads less rather than more than the general average.

Average cost per train mile in cents.

Fig. 6. Average cost per train-mile in cents.