h more than the market
value of all the railway bonds and shares in existence."

The above quotations from Mr. Davis' article hardly do it justice, and
it should be read in full to appreciate its full force. Many of the
predictions and estimates are undoubtedly in the main correct, yet upon
the whole it must be admitted that it is a rather rosy and too hopeful
view to take of Government ownership of our railroads.

_4. State ownership with private management._

This is a compromise between a public and a private system of railway
ownership and management. It is claimed by the advocates of this system
that if the Government would acquire by purchase or through condemnation
proceedings all of the railroads of the country, pay for them by issuing
its bonds, and then lease the various lines to the highest responsible
bidders, prescribing a schedule and rules of management, most of the
benefits resulting from state ownership of railroads could be secured
while nearly all its disadvantages would be avoided. It is proposed to
purchase railroads at their actual value and to issue in payment bonds
bearing the same rate of interest as other Government securities. This
would deprive managers of every opportunity to manipulate the railroad
business for purposes of stock speculation. It would also reduce the
fixed charges of our railroads at least 50 per cent., the benefits of
which reduction the public would chiefly share. The acquisition of the
railroads by the Government would, moreover, afford the conservative
capitalist a safe and permanent investment, which, with the gradual
disappearance of our war debt, might become a national desideratum.

It is proposed by the advocates of this system that the Government fix
rates of transportation for a certain period, to be reviewed at the end
of that period upon an agreed basis. The operating companies would be
required to keep their roads in repair and give sufficient bonds for the
faithful performance of their contracts. If found guilty of persistent
violations of the terms of their leases or of such laws as Congress
might enact for their control, their bonds and leases might be declared
forfeited. A new Government department or bureau would have to be
established and charged with the duty of exercising the same control
over railroads which the Government now exercises over national banks,
and in addition to this complete publicity of the service would have to
be relied upon