at A, and if a railroad between
these points, whose capacity is not fully utilized, can carry the
article from A to B with an expenditure of two additional units of
labor, then society can best get the goods for use at B by spending
these seven units in the making and carrying. It would take ten units
to make them at B, and to society itself there is a saving of three
units from making them at A and carrying them at a special rate to B.
Till the railroad is more fully used for other purposes this source of
economy will continue. Though the rates charged for this freight would
bankrupt the railroad if they were applied to its entire traffic, it
is best for the railroad to take this special bit of carrying at any
rate exceeding the wages of the two units of labor; and for the time
being this is the best way to use some of the social resources, since
it gives at the point of delivery and use more goods for a given
outlay than could have been had in any other way.

_Why Consumers may suffer while Particular Producers may be
Favored._--It will be seen that this principle affords an inducement
for making a special classification of certain goods and carrying them
for less than merchandise of a generally similar kind is carried for.
It is a policy of "making traffic" which costs little and is worth
more than it costs both to the carrier and to society. This incentive
for reducing charges does not operate as strongly in the case of goods
carried to consumers who are forced to live on the route. They are
held there by the general causes mentioned at the beginning of the
preceding chapter, and must pay the tax which the railroad imposes on
them. The only limit on this tax is the possibility of otherwise
procuring the goods or of moving out of the territory. The ultimate
possibility that population may not grow under a regime of extortion
and that both freight traffic and passenger traffic may be held within
small limits imposes some check on the railroad's exactions. The
company may find it worth while to foster to some extent the growth of
population; and to favor producers of certain goods in order to
induce them to locate their establishments on its line, and the result
of this may be good for society; but there is no way of securing a
general good from the heavy tax on the rest of the traffic unless this
has been necessary to insure the existence of the railroad itself. In
that case there may be a temporary necessity for it,