of collection, sorting,
etc., are so large a part
of the costs of carrying a letter, that the real cost
between John o’ Groats and Land’s End
does not differ from that between Hampstead and Highgate
by as much as might at first sight appear, (2) that
the charges in any case are very small; so that (3)
the avoidance of the small degree of taxes and bounties
which the present system implies is not worth the
book-keeping expenses which differential charges would
involve. It should be obvious that these considerations
apply to the railways with a greatly diminished force.
They might possibly justify what is known as the “zone”
system of charges,
i.e. uniform rates within
certain narrow areas. But the notion of uniform
rates throughout Great Britain conjures up a vision
of trains taking coal from South Wales to Scotland,
and others taking coal from Scotland to South Wales,
in accordance with the slightest preferences of the
consumers, and without regard to the extra real cost
involved, on a scale to which the “wastes of
competition” afford no parallel. It would
in fact achieve the essential folly of “sending
coals to Newcastle.” These considerations,
however, are not what interest the advocates of the
postal principle. They seem to recommend the
obliteration or the confusion of the relations between
price and cost as a superior ideal. It is important
to be clear what exactly this ideal involves.
It involves, in the first place, as the whole argument
of this volume has gone to show, a less economical
employment of our productive resources; they would
be diverted to ends of less utility, and so produce
less real wealth. But this is not the worst.
There is plenty of waste and maladjustment in our
economic system at the present time. The desirable
relation of price to marginal cost is but imperfectly
attained. The further departures from this relation,
which would follow from any likely applications of
the postal principle, might not matter in themselves
so very much. What is far more serious is that
the criteria of efficiency would become blunted, and
the clear aims of management would be confused in
fog. It is essential that every manager should
be on the alert to eliminate waste and to improve
efficiency, that he should be always trying to secure
the best results; but how can he do this if he has
no simple means of measuring what results are
good and what are bad? The measure which he has
at present is that of price, cost and the resultant
profit, and it would be fatal to take that away, unless
an equally simple and more accurate measure could
be substituted for it.