0,000 to L35,000,000, and the
difference, L10,000,000, would come out of the pockets of Irish
shareholders. The Irish Government would be, however, in this unpleasant
dilemma, that if they issued the stock at a rate per cent, nominally
higher than the present return in railway capital, namely, 3.77 per
cent., the annual charge for interest would be greater than the net
receipts, and so from the beginning there would be an annual loss; and
the fact of this annual loss would be another factor tending to
depreciate the new Railway Stock. The alternatives before an Irish Prime
Minister, pressed to carry out a "Nationalisation" policy, are not
enviable. He will either have to provide by taxation for the annual loss
involved in taking over the railways on a fair basis, or to deprive the
most thrifty and industrious classes of his fellow-countrymen of a large
slice of their savings and investments. In either event, the new
Government will have received a serious blow to its credit at the outset
of its career.

EFFECT OF REDUCTION OF RAILWAY RATES.

There is, moreover, a special reason why such a stock, from its
inception, would tend to depreciate in value; namely, that from the
moment the Irish Government or their nominees became the owners, there
would be almost irresistible pressure put upon them to reduce the
railway rates, and generally (as indeed the Majority Report recommends)
to work the railways on other than commercial lines.[99] A reduction of
rates has been held out as the great resulting boon of nationalisation
ever since the Irish Parliamentary Party specifically raised the
question in Parliament in 1899. A 25 per cent. reduction in rates and
fares (suggested by Nationalist witnesses) would involve an annual
diminution of net receipts to the Government of over L1,000,000 per
annum, and if the reduction were in goods rates alone, the loss would be
L568,000 per annum. It would be years, if ever, before such a loss could
be recouped, however the traffic was increased. Experience has shown
that in recent years running expenses tend to increase nearly parallel
with the gross receipts, and a large increase in gross traffic would
involve enormous capital outlay for rolling stock, engines, sidings,
etc. It is unnecessary to comment upon the suggestion that the railways
should not be run on "commercial principles." The Irish ratepayers and
taxpayers, who would have to bear the loss, would loudly call out for
business m