Mind Your Own Business

Purchase of this book includes free trial access to www.million-books.com where you can read more than a million books for free. This is an OCR edition with typos. Excerpt from book: HIDDEN PROFITS. WHEN driven into a corner by the overwhelming evidence of the commercial success of municipal trading, the champion of private enterprise shifts his ground, and often stands on his head. He retorts: Municipalities ought not to make Municipal profits. If municipal trams are only a service,...
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Purchase of this book includes free trial access to www.million-books.com where you can read more than a million books for free. This is an OCR edition with typos. Excerpt from book: HIDDEN PROFITS. WHEN driven into a corner by the overwhelming evidence of the commercial success of municipal trading, the champion of private enterprise shifts his ground, and often stands on his head. He retorts: Municipalities ought not to make Municipal profits. If municipal trams are only a service, they ought to make neither profit nor loss. Now, I have already explained that the making of cash profits or losses is only an incident in a municipal service. The cash profit or loss arises from the method of making charges for the service. It may be convenient to show a profit. It may be convenient to show a loss. If the tram fares cover the cost of the service and leave a balance over, there is a profit which reduces the general rates. If the water charges do not cover the cost of the services, there is a cash loss which is met by the general rates. That's all very fine, says the private trader; but how are we to know whether a business paysor not, except by the profit or loss shown on the year's working ? ch Profits not We may test private business in this way, but 1 we can only test municipal trading by considering all the facts, and all the facts concerning a municipal service are not contained in the cash profits or losses shown in the balance-sheet. Let us take an illustration. Six years ago the London County Council commenced to work 24 miles of tramways in South London. In North London they own a system 48 miles long leased to a private company. Sir A. Hendenon Sir Alexander Henderson, of the Great Central PryofienTrm Railway Company, said, In North London, the Nothing. company pay the London County Council a substantial rent for the lines they lease, and make a profit on the working. In the South, without re...