extravagance. The fairly substantial earnings have been insufficient even to cover actual expenses. It is hardly disputed that this result has been due to political interference. More recently the Government itself built and has till the other day operated the National Transcontinental Railroad, from Montreal to Winnipeg, another 1800 miles. Concerning this railroad, one fact suffices. It was estimated to cost $35,000 a mile; it did cost $90,000, without providing anything for rolling stock. The Royal Commission, as has been said already, recommended that, n spite of this experience, the State should take control of another 15,000 miles of railway then in the hands of rivate companies. The Government has acted on this ecommendation. It has already acquired the whole of he common stock of the Canadian Northern, with over 0,000 miles of line, thereby securing absolute control f the undertaking. It is at this moment negotiating Ferms on which the Grand Trunk and the Grand Trunk Pacific shall be taken over also.

The chief interest of this proceeding lies in the quesion how the Government proposes to manage this huge oncern-with control of 20,000 miles of railway. The #ommissioners, mindful of the baleful influence of olitics in the past, proposed that the management should e vested in a body of Trustees, to be originally appointed the Act of Parliament by name, but subsequently to e self-perpetuating; in other words, nominating their wn successors, the Government having power to reject at not to change the nominees. This recommendation, eliberately designed to make the management indeendent of Parliamentary interference unless and until e system was altered by a new Statute, has not been cepted in full. But the Government and Parliament ave gone a considerable distance in the direction prosed. By an Act just passed there has been constituted Dominion Railway Company, with a Board of Directors mposed of business men of high position, with powers management as full as those vested in the Board of ordinary commercial company. This Board is already anaging the Canadian Northern; the two lines hitherto ntrolled by the political Minister of Railways, the tercolonial and the Transcontinental; and the Grand unk Pacific. It is understood that it will assume the

management of the Grand Trunk also as soon as the negotiations for the transfer are completed.

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Of course it will be said that this is only a paper protection against politics. The members are appointed by, and must take their orders from, the Government under pain of dismissal. This is no doubt true, but it is, after all, inevitable. Parliament, as representing the public, is and must be supreme. If Members of Parlia ment determine not merely to settle broad policy, which they clearly should do, but to put their fingers into the actual management, which all experience proves they cannot do without disastrous results, and if they are permitted by their constituents to have their way, then it must so be. But Canada at least points to a way in which it is theoretically possible to get the advantages of State ownership without the disadvantages of State management. When the period of reconstruction is over, we may do well-substituting, to meet English con ditions, say, six or eight companies for one single company-to consider whether we cannot follow the Canadian precedent of administration by boards of business directors. With this difference, however. In Canada the Government is the sole shareholder, and naturally therefore appoints the entire Board, and will take all the profits when there are any. Under Canadian conditions this was inevitable. But here in England things are different. If half a dozen of the great com panies are kept alive during the transition period, it may prove desirable subsequently to bring them back to active life as operating companies, with Boards partly of official nominees, partly representative of the share holders. In other words, to adopt a scheme similar to that of the German municipalities, by which the private shareholders are rewarded for successful management by some agreed proportion of the net profits above their guaranteed net income.

W. M. AcWORTH.

rt. 11.-RECONSTRUCTION IN THE UNITED STATES. HEN the armistice of Nov. 11 brought the active war a conclusion, the United States had not reached the imax of its military and economic effort. Nineteen onths after the declaration of war America had creased its total armed forces on land and sea from 3,000 to 4,339,000. There had been transported overas, by the joint efforts of the British and American vies, an army of 2,053,347 men, of whom 1,338,169 had en in action by Nov. 11. The economic mobilisation, ich had proceeded but slowly during the first year of e war, was greatly accelerated in the early spring 1918, and had nearly reached its culmination in vember, although its results in the form of an abundant w of all necessary supplies and munitions would not ve been fully manifest until the spring of 1919.

The United States was hardly more ready for peace d the resumption of normal life in the fall of 1918 in it had been prepared for war in the spring of 1917. e American people as a whole had suffered but little; losses, although distressing, were insignificant in nparison with those of its associates in the war. The r-time restrictions, relating mainly to food and l, had not been of such severity or duration as to ise depression. The rewards of labour and agriculture re greater than ever before in the history of the intry; military service was still, to the majority of n in the army, a novel experience rather than an olerable burden; enthusiasm for the war had not ited, but on the contrary had been greatly increased the successes of the summer and fall; in short, the Entry was not tired but was only conscious of its idly increasing strength and was eager to exert it to utmost.

The end of the war brought the nation face to face h a variety of problems, some of which, such as the itary and economic demobilisation, the re-employat of labour, and the readjustment of industry, grew ctly out of the war, while others were old problems 1 in a new light or presented under greatly changed ditions because of the lessons and experiences of eteen months. To this latter group belonged such ol. 232.-No. 460.

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questions as the disposition of the railroads, the formulation of a shipping policy and the development of com merce and industry, and the whole series of problems centring about labour, including the relation of labour to capital and industry, the control of immigration, matters of public health and welfare, and the new direction of education.

No general or systematic preparation had been made for facing or solving the problems of readjustment. In the fall of 1918 two plans were proposed in Congress, neither of which came to a vote; one of these plans called for the appointment of a Congressional Committee on Reconstruction, the other provided for a Federal Commission on Reconstruction to be appointed by the President. The latter, which was understood to have the tacit support of the Administration, called for enquiries into such problems as the financing and development of the merchant marine, the development and direction of foreign trade, the readjustment of industries to normal production, the redistribution and employment of labour, the advancement of technical education and industrial research, the supply and distribution of food-stuffs and raw materials, the conservation and development of natural resources, the organisation of the railroads, telegraphs and telephones, and the reorganisation of the governmental departments and bureaus.

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Questions which in the early fall of 1918 seemed not to be pressing came, however, to the front when Congress assembled for the new session on Dec. 2. It had been expected that the President would present a more or less definite programme of reconstruction, but the programme was indefinite, even to the point of vagueness. With regard to readjustment in general he appeared to deprecate the idea of any systematic and comprehensive survey or treatment of the many problems involved:

'So far as our domestic affairs are concerned, the problem of our return to peace is a problem of economic and industrial readjustment. That problem is less serious for us than it may turn out to be for the nations which have suffered the disarrangements and the losses of war longer than we. Our people, moreover, do not wait to be coached and led. They know their own business, are quick and resourceful at every

adjustment, definite in purpose, and self-reliant in action. ny leading-strings we might seek to put them in would eedily become hopelessly tangled, because they would pay attention to them and go their own way. All that we can as their legislative and executive servants is to mediate e process of change, here, there, and everywhere as we may. have heard much counsel as to the plans that should be trsued and personally conducted to a happy consummation, it from no quarter have I seen any general scheme of "econstruction" emerge which I thought it likely we could rce our spirited business men and self-reliant labourers to cept with due pliancy and obedience.'

By way of justifying this view, the President proeded to point out that there were already many encies in existence, such as the Council of National fence, the War Industries Board, the War Trade Board, e Food and Fuel Administrations, the Departments Labour and Commerce, which had, during the war, en the centres of unified and co-operative action; and at, by reason of their special knowledge of conditions, ey were better able than any newly created organisan to mediate the process of change' in their reective fields. Furthermore, the President remarked at already, during the period of three weeks that had psed since the signing of the armistice, there had en rapid progress in the return to a peace footing, progress that promises to outrun any enquiry that y be instituted.'

Probably the President was correct in his estimate the situation. A comprehensive enquiry, like that ducted by the British Ministry of Reconstruction, if lertaken as a preliminary to demobilisation and reustment, would undoubtedly have served a most ful purpose, but by December the return to normal ditions was already well under way, and the existing ncies were endeavouring, not without a certain degree success, to cope with the situation. It is worth while review rapidly the process of this return during the t six months following the armistice.

The plan formulated by the War Department of the ited States for the demobilisation of its armed forces ered from that followed in Great Britain and in